The law is not equal to all. To know why, read this:
– Subrata Roy Sahara has been a contemnor for 2 years now. The long rope given by SC wouldn’t happen for the aam Aadmi.– He had an NBW against him. He cannot ‘surrender’. He can only be arrested. But the media says, he has surrendered.
– He had been evading law. Any other person would be arrested and taken in police custody, and lodged at the station, based on his past behavior. Roy has been taken for a picnic in a forest guest house, a holiday at the expense of the state.
– the medical tests after arrest happen at a government hospital. In this case, the doctors came to his home for health check.
– The arrest was made at at 10.15 am. All jail manuals say that no prisoner can enter the jail after 5 PM. Roy was produced before the CJM at 5.30 PM, to ensure that police custody would not lead to jail.
– On thursday, The lucknow police carried a facade of a raid. By Friday, the Delhi police landed, worrying Roy. Lucknow is his own, as much as the administration. So, The lucknow police move in, and go through the farce of arresting him, to deny the Delhi police arrest and lodging him in Delhi jail.
– From 10.15 AM to 5.30 PM, the lucknow police looked like being in the custody of Roy than the other way around. They were at Roy’s home and Roy was not at a police station.
– In such cases, transit remand is the norm, as the Lucknow police are only helping the Delhi police in executing an order. They would want hand over the responsibility at the soonest. However, in Roy’s case, Lucknow police willingly took the onus on themselves to produce him before SC.
– The magistrate, ordered Roy to be in police custody(not judicial custody). This is meant to leave space for the police to take him on a state holiday. The magistrate did his job, while ensuring that Roy is protected for the next few days.
– The entire episode is in the cavalcade of Audis and BMWs. Not police jeeps and vans. It was clear that police were guests of Roy, and not the other way round.
– The Magistrate was made to wait for Roy till 5.30 PM. It was a court convened on a holiday because of Maha Shiva Rathri. The Aam Aadmi dare not do that.
– The fear of Roy is such, that the special public prosecutor suffered a heart stroke, while discussing the case with CJM. He has to be seen as correct but cannot upset Roy, like the CJM himself.
– His defense yesterday included Ravi Shankar Prasad of BJP and Ram Jethmalani (both in Supreme Court). It also included Abhishek Singhvi of Congress at one point. His administrative protection is from the Samajvadi party.
-wrote Peri Maheshwar
Category: Excerpts
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Priceless Advice from AQR’s Cliff Asness
One of the few things we do know is that over three to five years, pretty much everything has shown some systematic, if certainly not dramatic, tendency to mean revert (especially when one accounts for and avoids the powerful effect of momentum at shorter horizons). This means that when we rely on three- to five-year periods to make decisions—favoring things that have done well over this time period and shunning things that have done poorly (note the past tense)—we aren’t just using data meaninglessly; rather, we are using data backwards. Essentially, with a disciplined approach, value and momentum are both good long-term strategies, but you don’t want to be a momentum investor at a value time horizon.-from CapitalSpectator
“Most people do not realise how difficult the ice cream industry is. It is capital-intensive in nature with a long gestation period,” he says morosely. Top that up with a mediocre 2-3% net profit margin that most players in this industry, including Vadilal, bring to the table and the result isn’t as sweet as you’d expect. “It is so challenging that there is not too much money available to the promoters,” says Gandhi with a wry smile. What is available, though, is far from insubstantial — Gandhi’s income is not restricted to just his salary or dividend from the approximately 22% stake he holds in Vadilal Industries. “There is also some money that comes through partnership firms and royalty from the Vadilal brand,” he says, without giving away details.
And most of it, since the early 1980s, has been invested in land. More precisely, agricultural land. “People might think this is an unconventional kind of investment but it is one that has worked for the family. It started off as an experiment the first time and now this is a big part of our personal portfolio,” he says. It certainly is: land accounts for 80% of the Gandhi family portfolio, with the rest distributed in more predictable avenues such as FDs or cash, with equity being the smallest component. “Equity is a volatile investment and my mindset is not in line with that. Land is more stable and offers a steady return,” rationalises Gandhi
Gandhi’s views are just reflective of the state of the market that we find ourselves in: over the past five years, the Sensex has just about managed to yield around 16% return. As for the other asset classes, the recent National Spot Exchange fiasco has taken the sheen off commodities, while volatility has left investors with marked-to-market losses in fixed income as yields suddenly spiked when foreign investors pulled out money from the debt market. Against such a backdrop, the preference for real estate has continued, despite concerns of a bubble building up in the sector.
