Britain - ‘triple-dip’ recession...?????

Britain on brink of ‘triple-dip’ recession

PTI

LONDON, JAN 25: 

Britain’s economy shrank 0.3 per cent in the final quarter of 2012 and recorded zero growth for the year as a whole, official data revealed today, placing the country on the brink of a “triple dip” recession.

The British Finance Minister, George Osborne said he was “determined to confront” the economic problems facing the country, which he claimed had been hit hard by the high debt inherited by the government and owing to eurozone strains.

“After growth of 0.9 per cent in third quarter, the economy contracted by 0.3 per cent in the fourth quarter of 2012,” the Office for National Statistics (ONS) said in a statement, adding that gross domestic product growth was flat over the year.

“GDP is estimated to have been flat between 2011 and 2012,” the ONS said.

Should Britain’s economy shrink also in the current first quarter then the country will enter its third recession since the 2008 global financial crisis.

“Given that a technical recession requires two consecutive quarters of falling output, this is arguably not a true ’triple-dip’ yet,” noted Vicky Redwood, chief UK economist at the Capital Economics research group.

“But there are no hard and fast definitions, and another contraction in Q1 is quite possible anyway, especially given the snow disruption.”

Britain was hammered in particular by a 1.8-per cent contraction in its production and manufacturing sector.

Chancellor of the Exchequer, Osborne said the latest data was “a reminder today that Britain faces a very difficult economic situation.”

He added: “A reminder that last year was particularly difficult, that we face problems at home because of the debts built up over many years and problems abroad with the eurozone, where we export most of our products, in recession.”

“Now, we can either run away from those problems or we can confront them and I am determined to confront them so that we can go on creating jobs for the people of this country,” Osborne said in a statement.

Britain is not a member of the eurozone but has been affected by the neighbouring bloc’s ongoing financial crisis.

Activity has been hit hard also by deficit-slashing austerity measures from the nation’s Conservative-Liberal Democrat coalition government.

In recent weeks, major British retailers have either been forced to close completely or seek outside help to remain operational. DVD rental chain Blockbuster UK and music retailer HMV became the latest casualties last week, entering administration in a bid to stay alive.

Camera chain Jessops shut in early January after electrical firm Comet closed its 235 stores just before Christmas.

The IMF’s chief economist, Olivier Blanchard, had urged Britain yesterday to lessen the pace of its austerity programme because of the risk that it could fall back into recession this year.

Blanchard said Britain’s annual budget statement due in March would be a good time for the finance minister George Osborne to “take stock” of his programme of deep spending cuts and tax hikes.

http://www.thehindubusinessline.com/news/international/britain-on-brink-of-tripledip-recession/article4345182.ece?homepage=true

Credit Bubble seen BEWARE...

Credit Bubble Seen in Davos as Cohn Warns of Repricing By Christine Harper & Michael J. Moore - Jan 25, 2013 4:31 AM GMT+0530 

Goldman Sachs Group Inc. (GS) President Gary Cohn warned of a potential drop in fixed-income prices as bankers and policy makers in Davos celebrated surging demand for financial assets. Debt markets that have seen junk-bond yields drop to record lows may face a “substantial repricing” if interest rates spike or investors begin pulling money out of fixed income, Cohn, 52, said in an interview yesterday with Bloomberg Television’s Erik Schatzker at the World Economic Forum in Davos, Switzerland. The Spanish government attracted record demand for its 7 billion-euro ($9.4 billion) sale of 10-year bonds this week and Portugal sold five-year debt for the first time in two years. TheStandard & Poor’s 500 Index (SPX) topped 1,500 yesterday for the first time since 2007. “Markets are really giving the sign that progress has been made,” Martin Senn, chief executive officer of Zurich Insurance Group AG, said in an interview after a meeting of bankers and policy makers including Italian Prime Minister Mario Monti and Bank of Canada Governor Mark Carney. Senn said that he and his colleagues have to avoid becoming “complacent.” “I’m not concerned at this point of that because there’s a good awareness of the respective risks,” he said.

Resurgent Markets

For bankers in Davos, the resurgent markets come as a relief after four years of fretting over regulation and fiscal woes in Europe and the U.S. Investors have funneled cash into junk bonds at a record pace as the Federal Reserve holds benchmark interest rates between zero and 0.25 percent and buys back bonds to suppress borrowing costs. Morgan Stanley (MS) CEO James Gorman, whose New York-based firm helped sell Portuguese bonds this week, said in a Jan. 23 Bloomberg TV interview that central banks’ policies of keeping interest rates low aren’t creating asset bubbles. “I’d be hard-pressed to describe this as toppy,” Gorman 54, said. Low interest rates have stoked demand for riskier assets. Yields on dollar-denominated junk bonds dropped to an unprecedented 6.46 percent on Jan. 22, and prices rose to 105.6 cents from as low as 54.8 cents in December 2008, according to Bank of America Merrill Lynch index data.

