Happiness comes from sharing

Good news at last!!!!! Got the job I wanted....so I am happy :)

Bad News...suffering from what I call withdrawal symptoms...When you have worked through the year so hard..now all of a sudden you fill the motivation of doing assignments, attending classes all goneeee...

I went through hell for the last one month and at last there is some ray of hope.Some hope that only bad things do not happen to me. Anyways lot has been said on this topic already. I also realized that to be really happy you need to share the happiness with someone. My parents are happy at last. They went through most of the emotions that I went through as well. They were concerned whether their only son would come out of the state he was in.

I admire my dad...He lost everything in life when he was in his teens..Settling in a new country with nothing..no money...was one of the scariest stories I have heard. But he fought his life out of it and ensured that he gave me good education and all the things he could not get in life when he was growing up. I guess when you go through things you see life in a different perspective than people who have had a more comfortable one. I can still picture his face with tears in his eyes as he stood on the Hollywood walk of fame last year. He said he got more from life than he ever imagined.

I inherited the fighter in me from my dad and I am proud of that. It has helped me survive odds and come out of it clean. And I hope I can always be the down to earth fun loving guy who likes to look at the world simplistically without bias of money or status. Someone who never forgets his roots and the realities of life....who can love and be happy. Anyways after all this senti talk...let me stop...You all take care and wish me luck with rest of ISB.

New address

Should have put this up a long time back - ISB has a new blog address - our batch has started the ISB official blog: http://isbweblog.com

As for me - I have also shifted my blogs:
Photo Blog: http://controlyourproject.com/PhotoBlog
Blog: http://controlyourproject.com/blog

ISB Energy Conclave | 25th October 2008

The Energy, Manufacturing and Operations Club at the ISB is hosting The ISB Energy Conclave – Gearing up for the energy challenge: Energy strategy – challenges and opportunities

India is the fifth largest energy consumer in the world, and its demand for energy is expected to increase further in the coming years. Moreover, India has the largest incremental energy consumption in the world and despite the country being the seventh largest producer of energy it is a net importer of energy.

On the one hand this poses a challenge to meet the increasing demand, while on the other it presents a great opportunity for the country to emerge as one of the most energy efficient countries of the world. There exists new energy paradigm that can fundamentally alter the ways in which the energy is produced and consumed. Emerging economies like India have the potential of becoming energy innovators in the future as they are confronted with the high cost of energy. In a bid to understand the changing dynamics of the Energy Sector, and explore the road ahead in India, Energy, Manufacturing and Operations Club (EMO) at ISB is hosting the ISB Energy Conclave.

In line with the theme, some of the topics that will be discussed are as follows:

1.      Energy self sustenance for the world – is it possibility?

2.      Challenges and opportunities considering growth of India Inc

a.       Hydrocarbon Opportunities in India.

b.      Nuclear Energy – the future opportunities for India?

c.       Opportunities in Alternative/Green Energy

3.      Emerging business model in the energy sector

4.      Rural energy problems – scope and economic feasibility

 The Conclave is primarily targeted at the students in the school with a limited external participation.

The flagship event of the Energy, Manufacturing and Operations Club has been initiated for the first time at the Indian School of Business (ISB) this year. To address the dynamics of the energy sector with changing times, the club hopes to make this a regular event. At the Indian School of Business, the student body in general and the Energy, Manufacturing and Operations club (EMO club) in particular are very keen on understanding the current and future Energy trends and the ways to meet the future energy demands. The EMO club also focuses on identifying new opportunities in this sector and is looking forward to understand the future implications of the same. The club therefore, proposes to organize a panel discussion with the key energy producers in the country to understand the strategies to meet the impending energy challenges.

Term 2 - Photowalk

I promise to keep this one as short as possible – its not going to be as long-winded as the earlier one about term 2. Mainly because the only thing that changed was the subjects we were being taught now. Let me see – they were Competitive Strategy (Compstrat), Decision Modelling and Optimisation (DMOP), Global Economics (GLEC) and Marketing Decision Making (Markstrat). [I cheated – there was no way I was going to remember the subjects I did soo long ago]

Actually that's one of the chief features of life at ISB – the days move along so fast that they're a blur – but when you look back they seem so far away – probably because so much has happened since.

One of the more interesting parts of the term was the markstrat simulation – where each study group was allotted a firm and we had to compete to gain profits, market share, etc. Good fun !

Anyways – the term started with the skies clouding over, and impending rains on the horizon. The campus looked beautiful as the sky simply accentuated the buildings.



And our first rains – when the mirror pools filled over and we got back to our childhood – making paper boats and playing J





The start of the term was a haze – with all sorts of activities including elections for the extended GSB. (I guess I forgot to mention the GSB elections in the first term – but lets leave that for now – too much to write, too much to say . . . .. ) Well the election results came in and we had another reason to celebrate – probably the largest party in D-Lounge till date. A night full of partying – we were at it till early morning.



Ashish and Anurag HAD to be in all photographs . . . .





And we have our marketing club president (Kedar) making faces . . . .



Another good thing that happened: I took out my camera and started clicking photographs. So here are a few I took from the campus itself:





But that was not all – our class found out the meaning of "BORING" classes and sights like these were two a penny.



Like I promised – this was going to be short and sweet – even though I probably missed out describing quite a few parties and events. On the whole however Term 2 was very similar to Term 1.

Real Estate Club – Infrastructure Summit

The Real Estate and Infrastructure Club at the ISB in partnership with Indu Projects and Ernst & Young, is hosting the ISB Infrastructure Summit on September 16, 2008. The aim of the Summit is to bring key industry leaders from both the public and the private sector together to share their views on the current trends and challenges faced by the Indian Infrastructure industry. The theme of the summit is "Indian Infrastructure – Status, Trends, Issues, and Challenges".

India has made rapid progress in the Infrastructure sector in the last few years with the private sector playing an increasingly important role. Over the next five years, the Indian Government has forecast a total infrastructure spending of USD 600 billion of which 30% is predicted to come from the private sector. While the sector offers immense opportunities, there are several hurdles and issues that need to be addressed if these goals are to be met.

The Infrastructure Summit is one of several key initiatives that the Real Estate and Infrastructure Club at ISB plans to undertake in the course of the year. A tremendous amount of emphasis has been put on infrastructure development for sustaining the Indian Economy's phenomenal growth. The role of excellent management talent in the Indian Infrastructure industry is becoming increasingly crucial with the infrastructure sector becoming more organised, increasing competition with growing private sector, innovative partnership models including public, private, and foreign players, and complex financial structuring of infrastructure projects. The Infrastructure Summit is aimed to showcase the ISB as leading the push for infrastructure development in India by training future leaders for the industry. The event will serve as a platform for industry leaders to interact with the premier management talent of the country and share the opportunities available in this dynamic industry.

The event would involve an inaugural session and three panel discussions:

Inaugural Session :

* The Infrastructure Sector – Progress and Learning

Panel Discussions:

* Concession Agreements

* Financing Infrastructure Projects

* International Perspectives

Please register at http://www.isb.edu/SeminarsConference/Infrastructure/SeminarRegistration.aspx

Term 1 - Photowalk

I think Whirlwind is one word that I'm going to use very often - at least for the next one year. The last month and half have been absolutely crazy - and yet there's always been time for the myriad activities that vie for our attention. Actually I think I'll make more sense if I do this chronologically. Started from Delhi on April 11th in the train. Was joined by quite a few "future" classmates. We had planned to take the train - even though it was almost 36 hours. But it was worth every minute - it probably led to formations of life-long friendships - not to mention the fact that we "Reely Reely" enjoyed every second. I had brought along a bottle of Absolut Pear - which we judiciously finished over the course of the day. We chatted, played cards, watched a movie, chatted some more and partied all the time. Don't think that words can really describe the amount of fun we had - so here are some pictures:

Reached ISB in the morning and went straight to our rooms - was pleasantly surprised at the amazing campus (even though I had seen so many photographs on the net - none of them came even close to the real thing). The rooms were perfect - neat and clean and spacious and I must mention the great quality of the hot water showers. We got ready and went straight for the registration - which was a loooooong affair - mainly because of the HUGE rush at the SBI counter. But we got through and by evening we were true-blue students of ISB. So it was time for some champagne - to mark the start of what we hoped (and which I can vouch for now) would be an amazing one year. So a few of us got together and opened the "bubbly" - of course there was lots more after that - but the details are lost in the endless glasses of "daru" :-) There was a nice dinner (though no Hyderabadi Biryani) where we got to interact with our batchmates and alums. I'm sure I still don't remember half the names I heard that night. The next day "Sunday" (At one time Sundays were a holiday - I wonder where that time went . . . . . ) started off our whirlwind tour of ISB - orientation to the various clubs, the acads, and what not. Not a very interesting day from my viewpoint - but I'm sure many people enjoyed it. And at night we had a great party - organised by the alums

Monday kicked off the orientation activities with a treasure hunt. The alums had gone to a lot of pains to ensure that we understood the entire layout of the campus. Of course an easier way would have been to give us all maps - but this was more fun - even though it was tiring and hot and sunny and sweaty. Though we did get a beer in the middle upon reaching the Event's Lounge (where most of the parties happen now). And I was "dunked" into the pool on finishing the treasure hunt. Man that was refreshing (Did I mention that the pool is really great - even for non-swimmers like me - its 5' all over)

Orientation week went faster than we had expected. There was a plethora of activities ranging from bind and unwind to talent night to inter-section sports. A few photos to show the various things we went through: Section A Cheering squad:

Our very own macot - Arbit:

Making an 'A'

Relaxing while other's worked ;-)

Talent Night - Goodness Gracious Me:

However the pre-term courses were a pure waste of time and money. Didn't get any great insights - but wasted an entire week which could have been used to enjoy the campus more.

 

The bondings made in the train led to the creation of amazing friendships and we started the term with a small party at the "D-Lounge" we drank, we danced and we had our very own live music - courtesy "talli" aka Pratik - who sang for the sole benefit of the "blushing" Guntas. A perfect start to the year none of us would want to forget. The singing and the drinking started around 3:00 (we were partying outside before) and went on till the early morning . .

Talli singing for Guntas:

The much needed "Maggi" Break:

And all that remained afterwards were the empty bottles - our first (and hopefully last) experience with Cobra and King Cobra beers - were we sloshed by the time we went home (5:30 AM):

This was the start of many amazing parties at the D-Lounge. We've had parties, and parties . . . Many of you would be wondering - what is this guy saying - ISB is supposed to be synonymous with pressure, studies, nervous breakdowns . . . . . you may be correct in many ways - as we found out on the first day of class. If any of us were expecting that the first class would be like an introductory session - were we shocked - it was RUN from the first instant. The time allotted for each subject is just enough to finish the curriculum. On top of that we had the infamous "class participation" - where everyone has to participate in class and you are marked for the same. The frenzy this caused in the first term was absolutely crazy - people had their hands up all the time, desperate for something (anything) to say. So we had our very own "CP King" and "CP Queen" contests - the winners got dunked (alongwith half the section who went in just for the fun of it)

The Queen:

The King:

And the praja:

It was soo much fun that none of us wanted to get out of the pool. And of course the CP went down to "near acceptable" levels :-) Then came the first marketing assignment - The Gillette case - the case which made half the batch boycott Gillette (not because there was anything wrong with Gillette - we were just sick and tired of hearing the word) and stop shaving. To mark an end to the assignment - what do we do . . . we have another party:

ISB works on what we felt was a very peculiar system - each professor comes for two and half weeks - takes 5 classes for each section and goes back - so by the time you get used to a professor - its time for him to leave.

By now I'm sure you can guess what happened when the first set of professors were due to leave - Yup - you guessed it - we had a party - a huge blast with champagne flying around and the professors partying with us.

Next came the mid-terms -- I think ISB is the only place where you have exams every 3 weeks - and since these were the first set of our exams - the entire campus went silent - people cooped up in their rooms or LRC and started slogging like crazy - the tension went up so high that you could taste it in the air. But as with everything else - they finished almost before they had started and the campus was back to its crazy pace. Then we had the CAS photo sessions - and you saw a remarkable change in the batch - we had people shifting from T-shirts, and shorts into Suits with Ties !!

We've done a lot of crazy things - one of them being - making pakoras at 3:00 in the morning:

|

Alongside all this - the studies went on and before we knew it the end-terms were at hand. This time the silence was not as profound and we could actually see some people chilling out even the night before the exams. And whew - I'm tired now - this has been a long winded blog - but any shorter and I would not have done justice to the parties :-)

blogblogblogblogblog

ISB Campus - Night View

ISB Private Equity Conference: 6th September 2008

The Finance Club at Indian School of Business will host the ISB Private Equity Conference on September 6, 2008. This is a unique event and the first to be held by a B School in India. With so many M&A deals happening in India and abroad, PE suddenly has become a hot sector. Many global PE companies have also set up shops in India and are looking for some attractive opportunities. It is anticipated that the global slowdown will spur the PE activities, as companies become more attractive during the recession times.

This Conference serves to bring together private equity professionals, industry leaders, students, alumni and faculty to discuss recent trends and emerging issues in the private equity industry. It will provide a platform to discuss the opportunities and the challenges for private equity investments in India. Further, it will act as a forum for private equity professionals to interact with pre-eminent business leaders and India’s brightest human capital present here at the ISB.

