Financial Non Traditional Thoughts

[krish44]

Share:

Facebook X (Twitter) WhatsApp Email Share Link

There are some hidden gems in the post' cranks corner'

The hassles involved in taking ones own money out of PF and forgetting to pay premiums for insurance policies or misplacing insurance documents which you thought you

had could be taxing.

I had taken an insurance policy some 35 years back -just a one time payment to oblige an old man hawking it and then forgot about it ,After 25 years insurance fellows

contacted me to tell that i can get a monthly payment of a small amount. Only I did not know where the policy document was.there are also fraud fellows who ring up

to say my policy is awarded a bonus .LIC keeps telling not to believe these callers.There is a harassment value to all this. even I get calls from banks [recorded] that

my FD has matured when I know I do not have any such deposit. Many banks have poor record keeping and do not keep track of matured and closed deposits.

when I approached the bank they could not trace any such FD.

I am losing faith in the recording system of any type of deposit or insurance.

Now with cracking of whip by sebi and other agencies , the dividend cheques I have not received are suddenly making a reappearance in my mail box.

I did not even know I had these shares, They are in paper form and not in demat.Even the margin money deposited with brokers are returned every quarter in keeping with

sebi guidelines.

for a small time person like me there are these problems ,I wonder what all well off people must be facing.

 

[Janaki Jambunathan]

This is through Android. So I make it very brief.
Why all the trouble?
Buy a house with the savings. When inflation overtakes you take a reverse mortgage loan and live happily for ever. LOL.

I approached a bank regarding this - You have the right to live in your house till death - But cannot rent it out if your not able to live there for some reason - Hence as an investment is it advisable?

 

[prasad1]

Reverse Mortgage Pros and Cons


The reverse mortgage pros and cons should be measured carefully before subscribing to it. Since, the bulk of the savings for the average Indian are typically locked away in a house or other property at the time of retirement, and in case of requirement it cannot be encashed except by selling the home or moving out. This is where reverse mortgage comes as an answer.

Taking the usual mortgage loans in lieu of your home as a security will not be feasible in the age above 50 as the repayment of the loan is not feasible. The Banks And Financial Institutions also won't be of any help in case of no income source. This is where the house property proves as an asset and brings in reverse mortgage that allows you to be the home owner as long as you live. Home ownership is an area most Indians are sensitive about and reverse mortgage entitles you your house throughout your remaining life.

According to demographic projections, reverse mortgage loan products could be a hit among the metros and also in areas like Kerala, Tamil Nadu, Goa and Chandigarh in India. With hardly any old age social security schemes and financial helplines, reverse mortgages have a potential market. Loans are available in the form of reverse mortgage without any income criteria at an age where normal loans are not available. Reverse mortgage for senior citizens is a social assurance post-retirement.
- See more at: http://www.indiahousing.com/loans/reverse-mortgage.html#sthash.9xmsTIhQ.dpuf

• This is not applicable to commercial properties. Reverse Mortgage Loans apply only to residential properties that are self occupied by the borrower i.e. you, and the house that you live in. This is known as your 'permanent primary residence'.

https://www.personalfn.com/knowledge-center/FullStory/12-05-15/Reverse_Mortgage_-_All_You_Need_To_Know.aspx

 

[Janaki Jambunathan]

Dr. Jagdish Bhagwati, the famous Indian-born economist in the US, told
Manmohan Singh that Indians wastefully save.

'Saving is sin, and spending is virtue.'


Read on:

From my inbox

Look how world economy revolves...

*Interesting!! *

Wise men talk because they have something to say; fools because they have
to say something.
Amazing logic indeed, this is a crazy world!

*Interesting article written by an Indian Economist. *

Japanese save a lot. They do not spend much.
Also, Japan exports far more than it imports.
Has an annual trade surplus of over 100 billion. Yet Japanese economy
is considered
weak, even collapsing.

Americans spend, save little. .......
Also, US import more than it exports.
Has an annual trade deficit of over $ 400 billion. Yet, the American economy
is considered strong and trusted to get stronger.
But where from do Americans get money to spend?

They borrow from Japan, China and even India.

Virtually others save for the US to spend.
Global savings are mostly invested in US, in dollars.

India itself keeps its foreign currency assets of over $ 50 billion in US
securities.

China has sunk trillions of dollars in US securities.

Japan's stakes in US securities is in many billions.

*The Result: *
The US has taken over $ 5 trillion from the world.
So, as the world saves for the US, Americans spend freely.

Today, to keep the US consumption going, that is for the US economy to work,
other countries have to remit $ 180 billion
every quarter, which is $ 2 billion a day, to the US !