The declining yields have created a potential for a “bond bubble” that could result in significant losses for debt investors, Fitch Ratings said in a Dec. 19 statement. Oaktree Capital Group LLC’s Howard Marks said in a Jan. 7 memo to clients that the “scramble for return has brought elements of pre-crisis behavior very much back to life.”

Portuguese Debt

Portugal, which is rated junk, sold 2.5 billion euros of five-year bonds through banks, the first offering of that maturity in almost two years. Spain, rated one level above junk by Moody’s Investors Service and S&P, saw demand for its Jan. 22 bond sale that was unmatched in the country’s history, Economy Minister Luis de Guindos said in Brussels that day. Buyers of fixed-income products must be told that “just because it is a bond doesn’t mean that it trades at par,” Cohn said yesterday. “At some point, interest rates will go higher again, and all of the money that has piled into fixed income over the past three years, some of it will come out,” Cohn said. “We will clearly be there to facilitate, we will clearly be there to provide balance sheet and liquidity to our clients, but ultimately, we can’t be the buyer of last resort.”

Cutting Assets

The 13 largest investment banks have announced plans to cut $1.03 trillion in risk-weighted assets, consulting firm McKinsey & Co. said in a Jan. 23 report. Inventory holdings of corporate bonds by top dealers have dropped about 40 percent from two years ago and are less than a quarter of their 2007 peak, according to data compiled by Bloomberg. “A lot of the banks have a new plan of de-risking their balance sheets, getting their risk-weighted assets down to try to improve their equity ratios,” Cohn said. “And I’m not sure that that capital can come back into the market quick enough” if there’s a sell-off, he said.

To contact the reporters on this story: Christine Harper in New York at charper@bloomberg.net; Michael J. Moore in New York at mmoore55@bloomberg.net To contact the editor responsible for this story: David Scheer at dscheer@bloomberg.net

http://www.bloomberg.com/news/2013-01-24/credit-bubble-seen-in-davos-as-cohn-warns-of-repricing.html

Mukesh Ambani, CHAIRMAN, RIL

24 JAN, 2013, 06.07AM IST, HIMANGSHU WATTS & SABARINATH M,ET BUREAU 

The people who run Reliance Industries

The Reliance IndustriesBSE -0.47 % stock has hit a 52-week high on strong results and a more amiable government stance on its gas project. There are still issues, like the 4G rollout. ET goes behind the storylines to trace the people in charge — formally and informally — of taking the Rs 3,39,792 cr company to the next level
The Ultimate Leaders
For all their generals and lieutenants in Reliance, the direction comes from these three. And, at times, their involvement can be totally hands-on
Mukesh Ambani, CHAIRMAN
Mukesh Ambani can spends hours watching leopards in a jungle—and he has adopted some tricks from the sleek predator's trade. "It doesn't take any risk. Whenever it sees it can make a kill, it rapidly makes the kill. It happens in a flash," he once told ET. There was stealth and surprise aplenty when he bought a licence for 4G services, or became a significant shareholder in East India Hotels, or when wife Nita took charge of the glamorous Mumbai Indians cricket franchise.
A formidable team helps Mukeshmake such decisions and, more importantly, follow through to steer the colossal, and complex, empire that he inherited from his legendary father Dhirubhai Ambani to new heights. In that team are family and friends, old aides and new professionals, business heads and 'environment managers'.
Depending on what the situation demands, this collective can offer street-smart solutions, clairvoyant market insights and hardcore professionalism.
Nita Ambani
The only woman in the top set, Mukesh's wife is called 'bhabhi' by one and all. Although she is best known as the woman who turned around the Mumbai Indians cricket franchise , Nita plays a larger role in RILBSE -0.47 % than is widely perceived. When brothers Mukesh and Anil were involved in a bitter fight for the Reliance empire, it was said that one of Anil's grouses was that Nita, Anand Jain and Manoj Modi mattered more in the company than him.
Nita played a key role in RIL's decision in 2010 to buy 14.8% in East India Hotels, where she is now on the board of the company along with Manoj Modi. She has also been involved in RIL's retail operations.
Nita made her mark as part of the team that built the Jamnagar refinery, particularly her initiative to transform the arid zone into a green belt with mango plantations. She is also the founder-chairperson of the Dhirubhai Ambani International School and is actively involved in the Reliance Foundation. A gracious host, Nita throws lavish parties at the new Ambani residence, Antillia, where politicians, cricketers and Bollywood stars rub shoulders.
Manoj Modi
His visiting card carries no designation. He does not officially head any business. And he's not on the board.
Yet, Modi is an inseparable part of every big move RIL makes and has a say in pretty much each of its businesses. There is no designated CEO at RIL, but if there were to be one, Manoj Modi—55, Mukesh's classmate from engineering college— would be the man.
MM, as he is called, is a hands-on, serial builder of large projects for Reliance: the Hazira petrochemical complex, the Jamnagar refinery, the first telecom business, Reliance Retail and, now, the 4G rollout. He won Mukesh's confidence with his execution of the Jamnagar refinery when he refined the art of dealing with vendors and contractors, often in an aggressive language.
Modi sees himself as a loyal lieutenant of Mukesh, and will growl or pounce on anybody who dares to go against the boss. Despite the turbulence in retail and 4G, Modi's star in RIL shines the brightest.
The Core Team These trusty hands drive either operations or functions
Nikhil Meswani, EXECUTIVE DIRECTOR
The elder son of Dhirubhai Ambani's cousin Rasiklal Meswani joined RIL in 1986 and has been on its board since 1988. He is primarily responsible for petrochemicals and taking RIL to the top 10 in this sector globally.
He holds about 279,000 shares in RIL. Nikhil and brother Hital each took home a salary of Rs 11 crore in 2010-11, the most after Mukesh.




