Samurai-- the market or the battlefield ??

Samurai market is usually used by non-residents of Japan, with a reference to the iconic Japanese warrior - the samurai. It is the slang term for the stock market in Japan. This market is where non-Japanese entities can launch public bond issues to raise yen finance.Issuance in the samurai bond market has more than tripled over the past several years. Some observers have attributed this growth to a systematic underestimation of credit risk in the market.

This Tokyo Foreign Bond Market(the so-called Samurai market)was created in 1970,with a public offering of yen bonds by the Asian Development Bank. Japan was then one of the largest debtors of the World Bank. Supported by consecutive current account surpluses, the government decided to create the Samurai market, graduating from the World Bank and becoming a capital-exporting country.

Japan's Samurai bond market is in danger of degenerating into a junk market. The traditional dignity of the Samurai title is being threatened by the influx of dubious issues and speculative instruments into the Tokyo market.

Industry's loss is academia's gain...

ET reports: Universities which until last year lost out to corporates when it came to hiring IITians can now able to get the candidates they wanted. Among the many universities shopping for faculty members is the Alfaisal University in Saudi Arabia. It has landed up at IIT-Bombay, Kanpur, Chennai and Delhi and offered an annual compensation of 1.3 lakh Saudi riyals (approximately Rs 17 lakh), apart from housing and other facilities, to students who will soon complete their master's or PhD. "Several universities from across the globe have invited our students to take up teaching assignments. About 40 to 50 PhD and master's students have taken up such offers,'' said B K Mathur, placement chairman at IIT-Kharagpur.

In contrast to the annual compensation of around Rs 19 lakh that international universities offer, at most IIT campuses an Indian educational institute recruiting students for a teaching position typically offers an annual salary of Rs 7 lakh. Texas A&M University, seeking to recruit for its Qatar campus, is scouting IIT-Madras, as is the Hyderabad-based Indian School of Business, to recruit engineers for research activities. Lt Col (Retd) Jayakumar, deputy registrar (training and placement) at IIT-Madras said that so far, "ICFAI Institute of Science and Technology has recruited 19 students and the two Middle Eastern universities are likely to declare their selection lists soon.'' IIT-Roorkee's placements chairman P K Jain said some private Indian universities like ICFAI and Thapar University, Patiala, were also among campus recruiters. . In fact, soon the IITs themselves will get busy recruiting faculty for the new institutes they are mentoring. Already, IIT-Guwahati has recruited 19 PhD qualified faculty members for the institute it is mentoring, IIT-Patna. Other mentor IITs will soon begin recruiting. None of them, however, will be able to match petro dollar salaries.

Foreign Direct Investment--

Foreign direct investment refers to the investment made by an entity in an enterprise located in a different country. By virtue of making this investment, the investor gains a certain degree of influence or control over the management of the enterprise.FDI can be both outward and inward. In the case of inward FDI, the investor can enter the country by incorporating a company, either by getting into a joint venture with an Indian company or setting up a wholly owned subsidiary. Alternatively, he could retain the status of a foreign company and simply set up a liaison, project or branch office in India.

Benefits:FDI comes with benefits for both the investor and the economy where the investment in made. For the investor, this could be a chance to tap markets where he could make profits. For the economy, FDI has provided a muchneeded push in terms of injecting liquidity apart from bringing in better technology, creating more job opportunities and so on.

Difference between FDI & FII :The most visible difference would be that while FDI includes investment directly into a particular company. Foreign Institutional Investors (FIIs) are known to invest either in the primary or secondary markets, in stocks, mutual funds or via instruments such as participatory notes, dated government securities , commercial papers etcetera. There is also a greater perception of stability that is associated with FDI. In periods of market instability , FIIs are known to beat a hasty retreat leaving the market in a lurch.

Source:ET

India's Top 5 Accounting Scandals--

Recently we all have been hearing about the Satyam Scandal and its impact on the image of Indian IT industry.Here below are the India's top 5 Accounting Scnadals that have shocked the Indian market.

1. CRB Capital Markets Limited (1996) ,Amount-Rs 1200 crore

Fraud: Chairman Chain Roop Bhansali, was accused of siphoning off Rs 12 billion in the CRB scam. CRB was accused of using its SBI accounts to siphon off bank funds, claiming it was encashing interest warrants and refund warrants.

