Crisis and opportunity

By most parameters, we are bang in the middle of tough times. Bombs explode at will in our metro cities and kill and maim innocents every few months. Fear stalks every move, even an innocent stroll in a busy market. Two of the top 4 investment banks in the US (and most B School students' employers of choice) are history overnight. A lot of friends / colleagues / batchmates are out of jobs and the outlook looks bleak for a lot more. Cassandras are calling it the beginning of another worldwide great depression.

One cliche I have always heard is that the Chinese symbol for crisis is made of 2 parts - one signifying danger and the other opportunity. While current times do seem like they are loaded with danger, it seems very difficult to find the opportunity anywhere.
To find and exploit opportunities needs character. Where will we find character?

We cannot look for it in the government in India, which has tried to stem the scourge of terrorism but has not been very successful. We certainly cannot look for it in the home minister, who keeps parroting inane homilies every time there are lives taken. We cannot look for character in the shenanigans of the US Treasury or 'Helicopter' Ben Bernanke, who have tried to bail out falling giants, but are finding the going very tough.

That leaves us. All of us, Indian or otherwise, citizen or police, consumer or producer, have to show character and last out these tough times. Because, like all things natural, times will change, and the situation will improve. It is a question of riding the storm out.

My favourite (for the moment)

Rock On rocked.
Check this out:

Aargh!!! Not another...

Another day, another irritant...

I woke up to this (courtesy Mint) - not my idea of a great start to the day.

 

In a nutshell, the issue is thus: India is suffering from a major power shortage crisis.  The only way out of this crisis is more power generation. The government has tried (for 61 years now) and has realized that it cannot build generation capacity fast enough. Enter private power producers. These guys will put at RISK (this is a term that ALL bureaucrats should be drilled with - in fact, there should be a separate section in the IAS exam on risk and reward) millions and millions of dollars, and produce electricity.  They will try to lock in long term offtake contracts that gives them adequate return for the risk they are taking with their millions. Electricity cannot be stored - if not used, it goes waste. For this reason, they keep a small percentage of power uncommitted so that they can sell it in the spot market to overcome any sudden requirements. For this, there is a market mechanism to determine rates that these producers get - it is a simple auction on an electricity exchange - the buyer sees prices, and decides if he wants to buy (if so how much) or no.

Enter Mr. Bureaucrat. He is all-knowing and all-powerful. He thinks he is smarter than the market. He is in addition, a bleeding heart. He says - from now, you cannot charge more than Rs. x per unit. He justifies it thus - “How can an MPP developer sell power at Rs8 per unit while it is only costing him Rs2 to generate" The learned gentleman does not realize that there is a risk that someone is taking that needs a reward. In any case, how does he justify the cap of Rs 6 per unit?? So he is saying - you can make 3 times your money, not 4 times. I am the arbiter and judge of this, and not the market. This is because I am smarter and wiser than the market. 

Is this bureaucrat going to guarantee offtake? What if there is no demand for power, or no transmission capacity at a particular time from the power plant to the user? Then the producer makes electricity for Rs 2 a unit, and cannot sell it. So the money goes waste. Will this generous gentleman then assure offtake?

The net result - government intervention in pricing will kill private investments in power generation or power trading. India will continue to be condemned to live the life that its bureaucrats thinks she deserves. 

It would be comic if it were not so pathetic. 

Chrome

I am writing this post from the all new Chrome - Google's new web browser. Right now (in ten minutes of use) I cannot figure out how it is different (or better!) from the Internet Explorer - except the fact that I need to re-install some plugins that I had on IE. 

Full report in a couple of days!!

Heard on the radio

Delhi has this (well deserved?) reputation of being an aggressive and violent city. Today I heard a jingle on the radio which captures this nicely and along with Delhi, pokes fun at itself -

Man: Shooting, wrestling, boxing...
Woman: (disgusted) zaroor Dilli wale honge
Man: Arre, these are our Olympic winners!

I like it

Why so serious?

So much has been written about The Dark Knight that saying anything else about it would be cliched at best and plagiarism at worst. However, having just seen the movie, I feel compelled to spread the word. The movie is - not to put too fine a point upon it - SUPERB. It is the best comic book movie ever, and I dont think there can be a better one. I was always a Batfreak, and I am always wary of things that other people praise, but this movie has exceeded my wildest expectations.

Without further ado, here is a list of the things I loved about the movie -

The characters:

1. The Joker - the guy is a genius, evil personified, who is always one step ahead of Batman, the police and the District Attorney. The freak without a plan, a disciple of chaos, the single most powerful character of the movie had me hooked. Heath Ledger, with his nervous flicking of the tongue, really lives as the Joker. The 'irresistable force' more than matches Batman's 'immovable object'
2. The concept of Batman as menacing - I always thought of Batman as a good bloke, but after this movie, I can see why he is a menacing presence to all
3. Two Face - the ultimate rational being, who gives everything a 50-50 chance. Also, a victim of fate

The ideas:

1. That Batman is unique in that he need not be a hero, and so can do what is right. This special quality makes him transcend the usual crop of (now seemingly) daft superheroes
2. That chaos is more menacing than the most scary 'plan'
3. That it is ok to burn down the forest to get the rogue bandit

The gadgets:

1. The Batbike - uber cool. What else can I say?
2. The brightly blinking 'parachute' that flies up
3. Two Face's coin

The dialogue:

1. Why so serious?
2. One must die a hero, or live long enough to become a villian

The technique:

1. The fast pace and buildup of suspense in the screenplay
2. The background music - haunting and enticing

This is the third Christopher Nolan movie that is in my list of all time greats - after Memento, The Prestige and The Dark Knight, what will he come up with next?

Thoughts from the spectacle

I watched with great amusement the (in)famous trust vote in Parliament on live TV. Must say it was more engrossing than any of the K-soaps (not that I have, or ever would want to watch the damn things). It had all the elements - drama, suspense, passion, intrigue.

At the end of it all, the primary thought that struck me was that there is a silver lining in all this muck - no, I was not at all disgusted by the sight of wads of money being waved around - lets face it, how surprising was it? Everyone - bar none - knew that large scale buying of votes is pretty common in our polity - it has happened before, and will happen again. So why go all hypocritical and apoplectic about the 'sanctity' of Parliament or the 'damage to the integrity of the nation'? In fact I think this is a good thing because it at least lays out the rules of the game clearly - jiske note uska vote.

But to return to the silver lining - and that was that among all the cacophony and noise, the speeches by Rahul Gandhi and by Omar Abdullah stood out - for being sensible, rational, and (dare I add?) ethical. I was an ardent opponent of Sonia Gandhi being offered the PM's post, but I have revised my opinion about Mr. Gandhi Jr. For one, the guy spends a lot of time actually visiting far flung places and seeing how things are happening on the ground. For the other, even for his (incorrect?) prescriptions to problems - remember the famous Rs. 70,000 crore farm loan waiver? - at least he has in his target the correct problems. Not stupid cliches like 'communalism' or 'communism' but a much more real and practical war against poverty. That is the real scourge that needs to be eradicated, and that is what our esteemed lawmakers should spend their time thinking about. Whether you choose Medicine A (i.e. fiscal grants, loan waivers etc.) or Medicine B (i.e. spreading education, enabling entrepreneurship, upholding basic human rights and restoring individual dignity through capitalism) is the next step. But the basic step is to recognize the problem.

I have hope that Rahul Gandhi and Omar Abdullah and their like have recognized this problem. The King is dead - long live the King!!

Quotes on fear (thank you Wikipedia!)

Like one that on a lonesome road
Doth walk in fear and dread,
And having once turned round walks on,
And turns no more his head;
Because he knows, a frightful fiend
Doth close behind him tread.
Samuel Taylor Coleridge, The Rime of the Ancient Mariner, Part VI, st. 10 (1798)

Courage is resistance to fear, mastery of fear — not absence of fear.
Mark Twain, Pudd'nhead Wilson, ch. 12 (1894)

I must say a word about fear. It is life's only true opponent. Only fear can defeat life. It is a clever, treacherous adversary, how well I know. It has no decency, respects no law or convention, shows no mercy. It goes for your weakest spot, which it finds with unerring ease. It begins in your mind, always. One moment you are feeling calm, self-possessed, happy. Then fear, disguised in the garb of mild- mannered doubt, slips into your mind like a spy. Doubt meets disbelief and disbelief tries to push it out. But disbelief is a poorly armed foot soldier. Doubt does away with it with little trouble. You become anxious. Reason comes to do battle for you. You are reassured. Reason is fully equipped with the latest weapons technology. But, to your amazement, despite superior tactics and a number of undeniable victories, reason is laid low. You feel yourself weakening, wavering. Your anxiety becomes dread. Fear next turns fully to your body, which is already aware that something terribly wrong is going on. Already your lungs have flown away like a bird and your guts have slithered away like a snake. Now your tongue drops dead like an opossum, while your jaw begins to gallop on the spot. Your ears go deaf. Your muscles begin to shiver as if they had malaria and your knees to shake as though they were dancing. Your heart strains too hard, while your sphincter relaxes too much. And so with the rest of your body. Every part of you, in the manner most suited to it, falls apart. Only your eyes work well. They always pay proper attention to fear.Quickly you make rash decisions. You dismiss your last allies: hope and trust. There, you've defeated yourself. Fear, which is but an impression, has triumphed over you. The matter is difficult to put into words. For fear, real fear, such as shakes you to your foundation, such as you feel when you are brought face to face with your mortal end, nestles in your memory like a gangrene: it seeks to rot everything, even the words with which to speak of it. So you must fight hard to express it. You must fight hard to shine the light of words upon it. Because if you don't, if your fear becomes a wordless darkness that you avoid, perhaps even manage to forget, you open yourself to further attacks of fear because you never truly fought the opponent who defeated you
Yann Martel, "Life of Pi", (178-9)

I must not fear. Fear is the mind-killer. Fear is the little-death that brings total obliteration. I will face my fear. I will permit it to pass over me and through me. And when it has gone past I will turn the inner eye to see its path. Where the fear has gone there will be nothing. Only I will remain.
Frank Herbert, Dune - Bene Gesserit Litany Against Fear (1965), pg. 8.