Hital Meswani, EXECUTIVE DIRECTOR
Nikhil's younger brother joined RIL in 1990 and has been on its board since 1995.
He owns 212,000 RIL shares. He has executed several mega projects, including the Hazira petrochemicals and Jamnagar refinery complexes.
This soft-spoken Wharton graduate oversees the refinery and all other manufacturing units.




PMS Prasad, EXECUTIVE DIRECTOR

Among those outside the Ambani kin, Prasad is perhaps the most influential. He joined RIL in the late 70s and has risen to drive its cash cows—refining and exploration.
He headed the team that set up the Jamnagar refinery complex in 1999, and under his leadership, RIL made the biggest gas discovery in 2002.
Prasad went through a rough patch during the government inquisitions on its trophy gas block. He has since bounced back, with the oil ministry shedding its radioactive approach towards RIL.
His sophisticated style is a contrast to the street-smart interventions of Manoj Modi.

Alok Aggarwal, HEAD — FINANCE
Aggarwal manages RIL's cash pile of $15 billion. An IIM graduate and a former BankAm executive, he has an uncanny knack of raising funds even in a bad market. This conservative banker is also focused more on global risk-management.
LV Merchant, FINANCIAL CONTROLLER
An expert in paperwork, accounting & processes, he also has a role in promoter firms that hold RIL shares.
Harish Shah, PRESIDENT
Involved in budgeting, financial planning, back-office operations and sensitive cash matters
PK Kapil, EXECUTIVE DIRECTOR
Joined in 1996, after a long career in IOCBSE -0.67 %, to lead the commissioning of the Jamnagar refinery. Became a director in May 2010. Known for his earthy and amiable style.
The Environment Managers
They silently work the corridors of power for Reliance
V Balasubramanium, GROUP PRESIDENT
Balu, as he is called, was a part of the original 'ABCD' of RIL: Ambani, Balu, Chaturvedi, Dhirubhai. He was a top aide and fixer for Dhirubhai. He has retained considerable clout under Mukesh, but is no longer the one-man army he used to be. Chaturvedi, Nathwani and Nahata have moved up the ranks in government lobbying. Balu's clout has also diminished because of the decline in the number of south Indians in the bureaucracy.

Mahendra Nahata, BUSINESS PARTNER IN 4G
A key person in RIL's telecom charge, he wields influence in Delhi. HelpedRILBSE -0.45 % build bridges with Kapil Sibal,Mulayam Singh Yadav and the finance ministry.

Called the 'track-2 Balu': unlike Balu, whose approach is 'you are with me or against me', Nahata has a persuasive style



Shalin Tandon, VICE-PRESIDENT
Son of Sandeep Tandon— the former IRS official who probed RIL in the 1980S and then joined it. A trusted aide in international matters.
Rajesh Chaturvedi, AUDITOR
Regarded as the 'new Sandeep Tandon'. The son of former RIL strongman DN Chaturvedi (Dhirubhai's CFO) liaises in Delhi on taxation, customs and excise
Parimal Nathwani, GROUP PRESIDENT
The key hand in RIL's political liaison.
Has grown in stature after showing his clout in Gujarat, where most RIL plants are located.
Folklore has it that a CBI director was once declined a room at the Circuit House in Dwarka, in spite of a booking, as Nathwani was given preference.


