SUUTI money belongs to UTI investors and not to the government

unit_trust_of_indiaVivek Kaul 
The Specified Undertaking of Unit Trust of India (SUUTI) has appointed three merchant bankers for the sale of 23.58% stake that it holds in Axis Bank, the third largest private sector bank in the country. As of January 21, 2014, the value of this stake works out to around Rs 13,157 crore. This sale will help the government control its burgeoning fiscal deficit. Fiscal deficit is the difference between what a government earns and what it spends.
But the question is does this money really belong to the government? In order to answer this question we need to go back more than ten years and understand why SUUTI was formed in the first place. By 2001, several assured return schemes as well as Unit Scheme-64 (US-64) of the Unit Trust of India (UTI), were in a mess. The government had to come to the rescue of the investors.
In the wake of the crisis, UTI assured unit holders having 5,000
 or less units that their units would be redeemed any timebetween 1 August 2001 and 31 May 2003. The incentive to hold on was the promise of Rs 12 for every unit worth Rs 10, if it wasredeemed in May 2003. The assets of UTI were divided into UTI-I and UTI-II. The government took responsibility for UTI-I, to which US-64 and all theassured return schemes of UTI were transferred. UTI-I came to be known as SUUTI and UTI-II became UTI Mutual Fund.
SUUTI continued to repurchase units of US-64 even after May 2003. The first 5000 units were bought back at the rate of Rs 12per unit and the remaining at the rate of Rs 10 per unit. Alternatively, investors were offered 6.75% tax-free US-64 bonds maturing in five years, in lieu of their investments.
Of course, the investments that had been made by the assured returns schemes as well as US-64 were transferred to SUUTI. These investments included stocks like Axis Bank (or what was then known as UTI Bank), L&T and ITC.
Now given that the government rescued the investors in the scheme, shouldn’t it be cashing on the shares owned by SUUTI? The argument is not as straight-forward as that. A lot of investors who invested in UTI were essentially retail investors. They parked their hard earned money into the scheme on the understanding that UTI was a government undertaking.
The government, instead of managing the scheme well turned it into a Ponzi scheme. Take the case of US-64, the flagship scheme of UTI. US-64 was launched on July 1, 1964. It was designed to be a balanced fund sort of scheme, which invested both in shares as well as debt securities. But things started to change from 1993, once the government started disinvesting its stakes in public sector enterprises. These shares were offloaded by the government on to UTI and other government owned financial institutions.
In June 1987, debt securities formed nearly 64% of the corpus of the scheme. By June 2000, this had dropped to 26%. Hence, US-64 became an equity scheme from being a balanced scheme. Interestingly, a lot of the investment in equity went into shady companies. US-64 also accumulated a 
lot of investments in the so called K-10 stocks, which were being rigged by Ketan Parekh.
Other than making bad investments, US-64 was also paying dividends way beyond what it could afford. In its first year of operation US-64 had paid a divided of 6.1%. It gradually rose to around 10% by 1979-1980. By 1990-1991 this had gone up to 19.5%. This reached 26% in 1992-93, staying there for the next few years.
With the dividend payouts going up dramatically, the income of the scheme also needed to continually keep going up, in order to ensure that UTI could continue maintaing such high dividend levels. UTI had built up very high reserves as it retained a certain percentage of its income and did not give out its entire income left after accounting for expenses as dividend to the unit holders every year.
So UTI dipped into its reserves to continue paying a dividend of 26%, till 1995-1996 because it did not want to lower its dividends. Over the years the dividends paid out were larger than the income of the unit trust. It made up for the difference by dipping into its reserves. But it soon ran out of reserves as well. The next thing it did was that it started to use the money that the new investors brought into US-64 to pay the dividends.
US-64 thus degenerated into a Ponzi scheme, where money being brought in by the new investors was being used to pay off the older investors. On September 30, 1998, a shocked investing public came to know that the reserves of US-64 had turned negative by Rs 1098 crore. On 28
th February 2001, UTI managed funds amounting to Rs.64,250 crore or more than 13% of themarket capitalization of the Bombay Stock Exchange. It was around this time that some serious bungling seemed to have taken place. UTI accumulated substantial holdings in what came to be known as the K-10 stocks. These were companies in whichleading stockbroker Ketan Parekh had made big investments. While Parekh withdrew from these stocks, UTI continued to holdonto them. In a private placement exercise, UTI picked up 3.45 lakh shares of Cyberspace Infosys at a price of Rs 930 when themarket price was Rs 1100. The price of the stock later fell to Rs.11.
UTI also accumulated significant stakes in unlisted entertainment and media companies, acquired at prices between Rs 250 andRs 500 per share. This again seemed to be an attempt to mirror Ketan Parekh’s strategy. After moving out of K-10 stocks, Parekhtook a fancy for the stocks of unlisted media and entertainment companies. Most of these companies put their Initial Public Offer(IPO) plans on hold, blocking UTI’s exit route.
This was the final nail in the coffin of US-64 and UTI, and the government had to come to its rescue. 
As Dhirendra Kumar writes in a column on “The government supposedly mounted this rescue and gave the poor investors something. However, the fact that the investors lost out was not their fault. These weren’t people who invested in some shady Ponzi scheme. They trusted the Government of India and invested in that magnificent institution called the Unit Trust of India. Effectively, the government ran UTI to the ground, bought back the assets of its victims for a pittance by offering them a Hobson’s choice, and is now ready to make a killing by selling off those assets when the equity markets are much higher.”
Given this, the profits that the government is now likely to make by getting SUUTI to sell the stake that it holds in Axis Bank, actually belongs to the investors of the assured return schemes and US-64 of UTI.

