January 2009 « What Ho!

12Jan/090

Ministers & Civil Servants Binge on Oil PSU's Funds

This report was published in an Indian newspaper on Jan 11, 2009. What can I say? Our so called Public Servants behave like our former colonial masters. They think that the nation and it's resources are meant for their private pleasure. Instances of Civil Servants manipulating the very system they are supposed to serve with humility are rampant. We expect our politicians to be crooks by default. However our civil servants who enjoy a large number of perks and are revered for their jobs are nothing but scum who thump their thumbs at the law of the land and get away with it. At least our politicians can be kicked out of office and routinely are.

Filed under: India No Comments

11Jan/090

Raju Da Dhaba

I don't know who created this cartoon as it was sent to me as an email forward. But I like it

(If I am violating copyright by posting this image here please let me know and I will replace with a link to the author's web site)

And here is a copy of the faxed letter sent by Ramlingam Raju, ex-chief of Satyam.

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10Jan/090

The Honest Man

Speaks for itself, doesn't it? R. K. Laxman does it again. The man has an uncany ability to get to the truth and expose it...

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6Jan/094

HDFC – Investment Plans with "Assured Gifts"

The following email was sent to an internal mailing list at work.

Hi Everyone,

I am posting this on behalf of my friend, "Vikas". Please do contact him in case you are interested in any of the HDFC Standard Insurance and investment plans.

Thanks,

XXXX

---------------------------

Hi Everyone,

Invest in HDFC Standard Life Insurance and get free ASSURED GIFTwith every investment plan.

1. Invest Upto 20,000 get Kodak KB 10 35 mm Camera worth Rs.500/- FREE.
2. Invest from 20,001 to 35,000 and get 5 grams Silver coin FREE.
3. Invest from 35,001 to 50,000 and get 1 gram Gold coin FREE.
4. Invest from 50,001 to 70,000 and get Onida DVD player FREE
5. Invest from 70,001 to 99,000 and get Apple Ipod Shuffle FREE.
6. Invest from 1,00,000 to 1,50,000 and get Washing Machine FREE.
7. Invest from 1,50,001 to 2,00,000 and get 21 Inches T.V. FREE.
8. Above 2,00,000 get a 10 grams Gold Coin FREE.

This offer is valid till 31st Jan'2009. Please call Vikas Sharma on +91 98481 92990 or email at vikass6@hdfcinsurance.in

Thanks,

Vikas Sharma.

An nice example of a Life Insurance Company selling it's policies by offering so called "Assured Gifts".

Lets see if we can understand this better. HDFC will sell you an "Investment Plan", which is another name for an ULIP. Because you bought their ULIP they will give you an "Assured Gift". There are 8 "offers" listed.

Lets look at the first and the last.

First Offer:
Assured Gift worth Rs. 500/- for investments upto Rs. 20,000/-
Immediate Return on Investment (in kind): 2.5%
Fine Print? What about an investment of Rs 5000/-? Is there any investment below the 20K level mentioned?

Last Offer:
Assured Gift of a 10gm Gold Coin for investments above Rs. 200,000/-
Value of Gold Coin: Rs. 1,620/- (appox per gram, taken from Kotak Bank's web Site)
Value of Gift: Rs. 16,200/-
Immediate Return on Investment (in kind): 8.1%
(Check International & Indian Bullion Rates)

Cool eh? Great What? You get money back immediately! And all for buying an "Investment Plan" from HDFC!

But where did this money come from? Is a "Return On Investment"?

The short answer is no! It is your own money. Returned to you instead of being invested. Essentially the Broker / Insurance Company is returning a part of the fees they would otherwise charge you for the "Investment Plan".

Ask yourself this - How come these guys are able to return 8% of total value invested? How much of my money are they actually pocketing such that they can give me back a cool 8%? What is the actual cost of this so called "Investment Plan"?

Note that this 8% is not invested in the traditional sense. The Gold coin will of course appreciate in value but not as much as Equity. So if you had invested the same amount of money, namely Rs. 200,000/-, in Mutual Funds, all you would have paid is a 2.25% fee if you are too lazy to fill out the form. If you are not lazy and want your money to work as hard as you did to earn it, then you fill out your own forms and invest the entire 2 Lacs and enjoy a nice return that no ULIP can match.