OLD FRIEND & CONFIDANTE
Anand Jain

Once in the same league as Modi, and called Dhirubhai's 'third son', Jain is no longer actively involved.
Mukesh and he remain friends: they holiday together and Jain even drops in at Reliance HQ.


The Support Cast
These are executives, with formal titles and roles, and can be found in the organisation chart
V Srikanth, CFO
After 20 years in Citigroup, during which he became country treasurer, he moved to RIL in 2010. A chartered accountant in his mid-40s, he handles the company's voluminous treasury operations and is being groomed for bigger responsibilities.
Vivek Paranjpe, HEAD — HR
He left H-P to return to RIL in 2010 to replace the late VV Bhatt, who brought public sector managers. The mandate for Paranjpe, who had an earlier 10-year stint at RIL, is to hire and groom global managers.
Navin Wadhwani, HEAD — M&A
An investment banker of 20 years, Wadhwani is setting up a dedicated M&A team that will scout for acquisitions.
Atul Dayal, HEAD-LEGAL
His able handling of the legal issues RIL has faced lately, including arbitration in the KGD6 block, has gone down well.
B Srinivasan EXECUTIVE ASSISTANT to Mukesh Ambani
The Stanford-educated executive is involved in the teams that incubate businesses in the chairman's office before being carved out. Also liases with the press and the corporate communications team

The Business Runners
The heads and key executives of the four businesses are mostly professionals, including many expats
Oil & Gas
Walter Van De Vijver , PRESIDENT & CEO, Reliance Exploration and Production
Shell's former exploration head has piloted three shale-gas acquisitions
BK Ganguly VICE-CHAIRMAN, India Gas Solutions
Involved in D6 gas pricing, he looks at the gas distribution JV with BP
PK Verma HEAD OF OPERATIONS, KG D6
The ex-ONGC man handled the western offshore fields before K-G Basin
Tony Fountain CEO, Refining
25 years at BP, highest-paid British civil servant, he joined last January
Petrochem
Warren Wilder HEAD, Polymers
Former head of Malaysia-based Titan Chemicals, his mandate is to expand the global footprint of the polymer business
RD Udeshi PRESIDENT, Polyester
Played a major role in the early 90s, when RILBSE -0.54 % bought to build capacity
Ajay Shah BUSINESS HEAD, Chemicals
This IIT Kanpur grad learnt the ropes of the chemical business at Nocil
Anand M Parekh BUSINESS HEAD, Textiles
Came in 2007 from Arvind Mills and led the Vimal brand repositioning
Retail
Pankaj Pawar VICE-PRESIDENT
Once an executive assistant to Manoj Modi, he runs the retail show
Rob Cissell CEO, Value-Format
RIL lured him from Walmart China in September 2011 to crack retail
Shawn Grey COO, Value-Format
Cissell brought along Grey, who has spent 13 years in Walmart China
Bijou Kurien PRESIDENT & CHIEF EXECUTIVE-Lifestyle
At Titan, he built brands like Titan, Fastrack, Sonata and Tanishq
Darshan Mehta PRESIDENT & CEO, Reliance Brands
The apparel industry veteran has sewed up many brand partnerships
Brian Bade CHIEF EXECUTIVE, Reliance Digital 
Heads retailing of consumer durables and electronics, and Apple iStore
Gopalakrishnan Sankar CHIEF EXECUTIVE, Reliance Footprint
The IIM-A grad heads footwear retailing, home decor and furnishings
Telecom

Jyotindra Thacker HEAD OF IT & MEMBER of 4G team
Relative of Manoj Modi, he heads IT systems and think-tank for 4G
Kiran Thomas VICE-PRESIDENT
Works closely with Manoj Modi on new projects
Mathew Oommen PRESIDENT
Held key positions in Reliance Infocomm & Flag Telecom before leaving. Now, he works closely with Thomas on consumer and handset strategy

http://economictimes.indiatimes.com/news/news-by-company/corporate-trends/the-people-who-run-reliance-industries/articleshow/18159646.cms?curpg=3

Rs 61,000cr investor money blocked

Wed, Jan 23, 2013 at 13:42

Over Rs 61,000cr investor money blocked in suspended cos

Research firm CNI Research says a whopping Rs 61,000 crore of investor money is blocked due to suspension of companies for various reasons at the bourses.

