As some one who was and still is keenly interested in geography, maps have always interested me. Features, landscapes, lakes, mountains ect. on the maps were something I was very good in my school days. This was one exam I used to love giving. I think I am still good at it. Questions like "Mark Satpura Ranges" or "Highlight Strait of Malacca" on a maps exam gave me a high rush, besides a high score.
These and so many of the geographical features are thought to be eternal, at least in our sense of the word 'eternal'. I know that over countless eons they will change or maybe no longer be there, but mostly in timescales that we think of, we just assume that nothing is going to happen to take them away and that they are there always. So I was in a bit of surprise when the other day during one of my geo-political fantasy study over Crimea, I in the map could not locate a rather roundish and big lake (so big they call it a sea) called 'Aral Sea'. I remember (from my school days geography exams) this to be a round big water body near the Caspian Sea in what used to Soviet Steppes. Now instead of a big lake, the Google maps shows this sea as a set of smaller lakes that nowhere look like my faint remembrances of the famed Aral Sea. In fact there is no big lake left, its feature has been taken over by much smaller 3-4 lakes that hardly merit attention as the giant Aral sea used to get in a map. In our lifetimes, the big sea has become much smaller unknowns and who knows may soon become an endless dry sea bed. So much for the 'eternal' earth. The sea is now 10% of its original size. A 70,000 km2 (sources:wikipedia) sea has been reduced to a mere salt plains by unplanned and unthoughtful human exploitation. I wonder if features on maps are eternal after all. Some to think about!
Showing posts with label assorted. Show all posts
Showing posts with label assorted. Show all posts
The Bitter Harvest Of Inaction
For the last couple of months the biggest narrative in India has been the near precipitous fall of currency and the dark clouds gathering over the economy. And this is when there are ample experienced hands at the deck. So many captains and yet no glories to speak of. Leave aside glories, the ship looks as if it has hit its underside on the rocks and is rapidly filling water. How could we have come undone so fast? See no further for what went wrong. It was not any action that caused it, it was years of inaction. It is just plain complacency. The spectacular growth mostly export fueled during the UPA-I years gave them enough reason that all is a-ok and growth will continue like this with any impetus. You know what, any captain can sail on a favorable wind. Even if you don't do anything, the winds pushes the ship forward. This is what actually happened. As long as global economy was strong, we were going mighty fast.
Then 2008 came and the bubble burst and our ship hit rough waters. But the so called Jack Sparrows of our economy kept repeating that all is well and we will soon return to 8%+ growth rates. No course correction was ever done. I always believe the Government is not their to take decisions that please the people. Who does not want subsidized LPG? Who does not want freebies? But can a country with very limited resources work like that. Can Government take decisions based on populist pressures? Or do nothing and hope things mend themselves. And all this has led us to where we are. Inflation is not really under control, growth rates that is sputtering, currency in free fall, foreign capital fleeing the shores and no new investment being done.
The problem is not global economy now for US despite of such a massive base grows decently while we manage measly growth on such abysmal economic standards. The problem is not even falling currency for that is a symptom of the malaise not the actual disease. The fever tells you that probably you have a bigger problem somewhere. What we have here is a perfect case of a self-afflicted wound. Policy inaction, multiple power centers, fiscal profligacy and just plain over-confidence. I don't pity the captains of this ship. They probably don't need it anyways. They will still manage well in their Lutyen's bungalows. We would also manage well. Probably one or two less movies or eating out in a month. But it won't be a easy ride for the countless millions joining the workforce every year or those at the margins of society. Couple of percentage of less growth will ensure millions will be left jobless. This minuscule growth will be a jobless growth for the industry will not hire unless they see momentum picking up. The powers that be will still fiddle over the definition of poverty line and how they moved millions of unwashed masses to so called "middle class". And there will be no easy way out of this troubled waters. No warm winds to help us come unstuck. It is going to be many years of discontent.
Then 2008 came and the bubble burst and our ship hit rough waters. But the so called Jack Sparrows of our economy kept repeating that all is well and we will soon return to 8%+ growth rates. No course correction was ever done. I always believe the Government is not their to take decisions that please the people. Who does not want subsidized LPG? Who does not want freebies? But can a country with very limited resources work like that. Can Government take decisions based on populist pressures? Or do nothing and hope things mend themselves. And all this has led us to where we are. Inflation is not really under control, growth rates that is sputtering, currency in free fall, foreign capital fleeing the shores and no new investment being done.
The problem is not global economy now for US despite of such a massive base grows decently while we manage measly growth on such abysmal economic standards. The problem is not even falling currency for that is a symptom of the malaise not the actual disease. The fever tells you that probably you have a bigger problem somewhere. What we have here is a perfect case of a self-afflicted wound. Policy inaction, multiple power centers, fiscal profligacy and just plain over-confidence. I don't pity the captains of this ship. They probably don't need it anyways. They will still manage well in their Lutyen's bungalows. We would also manage well. Probably one or two less movies or eating out in a month. But it won't be a easy ride for the countless millions joining the workforce every year or those at the margins of society. Couple of percentage of less growth will ensure millions will be left jobless. This minuscule growth will be a jobless growth for the industry will not hire unless they see momentum picking up. The powers that be will still fiddle over the definition of poverty line and how they moved millions of unwashed masses to so called "middle class". And there will be no easy way out of this troubled waters. No warm winds to help us come unstuck. It is going to be many years of discontent.
Thought Of The Day
It's been long since I have written on Indian polity, not because of there being any dearth of issues but because I believe that in the current set up the more things change the more they remain the same. What we are seeing today is a circus, a self serving act, self-deluding mockery that is being played with the tax payers money and common citizen's life. And I include opposition (of all shades and hues) in this charade. The problem are fundamental and yet fixable, yet no one is willing to fix them and it's not that they require some gigantic effort or big fiscal spend, they just require some imaginative thinking and resolve. But then creative imagination is not our strong point. Is it? I won't talk on it today, maybe some other day. Maybe not even on the other day.
Below the big headlines on any newspaper or news portal filled with some supposedly earth shattering news or gossip, below there lies a slow and steady stream of ruthless banality, of some miserable small death somewhere in the expanse of this big country. Accidents, suicide, human exploitation, mysterious diseases and criminal acts like murder/rape ect. These little read snippets of some gruesome incident often not stressed over in its singularity, yet when you look at how they are numbing the society, how they are killing people (and especially young people) you just shudder. 3000 people die on Mumbai trains yearly, a rape every 22 minutes. Over 150K killed mostly young people in road accidents in an year. Similar numbers for suicide. Every year the same story repeats for dengue, encephalitis ect. There are countless cruel stats like these. I can go on for ever. Yet, whats the point. Such miserable urban planning, no social nets for people who are clutching on to practically no hope. No rule of law to deter crime. No justice for the wronged. No adequate physical and social infrastructure. No proper health care for many who just give up. And on the top of it as if this was not enough, we ourselves do not seem to have commonsense to make the correct decision.
I think it is too much to ask. We are hoping for too much. For people of my age, (early thirties) who have seen both the old Bharat and the new India, we have already lived half of our lives where materially things may have gone comfortable (for some) yet the overall social indicators are still depressing. And I don't think things are going to get much better soon. We are or soon will be entering a demographic bulge where a whole generation will move from teens to employable age group and consumers The country and its infrastructure (both social and physical) is hopelessly short to handle this. Be it roads, be it housing, be it health care, be it courts or police. These mindless and numbing stats will just grow bigger and be still lost somewhere in this media circus or some chest-thumping rhetoric. They just didn't deserve that much respect, either living or either dying.
I just hope our children see a much better country. Something to think about!