2.ITC – Chitalia's Fera Violation(1996) Amount - $80 million.

Fraud: In June 1996, ED started FERA investigation into the export transactions between ITC and the Chitalia group of companies (EST Fibres) during 1990- 1995.

3.Home Trade (2002) Amount - Rs 6000 cr

Fraud: Eight co-operative banks, like Valsad People's Co-operative Bank and Navsari Co-operative Bank from South Gujarat, collectively lost over Rs 80 crore due to bad investments by the Home Trade. It was also linked to Rs 82 lakh forgery in a central government undertaking EPF scheme.

4.DSQ Software (2003) Amount - Rs.595 crore

Fraud: Dinesh Dalmia's Company DSQ Software was accused of dubious acquisitions and biased allotments made in the year 2000 & 2001.

5.Nagarjuna Finance (2003) Amount : Rs 98.37 crore

Fraud: Executives of Nagarjuna Finance, an promoted by KS Raju, was accused of failure to return about Rs 100 crore to depositors in 1997-98.

Young men are worst spenders,not women--

It's always thought that the female shoppers were the ones who doled out money on the latest fashion and trends.Well, then to tell you it is certainly not correct, for it’s the guys who are the worst spenders, says a survey. Debt collection company, Dun & Bradstreet, has revealed that young men are increasingly finding themselves in trouble with debt.According to its survey, which looked at the latest September quarter debt statistics, disclosed that males in particular are getting under huge piles of debt.(Source: ET)

It has also been found that over fifty per cent of all debtors were under 34 years of age. To avoid an increase in over-indebtedness in the New Year, it is absolutely critical that consumers must pay close attention to their finances.

Standing at over 1300 dollars, the company observed that the average debt value for men was 28 per cent higher than their female counterparts.The study also revealed that men decreased their average debt by 1.2 per cent, which was still small compared with women who cut their average debt size by more than three times that level, or 3.8 per cent.

Inflation slides to 5.91%--

Inflation fell for the ninth consecutive week on Friday to a 10-month low of 5.91% for the week ended December 27, owing to cheaper food and manufactured items. It stood at 3.83% a year ago. The index of food articles group declined by 0.7% as prices of jowar fell by 5%, fruits and vegetables by 3%, eggs and bajra by 1% each. In case of manufactured goods, imported edible oil became cheaper by 1%, polyester fibre by 2% and newsprint by 1%. The index of fuel remained unchanged and also there was no movement in the prices of cement and iron and steel during the week. The inflation has been declining after it touched a peak of 12.91 per cent in August last year.(Sorce:TOI)

RBI was compelled to raise the repo rate to a seven-year high of 9 per cent. The RBI now expects the inflation rate to be significantly lower than its March-end target of 7 per cent, while most analysts expect it to be close to 2 per cent. The wholesale price index is more closely watched than the consumer price index, which is published monthly, because it covers a higher number of products and is released weekly.

Satyam Accounting Scandal a big blot on Indian IT industry--

An accounting fraud was the last thing investors in India would have imagined as a trigger for a reversal in investor sentiment. The Satyam accounting fiasco has come at a time when the sentiment is already brittle and is likely to affect the image of Indian companies among foreign portfolio investors. The accounting scandal that caused Satyam Computer Services Ltd. to collapse is shaking investor confidence in Indian stocks, putting an end to the market’s best start since 2000. This unfortunate development will be a short-term negative for market sentiment. The country's fourth largest IT company - after TCS, Infosys and Wipro - was for several years cooking its books by inflating revenues and profits, thus boosting its cash and bank balances; showing interest income where none existed; understating liability; and overstating debtors' position.

India’s Sensex index tumbled 7.3 percent (on Wednesday), led by a 78 percent plunge in Satyam. Satyam American depositary receipts fell $8.42, or 90 percent, to 93 cents before the opening of the New York Stock Exchange, which then halted trading in the stock.

The Satyam scandal is spurring concern that India’s corporate governance is inadequate days before the earnings reporting season starts. What is SEBI for if it can't monitor business entities? Worries of thousands of employees and investors who have been left in crisis needs to be redressed immediately. The resignation of Satyam chairman Ramalinga Raju after confessing to have forged and inflated the company's accounts for years has sparked fears among the Indian IT firms. This is shocking, painful and a good warning for other companies in the sector.