The daylong event would involve a keynote speaker and two panel discussions on:

Quo Vadis Private Equity? Sunrise sectors, deal valuations and exit strategies. The panel will discuss topics such as ‘Are education, healthcare and media the new poster boys for private equity investments?’ and ‘Exit Strategy: Are the investment horizons shifting?

Private Equity: Adding value to India Inc's business practices. The focus here is on family businesses opening up to private equity as a source of investment and whether private equity firms are ushering in a new wave of corporate governance norms.

Many top speakers have signed up for the event, some of the prominent one are:
Nainesh Jaisingh: MD, Standard Chartered PE
Deepak Shahdadpuri: Founder MD, Beacon India
Shujaat Khan: MD Blueriver Capital
Gaurav Mathur: MD India Equity Partners
Satish Mandhana: MD, IDFC PE
Gul Mukhey: Director, HSBC PE

Heads of other leading PE firms and also eminent business leaders from South India will also be participating in the event. This promises to be an interesting and exciting event. Well, this is the part of the deal that a global B School offers :)

ISB hmm

ISB ISB ISB ISB ISB (then a deep sigh!)
thats how i responded when a dear friend asked me hows ISB..this blog and a few coming after this are dedicated to all those who are curious abt ISB and want to know every gory detail abt the horrors it contains. Let me begin by throwing in a disclaimer every experience of ISB is unique..so while a particular person may find the going tough it might be cakewalk for some one else. What u see here is a self confessed Regular Jane's view of the world. So take it with dollops of salt. :)

How is life at ISB? hmmm imagine all human emotions the gud, the bad and the ugly and then add a few more and this what life at ISB is . Its all that u expect and a lot u dont ! let me begin by saying that there is tremendous scope of learning and growth and how much of it u r able to accomplish depends totally on u. The trick is to identify what is it that u want from ur stay here and work towards it. That said let me tell u figuring out what u REALLY want is decidedly one of the most difficult thgs to do. i mean i still feel like i am standing in front of a lavish buffet with all sorts of exotic dishes with a fork in hand !! Ok thats a bad food analogy..skipping dinner tonite was not a gud idea! What i mean is u just have so much stuff going on that choosing what to do becomes the key ..and the choices are quite stark..markstart decision (grades matter dude or dont they !!!)or say attend Kiran Shaw's talk..u got to choose and manage ur time well..this i think is going to be one of my biggest learings at ISB..i mean the most precious commodity at ISB is time and u better spend urs wisely.

The faculty ..truly world class (well most are anyway!!) i have been taught by some of the best teachers in the world and that has twin benefits : one is obvious ..u end up understanding the most obscure / the most boring subjects and the other follows from it..if u still dont understand the concepts after attending the sessions taken by these gentlemen GIVE up (on that subject that is :) ) the second point is debatable but i kind of stand by it . what i mean is if after sessions by robert stine and richard waterman u still dont get stats leave it !!! try mktg instead !!!
i had my aha moment in the Fin accounts last term.. i finally got it !!! accounting that is and i also realised that its not all that crappy ..an insight that made me warm up to my CA mates (my husband included !! ). the first term was bad ..i mean a lot if us took time to settle in to the ISB way of life ..its a different world all together ..a world were a gud night's rest means 5 hrs of sleep ..where parties typically start at 1 am..where u throw ppl in the pool when u r happy..where u develop a love hate love relationship with ur study group ..where ur self esteem sits on a roller coaster ride which has more down slides than up..where the engineers (IITians ) are gods walking on the planet with a halo around their head (the dean's list) ..well i exaggerated a lil on the halo part..its not always visible..u got to stand close and observe maybe then if u r lucky u can see it :) I am kidding life's not all that bad ..:) i wudnt exchange my ISB days for anythg with any1 ..okay now a lil abt the ppl here ..needless to say they are a talented bunch but i will not gush abt them right now..let me just say that i already have a couple of ppl who are my 2 am friends..i call them when i am happy and more importantly i call them when i have made a mess of things which is quite often it seems these days.oh well..i will consider myself very lucky if i am able to make and sustain a few gud friendships out here..i like and admire so many ppl here ..some for their intelligence..some for attitude and some for sheer goofiness :) the power of positive attitude, the willingness to laugh at oneself, the ability to cheer some1 else these thgs really matter at here

i am in Sec e ..and i swear its the kewlest section !!! we spam like crazy and i love it :) i mean we have had 200 mails in a 2 hr DMOP class, 2 am poetry competitions, a dunk ____ campaign, and hoax mails on just abt everythg from water on mars to kingfisher calender !! the CP is our section is gud ..we have had some gems tht i willl possibly share with u later and yes i think we are the only section that conducts in session polls..ie the class is on..the professor is explaining conjoint analysis and my neighbour passes me a sheet stating - poll of the day -- who is going to start snoring in class today . option 1 , 2 , 3 or 4. i check around to see all the nominees ..needless to say they are inches away from their afty siesta and after much deliberation i put a tick next to my fren's name and then dutifully pass the sheet along ..let me add we all take our voting rights seriously including the TAs. :) last poll list was passed to the TA too

oh that reminds me i didnt mention the sleeping cell of E ..there are a few famous ppl in our section..famous for their ability to fall asleep during all sessions and still get straight As.. thats the sleeper cell ..no i am not a permanent member of the cell (i aspire to be but thats for another day) rather i am the life time member of the Arbit CP (class participation) club..they have put me in the last row at the rightmost corner - the worst place for CP (the prof never sees u) but i am on to them..down but not out..thats the motto here :)

my study group is a unique first at ISB three girls and a guy! so u can imagine :) and no hes NOT having a gud time trust me :D

the markstrat world (for the uninitiated - just know its a simulation we play in marketing class that makes us want to hunt down our competition and beat the crap out of them ) is one thg u will encounter in the second term and let me tell u nomatter what u do ..u will either be screwed by the competition or by the customers ..heard at a markstart meeting :

she says : our product didnt sell
he says : why
she says : it turns out our customers were braindead irrational morons who commited mass suicide!! (translation : no units sold, huge inventory on hand)
he says: oh that explains it ...i thot maybe we took a wrong mktg decision somewhere
:)

i think i have rambled enuff for the day..if u r still reading this ..i just have one question
WHY? :)

btw i heard piece of gud news today after a really long time ..am going to be involved in a very unique project at ISB..really excited abt that but have been asked not to talk abt it so will share it with both of u (the 2 who r still reading this ) later :)

on another note i want to thk a special person in my life who really helped me thru some stuff today..thx dude.. appreciate it big time :)

chalo

more arbit stuff later :)
take care
ciao

Term 1 Ends !!! - 12.5% MBAs

Term 1 ended 5 min back with the completion of the marketing term exam.

The enlightening, rollercoaster ride through Managerial Economics, Financial Accounting, Statistics and Marketing Management comes to an end. And boy what a ride it has been, the first term at ISB, so much gyan coming from all directions, so much to learn, so much to cope up with , lots of unlearning and lots of ego bashing and humbling.

The back to school experience has been both unnerving and fun. Now its time to take stock of the situation, plan our strategies for remaining terms(hoping that we have understood a bit of how ISB works) and to party and celebrate this success of living thru term 1 .

cheers,
--Badri--

Its raining! LRC and Above

Its raining, all sorts!
mid terms have barely gotten over, marketing case study, class quizzes, elections, club meets, industry visits! Damn! Its rain of sorts!

Tired of the above rain, I was secretly wishing to get an escape route! and...Guess what! Half hour back it rained for the first time for Class of '09 here! The original inhabitants of the campus, read the wrigly, jumpy creatures must be having a rollicking time out there playing in water after surviving soaring temperatures here.

The oh-so-drenching 'rains' have taken us all by a storm! Most of us have lost track of time and space and living from assignment to quiz to exam. Time is literally flowing on campus here. It seems like the O-week ( orientation week) was ages ago! Imagine, mid terms have gotten over just now and I realize that end of term one is just 15 days away!

PS: If you are still under the impression that the topic hints something on LRC: the learning resource centre, Dude, chillax ! you been studying too much, it's left, right and centre!

PS2: Oops, gotta sleep, Eco class is exactly 5 hrs from now!

Exams Ache Hain

2 Mid term exams got over today. I am back to my room after experiencing a severe bout of happiness after the exams. You should have seen the crowd outside "The Cafe". Everybody was smiling, joking, laughing and enjoying. At the risk of being labeled as a spoilsport, I felt that people were behaving as if they have achieved something great. But I must say that the happiness was well earned and deserved. Tomorrow is Accounting mid term, but i don't feel like studying, neither do i feel like sleeping. So what's the next best thing to do? Blogging.

Have you seen that Surf Excel advertisement, "Daag Ache hain". I liked the tag line and it has nothing to do with the marketing course that i am doing currently. The Tag line goes something like this, "Agar Daag lagne se kuch acha hota hai to fir daag ache hain". Translated to the context here, it means that if something good can be derived from the exams then exams are good. Today the mid term exams of Statistics and Managerial Economics got over. Everybody was so tensed before the exams. The tension and the stress was palpable. You should have seen the students last night and in the morning today. Everybody was frantically going through the notes, discussing abstruse concepts with others, and swearing at the system that made them slog like anything. And the atmosphere in the evening was starkly different. You could feel the joy and happiness in the air. You could see people indulging in harmless banter and endless chat. Plumes of nicotine smoke and tonnes of caffeine. What made the difference? The pressure and stress was off. Everybody was relieved that in the end its over. Nobody was worried about the performance, since that hardly mattered. Everybody was collectively extremely happy. I could bet that the average happiness quotient had gone up by several notches today. People were never so happy, after joining ISB. I felt like asking Xenobia "I feel so happy, Am I normal?"

So if the aftermath of exams results in increased happiness and joy then I would reckon that exams are good. It was like our Economics professor, Amit Bubna, would say "Nirvana". Don't label me as a jingoist, but I felt today that exams are good and they help in increasing the net happiness quotient of the batch. Everybody was emoting, "Dude, its over". Did anybody say that the Marketing Case study submission is due for Tuesday and Statistics Quiz is there on Tuesday too. But for now, let me sleep for an hour before hitting the books again :(.

A BIG SPLASH is planned for tomorrow night. The mid terms end tomorrow. People will celebrate and party like anything, coz they have survived 1/16 of the MBA course ( half of the term and there are 8 terms, Math is easy guys). I just can't wait for tomorrow evening.

BRING IT ON BABY.

Network,Network and Network!

With modern business practices into play, I have come to realize how effective it is to have a large network and a social following. To build a large social or a business network one has to effectively communicate and converse. The Persian poet Hafiz in describing conversation once said,"Most speaking really say, I am hungry to know you”. That little exchange in the lunch room, those fine pleasantry exchanges on the alleys adds much value and gives me the much needed zest to kickstart my day.

Sometimes I feel really down on days when I have been bogged down by study and not had that chance conversation with someone. I believe it is the inert nature of humans to connect with each other as social beings that makes them tick. This is also empirically and statistically backed by results that show the happiest man is one who is socially supported by both his family and circle of friends.

My life in Sydney for the last few years has certainly nurtured in me the importance of strong business networks to thrive in corporate life. In a corporate life it takes tremendous guts to walk up to a stranger and strike a conversation.What if this conversation opens doors to a brighter future or to a pathway for a business proposition?

It is really hard to break off that comfort zone, but out of the circle is where opportunities exist. If one is not an extrovert by nature, networking and conversations can be certainly graced by sheer practice. There is nothing in this world that cannot be learnt by application and effort.

Often plain conversation over coffee on a lazy weekend is an amazing experience where you simply swap pleasantries with the other person over much laughter and intense listening. I am reminded of the ad which is centered on the theme “Much can happen over coffee”. People have this potent to simply reciprocate the way you treat and give it to them. When you expose yourself with fine details over conversation that is when you simply connect with the other person, in turn inducing her to reciprocate. One of my friends in depicting conversation wrote in the Columbia University student rag “Conversation is not about the prefunctory hello, but that sparkle with teeth shown and eyes lit up”.
ISB is certainly the place to build this massive network and I firmly believe thats the reason we are here at a B-school. A picture insert here of my team at the Dumb-C last weekend-man it was so much fun and laughter we shared-Thanks Guys!

Its been a month!!!

April 12th 2008, we set foot at ISB and then commenced our PGP in Management. Its May 12th 2008 today and at the risk of quoting a cliche "time just flew" , It was hectic, It was demanding, It was fun, It was puzzling, it was interesting but whatever it was we have conquered this last one month and its now behind us. I hope the remaining 11 months fly this way too.

Cheers,
--Badri--

Operation Rescue Dolphin

Contributed by Nalin:

I was working in oilfield 20 Miles offshore of Abidjan, Ivory Coast. A triad of one FPSO (Ship with production and storage of oil) and two Oil platforms made up for production of 35,000 BBls of Oil every day. I was stationed at the ship as Head of Marine and Safety department. On the afternoon of 16th November’07, we had a SOS call from our Oil Platform, 1 Mile East of us, that one Dolphin has got tied herself up in a fishing line and even after struggling for more than 2 hours has the line all around her nose.