Below the big headlines on any newspaper or news portal filled with some supposedly earth shattering news or gossip, below there lies a slow and steady stream of ruthless banality, of some miserable small death somewhere in the expanse of this big country. Accidents, suicide, human exploitation, mysterious diseases and criminal acts like murder/rape ect. These little read snippets of some gruesome incident often not stressed over in its singularity, yet when you look at how they are numbing the society, how they are killing people (and especially young people) you just shudder. 3000 people die on Mumbai trains yearly, a rape every 22 minutes. Over 150K killed mostly young people in road accidents in an year. Similar numbers for suicide. Every year the same story repeats for dengue, encephalitis ect. There are countless cruel stats like these. I can go on for ever. Yet, whats the point. Such miserable urban planning, no social nets for people who are clutching on to practically no hope. No rule of law to deter crime. No justice for the wronged. No adequate physical and social infrastructure. No proper health care for many who just give up. And on the top of it as if this was not enough, we ourselves do not seem to have commonsense to make the correct decision.
I think it is too much to ask. We are hoping for too much. For people of my age, (early thirties) who have seen both the old Bharat and the new India, we have already lived half of our lives where materially things may have gone comfortable (for some) yet the overall social indicators are still depressing. And I don't think things are going to get much better soon. We are or soon will be entering a demographic bulge where a whole generation will move from teens to employable age group and consumers The country and its infrastructure (both social and physical) is hopelessly short to handle this. Be it roads, be it housing, be it health care, be it courts or police. These mindless and numbing stats will just grow bigger and be still lost somewhere in this media circus or some chest-thumping rhetoric. They just didn't deserve that much respect, either living or either dying.
I just hope our children see a much better country. Something to think about!
Thought Of The Day
A mere customary glance of any Indian news portal makes a depressing read about the nation's state. It makes a sad reading. It really does. It's like Nero playing the fiddle while Rome burned. I read one apt couplet somewhere and want to quote it on the predicament this nation is facing. Maybe things will turn for good. Maybe, but i don't fancy the chances.
"jo shakhs tum se pehle yahan takht nasheen tha
usko bhi khuda hone pe itna hi yaqeen tha"
The person occupying the throne before you, was equally convinced of his divinity.
"jo shakhs tum se pehle yahan takht nasheen tha
usko bhi khuda hone pe itna hi yaqeen tha"
The person occupying the throne before you, was equally convinced of his divinity.
Story Of The Day
This is a story that I heard in the TV today about the state of polity there(Pakistan). Not even changing an iota of fact from the same story the story rings so true for India as well.
In a certain city in India (it could be any city in India or village for that matter) in not so old times (again the time can be any for that matter), a project was approved to construct a building for the common folk to be used as a school and medical center. An engineer constructed the building and in couple of years later he was transferred to a different location(as part of regular job rotation). Another engineer came to fill in his place and said that before he could take charge, he would like to see the building. When the two engineers went to building location, there was no trace of the building or it being ever constructed. The new engineer says that how can he take charge when there is no such building. The old engineer with glitter in his eyes says that he constructed the building, you just keep maintaining the building. The new engineer being old in the trade understood what it meant, signed the papers and took the official charge. He kept maintaining it for some years before he was also transferred to a new posting. A third engineer comes to replace him and in a similar fashion, contended that he will take charge only after inspecting the building. Both went to the building site and like last time, there was no trace of the building. The freshly arrived engineer accusing the existing in-charge for corruption, says that he will report this wrongdoing to his superiors that no such building was ever constructed and whole funds were misappropriated. The existing engineer with a whiff of confidence coolly places his hand on mildly angry new engineer and says that some previous engineer constructed the building, i was maintaining it and now if you want you can demolish it. There will be no need for inquiry and everything will be according to the rule of the land.
power corrupts...absolute power... corrupts absolutely
In a certain city in India (it could be any city in India or village for that matter) in not so old times (again the time can be any for that matter), a project was approved to construct a building for the common folk to be used as a school and medical center. An engineer constructed the building and in couple of years later he was transferred to a different location(as part of regular job rotation). Another engineer came to fill in his place and said that before he could take charge, he would like to see the building. When the two engineers went to building location, there was no trace of the building or it being ever constructed. The new engineer says that how can he take charge when there is no such building. The old engineer with glitter in his eyes says that he constructed the building, you just keep maintaining the building. The new engineer being old in the trade understood what it meant, signed the papers and took the official charge. He kept maintaining it for some years before he was also transferred to a new posting. A third engineer comes to replace him and in a similar fashion, contended that he will take charge only after inspecting the building. Both went to the building site and like last time, there was no trace of the building. The freshly arrived engineer accusing the existing in-charge for corruption, says that he will report this wrongdoing to his superiors that no such building was ever constructed and whole funds were misappropriated. The existing engineer with a whiff of confidence coolly places his hand on mildly angry new engineer and says that some previous engineer constructed the building, i was maintaining it and now if you want you can demolish it. There will be no need for inquiry and everything will be according to the rule of the land.
power corrupts...absolute power... corrupts absolutely
Pure Engineering!
This is what we call engineering at its best. The best minds out there describe the challenges that NASA's Curiosity rover is going to face in its last moments of descent on the Martian surface when it lands in the first week of August this year. Seriously that is some feat and yes, Best of luck for the landing!
Another One Bites The Dust
Sepia Mutiny is closing shop today after a very very long run (long in context of the web where most interesting things are transitory). It was among the few initial blogs that I started to read and follow. For the past few years though i had been less and less frequent to that blog (for that matter to any blog including mine). It is sign of the times. The discussion has moved over to Twitter and Facebook long time back. Whatever blog enthusiast were left have moved to busy married life and even more busier jobs. Blogs are seen as passé. Some are now just an extension of the huge corporate media arms where blogs are run like publications with paid writers and moderated content.
I am not convinced that Twitter/Facebook provide the canvas that blogs did. 140 words is not even enough to prepare the construct, leave aside the narrative. But then we are living in a post-post-post-modernism (if there is such a term) where the explosion of media (social and digital) has left user attention span difficult to capture. In such a crowded ecosystem, blogs do not stand a chance. They never did.
Lets see how long this blog breathes. I for sure will not let it go easy!
I am not convinced that Twitter/Facebook provide the canvas that blogs did. 140 words is not even enough to prepare the construct, leave aside the narrative. But then we are living in a post-post-post-modernism (if there is such a term) where the explosion of media (social and digital) has left user attention span difficult to capture. In such a crowded ecosystem, blogs do not stand a chance. They never did.
Lets see how long this blog breathes. I for sure will not let it go easy!
What's Next?
After Tunis, Cairo is the other capital that has fallen to people power frustrated over the lack of reforms, employment and long reigned monarchs that are aloof to the sufferings of the street. Of the 22 countries that constitute the Arab League, only 3 were democracies. The rest 19 (including Tunisia & Egypt) were ruled by despots and autocrats. So there are still 17 more color revolutions waiting to happen. Wonder if there are so many colors available :) The 3 members that are democratic are Lebanon, Iraq and Palestine Territories. Each of the three are still mired in no less existential crises at home. So democracy or no democracy, this region will never have a slow news day i guess. Anyways, hiccups in democratic setups in these countries is no excuse to authoritarian regimes that Arab world is so full of. Three Cheers to the people power and remember there are 17 more to go! Keep the ammo ready and dry!
Global Warming : The Feedback Loop
Among the lot of alternative careers that I wish for, one that would have ranked up high in the list would have been climate change researcher. I feel very strongly for this subject and I guess everyone should. We have this earth not for ourselves but for posterity. I had wanted to write this post for long, about the vicious cycle and the slow changes that work behind the global warming phenomenon. Everyone knows that carbon dioxide from human activity is causing an increase in greenhouses gases in atmosphere leading to global warming as global temperatures rise due to heat being trapped in the atmosphere. This post highlights little known facts about the global warming process to give you a bigger canvas of the momentous changes happening slowly as we live and as we sleep.
Fact 1 : If you see the amount of CO2 in the atmosphere over a year, the figures tend to vary dramatically due to the fact that northern hemisphere in winters does not absorb any CO2 leading to an increase of CO2 percentage in the atmosphere while the amount goes down in northern hemisphere summers. So the graph of CO2 amount over a year is zig-zag and not constant, but the trend is definitely upward over long term.
