I wonder what has gotten into me recently that I keep coming up with these cryptic titles for my blogposts. Anyway, do not look it up, 'clerical meditation' is a term that will be defined for the first time in this blogpost.
Many people (me included) find it hard to sit and meditate. Our minds keep wandering. I am a compulsive thinker. I cannot therefore keep the thoughts in my mind still. Maybe I have not yet understood how to meditate. However, what I do know is the after-effects of meditation. The mind becomes clearer and the body feels energetic, yet relaxed.
Even though I do not meditate in the conventional way, my mind and body do experience the after effects I talked about. How does that happen? Answer: By doing mundane tasks which do not require much expertise. For example, making lists, rearranging my desk, organizing files in my PC, separating jigsaw pieces based on their colour before starting a jigsaw puzzle, removing dirt out of wheat grains, etc. I realized recently that doing such clerical tasks is also a type of meditation. I also understood the basic principle of concentration that is required in any form of meditation. Here, instead of concentrating withing yourself which I think is the conventional form, you concentrate on the task at hand but without exercising your brain a lot. The brain is still active but not stressed out in any way.
Therefore, clerical meditation can be defined as: "A modified form of meditation adapted to suit people who cannot focus within themselves but can focus outside themselves to perform tasks at hand that are mundane in nature and do not require mental energy or expertise".
Thursday, July 30, 2009
Sunday, July 26, 2009
Red-coloured nuisance
I live in a place called Ghatkopar where cowdung on the roads is a pretty regular sight. At times it is buffalodung also but I cannot tell the difference. In fact, I am so used to it that in the future, if I go and live in some foreign country and happen to see cowdung, I will start feeling homesick!
I guess, until someone builds toilets for cows, you cannot really blame the cows for public defecation! They've got to release it somewhere! Similar is the case with humans in Bombay. There aren't enough public restrooms and I would excuse someone who, in dire need of relieving himself, leaves a damp patch on the wall. I guess the appropriate cliche here is "When you gotta go, you gotta go!"
Two paragraphs over and I have not said anything about the red-coloured nuisance I mentioned in the title. So lets define it now - "A residue left in the mouth of a human when his/her saliva mixes with gutka which, if swallowed, causes hiccups and which, if spat out, causes public nuisance."
This is one nuisance that I definitely mind. It is because while cowdung and urination do cause a nuisance but at times, cannot be avoided - this definitely CAN be avoided. However, it has become so commonplace over centuries, that people are not ashamed of it. There are red streaks everywhere. Not only it is disgusting but it is also the cause of the spread of diseases. It has become the moral right of every gutka chewing citizen and if they are pulled up, they take a personal offence.
Two real life incidents:
1. I was minding my own business at a bus stop when some idiot spat next to my feet and my black shoes got two red dots on them. When I looked at him angrily, he smiled shamelessly.
2. This time railway station, a person again spits next to me, this time no red dots on my shoe but still I express my displeasure. His self-righteously angry argument - "Side pe gira naa, aap pe to nahi."
Even though smokers pollute the air, the smoke fizzles away, but gutka chewers make the ground dirty and leave their mark for a long time. I wonder then why there are so many people against smoking but very few against this public nuisance. If there is a whole-hearted drive by the BMC to fine all such people caught, it may not make much difference to the troublemakers but it will still be a small stepping stone to eradicate the filthy habit. To the best of my knowledge, the fine is currently Rs. 500. Even if it is reduced to Rs. 100 but the effort is whole-hearted, the BMC will earn a lot of money!
I also feel strongly about non-gutka chewing people spitting for no reason whatsoever or sportsmen spitting on the very grass they dive and play on but I will reserve that for another post. Also, politically speaking, there is another red-coloured nuisance which goes by the name of Prakash Karat, I might write about that too once I come out of my habit of writing about right-wing nuisance!
I guess, until someone builds toilets for cows, you cannot really blame the cows for public defecation! They've got to release it somewhere! Similar is the case with humans in Bombay. There aren't enough public restrooms and I would excuse someone who, in dire need of relieving himself, leaves a damp patch on the wall. I guess the appropriate cliche here is "When you gotta go, you gotta go!"
Two paragraphs over and I have not said anything about the red-coloured nuisance I mentioned in the title. So lets define it now - "A residue left in the mouth of a human when his/her saliva mixes with gutka which, if swallowed, causes hiccups and which, if spat out, causes public nuisance."
