Friday, March 30, 2012

Amazing photos: The invisible Liu Bolin

 

Dubbed the Invisible Man, Liu Bolin of Shandong, China has created an art form of camouflage. The 38-year-old artist takes elaborately conceived photographs of himself blending in barely noticeable against his surroundings. Standing motionless for hours as he is painted over, Liu becomes a part of his backdrop, which includes everything from telephone booths to earthquake rubble. Authorities shut down Liu’s art studio in 2005 and since, “Hiding in the City”, as his series is called, is purportedly Liu’s continuing protest against the state’s crackdown on art and free expression. Enjoy these fabulous photographs, and see if you can spot the artist in them.

                 
                                capt-79ca63bbfa25b7599afb95fb0959948f

                               capt-4a8f3bdda8a7b5cf83287b9298051da5

   The invisible Liu Bolin

Yahoo.com






Should you put your money in company FDs?

Those who swear by fixed deposit (FD) have never had it so good. The rates offered by banks are high. Now, they have even better news from companies. There are around 100 companies offering FDschemes currently, and most of them offer at least 1% to 4% more than bank FDs. A three-year FD from Mahindra Finance, for example, gives 10.5%, while one from Jaiprakash Associates offers 12.50%. 

Compared with this, the State Bank of India andHDFC Bank offer 9.25% and 8.5%, respectively, for a three-year FD. You don't need to be an investment wizard to figure out that the rates offered by the companies are the best you can pocket and you should park some money in their FD schemes. But, don't commit the mistake of equating a company FD with a bank FD, say experts. This is because bank deposits are covered by a guarantee from the Deposit Insurance and Credit Guarantee Corporation of India, which assures repayment of Rs 1 lakh in case of default by a bank, but there is no such guarantee for company deposits. The safety of the FD rests firmly on the financial position of the company. That is why you have to be extra careful while choosing and investing your money in a company FD. "When investing in company deposits, do not get lured by high interest rates. Check the past track record and financial position of a company before committing your money," says Anup Bhaiya, MD and CEO, Money Honey Financial Services. 

Do A Thorough Check: Before putting money in a company's FD, try to get a rough idea about the company and its activities. "Go for listed companies as there is more information in the public domain about them," says Anup Bhaiya. The next thing you could do is check on the ratings for the FDs. "Go for companies which have an AAA or AA rating (for their deposit schemes)," says Trilok Mishra, a Mumbai-based financial planner. Check the promoter's background and financials of the company. If a company has a long history and is making consistent profits and paying dividends - HDFC and Mahindra Finance, for example, then your money in its schemes will be in safe hands. Both HDFC and Mahindra Finance have a sound past track record. 

This, along with their strong financial performance and strong parentage, makes them a good bet in the company deposit space. If the financial performance of a company has been erratic, and the promoters are not well known, you should think twice before investing in its schemes. A case in point is Morepen Laboratories. The FD holders of the company were left high and dry without any payments. In the end, as per a scheme of arrangement and compromise with deposit holders, the company gave equity shares to fixed deposit holders. You don't want to face such a situation, espe-cially if you are a retired person living on interest income from safe investment avenues. In the current scenario, you should avoid putting money in real estate companies, as most companies in the sector have taken huge hit due to the high interest rates and slump in the economy. "Even in the recent past, some real estate companies have been delaying repayment," says Shankar S, a certified financial planner with Credo Capital. 

Rates High? Check Why: Whenever you come across a company paying higher interest rates, try to find out why the rates are so high. Put simply, a company should have some reason to pay a higher interest than the prevailing market rate to depositors. Most often, you would find out that the company is paying a high rate because it is in some financial trouble and the higher rate is a way to compensate investors for taking the high risk of putting money in its scheme. If you know how to ask the question, you would get the answers from distributors and financial advisors. If you are convinced with the reply, you can put money in the FD. Otherwise, look elsewhere. 

Illiquid And Taxable: If the money you have is for use in an emergency, then company FD may not be the best investment option. If you have a bank FD, then in an emergency, all you need to do is walk across to your bank with the FD receipt and you can get your money back with no difficulty. Sure, there may be some penalties for breaking the FD, but you get access to the funds to be used for the emergency. But, a company FD cannot be redeemed so easily. Typically, these FDs can't be broken before six months from the date of investment. If you break it even after six months, you would get 2% lower than the promised rate. Also, it may take aminimum of three to five days to get the money back. Also, remember that interest income from company FDs is taxable. On this front, they are similar to bank FDs. It is always better to calculate the post-tax returns from an FD. For example, if a company pays 12% on its FD, your effective return will be 8.29% if you are in the highest tax bracket. However, if you are retired or in the lower tax slab or not liable to pay tax on your income, the returns could be attractive. 