Fact 2 : The northern hemisphere warms more than southern because there is much larger land in north which heats more than sea. Besides there is more ice cover in north.This is causing the arctic circle ice shelf to melt dramatically while some sectors in antarctic ice-shelf are gaining ice, but the net-net is negative.
Fact 3 : The warming is forcing ice caps to melt and increasing the global temperature which increases the moisture content in the air causing a feedback loop since water vapour is a mild green house gas. So the more temperature causes more water vapour and hence more temperature and the cycle goes on.
Fact 4 : The increasing temperature will lead to decreasing ice caps and ice cover, which will cause less and less of sunlight to be reflected back and more to be absorbed by ground and water causing another feedback loop.The dark water and land absorbs more heat as compared to ice cover as ice reflects it back. So the more ice melts the more land/sea gets exposed and absorbs even more. Another tragic feedback loop.
Fact 5 : The increasing temperature in the polar and sub polar region will cause the permafrost to melt. Now this permafrost is frozen for probably millions of years and hold vast amount of organic matter. Once the temperate rises, this permafrost will thaw causing the organic matter to decay and releasing the vast amount to methane/CO2 trapped inside causing another feedback loop since methane is many times for greenhouse causing gas then CO2. More temperature means more permafrost melt and hence more greenhouses gases in air and consequently more temperature. Besides permafrost will melt and flow to the sea or lose its rigidity causing vast arctic and siberian plains to be uninhabitable,.
Fact 6 : Colder water absorbs more CO2 than warmer water. As the greenhouses gases increase, the sea temperature will also rises, causing the CO2 in the oceans to decrease and that gets released to the atmosphere. Another feedback loop that will cause an increase in temperature to contribute yet more increase.
Fact 7 : As temperature in Arctic increases, it is causing lakes and rivers over the ice cap and glaciers that barrel through the width of the ice cap and lubricate the surface between ground and ice above causing the whole ice mass to move to the sea. This fresh water flow goes down in crevasse and slowly melt the underlying foundation of the ice-cap making it more prone to flow towards the sea. As temperature rises, more of these lakes and rivers get formed that increases the water that is reaching the continental shelf.
These are just some of the various factors that go into the complex climate science and since these time scales are so large and effects so small and variables so many, it is still and evolving science that is difficult to fathom to many. People find it hard to believe the idea that just cars and factories can affect the whole climate of this vast planet. But the brutal truth is that what if the science is right, what if we really cause. We do not have a luxury of a second home. This Earth is all we have!
Fact 1 : If you see the amount of CO2 in the atmosphere over a year, the figures tend to vary dramatically due to the fact that northern hemisphere in winters does not absorb any CO2 leading to an increase of CO2 percentage in the atmosphere while the amount goes down in northern hemisphere summers. So the graph of CO2 amount over a year is zig-zag and not constant, but the trend is definitely upward over long term.
Fact 2 : The northern hemisphere warms more than southern because there is much larger land in north which heats more than sea. Besides there is more ice cover in north.This is causing the arctic circle ice shelf to melt dramatically while some sectors in antarctic ice-shelf are gaining ice, but the net-net is negative.
Fact 3 : The warming is forcing ice caps to melt and increasing the global temperature which increases the moisture content in the air causing a feedback loop since water vapour is a mild green house gas. So the more temperature causes more water vapour and hence more temperature and the cycle goes on.
Fact 4 : The increasing temperature will lead to decreasing ice caps and ice cover, which will cause less and less of sunlight to be reflected back and more to be absorbed by ground and water causing another feedback loop.The dark water and land absorbs more heat as compared to ice cover as ice reflects it back. So the more ice melts the more land/sea gets exposed and absorbs even more. Another tragic feedback loop.
Fact 5 : The increasing temperature in the polar and sub polar region will cause the permafrost to melt. Now this permafrost is frozen for probably millions of years and hold vast amount of organic matter. Once the temperate rises, this permafrost will thaw causing the organic matter to decay and releasing the vast amount to methane/CO2 trapped inside causing another feedback loop since methane is many times for greenhouse causing gas then CO2. More temperature means more permafrost melt and hence more greenhouses gases in air and consequently more temperature. Besides permafrost will melt and flow to the sea or lose its rigidity causing vast arctic and siberian plains to be uninhabitable,.
Fact 6 : Colder water absorbs more CO2 than warmer water. As the greenhouses gases increase, the sea temperature will also rises, causing the CO2 in the oceans to decrease and that gets released to the atmosphere. Another feedback loop that will cause an increase in temperature to contribute yet more increase.
Fact 7 : As temperature in Arctic increases, it is causing lakes and rivers over the ice cap and glaciers that barrel through the width of the ice cap and lubricate the surface between ground and ice above causing the whole ice mass to move to the sea. This fresh water flow goes down in crevasse and slowly melt the underlying foundation of the ice-cap making it more prone to flow towards the sea. As temperature rises, more of these lakes and rivers get formed that increases the water that is reaching the continental shelf.
These are just some of the various factors that go into the complex climate science and since these time scales are so large and effects so small and variables so many, it is still and evolving science that is difficult to fathom to many. People find it hard to believe the idea that just cars and factories can affect the whole climate of this vast planet. But the brutal truth is that what if the science is right, what if we really cause. We do not have a luxury of a second home. This Earth is all we have!
The Economy Thread Part II
Couple of weeks back we discussed briefly on some basic economic terms and the way the whole puzzle works out. Today we will discuss, the brief contours of the current monetary system (fiat money) and why it is what it is today. Before we get down to detail, there are couple (actually more) of terms that i would like to be clear about.
Fiat Money - is money that has its value because of government legislation. For e.g. Rupee as its value is because government has said (and guaranteed) that it is a legal tender for money.
Reserve Currency - is a currency that is held by various governments as part of their foreign exchange reserves and most commonly traded commodities (like gold, oil) are traded in it. Dollar for e.g. is a reserve currency. Oil/Gold are dollar denominated.
Fixed currency regime - where currency is pegged to a reserve currency and can trade within a parity. e.g Chinese Yuan
Managed Float regime - where currency is fluctuates daily but central banks intervene by selling & buying reserve currency. e.g. Indian Rupee
Free Float - where currency openly fluctuates in the foreign currency exchanges. e.g. Japanese Yen
The basis of current monetary system is a fiat money based and has a managed float currency (as is case with India) with the American dollar being the reserve currency. The world initially started with Gold Standard. In gold standard, the monetary unit was a fixed weight of gold. There were lot of variants of this standard, wherein either gold coins were circulated or where silver coins were circulated that had a fixed external value in terms of gold that is independent of the inherent silver value or where authorities have agreed to sell gold bullion on demand at a fixed price in exchange for the circulating currency. A full gold standard, exists when a monetary authority holds sufficient gold to convert all of the money it has issued into gold at the promised exchange rate. This is difficult to implement as the quantity of gold in the world is too small to sustain current worldwide economic activity at current gold prices.
These systems had some inherent problems, first being in bimetallism (a system establishes a fixed rate of exchange for the two metals) where if the market forces of supply and demand for either metal caused its bullion value to exceed its nominal currency value, it tends to disappear from circulation by hoarding or melting down. Besides in the beginning of 19th century due to the imperfections in the trade, silver which was being used to stuck coins began to get drained out of the industrialized world. Over those initial years variations in trade, deficits to fight wars and variations in supply of these metals caused governments to move back and forth between various types of gold standard and silver standard and sometimes entirely off the gold/silver standard. But it was the Great Depression of 1933 that put the final nail in the coffin of the standard. Due to gold backing, the central banks in those times were bound by how much money they could inject in the system by the gold reserves they had in their vault. This hampered their maneuverability to end the crisis. Besides the central had to defend the price of the dollar(by increasing interest rates), which caused deflation and led banks to redeem the gold backing causing further reduction in notes in circulation leading to more slowdown. By 1930's most of the world had abandoned gold standard and moved to fiat money. The basis the gold standard was convertibility.The international value of currency was determined by its fixed relationship to gold; gold was used to settle international accounts. The gold standard maintained fixed exchange rates that were seen as desirable because they reduced the risk of trading with other countries. Imbalances in international trade were theoretically rectified automatically by the gold standard. A country with a deficit would have depleted gold reserves and would thus have to reduce its money supply. The resulting fall in demand would reduce imports and the lowering of prices would boost exports; thus the deficit would be rectified. Any country experiencing inflation would lose gold and therefore would have a decrease in the amount of money available to spend. This decrease in the amount of money would act to reduce the inflationary pressure.