Taking two guys, I lowered the rescue boat and we went on the mission 'Save Dolphin'. Since rescue boat is very low in height our view and horizon was very limited, however as we approached East Tower we were helped by the people on the platform, who were at a vantage position due to height. Every one was showing us the Dolphin's location and hurling us strategies to rescue her. Despite loosing our boat hook, bringing in a new gripper (with weight and a long line) and all the sincere advice from East tower operators, Dolphin eluded us. We still could not catch her because every time we used to go close to her she used to dive deep into the water clear of the rope and hook we were trying to pull her with.

So it was time to take the tough decision; to call the experts i.e. Fisher man. Now this was a catch 22 situation. We always shooo away the fisherman whenever they approach within the 500m zone of our territory however now we were inviting them only 20 metres from the East Platform.

We could spot a fishing boat 1Mile away from East tower. Swallowing my pride and ethics, I decided to call them for this (Dolphinitariun) gesture and we caught up with them. Thanks to expertise in French language, of Sr. Cargo operator Ouattara and GPO Silla we convinced them to help us 'release the dolphin' and brought them to the site of rescue.

It took fisherman about half an hour before they were able to fish out the 6 feet long dolphin from the water. Poor creature's nose was badly cut with the fishing line; several other fine cuts could be seen on her body. I am not a mind reader but for sure Dolphin must have thought "Here I go, let me say my last prayer to lord Neptune". Between claps and cheers all around on east Tower and our rescue boat we released the Dolphin who slipped away from the fisherman, dived and swam away.

Pity we didn't see her flip.

Lessons learned:
1. Our line was made of polypropylene, which floats in the water, hence didn't allowed the sinker to go down deep enough to catch the fishing line around dolphins nose.
2. There are no permanent allies or adversaries; there are only permanent interests! So embrace the adversary if the situation warrants and it is to our advantage.

Lesson to learn:

1. We went there to help the Dolphin, but she was suspicious of our intentions hence we could not help her as much as we wanted to. Similarly in our daily life how many times someone tries to reach out to us however due to either preconceived notions or cultural differences we are not sure of others intention and we can not make that connection. Is there any approach we can take to avoid this dilemma?

Matter of the grub

Like I mentioned in one of my previous posts the food here will not win any culinary competition anywhere. I miss my fish & a whole lot of other good stuff. Last night as we were having biriyani outside (pretty good, I must say) I was thinking back to the food scene back in Delhi. Now anybody who's been in Delhi knows that Delhi rocks in terms of food.



Admitted there are lot of traditional goodies which I have not tried out - kulfi, chaats etc. I have not been to Chandni Chowk, Parathewala Gali or other such places. But I have been to some good places some of which both me & Mousumi ended up being quite 'fida' about.

• Italian at Flavors - There is something quaint in this place. It's our favourite joint in the city. Sitting outside beside the lawn, the general confusion in the service & the fab food. We've gone here umpteen times during the close to 4 yrs we've stayed together in Delhi.


• Chinese at Oriental Bloom/Mainland China/China Club - All there are great places. Mainland China is the most affordable while Oriental Bloom has the most amazing dimsums I've ever had.


• Spanish at Sevilla's - Ooh la la....what a setting & what great food. Very steep on the pocket. I would definitely recommend this for celebrating a special night.


• Bengali at Oh Calcutta - Food which went out of vogue with grandmothers. Traditional delicacies which these days you only may get to taste at weddings. Intricate cuisine which me & Mousumi will probably never be able to cook. Go here to find out why Bengali cuisine is probably the best cuisine in the country.

Food wise Hyderabad is also quite hep. The only problem is that the city is a distance away & it's not feasible to go there all the time. But we shall endure....& wait for our first royal meal at the City of Nizams. Till then I can

1.5% MBA and already scared!!!

5 days out of our 357 day course ends today and I am sure i speak for everyone when i say there are been a Gyan overload. The environment here is exuberant, the alums are all pumped up in helping us settle down, giving us gyan, my batchmates are full of ideas and everyone wants to come up with something new of their own.

I am sure if i had a machine that could detect ideas I would find several floating in the air. But with all due respect to my team I must mention though that there is a slight ego/selfish tint to all that is done here and that really cant be denied. But who said we came here to be saints, we came here to be leaders , and most leaders if not all start with a selfish outlook and once they settle into social service become selfless(or less selfish)

Managing time, getting up early in the morning, participating in all the activites and above all that remembering everyones name, address and X-occupation is very demanding. I am a bit scared how the load and time constraints will be once the course starts in full swing, afterall as yet its only orientation thats in progress.

--Badri--

And the journey begins!!!

Is it normal that I am shaken cold?

When I am passed this important baton to hold

Some are born great, Some achieve greatness

But seems the ISBian tag upon me has thrust greatness

But is becoming an ISBian in its own right glory

Or is glory, were I will get if I don’t make ISB sorry.

Hopes of many vested on me

While my own goals, clearly, I am yet to see

I am told this journey might hurt, sometimes I might even hit dirt,

But only if I fight with tremendous success I can flirt,

Now having heard that I am scared to enter, leaving my comfort zone

But then I am promised, me as a person this place will hone

But before I begin this journey its time now for goodbyes

Its corny, sad and there are some drops of tears in my eyes

Oh, near and dear, wait a year and I will be back

In the mean time, God willing, records at ISB and history I will crack.

--Badri--

Finally... The wait is over

It has been more than three months since many of us got THE mail from ISB. Since then I have been itching to get started with life@ISB. However, the interim period has been anything but drab.

The first two months were work, work and some more work! It was a brutal stretch at office where people were keen on sucking every ounce of the juice of life from me before I departed. Nevertheless, I not only survived the ordeal but also came out of it a full month before my scheduled release date! That meant that I had the whole of March at my disposal.

After leaving work, I too took off on a pan-India trip visiting new places and meeting old friends. Be it the white water rafting in Rishikesh or the trek into the mountains in Mussourie, there is a lot of fun in travelling without any plan and just enjoying anything that you find appealing. Of course, I have not been as diligent as Dushyant in capturing and sharing the sights. (@Dushyant: Really cool pictures buddy) The holidays also gave me a chance to catch up with old friends, some of whom I had not seen for almost a decade! Spent quite a few evenings lost in nostalgia reminiscing the good ol' days. The entire trip took about 25 days but each and every minute was worth it. Rarely does one get so much time to just travel and explore places without a care in the world. It was a liberating experience and it definitely did “recharge” my batteries J

The action did not stop on the ISB front as well. I used to think that giving GMAT and getting into ISB was tough. How completely wrong I was!! For the poor souls who decided to bank with SBI, the last month and a half has been nothing less that a soap opera with all its twists and turns. Compared to this the GMAT and ISB application seem to be a cake walk. From the dreaded loan application form and the affidavit in the initial application to the PDCs, another Affidavit and all the signatures needed in the post approval formalities. The entire procedure has been a farce and it really showed the government institution in all its ugly glory. Without the help of a few kind hearted souls like Natarajan, I do not know how we would have successfully navigated the labyrinth that is the SBI loan procedure!

Anyways, the wait is finally over now as we have less than a week’s time before starting off what I believe is going to be a truly amazing year. At this point, my mental state is akin to that of a little kid, who, candy in hand, has been standing in the long queue for the roller coaster ride and now that he is at the front of the queue, is all excited to finally take the plunge.

Ladies and Gentlemen, Fasten your seatbelts.

Its Showtime!!!

Kashmir - Paradise on Earth

Chicken Soup for the Taxed Soul

Each and every tax that the government imposes, gets collected, in the very end, from a person's profits. So, why not scrap all the taxes and levy just a single one, to be directly collected, once a year, from the end profits of the person?

(Guys, I'm NOT trying to be sarcastic or funny here. I got this idea sometime back and am asking you this question earnestly.)

A Failure of First Principles

Yet another post to add to the posts about the credit crisis. Although I don't work for a bank, I think the current credit crisis shows all the symptoms of a failure to follow sane and conservative banking principles. The reasons for the crisis described in this post, although not exhaustive, are an attempt to examine the problem from the point of view of a banking institution/lender issuing credit in highly speculative markets.

What happened - A Look at the Balance Sheet

The events leading to the credit crunch are common knowledge now. But, how do these events pan out in a banking institution's financial statements? Consider that I'm a bank/lender who offers a long term loan to a creditor. On my bank's balance sheet, such a loan would appear as an investment on which I receive yearly interest and am liable to receive principal over the payment period. Considering this is a long term investment, the debtor assures me he will back up this loan in case of default with an asset - in this case, his house. Mortgage backed securities is a term being thrown around for this kind of an 'IOU'. Such assets appreciated in price disproportionately with their real value because of speculative buying and selling of such securities. When the asset prices drop drastically due to such reasons, the effect on the balance sheet is disastrous. An investment in a secured loan, say $ 1.5 million, is now defunct and the only way to retrieve this investment is by taking possession of the asset backing that loan. However, the asset is now only worth $ 1 million, resulting in a $0.5 million write-off (bad debts) for the bank. In the event that a bank has invested a large portion of its credit in such markets, the write-offs are a major portion of its investments and we'll see a Bear Stearns.

Where did they go wrong - What can we learn ?

a. Risk Profiling and Credit Structuring

Lending in highly speculative markets has the uncharacteristic effect of making some banking institutions relax. Banks that are suffering or likely to suffer are most likely the ones who :

• Did not intelligently profile the risk involved in lending major portions of their credit in a speculative environment. Asset prices have seen a sharp and unrealistic rise and such volatility does not last long term (more on speculation later) in which case banks underestimated their risks. Or overestimated their gains.
  
• Did not responsibly structure their lending portfolios to diversify into stable markets, prone to less speculation. One of the first rules of investment - even in mutual funds or stocks - is to have a broad and diverse portfolio. Financial analysts examining this issue point out to the irresponsibility with which banks which are liable to go down have invested in unstable markets. If such banks had a foundation of stable portfolios from markets such as pharma, infrastructure and health services where speculation is less likely to influence your investment, there would have been a better chance of living to fight another day. It's a sad case of poor structuring where your most risky investments make up a major fraction of your credit.

b. Know where your debtor is coming from

A bank that fails to examine the credit-worthiness of a prospective debtor fails to do its job. One does not need to elaborate on this, except for the fact that a highly 'positive' market tends to build on euphoria and kill rationale in decision making.

c. Know where your money goes

A lot of people talk about complex securities and inter-linked securities. People complain that banks that had mortgage backed securities ended up using such securities to cover their own from their own creditors. What I do know is that when a bank which first does not analyze its risk on an investment properly, then passes on the risk on such an investment to gullible creditors has only compounded the sin. Creditors who did not realistically analyze the risk behind such securities were partially to blame. The solution is to hold banks accountable for the securities they market and tie these to a specific asset - which when assessed independently - can be shown to be overpriced or volatile.

Judging from some of these decisions, I believe the current crisis is a result of poor financing decisions, the principles of which have been lost in the illusion of short-term gains. The answer to this crisis does not lie in drastic measures but in a return to the forgotten first principles in banking

And now to touch upon speculation :

Speculation - Is it really that bad ?

It has been pointed out that the root cause of all this mess is a highly speculative environment. Hence instead of just regulating banking institutions, regulate speculation as well. I tend to disagree with this line of thought for a couple of reasons:

Suppose a product is scarce in the market and yet reasonably in demand. The price for such a product is high but expected to go higher due to the scarcity value and demand. A speculator, seeing the future potential of profiting from the sale of this product, comes to town and buys large quantities of this product at existing prices. This speculative buying pushes the product price even higher to a point where some consumers forego the purchase of the product. In other words, demand/consumption reduces by way of speculative buying. Secondly, when prices are higher than speculators like, they sell. This reduces prices and encourages consumption.

The bottom line here is : The short-term volatility in prices ends up regulating prices faster.

Speculators also tend to invigorate markets which do not have enough liquidity. A product that is low in demand will have a big disparity between the price a new entrant to the market is willing to pay and the asking price. A speculator, in conjunction with competing speculators, tends to reduce this disparity and create a more efficient market.

Regulating speculation for fixed periods of time (due to the above reasons) can also have the undesirable effect of prices changing with a huge lag with respect to demand and supply. The time lag will create more inefficient markets.

I believe one needs to think of addressing a major malady in the system - the folly of predatory lending and abuse of banking principles - which will come with more financial regulation. Such efforts will ensure greater robustness against volatility in secured lending than shooting small birds.

It’s strictly business

As the famous lines in “The God Father” go, it is very important to demarcate between personal and business issues. Let me cite Michael Corleone's words “It's not personal…. It’s strictly business”.

Like many, I was a keen follower of Mergers & Acquisitions which took place over the last few years. I am very impressed by the scale of acquisitions taking place across various verticals in the industry. I believe, owing to several factors, many industry verticals (irrespective of how mature they are) are going through a consolidation phase. In every industry, this phase is bound to happen at one time or the other.