The article originally appeared on on January 22, 2014
(Vivek Kaul is a writer. He tweets @kaul_vivek)

Why Chidambaram should not be overconfident about India’s economy

In the recent past, politicians belonging to the Congress led United Progressive Alliance have often remarked that India will be back to a high economic growth path over the next few years. The latest such comment came from finance minister P Chidambaram on January 16, 2014. As Chidambaram said “As global economy recovers and as new measures take effect, I am confident that Indian economy will also get back step by step to the high growth path in three years.”
This confidence seems to suggest that high economic growth in India is a given and come what may it will come back. But history suggests that is clearly not the case. Economic growth can never be taken for granted.
The Global Emerging Markets Equity Team of Morgan Stanley in report titled 
Tales from the Emerging World dated January 14, 2014, points out “In a recent paper, former [American] Treasury Secretary Lawrence Summers warns that of all the factors that drive economic growth the one with the most clearly proven predictive power is simple regression to the mean.” Regression to the mean is a technical term which essentially means that a variable that is highly distinct from the norm tends to return to “normal”. Summers has co-authored the paper titled Asiaphoria Meet Regression to the Mean with Lant Pritchett.
In simple English what Pritchett and Summers are saying is that high economic growth rates tend to revert to their long term averages. As they write “Episodes of super-rapid growth tend to be of short duration and end in decelerations back to the world average growth rate. Both China and India are already in the midst of episodes that are historically long and fast.”
Hence, high economic growth rates can never be taken for granted. “The growth rate, even in successful economies, will tend to revert to the long-term average for all economies (which is about 1.5 to 2 percent). Summers[along with Pritchett] analyzed all 28 nations that, since 1950, have experienced periods of “super rapid growth” of more than 6 percent a year. These booms tend to be “extremely short lived,” with a median duration of nine years, and “nearly always” end in a significant deceleration, with a median deceleration of 4.65 percentage points to an annual GDP growth rate of just 2.1 percent, or “near complete regression to the mean.” In short, the nations catching up most rapidly now are increasingly less likely to continue catching up in the future,” the Morgan Stanley authors point out.
As mentioned, periods of high economic growth rates last for a median period of 9 years. The research paper considers data up to 2011. And by that time, 
the economic growth in India had lasted for a period of around 8 years. In China, it had lasted 32 years.
While Indian politicians might like to think that it is just a matter of time before economic growth comes back, that may not be the case. As Pritchett and Summers write “The single most robust and striking fact about cross-national growth rates is regression to the mean. There is very little persistence in country growth rates over time and hence current growth has very little predictive power for future growth.” Given this, just because the Indian economy has grown at a high growth rate between 2004 and 2011, that does not mean that it will continue to do so in the future as well.
Pritchett and Summers do not get around to explaining the major reasons behind why this happens (the research paper is still work in process). But one of the reasons they point out is the rule of law. As they write “we suspect that the reason for slowdown that will come in China and India is for a similar reason but which will manifest differently given the very different politics. That is, in neither country does investor confidence rely on rule of law.”
But there is other research which points out why poor countries are not able to sustain high economic growth beyond a point. As the Morgan Stanley authors point out “New research, however, shows that “development traps” can knock countries off the catch-up path at any income level. The challenges of developing industry — backed by better banks, schools, regulators, etc. — do not accumulate and confront an economy all at once. They continue to harass an aspiring nation every step up the development ladder.” This is already playing out in India.
In fact, countries flatter to deceive, do well in one decade and don’t do well in the next. “In some cases, development traps can drag newly rich countries back to the middle income ranks, as has happened in the last century to Argentina and Venezuela. Since the late 1950s, many nations have also slid back from the middle to the lower income class, including the Philippines in the 1950s, and Russia, South Africa and Iran in the 1980s and 90s. On average, more nations regress to a lower income level than advance to a higher one. And every decade tosses up new convergence stars — from Iraq in the 1950s to Iran in the 60s and Malta in the 70s — that burn out in the next decade,” Morgan Stanley authors point out.
Hence, sustained economic growth is a very rare phenomenon. And just because India has grown at a fast economic growth rate in the past, it may not do so in the future. The highly optimistic UPA politicians need to start by at least appreciating this point. 