This is one nuisance that I definitely mind. It is because while cowdung and urination do cause a nuisance but at times, cannot be avoided - this definitely CAN be avoided. However, it has become so commonplace over centuries, that people are not ashamed of it. There are red streaks everywhere. Not only it is disgusting but it is also the cause of the spread of diseases. It has become the moral right of every gutka chewing citizen and if they are pulled up, they take a personal offence.
Two real life incidents:
1. I was minding my own business at a bus stop when some idiot spat next to my feet and my black shoes got two red dots on them. When I looked at him angrily, he smiled shamelessly.
2. This time railway station, a person again spits next to me, this time no red dots on my shoe but still I express my displeasure. His self-righteously angry argument - "Side pe gira naa, aap pe to nahi."
Even though smokers pollute the air, the smoke fizzles away, but gutka chewers make the ground dirty and leave their mark for a long time. I wonder then why there are so many people against smoking but very few against this public nuisance. If there is a whole-hearted drive by the BMC to fine all such people caught, it may not make much difference to the troublemakers but it will still be a small stepping stone to eradicate the filthy habit. To the best of my knowledge, the fine is currently Rs. 500. Even if it is reduced to Rs. 100 but the effort is whole-hearted, the BMC will earn a lot of money!
I also feel strongly about non-gutka chewing people spitting for no reason whatsoever or sportsmen spitting on the very grass they dive and play on but I will reserve that for another post. Also, politically speaking, there is another red-coloured nuisance which goes by the name of Prakash Karat, I might write about that too once I come out of my habit of writing about right-wing nuisance!
Monday, July 20, 2009
F1-race, idlis and Angelina Jolie
I can imagine the contorted look on your face after reading the title. Those with an unnecessarily over-active brain like mine must also be trying to find a link between the three entities in the title. I am writing this blog to exemplify the concepts of tolerance and independent thinking. Now the over-active brainy nerds must be all at sea now that I have added two concepts to the three entities.
So before your brains explode, let me explain - In spite of most Indians being crazy fans of the three entities, I am not one of them. I have my own independent thinking and hence not joined the bandwagon. However, the concept of tolerance for my views and choices goes for a toss when people cannot believe what they hear when I tell them about it. I will demonstrate their intolerance in the paragraphs below.
Firstly F-1. My friend once got mortally offended by the fact that I do not know who Juan Pablo Montoya is. He told me I lived in some parallel universe if I don't know him. I'm glad we were chatting on the net and not face to face when I told him I neither like nor follow F-1, otherwise there would have been some violent wrangling from his side. Come to think of it, I'm not a keen follower of regular cars on the road too. I don't drool when I pass by an Audi showroom. Let's face it, I am not turned on by cars and would appreciate if people got off my back about it. I don't pester them by saying "How can you like F-1? Don't you find it funny when those commentators talk really fast? If you are getting a hard-on by looking at a hummer, you have issues!" - I'd like to say all that but I don't because I believe in independent thinking!
Now let me come to idli. Many people have expressed amazement at the fact that I do not like idli. Their standard response - "But it is so soft! What is there not to like? Everyone likes it but you!". Even cowdung is soft for that matter. It is sour, chewy and does not have any effect on my taste buds (idli not cowdung). Unfortunately, the idli has been elevated to such a status that people do not buy the argument and consider me a spoilt idiot who rejects such a cheap, simple and healthy snack. The fact that I like dosa does not pacify them. Come to think of it, the gujarati adaptation of idli - the dhokla is something I dislike even more. I hope I do not get ostracized from the Gujarati community.
Finally, Angelina Jolie. I normally do not criticize other people's choices because, like I said, I believe in independent thinking. However, let me say this, she does not seem human. How can guys be turned on by that creature is beyond my understanding.
There are other entities also which I do not like and do not force myself to like them because of social pressure. One of them is hip-hop, I intend to dedicate one whole blog to this utterly lousy excuse for music. The others are Aishwarya Rai, Johnny Lever, Barclays Premiere League, Popcorn, etc.
Live and Let Live !!!!!
So before your brains explode, let me explain - In spite of most Indians being crazy fans of the three entities, I am not one of them. I have my own independent thinking and hence not joined the bandwagon. However, the concept of tolerance for my views and choices goes for a toss when people cannot believe what they hear when I tell them about it. I will demonstrate their intolerance in the paragraphs below.
