Have Indian banks been infected by the predatory lending virus?

Looks like the staid State Bank of India itself is guilty of baiting consumers with low "teaser" interest rates that increase dramatically to the prevailing rate after a few years of paying the EMI.

When the customer can no longer afford to easily service the loan (pay the EMI), interest and penalties may ratchet the debt noose till it becomes simply too tight - an apt analogy since Indians usually handle their plight with the end of a rope, and not at a bankruptcy court.

The Reserve Bank of India (RBI), the country's banking regulator, made it very clear that it disliked the product. There is more than one thing that the RBI saw wrong with the idea... It said that since existing customers don't get the low interest rates, the "teaser" loans is also discriminatory.

In the Business Standard today... Outgoing State Bank of India (SBI) Chairman OP Bhatt defended the "teaser" home loan rates.

Mr Bhatt termed the RBI's opinion of SBI's "teaser" rate being comparable to US sub-prime loans, as "beyond logic". He said his offering is sold to those who are "absolutely credit-worthy." Mr Bhatt added, "Obviously, they (RBI) have not understood our product."

Yes, perhaps they are credit-worthy when they start out - but what about after the rates are 'reset'? Is the SBI considering future credit-worthiness as well?

Interestingly, after such strong conviction, Mr Bhatt concedes... "but if they (RBI) still insist that this cannot be continued and is against its norms, then we will comply."

He is actually willing to go alongwith an "illogical" opinion! Can he not prove the logic of his product? Is it really that difficult to make the RBI "understand" a banking product?

It would be interesting to see where Mr. OP Bhatt goes after his SBI chairmanship.

In other news today on Business Standard... The RBI came down heavily on some banks which are violating agreements with borrowers on increasing interest rates.

According to the report, some banks raise interest rates every time the benchmark prime lending rate (BPLR) is changed. It is called 'reset clause'.

It basically means that some customers may opt for a 'fixed rate' over a 'floating rate' of interest even though the 'fixed rate' is slightly higher. Only, it not really 'fixed' - banks have the right to 'reset' the 'fixed rate' during the term of a loan... But only after a fixed number of years which is mentioned in the loan contract.

It would seem that some banks simply don't give a damn about loan contract clauses that aren't to their benefit!

No bank is named - but the RBI is said to be looking into all term loan accounts of one Kolkata-based bank against which there was complaint... The reason is that the regulator feels there may be more borrowers who are "suffering in silence"... Unfortunate hard working families that do not even know they are being ripped off by a greedy bank!

The real danger is not that this sort of rapacious bankers are in India, but that they have nothing to fear!

There really isn't a credible deterrent... On the issue of the Kolkata-based bank, all the RBI said was... “In cases where a discrepancy is observed, the same should be rectified immediately and the excess amount refunded to the borrower.”

This is kind of weak wrist-slapping that emboldened Wall Street banks like Goldman Sachs to turn into "a great vampire squid wrapped around the face of humanity" according to an article in Rolling Stone magazine.

(Don't snigger, the cold tentacles of the great vampire squid are already in India.)

Before I leave, I have a question for ALL bankers: Just how much profit is enough? Seriously, will there ever be a time that you will pull your usurous fangs from the throat of humanity?

Just remember, Mr Banker, that one day when his hungry children are in bed, Mr Humanity will step out of his home holding a torch in one hand and a pitchfork in the other. And in the streets, he may not be alone.

You remember that - and that alone.

Wael Ghonim on Revolution 2.0 in Egypt

I would like to expand on what Wael said about the Internet (and technology 2.0) being key... I agree it was. But let's not beguile ourselves into thinking that social media sparked it - or can in any way, conclude it. It is not people from the virtual world who did it, it was people from the real world using the virtual world. It is all about people, not technology, which is a mere tool.

Social media tools are just like earlier popular media used by people to voice dispproval or dissent - like music in the 60s and 70s. As each is taken over by the "system", people simply find new means and tools. (More on that in another post.)

Well, Godspeed to him - and the good people of Egypt.

By the way, I really liked his final statement.

Why Dr Manmohan Singh's cure is worse than the disease

Unless you've been holidaying on Neptune for the past few years, you are likely to be aware of the series of corruption scandals that have rocked the current Government of India.

Let's recap...

These are just the biggest ones to come to light:
- The $44 billion S-band Spectrum Licences Scam
- The $39 billion 2G Spectrum Telecom Licence Scam
- The $21.7 million New Delhi Commonwealth Games Contracts Scam
- The (suspiciously under-reported) multi-million dollar Loan Bribery Scam
- The multi-million dollar Mumbai Housing Scam
- The Niira Radia Tapes (The loss this had on the Indian national exchequer by way of corporate lobbying, influence-peddling, media manipulation is incalcuable.)