A Chinese economist asked a neat question.
Who has invested more, US in China, or China in US?
The US has invested in China less than half of what China has invested in
US.
The same is the case with India. We have invested in US over $ 50 billion,
but the US has invested less than $ 20 billion in India.

*Why the world is after US? *

The secret lies in the American spending, that they hardly save. In fact,
they use their credit cards to spend their future income. That the US
spends is what makes it attractive to export to the US.

So, US import more than what it export year after year.

*The result: *
The world is dependent on US consumption for its growth. By its deepening
culture of consumption, the US has habituated the world to feed on US
consumption. But as the US needs money to finance its consumption, the
world provides the money.

It's like a shop-keeper providing the money (credit) to a customer so that
the customer keeps buying from the shop.

If the customer will not buy, the shop won't have business,
unless the shopkeeper funds him. The US is like the lucky customer. And the
world is like the helpless shopkeeper financier.

Who is America's biggest shopkeeper financier?

Japan of course.
Yet it's Japan which is regarded as weak. Modern economists complain
that Japanese
do not spend, so they do not grow.
To force the Japanese to spend, the Japanese government exerted itself, reduced
the savings rates, even charged the savers.

Even then the Japanese did not spend (habits don't change, even with taxes, do
they?).
Their traditional postal savings alone is over $ 1.2 trillion,
about three times the Indian GDP. Thus, savings, far from being the strength
of Japan, has become its pain.

Hence, what is the lesson?
*That is, a nation cannot grow unless the people spend, not save. Not just
spend, but borrow and spend. *

This the new theory of economics has evolved

Dr. Jagdish Bhagwati, the famous Indian-born economist in the US, told
Manmohan Singh that Indians wastefully save.

Ask them to spend, on imported cars and, seriously, even on cosmetics!
This will put India on a growth curve.
This is one of the reasons for MNC's coming down to India, seeing the
consumer spending.

'Saving is sin, and spending is virtue.'

But before you follow this neo economics, get some fools to save so that
you can borrow from them and spend !!!

 

[krish44]

I have always believed that govt should not encourage savings by giving income tax relief for savings under section 88 or for bank savings.

In a inflation ridden economy it is foolish to save.

The public should spend or invest in asset classes which appreciate to beat inflation and give returns.

We should develop the habit of spending and enjoying it.

Happiness of today is definitely very important -specially for senior citizen.

Have a splash and enjoy it.

Then invest carefree in high return investment and multiply money.

Happy person multiplies money better than a thrifty miser.lol

Special thanks to jj ji for her post.JJ ji ki jai

 

[Vaagmi]

Dr. Jagdish Bhagwati, the famous Indian-born economist in the US, told
Manmohan Singh that Indians wastefully save.
'Saving is sin, and spending is virtue.'
Read on:
From my inbox
Look how world economy revolves...
*Interesting!! *
Wise men talk because they have something to say; fools because they have
to say something.
Amazing logic indeed, this is a crazy world!
*Interesting article written by an Indian Economist. *
Japanese save a lot. They do not spend much.
Also, Japan exports far more than it imports.
Has an annual trade surplus of over 100 billion. Yet Japanese economy
is considered
weak, even collapsing.
Americans spend, save little. .......
Also, US import more than it exports.
Has an annual trade deficit of over $ 400 billion. Yet, the American economy
is considered strong and trusted to get stronger.
But where from do Americans get money to spend?
They borrow from Japan, China and even India.
Virtually others save for the US to spend.
Global savings are mostly invested in US, in dollars.
India itself keeps its foreign currency assets of over $ 50 billion in US
securities.
China has sunk trillions of dollars in US securities.
Japan's stakes in US securities is in many billions.
*The Result: *
The US has taken over $ 5 trillion from the world.
So, as the world saves for the US, Americans spend freely.
Today, to keep the US consumption going, that is for the US economy to work,
other countries have to remit $ 180 billion
every quarter, which is $ 2 billion a day, to the US !
A Chinese economist asked a neat question.
Who has invested more, US in China, or China in US?
The US has invested in China less than half of what China has invested inUS.
The same is the case with India. We have invested in US over $ 50 billion,
but the US has invested less than $ 20 billion in India.
*Why the world is after US? *
The secret lies in the American spending, that they hardly save. In fact,
they use their credit cards to spend their future income. That the US
spends is what makes it attractive to export to the US.
So, US import more than what it export year after year.
*The result: *
The world is dependent on US consumption for its growth. By its deepening
culture of consumption, the US has habituated the world to feed on US
consumption. But as the US needs money to finance its consumption, the
world provides the money.
It's like a shop-keeper providing the money (credit) to a customer so that
the customer keeps buying from the shop.
If the customer will not buy, the shop won't have business,
unless the shopkeeper funds him. The US is like the lucky customer. And the
world is like the helpless shopkeeper financier.
Who is America's biggest shopkeeper financier?
Japan of course.
Yet it's Japan which is regarded as weak. Modern economists complain
that Japanese
do not spend, so they do not grow.
To force the Japanese to spend, the Japanese government exerted itself, reduced
the savings rates, even charged the savers.
Even then the Japanese did not spend (habits don't change, even with taxes, do
they?).
Their traditional postal savings alone is over $ 1.2 trillion,
about three times the Indian GDP. Thus, savings, far from being the strength
of Japan, has become its pain.
Hence, what is the lesson?
*That is, a nation cannot grow unless the people spend, not save. Not just
spend, but borrow and spend. *
This the new theory of economics has evolved
Dr. Jagdish Bhagwati, the famous Indian-born economist in the US, told
Manmohan Singh that Indians wastefully save.
Ask them to spend, on imported cars and, seriously, even on cosmetics!
This will put India on a growth curve.
This is one of the reasons for MNC's coming down to India, seeing the
consumer spending.
'Saving is sin, and spending is virtue.'
But before you follow this neo economics, get some fools to save so that
you can borrow from them and spend !!!

