BROAD//SHEET
Monday, September 16, 2019
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Live event of the day

We are delighted to announce that we are doing a Facebook Live today with Miss Malini’s Girl Tribe—an amazing community which creates a safe, inclusive space for women to talk, share, support, empower and inspire each other in every way possible. We will be speaking to members of the community about the (mis)representation of women in movies, ads and the media. Come join us to share your opinions, insights and experiences. The time: 2:30 pm today! The virtual venue: Malini’s Girl Tribe. Be sure to join the Facebook group to watch us in action! Find more details on the event on Instagram or Facebook

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EVERYONE'S TALKING ABOUT...

The biggest news story today, explained.

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The massive drone attack on Saudi oil

A well-coordinated drone attack on the world’s largest production centre in Saudi Arabia has dealt a potentially crippling blow to the world’s oil supplies—and it’s especially grim news for Indians. 


What happened? Ten drones targeted the state-owned Aramco oil facilities. The result: The damage has forced Saudis to cut production by 5.7 million barrels per day—that’s 50% of the kingdom's total output and 5% of the world’s oil supply.


Yikes, who did this? Houthi rebels from Yemen have claimed credit. But the US is pointing its finger squarely at Iran. 


Why the Yemenis? In 2014, Houthi rebels began an armed rebellion against Yemeni president Abdrabbuh Mansour Hadi—who was forced to flee the country. Now, the Houthis are Shia Muslims (though they enjoy Sunni support), which in turn sparked worries about Iran getting a foothold in the country. As a result, in 2015, Saudi Arabia and eight other Arab states—backed by the US, UK, and France—began air strikes against the Houthis in order to restore Hadi to power. The war has been dragging on ever since—creating one of the worst humanitarian crises in the world. 


Tell me more: According to the most recent report, the death toll is now approaching 100,000—due to direct targeting of civilian targets by Saudi air strikes. A UN study revealed that the vast majority of the victims are children under five—with one child dying from either the war and its side effects (disease, starvation etc) every 11 minutes and 54 seconds. So you can see why Saudi Arabia might be a target of Yemeni rage. 


And what about Iran? It isn’t clear if Iran is directly involved in these Houthi drone attacks—which have increased in frequency and accuracy—but the rebels are backed by Teheran. Given their range, the drones could have been launched from either Yemen or Iran. That said, Iran has every incentive to disrupt the world’s oil supplies. The US recently pulled out of a nuclear deal and has been pressuring various nations—including India—to stop buying Iranian oil. The aim: to cripple its economy and force Teheran to negotiate a new deal more acceptable to Washington. (We explained the US-Iran conflict here)


How does this affect Indians? A big cut in global oil supplies could potentially hit India at a time when it is most vulnerable. We are one of the biggest importers of oil in the world—and 11% of our supplies used to come from Iran. We’ve just lost that source thanks to US pressure (explained here). And Saudi Arabia is our #2 supplier of crude and cooking gas after Iraq. So any serious disruption—accompanied by escalating oil prices—is a big threat to our economy.


How bad will it get? Now, Saudis are claiming that they can quickly restore normal production levels within a few days—and have enough oil in reserve to make up the shortfall. The US is also promising to release its reserves to steady the markets. Even so, experts estimate, “A small $2–$3 [per barrel] premium would emerge if the damage appears to be an issue that can be resolved quickly, and $10 if the damage to Aramco’s facilities is significant [leading] to prolonged supply outages."


Point to note for India: According to Mint, “Every dollar increase in the price of oil raises the import bill by ₹10,700 crore on an annualized basis. India spent $111.9 billion on oil imports in 2018-19.” So any long term increase in oil prices is bound to hurt everyone’s wallet, including the government’s—and at a time when the economy is already feeling a little fragile. 


Learn more: CNN and Axios report on the likely impact on global oil prices. Hindu Business Line and Mint have more on the impact on India. Al Jazeera reports on heightened fears of a direct US-Iran conflict in the Gulf. Read Broadsheet’s explainer on the escalating confrontation—and its implications for India. BBC explains the war in Yemen.