The article originally appeared on on January 21, 2014 
(Vivek Kaul is a writer. He tweets @kaul_vivek) 

If Rahul is serious about corruption, then let law of the land investigate Vadra

rahul gandhi

Vivek Kaul
Some of the political pundits who operate between Gurgaon in Haryana on one side and Noida in Uttar Pradesh, on the other, have been very impressed with Rahul Gandhi’s big speech, which he made late last week.
But there are several reasons which clearly point out that Rahul’s big speech should be treated like just another speech and nothing more.
In his speech Rahul Gandhi talked about giving “the country anti-graft bills which will transform the country,” and which will lead to “punish[ing] the corrupt and protect[ing] the honest.” A very noble thought indeed.
But look at the way the Congress party government in Haryana is treating the IAS officer Ashok Khemka. 
The government has recommended a CBI probe against Khemka for awarding a contract worth Rs 8 crore to a Gujarat based company. Over and above this, news reports suggest that a second chargesheet will be filed against Khemka, by the Haryana government. Khema has been accused of incurring a loss of Rs 22 lakh to the Haryana Seed Development Corporation of which he was the managing director between October 15, 2012 and April 4, 2013. Yes, you read the right. A loss of Rs 22 lakh.
As is well known by now Khemka exposed how the Haryana government went out of its way to help Rahul’s brother-in-law, Robert Vadra, to acquire land at cheap rates. Vadra later sold the land to DLF to make massive profits. (You can read a 
detailed analysis on this here).
So does this mean that Rahul’s statement of “punish[ing] the corrupt and protect[ing] the honest,” applies to everyone else other than the Gandhi family? And those who dare to expose the shenanigans of the family, will be hounded like Khemka has been?
As Pratab Bhanu Mehta writes in The Indian Express “Gandhi’s fiery AICC speech also vested too much in speeches and less in action. An anti-corruption stance is not very convincing when your own government is hounding Ashok Khemka and blaming the CAG and CVC.”
Also, why has Rahul suddenly woken up to corruption, a few months before the next Lok Sabha elections are due? Where was he when the Commonwealth Games scam, the 2G scam and the Coalgate scam happened? Holidaying in Europe?
Further, what does Rahul have to say 
about the CBI plea to drop criminal prosecution against Ashok Chavan, the former chief minister of Maharashtra, in the Adarsh Housing Society scam? That CBI is an independent organisation, which operates on its own? A special court in Mumbai rejected this plea.
Or what does he have to say about the Maharasthra government first rejecting the report by the judicial commission on Adarsh Housing Scam and then only partially accepting it. The Judicial Commission’s report pointed out that the Adarsh Society enjoyed political patronage of former chief ministers, the late Vilasrao Deshmukh, Sushil Kumar Shinde (the current home minister of India) and Ashok Chavan.
As pointed out earlier, the Maharashtra government accepted the report in parts. While it accepted allegations against Ashok Chavan, it decided to give a clean chit to the late Vilasrao Deshmukh and the current home minister Sushil Kumar Shinde.
Rahul also talked about “people demand[ing] honest and efficient governance,” and the Congress party “respond[ed] by getting the Lokpal Act passed.” The Lokpal Act in its current form has been doing the rounds for the last few years. Can Rahul tell us why did it take the Congress party so long to get it passed? Are the recent election results, where the party suffered an electoral humiliation, the main reason for it?
Rahul also took potshots at his main rival Narendra Modi of the Bhartiya Janta Party and said “Democracy is not rule by dictate. It is not rule by one man. It is rule through empowered elected representatives.” Very good point indeed.
But if Rahul is so concerned about democracy then when was the last time the Congress party had elections for the post of the President and Vice President?
As Ashutosh Varshney writes in 
Battles Half Won – India’s Improbable Democracy “An interconnected problem is the lack of intra-party democracy. Inter-party competition is vigorous, but intra-party competition is not. Party officials are appointed by the leaders, not elected by party members. During 1920-1973, the Congress party used to have regular elections, a practice dropped since then.” A Gandhi family scion who has inherited the throne should be the last person talking about democracy.
All these reasons make it very clear that Rahul Gandhi and the Congress party being very serious about corruption, doesn’t cut much ice. The Gandhi family scion needs to realise that ultimately actions speak louder than words.
As MJ Akbar put it in The Times of India “Corruption is a slippery slope for anyone in power. Congress should have stuck to its familiar narrative of populism and stability, for such advertising can be backed by evidence.” So, if Rahul is serious about corruption, then he should let the law of the land investigate the land dealings of Robert Vadra for a start and ensure that the Congress governments do not hound honest bureaucrats like Ashok Khemka. Then there will be real evidence to back his words. Of course, that is easier said than done.
(Vivek Kaul is an author. He tweets @kaul_vivek) 