What is relevant is sacrificed here for the sake of bringing in sarcasm.

1. The investment of Japan, China and India in US is largely in Treasury Notes of the US Govt. It is a security which is backed by the sovereign guarantee of the US and yields interest income too. Repayment is 100% assured unless US as a nation collapses. It is not investment in the volatile securities of the trade and commerce in US. So coming back to the shop-keeper example, the shop keeper in this case is not advancing money to the customer just freely for consumption which may not come back ultimatley. He lends money against the family silvers and gold of the consumer which are backed by 100% sale value at any given time.

Saving is not sin. Not investing the savings or spending it in political schemes is certainly the sin. It will come back to haunt us.

 

[krish44]

I approached a bank regarding this - You have the right to live in your house till death - But cannot rent it out if your not able to live there for some reason - Hence as an investment is it advisable?

House can easily give you good returns without reverse mortgage.

First is it a house or a flat?

If it is a house, invest a little to add a floor and rent it off . alternatively extend the ground floor to make it two portions for stay and renting one out.

It is always wise to have real estate to both live in and live off.

Thats one of the best models for senior citizens,

One more family staying in close proximity is security for the senior citizen.

 

[Janaki Jambunathan]

https://www.google.co.in/url?sa=t&r...8wOL_MmAg5aw1ZmLw&sig2=Mav01ZN5JnDWJLJdXXo4rw

 

[krish44]

Reduction of interest rates is inevitable.

One has to think of shield even if a bit risky.

One has to have at least one investment which is inflation proof and gives reasonable return.

brains have to be put to work to identify that.

 

[Janaki Jambunathan]

https://www.google.co.in/url?sa=t&r...sUWmLfVNetYb2SVGw&sig2=G5_QALBCxAaBfXTcIVCMYw


Seems attractive! I donot have this investment I will think about it!

 

[krish44]

it is good but tax deducted at source. only one has to struggle with tax authorities to get refunds .

If you have a good tax lawyer who can handle your accounts ,then it is attractive

Otherwise I know many senior citizen especially VRS types who have opted for it

 

[Janaki Jambunathan]

it is good but tax deducted at source. only one has to struggle with tax authorities to get refunds .

If you have a good tax lawyer who can handle your accounts ,then it is attractive

Otherwise I know many senior citizen especially VRS types who have opted for it

IT department seems to be efficient these days 1 They setteled my refund dues for A.Y. 2008 -09 with dues 2 weeks back I have one more due for 2009 - 10 Pending with them and hope it is also setteled soon For the years latrer than that I got my refunds with out any problem!

 

[krish44]

IT dept has changed a lot. Now they are promising refunds in 8-9 days of end date of filing returns.

only if one has income from property or other sources than bank interest it gets a little more difficult

 

[krish44]

There are some more options for investing for senior citizens

One could think of ETF fund options

They are almost like mutual funds but charge lesser fees.

depending on ones fancies or needs one can choose ETF which invests in commodity[gold] , bonds [debt instruments] or index funds [dealing with equity index stocks].

they are traded in market . one can open a demat account and give orders for sell or buy. they are liquid and one can exchange them for money anytime for small or big amounts

there are funds which follow cnx nifty index or s and p bse index.The last named one is floated by UTI.

all these have small transaction costs and one can choose the extent of security one desires.

also this could be a stepping stone to learning about stock market trading,

 

[mkrishna100]

One could think of ETF fund options

ETF are a sensible option for most retail investors and they can buy them when the sensex / nifty crashes .

 

[zebra16]

ETF are a sensible option for most retail investors and they can buy them when the sensex / nifty crashes .

