Sunday, September 23, 2012

An argument on FDI in retail

This weekend I was in Delhi at my parents' place. Had gone to the city for a business trip, and stayed back a day to dig into some of Mom's yummy chaat. 

Chatting about this and that, the conversation came to the opening of FDI in retail, and whether it would be any good for us. Being a dyed in the wool reformist, I played out the usual arguments about how large format retail would increase efficiencies in the value chain, help farmers and producers get better prices, and reduce prices for consumers. Additionally, they would help allied areas like real estate, employment etc. For good measure, I added that any sector that has seen foreign money come in (telecom, airlines, insurance, automobiles, white goods etc etc has all improved product quality exponentially and driven prices down so significantly that it would have been unimaginable a decade ago. 

My mom's experience had been that large format retail (think Big Bazaar or Reliance Retail) initially had low prices which caused the local kirana folks to buy from them and on-sell, but over time prices moved up and the kirana shops applied a mark up on the higher prices. Also, the large stores usually stocked sub standard produce (cold storage potatoes, stale veggies etc) which cannot be good for health, generally speaking. In dad's opinion, large format stores would drive out small shopkeepers from business, and with less competition, prices would begin to rise. While I agree with some of these points, I think they miss the wood for the trees. 

I do not think that it is imperative for India to have Wal Mart stores. However, I think it is imperative that we get the intellectual property that these chains have and apply them to Indian supply chains. As for collateral damage, such as loss in livelihood of middlemen or mom and pop kirana stores, creative destruction is unavoidable. As an example, politicians in the state of UP shut down Reliance Fresh stores there, while other states have welcomed them. I do not think UP is any better off than before, or than its alternative. In the welcoming states, on the other hand, at least a large chunk of people have got gainful employment, and consumers low prices.  

I am all for opening up the economy even more fully to foreign money and expertise. Long live liberalization!

Friday, September 14, 2012

Sherlock Holmes - the new TV series

I was given the new BBC Sherlock Holmes series by a colleague, and saw the first episode today. Frankly, I was just blown away!

Not by the story, which was fine, if a bit gimmicky. But by the actors and the development of the characters. Benedict Cumberbatch is a masterful, if impish, Holmes. He starts off being aloof and superior, but by the end of episode one, you can't help but like him. The real hero though is Martin Freeman as Dr. Watson. Starting fragile and ginger, he 'grows up' quickly and in the end, quickly becomes a peer rather than an appendage. An ally, not a flunky.

The dialogue is sharp and crackling, and the humour very British. The 21st century elements - iPhone, blogs, nicotine patches etc. etc. add to the story without taking anything away from the core of the books.

All in all, a fantastic production. Pity there are only 6 episodes made thus far. I'm planning to watch all the remaining 5 over the weekend. 

The death of cash

In the past week, we have seen co-ordinated and unprecedented action by global central bankers.

First, Mario Draghi, chariman of the European Central Bank, said that he would buy short dated government bonds from any Eurozone country that asks for his help. Effectively, he is saying that he will unleash a flood of liquidity and force yields downwards, making it easier for governments to fund their spending or repayment programs.

If this was uncharacteristic of the Europeans, what came next was the biggest bazooka of all. 'Helicopter' Ben Bernanke, chairman of the US central bank (so called because he once said that if throwing currency out of a helicopter to people below could help the economy, he would do it), laid out QE3. How much is he willing to spend? No limits at all! He says he will spend $40bn each month - for ever, if required, buying mortgage bonds till the US job market improves. This is the stuff of superhuman comics and real epoch making events.

What this means is that currencies are racing against each other to debase themselves, so that borrowers have to return less (in real terms) than they had borrowed. Lenders (savers) are going to get shafted. But hey! no one said capitalism was benign.

The markets are celebrating wildly, because this means that the global currency taps are open without limit. However, I think we need to be a bit circumspect - because after this, central bankers have no more tools left. They have done all they could (and maybe more than they should). Now it is up to the politicians to deliver - austerity / increased productivity in Europe, and spending in the US.

Whatever happens, one thing is sure - these events will be discussed and debated in history books many many decades from now. All I can hope for is that these gentlemen are looked upon by history as heroes, and not villians who blew up the world as we knew it.

As for me, I am going to move all my meagre cash savings into gold or land! The reign of cash is over, the era of assets has begun!

Thursday, September 13, 2012

Praise for the Batman.... again

Just happened to stumble across this piece when trawling the web over the Anish Trivedi cartoons episode. The author is Vir Sanghvi, a guy whose views I usually like to read.

So now we know how it ends. Batman retires and Christopher Nolan’s trilogy, which began with the magnificent Batman Begins, draws to a majestic close. I’ve been a Batman fan almost from the time I learnt how to read and have loyally followed the character through good (Frank Miller’s re-invigoration of the legend; the first Tim Burton movie; Nolan’s Batman Begins; the death of that nasty little creep, Jason Todd who was the second Robin etc.) and bad (the 1960s TV show; Batman and Robin, possibly the worst movie in the history of cinema; and the introduction of Aunt Harriet as a character in the Wayne household). But never has the myth of The Batman seemed as potent as it does now, after Nolan’s trilogy.

