Wednesday, January 07, 2009

Bad start to the New Year

We all boast of being in corporate world and read news channels and sites all day sitting at office. But do we really know what exactly is happening in the office of the chairman of a company. Even we invest in stocks just by friends word or some agency word and we doesn't really know whats happening in the company. Even the employees in the company would not know the exact situation of the company until the day it suddenly states of bankruptcy.

I am writing this post as today I have got two shocking news. One the suicide of Adolf Merckle and other Ramlinga Raju resignation with the confession letter to SEBI.

I have many friends in Satyam, none of them knew that this was going to happen. Leave the employees even the board members and the investors did not have a clue about this fraud. If this is the case then what would be situation of a small employee and a small investor of the company who simply believe in a company by reading their values written in the sites and shown in the news headlines and channels. Now I pity all those thousands of investors and thousands of Satyam employees who would be going through a trauma thinking about their future with Satyam. Does this make any sense that because of a mistake of one person so many thousands have to suffer?

Coming to suicide of Adolf Merckle, he holds the major part of Heidelberg Cement which is the worlds number 2 cement company. My friend Surya has recently joined in that company as a Associate to CEO. He was clueless about the Merckle Volkswagen investment until his CEO has told him very recently. None of the company heads knew that this situation would come for Merckle. Though I do not have much idea on this company and industry, I thought I would mention about this company because my friend may lose his job when the management change hands.

Hope these things would come to light early and people would not face any problems because of a mistake done by one single person.
Posted by Mr. Cool at Wednesday, January 07, 2009

4 comments:

Anonymous said...

Bubs, these experiences I guess are called "GROWING UP".

In a lighter vein, I pose the following questions to you. Mind you, I was a victim and sufferer way back in 2001, being part of ENRON.

1. Do we need to boast about being part of the corporate world ?

2. Why are we expected to know the happenings in the office of a chairman, apart from public documents from the same office statutorily accessible for employees and investors ?

3. Is it right to invest in stocks, doing no analysis, and believing in just the word of mouth ?

4. Anyone indulging in a 'FRAUD' will he be doing it in such a explicit manner, so that people gets educated about the fraud ?

5. Why do the thousands have to suffer, they just need to move on, just like post ENRON etc ? Isnt it?

6. "Hope these things would come to light early and people would not face any problems because of a mistake done by one single person."

HOW ?

Note: People who have unplanned lives ( financial ) will suffer the most in these kind of circumstances. It is stunning to see folks making 3 to 10 lakhs per year and having 25 to 75 lakhs loans. Same is the case with folks who don't think about their spending habits.

These habits and life style make sure that we are in control of our pay check.

Welcome to the hire and fire aspects of the corporate world, and kiss good bye to the 15 to 20% salary hikes every year.

Gather what is remaining, and move on. Update your resume, get ready for a lower salary, adjust your life style, sell that expensive car, minimize and reduce your monthly fixed payments, and get your next job.

When the next wave of economic boom comes, lets change the life styles accordingly, or lets maintain a steady life style through boom and bust.

My final take, any one buying a stock through hear way stuff, deserves to lose his/her money.

1/08/2009 10:33:00 AM
Mr. Cool said...

Hey that was a wonderful post and I accept that I am just new to this Hire and Fire concept as I have not seen it closely.

Coming to your questions, they were just generalized statements that I have posted.

1. We don't need to boast about it, but in my case when I see the government offices and officials and the way things are dealt there, yes I feel good and boast about the way things are handled here in the corporate world. I am definite that you will have another good point to contradict this :-).

2. I don't mean to say that we have to know all the happenings in the chairman's office, but I would say that at least the employees should have a hint of some events, at the closure of the company rather than telling them on the last day.

3. No. But in India many do that and have done that. The statement was just to show some pity towards them.

4. We definitely do not know the inner side of the story. I don't mean to say that FRAUD will be known before hand. But when the head of the company himself has done this then what others can do.

5. People will move on. But it would be a difficult phase of life for many people at this point of time.

6. I don't know :-).

I have to say one thing here. I have taken your point of saving money equivalent to 5 or 6 months of pay packet and be prepared for the worst. This I have already started implementing, saving some amount every month especially for this. Hope I don't get such a situation in near future to see the worst.

Coming to " These habits and life style make sure that we are in control of our pay check. ", I am very seriously working on it.

I liked this statement:
" When the next wave of economic boom comes, lets change the life styles accordingly, or lets maintain a steady life style through boom and bust. ".

1/08/2009 04:26:00 PM
Anonymous said...

1. "These habits and life style make sure that we are in control of our pay check.
"

The above should have been..

"These habits and life style make sure that pay check is in control of us. "

But I guess you got the zist of what I was trying to point out.

2. Emergency funds( which will enable you( family ) to live your standard life) enough for 1 year plus 20% premium for inflation, is one thing we can do to be prepared for these kind of contingencies.


My post was not intended personally against you, it was very general, but I'm glad you picked some value out of it. As Ammamma says, WISE people learn out of others experiences :) You are a WISE dude.

1/09/2009 12:50:00 AM
Mr. Cool said...

Points noted and already in process of implementing them ...

Thanks for the Wise dude compliment :-)

1/09/2009 04:50:00 PM

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