Together, the loss to the nation runs into the trillions - yes, trillions of Indian Rupees. The S-band deal itself was an estimated loss of Rs 2 trillion. (I had earlier posted a video of what a trillion in paper money would look like.)

The right question to ask here is: If the people of India were saddled with the loss, who gained?

You see, as diverse and unconnected as these corrupt dealings may seem, there are two common set of players involved in ALL of them:
1.) Indian parliamentarians, and
2.) Multinational businessmen

Another minor fact that seems to conveniently slip everyone's notice is that ALL the scams are directly (Sale of 2G & S-band Spectra) or indirectly related to the GOI's headlong rush to 'liberalise' the country's economy.

One person in particular seems unable to see any connection. This is the Prime Minister of India and eminent economist, Dr Manmohan Singh. In fact, he is convinced that just the opposite is true - that 'Economic Reform' a.k.a. further 'Economic Liberalisation' - will prevent such scams. How? Well, it's magic - we'll have to see it to believe it!

According to an AFP report, on Friday, 25 March, the PM unveiled his magic formula to fight 'corruption' - and it is to "confirm our commitment to new wave of reforms."

He says that the government was committed to carrying forward reforms in the financial sector to sustain India's high growth and fight inflation. Wow, really? Ok, here are my questions to you, Sir. Could you please explain how would the larger currency flows in an (exponentially) growing economy mitigate inflation? And do you sincerely expect the Indian public to believe that bringing Wall Street bankers into the country will help fight corruption, stabilise the economy AND bring down the market price of onion?

I suspect Dr Singh is either seriously delusional - or he is deliberately pushing a nauseating Orwellian 'doublethink' on the people of the country. [Doublethink (1984 by George Orwell):To tell deliberate lies while genuinely believing in them, to forget any fact that has become inconvenient.]

Let's go over these inconvenient facts...

Dr Manmohan Singh is credited with opening up India’s economy in 1991 while he was Finance Minister. But the normally overzealous Indian media (except perhaps, Tehelka) hasn't covered ALL the upshots of this policy... For example, a report by Global Financial Integrity states: "In the post-reform period of 1991-2008, deregulation and trade liberalization accelerated the outflow of illicit money from the Indian economy. Opportunities for trade mispricing grew and expansion of the global shadow financial system—particularly island tax havens—accommodated the increased outflow of India's illicit capital flight."

Yes. Corruption and outflow of India's wealth actually increased - might I add by a factor of several fold - since India started down the path laid by Dr Manmohan Singh!

The report also adds that "High Net-Worth Individuals (HNWIs) and private companies were found to be the primary drivers of illicit flows out of India's private sector."

D-uh. Just who did you think benefits from the liberalising of (meaning, loosening strictures on) economic activity. Oh! Please spare me the la-de-la of "the trickle down effect".

Meanwhile, Dr Singh also termed the battle against corruption as a "relentless one" requiring "eternal vigilance". Is he advocating a hunt for a chimera - perhaps, a perpetual "War on Corruption" modelled on the "War on Terror"?

Dr Singh apparently welcomes the "focus on corruption because it will, as it already has to an extent, generate public pressure in favour of more reform". So now the people of India are pressurising him to underprice and sell-off national assets? C'mon Dr, the average Indian, the "Aam Aadmi", may not possess multiple Honorary Doctorates, but that does not mean he is soft upstairs!

(pause)

Now you, dear reader, probably wish to know, if Economic Liberalisation is not the way for India, then what is? Well, how the hell should I know? Ask Manmohan. He's the one with the doctorates and the advisors (we're not counting lobbyists just yet). Anyway, isn't that's the job the Indian electorate gave him?

Well, almost...

You see, the Indian public didn't really elect the honest and upright Dr Singh. He's a parliamentarian all right - but only an unelected Rajya Sabha (Upper House) member from Assam.

So if the Indian voter isn't technically his boss, who is?

Another profound haiku moment

Live
bitter-sweet; love hate
Die

(Not the classic 5-7-5 syllable haiku - but a similar tone and proportion?)

One haiku moment...

Summer is here;
change is in the air.
Life freezes.

Don't be paranoid

I do try - but it's not getting any easier these days.

Now Marc Faber has another remarkably gloomy message. And again, it's sounding uncannily sensible. (Another thing uncanny is the kind of airtime he's been getting on CNBC lately.)

Take 2 Prozacs before you watch this... It'll kick in at just about the right time.

Government, Money and the Theory of Relativity

Ok. So it's not Einstein's theory. This is mine. And it goes like this: Human beings can't comprehend facts without a perspective.

