top of page

By:

Kaustubh Kale

10 September 2024 at 6:07:15 pm

Silent Money Killer: Loss of Buying Power

In personal finance, we often worry about losing money in the stock market, dislike the volatility associated with equities or mutual funds, or feel anxious about missing out on a hot investment tip. Yet the biggest threat to our wealth is far quieter and far more dangerous: loss of buying power. It is the invisible erosion of your money caused by inflation - a force that operates every single day, without pause, without headlines, and often without being noticed until it is too late....

Silent Money Killer: Loss of Buying Power

In personal finance, we often worry about losing money in the stock market, dislike the volatility associated with equities or mutual funds, or feel anxious about missing out on a hot investment tip. Yet the biggest threat to our wealth is far quieter and far more dangerous: loss of buying power. It is the invisible erosion of your money caused by inflation - a force that operates every single day, without pause, without headlines, and often without being noticed until it is too late.
Inflation does not take away your capital visibly. It does not reduce the number in your bank account. Instead, it reduces what that number can buy. A Rs 100 note today buys far less than what it did ten years ago. This gradual and relentless decline is what truly destroys long-term financial security. The real damage happens when people invest in financial products that earn less than 10 per cent returns, especially over long periods. India’s long-term inflation averages around 6 to 7 per cent. When you add lifestyle inflation - the rising cost of healthcare, education, housing, travel, and personal aspirations - your effective inflation rate is often much higher. So, if you are earning 5 to 8 per cent on your money, you are not growing your wealth. You are moving backward. This is why low-yield products, despite feeling safe, often end up becoming wealth destroyers. Your money appears protected, but its strength - its ability to buy goods, services, experiences, and opportunities - is weakening year after year. Fixed-income products like bank fixed deposits and recurring deposits are essential, but only for short-term goals within the next three years. Beyond that period, the returns simply do not keep pace with inflation. A few products are a financial mess - they are locked in for the long term with poor liquidity and still give less than 8 per cent returns, which creates major problems in your financial goals journey. To genuinely grow wealth, your investments must consistently outperform inflation and achieve more than 10 per cent returns. For long-term financial goals - whether 5, 10, or 20 years away - only a few asset classes have historically achieved this: Direct stocks Equities represent ownership in businesses. As companies grow their revenues and profits, shareholders participate in that growth. Over long horizons, equities remain one of the most reliable inflation-beating asset classes. Equity and hybrid mutual funds These funds offer equity-debt-gold diversification, professional management, and disciplined investment structures that are essential for long-term compounding. Gold Gold has been a time-tested hedge against inflation and periods of economic uncertainty. Ultimately, financial planning is not about protecting your principal. It is about protecting and enhancing your purchasing power. That is what funds your child’s education, your child’s marriage, your retirement lifestyle, and your long-term dreams. Inflation does not announce its arrival. It works silently. The only defense is intelligent asset allocation and a long-term investment mindset. Your money is supposed to work for you. Make sure it continues to do so - not just in numbers, but in real value. (The author is a Chartered Accountant and CFA (USA). Financial Advisor.Views personal. He could be reached on 9833133605.)

The Myth of the Inspired Artist

Art has long been romanticised as a gift from the gods, but behind every brushstroke lies practise and relentless resolve.


Robert Hannah, Master Isaac Newton in His Garden at Woolsthorpe, in the Autumn of 1665, circa 1850
Robert Hannah, Master Isaac Newton in His Garden at Woolsthorpe, in the Autumn of 1665, circa 1850

The artist struck by divine inspiration driven to create a masterpiece is a persistent trope glamourized in literature and film. Often it is a self-perpetuated myth propagated by artists unwittingly doing themselves a disservice, because reality is somewhat different – and always has been. The proverbial 1% inspiration 99% perspiration applies to art as much as to any other field

M.F. Husain, 2007
M.F. Husain, 2007

of endeavour, creative or otherwise. One might even posit that an artist is more likely to be hit by lightning than by inspiration. Michelangelo said, “If people knew how hard I worked to get my mastery, it wouldn’t seem so wonderful at all.” Many apples have fallen on people sitting under trees, but it’s only because Newton had been thinking something through that the falling fruit led to the theory of gravity. Artists have painted remarkable scenes of the banishment of Adam and Eve from the garden of Eden, and still-lifes with apples, but none waited idly, to be hit with the idea. American artist Chuck Close said, “Inspiration is for amateurs. The rest of us just show up and get the work done. If you wait around for the clouds to part and a bolt of lightning to strike you in the brain, you’re not going to make an awful lot of work.”


Apprenticing in an atelier, be it that of a Renaissance master or Nainsukh of Guler, would have been an exacting and demanding vocation. Practice, practice, practice, was the refrain. Many are unaware that modern art schools too are a slog. The studio art component of the curriculum consists of month after month, year after year, in which the student must put their work up for critique. Umpteen late-night supplications for inspiration to strike have been in vain. Putting up work means being told over and over what is wrong with it, how it’s not good enough, how you can do better. Constant judgement in a field that is subjective by definition, can play havoc with the self-esteem of a young artist-in-training, but it is better to learn early that making art is not easy and requires hard work and tough skin, not just in art school but for the entirety of the artist’s career. Excelling at one’s craft is a continuous endeavour of learning the rules so they can be broken later. If the artist is at all to be considered a vessel through which creativity flows, it is only because “The artist is a receptacle for emotions that come from all over the place: from the sky, from the earth, from a scrap of paper, from a passing shape, from a spider’s web,” to wit the ever-quotable Pablo Picasso. This can be interpreted to mean they are constantly “inspired,” and consequently, constantly at work. MF Husain, always brush in hand, painted on canvases, on walls, on cars and on horses, even on someone’s front door while he waited for them to open it.


Inspiration is often paired with the other intangible – talent. French writer Émile Zola said, “The artist is nothing without the gift, but the gift is nothing without work.” Sketches on napkins, however inspired, remain ideas until they are developed, because “success is a worn down pencil.” (Robert Rauschenberg). In the current debate over whether AI can be as creative as a human being, there is much angst over defining creativity. Algorithms for a Mozart piano concerto or a Picasso painting can only be generated because Mozart and Picasso developed a body of work over their lifetimes (brief for Mozart, long for Picasso) by being prolific. Henri Matisse, another relentlessly hard-working artist who termed his last 14 years in a wheelchair “a second life,” said, “Don’t wait for inspiration. It comes while one is working.”


Though many of the artists quoted above were prolific, quantity is meaningless without quality. Those with a more measured output are not lesser artists. There are only 10 paintings attributed to the polymath Leonardo da Vinci, and Johannes Vermeer of Girl With a Pearl Earring fame has only 34. “Art resides in the quality of doing, process is not magic,” said architect and designer Charles Eames. There is no substitute for the process, though artists may disagree on whether it is the means or the end in their personal practices. Art “must be conceived with fire in the soul but executed with clinical coolness,” said Joan Miro. This fire and ice approach means having the courage to accept that not everything created is equally worthwhile – that lesson learned in studio art critiques.


Yet even with hard work, sometimes aided by great inspiration, “Every creator painfully experiences the chasm between his inner vision and its ultimate expression.” (Isaac Bashevis Singer) This is very much the reality of the artist’s creative life. The blank canvas holds all the possibilities, but the completed one rarely matches up to what the artist had imagined. Does art result from inspiration, passion, talent? Author Natalie Goldberg doesn’t waste time ruminating on these questions: “One just has to shut up, sit down, and [create].” Opportunity, marketing, luck? These are even more elusive intangibles, definitely not taught in art school.


(Meera is an architect, author, editor and artist.)

Comments


bottom of page