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IN CASE YOU MISSED IT...

wondering why your mother tongue doesn’t get its own special day

A Hindi-sized row unleashed by Amit Shah: Apparently, Saturday was ‘Hindi Diwas’—yes, our national language gets its own very happy birthday. On this joyous occasion, the Home Minister decided to cause woe by tweeting “it is very important to have a language of the whole country which should become the identity of India globally”—and added that Hindi is the one language that can unite the country. So the rest of non-Hindi India went: Hain? Actually, Tamil Nadu leaders asked “Is it India or Hindia?”; Kerala’s CM called it a “war cry”; and Kannadiga organisations took to the streets in protest. Our fave response was this classic Tamil movie clip. (note to non-Tamil speakers: thatha means grandfather).


A seven football field-sized detention centre: The government is busy building the first detention centre in Assam for everyone who has been declared a foreigner (more on the National Register of Citizens in our explainer here). It spans 2.5 hectares and can accommodate 3,000 detainees. Horrified? Don’t worry. Officials insist these will be “hostel-type rooms, each of which can accommodate four to five detainees. The rooms, the officer said, will have regular doors, proper lighting and ventilation.” Never mind, that a number of construction workers building this centre will likely end up here. In related news: the government now says that there is no such thing as a “final” NRC list. Those lucky ones who made it to the list could be knocked off for a variety of reasons.


Potential bad news for car-poolers: An Economic Times report suggests that the government is gearing up to make your life miserable. Draft guidelines will require both the driver and the passengers submit their KYC to verify their identity—and the number of such rides per vehicle will be limited to four per day. According to an official, “We want to ensure that this does not become a commercial activity”—but also ensure that state governments can make some money off carpooling (?!). What will this affect? Private cars. So carpooling apps like QuickRide and BlaBlaCar—but also private vehicles that operate via Ola and Uber. But worry not: the government has also directed all and sundry to promote “shared mobility” to reduce congestion and pollution. Sooo... (Economic Times)


Mukesh Ambani gets a tax notice: Ambani, his wife Nita and three children have received a notice regarding “undisclosed foreign income and assets.” Back in 2011, a news investigation revealed that there were 1,195 Indians who held undisclosed Swiss bank accounts at HSBC Geneva—and 14 accounts totally $601 million were held by offshore entities were linked to the Reliance Group. The Wire has more details.


World’s oldest mother is in ICU: First, doctors sent Mangayamma to intensive care soon after she gave birth for unspecified reasons related to “stress.” Then her husband joined her after suffering a heart attack. And the obstetrician claims that the couple lied to him about her age—pretending she was a decade younger. (The Sun)


‘Dream Girl’ is either kinda awesome or totally sucks: Huffington Post calls it “an insanely funny movie” but concedes the second half is a mess. Mint dismisses it as flat, lazy and fake. Swaddle goes further and calls it “a tired, boring dude-fest with all the trappings of performative feminism.” In related news: The movie raked in Rs 10.5 crore on the first day, making it the most successful opening for Ayushmann Khurrana.


The most confusing health news about naps: People who take frequent naps during the week are at the highest risk for heart attacks and strokes. Next up: people who never nap. The winners: Those who nap on some days but not every day. Whatevs! (ABC News)


Human corpses are exceptionally lively: According to an Australian researcher who studies these things, bodies move around quite a bit while they are decomposing -- and do so for more than a year. Among their observations: “What we found was that the arms were significantly moving, so that arms that started off down beside the body ended up out to the side of the body." There are horror movies and then there are horror jobs. (ABC News)


The most amazing rebuttal to fat-shaming: is this eight-minute monologue from James Corden. It is worth every minute you spend watching it.


