Low Risk High Return Buy 5000 SHARES Of xxxx CMP Rs 7.80 TGT Rs 15 SL Rs 7.70 . Stock Raise Non Stop Till Diwali.” Over the past few weeks some of us would have got messages pushing this one stock.
As markets keep moving up, the frenzied calls and SMS texts that push up a particular stock increase in frequency. I don’t get emails or WhatsApp messages pitching stocks—just calls and SMSes. Some of the callers are really aggressive. Push back at them and they start snarling. Obviously they’re sitting on very steep customer acquisition targets. But we know from past experience that any kind of frenzy usually ends badly. If you gave into the frenzy of real estate a few years back, you’re looking at a nominal erosion of 30-40% of the price you paid. An inflation- and mortgage-cost-adjusted loss will be closer to 50-60%. Frenzies are unsettling. You lose your equilibrium. You get pushed into doing things that you normally won’t do. If you find yourself thinking of suddenly moving money into one stock or one mid-cap mutual fund on a tip, you know you’ve succumbed to the frenzy. Otherwise I’m-safe-in-an-FD (fixed deposit) people are suddenly discovering their risk appetite and want to invest right away on a tip.
To play the policeman is the oldest trick in the fraudster’s book. Delhi’s residential areas have seen a spike in crimes where two policemen stop an old woman and admonish her for wearing gold jewellery when there is so much crime in the city. They get her to “keep it safely” in her bag in a piece of cloth they give her. In the process, they switch the bundle and leave her with bits of stone. Something similar is afoot in the financial sector. Many of us get mails in the name of the banking regulator inducing us to share our username and password of the Internet banking account or telling us that we have won a lottery. There are calls from people pretending to be from the insurance regulator promising a bonus if the customer buys a policy or getting people to switch from an existing policy to a new government-guaranteed one. And now there are stories of money being collected in the name of the pension regulator using the national emblem and the logo of Pension Fund Regulatory and Development Authority (PFRDA).
Expense Account, Mint
The last year has seen a few (well, okay, just two) financial sector chief executive officers I know question their Rs3 crore remuneration packages, even as their peer group races ahead for that “bonus at any cost” management mantra. Those racing forget, of course, the old Indian adage that the shroud has no pockets. Parallel news of greed from the US sees some frenzied sewing of pockets as we hear of taxpayers paying companies to take luxury junkets and multimillion-dollar bonuses from companies still on taxpayer-funded life support. How is it that a small group of people have been able to corner so much of the world wealth? Is it some special skill, some special attribute that allows sellers of coloured soda water or creators of products nobody can understand to earn exorbitant numbers? Not just while they work, but even when they bail out for errors that cost investors, employees and customers losses and hardship. How did the manager get so powerful?