After the WWII, to empower trade between the devastated economies of the world, so that economies could recover it was decided that an international monetary standard would be established for free trade and exchange rate stability. This also ensured that devastated countries do not devalue arbitrarily just to rig exports and set of a chain of devaluation by competing nations. Since the only nation to emerge relatively stronger from WWII was US, it was decided that the value of the U.S. dollar would be fixed to $35 per ounce, and the value of the U.S. dollar was thus anchored to the value of gold. The US Government committed to convert dollars into gold at that price. Also decided in the Bretton Woods system was a system of fixed exchange rates. The rules further sought to encourage an open system by committing members to the convertibility of their respective currencies into other currencies and to free trade. This was also called as a peg currency regime. Nations were required to establish a parity of their national currencies in terms of the reserve currency and to maintain exchange rates by intervening in their foreign exchange markets. The U.S. dollar was the currency with the most purchasing power and it was the only currency that was backed by gold. The Bretton Woods regime also led to the establishment to World Bank & IMF. This regime led to huge transfers of gold to US, massive trade surpluses for US and an appreciated dollar. To reverse this dollar flow, US started the Marshall plan to distribute aid and grant to nations besides improving dollar liquidity.
By late 1950's the US balance of payment went negative, besides for $35 an ounce convertibility to work, the peg has to be maintained in the open gold market as well to avoid nations from buying gold from US and selling it in open market for profit. Rising US government spending in the 1960s, however, led to doubts about the ability of the US to maintain this convertibility, gold stocks dwindled as banks and international investors began to convert dollars to gold, and as a result the value of the dollar began to decline. Facing an emerging currency crisis and the imminent danger that the US would no longer be able to redeem dollars for gold, gold convertibility was finally terminated in 1971. The gold backing requirements for the US dollar were also repealed. This marked the end of the international gold standard and the fixed currency regime. Within five years, most of the nations moved to a floating currency regime.
One question that maybe in readers mind is since all currencies today are fiat money, what is stopping central bank from printing money and handing everyone 1000 Rupee notes. Yes it is true that there are no gold backing requirements that bars central bank from printing endless money, but increasing money supply will lead to inflation and hyperinflation.
The next part of this series would be on 2008 financial crisis.
Fiat Money - is money that has its value because of government legislation. For e.g. Rupee as its value is because government has said (and guaranteed) that it is a legal tender for money.
Reserve Currency - is a currency that is held by various governments as part of their foreign exchange reserves and most commonly traded commodities (like gold, oil) are traded in it. Dollar for e.g. is a reserve currency. Oil/Gold are dollar denominated.
Fixed currency regime - where currency is pegged to a reserve currency and can trade within a parity. e.g Chinese Yuan
Managed Float regime - where currency is fluctuates daily but central banks intervene by selling & buying reserve currency. e.g. Indian Rupee
Free Float - where currency openly fluctuates in the foreign currency exchanges. e.g. Japanese Yen
The basis of current monetary system is a fiat money based and has a managed float currency (as is case with India) with the American dollar being the reserve currency. The world initially started with Gold Standard. In gold standard, the monetary unit was a fixed weight of gold. There were lot of variants of this standard, wherein either gold coins were circulated or where silver coins were circulated that had a fixed external value in terms of gold that is independent of the inherent silver value or where authorities have agreed to sell gold bullion on demand at a fixed price in exchange for the circulating currency. A full gold standard, exists when a monetary authority holds sufficient gold to convert all of the money it has issued into gold at the promised exchange rate. This is difficult to implement as the quantity of gold in the world is too small to sustain current worldwide economic activity at current gold prices.
These systems had some inherent problems, first being in bimetallism (a system establishes a fixed rate of exchange for the two metals) where if the market forces of supply and demand for either metal caused its bullion value to exceed its nominal currency value, it tends to disappear from circulation by hoarding or melting down. Besides in the beginning of 19th century due to the imperfections in the trade, silver which was being used to stuck coins began to get drained out of the industrialized world. Over those initial years variations in trade, deficits to fight wars and variations in supply of these metals caused governments to move back and forth between various types of gold standard and silver standard and sometimes entirely off the gold/silver standard. But it was the Great Depression of 1933 that put the final nail in the coffin of the standard. Due to gold backing, the central banks in those times were bound by how much money they could inject in the system by the gold reserves they had in their vault. This hampered their maneuverability to end the crisis. Besides the central had to defend the price of the dollar(by increasing interest rates), which caused deflation and led banks to redeem the gold backing causing further reduction in notes in circulation leading to more slowdown. By 1930's most of the world had abandoned gold standard and moved to fiat money. The basis the gold standard was convertibility.The international value of currency was determined by its fixed relationship to gold; gold was used to settle international accounts. The gold standard maintained fixed exchange rates that were seen as desirable because they reduced the risk of trading with other countries. Imbalances in international trade were theoretically rectified automatically by the gold standard. A country with a deficit would have depleted gold reserves and would thus have to reduce its money supply. The resulting fall in demand would reduce imports and the lowering of prices would boost exports; thus the deficit would be rectified. Any country experiencing inflation would lose gold and therefore would have a decrease in the amount of money available to spend. This decrease in the amount of money would act to reduce the inflationary pressure.
After the WWII, to empower trade between the devastated economies of the world, so that economies could recover it was decided that an international monetary standard would be established for free trade and exchange rate stability. This also ensured that devastated countries do not devalue arbitrarily just to rig exports and set of a chain of devaluation by competing nations. Since the only nation to emerge relatively stronger from WWII was US, it was decided that the value of the U.S. dollar would be fixed to $35 per ounce, and the value of the U.S. dollar was thus anchored to the value of gold. The US Government committed to convert dollars into gold at that price. Also decided in the Bretton Woods system was a system of fixed exchange rates. The rules further sought to encourage an open system by committing members to the convertibility of their respective currencies into other currencies and to free trade. This was also called as a peg currency regime. Nations were required to establish a parity of their national currencies in terms of the reserve currency and to maintain exchange rates by intervening in their foreign exchange markets. The U.S. dollar was the currency with the most purchasing power and it was the only currency that was backed by gold. The Bretton Woods regime also led to the establishment to World Bank & IMF. This regime led to huge transfers of gold to US, massive trade surpluses for US and an appreciated dollar. To reverse this dollar flow, US started the Marshall plan to distribute aid and grant to nations besides improving dollar liquidity.
By late 1950's the US balance of payment went negative, besides for $35 an ounce convertibility to work, the peg has to be maintained in the open gold market as well to avoid nations from buying gold from US and selling it in open market for profit. Rising US government spending in the 1960s, however, led to doubts about the ability of the US to maintain this convertibility, gold stocks dwindled as banks and international investors began to convert dollars to gold, and as a result the value of the dollar began to decline. Facing an emerging currency crisis and the imminent danger that the US would no longer be able to redeem dollars for gold, gold convertibility was finally terminated in 1971. The gold backing requirements for the US dollar were also repealed. This marked the end of the international gold standard and the fixed currency regime. Within five years, most of the nations moved to a floating currency regime.
One question that maybe in readers mind is since all currencies today are fiat money, what is stopping central bank from printing money and handing everyone 1000 Rupee notes. Yes it is true that there are no gold backing requirements that bars central bank from printing endless money, but increasing money supply will lead to inflation and hyperinflation.
The next part of this series would be on 2008 financial crisis.