Or in other words, to fully understand something, we need to see it relative to things we already understand. That is why we have metaphors, analogies and - yes, in a way, parables and allegories too.

For instance, government is more substantial than the governed, even if the former is in the 100s of individuals and the latter in their 1,000,000s.

Maybe this video will help you see the difference.



While we are on the subject of relativity, let's look at the numeral 1,000,000,000,000 or trillion that is tossed about with impunity by people in expensive suits these days...



Now that they are in perspective, does either of it look very sustainable to you?

Plague, pestilence ...and now the scourge

The Rothschilds, the Gates, the Rajas, the Kalmadis and now the grand 'Oracle of Omaha' himself, has set his kindly eyes on an already ravaged Mother India. Seriously, maybe it's time for the Parliamentarians to step aside and let the real professionals show how economic pillaging ought to be done.

Meanwhile, the 'ill-omen from Omaha' is giving away 99% of his estimated $50 billion personal wealth through "The Giving Pledge" campaign, with his one hand - and in my wholly-biased, ill-informed estimation, will manage to more than make up by stripping compounded interest, profits and assets from the country via the retail, insurance and financial services sectors, with his other hand.

And he'll probably give 99% of that to charity as well!

Anyway, the Berkshire Hathaway trojan is dangling $40 billion in juicy bait. Will the salivating oligarchs and parliamentary parasites of India bite? If - or more likely, when they do, how bad is it going to get? Maybe we should consult the Oracle.

By the way, I like the fact that the bleeding-heart thinks "the American economy is getting better month by month." I am sure it is positively blooming. After all, it's the f-ing Oracle speaking!

Ok. Maybe I'm overreacting. I'm sure the insatiable ones are in India merely to "create wealth and prosperity" for 900 million half-naked fakirs.

Yeah, that's it... IT'S ALL FOR OUR OWN GOOD.

Why the truth doesn't hurt anymore

Here is Peter Oborne stating the obvious. He is a Daily Mail and Daily Telegraph columnist, and he could be talking about any parliament here.

How the system functions is as obvious as daylight - if one is not glued to the idiotbox... A group of elites control the major banks. The major banks control big business. Big business controls government. (Surely, only a fool would equate today's "politician" to "public servant".)

They all seem to have one aim: The blind pursuit of wealth (and of course, the power to hold onto it).

In all this, the public plays a very minor role - as workforce and consumers. And they know it.

A sudden, unexpected revelation might be shocking or hurtful - but this? This, we expect.

Libya: Third face of the same coin?

The two previous "People's Uprisings", in Tunisia and Egypt, were seemingly handled entirely by citizens armed only with their desperation and idealism.

They rose up against the visible symbols of an oppressive system. And they removed the ones that seemed to be controlling their, and their nation's, destiny.

Unfortunately, neither the system nor their destiny seems to have changed much!

Now that the so-called "World Leaders" have decided to intervene in Libya, let us wait and see if the "International Community" manages to do better than the people of Tunisia and Egypt.

However, if a military-backed group comes out on top AGAIN - well, then it should give all right thinking people food for thought.

Perhaps then, someone will get to play a game of "Follow the Money":
- Who will arm the armed forces?
- Who will finance the re-construction programmes that will inevitably follow?
- Who will win those lucrative infrastructure contracts?

Will it be the usual suspects?

Meanwhile, let us all pray for the innocents in Libya caught in the crossfire. Let us not forget that they are not watching the flames and carnage on cable TV. It's outside their bedroom window.

How is solving the world's problems like dentistry?

Well, when nothing else seems to work, take the root out. And the pain will go away.

Even Albert Einstein once said, “We can't solve problems by using the same kind of thinking we used when we created them.”

The following video is how Dennis Kucinich, a US Congressman from Ohio State puts it.

Ok, this man's got a pair... In the late 70s, at age 31, Dennis - the youngest mayor of a major US city, Cleveland - refused to privatise the city's electric utility company, and the local mafia put out a 'hit' on him! He refused even when a bank forced the city to go broke!

(Later, actually twenty years later, the city council honoured him for his courage in standing up to the financiers - and having saved the city close to $200 million between 1985 and 1995!)

In 2007 and 2008, he tried to impeach Cheney and Dubya, respectively.

Dennis Kucinich was a candidate for the Democratic nomination for President of the United States in the 2004 and 2008 elections. Imagine that.

Here, he is speaking to a crowd in Tahrir- sorry, Wisconsin...

In the beginning he might sound like any politician leading a crowd on with an utopian welfare-state faiytale. And you'll be thinking just how is he planning to get any of it done? He tells you... but you got to wait till the 14th minute. Can you?