Moneycontrol Bureau

Research firm CNI Research says a whopping Rs 61,000 crore of investor money is blocked due to suspension of companies for various reasons at the bourses.

In the year 2009 (Nov 17, 2009), CNI had done an exclusive study on the companies, which were suspended from 1992 till 2009. In the study report, CNI found that around 1450 companies were suspended out of which for 574 companies (536 BSE and 38 NSE), data was not available with the exchanges. In common parlance, it could be known as vanished companies. However, officially, only the finance ministry has the power label them these as "vanished companies".

CNI says the data of Rs 61,000 crore was arrived at based on the available information and there is every possibility to conclude that this figure must been higher than Rs 1,00,000 crore.

"If this sum is correct than this could be amongst the biggest scams to have happened in the country and one therefore wonders as to the accountability factors for the public losses," CNI questions.

CNI says the considerable lapse of time since the companies have been suspended also suggests that this could be one of the backdoor de-listing routes, where promoters sell shares in the open market followed by violation of one of the listing agreements which prompts the exchanges to suspend the companies from trading, not without sufficient notices from their end.

"Yet at the end of the day, the loser is none other than retail investor. There is no recourse to any of the retail investors to dip in the investors' protection fund in such cases where stocks have been suspended at the behest of the promoters," the report highlights.  

The common feature of most of the companies was that the promoters, before violating listing agreements, preferred to sell entire stakes. The promoters' stake was either zero percent or close to 1 percent at the time of suspension. "This leads to an obvious conclusion that promoters dumped their shares in the market before getting suspended," the report says.

"Rs 12,145 crore for 250 companies shareholders’ net worth unlocking suggests that the balance 1,200 companies can still help unlock investors wealth of Rs 58,296 crore in current scenario. Maybe rising market may give more amounts. The figure of Rs 58,296 crore is arrived at using pro rata method," CNI says.

http://www.moneycontrol.com/news/market-edge/over-rs-61000cr-investor-money-blockedsuspended-cos_812027.html#toptag

Second Year of Europe Contraction...MARKETS..???

IMF Cuts Global Forecasts on Second Year of Europe Contraction

By Sandrine Rastello - Jan 23, 2013 7:00 AM PT

The International Monetary Fund cut its global growth forecasts and now projects a second year of contraction in the euro region as progress in battling Europe’s debt crisis fails to produce an economic recovery. The world economy will expand 3.5 percent this year, less than the 3.6 percent forecast in October, the Washington-based IMF said today in an update of its World Economic Outlook report. It expects the 17-country euro area to shrink 0.2 percent in 2013, instead of growing 0.2 percent as forecast in October, as Spain leads the contraction and Germany slows. “Is Europe on the mend? I think the answer is yes and no,” IMF Chief Economist Olivier Blanchard said in a video released with the report. “Something has to happen to start growth.”

While measures to stem the debt turmoil last year helped boost financial markets around the world and decrease sovereign bond yields from Spain to Greece, European officials now still face a recession and unemployment at a record 11.8 percent. The IMF warned that the region still poses a “large” risk to the rest of the world if efforts under way to strengthen its economies and work on a banking union slip. The forecast for a second year of economic contraction reflects “delays in the transmission of lower sovereign spreads and improved bank liquidity to private sector borrowing conditions,” as uncertainty remains over ending the turmoil that has engulfed nations from Ireland to Cyprus, according to the report.

2014 Outlook

The fund expects the region’s outlook to improve, forecasting a return to 1 percent growth in 2014. It sees the world economy expanding 4.1 percent next year, 0.1 percentage point less than in October. In the U.S., “ underlying economic conditions remain on track,” the IMF said as it cut its forecast for the world’s largest economy to 2 percent from 2.1 percent in 2013 and raised it 0.1 percentage point to 3 percent next year. The priority is for Congress to avoid too much deficit reduction too soon, reach an agreement between Republicans and Democrats to raise the debt ceiling and craft a plan to reduce debt over the medium term, according to the report. While the forecast for Japan was left unchanged at 1.2 percent this year amid fiscal and monetary plans to stimulate its economy, the fund cut the 2014 prediction by 0.4 percentage point to 0.7 percent.

Japan’s Debt

Fiscal expansion is “going to help growth in the short run, no question,” Blanchard said. At the same time “when you start with such a level of debt and without a medium term credible fiscal consolidation plan, increasing the fiscal deficit in the short run is a very risky thing to do.” Commodities exporters will feel the pinch of falling prices, with oil now seen slipping 5.1 percent instead of 1 percent, according to the report. While supportive policies have help buoy growth in some emerging market countries in recent months, there’s less space for such action now, it said.

