Author: SK

Slender Loris and Punny Animal Names

I think one of my cousins ( a very young fellow) looks like a Slender Loris, and refer to him by that name. Unfortunately, I can’t make the nickname official because of a punny reason.

The Kannada word for Slender Loris is “Kaadupaapa” which is supposed to mean “baby of the forest” or some such thing. The problem arises with the word “Kaadu” which can refer to both forest and as “troublesome”. I suppose the reason for these diverse meanings is some sort of root meaning “wild”.

So Kaadupaapa can also mean “troublesome baby”. There’s more to it. “Kaadupaapa” also happens to be a fairly common abuse that is directed at young kids when they get too troublesome. I clearly remember my mother abusing me using this phrase a few times when I was small. So nicknaming a young boy as Kaadupaapa would be similar to some guy in IIT being given a nickname such as “bastard” or “chutiya”. And clearly the parents of the kid will not approve and the baptist will end up getting a bad name in their eyes.

This unfortunate combination of circumstances means that I can’t make official what I think is a splendid nickname. At least, in IIT I didn’t have to bother about what the parents of the boys would think about the nicknames that I’d dole out, which enabled me to dish out a few decent ones. Though I admit that a conspiracy by the institute to deny freshies to Narmada Hostel meant that there weren’t too many people I could have named.

The Aftermath

Baada collaborated on the research leading up to his post. I hereby acknowledge his contribution and condemn his laziness for not blogging it himself.

One of the major problems of the financial crisis that has been happening for about two years now is that investment bankers, as a profession, stand discredited. Before this, they used to claim to be on the top of the intellectual ladder. And now, thanks to a handful (more than a handful; but still a small proportion) of phenomenally stupid investment bankers, the entire community stands discredited. Not just that, they have left the community of quants, of people who can be good at structuring, of finance people, of statisticians, all discredited. You say “all you need to do is to get a few ibankers into these jobs” and you’ll have people come at you like a pack of hounds, waving Mint and saying “look at the damage these buggers have caused, and you think they can solve this problem”.

So Baada and I were talking about cricket the other day. About how thanks to the demands of television, flat pitches are being prepared everywhere. Which is leading to tame and boring draws. Which has led to domestic cricket being effectively reduced to a one-innings game. Which has led to massive fourth innings run chases. Which has led to bowlers break down once every couple of seasons. And so forth.

The argument put forth in favour of flat pitches is that in order to maximise television revenues, you need the game to last five days. Excellent argument, and Baada and I agreed to it. But the friggin’ point is that if you have  a boring game, no one is going to watch it. If you have a game that is most likely to end up as a draw, it will have no audience. Advertisers would be paying through their nose for near-zilch viewership.

In the medium term, things should even out. Advertisers will realize that due to the boring nature of Test cricket, no one will watch it anyway, and will back away. Ad rates will fall. And TV rights bids will fall consequently. And the boards will understand their folly and take steps to make cricket interetsing again. (there is also the danger that boards will use this to say that no one watches Test cricket anymore and scraps it altogether). However, advertisers should not be so passive and wait for things to even out.

Given a large number of statistics, playing conditions, day of week seasonality and all such stuff, it shouldn’t be hard for the smart advertiser to figure out which are going to be his most profitable slots. And bid specifically for those. If one smart advertiser does that, then that advertiser stands to gain against other advertisers who will end up paying more money for less profitable slots. And so all advertisers will become smart. Now, the channels will stop seeing uniform demand patterns for their various advertising slots. They will now need to acquire smartness in order to combat the smart advertisers. This way, smartness will prevail in the system.

I’m sure that once something like this happens, natural balance will get restored. It will take much less time for TV channels to realize that three-day Tests on bowling pitches can get them greater revenues compared to runfests played over five days. And they won’t take much time to communicate the same to the boards who will then restore Test cricket back to glory.