(And by the way, you can substitute the name of the nation and the city with any in the world. His idea still holds.)

The destination is unclear, but the journey has begun

Three more ministers have left Tunisia's interim government, following the resignations of the prime minister and two others, after weeks of protests about the caretaker authority. (Emphasis mine.)

In Egypt there is the surprise resignation of the Prime Minister.

But the protests continue.

All over the globe, it is the same thing... Winning the stated aim isn't enough. There seems to be something else that the Collective "feels" it must do.

"I am an idealist. I don't know where I'm going, but I'm on my way," said Carl Sandburg (1878 – 1967), the American writer and poet.

Is there a Tahrir Square in Wisconsin?

The Police Union in the State of Wisconsin announces solidarity with students, workers and Wisconsin residents occupying the State Capitol in Madison!

The date is February 24, 2011.



There's more here. And here.

Et troisième...

We had a lot of fun creating this narrative for a forthcoming 5-litre, 416bhp, V8 sport sedan - the ISF from Lexus.

First, let's see what happens when Lexus takes off the Savile Row overcoat and the monogrammed gold cufflinks; and loosens the silk necktie. Shocking, indeed!


All because (now, I'm assuming this) some muscle-car jock pissed-off a bunch of timid, bespectacled automobile engineers... who have access to a exclusive Formula One standard race track and some serious number-crunching hardware.


Now, after teaching muscle-car boy the difference between "drag" and its "coefficient", they need to sell some of these "Eat my dust, s'il vous plaît" machines. No problem. We have an App... sorry, Ad, for that too.


One more.

We had pitched for a Private Banking brand... It may sound a bit vain, but perhaps, we should've landed the account on the strength of this concept alone. Ok, that is vain.

Portfolio, La Deuxième

In case, I've given the feel lately that I've stopped loving Advertising... perish the thought. It is just that I've been unable to upload stuff to my 'Portfolio page'. (Blogger and I have a bitter sweet marriage of convenience.)

So it's got to come here, for now.

Anyway... These are some of the prettier-looking print ad thingys I've done lately.

The following series of ads had been done for the newest Media & Media Services Directory in the country. It's a real mixed-bag audience. So we dropped the temptation of omg!-that's-sooo-clever ads, and went back to basics and a drawing board. Literally. The result was sheer simplicity - the unvarnished sort of claims someone might actually be persuaded to believe.

UMS has got Advertising...


Direct Contact & Activation...


Public Relations & Media Management...


Corporate Events...


And we've got the most prolific Digital & Internet shop in town...



There is this interesting little gem that came along when no one expected...



When time permits, I do try my hand at the odd poster and logo design.

The following is something I simply loved doing... The petite à-la-francaise-style 'coffee cup & cookie' doodle - and of course, the cheeky Copy.

And while sometimes, the stuff I "cobble together" gives my Art guys a hell of a time cleaning up - (sorry guys) - this was not one of those times.




And here's a poster I did for the Creative Department. (Got to remember to take a printout soon!)

The Art and Layout is mine. The profound words, Bill Bernbach's.



Here's a unreleased concept for a feline cause...

Food Currency, anyone?

In theory, increasing the supply of a currency eventually lowers its value - and fuels inflation. And when rising cost-of-living is the issue you are trying to tackle, such a move could be viewed as counter productive in the longer term.

On the other hand, when people genuinely need assistance - especially for food - what other choice are there?

I'm no economist, but I think there may be a way to introduce money to subsidise food purchase WITHOUT pushing up inflation. It seems like a wild idea - but there are precedents!

I am talking about introducing a 'secondary' currency, called "FOOD CURRENCY"!

In the United States, the Electronic Benefit Tranfer (EBT) is a debit card that replaced the earlier "Food Stamps Program".

But I'm not a fan of rationing food - and especially not for pushing the consumption of pre-packaged food... So maybe this FOOD CURRENCY could be a real physical currency circulated in a closed loop 'fresh food cycle' going from the governement to buyers to fresh food retailers to local farmers who in turn could redeemed it from the government, partially in regular (primary) currency, and partially for tax-breaks and/or organic agro-inputs. Thus subsidsing producers and consumers of fresh locally-grown food.

Positive impact on healthcare, employment generation and lower import bills are just the beginning...

Since there is no usurious bank debt or other interest component weighing down the currency; and the only thing it can be considered to be pegged against is 'fresh food', a tangible increasingly valuable commodity, there is a distinct possibility that a FOOD CURRENCY will not only be stable, but actually appreciate in value even though it is created out of thin air!

Hey, I'm not an economist, but this just feel like commonsense. And right now, I'd rather go with commonsense than high-falutin' economics.

After all, just look where all the smart financiers and economists have got us today...