|» INVESTING IN INDIA|
And below that, in black letters:
Every year in London there are 100's of rapes andThen in red again, this time not in bold capital letters:
Don't become a victimAnd again in bold capital (but smaller font size) red letters:
REMEMBER NO TAXI SIGN MEANS IT'S NOT A TAXI.The Taxi was written in the logo that adorns the black taxi cabs of London.
--------------------- Now Equitymaster is on Facebook! ---------------------
We are on Facebook... Finally!
So go ahead, become an Equitymaster fan and start receiving regular updates right away!
Click here and be our fan!
Should Finance Companies carry a Warning sign?
I was, to say the least, impressed by this blunt and clear statement.
This statement was obviously not drafted by a lawyer.
Nor was it drafted by members of the various sub-committees set up by well-intentioned regulators and central banks globally; sub-committees that are dotted with familiar names and whose members seem keen to pacify their friends and business clients in the financial world.
A recent example of such a sub-committee in India: the respectable and well reputed people who devoted their time to re-examining the issue of the net worth required to be in the business of fund management, stock broking, or investment banking.
Of course, a few people did not bother to attend these meetings, but they happily signed on the dotted line to support their business relationships and friendships.
In the US, their government has just spent months of time debating and adopting new laws for the financial services industry. I don't know how long this new Act is, but I doubt there is a line that says: WARNING, YOU ARE DEALING WITH COMPANIES THAT HAVE TIME AND AGAIN ROBBED YOU OR ATTEMPTED TO ROB YOU AND IN MANY CASES HAVE BROKEN THE LAWS, BUT THEIR LAWYERS ARE SO GOOD AND THEIR POLITICAL CONNECTIONS ARE SO STRONG THAT THEY GET AWAY WITH THESE CRIMES BY PAYING A FINE NORMALLY EQUAL TO 30 BUSINESS DAYS OF PROFITS FROM CHEATING INVESTORS LIKE YOU. WHILE WE DO NOT HAVE ANY INFORMATION ON HOW MANY PEOPLE HAVE BEEN RAPED OR KILLED FROM SUCH ACTIONS, WE KNOW THAT FAMILIES HAVE LOST THEIR SAVINGS AND WE RECOGNISE THAT THIS MAY HAVE LED TO SUICIDES, BROKEN FAMILIES AND SHATTERED LIVES. SO BE CAREFUL AND ASK YOUR FINANCIAL ADVISOR FOR A LIST OF WRONG ACTIONS HIS/HER FIRM HAS PERFORMED OVER THE PAST DECADE. (There may not be enough paper in the world - or server farm capacity at Google - to list all the wrong actions they have performed over longer time periods, so we will have to settle for the past ten years!)
If you think I am exaggerating you should read books written on the recent financial meltdown in the US, on the internet bubble, on the blow up of hedge funds like LTCM - or Google this stuff on the internet and read what the newspapers had to report when all these messy things blew up.
Tobacco kills your lungs, we destroy more
Given that I am not a taxi driver but I am in the field of finance, I was wondering if it would be good for every finance company to carry such a blunt and frank statement with their advertisements and billboards.
And also paste them prominently at the end of every TV show or newspaper article or internet report written in the media by reporters who either play along with "the story" or get fooled into helping spread false claims and images.
Right now there are those long lines of statutory disclaimers on offer documents and IPO stuff that pretty much no one really reads or understands.
The tobacco companies were forced to have skull sign and a large WARNING TOBACCO KILLS printed on their boxes of death.
Investing your money based on the advice of a financial company is probably as dangerous for your health. And your life.
But, you may argue, despite the tobacco warning, people still go ahead and light up their cigarettes for that desperate smoke.
The "risk" is that even if the finance industry was to be sweet-talked or arm-twisted into this WARNING label, the industry may still harm investors.
The job of the regulator (or the government) is to warn you about the risks, not to make you believe that it is a perfectly safe world out there. Because the world is not safe.
If you still go ahead and do silly things, that's your problem - not the regulator's problems. You need to act responsibly and take responsibility for your actions. The regulators' job is to set the framework and shut down those who cheat (but, as I pointed out, sometimes the lawyers are too smart or the political pressure is too much).
It's funny how an expensive taxi ride in a London taxi can teach you an inexpensive lesson - that is, if you really wish to learn.
So there it is: my warning to you.
Suggested allocation in Quantum Mutual Funds (after keeping safe money aside)