The Resonableness Deficient
Reasoning is something that is really in short currency these days. Common sense and logical thought is being replaced by hysteria and arm-twisting. Couple of stories that have been playing over and over again in the media shows how the debate is polarizing the societies (in two vastly different countries) leaving the people in the middle squeezed and with no room for rapprochement.
Firstly, the gruesome murder of Pakistani Punjab's Governor. His being killed is not important now. What is of merit is the causes and the after response. The causes as flimsy as they may be shows the (Pakistani) society in general is losing grip with debate and reason, where loud talk gets the better of reasonable talk. Where external conspiracy theory is believed rather then looking at faults inside. Where tolerance is being replaced by mindless bigotry. And where the killer is being showered rose petals by the lawyers who must uphold justice and law of the land. Where the so called educated and facebook generation is opening approving the actions of the killer and the political class is condoning it. The debate over blasphemy has been needlessly played out in the media as if this is the only issue confronting the nation. Any talk of reason is shouted down as being anti-religious and atheist.
Secondly, the fatal shooting in Tucson which has dominated the American media and consciousness. Here the shooting unlike in Pakistan has united the nation in grief. No one is condoning the psychotic shooter's action. But the vast swath of the nation and its political class is an accessory to murder by not limiting access to guns. The whole debate over guns is something that is beyond my logic and reason. Any talk of gun control is met with such derision as if people have been asked to surrender there right to speech or privacy. In fact, it is easier to pass legislation to pry on people's phone than to control society's access to such high powered guns. Why does anyone need a pistol that can shoot 31 rounds without reload? Can any reasonable person answer this. Why would anyone need an AR-15 military assault rifle? Why? Why is there such a fear of government trampling over citizens rights? Aren't innocent law-abiding citizens rights being trampled by senseless killing in schools, churches and malls because some psychotic had access to such high powered gun due to lack of control and verification? Why such concern for people having access to these guns but none for over thousands killed in gun related violence. Here again the debate has not been over logic and reason but instead has been hijacked by rhetoric and name-calling by the 24 hour news media (as is the case in both countries).
In both the case we are not even going into the causes for these tragic events, and in any case there can be no justification for violence however 'aggrieved' the killer is. The real issues in my view is why is it so hard to talk and reason on issues where course of action is clear and logical without being branded Nazis or atheist. Back home, the lesser said the better. We are maybe getting more developed (economically), but in reality our brains are shriveling in same proportion. Last week a person died in Delhi unforgiving roads due to a (now common) case of road rage. This short fuse, this me.. my car.. my road craziness is insane. People are getting killed because nobody wants to reason, or even stop for a moment to ponder. There is no scope for middle ground. It is either my way or the highway.
Firstly, the gruesome murder of Pakistani Punjab's Governor. His being killed is not important now. What is of merit is the causes and the after response. The causes as flimsy as they may be shows the (Pakistani) society in general is losing grip with debate and reason, where loud talk gets the better of reasonable talk. Where external conspiracy theory is believed rather then looking at faults inside. Where tolerance is being replaced by mindless bigotry. And where the killer is being showered rose petals by the lawyers who must uphold justice and law of the land. Where the so called educated and facebook generation is opening approving the actions of the killer and the political class is condoning it. The debate over blasphemy has been needlessly played out in the media as if this is the only issue confronting the nation. Any talk of reason is shouted down as being anti-religious and atheist.
Secondly, the fatal shooting in Tucson which has dominated the American media and consciousness. Here the shooting unlike in Pakistan has united the nation in grief. No one is condoning the psychotic shooter's action. But the vast swath of the nation and its political class is an accessory to murder by not limiting access to guns. The whole debate over guns is something that is beyond my logic and reason. Any talk of gun control is met with such derision as if people have been asked to surrender there right to speech or privacy. In fact, it is easier to pass legislation to pry on people's phone than to control society's access to such high powered guns. Why does anyone need a pistol that can shoot 31 rounds without reload? Can any reasonable person answer this. Why would anyone need an AR-15 military assault rifle? Why? Why is there such a fear of government trampling over citizens rights? Aren't innocent law-abiding citizens rights being trampled by senseless killing in schools, churches and malls because some psychotic had access to such high powered gun due to lack of control and verification? Why such concern for people having access to these guns but none for over thousands killed in gun related violence. Here again the debate has not been over logic and reason but instead has been hijacked by rhetoric and name-calling by the 24 hour news media (as is the case in both countries).
In both the case we are not even going into the causes for these tragic events, and in any case there can be no justification for violence however 'aggrieved' the killer is. The real issues in my view is why is it so hard to talk and reason on issues where course of action is clear and logical without being branded Nazis or atheist. Back home, the lesser said the better. We are maybe getting more developed (economically), but in reality our brains are shriveling in same proportion. Last week a person died in Delhi unforgiving roads due to a (now common) case of road rage. This short fuse, this me.. my car.. my road craziness is insane. People are getting killed because nobody wants to reason, or even stop for a moment to ponder. There is no scope for middle ground. It is either my way or the highway.
What Tunisia Portends
Last week was one of the rare weeks of change in the middle east or lets say the broader Arab world. After being in power for better part of 25 years, the president of this small Mediterranean country was forced to flee the country. Let me just give you facts as to why this is important. The whole Arab world from Morocco to Iran (Iran & Turkey and not exactly Arab, but we are still branding them for region's entirety.) is filled with despots, monarch and president-for-life types rulers. This is one place where democracy has still to find its feet. Maybe this could be the trigger for broader change. The rulers of Egypt, Algeria and others need to be worried that their local alienated population does not take cues from events unfolding in Tunisia. The problems with this region are unique, especially in the sense that the region as such is not poor. Tunisia has oil wealth as well as tourism, but given the rapid population growth rates that Arab countries are experiencing, jobs are not being created to absorb them. So alienation and frustration is spilling on to streets and since there are no checks & balances in the political system, no safety valves.. it boils over. This problem is same as what is staring in the face of Egypt, Morocco and countless others. Add to this mix, the rising militant Islam, the growth of conservative Muslim influence, Al Queda lurking in the shadows in the vast Sahara and extreme distribution of oil wealth, these events have the power to reshape the entire Arab landscape. Time will tell if a small vegetable vendor's death was the harbinger of change sweeping the vast desert expanse. Time will tell!
The Economy Thread Part 1
I have been thinking of writing this one for a long long time, and yet i have not got it complete yet. This topic is one of the countless that fascinate me, the science behind the economy and factors that influence it. This is the first post in a series on Economy. It is arranged in terms for simple Q and A for easier understanding!
How can the central bank cool the economy?
It does by increasing the bank rate and the CRR rate primarily. Bank rate(discount rate) is the rate of interest at which central bank gives loans to banks. This is used to change the money supply. CRR on the other hand is the minimum reserves that each bank needs to park with the central bank. This is an important instrument in money supply. What is money supply? Suppose bank has Rs. 100 and it lends Rs. 90 as loan(10% being the CRR). The total max money supply is Rs. 1000 (How? - if bank has Rs 100, it loans you Rs 90, you deposit the Rs 90 back in bank, then bank again loans out 90% of it i.e. Rs 81 and this goes on. The total amount would be Rs 1000 like this). If central bank feels that money supply is too much it can raise CRR to 20% and the max money supply now would come down to 100+80+64.. to 500. Hence this reduces money creation and maintains purchasing power. But how can money supply maintain purchasing power??
Suppose there are 100 rupees chasing 10 items in the market, and the increased money supply leads to 110 rupees in the same market for those original 10 products. In short, there are Rs. 11 to buy the same item. Now, the prices will rise. This is a very simple analogy of a complex science, but that is pretty much the way it works.
What about interest rate? Does not that matter? Yes it matters. Lower interest rate means that borrowing is easier for individuals to buy stuff like cars, houses and for companies so they create new capacities and increase employment. The increased spending by individuals also in-turn boosts the economy as it produces demand for goods. On the other hand a runaway growth leads to hardening of interest rates as most of the money is being spent on consumption or creating new capacity leading to bank deposits running low, thereby curbing new loans. In those cases banks increase deposit rates and loan rates to induce people to save and make it harder for companies to borrow. Runaway growth also leads to inflation as wages rise causes more money to chase fewer items in the market, besides the increased money supply in the system is also a factor in increased inflation as there is a higher demand for credit.
