Engineer's Finance

IOCL reported a loss of Rs. 7,047 crore for Q2 2008. Last year during the same quarter it reported a profit of Rs. 3,818 crore.

How does a company like IOCL lose so much money? I thought petroleum business is the safest and people always mint money. I think I have to reconsider my views. Petrol is always referred as black gold and investing in gold does not hamper your chances of hitting the bull’s eye. Continue reading →

RBI has again slashed the Cash Reserve Ratio and Statutory Liquidity Ratio by 1 percent and Repo Rate by 0.5%. RBI is taking measures in order to ensure that there is enough liquidity in the financial system. This move by RBI will add around Rs. 85,000 crore into the financial system.

RBI in the month of October has made several announcements to ensure there is much needed liquidity in the system. Around Rs. 270,000 crore has been pumped into the system. Most of the pundits feel that it is a good move but still they are not sure about this move. As you are aware that the global financial system is in mess and all the nations around the world are trying their level best to keep things afloat. None of them are certain about the outcome and all that they are doing is to ensure that the economy of their nation does not get into recession. Continue reading →

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 →

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 →

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 →