Bulls, Bears and Other Beasts: A Story of the Indian Stock Market
By Santosh Nair
Overview
"Bulls, Bears and Other Beasts" is a fictionalized account of the Indian stock market spanning roughly three decades, from the late 1980s through the 2010s. Written by financial journalist Santosh Nair, the book uses the narrative device of a fictional protagonist, Lalchand ("Lala"), to chronicle the major events, scandals, and transformations that shaped the Bombay Stock Exchange (BSE) and the broader Indian financial markets.
Key Themes and Arguments
The Old Market
The book opens with a richly detailed portrait of the pre-electronic Indian stock market, where trading was conducted on physical floors, information asymmetry was extreme, and a small group of powerful brokers dominated price formation. Nair vividly describes the roles of jobbers (market makers who provided two-way quotes and liquidity), the badla (carry forward) system that enabled leveraged speculation, and the kerb market where after-hours trading occurred on the streets outside the BSE.
The Harshad Mehta Era
A central narrative arc covers the rise and fall of Harshad Mehta, the legendary bull operator whose exploitation of loopholes in the banking system to channel money into equity markets created one of India's most spectacular market booms and subsequent crashes. The book details the mechanics of the securities scam, including the diversion of bank funds through fraudulent bank receipts, and its lasting impact on Indian financial regulation.
Market Modernization
The book traces the Indian market's transformation from an opaque, clubby institution to a modern electronic marketplace. Key milestones include the establishment of the National Stock Exchange (NSE), the introduction of screen-based trading, the dematerialization of shares, the entry of foreign institutional investors (FIIs), and the creation of the derivatives market.
Trading Culture and Psychology
Throughout the narrative, Nair provides acute observations about trading psychology, market manipulation tactics, and the culture of speculation on Dalal Street. The book explores the dynamics between bulls and bears, the role of company promoters in stock manipulation, the relationship between brokers and institutional clients like the Unit Trust of India (UTI), and the evolution from physical share certificates to electronic trading.
Major Market Events
The narrative covers numerous critical market events including the bear cartel attack on Reliance Industries, the Ketan Parekh scam, the 2008 global financial crisis as experienced from India, the Satyam accounting fraud, and various IPO booms and busts.
Significance
The book serves as both an entertaining narrative and an invaluable historical document of the Indian financial market's evolution. Its strength lies in Nair's insider knowledge of Dalal Street culture and his ability to explain complex market mechanics through compelling storytelling. For anyone seeking to understand the institutional, cultural, and regulatory context of Indian equity markets, this book provides a depth of practical knowledge that academic texts rarely achieve.