Growth forecasts for Brazil were cut to 3.5 percent this year from 4 percent and to 4 percent from 4.2 percent in 2014. India was lowered 0.1 percentage point to 5.9 percent this year and was left unchanged at 6.4 percent in 2014. The IMF didn’t change its forecast for China, seen growing 8.2 percent this year and 8.5 percent in 2014. “It’s not the rates that we saw before the crisis, but these rates are long gone,” Blanchard said of emerging countries. “Things in general are fine.” In Europe, German growth was cut by 0.3 percentage point to 0.6 percent in 2013 and is seen accelerating to 1.4 percent next year, from 1.3 percent. Spain will contract 1.5 percent this year, compared with 1.3 percent in October and is seen growing 0.8 percent in 2014, 0.2 percentage point less than before. Italy will shrink 1 percent in 2013 rather than 0.7 percent seen in October, and expand 0.5 percent in 2014, unchanged from three months ago, according to the IMF report released today. While most developed economies need steady fiscal consolidation, and continued reform of their financial sector, recommendations for developing counterparts vary depending on their circumstances, the IMF said.

To contact the reporter on this story: Sandrine Rastello in Washington atsrastello@bloomberg.net To contact the editor responsible for this story: Chris Wellisz at cwellisz@bloomberg.net

http://www.bloomberg.com/news/2013-01-23/imf-cuts-global-forecasts-on-second-year-of-europe-contraction.html

JBT scam: 78-year-old Chautala,a five-time former CM,gets 10 year jail

JBT scam: Om Prakash Chautala, Ajay Chautala get 10 year each in jail
Last Updated: Tuesday, January 22, 2013, 14:50
Zeenews Bureau 
New Delhi: A Delhi court on Tuesday sentenced former Haryana chief minister Om Prakash Chautala to ten years in prison after he, his son Ajay Chautala and 53 others were found guilty of illegally recruiting 3,206 junior basic trained (JBT) teachers in the state in the year 2000. The court of Judge Vinod Kumar also sentenced Ajay Chautala to 10 years in prison. The 78-year-old Chautala senior, a five-time former chief minister, and his son 51-year-old Ajay Chautala are both sitting MLAs and could stand disqualified from contesting the Assembly Elections next year if their conviction is not stayed by a higher court. 
Under the Representation of the People Act, a person convicted of any offence and sentenced to more than two years imprisonment shall be disqualified from the date of conviction and for a further period of six years after his release. Apart from Chautalas, the other three main accused - IAS officer Sanjiv Kumar, Chautala's former Officer on Special Duty Vidya Dhar and political adviser to the then Haryana CM Sher Singh Badshami - were also awarded 10 years in jail in the case. 
Apart from the five main accused, four others, including a woman, have been awarded 10 years jail term, one has been given five years and the rest 45 given four years sentence. Unfazed by the violence outside, the judge read out the order of sentencing as Chautala's supporters thronged the court complex, threw stones and crude bombs, and clashed with police who resorted to lathicharge and use of tear gas in a bid to restore order. The senior Chautala was not present in the court because of his hospitalisation after being taken into custody last week; his son and all the other convicts were present in the court. The court had – on January 16 - pronounced them guilty of cheating, forgery, using fake documents as genuine, conspiracy under the IPC and for abusing their official position under the Prevention of Corruption Act. 78-year-old Om Prakash Chautala, the chief of Indian National Lok Dal, was held as the "main conspirator" by the court. Reports said after the sentence was pronounced, protestors even threw stones and crude bombs into the court complex. A large posse of para-military forces were also called in to try and control the restive crowd. 

Other than the 55 accused, their counsel, prosecutors and the court staff, the judge did not allow anyone else to enter the court room during the hearing. All the 55 convicts have been convicted and sentenced under sections 120B(criminal conspiracy) , 418(cheating), 467(forgery), 471 (using forged documents as genuine) of the IPC and sections 13 (1) (d) and 13 (2) of the Prevention of Corruption Act. The CBI had filed its chargesheet in a Delhi court after its probe established that a conspiracy on making second lists was hatched at Haryana Bhawan here by calling the chairpersons and members of the district-level selection committees f 18 districts. They were also called at a guest house in Chandigarh, where the modalities were worked out, it had said. 
The court had said that first IAS officer RP Chander (CBI witness), who was the then Director of Primary Education, had given a proposal for declaring the results of successful candidates in April 2000, but he was transferred on the next day itself. Subsequently, IAS officer Rajni Shekri Sibal (CBI witness), was brought in at Chander's place and she was asked by accused Badshami and Vidya Dhar to change the award lists in the presence of Ajay Chautala, it had said. 