How can the central bank induce growth in the economy?
To induce economy, the easiest is to lower the rate of interest so that it is easier to burrow and increase consumption. Also lower the CRR, so that money supply in the system increases that causes more money at bank's disposal.The other form of stimulus is increased government spending like government agreeing to make 8-lane all 4-lane highways in the country. The spin-off of such spending is increased jobs and consumption of goods therefore kick starting the economy. But it has a trade-off, since this government spending is financed by borrowing, this increases debt causing interest rate to rise as borrowing created a higher demand for credit. since most money is put on government debt, less money on consumption so this may negate the effects of the stimulus.
Another way to induce growth is to qualitative easing (which is done when interest rates are near zero, so there is not much scope to reduce rates.) In this the central bank prints money and buys back the government bonds previously issued to the bank so that money supply is increased in the system and this excess liquidity is used to loan money to individuals and companies to induce growth.
What is T-bills?
The US has a huge budget deficit, so it has more dollars going out, then coming in. It manages this by issuing out T-bills or bonds or notes. All these instruments are different, and have varying yields and maturity time. This is government debt. Why does countries like China buy them? Because it a an ultra-safe investment for there trade surplus dollars besides it buys a certain influence in Washington. What if China one day decides to sell it T-instruments one day. Probably the sky will not fall, as there are other buyers in the market who will chip in.
Why US/Japan is not failing despite this much debt?
The reason US is not going to go under despite the massive deficit, is due to the fact that its currency, the dollar is the world's reserve currency and most of the trade in gold, oil is dollar denominated. In short the buyers for dollar are always there. As for Japan, since about 95 percent of Japan’s debt is held domestically, there’s no risk of capital flight. Japan borrows from its companies and people, an arrangement that’s roughly the mirror image of the U.S.
Next week on stagflation, credit swaps, foreign exchange and bonds.
How can the central bank cool the economy?
It does by increasing the bank rate and the CRR rate primarily. Bank rate(discount rate) is the rate of interest at which central bank gives loans to banks. This is used to change the money supply. CRR on the other hand is the minimum reserves that each bank needs to park with the central bank. This is an important instrument in money supply. What is money supply? Suppose bank has Rs. 100 and it lends Rs. 90 as loan(10% being the CRR). The total max money supply is Rs. 1000 (How? - if bank has Rs 100, it loans you Rs 90, you deposit the Rs 90 back in bank, then bank again loans out 90% of it i.e. Rs 81 and this goes on. The total amount would be Rs 1000 like this). If central bank feels that money supply is too much it can raise CRR to 20% and the max money supply now would come down to 100+80+64.. to 500. Hence this reduces money creation and maintains purchasing power. But how can money supply maintain purchasing power??
Suppose there are 100 rupees chasing 10 items in the market, and the increased money supply leads to 110 rupees in the same market for those original 10 products. In short, there are Rs. 11 to buy the same item. Now, the prices will rise. This is a very simple analogy of a complex science, but that is pretty much the way it works.
What about interest rate? Does not that matter? Yes it matters. Lower interest rate means that borrowing is easier for individuals to buy stuff like cars, houses and for companies so they create new capacities and increase employment. The increased spending by individuals also in-turn boosts the economy as it produces demand for goods. On the other hand a runaway growth leads to hardening of interest rates as most of the money is being spent on consumption or creating new capacity leading to bank deposits running low, thereby curbing new loans. In those cases banks increase deposit rates and loan rates to induce people to save and make it harder for companies to borrow. Runaway growth also leads to inflation as wages rise causes more money to chase fewer items in the market, besides the increased money supply in the system is also a factor in increased inflation as there is a higher demand for credit.
How can the central bank induce growth in the economy?
To induce economy, the easiest is to lower the rate of interest so that it is easier to burrow and increase consumption. Also lower the CRR, so that money supply in the system increases that causes more money at bank's disposal.The other form of stimulus is increased government spending like government agreeing to make 8-lane all 4-lane highways in the country. The spin-off of such spending is increased jobs and consumption of goods therefore kick starting the economy. But it has a trade-off, since this government spending is financed by borrowing, this increases debt causing interest rate to rise as borrowing created a higher demand for credit. since most money is put on government debt, less money on consumption so this may negate the effects of the stimulus.
Another way to induce growth is to qualitative easing (which is done when interest rates are near zero, so there is not much scope to reduce rates.) In this the central bank prints money and buys back the government bonds previously issued to the bank so that money supply is increased in the system and this excess liquidity is used to loan money to individuals and companies to induce growth.
What is T-bills?
The US has a huge budget deficit, so it has more dollars going out, then coming in. It manages this by issuing out T-bills or bonds or notes. All these instruments are different, and have varying yields and maturity time. This is government debt. Why does countries like China buy them? Because it a an ultra-safe investment for there trade surplus dollars besides it buys a certain influence in Washington. What if China one day decides to sell it T-instruments one day. Probably the sky will not fall, as there are other buyers in the market who will chip in.
Why US/Japan is not failing despite this much debt?
The reason US is not going to go under despite the massive deficit, is due to the fact that its currency, the dollar is the world's reserve currency and most of the trade in gold, oil is dollar denominated. In short the buyers for dollar are always there. As for Japan, since about 95 percent of Japan’s debt is held domestically, there’s no risk of capital flight. Japan borrows from its companies and people, an arrangement that’s roughly the mirror image of the U.S.
Next week on stagflation, credit swaps, foreign exchange and bonds.
1984 v/s Brave New World
I am these days reading Huxley's "Brave New World", I found that there are unmistakable similarities with Orwell's 1984, in the sense of stark and futuristic London, where there is an all powerful and all knowing authority and everyone else is just a empty face walking down the street or working in the offices. But yet the two books are so so different in the way they showcase this alienation.. while 1984 had all its frugality, the Brave New World instead was full of unbridled excesses.. while 1984 was about rewriting the truth.. in Brave New World there was no truth, it's all make belief. in 1984 it is oppression that makes people forgo rights, in other it is pleasure that makes them do it. in 1984 there is an all engrossing pessimism, the other has a overwhelming consumerist nihilism.
This is from Wikipedia about the differences between these two seminal work of dystopian literature.
[...]
What Orwell feared were those who would ban books. What Huxley feared was that there would be no reason to ban a book, for there would be no one who wanted to read one. Orwell feared those who would deprive us of information. Huxley feared those who would give us so much that we would be reduced to passivity and egoism. Orwell feared that the truth would be concealed from us. Huxley feared the truth would be drowned in a sea of irrelevance. Orwell feared we would become a captive culture. Huxley feared we would become a trivial culture. In 1984, people are controlled by inflicting pain.In Brave New World, they are controlled by inflicting pleasure. In short, Orwell feared that what we fear will ruin us. Huxley feared that what we desire will ruin us.
[...]
Just so that you know, 1984 is my favorite book.
This is from Wikipedia about the differences between these two seminal work of dystopian literature.
[...]
What Orwell feared were those who would ban books. What Huxley feared was that there would be no reason to ban a book, for there would be no one who wanted to read one. Orwell feared those who would deprive us of information. Huxley feared those who would give us so much that we would be reduced to passivity and egoism. Orwell feared that the truth would be concealed from us. Huxley feared the truth would be drowned in a sea of irrelevance. Orwell feared we would become a captive culture. Huxley feared we would become a trivial culture. In 1984, people are controlled by inflicting pain.In Brave New World, they are controlled by inflicting pleasure. In short, Orwell feared that what we fear will ruin us. Huxley feared that what we desire will ruin us.
[...]
Just so that you know, 1984 is my favorite book.
