Satyam and the Common Man

We all know what happened to Saytam. Actually we dont. We are just feeling the aftermath of it. Two days ago I went to buy DVDs at my regular merchant. His shop is filled with anything and everything related to computers. Like a sage in the Himalayas, he sits in the middle of his goods. Today he was a bit upset. No, he was damn upset. He was on the phone arguing with his broker. Upon some pep talk he relieved that he invested 2laks in Satyam when the price was Rs 40. At the time we spoke it was Rs 19. He was trying to convince his broker to extend his margins so he could go long with fresh stock and cover his loses. Obviously the broker didn't agree and why should he. My merchant is just one of the buffoons who made a suicidal gamble on the stock that is falling faster than the asteroid that stuck earth during the dinosaurs. After listening to him I realized that not all dinosaurs went extinct. They have evolved into what we call ordinary investors (who invest without researching the company).

Ramalingam Raju is not the only one to blame. Investors are at fault too. Especially those who pushed satyam prices from Rs 600 to Rs 800 where it peaked. And those who still purchased when the prices were falling should be banned from trading. Ofcourse, if they are banned then how will the professional trader make money. If nothing else, the satyam debacle has thought us one thing that the world will continue to revolve round the sun and people will continue to revolve round the stock market, not to increase their wealth, but to give it away to smart traders.