When US sub prime mortgage crisis and economic downturn was at its height, I read a well researched and written article (and saved the article too) in WSJ or NYT, which showed clearly that Exchange Traded Funds and Gold Traded Funds were not even microscopically better than the worthless share certificates (or their digital Demat forms). Unfortunately I am not able to lay my hand on that article now.

I will try to find the article and post its link if possible.

The author was quite emphatic that there was no substitute to Gold in its prime form of bars or coins or crowns or guineas to ward against money disappearing in thin air.

 

[krish44]

gold bars buried in courtyard of ones home is best for safety ,

one can plant tulasi on it and pray going around it

dig after a few years . you will see gold has appreciated in value while currency would have become worthless.

zebra wisdom

 

[zebra16]

gold bars buried in courtyard of ones home is best for safety ,

one can plant tulasi on it and pray going around it

dig after a few years . you will see gold has appreciated in value while currency would have become worthless.

zebra wisdom

.
There was no need for you to advertise that your top floor is empty. But full disclosure made by you is appreciated

 

[V.Balasubramani]

.

There was no need for you to advertise that your top floor is empty.

Sir,

 

[auh]

IT dept has changed a lot. Now they are promising refunds in 8-9 days of end date of filing returns.

only if one has income from property or other sources than bank interest it gets a little more difficult

IT dept functions like "poosanikai podhi mootai le pogumaaam aana urundu pora kadugu thaan kannukku theriyumaam"

 

[auh]

The author was quite emphatic that there was no substitute to Gold in its prime form of bars or coins or crowns or guineas to ward against money disappearing in thin air.

I doubt it. It all depends on which commodity is affected and to what extent (along with its related and interdependent commodities). Over time. Gold too has its ups and downs.

 

[krish44]

Gold has become as speculative as other commodities.

It is no longer a safe haven .

It has varied from 29000/10 gms [24carat] to as low as 20000. Now it is around 26350.

If one has to buy gold for ornament for a loved one, any price is fine.

Asin s fiancee Rahul presented her with 6 crore rs diamond ring.

But if you are thinking of it as investment, it may not be very wise.

You might end up losing money.

There are arbitrage oppurtunities in gold if you are buying in singapore or dubai . Even after paying indian duty you can get a big amount . besides the gold is of better

quality.If it is jewellery , in singapore ,one pays only making charges , no sedharam etc.

It is wise to Keep away from all commodities after the china crash

all commodity stocks have crashed in india.

Gold is not a safe haven as many might think

 

[sangom]

Since this thread is about Financial Non Traditional thoughts, how about India under Narendra Modi's leadership setting up an Asian Monetary Fund to compete with the IMF and making the Indian Rupee as its currency? That one step could solve most of our problems and our coming generations will be able to borrow and borrow and live happily...ever after. Any comments?

 

[krish44]

Since this thread is about Financial Non Traditional thoughts, how about India under Narendra Modi's leadership setting up an Asian Monetary Fund to compete with the IMF and making the Indian Rupee as its currency? That one step could solve most of our problems and our coming generations will be able to borrow and borrow and live happily...ever after. Any comments?

Emerging nations have been active in setting up BRICS bank . India is nominating its chief.

In terms of economics, india is one tenth of china in most parameters.In production capacity ,exports it can come nowhere near it.With all the excess capacity with

them and no domestic consumption , they have a structural deficiency. India has no worthwhile exports . It has been shrinking by 10 to 20 % in each of last three

months.

Its deficiency is perhaps its strength. Global issues will affect them less unlike malaysia or indonesia where growth is export lead.

India has an agricultural base besides a strong local consumption.

Its integration gives it a selective help in pharma and IT sectors. Otherwise India has no growth story. Only consumption story backed by agriculture which is failing

this year

 

[zebra16]

Since this thread is about Financial Non Traditional thoughts, how about India under Narendra Modi's leadership setting up an Asian Monetary Fund to compete with the IMF and making the Indian Rupee as its currency? That one step could solve most of our problems and our coming generations will be able to borrow and borrow and live happily...ever after. Any comments?

As you were working in RBI, you must have been aware of Asian Monetary Units and Asian Currency Union of 1970-1990 era with its HQ in Tehran. The central banks of the participating countries were its members.

Though it is still existing on paper, the basic idea mooted by UN to secure regional co-operation between member states was not possible to achieve because the major countries like India, Iran, Pakistan, Myanmar, Bangla Desh, Sri Lanka each had some scores or other to settle against their adversarial members.

Also Asia Monetary Unit (AMU) was pegged at the equivalent of U S $ 1. so still the system was slave to the U S $.

Without surplus countries like Japan and China joining, where would they have the money to lend to other borrowing countries ?