My Page May 2012 Gold, spirituality etc


Mailed with May 2012 issue of

M G Warrier’s MY PAGE

CONTENTS:A. Finance: i) Gold management needs a makeover (Warrier’s article in the Hindu Business Line, April 13, 2012)ii) Interest rates on small savings schemes, 2012-13 B. Spirituality: Quotes from Shankaracharya and some comments

C. Health-Managing cholesterol-Some tips

Gold management needs a makeover

M G Warrier

…from ornamental to tradable gold.

The management of gold reserves has been a subject of intense debate and controversy. The Budget 2012-13 has proposed a doubling of customs duty, while the Reserve Bank has expressed its concern about rising imports of gold and other precious metals.

In March 2011, the World Gold Council identified India as a key driver of global gold demand. It made the following observations:

At more than 18,000 tonnes, Indian households hold the largest stock of gold in the world.

Gold purchases in India accounted for 32 per cent of the global total in 2010.

The vast majority of the Indian population (70 per cent) lives in villages, which have traditionally formed the source of more than two-thirds of Indian gold demand.


The WGC research shows that by 2020 cumulative annual demand for gold in India will increase from the present level of 1,000 tonnes to more than 1,200 tonnes, or approximately Rs. 2.5 trillion, at 2011 price levels. Gold is a key factor in forex reserves management and assets of financial institutions. It is held in the form of jewellery, bullion, gold bars or coins by institutions and individuals and so on. The quantity of gold with religious institutions and households in India has never been assessed.

According to one estimate, of the world's exploited stock of 140,000 tonnes of gold, WGC has estimated holdings of gold by Indian households at more than 18,000 tonnes. About 600 tonnes are held with RBI and an unestimated quantity is held by temples and religious institutions.

The Government and RBI decided rather late, or in the last quarter of 2009, to increase the gold component in the country's forex reserves by about 200 tonnes (valued at over Rs 30,000 crore) by way of a purchase from the International Monetary Fund.


While the overall stock position and central bank's holding of gold are not that impressive, our country imports around 800 tonnes of gold annually, which is no mean quantity. The deployment of this precious metal to the advantage of the nation makes for a sorry story.

Gold should be restored its status as a store of value by making it tradable, secure and available in ‘paper' form, against actual stocks of pure and standard gold.

It is high time gold is accorded the position it deserves in forex reserves management. The Centre could also consider an arrangement, through RBI or any other duly constituted authority, to trade in ‘paper gold', against genuine tradable gold stocks. Mutual Fund ETFs are no substitute for this.

In India gold is popular for all wrong reasons. The fascination for this yellow metal as an ornament and as dowry has led to a reluctance among people to talk about gold in public.

From the retail investors' point of view, unfortunately, Gold Exchange Traded Funds (ETFs) are yet to become popular and really tradable. Therefore, the common man is tempted to invest in ornament gold, which has several negatives such as difficulty in ensuring purity, making charges, security-related issues and inadequate liquidity.

The infamous money-lender takes advantage of the helplessness of the common man by luring him with loans against jewellery at high rates of interest. He would offer unimaginably high amounts of loan against each 10 gram of gold, with the ultimate motive of robbing the owner (the pledged gold is sold or forfeited by the money-lender as the loan plus interest grows much beyond the real value of gold pledged in less than a year). This trend, hopefully, has been reversed with the recent RBI directive to follow prudential norms in regard to the loan-to-value ratio.


The time is ripe for authorities to think in terms of dedicated professional institutions at the regional/state level, which will handle gold from a banking angle. An apex body should be equipped with linkages for import and export of gold and gold products with borrowing and lending capabilities.

States like Kerala have successfully intervened in other similar sectors like chits/kuris and lotteries, which were also areas of exploitation by vested interests. Private players had to fall in line and function with discipline and self-regulation.

Establishment of ‘Gold Corporations' with state participation could also be debated. Such an institution can act as a depository where the gold possession of individuals now in bank lockers and the pledged gold can find a safe shelter, provided the purity can be ensured, and the ‘Corporation' can find the resources and skill to deal in gold and retain the customers' confidence.

(The author is former General Manager, RBI.)

(This article was published on April 12, 2012)


The author has mentioned that the recent guidelines issued by the RBI

with respect to Loan to Value (LTV) of Gold Loans would ‘hopefully’

help reverse the trend of usurious moneylenders exploiting the

“helpless common man”. I would like to point out two things. Firstly,

the RBI guideline that was brought out is applicable only to NBFCs.