A Mumbai forest creation to celebrate: Our Ambassador Annuja Sanghvi did a very good thing. As a leading member of the NGO Forest Creators, she worked closely with local corporator Harshita Narwekar to lead a successful drive to plant 5000 saplings of 33 native species at the Colaba Woods Park in Cuffe Parade. What makes this amazing is that this initiative is entirely funded and executed by citizens!! Forest Creators uses an innovative Japanese technique called the Miyawaki Method to create dense urban forests that improve carbon-dioxide absorption and noise and dust reduction. We are super-proud of you, Annuja! See: photos and video of the event here


Weekend reads you might have missed: include the following:

  • How do you mourn the loss of a hero or idol tainted by a #MeToo allegation? It’s a question that many of us now struggle with. Sandip Roy offers a brilliantly sensitive and insightful answer.

  • Chef Suvir Saran pens a polemic on the racist use of ‘ethnic’ to marginalise and dismiss non-US/Europe cuisines in America. 

  • Inverse looks at a new MRI study mapping whether dogs actually understand when we talk to them in human language. Amazing news to no pooch owner: they do!

  • This excellent takedown of ‘Article 375’—Bollywood’s latest #MeToo travesty. There are spoilers—with warnings—as you scroll down. Related news: The New York Times thinks waving penises at parties could potentially be fun.

  • The Economist’s long read on Israil Ansari—a nineteen year old UP villager who owned a smartphone for less than a year before he became a hilariously beloved Tik Tok sensation.

  • Politico has a must-read on a respected scholar who is predicting the end of democracy—starting with the well-established ones in the West. And the problem is not our leaders.

  • Hollywood movies are now becoming almost as long as the Bollywood kind. Hollywood Reporter explains why they are testing their audience’s patience.

  • ESPN explains why grandmaster chess players lose insane amounts of weight just sitting in a chair.

  • The Guardian has an engaging piece on the return of flared trousers in men’s fashion.


Your daily quota of sunshine items: include the following:

  • The winners of the Ig Nobel prizes—awarded for “the strangest, most unusual, and downright hilarious scientific research.”

  • The hilarious news that Surat will be hosting India’s first-ever fart competition. There are three categories: longest, loudest, and musical.

  • This fab gallery of the most beautiful skyscrapers in the world.

  • This fantastic quote from Boris Johnson talking up his Brexit mojo: "The madder Hulk gets, the stronger Hulk gets and he always escaped, no matter how tightly bound in he seemed to be—and that is the case for this country." 

  • This funny clip of BJP spokesperson Sambit Patra getting spanked on a Hindi channel for not knowing how many zeroes there are in a trillion. Oh, and this unknown Congresswala is the one who delivered a rare win for his team.

  • This clip of Indian and US soldiers singing and dancing to the Assam Regiment’s marching song.

  • Yes, snail and tortoise sweaters are a thing.

  • Remember Helen Mirren looking sensational in a bikini? Well, she finally revealed the real story behind the shot that turned her into a sex symbol—and we love her more for it.

  • This guy! Carrying a fridge on his back… on a cycle?!!

  • The sheer joy of this dog as he first walks on his prosthetic legs.

  • This Swachh Bharat’ remix of ‘Bajirao Mastaani’.

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YOU NEED TO KNOW

The best place for the best advice

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How to take that first step toward financial health

Editor’s note: Here’s an excellent guide from investment advisor Rishad Manekia (more about him in his bio below) who explains what you need to do before you rush into investing your money. Think of this as your guide to taking that very first step to getting your finances in order. (PS: If you have subject expertise that can benefit our subscribers, please do ping us at broads@broadsheet.in)


It’s easy to feel overwhelmed when we start to think about getting our finances in order. We are pressured by overeager relationship managers at the bank, offered all sorts of gyaan from relatives and friends. However, here’s the upside: it gets us thinking about investing in the markets and putting aside money for the future. But before you act on any of that advice, here are five things you need to do first. 


One, follow your money: It’s payday and you finally have some cash in the bank! Cut to 15 days later and you really have no clue where all that money has gone. Financial health begins with knowing and controlling how you spend your money. It may sound tedious, but it’s actually not that hard. Here are a few ways to do it: 


  • Get an app like Walnut or ET Money to track your cash flows.

  • Or do it old school: create a simple table in a journal or use an excel template to categorize your spending. Prioritize what is essential and try to reduce your spending on the rest.


