More questions that I cannot answer…
A few financial dilemmas that have been plaguing me. Frankly am looking for an answer! Here they are:
1. How long will IT companies enjoy 30% margins and 30% p.a growth rate for the work that many of them do? Ok. Make that 15%. Is that sustainable if the currency were to get stronger?
2. How long will there be disparity in salaries in India. High end salary islands like IT, Media, Financial services, etc. vs. currently poorly paid sectors like manufacturing, mining, agriculture, etc.
3. How long will HR pay such a high premium to “English speaking MBAs” – while it is much easier to recruit fresh graduates and spend 6 months (okay 3 months) to teach them English and some basics to sell mutual funds, soap, life insurance, and car loans?
4. How long will the shareholders of financial majors tolerate the non-earning of the mutual fund and life insurance arms? Oh ok Iam sorry they are EXTREMELY PROFITABLE…hey just a minute, how long?
5. Why do we have 44 mutual funds with 5000 schemes if only 5 of the fund houses are making profits?
6. Will gold keep rising when aluminium and copper are falling? How many kilos of aluminium can be got for a kilo of gold? Or how many kilos of copper can be got for a kilo of gold? Will the long term ratios (of comparative prices) go for a toss?
7. How long will people chase above average returns – in spite of so much evidence against it?
8. How long will the salaries of a teacher be Rs. 200,000 a year and fund manager get Rs. 2,67,000 for every working day?
9. How come Mutual funds crib about TER and have some of the poshest offices? ditto banks, ditto Life insurance Head offices?
10. If inexpensive IFA community vanishes will the mutual funds HIRE EXPENSIVE PEOPLE?
11. Why is SEBI not putting a cap on the rent that an AMC can pay? Just asking, not kidding.
12. Why is it not compulsory for the Regulator to invest in the markets that he is supposed to be regulating?
13. What proof that the regulators are not vendetta seeking?
14. Distributors who did not respect people in their past avataars should not be surprised that today they are being kicked around for poor past behavior?
15. Has the ULIP become a great product now that the regulator has reduced the charges? really? why no fund manager portability?
please answer them….waiting for good bankable ideas!
Rupali
Awesome post (again). Extremely relevant “Cut to the core” questions. It is crazy how ignorant people are about finances when they spend majority of their lives working for money ,how shamelessly that is exploited by Finance Industry in India and God only knows what regulators do.
GS
One of my favorite post! Huge disparity and confusion for Investor.
And there is no answer 🙂
mh
Gold has negligible use as pure commodity. Gold is money. When we talk of ratios with respect to price of Gold, we should also look at the price of health,education and all other goods and services as a whole.
It is not that price of Gold has increased; it is the value of Rupee and Dollar that has decreased.
Till the time we have Governments all over the world increasing currency units by printing notes or creating numbers in a computer somewhere, the bull case for Gold still holds; even though there may be technical corrections on the way up.
Murali
How long will the salaries of a teacher be Rs. 200,000 a year and fund manager get Rs. 2,67,000 for every working day? Nothing much to say 🙁
Deepak
((How long will there be disparity in salaries in India. High end salary islands like IT, Media, Financial services, etc. vs. currently poorly paid sectors like manufacturing, mining, agriculture, etc.))
Isn’t this the natural cycles across industries and newer sunrise industries coming up and ending up sunset industry. Also bring up trickle down system.
lakshminarasimman
How long amma will be in hospital
Pi
@ Murali
You are comparing the salary of a low level teacher (like primary school, or not so good teachers in higher classes) with the best earning fund manager. I know teachers making around 15 lakhs-20 lakhs a year from salary only as well as teachers who take competitive exam tuitions who earn in crores.. I also know fund managers earning 20 lakhs a year. Hope that brings some sanity to an otherwise outrageous sounding salary disparity.
Waterboy
@ Pi,
You see a tiny subset. It seems you have a microscope before your eye.
Pi
No waterboy. I am saying do a like to like comparison. For one, fund management, i banking, private equity etc are high earning jobs. Why compare them to the lowest rung teachers. Good teachers earn reasonably well.look at salaries of top private institutes like, say ISB, XLRI. But Murali chose to compare it with a teacher earning 2 lakhs.
Secondly, to the best of my guess, not more than one or two fund managers in the whole of India will be getting a salary of 2.67 lakhs for each working day. Are we saying the best earning teacher in india (coaching included) doesnt earn in crores?