This does not apply to the thousands of unorganized moneylenders, who

have opaque policies and practices. The Gold Loan NBFCs had spent

decades trying to move into the space that was the monopoly of

moneylenders, by bringing about scalability, accountability and

transparency. Unfortunately, the regulator lacked the foresight to see

that the progress made by NBFCs with respect to shifting the gold loan

borrowers from the moneylender would be completely reversed by issuing

such a diktat against the NBFCs.

from: Kamal Subramaniam

Posted on: Apr 13, 2012 at 15:41 IST

Hence essentially by capping the Loan to Value for NBFCs, the RBI has

made a self-goal since moneylenders is an unregulated form of credit, as

opposed to NBFCs which fall under the purview of the RBI. NBFCs have

always been a key ‘complementary’ link within the Indian Banking

universe. They play a crucial role in last mile connectivity, and are

able to streamline their operations by focusing on one or two core

products. Sadly with the above mentioned guideline, RBI has clearly

shown its step motherly treatment towards NBFCs.

from: Kamal Subramaniam

Posted on: Apr 13, 2012 at 15:42 IST

Posted on: Apr 13, 2012 at 15:42 IST

I have no quarrel with the point made by Kamal Subramaniam. There are NBFCs who follow prudential norms in letter and spirit. There were benevolent money lenders too. But what to do with NBFCs who lure borrowers offering 100 per cent Loan-to-Value ratio? How do they recover the loans? And, it is another matter that NBFCs are not targeting small borrowers who depend on village money lenders. I stay in GOLD's own country(Kerala) and find Ads in newspapers everyday promising help to retrieve pledged gold and sell!


Posted on: Apr 18, 2012 at 09:17 IST

Interest rates on small savings:

This information may be of interest to you:

The Govt has hiked int rates on small savings as below:for 2012-2013 Fiscal. Rates in brackets for earlier yr

1. Public provident fund- 8.8%(8.6%) -office Monthly income schme(MIS)--8.5%(8.2%) term deposits

1yr- 8.2% 2Yr- 8.3% an increase of 0.50%

3Yr-8.4% (8%) 5yr-8.5%(8.3%)

4. Five year recurring deposits offer 8.4% (8.3%)

5.senior citizen savings scheme- 9.3% (9%)

6.National savings certificate

5yr maturity - 8.6%, 10 yr maturity-8.9% up by 0.2%

6. post office savings deposit remains @ 4%

@@ RBI notification.


The RBI has asked not to insist on attestation of signatures of persons wanting to invest

their funds in fixed Deposits.or opening a bank locker.However , attestation by two witnesses would be needed for persons using thumb impression for these services

##cheques valid for 3 months


From 1st April, all cheques and bank drafts are valid only for 3months from the date of

issue, a development that the RBI thought will help mitigate frauds related to such instruments. Govt,through the central economic intelligence bureau had

, brought to RBI'S notice that some persons were taking undue advantage of 6 months validity of cheques,drafts, pay orders,banker's cheques by circulating them like cash for this period.

N.B If the above information has already been furnished elsewhere may be deleted.

K.P.SASTRY M-151, Exrbites mailed this info to me : )


Japo jalpah silpam sakalam api mudraa-virachanaa

Gatih praadakshinyakramanam asanaadyahuti-vidhih;

Pranaamah samvesah sukham akhilam atmarpana-drisaa

Saparyaa-paryaayas tava bhavatu yan me vilasitam.

(Shankaracharya’s Soundaryalahari, Verse 27)


May everything that I do with the sense of self-dedication(Aatmarpana-drisa) be items in Thy service-my prattle, the utterance of Thy Mantra; the movements of my hand, the gestures and poses of Thy worship; my walking, Thy circumambulation; my eating, fire-sacrifice to Thee; the stretching of the body in sleep and rest, prostration to Thee; and all my enjoyments, offerings made to Thee.

Whatever action it is of mine, may be taken (as intended) for Thy worship: (my) prattle, as muttering (Thy) prayer; the manifold forms of my manual work, as the Mudras (gestures) employed in (Thy) worship; (my) loitering, as going around (Thee) clockwise; my taking nourishment, as offering oblations (to Thee); and (my) attending to all other comforts as dedicated my entire self (to Thee)

This reminds of a poem in Hindi' Bhikharin'

The meaning of the poem would run thus.