What Rahul baba learnt from Dedh Ishqiya before his big speech

rahul gandhiVivek Kaul 

Rahul baba was getting ready to make the big speech.
Along with his mother and a speech writer, an executive from the recently hired advertising agency to spruce up his image, was also present in the war room.
“I am so proud of you beta,” said the mother. “You are finally behaving like a grown up. Taking the bull by its horns.”
“Bull?” asked Rahul. “I thought we called him the feku.
Feku is the old term for him sir,” said the executive from the advertising agency. “These days we are calling him the chaiwallah in all our internal communication.”
“Yeah, how does an upstart like him, a chaiwallah‘s son, dare to challenge you Rahul baba,” said the speech writer, who was an old family hand. “India’s next leader has to be you. In fact, we should ask feku to run a tea stall at our conclave.”
“Okay, okay, that is enough,” replied a slightly irritated Rahul. “Have you got the speech ready?”
“Yes sir,” said the speech writer, handing over a few sheets to Rahul.
Rahul went through the pages very quickly and had a slightly miffed look on his face.
Arre this is the same speech I made last month!” exclaimed Rahul.
“No sir. This is a totally new speech. I just wrote this just today morning,” replied the speech writer. “I stopped copy pasting after what happened to Shah Rukh Khan.”
“But then why does it read the same?”
“What to do,” said the speech writer. “All speeches written for Congress leaders sound the same since the 1960s. It’s all about roti, kapda aur makan. How many different speeches can one write on the same theme?”
“Oh that’s fine,” interjected the advertising executive. “You can fool some of the people all the time. Also, these kind of speeches go well with the brand positioning of the Congress. But we need to add some points about the economic growth to it as well.”
“Economic growth?” asked the speech writer. “
“Yes. Now its about roti, kapda, makan aur economic growth.”
Arre par what happened to garibi hatao then?” asked the confused speech writer.
“Oh, we have removed garibi already through our flagship schemes like food security and NREGA,” said Rahul.
“When did that happen?” wondered the speech writer. “What will I do now?”
“Shutup,” said Rahul. “So Ma when do I get to make this speech?”
“Oh, right at the end of the conclave.”
“At the end?” asked Rahul. “Why Ma?
“You are the show stopper beta.”
“I don’t like this. It sounds like the Hindi films of the sixties and the seventies, wherein the actor Pran’s name used to come right at the end of the casting. It always used to be And Pran.”
So?” asked the perplexed mother.
“I am not a villain Ma.
“No no beta. You are the show stopper like in the fashion shows. The biggest star always comes at the end. You are the hero. With your speech being scheduled right at the end the workers will wait to listen to you and that way we will have a stadium full of people. Other leaders can also have an audience while they speak.”
“No Ma. Sheila aunty got me to speak right at the end and people started to leave as soon as I started to speak.”
“Oh that was the general public Sir,” the advertising executive interrupted. “These are members of your party. Rest assured they won’t leave. And I will ensure that the doors are locked from the outside till your speech is over.”
Haan that sounds like a plan,” said Rahul. “Good we hired you guys.”
“Always at your service sir,” replied the advertising executive.
“You know I was thinking of using some Urdu poetry that I have been reading lately,” said Rahul. “Ah, like mauni baba,” said the speech writer.
“So how is this?”
Wah Wah,” said the advertising executive.
Arre first let me complete the couplet,” said Rahul.
“Oh, but what is that we have to say when someone starts reciting a couplet?” asked the advertising executive, who happened to be a Bengali.
Irshad, irshad, Rahul baba,” the speech writer chipped in.
Ke arz kiya hai,” started Rahul.
Bolo beta,” said the mother.
Galat bazar ki janib chale aaye hain hum shayad,
chalo Sansad main chalte hain wahan bhi sale lagti hai.
Koi bhi androoni gandagi bahar nahi hoti,
humme to is hukumat ki bhi kidney fail lagti hai.”