The problem with a lot of advertising people is that they see themselves as “creative people” because of which they assume they don’t need to know and use maths. And they don’t do the smart calculations I described earlier. As for the brand managers, it is likely that a lot of them decided to pursue marketing because they either didn’t like quant or found themselves weak at quant. Apart from a few simple excel models, they too are likely to shun the kind of smartness required here.

So where are the white knights who can save the version of the gentleman’s game played in whites? Not currently in the ad agencies. Most likely not in the marketing departments. They are all out there. A few months ago, they were employed. Earning very good salaries, and grand bonuses. Earning amounts of money unaffordable to most advertising and marketing companies. Thanks to the financial meltdown, they are available now. Looking for a fresh challenge.

This is the best time for you to infuse quant to your business. You won’t get the kind of quant supply in the market that you are seeing now. Even if the financial industry doesn’t recover (in any case it will never go back to 2007 levels), supply side factors should ensure lower supply. Do that little experiment now. Acknowledge that numbers can do a lot of good for your business. Understand what structuring is all about, and estimate the kind of impact a good structurer can have on your revenues. Make that little bit effort and I’m sure you’ll get convinced. Go make that offer. An offer these ex-ibankers can’t refuse in the current circumstances at least.

PS: When I refer to investment banking, I also include the “outside-the-wall” side of the business (called “markets”; “sales and trading”; “securities” and various other names). In fact, I mostly talk about the outside-the-wall business, not having had any exposure inside the wall.

Half a rupee

At the end of the first week, I had run up a debt of half a rupee – following some settlements we had to make at the Xerox shop.

Back home for the weekend, I happened to find two twenty-five paisa coins while cleaning out my desk.

I gave them to her first thing on Monday morning, in full view of the class. She has never been nice to me after that.

Money and religion

No matter how much you preach, how much you write, how many arguments you make in favour of your stand that there is no god, the believers will ignore you. And given that believers usually have strong sense of belief, it is very unlikely that your preaching and reasoning will have any effect on them.

Instead, the easiest way for you to spread your message is to make the religious ones pay. Literally. Religious arbitrage, I call it. Religion usually comes with a set of beliefs. And superstitions. And the religious people are more likely or less likely to do certain things because of their beliefs. And you need to exploit these beliefs. Exploit them as much as you can, and try make money at the believers’ expense.

My argument is this: if you think your religion or the lack of it is better than any other religion, there must surely be a way in which you can exploit this to make money at the expense of the other religion. So go ahead and do it. Nothing talks like money.

I did my bit in this direction last Diwali. I went to buy a mobile phone, and figured that it being dhan teras the shopkeeper was loathe to send me away without selling me anything. I managed to get the phone for almost a thousand rupees below what it cost the shopkeeper (I confirmed this figure with a friend who is a sales manager at Nokia). The poor guy even gave me a bill for an amount much larger than what I’d actually paid.

You might claim that I could have bargained harder. But as I said, even religion has its monetary limits, and the shopkeeper would’ve figured that incurring the wrath of the gods would’ve been cheaper than selling the phone to me for lower than he actually did.

So stop preaching. Stop preaching when you know you have no chance. Stop bringing up the FSM in every line of conversation. And let money do the talking.

PS: Religion might just be a special case for this argument. You should be able to take advantage of all sorts of beliefs (including the non-religious ones) using this strategy.

Year Ending Post

Last december 31, I wrote a this day that year post. Two years back, I had published a short story. The year before, I had written about the events of the day, and one year prior I was mugging for what was going to be a disastrous marketing exam. As I am writing this, I’m playing scrabble on facebook, and bridge with my computer. I’m listening to music, and am planning to hit the sack soon.

This afternoon I received a mail from my boss, which he said is a standard format mail he sends to friends and colleagues. It was full of pictures of him and his wife and his kids, and stories about what they did this year. About the changes and special events in each of their lives. About how the year has been from different perspectives. And so forth. I think I have received a couple of other similar mails (from US based people – this might be some american funda; my boss also lived in America till early this year) from other acquaintances (though, without pics) which I haven’t bothered to read. Since I’m clueless about what to write, I think I’ll just do a standard year-end roundup.

