Realestate Mafia & The Share Trading Mafia

21 comments ↓

#1 TheAnand on 05.14.08 at 8:06 pm

I think shares are a whole different concept totally….you are talking about the day traders who are bent on making money on the short term based on pure speculation.

The basic motive is profit in any business. And I do not think land dealers are called mafias anymore.

#2 Binny V A on 05.14.08 at 8:26 pm

What I heard was that the high prices of land are often paid using counterfeit money - thus making Real estate a money laundering operation.

#3 Maneesh J on 05.14.08 at 10:15 pm

Since land is a tangible asset or item,we would feel comfortable and less comfortable with the stocks……..
………i think we cannot fix the price of a land or a stock of a growing company…….wat people pay is the dream price in both cases…………speculative trading would be there in both instruments…..

#4 Cijo Thomas on 05.14.08 at 10:28 pm

I dont agree..

Govt is not interested in promoting real estate but it promotes stock market.. Mainly 2 reasons.

1)Real estate is where BLACK money is invested.. Stock markets has only “WHITE” accounted money.

2) Real Estate is a dead investment.. like gold.. Stock markets money is invested in stocks means that the money is raised for working capital of company .. That means money is productive.. leading to creation of more money…

This 2 points is more than enough to justify stock markets activities.

Also listed companies are forced to be competitive since they are answerable to shareholders.. thereby increasing quality..

Stock markets is a true indicator of coountries economy but real estate is not..

#5 Cijo Thomas on 05.14.08 at 10:30 pm

# Land is a scarce resource but shares can be issued in any numbers any time

This statement is wrong. Shares cannot be simple issued to sold.. Shares represent OWNERSHIP in a company. If company issues shares unimitedly. then promoters will lose ownership!

So its stupid to say shares can be issued any time!

#6 Kenney Jacob on 05.14.08 at 11:34 pm

@Cijo Thomas
I am not taking about black money or white money. Im taking about the logic behind the both.

Shares are a good concept. But Share trading is not. How does daily trading help a company to raise capital ? People who dont event have any clue about the company watch NDTV profit and do transactions. How does that help a company ?

All that I am saying is that, share trading is also controlled by a mafia. Its just that we give it a respect that it does not deserve.

The difference is like, shakeela showing cleveage and aishwarya rai showing cleveage. Its just we call the first one B grade movie, and for the second one we go with our family.

#7 Hari on 05.14.08 at 11:58 pm

Ken you finally put the train of thought into a post (kudos boss!!)

Cijo when dwelling on #2 is right actually.

But the fluctuations do a terrible thing to the sense of belief in the system.

I don’t remember the movie but the sequence goes thus -

(mother to child ) “You shouldn’t play with tony - his father is a fallen man who spends all his money gambling and betting on horses - that’s against the word of christ you know son;

The child replies (as only children can) “But then papa is also against christ, mama”

“How Dare you!” says mama.

Tony:
“Doesn’t papa work as a stock broker betting on companies, how is it any differrent?”

…..

#8 Hari on 05.15.08 at 12:07 am

The concept of intra day trading has to changed and new norms brought into place by SEBI with trading allowed @ the end of every quarter for listed shares.

#1 It gives the trader more of an idea of what he is getting into.

#2 It reduces the speculation concept.

#3 Remove the bad concept of “over subscription” & “premium” [Read ADAG Comm IPO farce]

#4 Issue, regulation and followup on IPO’s can be monitored.

#5 Pressure on the company to perform.

#6 Dalal Street wil be more peaceful with no danger of India self imploding in case of a Nucelar “incident”

SO people four times a year is the way to go.

#9 Cijo Thomas on 05.15.08 at 6:24 am

How does daily trading help a company to raise capital ?

Daily Trading never helps any company directly! Its just gambling!

But SHARE TRADING is not!! Share Trading and Day Trading is different!

With out trading ‘how can one ensure liquidity’? So trading should be there..

And yes i do agree, daily trading is not good.
It helps govt earn crores per day as STT.! :p

”
All that I am saying is that, share trading is also controlled by a mafia. Its just that we give it a respect that it does not deserve.

”

Kenney bhai, how can u say STOCK market is controlled by some mafia or so? If some is controlling it, then they should be able to control determine prices.. Well, its not the case. Mafia could control prices of penny stocks only. Not the price of any good company.

For eg, how can one possible control the pricing of reliance? (some has tried it back 30 years.. and hope u know what happened!)

Its price is controlled by companies expected profits.

#10 Kenney Jacob on 05.15.08 at 6:52 am

@Cijo Thomas
Ever heard of the name Harshad Mehta ? We know him just because he got caught. There are thousands of such Mehtas who are still manipulating the publics money. They form the mafia.

And about reliance, in how many occasions have they forced the govts the change laws in favour of them.

Like you said, only penny stocks can be controlled by the mafia, only a minor area of land is controlled by the traders. Its just that they get too much attention.

#11 Cijo Thomas on 05.15.08 at 7:17 am

Ever heard of the name Harshad Mehta ? We know him just because he got caught. There are thousands of such Mehtas who are still manipulating the publics money. They form the mafia.

harshd metha played with penny stocks!