Alan Moore : The Watchmen (Summary)
I have been reading the comic novel "The Watchmen" after watching the movie, which for all practical purposes I found to be an utter waste of time. The novel on the other hand has been quite a revelation not only with its storyline and the novelty of the idea but also the context. And the context here defines the story. It is seventies and tension is high between US and Soviet Union and both on trigger alert for nuclear weapon. In this all engrossing pessimism, the book captures the story of costumed super heroes out there to save the world, but in the end they manage to save the peace, only to lose themselves in the utter grotesque of violence and madness and insanity. The mood is set in New York, with all its malice of the congested city life where no one looks out for one another and crime. These heroes, fighting to save the city from crime, but themselves are a disoriented bunch. Never before, have we seen super heroes fail, or go mad or become a hired mercenary, but this novel captures the baser instincts of lust, of power and propensity for violence and makes a case against vigilantism. Also remarkable is the imagery and the subtle meaning of symbols that have been used multiple times, like the doomsday clock. Also the storyline is non-linear and jumps to different space, time, context and even stories. In the end, the heroes lose without having to fight the villains as there were none, the context and their inner dreads being their enemy.
Interwoven with the main story, is another totally different and gory tale about a pirate ship and and a survivor who in his lust for revenge, is blinded by the all consuming hate. Nietzsche was right with his observation "He who fights with monsters should be careful least he thereby becomes a monster. When you stare at the abyss, the abyss stares back at you." - One who starts knowing things about matters that are very different from what he is, he takes back a piece of it with himself and that piece changes him. so goddamn true.
Just so that know, "The Watchmen" is the the only comic novel that is included in the Time.com list of 100 best novels of 20th century.
Interwoven with the main story, is another totally different and gory tale about a pirate ship and and a survivor who in his lust for revenge, is blinded by the all consuming hate. Nietzsche was right with his observation "He who fights with monsters should be careful least he thereby becomes a monster. When you stare at the abyss, the abyss stares back at you." - One who starts knowing things about matters that are very different from what he is, he takes back a piece of it with himself and that piece changes him. so goddamn true.
Just so that know, "The Watchmen" is the the only comic novel that is included in the Time.com list of 100 best novels of 20th century.
The Seventh Month Roundup
This is the first post in seven months, I never meant to take this big a break from blogger ever, but then can you plan everything? any ways, for now the blog is alive. Since the last write-up in sometime October, there has been some pretty dramatic events that have happened that I used to blog about regularly. More detailed insights will be coming in the later posts that delve into them in detail.
- first, is the spectacular and the gigantic unwinding of the massive securities leveraging that has been built over the years in derivatives market. The net result has been that world financial markets has become one big vacuum that was sucking all real money to cover up losses in betting on notional money markets causing the money supply to dry and lead the world into recession. The visible result is that American corporate landscape has changed, and changed for ever. post-Detroit, post-Big Banks, the shine is off of corporate America.
- second, is the increasing grip of Taliban that is gnawing at the periphery in the neighbouring Pakistan. Add to this the 29-11 outrage, I think the day of reckoning has come for Islamabad. If you have lost control of places within 100 miles of capital (Swat, Buner), then I don't know what else is Pakistani military leadership is waiting for. I mean, can it go more dire, it does not take 100% support to conquer 100% of country. Only 10% can intimidate the rest 90% in submission. Indian Kashmir seems to be pretty much next on the cross hairs.
- thirdly, the Indian election, for not what was elected, but for what was rejected. regionalism is out, so is caste driven, religion driven politics. This election will be the first after 1989-mandal infused environs, where caste based politics was put on the back burner and development has been brought to fore. Equally inspiring is the revival of national parties and break from regionalism. Also the lack of communists can make sure that economic reforms can move forward especially in banking, pension and labour markets.
- lastly, the US election, that brought President Obama to the White House, what matters is not the party, but the style of functioning that he bring to office. The world needs some serious leadership in areas like renewable energy, financial regulation, curbing protectionism barriers, stem cell research, global warming and rising tide of militant Islam. I hope this president brings new approaches to these intricate issues, as we are already starting eight years late.
- first, is the spectacular and the gigantic unwinding of the massive securities leveraging that has been built over the years in derivatives market. The net result has been that world financial markets has become one big vacuum that was sucking all real money to cover up losses in betting on notional money markets causing the money supply to dry and lead the world into recession. The visible result is that American corporate landscape has changed, and changed for ever. post-Detroit, post-Big Banks, the shine is off of corporate America.
- second, is the increasing grip of Taliban that is gnawing at the periphery in the neighbouring Pakistan. Add to this the 29-11 outrage, I think the day of reckoning has come for Islamabad. If you have lost control of places within 100 miles of capital (Swat, Buner), then I don't know what else is Pakistani military leadership is waiting for. I mean, can it go more dire, it does not take 100% support to conquer 100% of country. Only 10% can intimidate the rest 90% in submission. Indian Kashmir seems to be pretty much next on the cross hairs.
- thirdly, the Indian election, for not what was elected, but for what was rejected. regionalism is out, so is caste driven, religion driven politics. This election will be the first after 1989-mandal infused environs, where caste based politics was put on the back burner and development has been brought to fore. Equally inspiring is the revival of national parties and break from regionalism. Also the lack of communists can make sure that economic reforms can move forward especially in banking, pension and labour markets.
- lastly, the US election, that brought President Obama to the White House, what matters is not the party, but the style of functioning that he bring to office. The world needs some serious leadership in areas like renewable energy, financial regulation, curbing protectionism barriers, stem cell research, global warming and rising tide of militant Islam. I hope this president brings new approaches to these intricate issues, as we are already starting eight years late.
Some Mumbling.. Some Rambling
The July is here, so soon I mean. it was February that I moved here & already six months are down now. The years seem to pass by so quick that some day not far in time, I may be sitting wondering if I have lived all these long years or did I pass them in sleep, seriously time seems to be flying past these days. Watched Hitchcock 'notorious' today, kept his 'the birds' for tomorrow. In other stuff today, deleted my Facebook account and opened a twitter account, I found twitter more useful then Facebook or say Orkut, but then both are catering to different markets. personal preference though.
The appraisals are going to be out next week I suppose, something to watch out for, lets see how bad the hike is. but it is definitely going to be below the rate of inflation & believe me that government's inflation rate is itself depressed( intentionally or unintentionally ). Indian economy has it going good for last 4-5 years & a couple of rainy days shouldn't be a problem at least for the nouveau riches.. poor be damned, who cares.. the government seems to have solved the nuclear tangle at last, and its good to see at least some amount of spine in the leadership, though I am not optimistic that this government would go much far, but anyway something is better than nothing.
Meanwhile July 4 passed & oil has not touched $150 as Jim Cramer was shouting on mad money, but it doesn't matter, 146 is as good as 150. 150 is just symbolic, the pain at pump started long way back. Somehow I feel Americans don't get it, wonder how can a (supposed !) intelligent country is being fooled not only oil producing countries, but by government and there own emotions. Where do you get a precious commodity for 2 bucks a gallon, a commodity that takes millions of years to create and a commodity that can drive say 4 people in a nice car for 180 miles, why the hell you should get that thing for 2 bucks, when even the water costs more. The supply is not a problem, the demand IS.
Commodity inflation is the big topic these days, and if you listen American media, this often hackneyed word about increased demand from India-China is now becoming a deluge now. take oil, India-China. take wheat, India-China. take anything, India-China. I wonder if India-China really increased there demand so much that the world's factories and farms and oil rigs have failed to keep pace. I just feel that it was okay as long as India-China were producing for the rest of the world, but as soon as we become consuming nations, the rest of the world started feeling the pinch. Take a often quoted sector refinery, which America has not built one for last 30 years. Why? because they don't want to have pollution in their backyard, so guess what, they have other countries make them & send the finished product to US. This is hypocrisy big time. I guess US in sometime future will claim that it has curtailed its carbon emission. And how, it will send all the polluting industries to cheaper nations and import finished products, so no emissions you see. This is all a façade to not change, to save 'their way of life'. (not sure what it means)
The appraisals are going to be out next week I suppose, something to watch out for, lets see how bad the hike is. but it is definitely going to be below the rate of inflation & believe me that government's inflation rate is itself depressed( intentionally or unintentionally ). Indian economy has it going good for last 4-5 years & a couple of rainy days shouldn't be a problem at least for the nouveau riches.. poor be damned, who cares.. the government seems to have solved the nuclear tangle at last, and its good to see at least some amount of spine in the leadership, though I am not optimistic that this government would go much far, but anyway something is better than nothing.