The most significant thing for me was my move to Gurgaon, and to this new job. That had been preceded by four months of joblessness, and more than two years of acute NED (in fact, I think it was during this period of extended NED that I actually invented the term NED).

The concept of NED also seemed to advance by leaps and bounds this year. I have heard of people who are at least three degrees away from me use it. The message of this concept seems to be spreading. I am sure that one day it will be famous, but then I’m not sure if I, as its inventor/discoverer, will get due credit.

Another significant event of the year has been the movement of this blog from livejournal to its present location. I must mention that this website has been like “glad bangles” for me. A week after I inaugurated this, I had a nice job offer, ending over a year of NED. There were a few other changes also in my life around that time, which I don’t remember now. What I do remember was classifying this website as “glad bangles”. and I like this better than Mad Angles.

On the louvvu front, it was a very quiet year, apart from one quick episode. Maybe one of the least productive years – comparable, maybe, to my years back in IIT.

Ok I think NED is happening. i just resigned my scrabble game. I had resigned my bridge game ages back, and I’d closed the program. I’m feeling sleepy now. So I’ll close it here. Happy new year. And I think this is the worst year-ending post that I’ve written in a long time. This website maybe deserved a much better new year post in the year end but it’s ok.

First name basis

1. I’ve noticed that people in the South use first names much more commonly than in the North. I can think if a simple explanation for this – south indians either don’t have family names (tn, old mysore) or have unpronouncable/hardtoremember family names (andhra/kerala). so a south indian Siddharth Tata is likely to introduce himself as T. Siddharth whereas a north indian Siddharth Tata is likely to say S. Tata.

2. I’ve noticed in my extended family that concepts such as “aunty” and “uncle” made their entry only in my generation. I’ve never heard either of my parents using either of these words, or any of their Kannada synonyms. Everyone is addressed by their first name, irrespective of whether he is nephew/cousin/uncle/granduncle.

However, this firstname thing stops at the family level and doesn’t extend to work. People unrelated to you instinctively become Sir or Madam (this is in my parents’ generation. I don’t know how people in my grandparents’ generation addressed unrelated people). In fact, all of my mom’s male colleagues used to address her as Madam (or I should say may-dum).

I don’t have data to support it but it is possible that this Sir business has something to do with the British Raj, and wasn’t common in South India before that. I don’t know how far back the “ji” system in the North goes (i know it goes back at least as far as Gandhiji), but my general sense is that it is fairly ancient.

Ok – so – here is the hypothesis. We Indians are not hierarchical at the family level. Despite all talk of “don’t question your elders” and similar sundry stuff, I don’t think at the family level we are inherently hierarchical. However, go beyond the family and the caste system takes over and brings in a social hierarchy – which is why everyone outside the family becomes “sir”, etc.

Bangalore Photowalk 5

Ok. So the Bangalore Photowalk has been resurrected. You might recall that I stopped coordinating them after I moved out of Bangalore, and Shande who had volunteered to coordinate had been out of town, and so the Photowalks had come to an abrupt end.

Anyways, over the last few days, the photowalk yahoogroup has seen much activity, with people demanding a photowalk. And the people have gotten together to give themselves and the rest of Bangalore one.

This will happen tomorrow evening, along Brigade Road. The group will assemble in front of the defunct Opera Theatre on Brigade Road (you might recall that Photowalk 3 had also begun there). Since I have moved out of Bangalore, I won’t be there. However, the response to this photowalk looks enthusiastic and so you can expect a good crowd.

Details:

Starting point : Brigade Road – Residency Road Junction.
End point:         Commercial Street

Starting Time : 6 pm

Check this google map link for details.

http://maps.google.com/maps/ms?ie=UTF8&hl=en&msa=0&msid=106135947463286202488.00045f40af5e0f4a91835&ll=12.976415,77.609868&spn=0.018735,0.027637&z=15

As per map, the distance is around 3700 feet i.e. just above a km.