I was also following the JLR (Jaguar-Land Rover) deal which the Tata Motors won. I am glad that Tata’s can use their expertise in turning around unprofitable businesses to turn around two iconic British brands. Like many, I too have my own concerns. Considering the portfolio of Tata Motors, terms of the deal etc, can Tata’s turn around these businesses. On the positive side, this deal could potentially make Tata Motors a “one stop” for car enthusiasts. Also, a typical customer could start with a Nano, upgrade to Indica/Indigo/Palio few years later and could upgrade to some high end model (Range Rover, X* series in Jaguar) when he/she could afford. So, a customer could purchase his first car and his last car with Tata Motors, provided that the customer is extremely satisfied by the service received from Tata Motors. Not to forget, the international market Tata Motors would be targeting with JLR. Of course, all this requires lot of effort and planning on behalf of Tata Motors.

I came across a post on JLR deal in BusinessWeek and it is worth motioning. For the post, click here

While this post is a very good write up on JLR deal, I would say I am disappointed by the comments section. After I read the comments, for a while, I really had second thoughts on free e-media. The context of the post is lost just in the first few comments and it looks as if the comments turned out to be arguments. Phew! (Few comments reminded me of dialogues in Rajnikanth's movie).

After I read the comments, I am all the more puzzled due to several questions that ringed in my mind. They are:

1) In this globalized world, how fair are the words “Indian (any country for that matter) Company”

2) What does it take for a company to be called an Indian company? Do the founders need to be Indian? Do the majority of operations focus on India? Do majority of share holders need to be Indian? Do all the share holders need to be Indian? Do the CEO and majority of the management team need to be Indian? Should the company be funded by Indian government and the company be responsible to the cabinet?

3) When Tata signing JRL deal can be compared to the victory/domination of Indian businesses over British businesses, what does Vodafone’s purchase of majority stake in Hutch signify?

4) Does the fact that every body is using electric bulb signifies the power of American innovation over ignorant rest-of-the-world.

All such comparison with foreign institutions and brands does no good to organizations and brands emerging out of India. Instead of focusing on differences, I think one should focus on common strengths and spread globalization to every corner of the world enriching people. At a time when Indians (including me) need to educate the rest of the world about India’s rich and diverse culture, all this rant and unnecessary comparison makes the task much more difficult.

By the way, congratulations to Tata Motors for sealing the deal. The real deal (turning the two brands around) starts NOW.

P.S: I have created a poll on my blog. You can express your opinion on the Tata-JLR deal by casting your vote @ http://vijaybhaskarvbc.blogspot.com

The Problem with the World Markets and How to solve it

“Yet another article related to the credit crisis? Noooooooooo… I can’t take it anymore! Have I not read, heard, seen, discussed, analysed, reanalysed the issue enough already? Then why do I need to go through another insanely long piece of shit discussing the same damn thing?”

If that was your first reaction upon reading the title of this post, then, well, I can understand your frustration. I too have begun to cringe at the sight of the words “crises” and “credit”, especially when they appear together. I have waded through seas of articles on the subject, which all seem to say the same thing, and at the same time, nothing at all. Most articles attempt at explaining the root cause of the problem. They don’t do a good job of it. Some try to propose solutions. They don’t do a good job of it either. With the exception of just a single article, by The Economist, none of the articles come even close to understanding the crux of the problem. But, unfortunately, the article by The Economist does not propose any solutions for the problem.

So, here’s my take on the REAL problem in today’s markets and the solution for the same. It’s kinda radical, so don’t hate me if you don’t agree with me. Nevertheless, I think you’ll at least have fun reading it. Well then, here it goes…

The price of something depends on 2 things, viz. demand and supply. (“Dude! What a radical proposal! I wonder if someone can get more radical than this!”) In a market where there are only 2 kinds of participants, viz. pure sellers and pure buyers (pure sellers are those sellers that are selling “something” that they themselves have “produced” and have not simply bought it from someone else, while pure buyers are those buyers that will use that “something” for their own consumption and not sell it further), change in the price of the product will reflect real supply-demand disparity, given that other conditions are near the conditions of perfect competition. For example, if we consider the entire supply chain as one “seller”, then a multiplex selling movie tickets is a pure seller and movie-goers buying them are pure buyers. For ease of understanding, if other factors show tendencies as in the state of perfect competition, the price of the movie tickets would rise if the demand rises relative to supply and would fall in the contrary case. So far so good.

But what if the sellers and buyers in a market are not of a pure nature? What if anybody and everybody, regardless of the consideration that whether he has produced the product or not or is the end consumer of the product or not, is allowed to buy and sell those products? What will be his motivation to participate in the market? To answer these questions, let’s bring back our example of multiplexes and movie tickets.

Let’s say that a movie is scheduled to be released on 1st January 2009. The producers decide to start selling its tickets from today itself. Nobody buys the tickets because the movie’s release date is far away. But, after a few days, suddenly the movie becomes extremely controversial. Almost everybody comes to know about the movie and gets really interested in watching it when it releases. They still don’t buy the tickets because the release date is far away. But a few smart people, realising that people will give anything to watch this movie when it releases, buy the tickets by the truckloads. Their calculation is that they’ll sell these tickets at the time of release at a higher price and earn fat margins out of it. A few days later, there are rumours that the movie might be shelved. So the guys who bought the tickets by the truckloads start selling them to other people who think that there are still chances that the movie may be released. As various positive and negative news keep coming out about the movie, such trading keeps happening and the price of the movie-tickets keeps going up and down.

Far fetched as the above example may seem, it summarises the way in which all “investment” markets function. The motivation of an individual or an entity, which is not a pure seller or a pure buyer, to participate in a market, is to simply profit by buying at a low price and selling at a higher price. He has no concern with the inherent value of the investment, only with its price movement. And herein lays the problem: speculation.

To be sure, in any investment market, the initial change in direction of prices, whether upwards or downwards, happens due to solid reasons. For example, when the Indian stock markets started rising in March 2003, it was because of real factors, such as the country’s growth potential in the near future. At this point of the cycle, people who understand the fundamentals of the market, and the companies, invest in them because they can see real corporate growth in the future. The question being asked at this stage is, “Will this company perform well in the future or not?” The change in prices at this stage is slow and steady. As the markets keep rising and start delivering good returns to its investors, they start attracting a lot of publicity. When others see that a few people are minting money by investing in a market, they naturally feel like getting their piece of the pie too. From this point on, most of the money that comes into the market is speculative. The question that is being asked at this stage changes to, “Will the price of this share/ commodity/ property go up or not?” The change in prices at this stage is extreme and volatile. (I have seen, with my very eyes, the share price of a company named Reliance Natural Resources Limited rise by 41% in a span of 5 and a half hours! And that too without any announcement by the company that could have greatly affected its future profitability.) This is the stage when newspaper headlines scream about new milestones reached and new peaks conquered. Insane predictions of future growth start flowing in (like an article published only a few months ago, proclaiming that the Sensex will reach 50,000 points by the end of 2008). But, at some point, the direction changes. First, the people who understand the fundamentals of the market, start selling their assets as they come to realise that the speculative boom will not last any longer. Prices fall as they make their selling. And then the entire cycle plays itself in the reverse, until the prices in the market have reached insanely low levels.

Each and every boom and bust cycle in each and every investment market can be explained by this hypothesis. Speculation consecutively plays the hero’s role and then the villain’s role in each of the stories. One may pick up any boom and bust cycle from the past century and it will display the above characteristics. The Indian stock-market boom of the early 90s, the dotcom bubble at the turn of the millennium, and the recent US real estate boom, which is the real culprit behind the subprime mortgage crises and the ensuing credit crises, are some of the examples from recent decades.

Economic theory says that markets will be extremely efficient at price discovery when there are a large number of participants, among other things. Today’s investment markets definitely have a large number of participants, if nothing else. So why are they not efficient at their price discovery? Why do we CONSTANTLY see such anomalies as stock prices rising by 41% in a span of 5 and a half hour, without any apparent reason? That’s because there is a fundamental flaw in the economic theory and thus in the markets that have been designed on its basis.

The economic theory of efficient price discovery in a market holds true only when the participants of the market are pure sellers and pure buyers. This is because it assumes buyers and sellers to be 2 mutually exclusive sets and does not consider the possibility that buyers may themselves want to become sellers once they acquire the products. So, when non-pure sellers and buyers enter the market, the economic theory breaks down and efficient price discovery becomes a dream. This is the root cause of the problem plaguing the world’s investment markets. (The current unprecedented boom in the commodity markets of the world seems to be a result of the same phenomenon. Let’s wait and watch how it turns out to be.)

Thus, the solution to the problem is quite simple. Keep the non-pure sellers and buyers out of markets. This means that only those market participants that actually “produce” and “consume” the objects offered in a market, should be allowed to participate in it.

Implementing this solution is easier than it seems. We do not need to check the background of, and approve licenses to, each and every individual and entity that wants to participate in a particular market. That’ll be a bureaucratic nightmare. We simply need to introduce 3 conditions for participating in a given market:

1. Buying an item from a market, should always result in an ACTUAL delivery of that item to the buyer.

2. All the derivatives of a given market that do not result in an ACTUAL delivery of the underlying asset should be removed from the market.

3. A MINIMUM lock-in period should be imposed, before the buyer is allowed to sell his purchased item in the market.

The third condition is a crucial one. For example, if the lock-in period in the stock markets is 1 year then only those individuals and entities who think that a particular company will perform well over the next year will buy that company’s shares, thus removing speculation from stock markets. In the case of the property market, such a lock-in period will be longer, perhaps 10 years.

The above 3 rules will ensure that the only market participants are the ones that are pure sellers and buyers and not speculators. This will not only lead to efficient price discovery in markets, but it will also drastically reduce the occurrence of boom and bust cycles that are an inevitable part of a speculative market.

Jooce

Check out this BusinessWeek article on a new path-breaking service: http://www.businessweek.com/globalbiz/content/mar2008/gb20080325_844094.htm?chan=top+news_top+news+index_global+business.

And check out the path-breaking service itself at http://www.jooce.com/.

For the love of Office Emails

Most of us would have resigned from our present workplaces by now! I did the same recently. Now, I belong to that breed of people who love to save/keep e-mails on office email ids saved. For this purpose, people usually take the backup of mails by copying the NSF file for Lotus notes or PST file for Outlook or Thunderbird Local folders and then keep them in hard disk somewhere and forget it later.

That defeats the whole purpose and is like keeping them away trashed and would not be of much help.
Enter Google again to my rescue!
We can upload all important (personal) communication on office email id to a new google account!

Google recently launched IMAP access of their mail
http://mail.google.com/support/bin/answer.py?hl=en&answer=75725
with its help, I can configure Thunderbird or any other email client I use at Office to make a new email connection, this time to a gmail account

Just follow these steps:
1. Create a new google account and enable its IMAP access ( Enable IMAP in the settings link on top right hand side)
2. In the Local Email Client at your office, go to the menu where you can Add a new account
and Create and Configure the New Google IMAP account as per the instructions in this page:
http://mail.google.com/support/bin/answer.py?hl=en&answer=75725

3. Now you should have two accounts listed in your email client say thunderbird. Now, just just drag and drop emails from office email account in thunderbird to google imap a/c in thunderbird

Do the third step taking mail size and speed of internet at your place in consideration Or the email client may seem to hang. I suggest moving mails to google account in chunks of 50 each.


Let me know of any queries !
-AJ

Bear Sterns Bail Out

To start with little history, Bear Sterns is a financial giant with 80 + years of experience in financial world. This company withstood The Great Depression, the stagflation of the 70s, the dot-com burst but succumbed to the subprime mortgage crisis.

Now what is subprime mortgage crisis?

Subprime mortgage crisis is sudden increase in foreclosures by home owners.

Now, who are “these” home owners and what is foreclosure?

These home owners are people with not so good (less than generally accepted) credit rating and ended up taking home loans with higher interest rate. Subprime loans provide an opportunity for borrowers with less than "not so good" credit rating to access loans at higher interest rates.

With the real estate prices’ increasing continuously, the lure of hedging on homes is too good to resist. Even if the lure is not good enough to entice people to buy homes at high prices, the fear that “if not today, I may never be able to buy a home in this ever rising real estate market” could also be a significant reason.

Let’s look at an example:

A person XYZ takes a loan at higher interest rate (subprime rate) when the real estate prices are sky high with the hope of refinancing at a low interest rates. If XYZ does not have good credit rating, he/she is not entitled to loans at attractive interest rates. However, XYZ can improve his/her credit rating by paying EMIs on time for one year. The problem arises when XYZ cannot pay as planned. The credit rating worsens and the chances of refinancing at lower interest rates are minimal. To add to the problems, if the real estate prices collapse in the midst of all this, XYZ is in real soup now. XYZ took a loan at higher interest rate when the home is valued at a higher price. Now, the home is not valued at the rates for which it was paid for. That means, XYZ is paying more than the current value of the property and he/she is not financially sound enough to manage this. So, XYZ chooses to foreclose the property. When this happens on a bigger scale, boooom, crisis starts.

So, how did a company which was awarded “Most Admired” securities firm in Fortune’s "America's Most Admired Companies" survey get involved in all this? Bear Sterns invested heavily in hedge funds that lost almost all of its value because of subprime mortgage crisis. One thing led to the other and finally, the share which was valued at 87 USD during the last week of February 08 is offered 2 USD on 14/15^th of March 08 by JP Morgan Chase. The firm whose net income during the previous year was 2.1 billion USD (source: http://www.businessweek.com/bw50/2007/74.htm) was purchased 236.2 million USD. That’s how quick fortune changes. One of my colleagues was talking about an English guy who holds 10% in Bear Sterns. Man, that guy would have wept his heart out after all this. I even came to know that few employees of Bear Sterns who hold stock options could not control their emotions during all this mess. After all, we are all human.

