Arrests of seniors and Sufferings of juniors

The Satyam fiasco has replaced the Global Recession in much of the prominent space in the newspapers. From the porposal of acquisition of Maytas, the fudging of funds & the head-count of employees and the concerns about its future, Satyam has been in the news for all the bad reasons. Slowly different stakeholders of the scam are being revealed and interrogated. After the man who ran the show, the CEO and the CFO had to follow the suit. Then came the arrest of the partners at Pricewaterhouse which was a step to include the liability of an outside firm if not actually transferred. Who is going to follow next????
This has invoked ICAI, the institution regulating the working of the auditors, to take steps to save its image from being tarnished. One of the steps being suggested is to suggest SEBI to have a declaration from all listed companies that none of the partners of its auditing firm has been involved in any unlawful activity. If this is accepted, the implications are mind-boggling. The recruitment at the auditing firm will not only be further streamlined, the costs shall further enhance as risk-premium and the entire process may also have to be re-visited. The fresh finance studs already suffering from global crises, are likely to suffer more because of this.......

Is some one safe???????

The financial crisis in US has hit every one across the globe, though the impact has been non-uniform depending upon the exposure to the outside world. Japan's largest insurance company going bankrupt, is a recent example of such impact.
Although regulated to a good extent, the Indian bourses are having a bear phase with markets dipping down at a great pace. No expert will suggest anyone to invest in the share-markets. With ICICI Bank being in the news for all the bad reasons, people have started withdrawing their deposits from the bank putting huge pressure on the liquidity condition of India's 2nd largest Bank. Withdrawal of mass deposits is also coupled with the slowing of loan repayments, thereby putting more pressure on the bank. The share-price of ICICI has gone down from Rs. 1300/- to some 300s in no time. The best option that a common man can think of these days is to keep his money under the pillow as it may be the safest place. The so-called 'balanced portfolio' is losing its existence. All the financial laws & theories are being put to test in the prevailing scenario and any good news is something to cheer for, provided it is not accompanied by any unwanted news.

The Rescue Operation

With the whole world being dicey about investing in financial markets owing to crisis at the Wall Street, there is one man who can make all the difference and he is Mr. Warren Buffet. He is a man who has the reputation of turning the tables at any point of time. His investment of $5 Billion in Goldman Sachs has provided the much needed support for he financial markets to stabilize. Rated as the undisputed number-one investor, he is likely to be the opinion leader for rest of the world to follow and the trust in the markets will be revived. It is not only going to benefit Goldman but the entire financial community with the revival of trust of the so-called common investors. What the proposed Federal bailout of $700 billion might not do, can be done by $5 billion of the 'Omaha Oracle'. So it is not only the amount but the source of the amount that can make the difference and if the source is the top-shot Mr. Buffet unexpected is bound to happen.

Lehman-A shock for even a layman

Lehman Brothers has become the buzzword these days. The shocks of the crises of one of the largest investment banks are being felt globally. It is just the intensity of the shocks that can vary across organisations and across countries depending on their exposure to the big daddy. You name any problem or tension these days, whether it be fall in share markets or volatility in currency exchange rates and even B-School placements, the cause is being related to Lehman. The reason for such an impact is not only the direct exposure to Lehman but also the indirect linkages associated with it. The buying of Merill Lynch by BOA has to some extent saved the world from further dire consequences. Now all eyes are on the fate of American International Group (AIG) as it is also sailing in a similar sinking boat as Lehman was sailing which led to its eventual bankruptsy.

Judiciary under Scanner

After 'Independence of Judiciary' and 'Judicial Activism', the buzzword has changed to 'Judiciary under scanner' or 'Judicial Impeachment'. The most respected institution in the country is under threat these days with allegations of corruption being levelled against the Judges. The proceedings of impeachment against a High Court Judge came as a shock in the legal fraternity. Such proceedings are launched very rarely and has been only the second time in the history of Independent India. The weed of corruption has not even left the Judiciary which is characterised as being unbiased and neutral. The Chief Justice is actively trying to remove this weed by taking all possible steps to curb corruption at various level of Judiciary. Granting permission to CBI, for inquiry involving two judges of Punjab & Haryana High Court, is an example of his pro-activeness. If such instances continue over a period of time, the whole institution of judiciary with come under threat of loosing the respect of the general public. However, while taking such steps, a balance has to be maintained so that both the purposes, of curbing corruption as well as protecting the Judiciary from being exploited by the other two organs, viz. executive and legislature, are solved. The mechanisms involved in checking Mal-practices need to be revised and a summary procedure needs to be introduced whereby judicial panels should decide such cases. These panels can consist of Judges of other high courts, retired judges, etc. This procedure can be similar to the cort-martial proceedings in the army which is totally internal . It will protect the Judicial institution as a whole and also keep a check on the judges. Despite having the chances of being called the court of the courts, such a system can be very efficient.

123 India go

The waiver given by the Nuclear Supplier Group (NSG) is indeed a landmark decision breaking the conventions. As discussed in my previous blog, India's statements were to make a lot of difference and it happened so with Austria stating that the last day statements issued by Delhi were decisive enough for it to support the waiver. The impact, that such statements can have, is more than one can imagine.

Now that the waiver has been granted, India is all set to emerge as a major player in Global Nuclear trade after the US Congress gives its assent. However, it remains to be seen that which of the NSG nations actually come forward to trade with India as there may be some nations who did'nt oppose the waiver of not signing he NPT or CTBT but may have their own resevations in actually trade with India.