Fear

There is nothing to fear but fear itself - Franklin D Roosevelt

Oftentimes the fear of the unknown cripples me. A dark gnawing shadow grips my very heart and paralyzes my brain. I become helpless and freeze. Such is the power of fear.

At such times, I draw inspiration from stories of other peoples' overcoming great obstacles. I remind myself that life is a series of arbitrary events that even out in the end. I reassure myself that I can take the rough with the smooth.

I read this statement again. I am no longer afraid.

Jaane Tu? Not really...

Saw the mega-hit and much appreciated Jaane Tu yesterday. And came away with mixed opinions. The movie is overall ok, though only because of 3 positives. The negatives, per me, are 2 (but really big ones!).
Ironically, 2 out of the 3 positives are probably the shortest parts of the movie. And they are: 1) Naseeruddin Shah's character 2) Bhaloo and Bagheera and 3) the hero himself

The negatives are 1) The heroine: all she does in the entire movie is sport a very supercilious expression. The lady tries to be "sweet" but ends up looking like a class A candidate for punishment. Her accent is also pretty thick and should have been worked upon.
The 2nd negative is the story itself - somehow it does not seem feasible in the least (not least the rigmarole and hurry-scurry during the climax). What are mobile phones for, if I may ask?? And how about PCO booths?

All in all, I think the problem was that I went in with expectations that were higher than warranted.

Communist bashing

For a change, this is not me ranting away, but more measured opinion :-)
Check it out here

Some excerpts:
There is a long history of such conduct, going back to the Communist hostility to the Congress-led freedom movement and the willingness to act as agents of the British imperialists (because both Soviet Russia and Britain were on the same side in World War II). That was followed by the denouncing of Independent India as a bourgeois sham, leading to armed insurrection against the lawful government. And when the Chinese attacked India on the northern borders, the Communists once again did not take a clear position with the national mainstream

As for economic issues, when the Green Revolution was achieved, the Communists criticised it as a phenomenon that would displace labour and help only big farmers — whereas it is the Green Revolution that helped India become self-sufficient in food. Indeed, in Punjab which was at the heart of the change, there has been a growing labour shortage, and not the creation of surplus labour. The Left was also critical of the induction of computers, organising strikes to stop computerisation and thereby condemning office workers and whole organisations to manual processes long after they should have computerised and achieved quantum gains in productivity. Once again, the war cry was that workers would be displaced, whereas it is the computer age that has created huge employment in the country — with the Left Front-ruled West Bengal now struggling to reap some benefit by inviting the computer software giants to come to the state. And, of course, the Communists were bitterly critical of the "IMF-World Bank-dictated" economic reform programme that got launched in 1991; ironically, it is this very programme that has given the country freedom from IMF conditionality and also from the need to borrow from the World Bank

For many years, the Communists have also criticised those not of their ilk as being foreign agents, compradors and such like. Yet, as Soviet documentation has established, it is the Communists who were busy taking money from a foreign country, even as they pointed fingers at others. And coincidentally or not, the Left's opposition to the nuclear deal happens to tie in quite nicely with the interests of Communist China, which would like to see India remain in a nuclear straitjacket

Screwed!!

A friend recently had a windfall and landed some good money. He (being a saving type) does not want to splurge it on consumption goods, but wants to use the corpus to ensure financial security later in life. He is a worried man!
He narrated his logic to me thus:
1) if he keeps the money as cash, inflation erodes its value very quickly
2) if he invests in stocks, going by his recent experiences, he could see the value of his windfall decline 30% in a week
3) the amount is not large enough to buy any real estate. Moreover, he does not want to take a loan and buy property in these times of rising interest rates
4) if he keeps it in a fixed deposit, negative real interest rates screw him
5) he would like a new car, but he thinks rising oil prices will make running costs prohibitive

Not being entirely sober at that time, I suggested he roll up the entire amount, and throw it 'on the toss of a coin' (as Kipling would have said, rather written) on crude oil futures. Alternately he could punt on a short position on the US dollar.
That is the only certain thing in these bedevilled times!!

Thought for the day

I met a hugely successful person (by all conventional standards) today. Though he had a tendency to speak in rhetoric, one good thought he left with me -
'Don't run after money, because then you are only running along with everyone else. Follow your principles, do what you do best and let money run after you'

Not reproduced here verbatim, but substantially to similar effect. I love it!!

Powerful

I saw Aamir yesterday, and was blown away by the movie. It is gripping, hard-hitting and powerful. One needs a strong stomach to watch the thing. Although it evoked very mixed reactions from the people around me, without giving anything away, a few things that really stood out for me in the movie:

• The humanity of the protagonist - the guy is an everyday joe, doing what anyone would in his situation. What he does at the end, when he takes charge of his own destiny, is something that requires great courage. The alternative was quite easy to do, and putting myself into his shoes, I probably would have taken the easy way out - I could not have done what he did
• The depiction of Bombay - very real (brutally so!)
• The taut script - no needless subplots, no (melo)dramatic dialogue, good background score, good acting. The name itself - Aamir - which means a leader of men - is very apt
• The thoughts it provoked in me - the essence of the movie is that everyone is responsible for their own destiny, and that there comes a time when (to express it most beautifully) a guy's got to do what a guy's got to do. An individual is a trifle, insignificant and immaterial. There comes an opportunity to transcend oneself, to become greater than the sum of your existence and the society around you. The one who grabs that opportunity is Aamir

Day dream

Malvinder Singh is a guy I envy right now. The dude is all set to pocket approximately $2.5 bn (or Rs. 10,000 crores - the number of zeros in that number has me reeling :-) from selling Ranbaxy to the good Japanese at a hefty premium to market.
Without going into usual debate over whether he did the right thing or no (suffice it to say I approve of the transaction), the more interesting debate in media right now is - what the blazes is he going to do with Rs. 100,000,000,000 (thats 11 zeros folks!)?? Mr. Singh still has a job (he will continue to lead Ranbaxy), and he has made some noises about making Religare a bank (though I dont think he is very serious when he says that), but all this does not prevent me from fantasizing about what I would do if I ever laid my hands on such moolah.
Of course my initial thoughts run to tropical islands, decadent living and luxury homes, but then I decided to find out what use better minds than mine have figured out for money.

• Till recently Mr. Rich Man #1, Bill Gates has decided to give away all his money to the Bill and Melinda Gates Foundation, which will use it to prevent AIDS, and organize social initiatives in poor economies like India / Bangladesh etc.
• Mr. Rich Man #2 (and God to legions of investors), Warren Buffett will give away his entire fortune to (surprise surprise) the Bill and Melinda Gates Foundation
• Not too long ago India's richest family, the Tatas, use all the profits from the Tata companies (via Tata Sons) for charity...

I begin to see a pattern. And it gives me ideas. What I would really do with Rs. 9,990 crores (I have put away 10 crores in the bank, remember?) is

a) build a huge university. The university will operate on a pure capitalistic model, with extremely high standards of admission, the best paid faculty, and the best hostel infrastructure, and a market driven fee strucutre. However, the poorest 30% students would get scholarships which would cover their tuition fee (the funds for this would come from interest from an allocated amount). (I will need to devise some smart way of figuring out the real deserving poor students vs. rich kids whose parents get their income through 'unofficial' means)

b) build a huge hospital, extremely modern and efficient, with the best infrastructure, the best paid doctors and nurses, and market rates for treatment. However, the poorest 30% patients will get diagnosis, treatment and medicine for free (funds to come out of interest on an allocated amount)

While I actually have no clue if this would cover the amount at my disposal, I have an idea it would be enough. Anything left over I will hand over to my wife to invest in equity markets and multiply manifold, the proceeds of which I will use to buy my decadent island :-)

Greener grass

After an intense week (and weekend) spent furiously working away, including an entire weekend spent in office, minimal sleep (it is now 1:15am and still a couple of hours to go before i can call it a day) and lots of stress, clarity emerges on some key issues -

1. Family is your most precious asset - without loving and caring family one is finished
2. Better work somewhere you really like - otherwise every challenge beomes a huge burden
3. There is no free lunch - there are trade-offs in almost everything in life
4. Living today is the only way to live - who has seen tomorrow?
5. The grass is always greener on the other side
6. Sleep is the most under-rated luxury

Fuel prices - the strange truth

Another fuel price hike is imminent within a couple of days. While I had always argued for de-regulation of retail fuel prices, I recently came across some interesting information on oil price dynamics in India.