However, If one looks at the bigger picture, I think this is all part of economical cycle. Not everybody would get rich all the time. Few get rich, few get richer and this might mean few getting poorer. It’s all in the game. Mankind has seen many financial collapses like this in the past for different reasons though; many of which we don’t even remember vividly (For those who forgot, remember, there was a much bigger financial collapse just few years back. Does ENRON sound familiar?). The collapse of ENRON had far reaching consequences than the collapse of Bear Sterns. A typical investor in Bear Sterns is much richer than a typical investor in ENRON. Also, it is not as difficult to find another job for employees of Bear Sterns as it was for employees (most of them not highly skilled) of ENRON.

My point here is: We should all look at the bigger picture and not panic when a blip takes place in the economy. An economy is not bound to grow unprecedented. It is bound to have recessions. We should not loose confidence and rather work towards a better tomorrow and a brighter future.

DISCLAIMER: The contents of this blog are strictly my personal opinions and not those of any organization/institution I am a part of, nor made in any official capacity of such organization/institution unless expressly stated otherwise and where I am explicitly authorized to do so.

Web2.0 Startups –Indian Edition

Having a candid conversation with a friend the other day, I realized he was quitting his prestigious job at Credit Suisse NY to move back to India to materialize his dotcom dream.

What is that the Web can do for you? In this Web second edition what is otherwise known as the Web 2.0, there are certainly clear winners (lets call them Flickr, Facebook and Utube) with great potential for future revenues even though their profitability or business model is still being questioned very much. Some of my friends seem to have gone absolutely head over heels crazy for this Web stardom, not that I have not! They have tread another step further and left their secure jobs in the biggest cities around the globe to have their own web startup in India after listening to that inner voice deep down. I firmly believe one of them is surely going to do a Sabeer Bhatia or a Larry Page flick very soon. How good it is to be Mark Zuckerberg, the Harvard educated wiz kid who started Facebook only to realize i its now worth close to $750 million?

One should not forget the fact that many startups that go belly up for every Facebook or Google to emerge. It is very confounding at times to note how startups survive the initial hiccups and have different approaches to profit route. Well, after the initial thrust, one has to certainly look out for a model to channel in some kind of profits rather than just run the footnote Google ads.

But, I have been so enticed recently to the world of Dot.com every since Nokia, the company that I work for completely changed the corporate structure as a Dotcom company and acquired Ovi.com and twango.com Even the grand old Rupert Murdoch, believes the dotcom is the way of the future for News Corp,proving it with his recent online shopping of myspace.com.

The question now is how far can we stretch this Web, going forward?

Given the fact there are going to be some real smart bodies at ISB, it will be exciting to swap ideas looking towards a venture. www.lootstreet.com is a new startup that gained sufficient media attention just because it was by IIM grads, even the home page proudly paints the IIM story. I am very sure ISB too has big ones coming in the class of 2009. Some of the Indian startups I will be watching closely some exciting ones here in the near future

www.loandukaan.com

www.aisapaisa.com

www.lootstreet.com

North East - The last two days

Well - the last two days were definitely worth the trip - also they helped turn this trip from 'hopeless' to 'good'. Went for a jeep safari on the first day and was able to get many great shots of rhinos, elephants, water-buffalos, hog-deers . . . . Was great fun. Of course the fun cannot always continue and had to "suffer" an afternoon of site-visits (which were supposed to be visits to tea-garden) with my friend. However on the whole - very nice. Few photos at the end.

Yesterday was great - I was finally alone - and realised that I actually love my company. Went for an early morning elephant safari (got up at 4:00 !!!) - interesting - but the jeep safari was better. Spent the rest of the day exploring the place - chilling out and all to soon the day was over.

More later .. . - have to catch my flight now.

North East Day 3-4: Never again . . .

Never again am I going to let someone else plan my trips.
The last two days have been absolutely useless. Yesterday was spent waiting for the ILP and then travelling to Tezpur (3 hour journey which took almost 6 hours) - where we were to board a night bus for Tawang (one of the oldest monasteries in India right next to the China border). It was all fine as long as there was something to look forward to. Then all hopes were dashed - there were no night buses / jeeps / bullock carts !! You can reach Tawang only by jeep and they leave only at 5.30 in the morning. Also it takes more that 12 hours to reach. So that meant wasting one day to go and one to come back - that left me with a night when I could stay there. Made no sense at all. Plan 2 was to go to an eco-camp for rafting -- seems that was too expensive - no idea how much though. Plan 3 was to go to Bomdila (supposedly 3 hours from Tezpur and supposedly very beautiful). So we opted for plan 3 - little did I know it would take 5 hours to reach - 1 hour for lunch and 5 hours to come back !!!
So I ended up spending 11 hours for lunch - that ought to be a record. Finally I took matters in my hand and decided to spend my last two days in Kaziranga and stop sitting in buses / jeeps for the rest of the trip. So I'm writing this from a beautiful resort in the middle of the jungle . . . .. . . Lets see how the rest of my trip goes . . And as my school motto goes "Never Give In" - I'm not going to lose hope and discard this trip as totally hopeless.
More tomorrow . . . . . . .

Of People and Technology

The Man or the Machine?Analyze this...

There is an organization called Dell Computers which "was" market-leader in the PC business.There is an organization called Toyota Motor Corp. which "is" a market-leader in the Automotive business and by-far the most profitable auto-maker in the world.While the former is panting for breath with the competition catching up with it (or otherwise), the latter is rolling like a juggernaut.

Why this uncanny comparison between two non-competing entities?The point is this...Both Dell and Toyota are names to swear-by when it comes to supply chain efficiencies.Both have pioneered such great processes by virtue of which they had the competition running for cover.
Direct model from Dell was such a brilliant strategy that it threw the likes of IBM out of Business.And contrary to the popular misconception, there is something that is actually perfect in this world and that's the Toyota Production System.

While Dell's innovation relied mostly on Technology, Toyota relied on its people.

Dell had almost everything going right (which is against the laws of nature).If everything is going right...something has to go wrong and wrong it went.The competition soon caught up with the Lenovos and the HPs quickly realizing the benefits of mimicking the Dell model and the whole competitive advantage of Dell is fast fading away.

On the other hand, Toyota has proved to the world that smart people come in small packages and are not too abundant.Inspite of the huge consulting assignments that Toyota has done with a number of American companies on its production system, the world is yet to see anything even close to Toyota.No complex softwares for inventory optimization and Production Planning for Toyota.Just an inclusive manpower and some excellent execution strategies at its perusal.

Technology is definitely something but man seems to be everything for he clearly, still, seems to be the Master!

Mom & Pop vs Supermarkets

I visited my friendly neighborhood panwaala, Ashok, after a long time today. I was just getting pally with him. He inquired about my absence, "Long time no see bhaiya", I told him that I had been living on my stock for sometime. I observed that:

He knows the choice of his customers and the moment they come, he digs out their brand in a flash.
He is an enterprising person and always greet me with a smile.
He is benevolent enough to give me loose change whenever I need them.
He is open from 6 AM to 11 PM.
He is diversifying, he stocks up groceries, water cans, ready to eat, phone booth and other sundry things.
He gives credit to lots of his customers.
He knows most of his customers by name and address.

That made me ponder over the onslaught of supermarkets and hypermarkets on these Mom and Pop stores (hereafter referred as M&P) that dot the Indian landscape. No doubt the ripple effects are being felt by these small unbranded grocery and retail outlets, but these M&P stores might just have an ace up their sleeves.

M&P have few advantages over the multi million square feet retail chains. M&P know their clientèle and their preferences. M&P know their terrain and have deep penetration. M&P can improvise upon and provide customized service (for example door to door delivery) to their clients. I remember having a chat with a senior client member, he pointed out that his wife still likes to buy fresh vegetables from the sabziwala who comes every morning. He reasoned out, that his sabziwala knows how much quantity is consumed and which vegetables are preferred by his family. That sums up the advantage that M&P might be having.

In India unorganized retail still accounts for over 90 percent of the retail market, but M&P are facing a constant and increased threat from organized retail chains. These retail chains bank on the seamless supply chain that they have built and also on the economies of scale. Till now Organized retail has appealed premium and high end customers. But it wont be long before no-frills retails chains on the lines of Subhiksha and others give M&P a tough fight for the turf.

But Ashok is unfazed, he knows that market is big enough for everybody to survive and innovation will be the key to the survival of M&P in the times to come.

North East Day 2: Guwahati Temples

Today was a day for temples - it seems Guwahati is called a city of temples - there are quite a few of them here.

First we went to the Arunachal Bhawan (found it after a loong search - as it is in a small house on the end of a smaller street) and applied for the ILP (In-Land Permit) which is required for going into Arunachal. If you don't want to "waste" a day in Guwahati - I would suggest that you get the ILP from Delhi or Mumbai. Anyways - I missed out on that option - and spent the day in Guwahati. 

As I said - a day for temples - Kamakshi Devi (the line was sooo looooooooong I didn't even think of going in) - Umananda (small temple on a river island - very nice place to go) - had lunch - and the Balaji temple (very beautiful South Indian temple - nicely landscaped - unfortunately my camera went crazy - the mirror got stuck and many photographs came half black :-((((( )

And last of all Kalakshetra - a nice park with a small museum and a big open-air theatre - very nice place. 

Well - that was the end of the second day - quite uneventful and not the best - but lets hope for the best - should get my ILP tomorrow - and then its off to Arunachal - Bomdila and Tawang - then Kaziranga. Lets see what else can go wrong. . .

It seems the North-east area hates my camera - last time I had come to Calcutta - and my SLR was stolen - this time - first I got fined for using the camera yesterday - and today the mirror got stuck - now till I can get it repaired I've lost the ability for auto-focus . . . . . but I guess things could be worse :-)

North East Day 1: Shillong

Reached Guwahati early in the morning and met up with my old friend - Nakul. Even though we had met after many years - it felt as if we had met yesterday. Went to his place - met up with his cousin. Relaxed for a while and then had breakfast - which was so heavy it was more of a lunch !! 

Nakul had to go to Shillong for a small site visit - and asked me to tag along. Also a few architects from Nepal had come to attend a workshop organised by Nakul - and they joined us for the trip. Two hours up - the journey was through a small winding road. We stopped at the "Orchid" for some lunch - and it was absolutely beautiful. The lake was on three sides of the restaurant. and with the large windows it looked simply amazing. Unfortunately the food left much to be desired. 

Further on we went to Shillong Peak - which had a panoramic view of the entire city of Shillong - however the weather became foggy and getting good pictures was not possible. Still - it was beautiful. Then - but not before getting in a small tiff with the **supposed** authorities about the use of a camera - we went to the Shillong Club to meet Nakul's client - owner of one of the best restaurants (The Bamboo Hut) in Shillong and he asked us to wait in his restaurant while he took Nakul along to the new site. The food here was amazing and the ambience of the place was also cool.

None to soon the day ended and we reached home. . . . .

A few photos to show what I mean

Dushyant Ahuja

When we remember we are all mad, the mysteries disappear and life stands explained

Creating segments along the way

Usually a company introduces a new product in one of the target market segments. In not-so-common cases the new product creates a new segment altogether, mainly due to technological breakthrough achieved. But it is surely rare that new market segment is created twice in a row in the same industry that too by the same company.

I am referring to Tata motors.

Until Nano the lowest segment in 4 wheeler market was the ‘low end hatchback’. Much has already been talked about Nano and how it has created a sub ‘Maruti 800’ market segment. Less popular though is Tata motors vouch to shake up the sedan segment.

Budget 2006 brought in separate excise duty for small cars, 16% instead of usual 24%, which has been further brought down to 12% in this budget. The classification of a vehicle as small car is determined by the length of the car being lower than 4 metres (and also engine capacity upto 1200cc for petrol and 1500cc for diesel). By smartly modifying Indigo (entry level sedan of Tata motors) Tata motors got its length to 3.95 metres making it eligible to claim the excise rebate. The new car is called Indigo CS (compact sedan) & will be priced starting at a coooool 3.79 L. The price is set to target potential high end small car buyers. What Nano has done for small car segment, Indigo CS plans to do for the sedan segment. Also note that CS has created a new segment without any major technological breakthrough.

Indigo CS has one more key advantage. Indica, Indigo and Marina all have the same engine. The tooling and R&D cost of engine can be recovered from the volume sales of Indica. Hence Tata is in position to price CS aggressively to keep competitors at bay. Competitors also may come up with ‘sedanese’ versions of their hatchbacks. Although unlikely, they may also pressurise government to make the excise rule more stringent so that CS cannot be claimed as small car.

Whatever happens, the vacant space between high end hatchback and low end sedan will definitely see lot of hot action.

Honey, Whaddaya do for Money ?