Firstly F-1. My friend once got mortally offended by the fact that I do not know who Juan Pablo Montoya is. He told me I lived in some parallel universe if I don't know him. I'm glad we were chatting on the net and not face to face when I told him I neither like nor follow F-1, otherwise there would have been some violent wrangling from his side. Come to think of it, I'm not a keen follower of regular cars on the road too. I don't drool when I pass by an Audi showroom. Let's face it, I am not turned on by cars and would appreciate if people got off my back about it. I don't pester them by saying "How can you like F-1? Don't you find it funny when those commentators talk really fast? If you are getting a hard-on by looking at a hummer, you have issues!" - I'd like to say all that but I don't because I believe in independent thinking!
Now let me come to idli. Many people have expressed amazement at the fact that I do not like idli. Their standard response - "But it is so soft! What is there not to like? Everyone likes it but you!". Even cowdung is soft for that matter. It is sour, chewy and does not have any effect on my taste buds (idli not cowdung). Unfortunately, the idli has been elevated to such a status that people do not buy the argument and consider me a spoilt idiot who rejects such a cheap, simple and healthy snack. The fact that I like dosa does not pacify them. Come to think of it, the gujarati adaptation of idli - the dhokla is something I dislike even more. I hope I do not get ostracized from the Gujarati community.
Finally, Angelina Jolie. I normally do not criticize other people's choices because, like I said, I believe in independent thinking. However, let me say this, she does not seem human. How can guys be turned on by that creature is beyond my understanding.
There are other entities also which I do not like and do not force myself to like them because of social pressure. One of them is hip-hop, I intend to dedicate one whole blog to this utterly lousy excuse for music. The others are Aishwarya Rai, Johnny Lever, Barclays Premiere League, Popcorn, etc.
Live and Let Live !!!!!
Friday, July 17, 2009
Cliche'mongers
Why do some people not realize that using cliches is not going to make them look any smarter? How the hell do they get themselves to say it with the full knowledge that it has been said in the same freaking context a quadrillion times before? And worst of all, why do they have to appear very wise when they blurt out the banality? The last question I asked is the most significant because the self-imposed wisdom on such people makes me squirm like a jellyfish. Unfortunately, I can only squirm like a jellyfish and not suck blood like them. These buggers deserve nothing less than these near-fatal stings!
I am going to test a few of them on you, if your nerves get frazzled and your temper becomes unstable, stop reading further and go to the next paragraph as these cliches are not worth the strands of hair you will be pulling out!
Can't write anymore as the vein in my head is already throbbing. But do notice that the ones I've listed above are not overused english proverbs or idioms. They are dumb sentences blurted out by over-enthusiastic, extroverted donkeys posing as human beings.
Whenever I read them, I am reminded of macho guys who suffer grand delusions about themselves. Not only do they lack originality but also believe that it'll sound better when they say it.
I am going to test a few of them on you, if your nerves get frazzled and your temper becomes unstable, stop reading further and go to the next paragraph as these cliches are not worth the strands of hair you will be pulling out!
- Nothing is impossible, even Impossible says I M Possible.
- I live life to the fullest.
- If you assume, you are making an ass of you and me because assume = ass + u + me.
- I work hard and party harder.
- I am a die-hard go-getter.
- All a guy needs is a cold beer and a hot chick.
- Hum khushi mein bhi peete hai, gham mein bhi peete hai.
- Quitters never win and winners never quit.
- A light at the end of the tunnel may be that of an oncoming train.
- Nice guys finish last.
Can't write anymore as the vein in my head is already throbbing. But do notice that the ones I've listed above are not overused english proverbs or idioms. They are dumb sentences blurted out by over-enthusiastic, extroverted donkeys posing as human beings.
Whenever I read them, I am reminded of macho guys who suffer grand delusions about themselves. Not only do they lack originality but also believe that it'll sound better when they say it.
Wednesday, July 15, 2009
Savita Bhabhi
I've always wondered what Indian erotica would be like and the concept of a horny bhabhi is simply brilliant.
It is brilliant because the Indian society is known for its sexually repressed women. I sometimes think people fail to realize that women don't have sex as a favour to please the man. They have it because they also want it. Men are to blame for their chauvinistic attitude of keeping a hold on women's freedom of expression to 'control' them. Women are also to be blamed for trying to appear modest and innocent while their loins are burning with lust. Savita Bhabhi therefore, breaks these shackles and appears as a liberated woman.
Conservative prudes ought to realize that banning a website will not end the liberal thinking of 50 million odd visitors to her website. I won't be surprised if someone tells me 10 million of those visitors were women. Erotica is not to be taken seriously because it is a concept which does not even take itself seriously. The mind needs a release from the inevitable sexual thoughts and if such websites provide that, it is all the better. No matter how chaste you are, if you have gonads, then your mind and body will force you to look out for a release irrespective of the culture you so fanatically live by.