I always assumed that fuel prices are artificially low in India. Let us test this hypothesis. The US (where gasoline ie petrol prices are market driven) retails petrol for $3.6 - 4 per gallon. One gallon = 4.5 liters and 1$ = Rs 42.6. Doing the math, we get Rs. 34 - 37 per liter of petrol. In Delhi (which I believe has the lowest fuel price in India), it retails for Rs 43 / liter. So how can it be under-priced??

The interesting answer is that petrol is underpriced in India from the point of view of oil-marketing companies only, not from the end-consumer point of view. And the guy who keeps all the cream is (no surprises here!) the Government of India.

Here is how it works (all numbers for example only) - petrol price (at international prices): Rs 100. Landed cost in India: Rs 105 (price at which the oil cos refine / buy the stuff). Taxes paid by oil companies (like IOC, HPCL and BPCL) to the Govt (incl. excise, customs and sales taxes): Rs 40. So oil companies' cost: Rs 145. Retailing price: Rs 120. Loss to oil co: Rs 25. Loss to consumer: Rs 15. Gain to big brother GoI: Rs 40.

GoI is a well meaning guy. He wants to make sure that he gets votes. So he takes this Rs 40, and distributes it as largesse to various deserving sections. The only hitch - his agents (the political honchos and bureaucrats - guys in charge of making sure it reaches the right people) - keep Rs 39.5 out of this Rs 40. So they can stash it under their mattresses / maintain their multiple mistresses / send their kids abroad etc etc.

Nice scheme.

Also another reason why oil prices in India will never be de-regulated (at least not while the Congress and their brethren in bed the Communists are in power). Hopefully this will change one day!

A happy end to a long saga

The Bharti - MTN story has finally had a happy ending. First, a disclaimer - Bharti Airtel has been (and remains) one of my favourite stocks, so anything I say here is obviously biased :-)

While in my humble opinion, the deal would have been good for Bharti had it gone through (it would have given Bharti the chance to replicate its low-cost model elsewhere i.e. MTN has much lower margins than Bharti even though it gets much higher ARPU or revenue per user), it is better that Bharti decided to put its foot down when the MTN board reneged on agreed terms and wanted a reverse merger. I think this is a story that MTN has played out multiple times in the last few years - it has dallied with every large mobile operator you can think of - but has always gone back on its word when the rubber hit the road. It would be tough for anyone to take MTN seriously from now on.

Except our dear friend, Mr. 'Power' Ambani, who will gladly jump in and do anything to see valuations rise as he huffs and puffs to demonstrate his victory in sibling rivalry. Anything except improve his companies' operating performance, that is. Even then, tough to see how he would agree to make RComm a subsidiary of MTN.

I think this also demonstrates the high quality of management at Bharti, who were able to walk away from a deal which they could have done, because it went against their desire to make Bharti a truly global company, instead of merely making themselves richer. I think they have done the right thing! All the best to them...

Flicks on a flight

Come to think of it, most of the really good movies that I see are on Jet Airlines flights from Europe to India.

I saw Paris, J'taime last time around.
This time, I started the flick feast with 'There Will be Blood'. In one word - mind blowing. Daniel Day Lewis creates such an intense character that it is tough to rivet your eyes away from the screen. There is blood, of course, and oil, and religion, and greed. Extremely intense and dark movie - a must see.

Next up, I checked out 'I am Legend' (only for Will Smith). Not impressive at all.

And finally, when it was almost too late, I started watching a movie that I have been wanting to for a long long time - Manorama, Six Feet Under. I liked the movie tremendously, especially Abhay Deol's believeable character. However, great tragedy struck, since just 20 mins from the end of the suspense thriller, the plane began its descent, and the movie was turned off :-( So till now I am festering in curiousity about whodunnit.

Anyone who has seen the movie, please call me up asap. Otherwise I may have to go to Europe again!!!

Scrambled thoughts...

I met up with some friends in Venice. These are very nice, educated, intelligent people. What they had to say about what they hear about India left me feeling weird - I didn't know whether to laugh or be concerned about the massive ignorance about my country. Sample a few gems:

1. The main newspaper in Verona (a small Italian town, with a population of 300,000 - about the size of Dwarka in Delhi), carried a full front page article on the "moral outrage" that IPL cheerleaders have caused in India
2. A lot of people believe that all 5 star hotel gyms in India have a sign over treadmills saying "Please do not run over 10km / hour because that will cause a power cut in our hotel"
3. Indians do not like sports. They do not exercise, and they do not lead healthy lives
4. India is a bad country to do business in - the Four Seasons hotel in Mumbai had to get 201 govt. permits to install 201 taps in their 201 hotel rooms

I feel great anger at these perceptions. No one talks like this about China - this is because China performs while India only promises. I want my country to perform as it is capable of. I want people to talk with awe and envy when they speak about my country. I am proud about my country and I will refute anyone who thinks otherwise.

This is why I feel inordinate anger at Manmohan Singh. He is criminally wasting the energy of a billion people. He is harbouring Arjun Singh, whose sole ability is that of licking his master's (or mistress') heels, and a gift for screwing up a billion people. He is harbouring Anbumani Ramadoss, who is worried about what Mallika Sherawat is doing on screen, instead of who is manufacturing spurious medicine. He is advocating salary cuts for CEOs, so that his cohort can make more money as feudal overlords of licenses.

I would rather have Mayawati as PM. At least she says what she means.

Fantasies for beating the merciless summer sun

1. Swimming in cool, originated-from-melted-snow waters of the Jhelum river in Manali
2. Sipping absolutely chilled beer in a cool, dark room with the TV playing a light romantic comedy in the background
3. Showering for 2 continuous hours in cold, underground tank stored water (slipping into a tub full of the same water while reading a nice book also merits the same rank)
4. Putting ice cubes in the air cooler tank, darkening the room, and lying on a straw mat on the cool floor
5. Making lots of money speculating in the stock market / winning a huge sweepstakes, and buying yourself a month long luxury holiday to Switzerland with the same
6. Sitting under a leafy huge peepal tree in a huge garden with bright green grass, on a hammock, and sipping cold nimbu paani
7. Wearing an ice-vest (idea courtesy Australian cricketers)

Other ideas welcome...

Paisa Vasool? Maybe not...

Yesterday I saw an India Premier League T20 match for the first time (first time? I hear you exclaim... the reason why I did not watch any match earlier are too complicated to be dealt with on this post), and walked away un-impressed. The match between the Kolkata Knight Riders and the Mumbai Indians (what kind of name is that??) did not hold out too much promise in any case. But my reasons for not liking it are different.

Most important, I was not rooting for any team. It made not the least difference to me if one side was winning or the other. I dare say it would have been exactly the same had the Delhi DareDevils been playing (again, a name I do not sympathise with!). This robbed the match of any kind of excitement.

Next, the players themselves seemed kind of ho-hum about the whole affair. Ricky Ponting is the last guy I would want to be against if his national team is on the backfoot. But in this match, he seemed quite casual. In fact, I probably should not name names, because even the Mumbai players seemed to lack any kind of bonding. It was just a game to everyone (probably as it should be!)

Third, I did not like the garish golden/ugly blue helmets and pads that the players had on. It looked like a blooming circus show

Fourth, the match itself was pretty one-sided. Right from the first over. So much so, that I gave up after the first six overs, and returned for a very brief interlude towards the middle of the 2nd innings

Maybe this is a litany of negatives without reason. But I certainly do not see what makes it so attractive for everyone else. Apparently the whole nation watches little else on TV. Not that I disapprove - if this is what they want, this is what they should get.

Theatre of the Absurd

I always suspected that we are moving inexorably towards a police state in India, given the bleeding hearts not only in Government, but alas, among general society, who think that laissez faire is a concept best left to academia. They have all the answers, and they know best what is good for you, me and everyone. They are the proponents of the communist state!

I suspected it, and now I have evidence. Sample this, sourced from today's Economic Times. It first made me slack jawed in disbelief, then exceedingly angry, and finally just numb and confused. Am I reading this right? Is there something that I am missing?

(italics are mine):
Ban on pvt school teachers on investing in stock market mooted
20 Apr, 2008, 1041 hrs IST, PTI
MUMBAI: Teachers in Maharashtra's private schools may be banned from investing in stock market if a proposal by the Education Department is implemented. Reason? The Department considers such investments as gambling. A proposal mooted by the education department says that the teachers in private schools in the state could invest only in cooperative banks and credit societies.

The Government has come up with a 'code of conduct' for secondary school teachers, including those in private schools. The draft code of conduct has been circulated among the teachers' unions. The proposal also puts restrictions on investments and business by family members of the teachers. If any member has an insurance policy, or is involved in insurance business or any other business, it needs to be reported to the Deputy Director of education, according to the proposal.

