life is busy.. but knowledge makes it easy

After laptops its mobile for blast prone batteries

2007-08-16T01:23:00.000+05:30

After scares over laptop battery getting heating up and catching fire (dell), its mobile's turn now.
Yesterday nokia admits manfacturing defect in its 46 million batteries. The problem is confined to BL-5C batteries made by Matsushita between December 2005 and November 2006.

More than 250 million BL-5C batteries made for Nokia by other manufacturers are not affected, the company said.
The mobile giant said there had been 100 reports of overheating, and that the problem battery had been used inside more than 50 different phones.

In a statement, the company said: "Nokia has identified that in very rare cases the affected batteries could potentially experience over heating initiated by a short circuit while charging, causing the battery to dislodge."
Nokia said there had been no reports of "serious injuries or property damage" as a result of the overheating.

People Can check on the Nokia's website about their battery, and get it changed as soon as possible.

Nokia has promised replacement of batteries free of cost.

Although this may affect the reputation of the company but one must admit that this is a good decision for long run of Nokia.

The BL-5C batteries which are subject to the product advisory were used with the following Nokia models or separately as accessories:
Nokia 1100, Nokia 1100c, Nokia 1101, Nokia 1108, Nokia 1110, Nokia 1112, Nokia 1255, Nokia 1315, Nokia 1600, Nokia 2112, Nokia 2118, Nokia 2255, Nokia 2272, Nokia 2275, Nokia 2300, Nokia 2300c, Nokia 2310, Nokia 2355, Nokia 2600, Nokia 2610, Nokia 2610b, Nokia 2626, Nokia 3100, Nokia 3105, Nokia 3120, Nokia 3125, Nokia 6030, Nokia 6085, Nokia 6086, Nokia 6108, Nokia 6175i, Nokia 6178i, Nokia 6230, Nokia 6230i, Nokia 6270, Nokia 6600, Nokia 6620, Nokia 6630, Nokia 6631, Nokia 6670, Nokia 6680, Nokia 6681, Nokia 6682, Nokia 6820, Nokia 6822, Nokia 7610, Nokia N70, Nokia N71, Nokia N72, Nokia N91, Nokia E50, Nokia E60.

*Nokia.com
*BBC news

How Federal Reserve Systen can fight with depreciating Dollar value?

2007-08-11T03:32:00.000+05:30

There are many ways in which Federal Reserve can control Dollar value through Federal Open Market Committee (FOMC):

1. Reserves of Major Currencies.
US has big reserves of all the major currencies in the world, if needed they may unload all the reserves to BUY back depreciating Dollar to strengthen Dollar.

2. Special Drawing Rights (SDR)
These are the rights given by IMF (International Monetary fund) to withdraw money from IMF. It was special formula used to setup BOP (Balance of Payment).
In 1960-70 SDR was most famous exchange mode.
These rights are given to US because US is largest contributer in IMF (40% approx.)

3. Gold Stocks
US may use it's gold stock to buy back dollar by selling gold in International Market. It happened in 1979 under President Karter when US sold gold worth $7 billion.

4. Money Supply
By Regulating money supply in market through regular mechanism increasing Rates to absorb money from market and decreasing Rates to increase money supply.

Printing Money is not a feasable option everytime. Money is printed through proper Mechanism.
People->Bank->Federal Reserve---->Printing Money

People informs bank and Banks passes on the message that their is need for Money to Federal Reserve and they Print Money.

Monetary policies in USA

2007-08-11T00:54:00.000+05:30

Few days ago i attended a lecture about monetary policy in USA. Although it doesn't have any relation with India, but to know about world's greatest economy is somehow relevant..
Lecture was by Kishore ji Kulkarni...

So let us discuss what is the importance of monetary policies be it in US or India.
Monetary policy is the process by which the central bank, or monetary authority manages the money supply.
It is must to have a proper system. A e.g. for bad management is Brazil when authority increased money supply by 800% and there was 60% inflation every month. Imagine buying same product next day at higher and higher price.

A Proper System is required, in India its Reserve Bank of India (RBI) and in US its FRS Federal Reserve System Started in 1913.