Savita Bhabhi, RIP. You were a bold woman, I respect you for that.
It is brilliant because the Indian society is known for its sexually repressed women. I sometimes think people fail to realize that women don't have sex as a favour to please the man. They have it because they also want it. Men are to blame for their chauvinistic attitude of keeping a hold on women's freedom of expression to 'control' them. Women are also to be blamed for trying to appear modest and innocent while their loins are burning with lust. Savita Bhabhi therefore, breaks these shackles and appears as a liberated woman.
Conservative prudes ought to realize that banning a website will not end the liberal thinking of 50 million odd visitors to her website. I won't be surprised if someone tells me 10 million of those visitors were women. Erotica is not to be taken seriously because it is a concept which does not even take itself seriously. The mind needs a release from the inevitable sexual thoughts and if such websites provide that, it is all the better. No matter how chaste you are, if you have gonads, then your mind and body will force you to look out for a release irrespective of the culture you so fanatically live by.
Savita Bhabhi, RIP. You were a bold woman, I respect you for that.
Tuesday, July 14, 2009
De-romanticizing the rain
I am getting pretty annoyed with people who keep putting forth their undying love for the rain. It makes me feel that they are pretentiously projecting themselves as die-hard romantics.
Let me put a disclaimer first - I respect need for rain, it is a direct source of water and an indirect source of food. Somehow, I need to consume both food and water everyday. Hence, I fully recognize the need for rain.
Having said that, I still do not like when it rains simply because it makes me lazy, disrupts travel plans, makes the ground mucky, makes me want to pee frequently and worst of all, the concept of hygienic surroundings goes for a toss.
I have not even mentioned electricity and water supply issues! A bad monsoon in Bombay still means a lot of rains and floods and yet less water supply. Frequent electrical outages are not that uncommon.
One more problem that I have which I'm sure you'll point at me or this blog and laugh is that my craving for tea increases during the rain. I just feel like having tea in damp surroundings somehow. I am trying to reduce my tea intake now and the rains are not helping.
Those who live in Bombay and who keep prattling about "loving to walk in the rain" and all such romantic cowcrap also have to go through similar problems as me which makes me annoyed at their pretenses even more!
Let me put a disclaimer first - I respect need for rain, it is a direct source of water and an indirect source of food. Somehow, I need to consume both food and water everyday. Hence, I fully recognize the need for rain.
Having said that, I still do not like when it rains simply because it makes me lazy, disrupts travel plans, makes the ground mucky, makes me want to pee frequently and worst of all, the concept of hygienic surroundings goes for a toss.
I have not even mentioned electricity and water supply issues! A bad monsoon in Bombay still means a lot of rains and floods and yet less water supply. Frequent electrical outages are not that uncommon.
One more problem that I have which I'm sure you'll point at me or this blog and laugh is that my craving for tea increases during the rain. I just feel like having tea in damp surroundings somehow. I am trying to reduce my tea intake now and the rains are not helping.
Those who live in Bombay and who keep prattling about "loving to walk in the rain" and all such romantic cowcrap also have to go through similar problems as me which makes me annoyed at their pretenses even more!
Sunday, July 12, 2009
Authoritative SEBI and the Lowdown Sub-broker
Question: What happens when the teacher punishes the whole class because a few students played mischief?
Answer: Even the honest students suffer.
Question: What does that say about the teacher?
Answer: Following comments can be attributed to the teacher in question :-
1. She is lazy in finding out the culprit.
2. She does not care if the honest students suffer.
3. A blanket punishment will at least ensure her peace of mind and that is all she desires.
Something like this has happened recently when the regulatory authority of mutual funds SEBI has abolished the entry load on equity mutual funds.
To know more about it, the blogger in me (bold font) has interviewed the RM in me. The entire text of the interview is presented below.
What is an entry load?
If an ordinary investor chooses to invest in an equity mutual fund with the help of a distributor, a certain fee amounting to 2.25% is charged to the investor by the company that manages the fund (AMC). This 2.25% is then fully or partially transferred to the distributor as commission.
Why should the investor be willing to forego the 2.25%?
He gets professional advise on his hard-earned money. Investing in equity can be risky in volatile markets. Nothing wrong in spending more to get safety and probably better returns.
Why should the AMC be willing to pay the distributor 2.25%?
For convincing the investor to invest in its mutual fund.