(With PTI inputs)
http://zeenews.india.com/news/nation/jbt-scam-om-prakash-chautala-ajay-chautala-get-10-year-each-in-jail_824370.html

Tue, Jan 22, 2013 at 15:32

Why Einstein lost money in stocks?

Few know that Albert Einstein invested much of his 1921 Nobel Prize money in stock markets. However, he lost a bulk of it in the stock market crash in 1929. 

F

ew know that Albert Einstein invested much of his 1921 Nobel Prize money in stock markets. However, he lost a bulk of it in the stock market crash in 1929. Pity that he could not lay his hands on Benjamin Graham's Security Analysis that was first published only in 1934. 

But he is not to blame. For in those days investing hardly called for any qualitative checks. What was lost on Einstein is not a secret formula to help find cheap stocks. But the behavioral trait to buy only when others are fearful. 

Now 1929 was not the only time when stock markets gave a torrid time to investors. But even as late as 2007, there were few lessons learnt.

The analysts at Wall Street used complex formulae to see how the past performance can be used to simulate the future. They ran screens, tested scenarios and compared with standard deviation of peers. Being objective about their investing decisions came naturally to them. They could estimate the minutest change in company's earning power with a single basis point change in pricing. But the immodest pricing of subprime home loans did not draw their attention. They 'objectively' invested and re-invested in papers with zero valued collateral. This was purely out of their greed for higher ROI (return on investment). Eventually when the loans turned bad and banks were on the verge of insolvency, the objectivity of such investing came to be questioned.

Since investing is widely acknowledged to be a science, objective assumptions should throw up accurate estimates. However, as a scientist will tell you, the subjective element is necessary even in separating different elements of a molecule. 

Many leading scientists today compare cutting edge science with art. Investing behavior too, however logical, cannot be typecast. In other words stock picking methods cannot be standardized or computerized. There has to be an element of subjectivity. The human element, if you will. Benjamin Graham himself although a stickler for numbers, left enough scope for behavioral decision making. The 'margin of safety' concept in his legendary book is a product of the same. 

Leading value investor Seth Klarman calls value investing as "the marriage of a contrarian streak and a calculator." Now not all value investing is contrarian. In a recent blog, valuation expert Aswath Damodaran classified value investors into three categories: 

'Screeners' who look for stocks that trade at relatively lower valuation multiples compared to closets peers. 

'Contrarians' who look for value in the most beaten down stocks hoping that valuations will reverse to the mean. 

'Activists' who acquire large stakes in undervalued or poorly managed companies with the belief that these will eventually unlock shareholder value. 

If you notice each of these approaches have a tinge of behavioral element involved, besides the math. Hence even if you are as good as Einstein in the latter, ignoring the behavioral aspect in investing will do no good. You could be famous but not rich. 

Equitymaster.com is India's leading independent equity research initiative

http://www.moneycontrol.com/news/investing/why-einstein-lost-moneystocks_811537.html#toptag

Obama Begins Second-Term...Congrats!!!

Obama Begins Second-Term Celebration Before Fiscal Fight

By Julianna Goldman - Jan 21, 2013 7:44 AM PT

President Barack Obama took the oath of office yesterday to formally start a second term that will carry over many of the same battles from his first. Obama was officially sworn in by U.S. Chief Justice John Roberts at 11:55 a.m. during a brief ceremony in the White House. He’ll take the oath again today outside the U.S. Capitol and deliver his inaugural address to thousands of people spread across the National Mall in Washington.“Congratulations, Mr. President,” Roberts said yesterday in the Blue Room, as Obama repeated the final words, “So help me God.” “Thank you, Mr. Chief Justice. Thank you so much,” Obama replied. As his extended family applauded, Obama embraced his wife, Michelle Obama, and their daughters, with 14-year-old Malia telling her father, “You did it, Daddy.” “I did it,” he said in response.Obama, 51, the nation’s first black president, has presided over an economy that is still recovering from the worst recession in a generation. While the world’s largest economy grew at a 3.1 percent rate in the third quarter, this year will bring growth of just 2 percent, according to the median estimate of economists surveyed by Bloomberg. Over the next two months his administration will engage in a fiscal debate with Republican lawmakers who hold the majority in the U.S. House over raising the government’s $16.4 trillion borrowing limit, steps to shrink the deficit and funding federal operations.