Federal Reserve System(FRS) has three main components:
1. Board of Governor (BOG)
2.Federal Open Market Committee (FOMC)
3.Federal Banks

1. Board of Governor (BOG)
It has 7 governors appointed by US president with 14 years non-renewal tenure. They are selected in such a way that every 2 years one goes out and one comes in. So president of US mostly get right to select 2 governors in his tenure. That is why govt. doesn't play a big role in monetary policies of US.
Out of these 7, one is selected as Chairman, and he is considered most powerful person in this world because he can affect the money supply of Dollar. Chairman is selected for 4 years (renewable). Current Chairman is Ben S. Bernanke appointed till January 31,2010.

Decisions of BOG
1.Value of LRR (Legal Requirement Ratio). It is somewhat similar to CRR (Cash Reserve Ratio). It is amount which banks which they have to keep as reserve. This ratio is rarely change.
(like in case of emergency)
2.Serve in FOMC

2.Federal Open Market Committee (FOMC)
It has 12 members (7 governors). Rest 5 are from Federal Reserve Bank. One is from NY Federal Bank. Rest are from remaining 11 Federal banks. NY is permanent member as it has 40% share in Federal Reserve System.

Basic Functions of FOMC:
1.Open Market Operations- Buying and selling of Treasury bonds
2.Change in Discount Rate- IT is Rate at which federal banks lend money to commercial bankers. Up to 1991 it was rare to change it. Last year it was record 6 times (now common 4 to 5 times). Currently it is 6.25%(PLR). As it is Quite low it is provided after strict verification
3.Emergency-change LRR (last in 1979)

3. Federal Banks
There are total 12 Federal banks. Federal banks:

Boston
New York-Main Federal Bank
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco.

In an all we may say that " US plays no role in monetary policies formation" is a myth:

Because US govt. has decided that pay of chairman of board of Governor cannot be more then President of US ( $4,50,000). So most of the times these Governor because of their intellectual level get offers from Investment banks with much higher pay.

So most of the times president have to select more then 2 members. In fact last time when this happened that President selected only 2 Governor was in 1963 under John F. Kennedy. So we can say that govt. do play role in monetary policy as well.

Credit Policy-CRR hiked by 50 bps to 7%

2007-08-01T03:23:00.000+05:30

The key takeaways from the policy are:

RBI hikes CRR by 50 bps to 7% from 6.5% from Aug 4
RBI keeps all other key rates unchanged
RBI removes Rs 3000 cr reverse cap from Aug 6
GDP forecast for FY08 retained at 8.5%
Has discontinued second auction of the day
Hedge Funds pose significant risks to markets
Financial stability added to monetary stance
Emphasis on price stability, anchored inflation expectation
Uncertainty over supply situation has increased
Inflation pressures seen from liquidity, high credit
Global inflationary pressures stronger than before
Inflation threat from re-emergence of producers' price power
Medium term target of inflation-4-4.5%
FY08 target of inflation-5%

The Reserve Bank Governor Dr Yaga Venugopal Reddy announced a 50 bps hike in the CRR rates, raising it to 7% from 6.5% in his Credit Policy announcement today.

Other impacts could be deposit rates likely to come down and lending rate may remain same.

*moneycontrol.com

Tendulkar crosses 11000 in tests

2007-07-31T02:52:00.001+05:30

On Saturday July 28, Sachin Tendulkar in his 139th Test became First Indian and third in the World after Brian lara(11,953) and Allan Border(11,174),to reach the milestone of 11000 Runs in Tests.

Addiction for Future Trading

2007-07-31T00:43:00.000+05:30

Basically let me start by explaining what Addiction really is.According to Joseph Frascella of US National Institute on Drug Abuse(NIDA) to the 'Time' magazine recently,"are repetitive behaviours in the face of negative consequences,the desire to continue something you know is bad for you"
So basically this is what happening in small towns and villages where small money lenders , farmers and even labourers try to gamble on commodity market even when they don't know the ABC of the market.Its like the same rush happened in early 90's when uninformed traders tried to put there money in Stock Market in hope of fast bucks and ultimately they got there fingers burnt.
Same is the case for small villages,their are cases when people committed suicide just to escape their debts.
It is always advisable to invest your money in the field where you have knowledge,their is no point going crazy for those red and blue tics on the terminal and losing all your hard earned money.
This is not the case of one or two villages its about whole India.From outside its seem fascinating to enter into market and investing in pulses,gold,silver,crude,etc. But if you don't possess knowledge its like playing cards with your hard-earned money.Even in cities like Delhi, i have seen people doing nothing and sitting on terminal daily and losing their hard-earned money on the calls given by their brokers.They follow their brokers with eyes closed and ultimately suffer. Due to this Addiction not only you, your loved one's also suffer.