It is the year 2015. The IPL is in it's 7th year running. Sachin Tendulkar still makes the odd guest appearance for the Mumbai franchise. He only bats left-handed because of a tennis elbow. MSD still trades for $2 million (give or take a few in terms of his depreciating value). Ishant Sharma switches sides so he can bowl to Ponting every game. A greying ShahRukh watches from the pavilion with a scintillating Deepika Padukone, who's rumoured to be dating a slimmer, sexier Ramesh Powar who's made a comeback to the IPL. Shoaib Akhtar runs in steaming from the pavilion end and gets hit for a six by Rohit Sharma. ShahRukh picks his phone and the newspaper headlines read the next day "Akhtar transferred to Mohali franchise overnight. Deal price is a record low of $1200. Rahul Dravid planning to resurrect career in T20 after retirement."

I'm not sure if this is your idea of the future of cricket. It certainly isn't mine. Having said that, the Indian Premier League is a major victory for what Lalit Modi likes to term "free market economics". We understand the term and we understand how it works when it comes to deciding insanely high prices, which are based on even crazier speculative bids, for cricketers who are supposed to be inhumanly talented. And in a fair sense, one would really have to be a socialist or communist to not appreciate all of this.

But, serious questions need to be asked if the mad moolah that dominated the recent IPL auctions will take away what matters most - the beauty and variety of the game. The IPL is about a fast, quickfire, TV friendly format of cricket - the T20. In other words, it is about marketing a game that's slam-bang in variety and caters to the low attention span cricket viewer. Assuming that the market does exist for this variety, what could be the long-term consequences of the league?

Classically, Test cricket is still hallowed territory for the game and this is where batsmen and bowlers have an even chance of being successful. In my books, I find it tough to compare a Test scenario involving Sachin Tendulkar grinding it out in the heat against a steaming Brett Lee on a seaming Perth wicket or a Anil Kumble weaving his spell on a 5th day turning pitch Vs. a T20 scenario of MSD or Symonds hitting poor Piyush Chawla for sixes on a flat pitch. Yes, cricket needs the thrill and excitement but an even contest over 5 days on a sporting wicket is the true test of a cricketer's character. A free market economist would say "Let Test Cricket die a natural death". I'd probably say cricket will die in the process.

What does IPL mean for the smaller cricketing nations? A lot of players from smaller nations go to build up numbers and make quick cash in these leagues. Nations like Sri Lanka and New Zealand already have a very small player base to choose from. In other words, the national teams sometimes lose out on availability of players. Bottom line : The IPL needs to be sanctioned and controlled by cricket's governing body like a dog on a leash.

Does the IPL bode well for younger players? Yes and No. The IPL is a tremendous opportunity for under-21s to play with some of the best in a world. But one could also argue that the slog variety of the game is not apt for development of technique. One may get to see a lot of Dhonis enter the world stage, but not everyone may survive without adequate first class experience. The IPL is not a panacea for world cricket. On the contrary, it needs to be viewed as a sideshow that makes a lot of money.

What about corruption? Match fixing? No one's talking about it with all the money involved, just yet. Stringent rules being enforced and constant monitoring of inter franchise transfers is necessary.

How do the younger players handle money? Will cricket's rules change to accomodate more batting favourable rules (free hits, powerplay modifications) ? Will the T20 format encourage development of bowlers?

Many more factors come to mind before one could blow the trumpet on the IPL's tremendous kickoff. The money is good. The brand is good. Free market is good. But is it all good for cricket?
Time will tell.

I can almost imagine MSD getting introduced to his to-be in-laws by his girlfriend who says :
"Honey, whaddaya do for money? "
To which, MSD scratches his head and replies :
"It was Chennai till Thursday, yesterday I think I got transferred to Mumbai....Or was it Kolkata?"

Now that's insane.

Its all about Money...Honey!!!

My favourite story of cricket is from another generation: In 1956, India defeated New Zealand in four days in a test match. The team, which was paid Rs 50 per day at the time, did not receive an allowance for the fifth day. When one of the players dared to ask a cricket official for an additional fifty rupees, he was curtly told: "Who asked you to win the match in four days!"

The world has changed for the good, since then. As the cricketers went under the hammer, one couldn't help thinking how dramatically the sport has been transformed. As business tycoons and film stars bid furiously for the big and not so big names in the game, a revolution seemed to be in the making. The sport finally was becoming a part of the great Indian bazaar.

Cricket, unlike a few other competitive sports, has been burdened with the myth that the men who play it do so for the “love” of the sport (I speak of world cricket…).While footballers were being traded places for millions, F1 drivers and Golfers were millionaires, cricketers were expected to bask in the sheer joy of playing the game. Which other sport would allow teams to play each other over five days, at the end of which there could be an "honourable" draw? Which other sport was played with such an insistence on the "rules" and "traditions" of the game? Soaked in romantic prose, cricket was branded for decades as the "gentleman's game".

In a way, all Indian sport has suffered in a model of socialism in which all big businesses were “evil” and sport was a only a distraction from professional activity. When did sports then, particularly cricket, start hogging the front page? From a feudal sport to being the great Indian dream, the transformation has been gradual and fuelled by the convergence of sports, entertainment and most importantly corporate India. 1983 victory was a landmark as it coincided with the onset of colour television and the sudden realization that cricketers are commodities (marketable…).From Kapil’s shaving cream ad (“Palmolive ka jawab nahin”…remember) to Dhoni’s hair gel to music endorsements ???(Royal Stag…mega music…just in case u wavered J), it’s come a really long way.

The IPL, as I see it, is a brilliant example of the 21st century business enterprise. It may have raised eyebrows as to whether its worth the hype, but, I would definitely like to give it the benefit of doubt. After all, do we want to slip back to the era where talented cricketers were treated as daily wage labourers and expected to pay obeisances to the officials for being selected? Or do we want to see the talented cricketers demand their rightful place in the market? Talent should never come and most importantly “go” for cheap…

Its not all about MONEY HONEY!!

Budget and its implications!! The short sighted view has had an impact. The share market saw its lowest trend and i am not so sure if farmers really know what is being offered to them, but banks for sure have an astrologically bad time. While the government is very pro in hitting the right chords when it comes to making emotional people happy, it fails to sustain the happiness for long.
Sometimes i wonder, with the best of brains in country serving as civil servants, is forming a right kind of financial policy so difficult? Don’t they know that charity is old fashioned now, enablement is the key. I am not saying that good things do not happen, i have seen employment cards scheme started by government, i have seen good interest shown by big corporates in procuring rural products, i have also been told that a big retailer is looking at a huge tie up with airline fleet for transferring products across for its stores, so yes, the need for the day has activated many brains. I also know that millions of dollars flow in India in the name of upliftment, but unfortunately, with so much of resource at hand, the outcome is negligible. So, it is really not a lack of resource for us anymore, it is the lack of connection between demand and supply.
What needs to get going is- Infrastructure, education, technical know how, corporations in each village to disseminate knowledge and connect with demand side in cities and places abroad. They are forbidden world. They have power to work and act, but they don’t know which direction is the world outside moving into. With such intelligent civil servants at our nation's disposal, we fail to form a smart governance policy. (They don’t have to slog in fields, they just have to show direction and hand hold. I believe sitting in one village is a waste of time for a civil servant, his job is to plan a strategy and delegate, there are teams which can be hired to implement. )
Since childhood, i have come across many civil servants and year on year my conviction is strengthened, that no one can challenge their intelligence. They go through rigorous selection process, they are all well read and they can create smart business models, but they don’t; because politicians don’t use them. I am just left wondering today, politicians in every country are supposed to be politicians, infact even in normal job, there are politicians. Civil servants can not be thrown out of job by anyone other than a president, and that has not happened in the history of this nation. They have power and brain to tweak around the system, keep everyone happy and still do good for nation. Lalu has got a railway system running with the help of these brains, then why do others fail? You can remain as bad as you are, still do good for nation, every progress will mean an addition in your capacity to receive bribe.
And then, it’s not about money, it is just a resource. A resource without proper utilization is garbage. Give away crores if that keeps people happy, but create a system underneath to ensure that it solves the problem at hand. Why don’t we incorporate analytical techniques when coming up with budgets? Have the problem statements, goals, solutions. Once we have the roadmap, incorporate the emotional factor (say 25% weightage) for vote banks and roll out the governance plan. I am not saying hit your pockets, you are politicians for a reason, but make use of resources you have (civil servants, corporate influence) and do something which makes you feel proud of your own power and improves your earning capacity in future.

India always had more brain than money. Use what you have more, leniently and be a bit stingy with what is not your strength. All nations have politicians with similar characteristics, because that is the kind of skill set needed for being one. Beaurocrats were meant to compliment the politicians, but the education system is faulty, they are just books with zero convincing and “marketing” capabilities, may be. Politicians have done a great job (hit the emotions), civil servants have failed(Right governance and progress goals) . System has been failing for investing so heavily on dormant brains for years in this nation. In the end, it’s not all about money honey, there is something called brain which ensures that money is given its right place.

The Budget is not BAD, but this is not the kind of budget a nation seeing transformational economic progress expects.

The 65,000 crore write off

There was always an expectation that the current budget will definitely look into the issue of farmer loans. Too often have we heard about failed crops and suicides. As Mr Chidambaram said during his budget speech that the country has a deep gratitude towards its farmers. Actually this is true. Do we ever wonder where the sack of potato or onions or chillies are coming from. We just go into the market & expect fresh batches of vegetables/fruits/cereals all the time.

But coming back to the point. Though this was expected to a great deal what was probably not expected was the magnitude of this offer. Rs. 65,000 crores is at any point of time a massive amount of money.

In the short term, there will be a drain on the financial system. As pointed out, it will have an effect on the profitability of all PSU banks particularly in the 4th qtr results of FY 07-08. We have to understand the fact that these loans are assets in the books of the banks against corresponding liabilities which are basically savings & current accounts i.e. our money. Now if the assets vanish ovenight the banks might be under severe liquidity problems. Good thing is that the Government proposes that these right-offs would be compensated by issue of bonds, securities etc. so that the entire effect is not passed on to the Banking system.

Another effect this will have is a dearth of investible money in the hands of the banks. Till the time the bonds are floated the Banks will have less of cash to disburse as loans. This may lead to a demand-supply gap in the short term and the interest rates will probably continue to be high. This will be actually contrary to the expectation of a softening interest regime and may actually contribute to an increase in inflation.

Further, the scheme talks of farmers with a certain cap of land holding. This I believe is the biggest pitfall. The biggest question here is who is going to monitor this aspect. The farmers would probably be at the mercy of local authorities to freeze their holding and there might be a scenario of immense kickbacks in this regard. Also, who is going to stop the big farmers from dissecting their landholding to less than the ceiling limit in the name of family members. In India, unfortunately, money can buy anything. I believe that the administration will be the most challenging aspect of the scheme.

Another point which has not been explored is the loans taken by the farmers from local moneylenders. These are the loans, with exorbitant interest rates, that drive people to take their lives. It's a reality that only a small percentage of farmers take loans from Banks. For most, it's the local moneylender who demand huge interest and heavy collateral from which there is no escape. This segment has not been addressed at all.

Probably from a macro perspective, it would have made more sense that this money be spent on infrastructure - better irrigation, better crop & cultivation technologies, cold freezers etc. This would have resulted in a lasting effect. Because, till the time these things are not in place, the next round of crops would also potentially be at risk of failure and the fresh loans disbursed to the farmers will also be at risk. This will give rise to a vicious cycle. Having said that, the elections are actually not far away and that probably is the biggest reason towards any kind of budget announcement. The infrastructure development may have taken 5-10 years to put in place but by that time there may be a new government who will walk away with the credit. On the other hand, this measure has an immediate impact and will certainly help once elections come around. This I believe is the only negative thing about this entire scheme.

Having said all this, apart from the doubts as expressed above, I am totally for this scheme. I believe any amount of money is worthwhile provided it saves a life. We do owe deep gratitude to our farmers and in a socialist set-up we have to do everything to alleviate their position. There are certain things, we in the city, take for granted. The reality in the villages is very different. "Equitable distribution of wealth" is a word we have been hearing for a long time. This scheme, if administered properly, may go a long way to do that.

picture abhi baki hai...mere dost!

Why is it that some movies get me? And I mean, get me hook, line and sinker? And a very tiny few of them? I am a Bollywood buff. But that's not to say I watch all the movies (actually, I do watch a lil more, but just because I have an unlimited internet connection to d/l the choicest of movies :-)

But why is it that those few movies get me? By the end of when I watch such movies, I go hyper! Not hyper in the sense of jumping around on a pogo stick but hyper mentally. I think more and surprisingly seem to think more clearly at the same time after I have seen such a movie. What is more surprising is that, the people that I watch such movies with, come out of the theatre with a "well, it wasn't as great as I expected it to be" or "that piece could have been handled deftly" kind of look on their faces. I mean, don't they get it? Or 'am I the odd one out? I dont know.


I remember this altercation I had with a dude who had issues with "Rang De...". At that time (even today), I wouldn't buy anything against such a brilliant movie...brilliant not coz it had a message et al...but for the simple reason that while watching the movie, I could relate and would have done exactly the same things.The issue that this guy had was that it promoted violence. Gimme a break...we're humans...unless we're shown sex and violence...we aren't excited.So why crib?I asked him if he liked "Swades"...he said it was boring...precisely for the lack of "action".I mean...either I'm nuts or this guy is so open-minded that his brain has started falling out.

