Indian Inflation turns negative

For the first time since 1977, India's WPI Inflation rate fell to -1.61% for the week ended on June 6 2009!

SEBI mandates Rs. per share dividend declaration

In a good move, the Securities and Exchange Board of India, SEBI, has asked listed companies to declare dividends on a per share basis rather than on a percentage basis. For example, a company having shares of face value Rs. 10, and declaring a dividend of Rs. 5, will have to say that it has declared a dividend of Rs. 5 per share and not a dividend of 50%.

This is meant to bring more clarity to an average investor who sometimes gets caught up in the jugglery of percentages and values when companies declare dividends. Thus, it will bring uniformity in the declaration of dividends by listed companies.

The move will clear the confusion among share holders whether the dividend declared was a percentage of the face value or the market price. It also becomes relevant when companies reduce the face value of shares over a period of time, which some investors might not be able to track.

Also, the calculation of actual returns in terms of Rupees becomes much easier, when the dividend information is available on a per share basis. Share holders will just have to multiply the number of shares they own by the dividend per share amount that the company declares. And for the mathematically inclined, they can just go ahead and calculate the dividend percentage if they want.

The change will be with immediate effect. More news here.

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The Stock Markets may be on Recovery

The Indian Stock Markets have performed promisingly well in the last few weeks. Though the performance wasn’t an all-round one comprising many different stocks, few of them upped the ante of the markets and had set the mood.

While it can’t be said with certainty that the economic slowdown and the stock markets are on a recovery path, there are few factors which may make it happen.

1. The economic stimulus packages issued and to be issued by countries world-wide would have created confidence in investor minds that the markets may not go down further if they put their money in.

2. Monetary policies (reduction in CRR, prime lending rates etc.) by governments that result in more money in the hands of people there by increasing their spending and investments (or, increasing liquidity in the economy), improving the economic situation.

Meanwhile, here’s a list of 10 stocks, compiled by Economic Times, which rose by more than 100% in the current market recovery.

India’s new Bimetallic 10 Rupee Coin

I might be a little late on this news, but here’s the picture of the new (and first ever) bimetallic coin of Rupees 10 denomination issued by the government of India. The outer ring of the coin is made up of Aluminum and Bronze alloy while the inner section is made up of Nickel and Copper alloy.

There are two themes for the coin.
1) Unity in Diversity and
2) Connectivity and Information Technology.

The coin in the picture has the first theme, Unity in Diversity.

What makes Swiss Bank Accounts safe and secure?

Recently, discussions about Swiss Bank Accounts came into prominence in Indian media further to the revelation that Indian nationals have a whopping 1456 billion US dollars in Swiss Bank accounts. This means Indians have more money in Swiss Bank Accounts than the rest of the world combined. Leaving aside this story, let’s concentrate on Swiss Bank Accounts and what makes them safe and secure.

In many novels and films, we have seen intriguing stories associated with Swiss Bank Accounts, like in Bourne Identity, Da Vinci Code etc. Even though most of these actually don’t happen in a Swiss Bank Account, lots of people consider Switzerland to be a place where they can keep their money safe and secure. There are a few factors that make it so.

The Banking Act of 1934 was passed in Switzerland to prevent Swiss Banks from divulging depositor information to other countries during world war period, with which those countries tried to confiscate the assets owned by the customers of Swiss Banks, especially the Jews, in the name of “the good of state”. But then the Act stayed on and provided enough privacy to depositors of Swiss Bank Accounts.

Switzerland is a very stable country and it maintains a policy of neutrality with other countries. It maintained neutrality in both World Wars, is not a member of the European Union and was not even a member of the United Nations until 2002. That’s why many of the world organizations have their headquarters in Switzerland. Thus the country doesn’t have a need to succumb to pressures from international treaties and obligations. All these make its economy robust and the banking system highly stable.

Also, Switzerland is a tax haven for depositors of other countries. For nonresident depositors of Switzerland there are no taxes if they don’t reside in EU or don’t invest in Swiss companies, making it a promising place to put their money in.

Good Reads
- How Swiss Bank Accounts Work?