(janib = towards. Sansad = Parliament. androoni = inside. Gandagi = dirt. hukumat = rule)
Wah wah beta,” said the excited mother. “I didn’t know there was a poet inside you.”
“Oh, I didn’t write it Ma. This is by a poet called Munnawar Rana,” replied Rahul.
“Sir, there two problems with this couplet,” said the advertising executive.
“Two?” asked Rahul.
“Actually three. As a politician when you quote an Urdu couplet it has to be from Ghalib because he is the only Urdu poet we Indians have heard of.
“You are going against your own government with this couplet.”
“That I do all the time. Mauni baba does not mind. And that’s my style”
“Yes. But that is not correct. The party and the government should be seen to be saying the same things,” explained the advertising executive. “This is a fundamental rule of communication.”
“And what is the third thing?”
“Oh, Dedh Ishqiya, a fantastic film which was high on Urdu, did not do as well as it was expected to.”
“So?” asked Rahul.
“I think you should stick to English and Hindi.”
“Hmmm,” said Rahul. “I so wanted to speak some Urdu. People sound so intelligent when they speak in Urdu.”
“What else have you thought of?” asked the speech writer.
“You know I have been reading this management book Fen Zu and the Art of War. And inspired by that I have written something.”
“I am so proud of you beta,” said the beaming mother.
“We will go into this battle as warriors with our heads held high. We will not look back. We will go into this battle knowing who we are and what we stand for. We will fight with all that we have within us. We will not rest. We will not lose courage. And we will not stop till the battle is won,” said Rahul.
“Now that sounds like a speech,” said the advertising executive. “Absolutely kick-ass. You are The Last Action Hero.”
“And I will have to look for a job,” said the speech writer.
“Now only if you had got me a bahu (daughter-in-law),” said the mother.
And Rahul wondered “Agar Joker chala gaya to Batman kya karega? (If the Joker goes away what will Batman do?)”

(Vivek Kaul is a writer. He tweets @kaul_vivek)
The article originally appeared in January 18, 2014
Disclosure: The last line of the piece, “Agar Joker chala gaya to Batman kya karega!,” has been borrowed from a similar line from the recently released Dedh Ishqiya 