Meanwhile July 4 passed & oil has not touched $150 as Jim Cramer was shouting on mad money, but it doesn't matter, 146 is as good as 150. 150 is just symbolic, the pain at pump started long way back. Somehow I feel Americans don't get it, wonder how can a (supposed !) intelligent country is being fooled not only oil producing countries, but by government and there own emotions. Where do you get a precious commodity for 2 bucks a gallon, a commodity that takes millions of years to create and a commodity that can drive say 4 people in a nice car for 180 miles, why the hell you should get that thing for 2 bucks, when even the water costs more. The supply is not a problem, the demand IS.
Commodity inflation is the big topic these days, and if you listen American media, this often hackneyed word about increased demand from India-China is now becoming a deluge now. take oil, India-China. take wheat, India-China. take anything, India-China. I wonder if India-China really increased there demand so much that the world's factories and farms and oil rigs have failed to keep pace. I just feel that it was okay as long as India-China were producing for the rest of the world, but as soon as we become consuming nations, the rest of the world started feeling the pinch. Take a often quoted sector refinery, which America has not built one for last 30 years. Why? because they don't want to have pollution in their backyard, so guess what, they have other countries make them & send the finished product to US. This is hypocrisy big time. I guess US in sometime future will claim that it has curtailed its carbon emission. And how, it will send all the polluting industries to cheaper nations and import finished products, so no emissions you see. This is all a façade to not change, to save 'their way of life'. (not sure what it means)
Swiss Army Knife Syndrome
What does one want? The versatility of the Swiss army knife or the utility of the mundane kitchen knife. The Swiss army knife with its plethora of tools is helpful in cutting across most tight corners that one may find oneself in, but when at ease, when in the luxury of you home, you really don't want to be using it to do all your cutting with it. This is a quintessential choice I am facing, whether to stick to one set of technologies or be what I had been till day, jack of all trades, ace of none !. I used to like being a multi-headed hydra, but I guess its easier being a simple knife then the fancy-ism of the Swiss army knife.
Two Months Update
This has to go down as my biggest break from blogger since starting out last year. My last months in Boston were pretty hectic by my standards so blog was something that was not very high on my list of priorities. And it has been twenty days back in India & I am still to settle down to the sober surrounding and the not-so-sober Me. I am still to get used to wired internet & that all pervading overhang of that great smog over Noida. Life as such, is going real easy these days, or may be I have made it appear very easy, though there is always that undercurrent of anxiety, that loss of control, that elusive satisfaction, but I guess it doesn't matter right now for I will not scratch the surface harder to reveal the real Self. Yeah, went to Dehra Dun for diwali, also to Pune for a family ceremony, a pretty decent affair though, made decent money on stocks after a long time & the liquor parties seem to never end even though the circle of friends gets smaller every quarter. I guess I have started liking an uneventful life, even in Boston I had developed a liking for living alone, though initially I used to dread getting bored to death especially in foreign lands. This year long visit has kind of reshaped my outward perspective totally. I am becoming more & more individualistic & maybe a tinge of egoistic sprinkled in, to the extent that people seems to be hinting that I am arrogant now. But you know what, I don't really care. At the end of the day at work there is only one thing that matters - Was the work done or not ? All the rest of talk about 'your way' or 'my way' is crap that would be unbundled the next day. People have made a life out of giving advise which nobody really wants. People with three months in project commenting about people who have spent better part of three years here and not looking at their bag-full or maybe train-full of failures. I hate these phonies, I really do. But one thing is good, even with all these jokers around its fun working out here, all this argument and counter-argument just makes you really thick skinned, indifferent. The next time you just shrug them off, and maybe sometime later even the phonies would stop arguing, for even the God is scared of shameless.
Its been over a month since I deleted my Orkut account, and the fun part is the addiction seemed to have gone away pretty easily. maybe it wasn't an addiction, maybe Orkut become the evil & not so innocent victim of my holy pursuit to set all wrongs right within me, and as it was the easiest of the targets that I could have banished. but I don't regret it, its one addiction less. It was a great time killer, especially when you are bored & looking for easy & short fun, but it was far from real. Instead it was a giant unreal that covered the whole real, so that whatever you wrote & whatever you showed wasn't exactly from the top of you mind. It was many times written in ways that was meant to sound different from the actual reality. The picture album has the best of pictures, the smartest ones. The 'about me' is either a crisp paragraph of hackneyed lines or is some high flowing stuff that not anyway related to 'me' but some sterile dream. I am happy to shed of my other skin. These days for most of the questions I have only two answers, I don't know & I don't care. I wonder where I am going, am I getting into abyss where the walls have been built so high up in the sky that even when I look up, the sky seems dark. Maybe I should join the second life. Okay, I am joining second life.
Once this Orkut craze was over, I have now got into another addiction & this time it is on-line movies. but anyways not complaining yet. The reason being the project is in kind of unravelling state and so I have figured out that it's no use working hard or maybe I guess even working. The result is crystal clear, we ain't going to survive the next cutback the client proposes. So chill out & have a good time, for the show must go on. You know, whenever I say that line I recollect a poem that we had in our early school days which had the lines 'For men may come and men may go, But I go on for ever.'' Its funny for I recollect only one another poem, Robert Frost 'Woods Poem' & that too because every time I come from home in Dehra Dun, the thick dense jungle just reminds me of the last two lines, where the poet marvels at the dense forest & wishes for a path less travelled. Its strange how some memories are there in you mind embedded for ages & there are some I won't say memories, but reaction which are difficult to fathom. say for, whenever I hear Beatles's 'And I Love Her' I feel some strange melancholy but this sadness has no face & has no reason. Maybe I shouldn't hear that song.
Its been over a month since I deleted my Orkut account, and the fun part is the addiction seemed to have gone away pretty easily. maybe it wasn't an addiction, maybe Orkut become the evil & not so innocent victim of my holy pursuit to set all wrongs right within me, and as it was the easiest of the targets that I could have banished. but I don't regret it, its one addiction less. It was a great time killer, especially when you are bored & looking for easy & short fun, but it was far from real. Instead it was a giant unreal that covered the whole real, so that whatever you wrote & whatever you showed wasn't exactly from the top of you mind. It was many times written in ways that was meant to sound different from the actual reality. The picture album has the best of pictures, the smartest ones. The 'about me' is either a crisp paragraph of hackneyed lines or is some high flowing stuff that not anyway related to 'me' but some sterile dream. I am happy to shed of my other skin. These days for most of the questions I have only two answers, I don't know & I don't care. I wonder where I am going, am I getting into abyss where the walls have been built so high up in the sky that even when I look up, the sky seems dark. Maybe I should join the second life. Okay, I am joining second life.
Once this Orkut craze was over, I have now got into another addiction & this time it is on-line movies. but anyways not complaining yet. The reason being the project is in kind of unravelling state and so I have figured out that it's no use working hard or maybe I guess even working. The result is crystal clear, we ain't going to survive the next cutback the client proposes. So chill out & have a good time, for the show must go on. You know, whenever I say that line I recollect a poem that we had in our early school days which had the lines 'For men may come and men may go, But I go on for ever.'' Its funny for I recollect only one another poem, Robert Frost 'Woods Poem' & that too because every time I come from home in Dehra Dun, the thick dense jungle just reminds me of the last two lines, where the poet marvels at the dense forest & wishes for a path less travelled. Its strange how some memories are there in you mind embedded for ages & there are some I won't say memories, but reaction which are difficult to fathom. say for, whenever I hear Beatles's 'And I Love Her' I feel some strange melancholy but this sadness has no face & has no reason. Maybe I shouldn't hear that song.
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