Is the Subprime Crisis Over!

Yesterday my friend told me that he has heard that “Subprime crisis is over “ and it is this news which is making the Sensex go up. I was really puzzled hearing it and started laughing after that.

 We all know that subprime crisis is far from over , but who will declare it once it is over , what is the methodology and procedure to actually verify if someone says its over .These  financial crisis are so huge and affect so many economies , even to find the real impact of them is so tough . During Asian Financial crisis of 1997, it took many years and many declarations by prominent leaders of financial community to make the markets believe that the crisis is over.

I hope my friend is right and we see a better managed financial world past subprime very soon.

Dream Car finally a reality ..

When everything starts going all wrong for a particular dream of yours, than its nothing but a celestial conspiracy , to check your capability , to check whether you are determined to  make that dream of yours into reality  .The final outcome will be nothing but pure brilliance which will give you tears of Joy and happiness.  I have seen this happening time and again with people; nothing comes easy in this world. Follow your dreams, for as you dream you shall become.

Today when Tatas has finally launched their Dream Car, I really feel elated about this new beginning. This ain’t an ordinary car or another reverse engineering wonder but it’s something which has changed the whole dynamics of the auto industry in India.  People are saying that it’s the biggest product from India so far, Lets hope it’s only the beginning and we are going to see whole new era of innovation and creativity not just in making better products but marketing and selling them in different parts of the world.

IPL Blues…

Indian Premier League (IPL) launched just a year back was a big hit in the Indian subcontinent and the best part of it was the win-win situation, everyone was getting benefitted out of it. The players which could not make it up to the Indian team were getting great remuneration and high visibility which was at par with the international players, government was getting tax revenues and a chance to showcase India, TV channels were making loads of money through advertisements , the sports infrastructure of the country was benefiting out of the events and people were just loving it as it was their daily dose of affordable entertainment, better than the regular soaps which they have to watch. The 20-20 format was very entertaining and the time format of 2 hour game made it all exciting for even the people who don’t like to watch cricket all day.

The attack on Srilankan Team in Pakistan has caused more damage to IPL than any other event in the world. It is a classic case of a Black Swan as termed by Mr Nassim Talib in his book ‘The Black Swan’. As per Mr Talib Black Swans were debated not to be in existence and it was only before scientist found the rare breed in Australia that people realized the existence of Black Swan,  it’s a low probability event with high damage potential and nobody usually think of it in normal circumstances. A Mumbai attack through local boats or a 9/11 through passenger aircraft is a classic Black Swan which nobody thought will occur. The insurance companies never included this probability in calculation of their premiums and suffered badly from it.

Mr Lalit Modi is trying all out to make the event possible but who will take guarantees of guarding the lives of players when our own Home minister has refused to provide security to the teams during election season. Even if someone takes guarantee, the International Player might still reject the offer due to fear of attacks. Time is not far when people will start paying for their own security to outside intelligence Agencies. It does sounds like a good business proposition ‘Private Intelligence Agencies ‘?

Can India and Pakistan Coexist?

If we see the geographical location of India, it is surrounded by so many unstable nations. Srilanka is fighting LTTE , Nepal is struggling with maoist , Afganistan is still occupied by Taliban , Military is trying to overtake Bangladesh and worst of all a nuclear power in the form of Pakistan is struggling with democracy and homegrown terrorism. The condition is not very fruitful for a friendly nation like India who is trying to improve the condition of its economy by attracting foreign investment.

The only stable country can be seen in the form of China which does not share a history of good relations with India. We are still having issues over borders and they don’t recognize some part of Indian territory. What will be the future of India with so many issues surrounding it from all sides?

The world now is slowly realizing the importance of peace and the downside of terrorism as everyone is suffering from it. The bigger question becomes, Can India and Pakistan coexist with such tensions building up in the face of instability and terrorism as rest other problems are not as huge as relation between two of the nuclear economies of the region. What would have happened if the team attacked by terrorist in Pakistan was Indian? It could have led to yet another war.

With Pakistan suffering hugely from the terrorism and in the aftermath of attacks on the Srilankan team even the people of Pakistan have realized how home grown terrorism can harm any country. In the future they might vote for a more India friendly government who wants to actually improve their economy rather than sponsoring terrorism in India. The anti Indian venom which is being taught through modified history books in Pakistan has to change in order to ring the two countries closer which share the common culture and history.

If we see the countries in Europe, they are living peacefully , even after waging so many wars against each other in which millions of people lost their lives. Gradually things start moving and every one realized that war and hatred cannot bring prosperity to any nation. Now Europe is one of the most prosperous region in theworld and they are even sharing the same currency.

I am very hopeful that in future Pakistan will curb the terrorism as they would require it to survive in the interlinked economies of the world . It will require a lot of change in the way they think about their future. I hope they change.

Crowd Behavior, Social Networking and financial Decisions ..

Majority of our decisions are based on how others are doing it. Crowd behavior gets mostly influenced by the social network one maintains. Most of the people invest in stocks as his neighbor is investing and making money in it. Most of the people invest their hard earned money in risky trades without any knowledge of market, As Shankar Sharma of ‘First Global’ gives the analogy of a revolver with only one bullet in it, and the investor is asked that he will earn a million if he tries it on himself, few people might get richer in such games but end of the day more people shoot themselves rather than earning the money. The probability of becoming a millionaire is getting reduced by every trial and the rule of the games also keeps changing. Nobody knows if there is only one bullet in the gun.