What was the one striking feature of the 2.25% load?
It was uniform throughout AMCs. No AMC can charge a higher load to pass back a higher commission to the distributor which could unnecessarily incentivise the distributor to sell more of the AMC's funds.
What is a KYC?
KYC (Know Your Customer) is a method by which the distributor performs a thorough check on its customer's risk taking appetite and makes a note of his financial goals. These KYC's are then audited to ensire misselling has not happened to the customer.
Which distributors followed this system rigorously? Did they also conduct auditable KYCs on their customers?
Largely banks and reputed Brokerage houses.
Who found loopholes in the system? What wrong did they commit?
Largely small-time sub-brokers. Sleazeballs who live off churning the client's stock as well as mutual fund portfolio to earn more brokerage. They passed a large part of the commission they get from the AMC back to the investor. Of course, they do it in cash. For example, if an investor invests Rs. 10,00,000 in a mutual fund, he will be charged an entry load of 2.25%. Let us assume that the AMC retains .25% of it and passes the 2% back to the distributor. Thus the distributor earns Rs. 20,000. Let us take a conservative estimate and assume that the sleazeball pays Rs. 10,000 out of that to the customer in cash.
Do such "sleazeballs" as you call them do a KYC?
Not to the best of my knowledge. Even if they do, it is quite cursory.
What is churning the portfolio?
It is basically frequently buying and selling securities (stocks and funds) on the client's behalf thereby earning frequent brokerage.
Why is it so wrong that you have to write a lengthy acerbic blog about it?
For the following reasons:
1. Miserly investors for whom even that 1% passback matters will be drawn towards the sleazeballs. I've interacted with many of them and it is hard to convince them to come out of the penny-pinching habit and take a more professional advice. This is to their own detriment as such sleazeballs often make them churn their portfolio and earn brokerage while keeping them happy with passbacks.
2. Law-abiding, compliance-dependent distributors lose out on such business as they are unable to give passback.
Conclusion: Both the investor as well as the compliant distributor suffers.
Who is SEBI?
Securities Exchange Board of India. It is a regulator for mutual funds and other securities. It claims to always be in the interest of the investor.
What has SEBI done now?
It has abolished the entry load system. The distributors will no longer get commission. They are now supposed to charge an investment advisory fee from their customers.
Why have they done that?
To stop the sleazeballs from passing back commission to their customers. No commission = no passback.
What about the honest distributors?
That is primarily why I am so agitated. They did no wrong. Why should they not get a commission?
What about the investors?
Let me tell you frankly, mutual fund is a product that is not 'bought by people', it is 'sold to people'. If the distributors will lose interest in selling them, very few people will proactively buy them. Retail participation will drastically reduce. That is neither good for the mutual fund industry nor for the distributors and nor for SEBI. Apart from regulatory responsibilities, SEBI also has to work on making the mutual fund industry a vibrant one by encouraging retail participation.
What else could SEBI have done?
How about taking the pains to run an investigation by auditing accounts of a select few sub-brokers, gathering intelligence and creating an example by conducting legal proceedings against at least one sleazeball if he gets caught taking passbacks?
What are the far-reaching implications?
The Insurance Industry will get a major boost. Their fees as well as commissions are not uniform and not strictly regulated. Distributors can get upto 40% commission or more by selling a Unit Linked Insurance Plan (ULIP). Insurance policies generate a substantially higher revenue for a distributor than any mutual fund investment. In fact, even before the 2.25% load on mutual funds was abolished, distributors preferred to sell ULIPs as 40% is much higher than 2%. A lot of misselling happened because insurance policies are hardly transparent. Now even with the 2.25% gone, the hardeselling and misselling of Insurance policies will increase further.
So the retail investor will still suffer?
Absolutely. That is why I consider SEBI's move stupid. They made this regulation for the benefit of the investor and my educated guess is that he will suffer more. In any case, there is a separate regulator for insurance - IRDA where SEBI has no say.
Thanks for your time.
Thanks for having me here.
Answer: Even the honest students suffer.
Question: What does that say about the teacher?
Answer: Following comments can be attributed to the teacher in question :-
1. She is lazy in finding out the culprit.
2. She does not care if the honest students suffer.
3. A blanket punishment will at least ensure her peace of mind and that is all she desires.
Something like this has happened recently when the regulatory authority of mutual funds SEBI has abolished the entry load on equity mutual funds.
To know more about it, the blogger in me (bold font) has interviewed the RM in me. The entire text of the interview is presented below.
What is an entry load?