Investing Finally: Experts advise against going overboard on company FDs. "You can invest up to 10% to 12% of your fixed income portfolio in company fixed deposits," says Shankar S. If your fixed income portfolio is worth Rs 50 lakh, for example, then Rs 5-6 lakh could be invested in company fixed deposits. It would be better to spread this amount across at least four to five companies. If you are retired and depend on interest income to meet your day-to-day expenses or your monthly liabilities, the money should go into only AAA or AA-rated companies. It would not be worthwhile to chase an extra 1% to 3% return at the cost of safety. Finally, opt for cumulative schemes to maximise your returns, as the interest earned would be automatically reinvested at the same coupon rates, which will generate better yield.


The Economic Times

L&T Finance buys Fidelity's mutual fund business in India


L&T Finance has agreed to buy FidelityWorldwide Investment's Indian mutual fund business, becoming the 10th-biggest equity fund house in a highly fragmented and competitive market marked by wafer-thin profitability.

The financial services arm of construction major Larsen & Toubro pipped rivals, including HDFC Asset Management and Pramerica, to purchase FIL. The deal will immediately boost L&T's assets to Rs 13,500 crore, making it the 13thbiggest fund and the 10th-largest on the basis of equity.

"A large part of the L&T Finance business is lending. This is part of the move to increase fee-based income which is a steady business over mid-to-long term," YM Deosthalee, chairman & managing director of L&T Finance Holdings, told a press conference.

Shares of L&T Finance rose 4.6% to close at Rs 49.80 on Tuesday after a late spurt. "It will be a turning point for L&T Mutual Fund and sad for the mutual fund industry, because a good fund house has decided to walk out of the country," said Dhirendra Kumar, managing director of fund tracker Value Research.

Experts say the deal will confer size on L&T. "This acquisition will catapult L&T Mutual Fund into the big league of Indian asset managers.

With an excellent blend of equity and debt assets, combined with a great brand in L&T and a complementary distribution network, this provides a great platform for L&T Mutual Fund to potentially attain market leadership," said K Balakrishnan, chairman & managing director, Lazard India.

But L&T's task of growing the business has been made difficult by global investor unhappiness over the weak performance of the Indian economy and the government's stumbling and erratic response.

The Budget has been widely panned and foreign investors have turned off the spigot after pouring over 45,000 crore into the markets during January-February 2012. FII purchases so far in March have been a measly $960 million.

The financial details of the transaction were not disclosed, but Deosthalee said the valuation is in line with that of recent deals in the mutual fund industry.

Industry sources said L&T has paid about Rs 530-550 crore to buy Fidelity, valuing the deal at 6.2% of Fidelity's total assets under management of Rs 8,881 crore as on December 31.

L&T, which entered the mutual fund industry in September 2009 by buying DBS Cholamandalam Asset Management, had assets worth Rs 4,616 crore as on December 31.
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Mutual fund industry sources said other bidders had offered to buy Fidelity at higher valuations than L&T, as much as Rs 600 crore, but these funds were not willing to absorb FIL's staff, which includes its sales and marketing officials.

However, the deal does not include the equity fund management team led by Alexander Treves, the chief investment officer of Fidelity Mutual Fund.

"The equity fund management team will be with us till the integration process is complete," said Deosthalee.

He said Fidelity's India Chief Executive Officer Ashu Suyash will be a key part of the integration process.

As per the agreement, L&T will absorb most of the employees of Fidelity Mutual Fund.

"Fidelity employees need not worry about this deal. L&T Finance is an equally strong brand. And historically, Indian funds have done much better than foreign fund houses," Deosthalee pointed out.

The deal comes at an opportune time for Fidelity, which is facing a regulatory deadline to shift its trading desk to India by September. The mutual fund industry has lurched from crisis to crisis since the global financial meltdown of 2008. 
The ban on entry load, the upfront fee that mutual funds charged investors to pay distributors, in August 2009 has compounded their woes as distributors now have lesser incentive to sell schemes. The key challenge for L&T will be to retain investors in Fidelity funds, many of whom had invested in the 'Fidelity' brand.

The deal will not make any sense to L&T if it fails to retain these investors, industry sources said. This is more so because apart from assets under management, which can be fickle most of the time, L&T Mutual Fund has not been able to buy out the experienced equity fund management team of Fidelity.