It also stipulates that teacher should not marry a person whose ex-partner is alive and also bars teachers from entering into a marriage contract sans permission from school management. The proposal also adds that marriage to a foreigner should be reported to the management.

The proposal also puts restrictions on teachers' participation in social or political movement and asks them to convince family members to do so. They would also be required to inform the management if a family member wants to contest election.

Connaught Place in pictures

Photos from walk described in earlier post (move mouse over photo to see label):

A walk around CP

Being a bit free in office, I just took off for a bit and went down to CP in the middle of the day. The bright sunshine and the happy milling crowds sparked off the thought that I miss out on this cheerful daily spectacle everyday for no reason! There is something about the magic of human contact, even though you may not know even a single person among the thousands walking by, that beats sitting by yourself in an air conditioned office all day.

Another thought that struck me was that Connaught Place really is quite pretty. The quaint architecture, the wide grassy lawns, the massive wide roads are all quite alluring. If only the honking of cars reduces a bit (which it will - CP is going to be a no-traffic zone from 2010), it would become comparable to the best town centers in the world (Marienplatz in Munich comes to mind).

Yet another thought was - what the hell was I doing in my younger days, when I should have been roaming about this place, without a care, like all the pretty and happy young people here? Sigh! Lost opportunities! When I was closeted with my books (actually I never was! I think it was mainly the computer and the intranet which kept me occupied :-) during college days, I missed out on this hugely relaxing aspect of life. And though I probably am reasonably well off today because of my education, I kind of yearn for the lost, carefree days when I could have chilled out in CP doing nothing.

And the final thought I had was that commerce is booming! Foodstuff is getting sold (literally) like hot cakes :-). The branded stores may not be selling too much, but good old value priced stuff is flying off the shelves and into shopping bags. Roadside pirated booksellers are doing roaring trade. Plastic is getting flashed a-plenty. I am not worried about falling home prices or subprime credit issues half-a-globe away!

I am sure I would have got more insights after imbibing a chilled pint or two of beer. The temptation was almost too strong to resist. If only I had someone to share it with, I would definitely have taken the plunge :-)

Genuine confusion

Something puzzles me about the Dahllies (that is Delhi for those unfamiliar with Delhi's 'sophisticates' and their accent). And that is the following:

If Vasant Vihar is VV
If Defence Colony is DefCol
If Punjabi Bagh is PBags
If Kamala Nagar is KNags
If Greater Kailash is GK
Why is South Extension not SEx???

Identify the bigger bull!

The new new thing

What is it with the IIMs? I always suspected that they breed some kind of a herd mentality (actually I'm being very harsh here - all education in our country has the same outcome!), but what convinces me is this new rush to publish books with an 'IIM' tag.

It was started by 'Five Point Someone' which was the first in its niche. It was followed up by some juvenile effort called 'Anything for you, Ma'am' or some such about life in IIT. And I have been the victim of 2 recent publications - one which was truly despicable ('If God were a Banker' - which tries to peg its tag to IIM AND Citibank), and the other ('The Funda of Mix-ology' - What bartending teaches which IIM doesnt) which, while not the absolute dumps, is nothing to write home about either.

And more to come - I already see marketing efforts for more IIM books.

My point is not that all IIM books are trash - it is that if you need to leverage your IIM roots to sell your book, why dont you write something half-readable? In my opinion, you are diluting the brand, and giving up your chance to stand out from a cluttered marketplace (this sounds suspiciously like what some marketing guy would say, and I am certainly very poor in that discipline, if my grades are anything to go by!!)

I still look forward to the IIM book which is a) relevant b) readable and c) purposeful. Hell, I may just write one myself!!

Why would I want Feedjit?

As some of you may have noticed, I recently put a couple of embellishments on my blogpage. These include a survey app and a very simple scripting app that tells me who visited my page from where and left from where (branded by Feedjit).

The survey has been a spectacular flop, with 2 votes so far (I must shamefacedly confess that both were me, to see how the damn thing works!!). But maybe that was because the survey question was un-imaginative. The other application is what puzzles me, once I sit down to think of it. Why would I want to know who visits my blog page? These could be some reasons:

• I want to generate advertising revenues by showing off my multi-national readership (not the case, since this is a not-for-profit enterprise).
• I want to tailor content according to readership (I dont think I am that good or versatile yet!).
• I am curious (a bit, but not REALLY).
• I go on an ego trip by looking at how many countries I have readership in!!
  

Of all these, I think #4 wins hands down. However, this application is an inaccurate barometer for measuring countrywide readership and getting grandiose thoughts of being a widely loved and respected writer :-) This is because a lot of internet traffic is routed via firewalls / filters / gateways which reside in the US / Europe. For example, whenever I was logged into my corporate network at my last employers, I would always show up as a US origin IP address. So there is not much sanctity to what Feedjit shows me.

It does have its uses though (mostly for reason #3). For example, looking at what the damn thins says right now, I notice that the last person to visit is from 'Petaling Jaya, Wilayah Persekutuan'.

Clearly, I am much intrigued by who could be living in 'Petaling Jaya, Wilayah Persekutuan' which looks like it is in Malaysia. I try to rack my brains about classmates / colleagues / friends who could be in Malaysia right now. Cant think of anyone. I also notice that I myself show as having arrived from 'Bombay, Maharashtra', whereas I am indisputably in Delhi.

In conclusion, I find this application not of much use, and have decided to remove it from this page! I aslo want to ask other buddies who have this application - What is your reason for putting the thing on your page?

Whither Expert??

The bull market frenzy of the 6 months preceding mid-Jan of 2008 has given rise to a new species. In addition to the bulls and bears of the stock market, we had the curious spectacle of the emergence of the 'expert', popularised by the opium distributing CNBCs and NDTVs of this world. This 'expert' needed no skill, experience or achievement. All that was required was 1) an ability to follow the herd superlatively, like it had not been followed before and 2) massive doses of selective amnesia, to be able to forget what was said yesterday, and indeed contradict it with impunity.

Sample this - Mr A (who shall go un-named here) says on January 4 (nifty at ~6,100): the Nifty is poised to touch new highs. If it crosses 6300, the next target is 6700, to be reached within a couple of weeks. So far so good, the guy is entitled to his opinion. The self same Mr A says on Jan 23 (post nifty crash at ~5,000): the nifty is in a major downtrend. The next target for the nifty is 4000, which if violated, the index could go to 3,500. Duh! Dude, maybe you dont get it, but that is like forecasting yesterday today! Your opinion is not merely irrelevant, it is contradictory and self-defeating!!!

There are so many such examples that I could possibly not list out the entire bunch here. Having an honest opinion is fine - you could be wrong, but having an opinion that changes POST facto, based on the trend and what others are saying, is not only stupid, it is unethical. The reason such characters abound is driven by two factors - 1) the desire in our media to create 'celebrities' - we see it on the garish vernacular channels, where it is more in-your-face and 2) the lack of financial maturity in our markets. This is not surprising, given that most of us 'invest' based on tips from friends / colleagues or these 'experts'. Contrast this with developed markets, which, though driven by the same basic emotions of greed and fear, and much more evolved, measured and rational about the state of the economy.

I have hit upon a novel way to make money off these 'experts' advice - I promptly do the opposite of what they tout. Believe me, it works!! What a lot of retail investors dont get is that investing is a serious business, best handled by professionally qualified and experienced individuals. This is what enables the 'expert' to survive, and indeed thrive. I wish our market quickly learns this fact and stops the loss of its hard earned profits!! In the meantime, I look forward to profiting from their babbling prophecies.

Haikus

Consultitis had this nice post on haikus.

A good one repeated here:
Phantom ship moves through
waters hushed in mist. Foghorns
question the darkness.

Here are a couple of my own contributions!

soft clicks of a keyboard
and muted good mornings in cubicles.
sensuous aroma of coffee

bright sunshine and heat
sweat pouring off eyebrows. a quiet songbird chirps
in a silent moment

laid out on a hammock
swayed by the breeze, gazing gently at the sky
epiphany strikes

A (not-so) radical idea

The world is entering (in already in?) a phase of slowing economic growth, if not an outright recession. While classical economists will argue that this is part of normal business cycles, and that it is necessary to curtail excesses built in the boom years of asset price inflation, I think there is somethink different this time around (famous last words?? :-))

Usually, economic recessions are coupled with commodity price recessions. What is different in this recession is that commodities are still not easing at all. Oil climbs everyday to new highs. Metals, gold, foodgrains are still bullish. Part of the reason is the significant dollar weakness, but this alone does not explain the significant price inflation in commodities.

The reason is not too difficult to fathom. China, India and the developing world is using up more and more of basic materials, and this is causing their prices to rise. On top of that, the Indian government is trying to use fiscal measures to stimulate the economy (it desperately wants to keep inflation low in an election year, although by doing this it is curtailing growth in sectors that are really suffering - export dependent sectors for example, which will continue being hit as dollar flows seeking higher debt returns cause appreciation of the Rupee, or realty, or autos). But this post is not about the ills of the lame duck Indian government.

