Monthly Archives: October 2008

PetroDollar Scam

This is a mail forward. I really don’t know how far it is true. But I think it makes sense. So just putting up right here.

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Back in 1971, the USA printed and spent far more paper money than it could cover by gold.

Few years later, French demanded redemption of its paper-dollar holdings in gold. But the USA rejected as it actually didn’t had enough gold for the dollars it had already printed and spent all over the world, thus committing an act of bankruptcy. Continue reading

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How people lose money in Stock Market

I wanted to write about this from long time but I did not find much time to do this. Actually I have researched more than a week to write about this. You all will be aware of stock market and how people are hooked into it and how people make money in it. Let us see the other side of the coin today. As you are aware stock market is one of the most risky paths to earn money. there are huge number of people who make a living out of stock market.

Now, how do people lose money?

Let us assume that a company, say XYZ which is dealing in textiles is doing well as privately held company. Then after a couple of years, it becomes so big that it has to become a public company (there are certain rules as to how a company can go public, let us not get into it right now). Now since the company is publicly listed in the stock exchange, the shares are traded in exchange. The face value of a share is Rs.10, and company has 10,000 shares. Hence the total value of the company is Rs. 1,00,000 (10 * 10,000). Generally while issuing the IPO the company decides what is the value of a share can be. I don’t know how the company or someone decides the value. The point I want to make is that it will be generally higher than face value. Continue reading

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A mail from Grandpa

I got this mail from my friend. A good one indeed.

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LATELY, I have been thinking a lot about the Lehman crisis . Spending money that they didn’t have and going beyond their means is one of the main reasons for their situation today. In fact that is the cause for the current economic crisis in the US .

When I see all this happening, I can only remember the good old days. Then, karz was bad. People looked down upon those who took loans. Parents would not give their daughter’s hand in marriage to a man with loans.

But of course, the times have changed now. Everyone I know has a loan. The buzz word is EMI (equated monthly installment) . Today, you can buy everything on EMI – a house, a television, an i-Pod. In fact I know of someone who just bought a fancy BMW 3 series on EMI, instead of buying a cheaper car outright with cash. I mostly prefer to take public transport, but then I am an old man with old thoughts! Continue reading

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Bankruptcy Explained

I got the following article in my mail. I thought of sharing it with You as well.

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Once there was a little island country. The land of this country was the tiny island itself. The total money in circulation was 2 dollars as there were only two pieces of 1 dollar coins circulating around.

1) There were 3 citizens living on this island country.  A owned the land. B and C each owned 1 dollar.

2) B decided to purchase the land from A for 1 dollar. So, now A and C own 1 dollar each while B owned a piece of land that is worth 1 dollar.

* The net asset of the country now = 3 dollars. Continue reading

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Poverty

I hope you have heard of blogactionday. On 15th October, it was about Poverty and about 13k bloggers around the world wrote about Poverty on a single day. It was overwhelming that all the people think about a single topic. It was really nice to see so many people share their views on Poverty. I read many blogs that participated on blogactionday. Some of them were interesting and some were not all that great. I did not think much about the Poverty and struggles since I feel it is all part of the game.

I know to an extent what Poverty is, what poverty can do to people. But that should not make anyone lose their dreams. I have a positive attitude towards life. I have seen people struggle and become financially stable. They have come up from poverty to become one of the few wealthy guys. It is nice to see them and learn from them. Life throws you many challenges and it is up to you to handle it. It is your life and it is you who decides what can happen to your life, if you lose the game you can’t blame on someone else except you. Continue reading

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