ADVICE:DON'T ENTER A FIELD UNLESS YOU KNOW IN&OUT OF THAT FIELD

References used:
*Times Of India
*'Time' Magazine

Magic of Compounding

2007-07-29T01:33:00.019+05:30

“Compounding is the eighth wonder of the world.”
- Albert Einstein

Small things leads to big things in life.. and that's very true.
In real life we ignore the importance of small savings which we can make.
let me give you an example
let me take example of my Friend Sandra. He use to have one packet daily of Classic mild. That cost around Rs.50 per packet.

Daily expense=Rs.50
yearly expenses=Rs.50*365=18250

now let us assume he invest this amount for next 25 years:

Instrument Return
Bank 7%
Nifty 15%
Equity 20% (we have to assume.. but these are rational assumptions)
Mutual fund 30% (we may assume.. they do meet their target)
after 25 years:
Bank 18500*{(1.07)^25-1/.07}=Rs.11 70 107
Nifty 18500*{(1.15)^25-1/.15}=Rs.39 36 670
Equity 18500*{(1.20)^25-1/.20}=Rs.87 31 650
M.F. 18500*{(1.30)^25-1/.30}=Rs.4 34 42 861

That's the magic of compounding.. imagine mere Rs.50 per day could fetch you Rs.4.5 crores after 25 years.
Now, i dont think i need to tell.. what we can do with 4.5 crore.. Atleast this is the thing everyone can do...[thinking about ferrari ;)]

Imagine we took the example of meagre Rs.50. We spend more then that...isn't it?

All this looks really easy.. but you sincerely need to make an effort to make it large.

If i give you example from my own life..
In my library i use to return my books after due date,my fine was just Rs.5.. i use to think i can easily pay Rs.25-30 in return i can keep the book..but librarian did not collect anything..i was more happy.. i use to keep books for more longer time.... immediately before exam.. we need to clear-up account.. i had to pay Rs.750. At that time i felt bad as that amount had quite bigger impact on my pocket.
That day i learned

regular saving+earning on savings=a big amount(really big..isn't it??)

Plan of action

2007-07-28T04:24:00.000+05:30

Mastery in Financial World.(Finance,economics)
Sharing my skills.
Get support of faculty.
Write a Book.
All these+Hard+Smart work+Will Power=Platform-->Success.

dreamer

Something about myself

2007-07-28T04:14:00.000+05:30

Its been hard where i am now days.Life is really busy as i am pursuing my MBA from one of the Schools in India.
A total freak for Stock Market. thats what i Call myself....
it excite me allot..but i made reasonable loss in Stock Market last year.. this year i decided not to get into market. Atleast not without preparation.

Market is really full of bulls and bear. You must know how to fight them or they will ruin you.

So now i am preparing myself for another fight which may start after 2 years time.This time i will take the bull by it horns.

All my efforts will be here on these blogs.. and you will see on these blogs how to make life large.

dreamer

Introduction to life

2007-07-28T04:02:00.000+05:30

Life is all full of dreams... isn't it???
I hope you all will agree with me... and my only reason for posting these blogs is.. that i am chasing my dreams..
we must accept the fact that their is no free lunch in this world..their is nobody for social work here in this world.. unless you are exceptional case like Mother Teresa. Nothing to hurt the feeling of followers,i also respect Mother Teresa allot.

Even i m posting these blogs for my self interest. Their is no point i will read long articles from Financial times or Economist just to make you more knowledgeable.Its that i want to improve my article writing skills,my knowledge about the world.
Accept the fact that nothing comes free.. you have to pay the price for everything.

dreamer