Constitutional Requirement 

Jan. 20 is the constitutionally required date for the U.S. president to assume office. Because it fell on a Sunday, Obama’s inaugural festivities are taking place today. Roberts will again administer the oath, using Martin Luther King Jr.’s traveling bible and President Abraham Lincoln’s first inaugural bible, the same one Obama used for his swearing in four years ago. Today is also the federal holiday marking the birth of the slain civil rights leader.Before heading to the Capitol, the president and his family attended services at St. John’s Episcopal Church, the 197-year- old parish a block from the White House known as “the church of the presidents.” The Republican and Democratic leaders of the House and Senate joined Obama afterward for coffee at the White House.

Parade Crowds

Hours before the ceremonies began, crowds began filling the parade route along Pennsylvania Avenue between the executive mansion and the Capitol. Red, white and blue bunting decorated the bleachers while band music played and Boy Scout troops help direct crowds. Obama’s inaugural address won’t be a policy speech and he won’t be outlining new proposals, according to White House aides, who asked for anonymity because they weren’t authorized to discuss the address. While he plans to avoid making a political speech, Obama will seek public support for his goals. Policy specifics will be left for the president’s State of the Unionaddress to a joint session of Congress on Feb. 12. As Obama embarks on his second term, he has shed the aura of a hopeful consensus builder determined to break partisan gridlock. Instead, the Democratic president has adopted a more confrontational stance, refusing to negotiate with Republicans over the debt ceiling and asserting executive authority on gun control.

Battle Hardened

“He’s much more battle hardened in terms of understanding that the opposition may not just be subject to sitting down and reasoning together,” said John Podesta, who was former President Bill Clinton’s chief of staff. “He’s shaping the battlefield now, with a much keener understanding of what the opposition looks like.” Obama’s first term was largely consumed by repairing economic wreckage from the 2008 financial crisis and getting his health-care law passed. His next four years -- and ultimately his legacy -- may be judged by how much he can accomplish in an era of domestic political dysfunction and persistent international challenges. In recent weeks, Obama has been reading up on second terms, reviewing past inaugural addresses, and dining with presidential historians at the White House. He solicited advice while golfing with Clinton, a fellow Democrat who served two terms.

Rhetorical Power

His advisers say the president has learned the value of bypassing Congress, pursuing goals through executive actions instead of legislation, and marshaling public opinion. “The powers of the presidency are largely rhetorical,” said David Axelrod, Obama’s campaign strategist. “Power is limited in many ways by politics. What the president does have is the bully pulpit.” The celebration of Obama’s inauguration is toned down compared with the festivities four years ago. Officials say they expect fewer than half of the 1.8 million people who attended in 2009. There is one official inaugural ball tonight, as well as the commander-in-chief gala. The president kicked off four days of events tied to the inaugural Jan. 19 by volunteering with his wife and daughters on a Washington elementary school. As he did 2009, Obama called for a National Day of Service, saying volunteerism represents the democratic ideals upon which the country was founded.

Getting Started

Before they were officially sworn in yesterday, Obama and Vice President Joe Biden yesterday laid a wreath at the Tomb of the Unknowns at Arlington National Cemetery. Obama and his family also attended services at historic Metropolitan African Methodist Church in Washington. In the evening, they attended a reception for supporters at the National Building Museum in Washington. “He’s just getting started,” said Biden, who also attended the gala with his wife, Jill Biden. Biden’s swearing-in for a second term took place at the vice presidential residence with Supreme Court Justice Sonya Sotomayor, the first Hispanic on the court and the first to administer the oath. Giving her a kiss afterward, Biden told Sotomayor it was a “wonderful honor.” Roberts will administer Obama the oath of office for the fourth time today. It’s a record for a two-term president. In 2009, the chief justice repeated the oath of office for Obama on Jan. 21 after misstating a line during the official ceremony the day before. The Constitution requires presidents to take the following oath: “I do solemnly swear (or affirm) that I will faithfully execute the office of president of the United States, and will to the best of my ability preserve, protect and defend the Constitution of the United States.” Roberts said “execute the office of president of the United States faithfully” and Obama followed suit. Yesterday, as Roberts slowly and deliberately read the 35- word oath in the Blue Room ceremony, his left hand was trembling lightly and his sheet of paper shaking ever so slightly. The swearing-in lasted only 30 seconds.

To contact the reporter on this story: Julianna Goldman in Washington atjgoldman6@bloomberg.net

http://www.bloomberg.com/news/2013-01-21/obama-begins-second-term-with-celebration-before-fiscal-fight.html