The problem with fiscal measures is that they benefit commodity producers more than they benefit the Indian economy. In an environment where oil and fertilizers are massively subsidized, fiscal measures cause more use of these commodities because of the unnatural price cap. This benefits OPEC - both for oil and fertilizers since natural gas is the biggest raw material in fertilizer production, not India.

How can this situation be balanced? And now we come to the (not so) radical idea - that oil prices in India should be de-regulated. Not only de-regulated, but the subsidy on diesel and keroscene at the cost of petrol should also go. Though this will cause some pain in terms of inflation, the long term benefits will be massive:

1. Prevention of leakages in fiscal stimuli to the economy
2. Less waste of taxpayers money, which could be used to fund massive infrastructure build
3. Environmental benefits, as the normal demand-supply economics curtail use of oil for transport, in polluting diesel generators, and in wastefully inefficient industries
4. Less congestion on roads, better use of public transport, and saved time from efficient travel
5. Less dependence on fertilizers and pesticides in farming produce (and therefore better long term health benefits, with lower wasteage in terms of health costs)

To me, it is unclear why the government does not see this long-term solution to a lot of our problems.

An epic love story

...no, i am not talking about Jodhaa-Akbar, but about the Hip Hopper. Warning: a bit suggestive!!

Babbar Sher (edited)

I always listen to FM radio when I'm driving. Babbar Sher is one program which makes me increase the volume. A sampling of the corny couplets on air:

Samundar ke kinare baithe hain
Kabhi to leher bhi aayegi
Taqdeer ab badle ya na badle
Par chappal to dhul jaayegi

Another one -

Suna hai ishq mein
logon ki neend ud jaati hai
Kaash koi humse bhi ishq kare
Aajkal kambakht neend badi aati hai

And another -

Darakht ke paimaane mein
Furqat se chilman-e-husn ka sharmaana
Iska matlab samajh aaye
To humein bhi samjhaana

Is it just me or is something wrong?

I ambled into a shoes store at the Vasant Lok shopping complex in Delhi today. The sign outside screamed - flat 40% off! and I thought this was as good a time as any to replace my trusty worn out Reeboks.

Inside I had a tough time, because:

• most of the shoes were large and clunky, boasting of various exotic things like air-max, dmx, shockx and allied technologies
• they were all quite ugly looking
• the prices were astounding! nothing less than 6 grand - after the 40% off, it came to around 4 grand
• there seemed to be very little variety, if at all
• the shoes said 'Made in Thailand' and I recall that in Bangkok, the same shoes were available for close to a thousand bucks not too long ago

I walked out thinking that this particular shop must be in a last ditch desperate attempt to make its monthly rental by fleecing clueless people like me. I then walked into another store - and then another - and another - and the same situation persisted!

Is it me, or has something changed in the last couple of years. Six k for a pair of ugly sport shoes??

PS - Discouraged and disheartened, I succumbed and bought a pair similar to my old pair. The financial damage has me reeling...

Peering into a crystal ball

Economic news everywhere is very grim. The headlines scream out about a recession in the US every day. The US fed keeps cutting interest rates like there is no tomorrow. Every week sees some new humongous write-offs by US and European financial institutions. Markets everywhere are in a tailspin. All in all, a portent of economic disaster waiting to happen.

I tried to step back and make sense of all of this. What does this mean? And how can one position oneself for this? First, some (foolhardy?) predictions:

• The Indian economy will continue to chug along at around 7% real growth. High interest rates will continue strangling retail credit growth and corporate investments, and GDP growth will moderate by a couple of percentage points. Real estate, autos will be damped. However, domestic sectors like consumer goods, telecoms, infrastructure sectors, financial services will continue to flourish.
• The rupee will continue to appreciate, driven by inflows of arbitrage seeking capital, keeping IT, textiles, auto component sectors under stress.
• The government will try fiscal stimulants for maintaining growth - effectively, tax cuts, increased infrastructure creation, populist sops. However, in an election year, there will be high sensitivity to inflation, so money supply will be curbed with continuing high interest rates. All of this will crowd out private investment.
• The US consumer-led slowdown will cool growth worldwide, and bring down prices of commodities like metals, oil, shipping etc. However, demand from India and China will keep oil from falling below $50-60 per barrel. This will lead to continued creation of petro-dollars, which will continue buying distressed assets in the US. Eventually there will be a backlash, and the petro-dollars will flow into markets such as India.
• After a while, investors will realize that India is a good place for generating returns, and this will cause a slight re-rating of the equity market. In other words, goodbye to 40%+ returns, and hello to more stable 15-20% type of returns for a year.

Of course, all of this may not come true. The US economy could probably be made to have a 'soft-landing' due to the Fed's rigorous rate cuts. However, this would create conditions for the next crisis 5 years down the line. There will be more empty talk of 'de-coupling' of India, but after a decade of 8% type GDP growth, this de-coupling will actually happen.

Our kids will probably see that happen. Till then we will periodically squeeze out the excesses in our asset prices in 5 year cycles (note that the last two depressions in India happened in 1996-97, and then 2001-02). So watch out for 2012-13!!

Rediscovery of an old favourite

My wife has recently re-discovered fascination for an old favourite of mine - Erle Stanley Gardner's wonder lawyer Perry Mason, and his sidekicks Della Street and Paul Drake. Her enthusiasm has rubbed off on me, and recently we bought a lot of these books and compete with each other to read them first.

I was always a big fan of Perry Mason, not only for the involved detective stories that come together beautifully in the end, but for the explosive courtroom scenes which usually see Mason steal a march over his detractors - most notably Hamilton Burger, the district attorney- through some spectacular legal manoeuveres.

Perry Mason is a detective in the Sherlock Holmes mould - always proactive, bustling about (if not in person then through the Drake Detective Agency), and not averse to bending the letter of the law, if only to uphold its spirit. He is extremely ethical, and tremendously far sighted. Almost in all cases, he finds himself battling not only on his clients' behalf, but also on his own, since his investigations lead him against the state police machinery.

The thing I like a lot about the Mason books is that you could have read them before, yet they manage to hold your interest on a re-read, probably because the cases are so involved that you would forget most of the nuances and the actual culprit in some time (it took me only 12 months). Additionally, the foreword for each book has the author stress on some new aspect of forensic science or legal developments which are baked into the story. However, the best part is that the books remain page-turners, easy to read and able to build interest right till the last page.

Here's wishing posterity to the legacy of Perry Mason!

South East Asia

I dont think a lot of (market interested) people would forget this week in a hurry!



But I found this graph uncannily similar to the coastline of South East Asia - from Gujarat in India all the way upto Vietnam and China!

2008

The reason I've been sloth in posting on this blog (no posts in December!!) has been that I've been on a long vacation, the highlight of which was terminal Blackjack addiction in Las Vegas, not only for me but also my otherwise wise wife! The paradox is that there are so many things to blog about, that I probably wont be able to write about even one of them.

But first here's wishing everyone a very belated and very happy new year!

On Jan 1 2007, I had made 3 resolutions, which were pretty fundamental. They involved desired changes in my weight, career, and marital status. By a huge coincidence and massive doses of luck, I was able to fulfil all of them (alas, a few only temporarily!!). This hugely encouraged me to make some resolutions for this year as well, and I have given this matter some desultory thought over the past couple of weeks. Unfortunately, I was unable to come up with very fundamental resolutions, which I could keep. So here are some relatively light ones, which I will document here, and judge my performance against at the end of 2008:

1. Limit alcohol intake to once a month (wine not included here since I usually dont swill wine uncontrollably)
2. Wake up early (i.e. early for me - 6:30 am) each day
3. Contribute significantly to charity at least twice in the year
4. Learn a new activity - either Karate or some form of dance
5. Push myself harder professionally

Would be good to hear about your resolutions as well!

Thunder pe Wonder

Q: If Agent Vinod, Gunmaster G-9 and Agent 116 (hint: these are NOT fictional characters!) came together to save the country from an attack by giant locusts, what would their war-cry be?

A: Thunder pe Wonder!!

Couldn't stop laughing once I read this article (thanks to Mint)

Excerpts here:

The first desi Bond was Jeetendra in Farz (1967). Gopal or Agent 116 of the Indian Secret Service was still quite a homeboy, with his remarkable exclamation, “Thunder pe wonder”, and his white trousers. He meets Sunita (Babita) in the course of investigating the death of another agent and finds that the trail leads to Sunita’s dad.

The next year, we had Sailesh Kumar, who played a spy in Goldeneyes Secret Agent O77 in 1968. If you do not remember who Sailesh Kumar was, don’t let it worry you. No one else does.

This was followed by Agent 999 Operation Jackpot in 1972. Perhaps these flopped badly for it took a while for Rajshri Productions to start Agent Vinod, played by Mahendra Sandhu, which they released in 1977. The story established a pattern that almost all the others were to follow. A scientist (Nasir Hussain) is kidnapped. The government sends in Agent Vinod, who is helped by the daughter of the scientist (Asha Sachdev).

The only James Bond knock-off to be a hit was Suraksha (1979), in which Mithun Chakraborty played Gopi alias Gunmaster G9, with M played by Iftikhar at his school-masterly best. Suraksha’s most memorable moment was a graveside sequence. One of the Indian intelligence agents, Jackson (Suresh Oberoi), has been killed by the nasties. When the Indian intelligence agencies dig him up, they find pieces of plastic in his grave. Some uncredited extra utters the immortal lines: “Sir, ispe to plastic surgery kiya gaya hai (sir, he has had plastic surgery).”