If an ordinary investor chooses to invest in an equity mutual fund with the help of a distributor, a certain fee amounting to 2.25% is charged to the investor by the company that manages the fund (AMC). This 2.25% is then fully or partially transferred to the distributor as commission.
Why should the investor be willing to forego the 2.25%?
He gets professional advise on his hard-earned money. Investing in equity can be risky in volatile markets. Nothing wrong in spending more to get safety and probably better returns.
Why should the AMC be willing to pay the distributor 2.25%?
For convincing the investor to invest in its mutual fund.
What was the one striking feature of the 2.25% load?
It was uniform throughout AMCs. No AMC can charge a higher load to pass back a higher commission to the distributor which could unnecessarily incentivise the distributor to sell more of the AMC's funds.
What is a KYC?
KYC (Know Your Customer) is a method by which the distributor performs a thorough check on its customer's risk taking appetite and makes a note of his financial goals. These KYC's are then audited to ensire misselling has not happened to the customer.
Which distributors followed this system rigorously? Did they also conduct auditable KYCs on their customers?
Largely banks and reputed Brokerage houses.
Who found loopholes in the system? What wrong did they commit?
Largely small-time sub-brokers. Sleazeballs who live off churning the client's stock as well as mutual fund portfolio to earn more brokerage. They passed a large part of the commission they get from the AMC back to the investor. Of course, they do it in cash. For example, if an investor invests Rs. 10,00,000 in a mutual fund, he will be charged an entry load of 2.25%. Let us assume that the AMC retains .25% of it and passes the 2% back to the distributor. Thus the distributor earns Rs. 20,000. Let us take a conservative estimate and assume that the sleazeball pays Rs. 10,000 out of that to the customer in cash.
Do such "sleazeballs" as you call them do a KYC?
Not to the best of my knowledge. Even if they do, it is quite cursory.
What is churning the portfolio?
It is basically frequently buying and selling securities (stocks and funds) on the client's behalf thereby earning frequent brokerage.
Why is it so wrong that you have to write a lengthy acerbic blog about it?
For the following reasons:
1. Miserly investors for whom even that 1% passback matters will be drawn towards the sleazeballs. I've interacted with many of them and it is hard to convince them to come out of the penny-pinching habit and take a more professional advice. This is to their own detriment as such sleazeballs often make them churn their portfolio and earn brokerage while keeping them happy with passbacks.
2. Law-abiding, compliance-dependent distributors lose out on such business as they are unable to give passback.
Conclusion: Both the investor as well as the compliant distributor suffers.
Who is SEBI?
Securities Exchange Board of India. It is a regulator for mutual funds and other securities. It claims to always be in the interest of the investor.
What has SEBI done now?
It has abolished the entry load system. The distributors will no longer get commission. They are now supposed to charge an investment advisory fee from their customers.
Why have they done that?
To stop the sleazeballs from passing back commission to their customers. No commission = no passback.
What about the honest distributors?
That is primarily why I am so agitated. They did no wrong. Why should they not get a commission?
What about the investors?
Let me tell you frankly, mutual fund is a product that is not 'bought by people', it is 'sold to people'. If the distributors will lose interest in selling them, very few people will proactively buy them. Retail participation will drastically reduce. That is neither good for the mutual fund industry nor for the distributors and nor for SEBI. Apart from regulatory responsibilities, SEBI also has to work on making the mutual fund industry a vibrant one by encouraging retail participation.
What else could SEBI have done?
How about taking the pains to run an investigation by auditing accounts of a select few sub-brokers, gathering intelligence and creating an example by conducting legal proceedings against at least one sleazeball if he gets caught taking passbacks?
What are the far-reaching implications?
The Insurance Industry will get a major boost. Their fees as well as commissions are not uniform and not strictly regulated. Distributors can get upto 40% commission or more by selling a Unit Linked Insurance Plan (ULIP). Insurance policies generate a substantially higher revenue for a distributor than any mutual fund investment. In fact, even before the 2.25% load on mutual funds was abolished, distributors preferred to sell ULIPs as 40% is much higher than 2%. A lot of misselling happened because insurance policies are hardly transparent. Now even with the 2.25% gone, the hardeselling and misselling of Insurance policies will increase further.
So the retail investor will still suffer?
Absolutely. That is why I consider SEBI's move stupid. They made this regulation for the benefit of the investor and my educated guess is that he will suffer more. In any case, there is a separate regulator for insurance - IRDA where SEBI has no say.
Thanks for your time.
Thanks for having me here.
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