Money from equities

who makes money from equities and why is so much money chasing this field:

1) American domestic consumption fuelled by the housing boom ( now going into a bust). The boom was primarily due ot very veyr low interest rates which meant that you could buy houses. You sell those houses at a profit and consume the money.

2) who was providing the money for this.. the world is willing to, becuase they need a stable place to invest. which means that the us has a very high capital account deficit. ( their trade balance aint doin too good either coz of the higher oil bill)

3) so no one produces anything in america and the bank says so mcuh so that all debt values are known. so the money geos ot markets where there are lot of variables like in asia

4) hedge funds want alpha returns and this is available only in volatility :)

companies->anlaysts->funds->investors

companies-> pvt placement

there are a lot of other channels for money to flow in and out.

will keep writing in

kite runner

the book by khalid hosseini is one of hte good books i have read recently. thought provoking....you are acutlaly drawn into the setting, you imagine hte scenario's as its unfolding, feeling good bad, torn and look for redemption in the end. teh characterization of people leaves no doubt to how the world would be when seen if the talibanesque style were to succeed. but as the cab driver says, you have seen only one afghanistan. our world views is also determined by what we have seen, not as much by what the reality is. When the two intersect we are left numb by the acts of violence. When you meet people like assef and their world interwines in yours, thats when true violence stares in your face. And what about redemption, Amir found it, but many people would never probably find it in their lives. They would just be thinking about hte time s they could say... for you, a thousand times over.

Equities

Equities as an asset class are wierd at worst and extraordinary simple at best. Company makes money and its stock should be a value of that and the future cash flows possible right ? But it doesnt work that way-the movement of the stock is purely determined the kind of press the industry generates in the short run, and by the number of hedge funds that are present in the market the short run ( 6 months) can give the weak a heart attack. Add to this the day trading speculators and you have a good cuisine to ruin your blood pressure. But the long run price very much factor of the additional money a company is able ot add to its shareholders. As buffet says Options and futures might just be speculative investments, as I am getting involved inthe market, i understand they are an important aspect of price discovery. The amount of risk that options enable you to diversify ( or speculate) or put your money in equities means that they would always exemplify the overall equity risk. will write more on this. Schumi retires, fed ex moves on, sachs is the largest hedge fund, man are we moving or what ? :)

Reviews

House of flying daggers:
Dunno what exactly the movie was trying ot represent. Shot in amazingly beautiful locales for an extremely pathetic or no story line at all, it shall remain one of the movies that i would want to forget.

Plot: The house of flying daggers is a cult who is against the govt. Torn in this struggle is a young woman who is captivated by the man who she is supposed to kill Pathetic dubbing later we realize she is dead and the seasons are changing.

Munnabhai: Feel good over and above all and likeable.

killing of prof

Akhil Bharat Vidyarthi Parishad (ABVP) ... hmmm.. its a pity that i am starting my updates from bombay with this 'esteemed' organization. Their activities include

1) Getting classes closed because one of their brethren was fined( coz he bunked too many classes)

2) Agitation and clashes with authorities

3) The erstwhile platform ot be a youth BJP leader.

In Hyd ABVP is a part and parcel of life. If you are from OU then you have heard of them. Nizam's used to be their nest. You learn to live wiht them. Their right wing fanaticism not withstanding they were a menace at best, but toothless and they did get some of the things right. Their anti-ragging campaign for one( the hostelers would not vouch for it tho). It apparently started out as a student movement which wanted to keep alive hte swadeshi spirit in students and look after student interests against vested interests. Considering many of hte students come from poor backgrounds and have a chance to be exploited a noble cause indeed. But what it has now become is a hooligan hotbead at best and at worst the microcosm of the apathy of the student community as a whole.

The fact that they keep beating up or getting into scuffles with vice-chancellors et all is pretty well known, but going to the extreme of killing a professor? Why is the reaction not swift. After all this is not a professor whose killing we all accept because thats what he deserved (leave alone the ethics/morals of that). Where are the culprits? the BJP sarkar, the bastion of the old teachers(from lahore) and all the people who have some sort of justice in mind should probably book all the students who were involved under 'the intent of murder'.

And this in the time when higher education is in a state of flux. Lots of students, no teachers. Who will come in? Again only the elite private institutions will benefit from this in the long run.

We have to see else we shall be the next victims.

UPDATE

Its been a long three months since I last made a post. Basically no access from office and I am too lazy to do it from any other place. What has been up with me? I have let Mumbai get into me more and more in spite of living a semi campus kinda existence. Used to live for a long time with kishore for about 3 weeks still I found a place close to my office. About 15 min s walk from my office ( which itself is beside one of the best malls in Mumbai In orbit ). My job ( funny I am thinking whether they would do a blog search sometime) is at a KPO basically taking advantage of time zones and the pay difference. Time with kishore went of pretty fast till he moved on to the US about 4 weeks ago( hmmmm july 31st, life moves on fast I guess).

Office is a series of cubicles with enough space for 2 people and divided over 2 floors. I used to wrok on the chill floor ( no boss) till I had no work and now since I am full time into work I don’t bother where I would sit. The times have been very interesting, have met a lot of great people during the last 2 months and some may last till a long time. I still keep up the conversations’ with all the junta from campus ( err… not all I guess), but that would decrease now I guess. My personal life hehehe that would go for a toss soon I guess. Things change. I just don’t get it why it should change most of the times. Well, maybe I am not in with the crowd I guess.

Now for the first time, I am actually working and I am forced to take a look at things around me. So from now on I have decided that my blog would also contain stuff that I think about but never find the time to think through. Lets see how many days I manage to keep up the enthu.

ze trip

spent the last 1 week in chennai/blore.

Chennai:
My age old impression of chennai changed a little bit for the better

this time around. The people are coming in, the public transport is

decent and the people err. the mass rules. The centre for reservation

exists in chennai ( it was the first state to have pro reservation

demonstrations :D) and it seems the movement will only get stronger.

God save the king. I have always thought of chennai as the land of

dichotomy. On one hand you have hte leading political parties going

gung ho about atheism etc and on the other hand you have a spectacular

pouring of faith every morning. But its mostly the women that i have

observed, thats one thing across TN you find hardworking women and

loitering men. The men have things like politics, booze and caste to

discuss, while the mortal women are left to think of issues like

rearing up children etc. Caste is very clearly in, and people from

marginal voting castes will soon be out of tamilnadu unless htey are

extremely rich, extremely brilliant or both. The first withering state?

not yet, the institutions that the meritorious built are doing fine and

will do so for another 10 yrs and then the chaos would begin.

Me and sud spent the first day at prusty's watching champions league (

after his bro in law took us out for dinner on his bday), the second

night me ash and sud were at jeeths place after a night at ranjeeth,

and then the next day me spent at venkat's after he decided he dint

want ot travel to chennai ( our man if off ot spore ). After returning

from blore, i stayed for one more day for an intvw at Irevna( more on

that).

Chennai has srue changed ( i stopped noticing i think). I went ot

Tiruverikadu, the buzz is gone from the place. The sellers of religion

are there and so is the goddess, but i dint feel anything