But L&T could take heart from the performance of Templeton and HDFC asset management houses after their takeover of Zurich and Kothari Pioneer in the early years of the past decade. The buyouts happened just before the equity boom of 2004-08, helping both fund houses build a sizeable advantage over rivals.

"We'll be able to retain investors... We're an equally good brand. We have good fund management capabilities to satisfy investors. The integration will also happen at the distributor level," Deosthalee said. Tough business conditions have prompted several fund houses to strike similar deals.

Japan's Nippon Life Insurance bought 26% stake in Anil Ambani-controlled Reliance Capital Asset Management, India's second-largest mutual fund by assets, for roughly Rs 1,450 crore. The deal valued Reliance Mutual Fund at 6.8% of its total assets under management of Rs 82,305 crore on December 31.

In December 2010, Paris-based Natixis Global Asset Management bought 25% stake in IDFC Mutual Fund valuing it at 5.5% of total assets. IDFC had bought Standard Chartered Bank's asset management business for close to 5.7% of its assets in 2009.

Earlier in 2010, US-based investment management firm T Rowe Price acquired a 26% strategic stake in UTI Asset Management Company, one of India's most profitable mutual funds with a large equity asset base, for about 3.6% of its assets under management.

In June 2010, Japan's Nomura bought a stake in LIC Mutual Fund for about 2.5% of the fund's assets. In 2009, IDFC bought Standard Chartered Bank's asset management business for close to 5.7% of its assets.

The Economic Times


Savings bank accounts giving fixed deposits a run for their money

The Savings bank account has had an extreme makeover of sorts during the last year. First, it was the deregulation of interest rates with the lower limit of 4% and, now, the announcement of tax-free interest to the extent of R10,000 in the Budget. Although this is an extremely positive move as far as the ubiquitous savings bank accounts are concerned, does it steal the thunder away from its counterpart — fixed deposits, which have hogged the limelight for a fairly long haul an investment avenue?
According to the Budget proposal, an individual/Hindu Undivided Family will get a deduction of R10,000 for the interest earned annually from savings accounts. Remember, this does not apply to fixed deposit interest rates; they are taxable as usual at normal rates.
A new Section 80 TTA is proposed to be inserted in the Income Tax Act to enable this deduction. This amendment comes into force from April, 2012, onwards and will be applicable for all subsequent financial years.
Investors are often advised to hold not more than three months of household budget in their savings bank; however, with the returns and the tax sops available, it could become one of the most sought-after investment avenues over time. Savings bank balances have started working harder for us; obviously, there is no complaining!
Banks’ reaction
With this announcement, there are numerous banks which have revised their savings bank rates. YES Bank raised interest rates on its savings bank deposits to 7% from the earlier 6%, for those customers having balance above R1 lakh (it will continue to offer 6% for balance below R1 lakh), making it the highest rate on savings rate deposit.
While HDFC Bank is offering 9% for R1 crore deposits over for a slab of 1-2 years on their fixed deposits and a slightly lower rate on their savings bank balance, Dhanlaxmi is providing 8% for 1-3 years for any amount on fixed deposits.
Lakshmi Vilas Bank also raised interest rates on NRE deposit to 10%. Clearly, the private banks are running up the altar in every which way to gain as much assets under management as possible in a quick time.
The PSU banks, however, are sitting pretty as they already have substantial funds under their wing.
Fixed deposits vs savings bank interest
A huge concern across the board is that it may take the sheen off fixed deposits, the banking product that has garnered most of the attention over decades as an investment avenue.
There could be a clear paradigm shift in individuals’ perception, given that savings bank account offers phenomenal liquidity, in addition to decent post-tax returns.
One can see in graph 2 that the difference has narrowed down; interest rates having peaked, going forward, the interest rate on fixed deposits may only moderate. The FD rates at this point are around 8.75-9% per annum and it could moderate and settle around 8-8.5% per annum over the second half of FY13, which could be yet another boost for savings bank accounts. Fixed deposits were already losing their battle against fixed maturity plans (FMPs) of mutual fund houses, now they have yet another investment avenue to fend off.
In the short term, the interest rates are expected to hover on the higher side, before they start their downward spiral, the loyalists could make their shift from fixed deposits during this period. Further, flexi-deposits which had caught the fancy of the investors could go completely out of fashion as interest rates start to correct.
Debt mutual funds vs savings bank balance
Debt mutual funds largely offered the liquidity facility and tax efficiency compared to fixed deposits. And with the recent amendment, this edge goes right out of the window as far as savings bank accounts are concerned.
Short-term mutual funds, such as liquid-plus funds, have been investing in T-bills, Call money, etc; they may now start investing in savings banks too, given that they offer similar liquidity and efficient returns.
Fixed maturity plans have often been compared to fixed deposits. If they are now compared to savings bank accounts, FMPs are likely come second best given the obvious liquidity advantage of savings bank accounts.
It will take time more before this amendment actually becomes the game changer on the debt instrument front. In either case, the investor is likely to have the last laugh!
The Indian Express