The bottomline is that you have to find a way to save in a consistent manner—month after month. And you can’t do that if you don’t know how much you are spending and on what. And unless you are already earning more than you can spend, there will be sacrifices—major or minor.


Two, clear your credit card bills: Did you know that paying down credit card debt is in itself a form of investing? A low interest credit card starts at an interest rate of 18% per year—and that debt compounds to a much larger amount over time! So if you are carrying Rs. 10,000 on your card and don’t pay it off for 5 years, you owe Rs 22,877 to the credit card company—that’s far higher than any return you would reasonably get if you had invested the same amount in equities or mutual funds. Simply not owing that amount is an investment in your financial future.


Three, create an emergency fund: Here’s the hard truth. You need to keep roughly 6 months of living expenses in a fixed deposit. This is a must-have buffer to survive any family emergency, health crisis or the loss of your job. Even if you think you are protected from any such misfortune, think of it as learning a useful lifelong habit—i.e to save. This is especially important if you don’t have any savings as yet. Just building that fund will force you to put aside as much money as you can. No, please do not dip into that honey pot to fund that trip to Sri Lanka. 


Four, get adequate insurance: The first rule of making money is to not lose money. Insurance is a must to protect you from unplanned financial shocks. Here are a few essentials to keep in mind:


  • We tend to put health insurance at the bottom of our expense list—especially when we are young or between jobs. But that is a serious mistake. Unplanned medical emergencies are the leading cause of financial catastrophe around the world. Major surgeries cost lakhs of rupees—and with a more serious condition, the bills can quickly pile up. Therefore, if you are in your twenties, take a cover of at least Rs 15 lakhs. If you are in your thirties (with a kid, maybe), ramp up to a minimum cover of Rs 20 lakhs per member of your family. 

  • Opt for a term insurance—which is essentially a life insurance that offers cover for a limited time—and only pays if a death occurs within that period. The benefit of such plans is that they are substantially cheaper than other policies. If you have anyone who is financially dependent on you (kids, parents, spouse), then you must invest in enough coverage so they can cover their basic expenses for at least a decade—in case you are not around to provide for them. 

  • Finally, it’s best to not mix insurance with investment. I am talking here about ULIPs and endowment plans—both carry exorbitant charges and give you neither enough return on your investment nor sufficient coverage on your insurance. You can learn more about why they are a bad idea here and here.


Five, plan wisely for taxes: I recommend my clients think of taxes as a separate bucket from investing. Sure, there are many avenues for an investor to save taxes but here’s the bigger picture: tax-free deductions are typically limited to Rs 1.5 lakhs a year. So if you already have insurance and a provident fund, you may gain no further benefit by investing in more tax-saving equity schemes. 


So what’s next? Once you’ve set yourself on the path to financial planning, it is best to speak to a trusted advisor. Ask friends and family for recommendations. A good advisor will create a comprehensive plan for your investments that considers your time horizon, your ability to withstand losses and ensure that your portfolio is diversified across multiple asset classes. 


Final bit of advice: There is no better teacher in investing than experience. Start small, maybe with a systematic investment plan (SIP) in a mutual fund, and build over a few years. There are plenty of options available, but it’s best to stick to simple, low-cost mutual funds that have performed consistently over long periods of time. You can look at the ratings of the funds in the Mint 50 or Morningstar’s Analyst Ratings as a starting point to help narrow down your choices. How do you pick the right fund for your needs? Well, that’s a pretty big topic which I will tackle on another day.


Disclaimer: Please note that all the information mentioned above is for educational and informational purposes only. Please consult a qualified financial advisor prior to making any investment decisions.


About Rishad Manekia: I am a SEBI registered investment advisor and founder of Kairos Capital. I started my career with Standard Chartered Bank and have spent the last decade doing wealth management and I truly enjoy helping people achieve their life goals. As for investing, every day offers a new lesson and an opportunity to do better. In my spare time, I contribute time to projects in livelihood development for the disadvantaged and I love playing the drums! Connect with me on LinkedIn or Twitter

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