#12 abdunni on 05.15.08 at 8:49 am

Nobody says that buying and selling land is a sin. It becomes a problem when a group suddenly starts buying large span of land properties, small/big, in a region at very very high rates. There are two reasons behind that. 1. these groups have money from illicit sources to be invetsted. 2. they have information from their agents in government that some big establishment like technology park etc. is abt to start in that region. A typlical example is the land transactions that took place near kazhakkuttom, trivandrum almost 6 months before the govt. announced aquisition of land in that region for Technopark.

Buying and selling some commodity,say, rice, is a decent business. But what will happen to the rest of the society if somebody suddenly buys all the rice available in the market at high rate without trading it out. This is what we call black market and the aim is to create artificial scarcity and priice hike. Unfortunately, the same thing happens in land trade.

#13 Kenney Jacob on 05.15.08 at 8:56 am

The same is the problem with shares also. Someone starts buying and everyone follows. Big guys with loads of money manipulate the market. See what reliance is doing.

Share trading is a polished and legal means cheating. Its the most artificial business that I have ever seen.

#14 jojo on 05.15.08 at 10:15 am

I am not so aware about share market now, but am interested to learn more about it.

But I liked your analogy “The difference is like, shakeela showing cleveage and aishwarya rai showing cleveage. Its just we call the first one B grade movie, and for the second one we go with our family.”

but who said real estate people are not getting respect? many biggies are there naa?? Konfidence group, SRK Group, Skyline…The list is so BIG!! aren’t they respected on their business???

#15 Kenney Jacob on 05.15.08 at 10:23 am

@Jojo
We are talking about a different kind of business here. There are realestate people who buy land in bulk in areas where there is development. Then they split them up in to plots and sell at a higher price.

These people dont have any big names. They dont do constrution. They dont add any value to the land. They simply cash in on the opportunity.

Share trading is also similar. People simply cash in on the opportunity. Traders dont add any value. Cash in on the fluctuations. Thats what trading is all about.

#16 Cijo Thomas on 05.15.08 at 10:34 am

Trading dont add value friends!! Whether its share or real estate! BUt trading in shares is needed for liquidity! If there is no trading then there is no share markets!

But real estate is dead investment. It doesnt add to economic growth.. Real Estate,Gold etc are dead/ But bank depostits , investement (remember INVESTMENT & ot day trade) are not dead. They create more wealth.. as bank loans are proving capital for industries.. leading to growth… Shares add capital and thereby leads to growth..

But Real Estate is not contributing anything to economy If 10000ppl buy land… it only means they have money and it never contributes to DEvelepment (unless they use it constructively.)

#17 sanils on 05.15.08 at 10:35 am

Who defines the word real estate mafia or share trading mafia ?

Its all created by medias. You know 15 years back there is nothing what you called mafia for people who are doing real estate / share trading. So when it became mafia? People do recognize the real estate / share trading benefits thereby medias. All media want hot news . They really created the mafia image for these business. If some other business is there that create more profits like share trading and real estate then its sure this media will brand those business also as mafia

#18 Cijo Thomas on 05.15.08 at 10:37 am

Ur comparism of aish and shakeela is good!

Remember in Rajamanikyam Mammoty says ” adukkalakaari jaanunum Aishwaryakum same vila aano? 2-um pennale! ”

:))

#19 Cijo Thomas on 05.15.08 at 10:41 am

for jojo
”
but who said real estate people are not getting respect? many biggies are there naa?? Konfidence group, SRK Group, Skyline…The list is so BIG!! aren’t they respected on their business???

”

They are different .. They are real estate developers. Buys lands in bulk. Develop flats, buildings,malls etc and sells. So it contributes to GDP and they are well appreciated.
DLF,Unitech leads the list .

Skyline , Konfidence are chotta players compared to DLF.

What kenney was talking is about real estate traders. They buy land.. sell as such.. for higher money.!

#20 abdunni on 05.18.08 at 9:37 am

sanils statement is an unrealistic generelization.
As i mentioned in my previous comment, real estate buisness, or any buisiness for that matter, is decent buisiness when there is ethics respect for fellow beings is in it.

#21 Kenney Jacob on 05.18.08 at 9:54 am

How does real estate become a business where you dont have respect for fellow beings ? Its a business where every one wins in most of the situations.

But in share trading I can point out examples of many who have lost loads of money.

And remember this. Land cannot be created and for that single reason land prices will go up cos our economic situation of the world is improving. There is nothing we can do about it.

In Chennai (adayar), the rent for a 3BHK flat is 20,000. Electricity, water and other expenses are additional. Is it a mafia ? No because there is so much of demand and people are willing to pay.

I have a land in kottayam. Someone is quoting 75,000 per cent. But someone else is willing to give me 1 lakh per cent. Will anyone in this world sell that to the first person for 75,000. Im sure no one will.

When Kinetic Honda was introduced in the market its price was 13K. But there was no one to buy and they reduced the price to 9K. But somehow the product took off. They started increasing the price. My father bought a kinetic honda for 36K. Is it a Mafia ?

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