Thursday, March 29, 2012

Rupay Kicks Off with Debit Cards


The National Payments Corporation of India (NCPI) hasstarted Rupay, a domestic card payment network. NPCI already is at the back-end of the India wide bank ATM network and runs IMPS, the Interbank Mobile Payment Service. It has the ability to instantly find out, given a debit card, how much money you have in your account.
The first launch is for a debit card, which will be accepted in over 91,000 ATMs and 6 lakh PoS terminals, but in India only. They have tied up with DISCOVER (think Diners Club)  for international acceptance, which should help Indians travelling abroad (or buying off foreign web sites).
The first banks to offer Rupay Debit cards are Bank of India and Union Bank of India. The PoS terminal acceptance though, will include terminals from Axis Bank, Bank of Baroda, Corp bank and SBI. Conspicuous by their absence are the ICICI Bank and HDFC Bank, which have a large PoS Network around the country. (They’ll come on board. They have to.)
Fees will be cut substantially by using Rupay, by about 40% for banks and lower per-transaction fee for merchants.
Credit cards is next, but will only be available in March 2015. That’s three years away.
Will Rupay replace Visa and Mastercard? If transaction fees are lower and fraud instances can be handled well, I think a Rupay network could easily beat the current reach of Visa and Mastercard. While there are substantially more debit cards than credit cards (see chart), the value of transactions made on credit cards is higher. In Jan 2012, the POS transactions (non-ATM) were Rs. 5060 cr. (50.6 billion) on debit cards versus a larger Rs. 8868 cr. (88.68 bn) on credit cards. So we will see MC and Visa continue to serve more than 50% of the transactional space until at least 2015 when Rupay goes into credit cards, and perhaps five years after that until Rupay irons things out. So unless you have a 20 year horizon, you shouldn’t write off Visa and Mastercard in India.
(Why aren’t we doing things faster, NPCI? )
Will Rupay be accepted for online transactions? The press release says, “in due course”. There is currently no online payment gateway that supports it, and you don’t have that two factor authentication (that is, a second password known only to the card holder) for an online transaction that is currently done by the credit card layers at Mastercard and Visa.
(If you own a debit card, why not just do a direct bank transfer through netbanking? Most web sites support most banks anyhow. But debit cards are very popularly used for online transactions, so I presume there’s more to it.)
Is Rupay going to be more efficient? Of course it is. I’ve used IMPS and it takes a fraction of a second to transfer money from one account to another, even inter-bank. Fraud data analysis and redressal is also faster. So yeah, I think they can be way more efficient than Visa or Mastercard for Indian transactions. Plus it’s greater value for lesser cost – with no round trips abroad, there’s a saving on bandwidth (minor) and exchange rates/fees (major).
This is a must-watch. NPCI has been impressive, and I hope Rupay kicks off big time. I just wish it would move faster into credit cards.
capitalmind.in

Friday, March 23, 2012

Word of Mouth or Marketing Campaigns – What Sells for You?


“Pan Singh Tomar” What?? was the utterance from a friend who I invited to see the movie.
Yes no star and low budget movies are not marketed extensively hence not known to many and most film goers.
As against this RaOne was hugely publicised movie and hence though product was (technically superior but was) low on entertainment value was huge grosser.
Huge Hype can sale Inferior Product also. Similarly most products , not market extensively though better than highly marketed products and services are less known and hence less consumed. However things are changing , and changing fast.
In the case of Pan Singh Tomar Social media i.e. consumers themselves have taken up the job of marketing the product. Word of mouth publicity for the movie is drawing crowd to the theater. Problem with huge campaign and low product is that now social media can take out the air from their Tyre and same social media can add extra stepney to the good but lesser known products.
Kolavri D can go viral to become huge success similarly political unrest and rising can over throw governments – this is the power of social media. Companies rather than going for huge campaigns should now start spending & spreading on social media and whatever is saved can be used to better the product. In the case of movie invest in script and music. Let the people take charge of collective Chief Sales officer.