Director Ravikant Nagaich tried to recreate the glory of Suraksha with Wardat two years later, in which Gopi came back when the nation was under attack from large locusts—but it flopped. Trade pundits opined that this was because Indian audiences could not take the idea of Gunmaster G9 being unfaithful to Ranjeeta, the heroine of Suraksha, since Kaajal Kiron was now playing the daughter of the kidnapped scientist and the G9 girl. It might well have been that it was just a very bad film.

A better mousetrap

An article that I chanced upon today... amazing to learn of the varied ways in which people make a living in our country!!

Rat trap brings prosperity in rural India

Seema Hakhu Kachru in Houston PTI November 29, 2007 16:18 IST

Better rat trap seems to have improved the lives of many people in rural tribal area of India, as it has opened doors for more money, access to better health care and schools, and improved social status.

That is what a researcher from the Neeley School of Business at Texas Christian University found when she visited and wrote a case study on the Irula tribe of southeast India whose main source of income and food comes from catching rats in farmers' fields.

The case study -- Building a Better Rat Trap: Technological Innovation, Human Capital and the Irula ?iri Terjesen of TCU in Fort Worth, will appear in the next issue of the academic journal Entrepreneurship Theory and Practice.

"It's hard to believe there's a whole group of people that still catches rats for a living," says Terjesen, an authority on entrepreneurship, strategy, and international business. "Until I visited the project, I was skeptical such a dramatic change in people's lives could be achieved. The Irulas are a great example of how bringing technology to the rural poor can help them improve their lives one step at a time." Sethu Sethunarayanan, founder and director of the Center for the Development of Disadvantaged People, an organisation dedicated to aiding the Irulas, enlisted the help of a mechanical engineer to make a rat trap that is effective 95 per cent of the time compared to the old method which was successful only 40 per cent of the time.

The results: Irulas using the new traps have doubled or tripled their incomes, greater numbers of Irula children are going to school, and more Irulas are receiving health care. The tribe may also be enhancing its social status, as other Indian peoples see the success the Irulas are reaping from improved rat-catching technology.

The Irulas' main source of income and food lies in catching rats in farmers' fields, on which they have barely been able to survive. In fact, some Irulas have starved to death over the years. But now assistance in the form of a more efficient rat trap is helping some tribal members to help themselves. Traditionally, the Irulas catch rats by lighting a fire in a clay pot, then using their mouths to blow air through a small hole on the bottom to force the smoke into a rat burrow.
The Irulas then dig out the stunned rat, along with any grains the rat had accumulated. The rats and grains are primary food sources for the Irulas. Farmers, who can lose up to 25 per cent of a crop to rats, pay for every rat removed. However, the clay-pot method of catching rats is successful less than half of the time, and the average rat catcher makes the equivalent of $15 to $30 per month, below the USD 35 deemed necessary for basic needs. Rat catchers also suffer from health problems, such as burned lips and hands, and smoke inhalation resulting in respiratory and cardiac illness.

Upon seeing the hardships of the tribe, Sethu and the CDDP sought to develop a better rat trap. Sethu and a mechanical engineer designed a steel trap, with a wooden handle to prevent hand burns and a crank to eliminate smoke inhalation and lip burns. He then requested feedback from the Irulas, to make sure the design met their needs. Sethu and the CDDP then applied for and received a $98,500 grant from the World Bank to help the Irulas make the new rat traps. After identifying the neediest Irulas among 170 villages, the CDDP selected 1,500 participants to make, earn, or purchase the traps.

The CDDP set up a small factory in an Irula village and hired 50 young women to run it. Since men and boys were expected to catch rats, and married women were expected to take care of domestic duties, hiring unmarried women was the best way to avoid disrupting their culture. The factory operates without electricity, utilizing hand tools, and has produced some 2,000 traps so far.

The traps are sold to the Irulas for approximately $25 apiece.
"In the past, the Irulas were given things for free by higher-status social groups and non-governmental organisations. But they found many of these things were useless to them and developed the view that unless they work for what they receive, the item doesn't have value," says Terjesen.

With the new traps, the rat-catching success rate is 95 per cent, and the Irulas are proud of their first use of mechanised technology. Also, participating Irula families can afford to send their children to school, a promising development for a tribe that has 99 per cent illiteracy.
"Many Irula children now go to school instead of catching rats," Terjesen says. This is all just the beginning, however. Approximately 3 million Irulas live in India, and only a relative few have been helped so far. Sethu and the CDDP hope to expand the project, says Terjesen. "As India becomes more globalised, it's important that large portions of its population not be left behind," she says. "So many more people could eventually be freed from the cycle of poverty."

Wow!

A 23 year old Delhi girl is one of Business Week's Asia's 25 Youngest Entrepreneurs.

Her company, DesiCrew, has a simple business idea - a distributed BPO model. Essentially, they find 10-15 educated people in rural areas, train them, and get them to do non-voice based BPO work (such as claims processing, data entry, transcription etc).

Companies find them useful since they are cheaper to work with, and face little attrition. Finding the right talent in each village is a bit of a problem, but the enterpreneur claims that with longer training, they do come up the skill curve. Connectivity is taken care of, since the small BPO shops are set up using technology and wireless kiosks from nLogue, another startup incubated at IIT Chennai.

Needless to say, it works well for the employees, since they can stay in their own village, and save more money than in a big city. And it bodes well for consumption in the countryside as well.

The company is 10 months old, and have 60 employed people already. They plan to ramp up to 200 people in a few months. I'm not sure how the economics work, but working out some rough numbers, I estimate that capital expenditure of Rs 50,000 would have to be incurred on each seat established (incl. computers, furniture, network equipment etc). Indian BPOs typically work at $4 / hour for low end work, so if one assumes half this rate as billing rate for the distributed BPO, it gives the company revenue of Rs 16,000 per month per employee. I think employees would be happy with Rs 6,000 - 8,000 per month as salary. Overheads, connectivity etc. would be another Rs 2,000 per seat per month. Essentially, you recover your capital investment within 8-9 months of employment, and after that it is all profits.

The girl in question had to work quite hard for this though! She quit her job in Delhi and camped out in Chennai and surrounding villages for 2 years, preparing groundwork for DesiCrew. She was helped by the incubation cell at IIT Chennai, of course, but it still must have taken enormous amounts of courage and belief in the time that it took to prepare.

Hats off to her!!

Theatre at home

My parents gifted us a Sony home theatre system recently. I saw my first movie on it yesterday, and it was FANTASTIC!! Even though the speakers are yet to be installed in the correct acoustic manner, just the sheer feeling of watching a Dolby 5.1 DVD on the new system was just spectacular.

The Dolby 5.1 standard essentially means that each sound byte is split into 5 different components, and each speaker (there are 5 speakers in all) throws out one component of the sound. Ergo - absolute cinema-hall-like experience!

I saw an action movie, and the room actually vibrated with the explosions on screen. Even FM radio takes on a new timbre when heard on this new system.

But all this is not good for the wallet! Now I will be compelled to buy the DVDs of all the movies I like, just to enjoy the bliss of watching them again on this cool machine.

India's own sub-prime?

I came across this news article in the Economic Times today:

Small towns overtake metros to procure home loans
28 Nov, 2007, 1220 hrs IST,Shankar Raghuraman, TNN
NEW DELHI: Forget the metros; it is the smaller cities in India that are really witnessing a housing boom. Sample this: every fourth household in sleepy Gangtok took a housing loan from a scheduled commercial bank in 2005-06; over one-fifth of all homes in Bhubaneshwar did the same that year. At an average of barely Rs 3.4 lakh per housing loan, the residents of the Sikkimese capital may not be able to match the residents of the metros when it comes to the size of the loan, but in terms of the sheer proportion of families that are borrowing to have a nest they can call their own, small-town India is on the march.

If true, this is absolutely stupendous!! One out of 4/5 households in Gangtok/Bhubaneshwar took a home loan in one year! Is Sikkim or Orissa the new El-Dorado of real estate? Not very likely! Then are these loans justified macro-economically?

The question that springs to mind is - are banks building the platform for a large rise in non-performing loans? Already the more aggressive banks have been hauled up by the judiciary and the media for resorting to intimidatory tactics to recover credit. And anecdotal personal experience tells me that property prices have actually cooled off this year.

Will we too see our very own sub-prime crisis? I would like to find out the dominant banks in Sikkim and Orissa, and short them for a couple of years, once they start feeling the pinch of these excesses - seems like a sure trade to me!!

Errata

For yesterday's lazy post - the correct word is:

supercalifragilisticexpialidocious

And it is on dictionary.com. For those interested, check the meaning right here

Hot pakoras

Thanks to wifey dearest, I learnt a new trick today - the making of delicious pakoras. Popularly feted as the ideal combination with piping hot tea for a winter evening, pakoras have always charmed me no end.