Spoiler alert: if you have not seen The Dark Knight Rises and intend to see it, then you should stop reading here lest I give away too much.
There are broadly two kinds of Batman fans: those who know him from the comic book and those who knew him from movies and TV. Even within those categories, there are subdivisions. If you liked the Batman TV show, then you are probably not considered cool by fans of the later movies. If you liked the Sixties and Seventies comics when Batman and Robin came across as a pair of boy scouts (or like scout master and scout), then ‘real’ comic fans don’t see you as cool. If you like the graphic novels that have populated the Batman universe over the last two decades, then you are so cool that you might as well be a nerd. (The line between fanatical graphic novel fans and geeks is a thin one.)
I’m not sure which of these categories and sub-categories I fit into. I got into Batman through the Sixties comic books and though they seem pretty lame now (at one stage there was a whole Batman family of Batwoman, Batgirl, Batmite and even Bat-Hound), they appealed to kids of my age. And many of the elements that we thrilled to: Batman’s secret identity as playboy billionaire Bruce Wayne, the Batmobile, the Batcave and such villains as the Joker and Catwoman have stood the test of time.
What I did not know, when I first read the Sixties comics was that they were sanitized takes on the original Batman. Created in May 1939 as a masked avenger along the lines of Zorro and the Phantom (who predates Batman and was clearly an inspiration), the character was first called The Bat-Man, tended to appear only at night, was on bad terms with the cops, wore a mask as much to avoid the police as to protect the people he loved, and had no hesitation in dispatching criminals to their death.
But within a year, DC Comics, had begun to soften The Bat-Man by giving him a young sidekick called Robin. And soon, when Batman’s original creator Bob Kane failed to come up with enough comics, a platoon of new writers and artists, each of whom had his own vision of the character, took over: Dick Sprang, Carmine Infantino, Mort Sheskin, Jim Mooney etc. Almost as influential as Kane himself were writer Bill Finger and artist Jerry Robinson who created the Joker. Kane, however, insisted that his byline always appear and was reluctant to share credit.
Even in this softer form, Batman went on to become an international rage, was featured in two movies in the 1940s and got his own hit TV show in the 1960s. The dark Bat-Man of the original comics was more or less forgotten for over 40 years till Frank Miller wrote The Dark Knight Returns. This was a series of comics set outside the normal continuity which imagined a future where a middle-aged Batman came out of retirement to fight crime. In Miller’s world, the public had turned against superheroes, TV was full of the same idiots debating the same issues every night. And corruption had seized control of society.
Almost all retellings of the Batman legend have drawn from Frank Miller’s version of the character. The idea of a dark and dangerous Batman intrigued Hollywood and a Dark Knight movie with Mel Gibson (playing Batman as an anti-Semitic midget, presumably) was planned but never got off the ground.

Eventually the project went to director Tim Burton, known for his weird and fantastic view of life. Burton took a dark Frank Miller-like Batman and placed him in an imaginatively designed Gotham City which was described in the script as looking “as if hell had erupted through the sidewalk.” Because the studio was not sure that Michael Keaton (who Burton cast, against type as Batman) had enough star quality, Jack Nicholson played the main villain, the Joker, and stole the movie.
Burton made one more Batman-in-a-weird-Gotham-City movie, costarring Danny DeVito as a depraved, sewer-dwelling Penguin. By then the comics had also decided to focus entirely on grown-up themes and a much darker Batman. Bane, a muscle-bound villain, was introduced and in 1995, in the long-running Knightfall series of comics, he actually beat Batman, breaking his back across his knee.
Even as the public thrilled to a darker Batman, the movies lost the plot. A new director, Joel Schumacher, made the comic book-like Batman Forever (with Val Kilmer as an excellent Batman) and then followed it up with the disastrous, campy Batman and Robin which even the casting of George Clooney as Batman could not save. That movie, as Clooney often admits, sunk the franchise.
When the Batman movie series was revived, the British director Christopher Nolan agreed to direct only after he could start afresh, wiping out memories of the last dud picture. The studio agreed and Nolan’s reboot of the franchise Batman Begins starred another Brit, Christian Bale as Batman and told the story in a more realistic, matter-of-fact manner. (The movie was packed with Bit and Irish actors: Michael Caine, Gary Oldman, Liam Neeson etc.). But Nolan went back to the idea of a Dark Knight, abandoning the comic book persona of the last two Batman pictures.
Batman Begins, a terrific movie, was followed by a film actually called The Dark Knight which most people (except me: I thought it went on for too long) regard as the finest Batman movie at least partly because Heath Ledger played a Joker who was as dark and dangerous as Bale’s Batman. (Jack Nicholson had gone over-the-top with his portrayal).
But Nolan also introduced topical themes. At many levels, the Dark Knight was an allegory for the American of the post 9/11, era fighting a battle against terrorists whose motivation it could not understand. The end was morally ambiguous: Batman beats the Joker but pays a terrible price. And serious contemporary subtext kept cropping up.
The Dark Knight Rises begins eight years after the events of The Dark Knight and freely borrows from the Frank Miller series and from Knightfall. Batman has retired. He has not been seen for eight years. The villain is Bane who wants to take over Gotham and who releases all of the city’s criminals. Bane is in league with Ra's al Ghul (as in the comics), the villain from Batman Begins. There is even a reprise of the famous scene where Bane breaks Batman’s back across his knee.
From my perspective, it is the best comic book movie ever made partly because it is tightly plotted, well-acted, (Anne Hathaway almost steals the picture) and well put-together. And once again, Nolan taps into America’s current concerns: Wall Street is bad; Bruce Wayne is cheated out of his fortune through bogus futures trades. America is no longer the land of opportunity and the cracks beneath the surface are coming to the fore --- in this movie -- literally, right after the Star Spangled Banner is sung at a football game!
I won’t give more away. But even if you have no previous interest in Batman, go and see this picture. For once, every element in the Bat pantheon is brilliantly integrated. And the end has an emotional power that is unusual for comic book pictures.
What a pity it is the last movie in this trilogy!