Out with the old, in with the new

This year seems to be ending with quite a whimper - no mega song and dance, and no grand celebrations, no mega resolutions for the future. While such a sweeping generalization is probably incorrect by definition, it does seem that this is true for me, most of my buddies, the stock market, the political system, the country and the world in general! Considering that its not just the year which is ending, but also the decade, this seems doubly surprising.

The reasons for this are probably many - personal realizations, political instability, economic consolidation and mostly uncertainty about the future. In my opinion, such times are perfect for new beginnings. When one is not drowned in the hubris of a great yesterday nor drunk with the possibilities of tomorrow. Grand plans, sweeping changes, hairy goals - this is the season for renewal.

As a wise man once said: Arise, awake and stop not till the goal is reached!

So here's to all of us becoming better, wiser, happier, healthier in the New Year. Wish everyone a fantastic 2011! and a marvellous decade ahead!!

Getting better...

...with time! Our portfolio is getting to better its outperformance of the Nifty index with time (as it should!!)

Will post the next update 6 months later.

Mighty impressed with the Ombudsman

I have generally been happy with my banking relationship with ICICI Bank. They have a good internet banking system, and for years I have not had to go to the branch (and thank God! for that - the only time I went to the branch, it was chaotic, with hordes of people being served indifferently by rude bankers).

However, recently I came upon a mysterious debit in my bank account. The amount involved was not very large, around INR 6K, yet it merited some attention since it was totally unexplained. I therefore called up the call center, and found out that this was collection for a credit card. When I asked whose card it was, I was told that it was MY card!! I of course, know that I dont have any such card, so I probed deeper. I was told the card was issued in 2001!!! and that the last transaction had also been in that year!!

This was galling because of 2 things: 1) how can anyone debit my savings bank account without my authorization? forget the merits or demerits of this particular card, my bank account cannot be debited without my permission. 2) this credit card was issued 10 years ago - how was i to know if there was some 'insurance charge' or annual charge put on it at that time, and at the 36% rates that credit cards charge, had now become 6k. Theoretically, they could let it run for 100 years and present my grandkids with a bill for billions of rupees!!

I protested to the bank via various fora - the complaint mechanism, writing to the branch manager, calling up the call center etc etc. I got no satisfactory response. I then complained to the RBI Ombudsman online (it is a very simple process) and forgot all about the issue (of course I cut off all ties with ICICI Bank also).

Today, about 2 months later, I got a sudden call from ICICI Bank, saying that this was in regards to my complaint to the Ombudsman - they would reverse the debit, and clear all the outstanding on the card. So I am mighty pleased :-) and impressed!!

This is how IT and process streamlining is making life better for Indian citizens! Long live the IT revolution! Long live consumer protection!! Down with ICICI Bank - they probably do this to many people, and refund the few that bother to complain - I myself just happened to complain in a fit of pique - I would have not bothered a couple of hours later.

Look Ma, it works!

For those who like to track this sort of thing, time to look at the portfolio we had created way back in August. We have had a roaring bull market in October and a vicious bear in November. Today was particularly a carnage that happened ostensibly without reason. In short, the markets have been true to form - unpredictable in the short term.

No mean achievement, therefore, that the portfolio is now outperforming the index :-) With annualized returns of 23%, we are beating the Nifty by about 1.5%. We are not calling it a victory just yet though - we shall continue to measure and report!

Too Big to Fail

I think I'm done with reading books about the financial crises of 2008. Too Big To Fail, by New York Times reporter Andrew Ross Sorkin, is a mega journalistic narrative that captures, blow by blow, the conversations, thoughts and actions that happened in the US Government, Federal Reserve, markets and Wall Street investment banks in the three months that financial armageddon hit the world. I finished the book late last night, and came away reasonably impressed.

On the whole, it is an interesting and very commendable piece of work, but not in the same class as, for example, Barbarians at the Gate. The insights that the book offers are many - the Goldman Sachs nexus within the US Government, the filial loyalties that Wall Streeters have to their firms, and the heroic efforts of Henry Paulson, Tim Geithner and Ben Bernanke to do something, anything to stave off the crisis.

Turns out that most of the measures taken by these gents only exacerbated the sorry state of affairs in the markets. But one cannot really fault these gents, who were really solving very very messy crises each single day.

At the end, one cannot help but feel a bit sorry for Lehman Brothers, Dick Fuld and its team of executives, who did nothing that everyone else did not do, but were singled out for punishment. Many say that this was because personal animosity between Fuld and Goldman Sachs, and circumstantial evidence certainly points in that direction.

What I liked about the book was the little back stories of the key players - Dick 'Gorilla' Fuld, Jamie Dimon, the real hero of the crisis, Gary Fleming et. cetera. The key lesson for me was that tough times dont last, tough guys do!!