Social networking is giving way to a regular crowd behavior pattern which is very prominent in many ways: -

1. Increased Information Levels: - Social networking keeps people informed about others and leads to an increasingly informed society. Such level of information might not be very useful for all.
2. Comparisons in Society: - Increased information about friends and peers leads way to comparison of decisions, similarity in life style and even peer pressure at times.
3. Peer Pressure: - (From my earlier Blog) When we talk about the art of decision making and psychology behind it, we believe that peer pressure has the most significant influence behind our decision making. We may live our own life but the rules of the life are mostly defined by the people with whom we work or study. The reason is simple, we spend a significantly high portion of our time with them and hence their personalities and reactions affect our decision making process. The more important the decision, the more is the peer pressure. Infact even the decision of selecting a job or going for higher studies is sometimes influenced by the peer pressure. People constantly fear that they will be judged by other people on the basis of their decision.
4. Financial Decision Making: -Financial success of peers and friends whom a person can easily associate in his network motivates other people to take similar risk or even at times more risk than a person can actually afford. Social networking thus makes you believe that you can also achieve the similar level of success in financial decision making.
5. Incentives and Recognition: - Social networking also prompts a person to take increased risks as the society can make a hero out of him if he succeeds in his plans and financial decision making. The improved recognition in the society acts as a big incentive in making financial choices for a person.

Right Path ..

In the recent visit to Seattle I learned a lot about the basic philosophy of Social Entrepreneurship; It’s a way doing well by doing good. The level of concern about raising the standard of living of the people of developing world was truly amazing. I actually found people with extreme consciousness, who don’t choose to shop in Walmart as it might be exploiting human labour or choose body shop as it is environmental friendly. It clearly showed the importance of Corporate Social Responsibility in the future for building brands and selling products. People might say it is a marketing gimmick , but this gimmick will become a necessity for most of the companies to survive.

Our trip started with a visit to Path, a Seattle based NGO working with technological innovation in order to improve the health of the under privileged. They showed us their various projects most of them have been developed by in house research. 

Few of the products I liked were

1.         Safe disposal system for syringes so that they cannot be reused and the spread of diseases like AIDS can be prevented

2.        Fortified rice where every 100 kernel of the rice is fortified with extra vitamins and minerals to provide extra nutrition to the under nourished people.

3.       Small kits for the safe delivery of babies in rural areas where medical help is not easily available.

4.        Sticker which can be pasted on Polio vaccine which indicates if the vaccine is suitable for use.

Path forms partnerships with the local partner in developing world to transfer technologies and monitors the whole process very keenly. The local partnership helps Path in providing culturally relevant solutions to the people. I was really impressed by the kind of work this organization is doing which actually has great impact on the lives of millions.

GSEC provided us a platform where like minded people discussed their ideas to improve the conditions of our society . It may be a very small beginning where most of the ideas are still on paper but it was definitely very encouraging and motivating for all the people attending the summit.

New York Darshan in 5 hours ..

On 20^th morning we landed in New York (NY) at around 6:00 am in the morning, the flight to our ultimate destination Seattle was at 2:00 pm local time. We thought of trying to prepone our flight to Seattle but there were lot of confusions regarding transfer of baggage etc, finally we ( Raka , Bedi , Srejith and me ) decided to just kill the time sitting at Newark Airport . The rest of the story is nothing less than a adventure ride, full of twist and turns and yes a lot of FUN.

As we were looking for a place to sit, we met Manisha, a girl from Mumbai, smart and friendly .She was traveling through NY to some country in Latin America.  She insisted that we should go around NY .Initially we were skeptical but finally we agreed as she knew about the places in NY. We bought our bus trip return ticket from the counter and boarded the bus at around 8:00. The buses were really warm and clean.

 The city was really cold, and the cool wind which never stopped blowing was making our lives even tougher. The excitement was the only thing which was keeping us interested in moving out of the airport.

 We got down on Grant Station; the place was huge, had beautiful lights and looked clean and well maintained. It instantly reminded me of our CST station which is equally beautiful but no one cares to keep it clean. Their was lot of space but people were moving very swiftly in a typical NY style , may be because it was office time and none of them were jobless like us that time.

 After seeing the huge library we headed to the Time Square which I have seen so many times on TV and really wanted to see how it looks in real. The place was a real treat to eyes. So bright with lights and electronic hoardings even at 11:00 am in the morning, looked like the most happening place for marketing. We were totally amazed and just keep clicking the photographs in n number of poses which were all similar in a way.

We still had nearly 2-3 hours, hence we decided to take our chances to see the Statue of Liberty, the biggest symbol of freedom in USA .We took the suburban train and went to the World Trade centre and walked nearly 10 blocks to see the Statue which didn’t really excited me at all. The wind there was blowing even more swiftly and we all were just trying to survive the sudden climatic change.

Then came the bonus, something we didn’t thought of, the wall street BULL on which we have named our team as 'NMIMS BULLS'  one and a half years back and we had a dream run. The feeling was great. We quickly clicked a few pictures and walked briskly back to catch the train back to the bus stop to get back to airport

Luckily we reached the airport at 12:50 pm just to find that our flight has been a little delayed , we anyway reached on time in Seattle 

In all, a great start to the trip and all credit go to Manisha. Thanks alot !