Tuesday, March 20, 2012

In long term, equity investment gives best returns

Its tax saving season and market is flooded with different type of tax-saving products. The hottest among them are the infrastructure bonds, long-term fixed deposit schemes, NSC and PPF’s. There are a lot of bond issues currently available and a lot many will hit the market till March-end. These products by nature do not provide above average returns to investors. Investors should be thankful to god if they get returns above the prevailing inflation which too is pretty difficult. In infrastructure bonds, you get tax exemption on initial investment of R20,000; so investment beyond this amount is not at all recommended.

With options like fixed deposit, NSC and PPF, liquidity factor comes into picture as the lock in period is very high. The above instruments are pure saving instruments and it’s a sin to think about capital appreciation with them.
So are there better tax-saving instruments available in market which even provides an opportunity of capital appreciation? Do not lose hope as there is one pretty good investment avenue which is equipped to provide both tax savings and capital appreciation. The instrument we will be discussing is Equity Linked Saving Scheme (ELSS). I hope you do not fear equities and your risk appetite is on the higher side.
What is ELSS?
Equity linked savings schemes (ELSS) are equity-oriented mutual fund schemes with an added advantage of tax saving under different sections of the Income Tax Act. Asset allocation is tilted towards equities without default. These schemes follow the theme of mutual funds but Investments up to R1 lakh in ELSS funds are eligible for deduction from taxable income.
Key Features
ELSS refers to equity linked saving schemes which is a type of Mutual fund which provides investors tax exemption under Section 80C. Some of the important features of ELSS are as follows
These are equity-oriented mutual fund schemes
Multiple ways of investment (lumpsum/using SIP mode)
Asset allocation towards equities can go in the range of 80 to 100%
As the allocation is biased toward high-risk-high-return assets like equity, the main objective of such funds is capital appreciation
Lock in period of three years
Tax exemption under Section 80C up to R1,00,000
Tax Benefit attached to ELSS
When you invest in ELSS you are eligible for following tax benefits
ELSS you are eligible for tax benefits under various sections of Income Tax Act
Investment up to a maximum of 1 lakh is eligible as deduction from taxable income under section 80 C
Capital gains which you get from the investment on redemption are tax-free under Section 10(38)
While holding the scheme the income you receive in the form of dividend is tax free under section 10(35) of Income Tax Act.
Negative feature of ELSS
Even though this product has great capital appreciation potentials together with tax benefits, there are few negatives too which one should keep in mind before investing. The main negative features are:
Lock in period of three years makes it illiquid in initial years
Returns on ELSS are not fixed and purely depends on the stock market performance
Investment Rationale – Why it is better than other investment options
Although ELSS has a lock-in period of three years, it’s advisable to invest in this scheme as the lock in period is still smaller than other tax-saving schemes like infrastructure bonds, long-term fixed deposits, PPF and NSC.
The performance of ELSS is linked to the market and it might sound risky to conservative investors, but the lock in period of three years comes to their rescue. We all know that in long run, equity investment is the one which gives best returns. So if you keep your money parked for three years, there is a bright chance that you will be sitting at handsome returns.
With other options you are at loss from both the sides. You have a longer lock-in period and there is an upper cap on the returns. Taking direct exposure in equity is not recommended if you do not have enough time for research. These funds are managed by experienced fund managers and you can gain from their experience.
The other feature which makes ELSS more attractive is the multiple ways of taking exposure. Although it’s recommended to take a lump sum exposure so as to keep the lock-in period fixed, you can also invest via SIP route.
In case of SIP your lock-in period of three years is counted from the date of investment. There are a lot of funds and there is enough data regarding them using which you can judge the performance.
Post analysis you can choose one of the best managed funds. Availability in Demat format makes them even more attractive as you are saved from the hassles of paper work.

