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Sunday December 31, 2006 LETTERS TO THE EDITOR
Mutual funds and risks

DEAR EDITOR: This is a response to Peter Hospedales of Diego Martin whose letter to the Editor was reproduced in the issue of November 19.

In his letter he states, “Whilst these mutual funds attract a higher interest rate, there is a higher risk of loss associated with them….”

All can I say is that Mr Hospedales should have realised that when one receives a higher rate of interest, it is because there are more risks. He himself admits to it in his comment. Unfortunately the populace does not appear to appreciate this and is attracted by higher interest rate without understanding that there are risks.

Mr Hospedales also comments “The commercial banks are not advising investors of what is occurring….”. To the best of my knowledge, all banks that have sold mutual funds post valuations on a weekly basis, so the investor can carry out his/her own valuation. Mr Hospedales complains that, “The bank conveniently even sent my statement late….”.

 I am not sure that mutual fund investors get statements regularly as an industry practice, maybe semi annually or quarterly. That’s why valuations are provided on a weekly basis. In some cases, daily valuations are provided.

I empathise with Mr Hospedales on his decline in value of his mutual funds. I am not sure when he bought the funds whether he was told that mutual funds have risks. If he did not, that’s terrible and the bank in question should be questioned. I know that some ads state that the funds are not covered by Deposit Insurance. To me that sends a message.

I take the opportunity to point out that even the funds that are currently called Money Market Funds have risks. Additionally they are being called “Money Market Funds” but technically they are not because the instruments invested in are not all money market instruments and in fact have a maturity profile beyond 12 months. That’s why these so called money market funds are yielding rates higher than a bank deposit.

There is draft legislation on Mutual Funds, which hopefully we will see enacted in 2007. It would be interesting to see if the regulators have these funds re-titled after legislation is enacted, otherwise we will continue to see comments similar to Mr Hospedales’.

We now all look forward to the Financial Literacy programme to be launched in 2007 by the Central Bank.

In the meanwhile, I urge Mr Hospedales to call on his bank for information and thank him for writing his letter as it is time that investors understand more about mutual funds.
RP Young, Port of Spain

Let us continue the struggle

DEAR EDITOR: By the time you read this you would have heard of the announcement by Prime Minister Patrick Manning during his Christmas Eve address to the nation that the government is not going ahead with the Chatham/Cap-de-Ville smelter!

It must be noted at this juncture that this is simply a further manifestation (and a predicted one at that!) of the truth of which we have been reminded on more than one occasion before - i.e., simply stated, THE PEOPLE HAVE THE POWER!!!

Contrary to whatever the media, the Government, and myriad other public sources of information will say, there is ABSOLUTELY NO OTHER REASON for this latest about turn by the Government outside of the relentless, sustained public pressure, of many forms including and especially the use of objective fact-based, informed perspectives on the issue, but also the so-called “emotional” and “misinformed” displays, which were really grounded in truth from the beginning and which led to the former.

Throughout the life of this issue the proponents of the projects, especially the Government, have tried to use the tactic of intimidation by making the public feel like the fight was hopeless (“yuh doh like smelter, we bringin three!”), that the Government will go ahead regardless, that it was “a done deal”!

And throughout that time, they have succeeded to a great extent in that pursuit of weakening the resolve of persons concerned about the issue – but only among those who were the weakest links from the beginning!

Among those really serious about it, those with pure unselfish passion for nature, nation and fellow man and woman, whose actions, untainted by ulterior motives, remained fuelled only by “boundless faith in our destiny”- among these Power People- it only served to strengthen the resolve that much more!

And while this latest development may be given a lot of attention, it is important to recognise that these two fundamental truths- [(i) that THE PEOPLE HAVE THE POWER and (ii) that TRUTH with patient perseverance brings success] have been proven by small victories which have occurred during the life of this struggle, but which sadly were missed by the majority, and that this is only the latest of a long line of such victories. But as they say, “Those who have eyes to see shall see!”

As such, let us then understand that these victories will continue – but only as long as we continue the struggle. Let us also heighten our senses so that we are able to recognise even the smallest of these victories when they do occur.

The timing of this occurrence is fitting, for while the birth and message of Christ were great blessings to mankind, we have witnessed the perversion of both by the powers that were (and those that continue to be), sometimes unconsciously and often with the best of intentions, but ultimately for their own gain.

Yet they will never be able to reverse nor erase the essence and power of these blessings. So too, let us remain vigilant in being grounded in TRUTH, HONESTY and CONFIDENT HUMILITY, lest we too get carried away in the perversions and misuse of this positive energy, which will inevitably occur, or at least be attempted.
Merry Christmas everybody, and may God bless our nation.

Christopher E M Castagne (via email)

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