Remember when we were kids, we used to read so many stories? And remember how all those stories had an ending. When we were tiny toddlers, almost all those endings were the "and they lived happily ever after" type. And as we grew older, we came across endings which were not necesarily happy but the story still had an ending. Is it not possible for a person to direct a movie and resist the temptation to put an 'ending' into it? Its not about just trying to be different from the rest of the film-makers...but the devotion to the original concept so that nothing sways it."Mithya", I thought, was a courageous attempt.


So, all you creative people...the proposition is this..."Succumb to the Temptation" (remember the brilliant Kwality Walls' Campaign) and execute it with a twist!!!

Ways to Reduce Risk in the Globalised Financial Markets

Consider this. A person wants to achieve a particular goal. He invests his resources in the way of time, effort, and money, to achieve that goal. But, because there are many uncontrollable external factors affecting the outcome, he cannot be sure that his investments will lead him to his goal. So, if he does not reach his goal despite his investments of time, effort, and money, his investments will be worthless. The chance that this may happen is “risk”. Thus, in order to reduce risk, he must predict the uncontrollable external factors better and align his efforts accordingly. And that can be done by acquiring more information on the external factors.

Financial risk enters the economic system when companies decide to make financial investments in their businesses. These companies face the risk of losing the invested money, if their investments do not meet their goals. This risk is the fundamental financial risk of the economic system. All the other financial risks are “derived” from this risk. The risk that shares, bonds, mutual funds, loans, insurances, reinsurances, securitised debt obligations, commercial papers, and the more exotic instruments face is that the business investments that their money is ultimately funding might not meet their goals. For example, financial risk in the system may flow from the investing company, to the bank that lent it the money to make that investment, to the insurer that insured the bank’s loan, and finally to the shareholders of the reinsurer that reinsured the insurer’s insurance. And if the government bails out the reinsurer from its troubles, it simply passes on the cost to the taxpayers. But, in the very end, somebody has to bear the risk and pay the cost.

As mentioned above, in order to reduce risk, one must predict the uncontrollable external factors better and that can be done by acquiring more information on the external factors. In today’s globalised financial markets, four things complicate that process.

First, as risk flows from one entity to another in the financial system, as illustrated in the example above, it becomes more difficult to measure, especially for the entities that are farther in the chain. As the investing company is directly involved in the business project, it has the most amount of information about the risks associated with that project. But the successive entities have a decreasing amount of information about the same. Thus, they cannot predict the risk well.

Second, through a discipline named “financial engineering”, many financial institutions have been able to create mind-bogglingly complicated financial instruments by “mixing-and-matching” and “slicing-and-dicing” the underlying assets. Many a times these “assets” are nothing but some loans, such as subprime mortgages. It is arguable that the people that buy these exotic instruments have no idea about what they are really buying. Which leads to a scenario where nobody has any idea about which business investment his money is ultimately financing. And if you have no idea about what you are investing in, how would you calculate the risks associated with it?

Third, the actual risk gets exaggerated through the practice of speculation. Things may not be really bad, but the fear of losing money makes people overly cautious, which starts a self-feeding cycle that makes things worse. It’s akin to a bank-run, where a false rumour that a bank will go bust leads to a disproportionately large number of people claiming their deposits with the bank, which results in the bank actually going bust.

Fourth, and perhaps the most important thing that complicates the process of risk calculation, is that the financial returns to the individuals and the institutions “managing” the moneys are disassociated with the financial returns to the individuals and institutions that actually “own” the moneys, aka the end investors. For example, the returns that the asset management companies and their managers earn are completely disassociated with the returns that are earned by the investors employing their services. This leads to a moral hazard on the part of the asset management companies and their managers, where they start focusing on maximising their benefits as opposed to their clients’.

For these problems, I propose two solutions that will reduce the risks in today’s globalised financial markets.

First, instead of paying the financial institutions and their managers the same amount of money irrespective of their performance, decide a percentage of commission and pay them exactly as per the rate of return that they have earned on the funds managed by them. Financial companies and their employees would be a lot more responsible in making decisions about the funds they manage if their own livelihoods were at stake.

Second, create a stabilisation fund for each individual market. The amount of money in each of these individual stabilisation funds should be a pre-defined percentage of the total size of the respective markets. The percentage for each market should be decided separately, based on the amount of volatility that market experiences. This fund should be employed in the market when its regulators think that a speculative “bank-run” type situation has kicked in the market. This measure will greatly help in avoiding the collapse of financial markets and in providing security to the investors. The money for such a fund should be pooled in from the market participants themselves, on the basis of the fairness principle.

The above mentioned solutions strike at the roots of the problems facing today’s global financial markets , viz. inaccurate decision making by the employees of financial institutions because of the lack of an efficient reward system and high volatility in most financial markets because of the lack of a sane and stabilising player. I speculate that these solutions will help combat the issues effectively.

BRAND EQUITY

Like me, do you get the feeling that our world view is a mosaic of different brand filters? Let’s consider a scenario:

Anamika meets Rajiv for the first time on their first date. Rajiv takes her to a coffee shop mentioning how he loves the ambience there. As they sit down, Rajiv places his cell phone on the table. Anamika checks the time on her watch and fishes for her cell phone from her bag and calls up a friend. Meanwhile Rajiv is checking out the menu stretching out his legs with his boots on. He steals a glance at Anamika looking cute in her pink top and jeans. Wearing his faded jeans and his favourite black shirt, Rajiv feels pretty comfortable on his first date with her.

Anything out of the place? Maybe not at first glance. Take a look again.

Anamika meets Rajiv for the first time on their first date. Rajiv takes her to a Cafe Coffee Day coffee shop mentioning how he loves the ambience there. As they sit down, Rajiv places his cell phone on the table, a Nokia N92. Anamika checks the time on her Titan Raga watch and fishes for her cell phone, a Motorzr from her Gucci bag and calls up a friend. Meanwhile Rajiv is checking out the menu stretching out his legs with his Woodlands boots on. He steals a glance at Anamika looking cute in her MNG spaghetti top and Levi's jeans. Wearing his faded Red Tab jeans and his favourite black Diesel shirt, Rajiv feels pretty comfortable on his first date with her.

The point is this. Have you ever had the feeling you were trying to possess things you didn’t really need based on promises that are intangible at best? That someone else was creating wants you didn’t have before? Welcome to the surreptitious world of brand marketing. I am talking about brands that have made us want to possess things we didn’t need based on what they said those things will do to us. “Eat this and you will stay slim”, “wear that and you will be the hottest thing around”, “spray this and you will be irresistible”.

That is not to say all brands are ‘evil’. A brand is a promise. A promise of either physical, emotional or(and) psychological benefit(s). And there are many brands out there that have lived up to their promises. What I am talking about is those brands that have told us we cannot be what we want to be if we do not use their products/services. A brand that tells a girl she cannot be an air-hostess if she doesn’t use their fairness cream, a brand that tells boys they are losers till they start using that brand of deodorant…..you get the idea.

We are all beautiful people and we do not need some brand to tell us we are not good enough. We are free people. Free to make choices…free to question things. We are all free people and we are all curious as hell!!

Curiosity is one of the most basic instincts amongst us humans. We all have wondered where babies come from, if the face on the moon is indeed that of an old man and if the big bang was for real. Each of us continuously questions the status quo and why it needs to be that way. It’s an exciting journey, one on which WE choose our thoughts and our wants, not someone else.

Market corrections: US slowdown or ??????

The sharp corrections in the capital markets world over during January 08 are attributed to the concerns over a possible US recession and its spill over to the global economies. By now there remains little doubt that US economy is headed for a steep decline. First it was the sub-prime mortgage crisis and credit card defaults, now huge losses by Citi group and Morgan Stanley. The signs are getting clearer as the days pass by. Few will argue that this seemingly imminent recession will have its implications on other economies, both developed and emerging. They will too bear the brunt of US slowdown, given the interconnectivity of global economies in this liberal era. But no one seems to be sure as to what extent a US recession will hit other economies. Particularly for India, analysts seem quite positive. Most of them believe India’s domestic consumption driven economy will sail through this turmoil. Some even thinks India will benefit from a US recession as more jobs will shift towards India. Here lies the contradiction as to then why India’s bourses took a greater plunge than Dow Jones on concerns of a US slowdown??
According to financial market data provided by S & P, India was the fourth worst hit market during Jan08 with a correction of 16%. The loss was 12.44 for the emerging markets against 7.83% for the developed markets. 16 of the 26 emerging markets posted a double digit loss. Whereas the Dow Jones corrected by only 6.07%. This clearly indicates there is more to it than what meets the eye. Asian markets, it seems, are being played into the hands of western FIIs. Otherwise why would all asian markets rise and fall in rhythm? If the FII flows to India are at an all time high, so would be the withdrawls. It’s a natural cycle. So whether a US slowdown or not, markets will correct sharply in between scaling new highs. The 'Monkey business in village' story relates to the asian markets more now than ever.

Aamchi Mumbai - not any more ???

Allow me to move away from the heavy dose of economics to realpolitik.

The trigger was an article on CNN IBN which said that strong regional undercurrent is taking shape in Bangalore too. Well if events during the past few weeks in Mumbai are an indicator, I am sure that something similar is waiting to happen in Bangalore, Chennai, Delhi and other metros of the country.

I have never stayed in Mumbai for a long period, I have mostly been in and out of Mumbai (erstwhile Bombay). But I have definitely read about the character of the city, the resilience it has shown time and again. Be it the serial blasts in 1993 or 2007, Mumbaikars (residents of Mumbai) have always risen to the occasion without batting an eyelid. But the regional/ linguistic comments by some self proclaimed leaders and the disturbances that followed, have forced many people to think. The fact that such blatantly regional rhetorics went uncensored by other political parties (for initial few days) is more appalling. What followed was a national shame. Whats even worse is that the state administration allowed it to spill over. The nonchalance and immaturity of the administration doesn't even deserve a mention. Our forefathers had dared to dream about a unified nation, they had dreamt about the country INDIA and not the states. Whenever I will sing the National Anthem I will always remember that there is something that has gone wrong.

Punjab Sindh Gujarat Maratha
Dravida Utkala Banga
Vindhya Himachal Yamuna Ganga
Ucchala Jaladhi Tiranga

Maybe but Not anymore.

But being an analytical person, I tried to go into the reasoning behind the sudden regional rhetoric that are finding favor with the politicians. Not long ago, Delhi CM Sheila Dixit had remarked that "everyday 668 new people come to Delhi". The sums up the problem which Big Cities in our country are facing. The infrastructure has been stretched to the extreme, the culture of the city is getting affected, crime is increasing and many more ill effects of huge migrant population. But that calls for some brainstorming and not slogan shouting. Given the myopic politicians that we have been blessed with, it doesn't require an IQ of 150 to foresee the aftereffects of the regional rhetorics of Raj Thackeray. Politicians in other states are going to adopt similar stance and play on the insecurity of the ignorant and vulnerable minds.

Lets just hope that the ever abstruse "better sense" prevails over our politicians and their audience.

Japanese test matches

My experience of solving a sudoku puzzle in the form of a cricketing metaphor. Hope some of you fellow cricket fans can relate to this.

Scrapping through a tough as nuts sudoku grid comes close to a Test Match experience on Aussie soil.The initial opening conjures up visions of a sheep-like Indian bowling attack of Venkatesh Prasad and Javagal Srinath trying hard for that opening breakthrough against a bullying Hayden and a resolute Langer on a cold Boxing day morning at the MCG. The sparsely populated sudoku grid seems to be jeering at your ineptitude like a thousand Aussies spitting curses at a boundary posted Indian fieldsman on his first trip Down Under. It is hell and you are living it.

And then, the joy of finally getting a number on the grid brings with it a calm reassertion of self-belief. Heh, we got started. One number on the grid leads to a few others, closely resembling an out-of-form Ponting leaving without troubling the scorers. A surge of confidence as the grid appears a little less menacing and the Indian fielders begin crowding around the bat thinking they'll run through the Aussie lineup in one session. Not to be, my friend, not to be.

A partnership follows as the sudoku grid unravels itself to hold mysteries unfathomable by your mentally challenged self. Self-doubts arrive in bigger numbers. Field changes, bowling changes - read that travelling to different parts of the grid in an attempt to see loose ends. Gritty thought soon turns into desperation. Time ticks on..the runs flow. Much head scratching, back itching and team discussions with the inner self. Images of an untiring Kumble toiling on an unresponsive first day pitch. And finally the breakthrough arrives. Hayden departs and few others follow in his wake. The grid starts populating fast.

And then come the tail-enders. These doughty digits represent the last stand of the grid. It is easy to mess up a grid you worked hard to fill in the smug overconfidence that underestimates these vanguard warriors. Insert more pictures of Mitchell Johnson and Stuart Clark pushing up an already behemoth Aussie total to even more imposing proportions. More itching before the grid's last shreds of resistance collapse.

1.5 Hours. On a sudoku grid. An Indian cricketer's Australian baptization. It's all the same.

India's thmpatic win against the aussies...