The pleasant surprise though was the fact that it is fairly easy to make 'em. And they can be made ready in double quick time. And offer room for creativity (i.e. apart from potatoes and onions, one can make them from chillies, mushrooms, cauliflower, whatever).

One particularly spicy green chilly pakora that i had yesterday still lingers in my mind, and on my tastebuds!! :-)

Don't Panic

As I write, the BSE Sensex is down by 700 odd points and the bottom is coming off the market. I am reminded of the wise words from the Hitchhiker's Guide to the Galaxy (the one which has only a 2 word entry for Earth: mostly harmless): Don't Panic!!

I'm going to take a BIG risk and place my not-inconsiderable foot firmly in my mouth - I think this is more or less the low point. So hang tight (if this sort of thing interests you in the least), double your bets, and get set to rocket away...

Believe it or not, I also have a shopping list of favourite stocks!! Mail if interested...

Trivial pursuit

In these days of sub-prime and non-existent debt markets, my mind is stuck (surprisingly enough) on:
supercalafragalisticexpealadocious

(I hereby admit that I had to google it - I could not get beyond super cali fragalistic by memory).

m-w.com claims that it does not know this word. It offers no suggestions also..
Urban Dictionary does better, but I can't trust it.

Dilemma! I'm too lazy to find out the truth...

Circularity

After a particularly rough day at work today, I am surrounded by many questions which point to uncomfortable answers.

For instance, what is the point of all this stress? I certainly know what I am giving up - time, which will never come back, my health, and peace of mind. What am I getting in return? Material comfort, security, experience perhaps. But are these qualities / skills that I cannot get without incurring this stress?

Another one - what is the materiality of all my existence? What am I doing that is unique and which cannot be done by someone else? Am I even trying to make a difference? I am trying to get ahead, certainly, but ahead in which queue? At the end of it all, will I be at the front of a queue of lemmings?

Third - why do trivial things like this affect me so much? Poverty, global warming, injustice are issues that are humungously more significant to my future life than any of these infrequent irritants. Yet I let these inconsequential issues take on a much larger significance in the here and now.

Fourth - what am I going to do about it? Other than writing this blogpost, i.e. I obviously dont have the appetite for radical solutions. And incremental solutions probably wont matter.

Chickens come home to roost...

I have had a very cordial relationship with ICICI Bank till now. But a couple of incidents in the last few months have severely damaged my confidence in them, so much so that I am now moving out all my business from them.

And looks like I am not the only aggrieved party- check this out

But coming back to one of the issues under discussion - I have a trading and demat account with ICICI Direct, the documents of which apparently got washed away from under ICICI's care during the famous Mumbai flood. After that began an iterative series of events, which if had been happening in a movie, I would have found distinctly funny. The series would go something like this -
1) ICICI Bank would send me a strongly worded letter, saying I should contact their call center to re-execute all documents, or my account would be frozen
2) I would do that asap and get a request number
3) Nothing would happen for 3 months
4) ICICI Bank would send me a reminder
5) I would call up the call center and they would give me another complaint number, assuring me that someone would remedy the situation soon
6) Nothing would happen again
7) Back to step 1

This funny series of events happened 3 times. Now suddenly I find my account has been frozen. On contacting the call center again, I am back to step 5 above for the last 2 times. The most frustrating part of this is that there is absolutely nothing else I can do.

I have written a complaint to the ICICI COO (email id on their website), and have got the following reply from them:

From: Escalations - Webtrade COO (coo@icicidirect.com)
You may not know this sender. Mark as safe Mark as unsafe
Sent:
Tuesday, October 30, 2007 10:11:30 AM

Dear Mr. Shrivastav,

We have forwarded your concerns to the team concerned to arrange our executive to assist you in submitting the re-execution forms on priority.

We will reply you with the status in three working days.

Further, we apologise for the unpleasant experience and assure you that every effort is being made to ensure that such lapses do not recur.

Sincerely,
COO Team.

Needless to say, the 3 working days are long past, and nothing has come out of it. But what I would really like to know is this - is there really no other option for the small guy? How long can one be forced to take whatever crap these jokers dish out? And is there ANY accountability that ICICI Bank has? I suspect the answer is no.

Ha Ha! I KNEW this had to be true...

I dont need any excuse to chug beer, but for those who do, here it is!!

Courtesy rediff.com:

When you reach for an ice cold mug of suds after playing a game of football, cricket or a long run, you're not just quenching your thirst, you're actually doing something healthy for your body -- seriously!

Researchers in Europe have carried out a study and found that a glass of beer is far better at re-hydrating the body after exercise than water as the sugars, salts and bubbles in a pint help people absorb fluids more quickly. "The carbon dioxide in beer helps quench the thirst more quickly, while beer's carbohydrates replace calories lost during physical exertion," the Daily Mail reported on Friday, quoting lead researcher Prof Manuel Garzon as saying.

In fact, the researchers at the Granada University in Spain came to the conclusion after examining 25 students who were told to do strenuous exercise in temperatures of around 40C until they were close to getting exhausted. Half of the students were given a pint of beer to drink, while the others received the same volume of water after the workout. Subsequently, the team measured their hydration levels, motor skills and concentrationability. Prof Garzon said the re-hydration effect in the students who were given beer was "slightly better" than among those given only water. Based on the studies, the researchers have recommended moderate consumption of beer -- 500 ml a day for men or 250 ml for women -- as part of an athlete's diet.

It may be mentioned that past studies have revealed that sensible drinking of one or two units of beer a day could help reduce the risk of heart disease, dementia, diabetes and Parkinson's disease.

The hunt for fancy places

My office is in Connaught Place in Delhi. For those who dont know much about Delhi, it is pretty much the geographical center of town.

Often, on Friday evenings, I ask my wife over to pick me up from office, and plan an evening out. We are constrained by the fact that we dont want to leave one car behind in my office, and so we need to go to places nearby, so that we can pick up the other car while leaving for home. A couple of weeks of this, and we have already exhausted most places where we can get dinner and generally hang out.

We have made a couple of good discoveries in our adventures though. One is the bar at the Shangri-La. This place has a couple of performers who sing REALLY well (and all our favourite songs too!!), and is not too crowded or smoky. The other is a restaurant that goes by the name of Veda. The decor is dark and antique, the food good, and the service excellent. The wine list, though expansive, is not very reliable. And prices are not too bad.

But now we are pretty much at the end of our tether...at least in and around CP. Any new ideas are always welcome!!

PNs and all that...

Those that punt on the stock market would know something of the bourhaha that has been happening the last few weeks over SEBI's circular proposing a ban on Participatory Notes (or PNs as they are popularly called).

The BSE Sensex has gone from being on a spectacular uptrend, to being locked at the 10% lower circuit, to gaining the largest single day rise, all in a matter of 2 weeks.

Without going into the technicalities of the matter, and in no way trying to undermine the copious amounts of opinions, reports etc. etc. in the media, all I can do is look and yawn...

As much as I see it, this noise over P-Notes is an annual occurance, and is just a cooling mechanism that the market finds for itself. It usually results in a sharp fall with a sharp rise in volatility, and enables new buyers to come into the market. In other words, it is just evolution.

So I look at it as a golden opportunity for going long. Now only if I had any capital :-(....

Leverage

I was reminded today of the power of leverage. I was shooting breeze with a couple of friends, and one of them mentioned the following (true) anecdote.

This buddy of mine is a banker, and was talking about the bad old days of '03, when bankers were lucky to hold on to their jobs, and no bonus in sight. During such desperate times, with liabilities in the form of student loans, this canny dude bought a house in South Delhi worth 1.25 crores with just 15 lacs of equity, the rest leveraged as debt. The house is today worth 4 crores, and there is still Rs 80lacs outstanding on the loan.

To work out a simple equation, 15l has grown to 3.2cr in 4 years, or 21 times return. This is an annual return of 114%!!

Harnessing the power of 1) leverage and 2) real estate seems like a quick way to untold riches!!

To the big apple and back

First, the good news - my country count has gone up by 1. The big one - the USofA is done with. The largish (big is not big enough a word, and giant is too big) apple has seen one more soul pass by.

Now for the middling news - its no great shakes. Times Square, central Manhattan, Broadway are kind of ok.. a bit touristy, massively densely populated, of course. Though not pretty, what with the sky not very visible amidst the giant towers all around, yet not foreign either. Truly cosmopolitan and not at all unwelcoming (which Europe can be, I must confess!!) It didn't help, of course, that I had to travel for 36 hours each way to spend 36 hours in the damn place. The resulting jet lag was quite an experience, to put it mildly.

And now for the bad news - one of the torchbearers of the Indian renaissance disappointed me. Jet Airways, with its promise of great service, flat beds, all new aircraft, great food, etc etc seemed the ideal airline to fly. And yet, twice within the week, once while going and then on the way back, the supposedly new aircraft developed technical faults - resulting in a delay of 14 hours at various airports one time, and a relatively mild 3 hour delay at the other. Though I must admit here that once the damn planes did take off, the experience was quite quite nice (among other things, great crew, and the most amazing movie - Paris Je' T' Aime with the perfect accompaniment - a nice bottle of red wine - but more on that later). But I think Jet needs to pull up their socks especially on punctuality and maintenance if they are to compete with the BAs and the Continentals of this world, let alone Singapore Airlines or Cathay. Would be interesting to see how Kingfisher fare when they start international service - though of course I think they will start with flying Deccan to the gulf.