" He Bhagwan, so many pe ople come to your temple clad in silk wearing rich ornaments. They come in palanquins followed by servants.

They bring with them garlands made of fragrant flowers. They do poojas with dhoop and dheep and worship you with stotras and mantras and offer nivedanam of sweets and fruits.

As for myself I am a beggar. I have only rags and my entire body is smeared with stinking mud.I have neither dhoop or dheep,I don't know even to speak well. How can I recite mantras?

I have a few pieces of rags which have to be treated as silk cloth. Treat my inconsistent words as prayers.I am having a begging bowl which I constantly hit with a stick to let others know of my arrival. Hey Bhagvan,you treat the sound of the stick as the ringing of the bell.A few pieces of roti I received from some sympathetic souls are being offered to you as nivedan for being eaten up by me as Prasad.

If you are not satisfied with the above, I submit myself, my body ,my act of begging and the little happiness I derive to you whole heartedly. Please accept me as a whole as my offering. I have nothing else to offer, because I am a beggar."

Every stanza would end with the words' main bhikharin hum".

What a great thought of Sharanagati expressed through the words of the beggar!. Though there are are many more works in Sanskrit conveying the significance of TOTAL SURRENDER, the small poem appealed to me very much.

Vathsala Jayaraman


How to Lower Cholesterol Naturally in 7 Steps

Learning how to lower cholesterol naturally is simple. And these 7 steps to lower cholesterol naturally have a much higher rate of success than the "prevention medications" usually prescribed to lower cholesterol.

Actually, you can probably lower cholesterol better by regularly petting your cat than taking cholesterol drugs. And you'll avoid all these side effects.

•Tiredness and irritability,

•Muscle pain and weakness,

•Loss of memory and mental clarity,

•Liver inflammation, damage and abnormalities,

•Depletion of vitally important heart protection nutrients,

•And long term use can even lead to congestive heart failure.

Plus, "prevention medications" used to artificially lower cholesterol (un-naturally) only decrease heart attack death risk by less than 1½%.

How to Lower Cholesterol Naturally

These are the 7 steps you can take to lower cholesterol naturally. And if you follow all of them, you can count on a very high success ratio.

1.Eat a healthy cholesterol lowering diet. Some fats help lower cholesterol, while others can raise it. So get your fats right. Reduce overall fat intake, avoid trans fats, limit saturated fats and replace "bad" fats with "good" fats, such as olive oil and those found in whole grains and omega 3 fish. High fiber foods also help lower cholesterol naturally. They decrease "bad" LDL and increase "good" HDL cholesterol.

2.Do regular healthy physical activity. At least 30 minutes of exercise a day has been shown to decrease total cholesterol and improve "good" HDL cholesterol levels, while lack of regular physical activity can raise "bad" LDL cholesterol levels as well as lead to weight gain.

3.Reach and maintain a healthy weight. Being overweight can decrease "good" HDL levels and increase "bad" LDL and total cholesterol levels. Learn the healthiest weight to aim for by calculating your BMI here.

4.Eliminate sweets and refined foods. Few realize that eating sweets and other high glycemic foods increase triglycerides and cholesterol production. These foods are also addictive. Once you eliminate them, you'll find that fruits, vegetables and whole grains actually taste sweet.

5.Cut out caffeine and alcohol – drink water. Both caffeine and alcohol have been shown to elevate cholesterol. So it's best to switch to pure water and, at the very least, follow the "no more than one a day" rule.

6.Don't smoke or use tobacco in any form. Smoking damages blood vessels, contributes to hardening of the arteries and is a major health risk for heart disease, stroke and other degenerative diseases.

7.Practice good healthy stress management. Just like cholesterol, a certain amount of stress is healthy – such as with exercise. But the link between excess stress and high cholesterol production is well established. So take time to relax, let go, meditate, enjoy yourself or do whatever it takes to keep your stress level under control.

Use the 7 steps to lower cholesterol naturally to reach optimum levels of:

• Triglycerides less than 150 mg/dl.

•Total cholesterol less than 200 mg/dl.

•HDL "good" cholesterol over 40 mg/dl.

•LDL "bad" cholesterol less than 100 mg/dl.

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