Incentives for savings and investment got a big boost

The Budget provides direct incentives for boosting savings and investment, including tax breaks on interest earned on savings deposit and for investments in equity market by first time investors. Though the details of the Rajiv Gandhi Equity Savings Scheme have not been presented, the scheme along with the proposed central KYC depository (to avoid multiplicity of registration and data upkeep) as a facilitator, can bring in large number of new retail investors to the capital market.
Electronic initial public offerings and electronic voting makes for an easier entry and more transparency. Opening up of the debt market for qualified foreign investors, is proposed for wider participation. There is a proposal to amend the Indian Stamp Act, which might be a step to unify the stamp duty and remove an impediment to the development of the secondary debt market. All these collectively have the potential to boost savings and capital market activities.
Proposed capitalisation of banks, including regional rural banks, will enable better credit flow to infrastructure sector, particularly power, road and aviation and the new external commercial borrowing (ECB) policy which permits refinancing of outstanding rupee debt and availing for working capital needs. The enhanced provisions for rural housing, ECBs for low cost affordable housing and a Credit Guarantee Trust Fund have been designed to ensure institutional credit flow to housing sector.
Fiscal deficit is proposed to be reduced to a more sustainable level of 5.1%, as against 5.9% estimated in the current year. The projection is pragmatic. The Budget endeavours to restrict subsidies to 2% of GDP in 2012-13. It may be noted that the government has decided that subsidies related to food and for administering the Food Security Act will be fully provided for. All other subsidies will be funded to the extent that they can be borne by the economy without any adverse implications. Subsidies are to be better targeted and directly transferred to the beneficiaries, which would be facilitated by the UID and Aadhaar exercise.
There is no explicit measure announced in the Budget, which could be of direct benefit to the mutual funds. The various measures proposed for the capital market are expected to benefit funds by boosting markets and improving valuation and investment inflows. The mutual funds would also benefit once pending procedural measures are taken for inflow of QFI funds in the Indian mutual funds and capital markets. There is also a case for rethinking the Rajiv Gandhi Equity Savings Scheme to extend stated benefits for investment in close ended equity schemes of mutual funds, instead of exposing the small uninitiated retail investors directly to the uncertainties of the market.
Proposed measures for fiscal consolidation, capital market, easier ECB regime, investment in power, road and aviation, as well as in other sectors with linkage effects are positive. These are expected to create favourable sentiments. The deficit and borrowing figures for fiscal 2013 are, however, higher than what the markets expected. Further, the market is perhaps not yet convinced of the possibility of restricting the budgeted deficit and borrowing figures, particularly in the background of uncertainty in Iran which could lead to a spike in crude prices. The yield on 10 year G sec closed at around 8.4 % on Friday.
There are fears of cost push inflation consequent upon excise duty hike. The challenge lies in streamlining implementation of the various proposals so as to get the expectations right, have a moderate inflation, and expect no nasty global surprises like unsustainable crude prices. The most significant resolution is to restrict subsidies and fund them to the extent they can be borne by the economy without any adverse implications. Are we moving fast to a new subsidy disbursement model?

Small savings set to fetch higher returns

There is finally some good news for individuals in a season of duty hikes and provident fund rate cut. The government is raising interest rate on small savings schemes such as National Savings Certificate (NSC) and post office deposits by 20-50 basis points.

The new rates will, however, be applicable on investments that you make from April 1 and not on those that you park over the next 10 days to meet your tax saving requirements.

As a result, NSC and public provident fund (PPF), which is a voluntary deposit as opposed to employee provident fund, will earn you 8.8-8.9% instead of 8.6% a year. The shorter tenure deposits, such as term deposits in post offices, are expected to fetch you more than the longer tenure products such as PPF or the 10-year NSC. Savings bank accounts in post offices will, however, not see any change as the 4% return is in line with what most banks pay at present.


The increase in small savings rates, which is expected to be notified by the finance ministry, is in sync with the new policy to link returns on the popular savings instruments with the interest rate on government bonds.

Bank deposits may, however, look more attractive to many as they offer 9% return. But a scheme like PPF, which has a minimum term of 15 years, comes with additional tax sops. Not only is it part of the 80C benefits which entitles tax payers to get a concession of up to Rs 1 lakh a year, but the interest earned on the deposits is also tax-free. So, at the revised rates, the actual return for someone in the 30% tax bracket will work out to 12%.

In addition, the rate of return on small savings schemes that will be notified will be for the full financial year, while bank deposit rates are expected to come down with the Reserve Bank of India widely predicted to begin the rate cut cycle. Even before lending rates come down, banks will start pruning returns on deposits to lower their cost of funds.

The move to raise small savings rates comes barely a fortnight after the Employees Provident Fund Organization (EPFO) slashed the annual return from 9.5% last year to 8.25% for the current financial year based on a decision taken by the finance ministry. In the budget, finance minister Pranab Mukherjee decided to increase the excise duty and service tax rates from 10% to 12% which will put a burden of Rs 35,000 crore on anyone buying a matchbox or a car. He, however, offered some concession by way of an increase in exemption limit for direct tax from Rs 1.8 lakh to Rs 2 lakh.

Friday, March 16, 2012

How to Sell Yourself at a Job Interview


Do you Know How to Turn Tough Interviewer Questions Into Knock Out Strengths?
  
Once at the interview, you are going to be asked a lot of questions by your potential employer. They will ask about you in particular such as what your strengths and weaknesses are. You might want to prepare for answering questions by listing some of your attributes. Talk to former co-workers with whom you worked closely. Ask them to list some traits about you that they most admired -- work related, of course.

