March 2009 - Posts - Initial Private Opinion

March 2009 - Posts

Infrequent postings

Posted by Sandeep Parekh at 
Many thanks to my students of this year for voting me highly in their evaluation of my teaching. It was great to have you too. Enough teaching for the time being, now it is time for me to become a student for a few days. I am going to the Kennedy School of Government for a course on ' Global Leadership and Public Policy for the 21st Century '...

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Satyam - auction of prima donna?

Posted by Sandeep Parekh at 
The conditions of the new Satyam Board in auctioning part of the company is quite baffling. Here is the list I could figure from newspaper reports: The process bars the successful bidder from selling or disposing any material assets for two years. A three-year lock-in period for the winner of the bidding process on its entire shareholding from the date...

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SEBI Board - suppression of key findings

Posted by Sandeep Parekh at 
A newsreport today titled " Sebi hushes up bench’s orders on Bhave's cases " in the Times of India, is a news which is likely to dwarf the Satyam news in its repercussions. In a clear damnation of the rest of the Board, two members of SEBI accuse the Board of the regulator and its Chairman - on charges of suppression of an order passed...

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RTI application on SEBI transparency

Posted by Sandeep Parekh at 
Recall my previous posts about seeking information on SEBI agenda items and minutes, its denial and my appeal before the SEBI appellate authority for 'Right to Information'. Well it got decided against me. It states the following: a) "the RTI Act does not expect the respondent to create soft copy from hard copy merely because the appellant...

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Wall Street strikes back - gimmeabreak

Posted by Sandeep Parekh at 
In a rather aggressive attempt, CEOs of Citi, Bank of America and JP Morgan have criticised the US congress' attempt to tax bonuses by upto 90%. While I can't comment on the constitutionality of the provision - though some people have opined on it, I find the provisions entirely fair. The proposal is that if a) you have borrowed taxpayer money...

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SEBI and SEC funding

Posted by Sandeep Parekh at 
The corporate counsel blog reports about the damage done to the US securities regulator SEC by poor funding by the government when it needed it most. In stark contrast the Indian securities regulator faces the criticism that it is sitting on too much money. SEBI in fact runs primarily on fees collected from intermediaries etc. (and interest on the corpus...

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Madoff hurts Indian regulators

Posted by Sandeep Parekh at 
Last week I was in a marathon session of conference speeches in Delhi and Mumbai. In almost all of them I mentioned how our regulatory system worked better than say the American system. I mentioned how, Ramalinga Raju is in jail while Bernie Madoff with a 40 times bigger scandal to his debit was under house arrest and was busy mailing jewelery to his...

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Reduced disclosures for rights issues - SEBI discussion paper

Posted by Sandeep Parekh at 
SEBI has put out a " Discussion paper on rationalisation of disclosure norms for Rights Issues ". In brief, the paper seeks to reduce the disclosures by companies seeking to come out with a rights issue based on the recommendations of the disclosure advisory committee of SEBI. This is a flawed recommendation as it seeks to reduce disclosures...

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G20 - if wishes were horses

Posted by Sandeep Parekh at 
Financial Times has a terrific graphic on expectation of various countries from the G20 meet: G20 Wishlist Now don't get too optimistic with the outcomes from this meet. PS: A statement from the finance ministers and governors of the G20 countries is out. As expected, it commits to nothing at all. (14th Mar 09) Share this post: email it! | del.icio...

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Jack Welch and shareholder value

Posted by Sandeep Parekh at 
TT Ram Mohan has a post criticising Jack Welch's recent outburst on 'shareholder value' being irrelevant. I fully agree with his critique of the otherwise brilliant man: "I wouldn't have minded if he had put forth sound arguments for his contention. I can't see any. Welch says: On the face of it, shareholder value is the dumbest...

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Satyam auction - illegal disclosures?

Posted by Sandeep Parekh at 
Today's Mint has a piece by Manas Chakravarty and Mobis Philipose - " Minority shareholders at Satyam being short-changed ": "Why the company’s shares continue to be unstable even two months after B. Ramalinga Raju confessed to the swindle is that shareholders are still in the dark about its financial health. While it’s true that...

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Financial sector reforms - IBA

Posted by Sandeep Parekh at 
Two days back I was at a well attended International Bar Association conference on business law held in Mumbai. On a panel that I was on, about financial reforms, I gave my usual more-negative-than-thou theory to all the panelists who spoke about we'll-be-ok-in-two-quarters spiel . I made three short points of reforms in this era. First , we should...

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Financial crisis humour - necessary cost cutting

Posted by Sandeep Parekh at 
Here is an excerpt from a piece from the New Yorker : "Mr. Pepall, every day is now casual Friday for you. In fact, you don’t even have to bother getting out of bed. If time is money, mazel tov—you are now a rich man. To those of you in Quality Control: As indicated by the new sign in your rest room, employees must wash their hands before not returning...

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