How to make money in India: What these two individuals know is invaluable
We had two real neighbours when I was growing up as a child in Defence Colony, New Delhi, in the '60s. On one side was a famous Barrister, as modest and hard-working as any other post-Partition re-start person, whose family members are currently co-Plaintiffs with me on matters pertaining to the dangers of excessive radiation from uncontrolled and especially illegal mobile phone towers. On the other side was the "small house" of an equally famous stock-broker and investor who had an office in the then swankiest and most "regal" building in town, and was also immensely wealthy by the sheer width of the collection of foreign cars in their drive-way.
Some of my memories are of being dropped to school in those cars - he had a preference for huge American cars, which felt like what I imagined ships were like - which probably influenced my choice of career a few years later. Some of those cars were also used for North India scenes in Bollywood movie shootings, which in turn meant that the drivers were much sought after for the lurid tales they dispensed with freely. In an era before television, internet and social media they were the real influencers.
It was also well-known that the stock-broker neighbour was a money-lender of no small measure, and was somehow also involved in promoting upcoming stars and starlets, towards which he also was involved in the publishing of some really lurid and revealing magazines sold wrapped in yellow cellophane - which as a teenager I would receive off and on from the above said drivers.
The business of stock-broking and money-lending was intricately linked in India in the '60s and then the '70s, as was the business of money-recovery, and the film industry was a huge customer. It was, therefore, natural that a sort of Delhi-Bombay-Calcutta Punjabi axis emerged after Partition which I learnt more about when I reached Bombay in 1973 and Calcutta thereafter. A quick rap on the knuckles from my late father, and I was soon dispossessed of whatever 17-year old dreams I had of heading to Bollywood - besides, I simply did not have the height or looks. In addition, with our Training Ship moored in the waters off Mazagaon, friends from the Byculla-Mahim-Bandra belt, and local guardians in Chembur, it was a rapid learning curve for me on the Karim Lala - Ratan Khatri controlled side of Peshawar-Amritsar-Bollywood as well as co-linked business of stocks and shares.
But the business of making money on the stock market always fascinated me. Repeated efforts, only brought wisdom at the cost of losses, caused by high brokerage costs, delayed pay-outs, brokers arbitraging the daily or even weekly and fortnightly highs and lows to their advantage, all sorts of signature mis-matches and "delivery issues", fake certificates as well as stamps, and more. I lost money even on the shares of the shipping company I worked for. Barring stock-brokers, I did not know anybody who had made money in the stock-market, till I worked alongside a Gujarati friend in the ship-broking business in the '80s and '90s, who wised me up to what i was lacking - I did not speak Gujarati. One more rap on the knuckles.
Fast forward to a few years ago when a small Bangalore-based company broke the glass ceiling of language, location and grease, by bringing in a really slick online discount zero-brokerage option, with massive transparency. What I really liked and then realised was one of the big reasons for their success, was that proceeds of sales from the equity business were immediately available for further trading, and to my knowledge, most people simply could not bear to see money lying unused, and would therefore pump the proceeds and more right back into buying something else in the same equity business. Opiate of the masses, is what I realised this had become, replacing to some extent the get-quick-rich ponzi schemes that were also sweeping the country across the last 10-15 years. No more T-1, T-2, T-3 or worse, and seeing wealth on the screen even in your dreams, became the new valhalla.
But human ingenuity is unbeatable, and over the decades we read about Harshad Mehta, Ketan Parikh, broker bankruptcies, fake stamps, SHCIL, NSE Algo, exchanges that came and went like mushrooms, IPOs for everyone, and more. Navigating through this minefield required not just caution, but also the need to acquire more knowledge, and towards that, I found what Sucheta Dalal and Debashis Basu knew and know, invaluable. It helped that they brought out a magazine which was amongst the earliest to also arrive on the internet and the archives of which are pure gold.
The first part of their latest book, ABSOLUTE POWER, somehow shares a title with a Clint Eastwood movie. Part Two, which I shall review next, is more about what happens after the bad guys are hauled up.
(Veeresh Malik was a seafarer. And a lot more besides. A decade in facial biometrics, which took him into the world of finance, gaming, preventive defence and money laundering before the subliminal mind management technology blew his brains out. His romance with the media endures since 1994, duly responded by Outlook, among others.
A survivor of two brain-strokes, triggered by a ship explosion in the 70s, Veeresh moved beyond fear decades ago.)
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