Try to find some faults as well. You won't, obviously, spontaneously tell a prospective employer about these faults, but you may be asked to. One question that sometimes comes up in an interview is "What is something that has been a problem for you at work?" By studying your faults, you will be able to choose one that is somewhat innocuous or could be turned around into a positive.

For example, I’ve always been a very organized person – almost to the point of obsessiveness. However, employers look at organizational skills as assets not liabilities. So in an interview, I would tell them one of my shortcomings was that I wanted to be too organized.
Practice how you will answer possible questions in an interview. You want to seem somewhat spontaneous, but you also want to appear self-confident. The way to do that is to rehearse, not exactly what you will say, but how you will say it.

A great method is to rehearse in front of a video camera. Study your posture, the way you make eye contact, and your body language. If you don't have a video camera, a mirror will do. Have a friend do mock interviews with you. The more you repeat a scenario, the more comfortable you will begin to feel with it.

When it comes down to it, isn't this the main point of the interview? Speak slowly and clearly. I tend to speak very quickly, so this is something I must pay careful attention to when I am on an interview. Pause before you answer a question. Your answers will seem less rehearsed and it will give you a chance to collect your thoughts. Keep in mind that a very brief pause may seem like an eternity to you. It's not.

Since the interviewer's job is to make sure that not only your skill, but your personality as well, is a good match, you must establish rapport with the person or persons interviewing you. That begins the instant you walk in the door. Let the interviewer set the tone.

Nothing is as awkward as offering your hand and having the gesture not returned by the other person. Therefore you should wait for the interviewer to offer his or her hand first, but be ready to offer your hand immediately. Some experts suggest talking at the same rate and tone as the interviewer. For example, if the interviewer is speaking softly, so should you.

It’s alright for you to show your true personality, but be careful not to go too over-the-top. I am a very bubbly, naturally outgoing person who tends to get a little hyperactive in stressful situations. I also have a gift for humor which tends to make people feel comfortable with me.

In job interviews, I’ll try to tone down the excessive energy that I usually have and inject some humor into the conversation. This helps relax both me and the person doing the interview and we’re able to communicate much easier.

They say that body language gives more away about us than speech. Eye contact is very important but make sure it looks natural. A smiling, relaxed face is very inviting. Hands resting casually in your lap rather than arms folded across your chest also is more inviting. If you normally move your hands around a lot when you speak, tone it down some. You don't want to look too stiff, but you don't want to look like you're a bundle of nervous energy.

So what kind of questions can you expect during your job interview? Here are a few to think about along with some possible answers:

  • Tell me about yourself. (They are not looking for personal information here)

My background to date has been centered on preparing myself to become the very best _____ I can become. Let me tell you specifically how I've prepared myself...

  • Why should I hire you?

Because I sincerely believe that I'm the best person for the job. I realize that there are many other college students that have the ability to do this job. I also have that ability. But I also bring an additional quality that makes me the very best person for the job--my attitude for excellence. Not just giving lip service to excellence, but putting every part of myself into achieving it. In ... and ... I have consistently reached for becoming the very best I can become by doing the following...

  • What is your long-range objective? Where do you want to be 10 or 15 years from now?

Although it's certainly difficult to predict things far into the future, I know what direction I want to develop toward. Within five years, I would like to become the very best _____ your company has. I would like to become the expert that others rely upon. And in doing so, I feel I will be fully prepared to take on any greater responsibilities that might be presented in the long term.

  • How has your education prepared you for your career?

As you will note on my resume, I've taken not only the required core classes in the _____ field, I've also gone above and beyond. I've taken every class the college has to offer in the field and also completed an independent study project specifically in this area. But it's not just taking the classes to gain academic knowledge I've taken each class, both inside and outside of my major, with this profession in mind. So when we're studying _____ in _____, I've viewed it from the perspective of _____. In addition, I've always tried to keep a practical view of how the information would apply to my job. Not just theory, but how it would actually apply. My capstone course project in my final semester involved developing a real-world model of _____, which is very similar to what might be used within your company...

  • What is your greatest weakness?

I would say my greatest weakness has been my lack of proper planning in the past. I would over-commit myself with too many variant tasks, then not be able to fully accomplish each as I would like. However, since I've come to recognize that weakness, I've taken steps to correct it. For example, I now carry a planning calendar in my pocket so that I can plan all of my appointments and "to do" items. Here, let me show you how I have this week planned out...

  • What attracted you to our ad over others?