In the case of the Gandhis, at any point in time, the family owns at least 100 acres of agricultural land in Gujarat, at places such as Gota, Bardoli and Bavla. “We have sold about 10% of our holding to date for a reasonable return,” says Gandhi. “Reasonable” here is defined as 1.5 times the number of years the asset has been owned; that is, land held over a five-year period has given a return of close to eight times. The 10% that was sold was in the form of plots of 400-500 sq yards, apart from 15 fully constructed bungalows. Gandhi is no hurry to monetise the rest of his land holding. “It is not just about making money right away. This allows us the option of possibly looking at an area like property development at a later date. We want to keep our options open,” he says.
Gandhi is only one of the many wealthy entrepreneurs Outlook Business spoke with who were convinced of the merits of real estate, in one form or the other. Consider CK Ranganathan. “In the long run, I am convinced no asset class can beat real estate,” says the chairman and managing director of the Rs 1,000-crore FMCG rising star, CavinKare. As much as 95% of his personal wealth is in real estate, where Ranganathan prefers buying land to residential or commercial buildings. “Land offers the best returns,” he declares. The tilt towards this asset class came after he tried investing in stocks, financial instruments and commodities between 2005 and 2007. After the 2008 meltdown, the 52-year-old Ranganathan recalled his grandparents’ advice to him as a youngster. “They always advised me to buy land, and I decided that was the best thing to do. Asset allocation changed from 50% in stocks in 2007-08 to 95% in real estate,” he goes on to say. The remaining 5% is divided between gold and stocks.-from OutlookBusiness
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Warren Buffett on Banks
Hat Tip Sanjay Bakshi
[gview file=”https://alphaideas.in/wp-content/uploads/2014/02/Buffett-on-Banks.pdf”]
Many emerging market economies (EMEs) have
experienced heightened financial stresses since April
of last year. EME–dedicated international bond and
equity funds sustained substantial outflows, and
many EME currencies depreciated sharply against the
dollar (figure A). At the same time, EME government
bond yields rose abruptly and by much more than
U.S. Treasury bond yields. Financial conditions in
the EMEs generally stabilized after September, but
financial stresses have flared up again in recent
weeks, with many currencies experiencing another
bout of depreciation.The stresses that arose in the middle of last year
appeared to be triggered to a significant degree by
Federal Reserve communications indicating that
the Federal Reserve would likely start reducing its
large-scale asset purchases later in the year. Some
of the selloff in EME assets may have been due to
the unwinding of carry trades that investors had
entered into earlier to take advantage of higher EME
interest rates than those prevailing in the advanced
economies. These trades appeared profitable so long
as EME currencies remained stable or were expected
to appreciate. But when anticipations of a slowing
in the pace of Federal Reserve asset purchases led
to higher U.S. interest rates as well as higher market
volatility, these trades may have been quickly
reversed, engendering sharper declines in EME
currencies and asset prices.In December, when the Federal Reserve actually
announced a reduction in asset purchases, the
reaction of financial markets in the EMEs was
relatively muted. Then, in late January, volatility
in these markets returned. Unlike last summer,
there was little change in expectations regarding
U.S. monetary policy during this time. Rather, a
few adverse developments—including a weakerthan-
expected reading on Chinese manufacturing,
a devaluation of the Argentine peso, and Turkey’s
intervention to support its currency—triggered the
renewed turbulence in the EME financial markets.This turbulence appeared to spill over to bond and
equity markets in advanced economies, as market
participants pulled back from risky assets.
Both last year and more recently, the deterioration
in financial conditions varied across the EMEs,suggesting that, even as the selloff of EME assets
was in part driven by common factors, investors
nonetheless were also responding to differences in
these economies’ situations. Brazil, India, Indonesia,
South Africa, and Turkey are among the economies
that appear to have been the most affected. For
example, the currencies of Brazil, India, and Turkey
dropped sharply in the middle of last year, whereas
the currencies of Korea and Taiwan were more
resilient (as shown in figure A). And in recent weeks,
although EME currencies sold off broadly, EME bond
yields tended to increase the most in economies that
saw the largest rises during 2013.
To a considerable extent, investors appear to
have been differentiating among EMEs based on
their economic vulnerabilities.-from US FED Monetary Policy Report