All in all, the week was nothing to write home about!!

Johnny G

I saw a movie recently after a fairly longish time. With a rather unusual title, Johnny Gaddaar is actually a great viewing experience. I found it quite gripping and real. And though quite violent, the story kept my interest alive at all points.

The movie tells the story of a gang, each of which could be out to double cross the rest, and how coincidences and twists and turns keep each of them guessing about the motives of the others. I wont detail out anything else in this post though...

The music is also good (the movie thankfully only has very brief snippets of the songs, Hollywood style) and the acting competent.

Altogether a good watch. I'm also hoping to watch another strangely titled movie soon. This one is called Manorama, Six Feet Under!!

Interesting conversation - rooted in economic theory

This is an email I received today. It is about an apparently true conversation that took place on a social networking website:

What am I doing wrong?


Okay, I'm tired of beating around the bush. I'm a beautiful (spectacularly beautiful) 25 year old girl. I'm articulate and classy.
I'm not from New York. I'm looking to get married to a guy who makes at least half a million a year. I know how that sounds, but keep in mind that a million a year is middle class in New York City, so I don't think I'm overreaching at all.

Are there any guys who make 500K or more on this board?
Any wives? Could you send me some tips? I dated a business man who makes average around 200 - 250. But that's where I seem to hit a roadblock.
250,000 won't get me to central park west. I know a woman in my yoga class who was married to an investment banker and lives in Tribeca, and she's not as pretty as I am, nor is she a great genius. So what is she doing right? How do I get to her level?

Here are my questions specifically:

- Where do you single rich men hang out? Give me
specifics- bars, restaurants, gyms
-What are you looking for in a mate? Be honest guys, you won't hurt my feelings
-Is there an age range I should be targeting (I'm 25)?
- Why are some of the women living lavish lifestyles on the upper east side so plain? I've seen really 'plain jane' boring types who havenothing to offer married to incredibly wealthy guys.
I've seen drop dead gorgeous girls in singles bars in the east village.
What's the story there?

- Jobs I should look out for? Everyone knows - lawyer, Investment banker, doctor. How much do those guys really make? And where do they hang out? Where do the hedge fund guys hang out?

- How you decide marriage vs. just a girlfriend? I am looking for MARRIAGE ONLY

Please hold your insults - I'm putting myself out there in an honest way. Most beautiful women are superficial; at least I'm
being up front about it. I wouldn't be searching for these kind of guys
if I wasn't able to match them - in looks, culture, sophistication, and keeping a nice home and hearth.


And then the reply:


Dear Pers-431649184:
I read your posting with great interest and have thought
Meaningfully about your dilemma. I offer the following analysis of your predicament. Firstly, I'm not wasting your time, I qualify as a guy who fits your bill; that is I make more than $500K per year. That said here's how I see it.
Your offer, from the prospective of a guy like me, is plain and simple a cr@ppy business deal. Here's why. Cutting through all the B.S., what you suggest is a simple trade: you bring your looks to the party and I bring my money. Fine, simple. But here's the rub, your looks will fade and my money will likely continue into perpetuity...in fact, it is very likely that my income increases but it is an absolute certainty that you won't be getting any more beautiful!
So, in economic terms you are a depreciating asset and I
am an earning asset. Not only are you a depreciating asset, your
depreciation accelerates! Let me explain, you're 25 now and will likely stay pretty hot for the next 5 years, but less so each year. Then the fade begins in earnest. By 35 stick a fork in you!
So in Wall Street terms, we would call you a trading position, not a buy and hold...hence the rub...marriage. It doesn't make good business sense to "buy you" (which is what you're asking) so I'd rather
lease. In case you think I'm being cruel, I would say the following. If
my money were to go away, so would you, so when your beauty fades I need an out. It's as simple as that. So a deal that makes sense is dating, not marriage.
Separately, I was taught early in my career about
efficient markets. So, I wonder why a girl as "articulate, classy and
spectacularly beautiful" as you has been unable to find your sugar daddy. I find it hard to believe that if you are as gorgeous as you say you are that the $500K hasn't found you, if not only for a tryout.
By the way, you could always find a way to make your own money and then we wouldn't need to have this difficult conversation.
With all that said, I must say you're going about it the right way. Classic "pump and dump." I hope this is helpful, and if you want to enter into some sort of lease, let me know.

Nostalgia

My 5 secs of fame (bright red striped t-shirt) - always with my back to the camera though :-(!!
For those who are not from IIMB, apologies for posting something very topical!
For those who don't visit the class of 2004 blog, FYI -

Flinched

Saw this on Gullu's blog and liked it enough to flinch it (but not without acknowledgement :-) As they say, there is a fine line between inspiration and imitation...

From childhood's hour I have not been
As others were; I have not seen
As others saw; I could not bring
My passions from a common spring.
From the same source I have not taken
My sorrow; I could not awaken
My heart to joy at the same tone;
And all I loved, I loved alone.

- Edgar Alan Poe

Service

I've realised something recently that gives me patriotic joy - the Indian hospitality industry is far more advanced than our western counterparts.

During my work at my previous job, I would often stay in hotels in different cities in India. Though expensive and tough to book into, the quality of service, food, promptness of staff were all exemplary. The Taj, Oberoi and even ITC Welcomgroup chain of hotels all met this quality bar nicely.

Contrast that to my recent experiences. In Phuket, I lived at the Hilton. Nice rooms and great views, but once when I was ravenously hungry and ordered some food and tea, the room service manager refused to serve anything, saying that they were short of staff!! After some cajoling, she finally agreed to send something after 60 minutes, and after 120 minutes of waiting, I was almost eating the pillows!! This was not a one-off during the week that I was there.

Similarly, the Marriott in London has got a great location, but the service leaves much to be desired. For one, it is devilishly expensive. But we can let that pass. After having my clothes misplaced, and after not getting a wireless broadband signal inspite of paying a bomb for it, I have formed a pretty unflattering view of the place. And the gym they have is a joke!

I've had not too great experiences with the Westin in Sydney, the Millennium in London too. But the Taj in Mauritius was awesome. The Indian connection? A lot of my European colleagues who have been to India and stayed at hotels there hold similar opinions.

I think its time for Indian Hotels, ITC, Asian Hotels and their ilk to go out and conquer the world. Maybe I should buy their stocks in anticipation!!

London

I've been in London for about a week now, and it is delightfully European! With the benefit of the English language as a bonus!! :-) (though to be absolutely honest I still need to get used to the strong accents here).


London must definitely count as one of the most beautiful cities in the world. Very old world and graceful in its architecture, no buildings over 3 storeys tall and greenery everyewhere, the city is ideal for walking about. And it is also the home of capital and enterprise - every pretty house I see has a discreet nameplate in front - xyz Capital or abc Partners. Hedge funds and capital pools abound in plenty. Not very surprising, given that the English were the original bankers to the world (or was it the Swiss? - I suspect it was the English, and the Swiss got their fame for being discreet)

London is frightfully expensive. And not expensive when compared to India, it is expensive when compared to Tokyo, or mainland Europe. A modest meal would set one back by an average of GBP25, and lodging is just plain unaffordable (my colleague here pays about GBP2,000 per month for a 500 sq ft apartment in a not-so-central locality)!! And when I venture into the big shopping places on Oxford Street, I usually marvel at the fact that anyone is buying anything at all at these rates!

London is also distinctly English! Understated, solid and polite to a fault! More conservative than the Europeans (no topless sunbathing in public parks in London!!), and much more cosmopolitan. The last week, I've feasted on Japanese, Lebanese, Italian, Indian, American and English food (the last could perhaps be an oxymoron - fish and chips is what I'm alluding to :-)
Though surprisingly, I haven't found any English ale or beer easily available - most alcohol is the standard European / global stuff. The office I work in has only a couple of Brits - the others are all German / Dutch / American / other Europeans.

The best part about this time of the year in London is the fact that it is daylight from very early morning to about 9:30pm. Getting out of office at eight is such a pleasure, because it seems to be afternoon still! Speaking of which, Londoners are also full of the same work ethic as Americans - very little chatting or socialising in office. No one breaks for much, and even lunch is a hurried affair - usually take-out food eaten on the desk.

One other oddity I noticed is the English fascination with lions. Surprising, given that the UK didn't have any of its own! All public places, sculptures, coats of arms MUST have a couple of fierce lions! And one of the most famous kings of England was Richard the Lionheart!
Speaking of oddities, I must mention here the Brit cab. It looks quite weird, unlike any other car I've seen - a bit like an Ambassador, but more like a horse buggy!! The inside though is very spacious and comfortable. I wonder if its manufactured only to be used as a London cab, because I certainly haven't seen the car anywhere else. But then maybe its a bit like the fact that all Fiat cars in India are found running as taxis in Bombay..

Unfortunately I have no photos - my wife is our official photographer, and she is not here with me :-( But then I dont think photos could do justice to this beautiful city.