I approach my job hunting strategy pretty much like I approach my work. I took some time to think about the skills I want to use on my next job, the industry I'd like to work for and the location I want. I did some research on companies that were advertising and knew this company had the qualities I am looking for in my career and future.

If you are interviewing for a sales job, it’s entirely possible that the interviewer will ask you to sell him or her something. For example, I had one prospective boss who laid a pen on the table between us and told me to “sell” him the pen. What he wanted was to see how my persuasive skills were and if I could point out the great aspects of that pen to motivate him to “buy” it.

Usually toward the end of the interviewer, the person conducting it will ask you if you have any questions. You should have some. As in every other aspect of the job search, you are trying to show the employer how you can fill their needs. By asking certain questions, you are putting yourself in the job and showing the employer how you will satisfy the employer's needs. Here are some questions you may want to ask of the interviewer:

DIRECT TAXES

While the DTC has been delayed, (due on-going work on the same done by the Parliamentary Standing Committee on Finance), the Budget 2012 has move a step closer to DTC by increasing the base exemption limit to Rs 2,00,000 (from the present Rs 1,80,000). Similarly the DTC rates have been proposed to be introduced for personal income tax. Thus now personal income tax slabs are proposed to be as under for general category of individual tax payers which will provide a relief of Rs 2,000 for individual tax payers: 

Income-tax rates in Budget 2012
Taxable IncomeTax Rate
Upto Rs 200,000Nil
Rs 200,001 to Rs 500,00010%
Rs 500,001 to Rs 10,00,00020%
Rs 10,00,001 & above30%

Some numbers will help us better recognise the impact of this move. 

2011-12
Taxable Income (Rs) 10,00,000
Upto Rs 180,000Nil 
Rs 180,001 to Rs 500,00010%32,000
Rs 500,001 to Rs 800,00020%60,000
Rs 800,001 & above30%60,000
Tax payable 152,000
Education Cess3%4,560
Total Tax (Rs) 156,560
 
2012-13
Taxable Income ( Rs ) 10,00,000
Upto Rs 200,000Nil 
Rs 200,001 to Rs 500,00010%30,000
Rs 500,001 to Rs 10,00,00020%100,000
Rs 10,00,001 & above30% 
Tax payable 130,000
Education Cess3%3,900
Total Tax (Rs) 133,900

Let's take the case of a male individual whose net taxable income is Rs 10,00,000. As per the current tax laws his income tax liability will be Rs 1,56,560 (for FY 2011-12), while in the FY 2012-13, once the new base exemption limit applies, his tax liability will work out to Rs 1,33,900, i.e. a saving of Rs 22,660. 

For Senior citizens nothing has changed, the base exemption stands at Rs 2,50,000 while the qualifying age for senior citizens stands at 60 years. Also in the previous budget 2011-12 a special category called "Very Senior Citizens", age 80 and above with the base exemption limit at Rs 5,00,000 still prevails. 

In addition to this, the Budget 2012 has also laid down a few sweeteners: 
  • Deduction of upto Rs 10,000 for interest from savings bank accounts for individual tax payers
  • Deduction of upto Rs 5,000 for preventive health check up
  • Senior citizens not having income from business proposed to be exempted from payment of advance tax
  • Reduction in Securities Transaction Tax (STT) by 20% to 0.1% on cash delivery transactions
  • Exemption from Capital Gains tax on sale of residential property, if sale consideration is used for subscription in equity of a manufacturing SME for purchase of new plant and machinery.
Corporate Tax
As far as corporate taxes are concerned the rates have been kept unchanged but the rate of withholding tax on interest payment on ECBs is proposed to be reduced to 5% from 20% for 3 years for certain sectors. 

In order to moderate the outgo of profit-linked deductions a proposal to extend the levy of Minimum Alternative Tax (MAT) to all persons, other than companies, has been put forth. 

We think the proposed increase in the base exemption limit, would provide some relief to a large number of individual tax payers, as it means more disposable income in the hands of consumers, which may drive the consumption story. 

Vigilance on tracking unaccounted money:
  • Introduction of compulsory reporting requirement in case of assets held abroad
  • Allowing for reopening of assessment upto 16 years in relation to assets held abroad
  • Tax collection at source on purchase in cash of bullion or jewellery in excess of Rs 2 lakh
  • Tax deduction at source on transfer of immovable property (other than agricultural land) above a specified threshold
  • Tax collection at source on trading in coal, lignite and iron ore increasing the onus of proof on closely held companies for funds received from shareholders as well as taxing share premium in excess of fair market value
  • Taxation of unexplained money, credits, investments, expenditures etc. at the highest rate of 30% irrespective of the slab of income