The win against australia on 10th Feb at the MCG established beyond doubt that India does have that potential to challenge the world champs on any kind of pitch. The fact that Sunday’s convincing win was after a long hiatus of 21 years on that ground is indicative of the strides Indian cricket has made. But then, talent has never been india’s problem. If one has observed properly, India has always had world class batsmen in its armory. Performance apart, Indian batting line up has always looked strong on paper. One would argue that I am looking at the wrong aspect wrt Sunday’s win. It was mainly due to some world class bowling by the India’s current pace trio Ishant, Pathan and srishant. Even harbhajan was quite tactful and showed some great cricketing sense. Ishant, in particular, has been in tremendous form throughout this Australia tour. He was instrumental in the perth test win where he scalped the wicket of inform Ricky Ponting in their second innings and set the tone for India’s win. I fully agree with this conclusion. I don’t want to take any credit away from this young yet tough breed of bowlers India has produced. Still I would say that batting is and will remain India’s stronghold for times to come. The main obstacle in way of India’s getting to top despite abundance of talent is their tendency to succumb under pressure. In my view India has had such solid batting strength as would make any target achievable on any kind of pitch or would consistently set 300+ target. But the same bunch has been found to get bundled out for less than even 150 quite often. It’s a common sight watching Indian batsmen finding it hard to play their natural game after India looses some early wickets. The consistent failure of the batting has put pressure on the bowlers to take the charge and often worked India’s way. But in the long run India will have to depend on its core strength. Since last so many years India has not been able to produce a single world class bowler. But many of its batsmen are among the top run grossers. Six or seven out of eleven would be having atleast one century in their name. even then it is not a coincidence that on one day they can chase mammoth targets but the next day they all r struggling at once. Indian cricket team surely needs mental toughening if they r to perform on a consistent basis. Had Ishant got nervous after being hit for 18 in that over or had Rohit or Dhoni crumbled when Australians were trying to make inroads after India lost 5 wickets, it would have been the same old story.
The professional cricket has evolved much. With the kind of cricket that the Australians are playing, you need to be physically and mentally very fit to push them from the top. Talent alone would not suffice at all.

Property rights in India

Microfinance initiatives in India are being seen as the next big thing in terms of inclusive growth. In terms of inclusive growth, any microfinance organization aims to provide financial services to rural poor (part of the informal economy) in a way that they can afford it and pay for it. Theoretically, the rural poor are being made to participate in the economy and partake of it.

The biggest challenge to microfinance initiatives, like any other enterprise, is to get return on investment. Typically such an initiative would function in many ways similar to a bank. However, the biggest challenge comes from pushing the poor to have enough savings and assets to repay their loans. The cost of financial transactions incurred can be recovered if the net savings go up. In the event that the net savings are low, any asset that the poor have is placed as collateral so that they can repay these loans. As is the case in India, rural poor save by funding their own enterprises or selling their produce to retailers/middlemen. Typically such savings go on to repay their loans over a long period of time. Yet, it seems to me that the business model is such that microfinance initiatives would stand to make a lot more profit if land/property rights were granted across states in India.

Around 28% of India's population lives below a common denomination called the poverty line. Around 60% of India engages in agriculture which only contributes 28% to the GDP. Land use is inefficient and often land ownership is ambiguous because of title disputes and a feudal history.

Amidst all this, one wonders that if the rural poor got land ownership rights and title deeds, such land could well be used for other purposes or even as secure collateral. This is certainly no pipe dream, considering initiatives of this kind have succeeded in a couple of states across India, particularly Gujarat. In this enlightening article, Swaminathan Iyer(of Swaminomics fame) writes :

"Yet, in one state, SEZs are coming up rapidly, with no agitations, no disputes - and hence no newspaper headlines! This is Gujarat. It already has five functioning SEZs, with 12 more ready to start in 2008.

The Gulf of Kutch is the only coastal area in India with low rainfall. Farming is tough, so farmers are willing to sell their land. The state government itself owns vast wastelands, mud flats and marshes along the coast. It has been selling these to developers (like Gautam Adani at Mundra), without displacing farmers.

Even in central Gujarat, where land quality is high, farmers have proved willing to sell. The pharmaceutical SEZ of Zydus Cadila has acquired 110 hectares, paying around Rs 10 lakh/acre. In other states, industrialists say they cannot get contiguous land through voluntary purchases: a few farmers will refuse to sell. The experience in Gujarat is that even farmers who say no initially will say yes if offered a sufficiently high price. Developers should pay this very high price to a few farmers and get on with the job. Why look to the state government for acquisition, which takes two years or more? Time saved is money saved."

As Iyer mentions, Gujarat's experience cannot be faithfully replicated in other states - say Bengal, Orissa. However, ownership of land allows a rural farmer bargaining power. The land could be sold, mortgaged or used in any way fit to push up one's credit. Land that remains in agriculture then needs to be efficiently used to push up yield - India's yield being only 30% of the average highest world yield.

As India's GDP grows, people inevitably move from the primary sectors (Agriculture, mining or foresting typically) to secondary (manufacturing) and tertiary (services) sectors. Accordingly the contribution of the primary sector to the GDP goes lower as a country's economy grows. As economics plays itself out, land ownership rights will be quintessential to allow the rural poor to move into other sectors and partake of a bigger piece of the pie.

I'll hopefully follow up with the kind of initiatives that could be taken to resolve land ownership disputes in the Indian context.

Sky Diving - The Jumps (with Photos)

All excited - I got on the flight from Mumbai to Ahmedabad on Friday.
Was met by Sourin, Narottam and Harnish at the airport and we were
off to Deesa.
Met up with a few more trainees in Deesa - mostly from the army.
Nothing much to say about that night - don't remember much of what
happened as it was all wiped out by the experiences next day.

Got up early morning - had breakfast - and went to to the Deesa
airfield (with a slight detour as we lost the way and reached a dam
instead).

The winds were perfect - the weather was absolutely clear - just one
small hitch - our plane was stuck in Ahmedabad as it could not get a
take-off slot :-( -- then started a long wait - a few warm-up
exercises and another loong wait. Finally the plane touched down at
11:35 AM

By now the winds had become faster and all the first-timers were told
that we would have to wait till the winds died down and were to watch
the experienced jumpers and learn by watching them. To cut a long
story short - watching them was very informative - but by now we were
getting impatient and waiting for our turns. Finally I got my name
into the 7th Sortie - I was to jump second.

I was excited - got my parachute on (fit-chute) -- and was ready for
the jump. Soon I got into the plane with Surya sir and Narottam -
perfectly normal till now. Then as the plane started going higher - my
heart-beats started getting faster - I was actually afraid - it was
the beginning of a sheer terror an almost panic and I could not
believe myself - it was like one part of me is terribly afraid - and
the second part is looking on and wondering why he's afraid. We
reached a height of 3500' and Narottam jumped first - I got into
position - the position being keeping one foot on the strut of the
plane, the second inside and looking straight. I looked down - and
almost panicked. Surya sir tapped on my back and shouted 'GO'. Against
all instincts - against everything I ever felt - against my TOTAL fear
- I stepped into thin air and made the exit position.

Took a few tumbles and heard my parachute opening above me. As soon as I jumped
out the fear vanished (at least for the time being) - I was out of the
plane - I was safe (i.e. alive) and I was back in a state when the
panic was not controlling me anymore. I looked up and saw that the
lines of my chute were twisted as I had tumbled - I took hold of the
risers and pulled them apart to untwist - got my bearings and started
experimenting with the canopy - left turns - right turns - and finally
landed safely and nicely (about a 100m ahead of the target). It was
all amazing. But whenever I thought of the time I jumped I felt the
panic come back immediately - it was almost as if a fear was the only
thing !! I could not believe myself - on one hand I was telling myself
that I loved it had a lot of fun blah blah blah -- on the other hand
there was nothing but terror at jumping again.

Imagine stepping into that

I had brought the cash for the second jump thinking that I might go
for it if I enjoy a lot - I had enjoyed a lot - but found myself
making excuses for not jumping again - its too expensive - how will I
get to Ahmedabad - etc etc. However deep down I knew I was panicking -
I had managed to control the fear once in the air - but now it was
getting hold of me and I knew that if I did not jump again today - I
would never sky-dive again. I controlled myself again - paid the money
- asked them to get me on the earliest sortie possible. I took the
second jump not just because I had enjoyed the first one - but because
I had to control this fear.

I was on Sortie 11 - went up again with Surya sir and Jitin - again
jumping second. This time I kept calm - kept repeating the exit drill
in my mind - "GO - jump - slipstream position - 1000 - 2000 - 3000 -
4000 - 5000 - check". I fumbled a bit while coming into position - got
my wrong foot ahead at first - corrected myself and jumped at the word
"GO". This time it was perfect - there was no fear - a certain amount
of anxiety - but not the shear panic I had felt the first time - I did
not tumble - the chute had opened perfectly - I had time to experience
the flight - I tried 360 degree turns - made a full circuit pattern
for landing and landed safely. It was the most amazing experience till
date. Best of all I knew I had conquered my fear - I knew that now I
would be absolutely addicted to sky-diving. I was part of this group -
and not an outsider looking in.

The entire experience was a learning experience - not just about the
art of parachuting - but about myself.
Photos below:

2008_02_09 Parachuting - Deesa

US sub-prime crisis and India

Disclaimer: All views expressed by the author have evolved out of analysis and might suffer from paralysis. You are free to take your stand. :D

The hot topic as it may rightly be called. Economists world over are busy number crunching the illusion fall( or may be coming down to ground reality) of banks under the term,"Sub Prime Crisis". Well for my dear readers who are like me ( need things to be simple to get striaght in head :)), the crisis relates to increasing number of defaulters and foreclosures of home loans in US. The sudden increase of defaulters has led to an increase in availablity of houses and hence the lowering of property values. The general life style of US is based on hypes and valuations, so as they say, take risks, you will spur and you will fall down equally well, but you will enjoy both.
The idea here is high risk loans which fell on the wrong side. Stocks, securities and properties work on valuation mechanism. The fall of value is directly related to demand and supply. There were too many MBAs diversifying the portfolio of credit lending to make the share of sub prime lending in home loans reach to a proportion of one fifth and all calculations failed when risk anticipated turned into reality. This was just to give a brief context on the problem at large.

The question is, how does it impact India and other Asian developing countries, considering that this is an era of globalization and US' Godliness has been diversified, however, it still remains to rule because of its high risk taking appetite.
Things which are bound to be impacted-
Impact on IT? Oh yes. I have been involved in this industry for sometime now and i can say that around 60% of revenue for most of the big IT companies comes from US clients and Banks INVEST on quality and technology in quest to go global. While sectors like energy and utlity and retail are picking up, banks still remain to be the big HUB of investments in IT. To add to it, banks outsourced a lot of processing to India, so BPO busines is BADLY hit. So, a) reduction in customers ( to an extent). Falling value of US dollar would mean reduction in profit margins for IT service companies. So, b) Reduction in profit earned and that drives stock values in simple terms. Suddenly, the organizations are crying for improving productivity, reason, bottom line is what can be impacted, they really dont have control on top line. I dont count it as negative though, its a balancing act. Anything that grows leaps and bounds has to come back to ground reality and normalize. So, probably we are maturing and we will do balancing act to diversify our client portfolio to diverse geographies and most importantly understand the value of domestic business and drive demand from local industrialists. IT impacts a major part of middle class population, their purchasing power and hence the domestic needs. IT is one of the best pay master for youngsters, so yes middle class will be impacted, they might not come on ground, but the luxuries will reduce.

Things which are bound to balance-
Well, i do want to thank Tatas and Birlas and Reliance. We will survive and will be impacted mildly( if the assumptions go right) in the game because they have invested in food, shelter and clothing business. We as a nation invest in steel, we manufacture cars, we build infrastructure raw materials, and we export clothes. And here, we dont look at margins only, we look at volumes and geographies. We trade with Sri Lanka, singapore etc etc( which IT is waking up to do now). They have made right use of globalization by diversifying their organizational business portfolio to keep IT a part and reinvest its earnings in expanding the busiess on basics which can not be ruled out for life. So, we come in business which trades in salt, grains, clothes, wire, phones, steel and since we are a poor uneducated nation, the economy at lower end does not know what US mortgage is, they never even had a bank account. How does it matter if US falls or awakes, we will still live. May be we will reduce our two cell phones to one because banks dont give us loan anymore, but then what the heck, we never had a phone to start with.

So, guys the answer is yes, we will be impacted. IT is not all that rich till US comes out and IT companies diversify their client profile by taking a hit on their profit margins. And sadly, these guys pay well, huh! BUT, i will love to call it a balancing act. This is about a bubble that bursts. We get slightly impacted, but our economy gets chance to diversify and decrese geographical dependency to make optimum usage of globalisation. Only sad part is, we react, we dont pro act. Never mind!! everything that happens over next two years will take us more and more towards sustainable growth and development, might be a bit slow but yes, steady. :)

The American 'decline'

Interesting perspective on the American economic decline. To quote this statistic:

In his 2006 book "Überpower," German writer Josef Joffe makes the following back-of-the-envelope calculation: "Assume that the Chinese economy keeps growing indefinitely at a rate of seven percent, the average of the past decade (for which history knows of no example). . . . At that rate, China's GDP would double every decade, reaching parity with today's United States ($12 trillion) in thirty years. But the U.S. economy is not frozen into immobility. By then, the United States, growing at its long-term rate of 2.5 percent, would stand at $25 trillion."

Full text of the article here.