Some years ago, I was enrolled for a basic course on stock markets at the BSE training institute. I was a few months into Mumbai and hadn’t been to Dalal Street before. After getting down at the local terminus named after Chattrapathi Shivaji, I was trying to hire a cab to get to the iconic building. Though I know it was somewhere nearby, I didn’t have the time to walk it down. I asked for BSE, then I asked for stock exchange, then I tried to describe the tall, circular building. The cabbies simply failed to understand. For a moment, I even thought it was some conspiracy by North Indians to derail my progress in my fledgling career by denying/ delaying entry into the hallowed PJ Towers.
Then somehow I managed to convince an old man to take me promising to give the directions.
Finally, when I asked him to stop in front of the BSE skyscraper (those days the bourse had not ringfenced itself like today), the cabbie said, “Saab, yeh to share bazaar hai. Aap toh kuch aur bol rahe the. (This is share bazaar. You said something else).”
This incident crossed my mind when I read the Business Standard headline on Vyaj Badla. As early as in June 2010, First Global strategist Shankar Sharma had argued for the return of Badla in an article published in DNA http://bit.ly/QdUc3N.
It’s too early to predict the fortunes of the latest BSE plan to get back in the game. It will also be too premature to predict if the product will recreate the magic of Badla, Sharma had argued in the above article, which addressed the needs of both traders and investors thereby harnessing the liquidity from both these streams and giving the market the much-needed depth.
As the foreigners brought in big money, we created products, which their B-school syllabuses had taught and discarded as dirty, because they did not fit their theory. We found it easier to copy-paste their rules and regulations. Worse, we hired their B-school graduates to manage money for us. We bent over backwards to make them feel at home, similar to what we are doing in the recent episodes of GAAR.
Somehow in the process of building a supposedly cleaner and healthier system to attract big-ticket institutional money, we seem to have alienated the man on the road. We have made the body look healthy (superficially) but chased away its soul – the small investor.
We have become Marie Antoinettes of France who asked the masses to eat cakes, if they didn’t have bread.
Which is why I like the cash-future spread’s packaging giving it an Indian name, Vyaj Badla, that even taxi drivers can understand. The exchange should go ahead and list it as Vyaj Badla and not as some “Reliance cash-future spread near month”. I don’t need to tell you how alien the latter sounds.
If you make products based on what people already understand and give them names that don’t knot their tongues and scare them, you won’t need to spend crores in so-called “investor education,” which scares them even more.
Simplicity is the highest form of sophistication and is the first step to retail penetration, which several capital market players, such as exchanges, mutual funds and administrators have been harping upon for decades now. But, with a fundamental linguistic dysfunction, they may never achieve that. Keep it simple. And, if you are in Kerala, keep it ‘simble’. They like it that way.