How deflation can spoil the global stock market rally

stock-chart Vivek Kaul  
There are stock market rallies that are currently on across various parts of the world. The stock market rally in the United States is now nearly 5 years old, having started in March 2009. But there is a small factor that investors who are driving up these markets are not taking into account. And that is the current low inflation scenario as well as the prospect of deflation.
As Gavyn Davies writes in The Financial Times “The vast majority of developed countries are currently reporting a headline inflation rate of below 1.5 per cent, with the trend in virtually all of them headed downward.”
Inflation in the Euro area (17 countries in Europe which use the euro as their currency) for the month of December 2013 stood at 0.8%. In December 2012 it had stood at 2.2%. The inflation in the European Union (which includes the euro area countries plus 11 more European countries) was at 1% in December 2013. It was at 2.3% in December 2012.
A similar trend seems to be playing out in the United States. For the month of November 2013, the consumer prices, as measured by the personal consumption expenditures deflator, rose by 0.9%. 
This number was at 1.7% in November 2012. The personal consumption expenditures deflator is a measure of inflation favoured by the Federal Reserve of United States, the American central bank. The Federal Reserve has an inflation target of 2%. Hence, to that extent consumer prices in the United States are rising at a much slower pace than the target favoured by the Federal Reserve.
As Davies writes “It is hard to remember a period, other than in the months immediately following the financial crash in 2008, when…headline inflation has been so low in so many different economies.”
And why is that a worry? 
Lets look at the European Union inflation data in a little more detail. Countries like Greece, Cyprus, Latvia and Bulgaria are facing deflation. This means that prices in these countries are falling. In other countries like Sweden, Spain, Italy, France and Portugal, the rates of inflation are less than 1%. In fact, in case of Spain and Portugal these rates are close to 0%.
When prices are falling or it looks like that they will soon start falling, consumers tend to postpone their consumption decisions in the hope of getting a better deal in the future. This has an impact on businesses, and, in turn, the economy in general.
When consumers postpone their buying, businesses try to attract them by cutting prices of their products. This means a loss of revenue and a further fall in the rate of inflation. And this might lead to consumers postponing their consumption even further. So the loop works.
Once countries get into what is known as a deflationary spiral, it is very difficult for them to get out. Japan is an excellent example of the same. The country has been trying to come out of a low inflation/deflation kind of scenario for close to two decades now, without much success.
Investors across the world have chosen to ignore this threat which has been lurking around the corner for a while now. As Albert Edwards of Society Generale writes in a research note titled Markets still refuse to price in deflation threat….. for now dated January 15, 2014, “Investors have yet to react to the deflationary threat however. They do not seem to care that they are sitting on the edge of a cliff. Markets remain stoic about the risks of outright deflation in the US and eurozone for one very simple reason – they simply do not believe a recession that would trigger outright deflation is on the horizon. Quite the reverse – they believe with all their heart that we are at the start of a self-sustained recovery. That is despite the fact that the US recovery is already noticeably longer than average, and that the classic signs of old age, such as rapidly slowing productivity growth and stagnant corporate profits, can clearly be seen.”
A reason for the confidence of the stock market investors is the fact that over the last few years, at the slightest sign of trouble, central banks around the world have printed money (or what they like to call quantitative easing or QE) to keep interest rates low. This has allowed investors to borrow at rock bottom interest rates and invest in financial markets throughout the world. And that will keep the stock market rallies going. As Edwards puts it “Because the market has firmly got it into its head that QE will 
always be good news for equities. So if the economy swoons, equities will look through any short-term disappointment as more QE will save the day. Investors see bad economic news as good news for equities.”
Hence, investors expect central banks to print more money once they start feeling that deflation is a serious threat to their economies. And the logic is that a lot of this money fill find its way into the stock market and drive prices higher. But there is a problem with this logic.
Until 2012, every time central banks cranked up the printing press, prices of commodities like gold rallied. But that hasn’t happened in the recent past, even though central banks continue to print money. Hence, the proposition that central banks printing money will lead to stock markets rallying, may not always hold true.
As Edwards puts it “I do believe this to be utter nonsense. For in the same way as investors believe, axiomatically that QE will drive up equity prices, they believed exactly the same thing of commodities until 2012. Commodities are a risk asset and benefited massively from QE1 and QE2, so why has QE3 had absolutely no effect on commodity prices? Exactly the same thing could happen to equities if a recession unfolds and profits plunge at the same time as the printing presses are running full pelt. Do not assume equities MUST benefit from QE.”
And this can really spoil the global stock market party. I had asked the well respected financial historian Russell Napier, who works for CLSA,
 in an October 2012 interview I did for the Daily News and Analysis, that by what level does he see the stock markets falling in the coming deflationary shock. And he had replied “I will just go back to my book Anatomy of the Bear, which was published in 2005 and in the book I forecasted that the equity market, the S&P 500 (an American stock market index constructed from the stock prices of the top 500 publicly traded companies) will fall to 400 points [On Thursday, January 16, 2014, the S&P 500 closed at 1,845.89]. As you know, in March 2009 it got to 666 points. It got somewhere there but it did not get to 400. So I am happy to stick with the number of 400.”
And once the S&P 500 starts to crash, the rest of the world will follow. Of course, till that happens, there is money to be made.
The article originally appeared on on January 17, 2014 

(Vivek Kaul is a writer. He tweets @kaul_vivek)