I encourage you to land up at Brigade Road tomorrow evening along with your cameras. I’m sure it will be a lot of fun.

Thanks to Anita and Shande, among others, for putting enthu to resurrect the Bangalore Photowalk.

Location matters

The other day in my office we were discussing recruitment. I pointed out that placements this year in the IITs have been particularly screwed. We haven’t decided if we can wait till July for the new recruits to join, but if we agree that it’s ok, we might recruit from IIT. Given our size and meagre requirements, if we do recruit, it’s likely to be from IIT Delhi. The CEO happens to be from there, but that won’t be the reason we might be  going there. It is simply to do with cost.

A number of people think that good colleges can lead development. I’m not sure if that is the case. Unless there is a massive cluster of colleges that comes up in some place which makes it attractive for people to set up industries, which can then recruit from the colleges. Until that happens, and you never know how long it will take for that to happen, the students in these colleges are effectively screwed. At least much more screwed than those in colleges in better locations.

For big companies it doesn’t matter. Their recruitments are such that they can’t possibly make do with taking people from the closest IIT (since we’ve started talking about IITs, let’s keep that as the standard). They will need to go to every IIT. And recruit from all  the places, irrespective of how much it costs them to recruit from there. So you will have people talking about big names that go to different IITs. Big companies with big names. I don’t think there will be significant inter-IIT difference in there.

However, where the students of remotely-placed IITs will miss out on is in terms of small, and maybe growing companies. Companies such as ours. We are located in Gurgaon, and might not need more than a couple of people. And from a simple cost perspective, there is no reason we should step out of Delhi for our IIT Campus recruitment. If we were located in Bangalore or Madras, and wanted to recruit from an IIT, we would’ve gone to IITM. It is about cost. Total cost of recruitment, measured against expected quality of candidates. So we go to the closest and most accessible IIT.

During my time at IITM (2000-2004), there were hardly any non-software companies that came to recruit. There were a few “big boys” that came (McKinsey, Levers, etc.) but they were large enough to go to every IIT. Not-so-large financial sector companies that were based in Bombay would simply just recruit from IITB. Outsourcing companies based in Gurgaon would go to IITD. The south had (and has) mostly software companies, and they would recruit from Madras.

Then there is the accessibility factor. Now, if I were to decide that my requirements won’t be fully met at IITD, and I want to recruit from a couple of more IITs, I would probably intuitively go to Bombay and Madras. Simply because they are well connected by flight from Delhi, and have good hotels to stay at if I want to interview over a couple of days. I’m not even sure if Kanpur and Kharagpur have airports. And I definitely don’t fancy staying at hotels in either of these places.

Popular notion is that IITs at Bombay and Delhi have traditionally had superior placements compared to other IITs. It is simply because they are located in superior places (Madras might have also been there but for some reason has historically shown a tendency to send most of its graduates to the US, because of which local recruiters don’t fancy it too much). Even if you are the smartest guy in Kanpur or Kharagpur, there is a good chance that you might lose out to a much less smart and much less hardworking guy than you in Bombay or Delhi. Simply because they are more accessible.

There is of course the contrarian viewpoint. Low supply of jobs at the less urban IITs means that as a recruiter, I should find it easier to get better people there, than I would in the IITs in the big cities. Again, it depends on how much incremental value I place on the “better students” at the less urban IITs. In most cases, however, it is likely that I would find that this incremental value wouldn’t justify my costs, and end up going to an urban IIT.

So who would recruit from the urban IITs? Apart from the big guns, of course. Think of institutions that don’t require a face-to-face interview for recruitment. Graduate schools. Large software companies which recruit without interviews (based on a test, etc.). Foreign companies that interview via videoconference. And I hear that nowadays, McKinsey has started flying down its shortlisted students from non-Bombay non-Delhi IITs to its own office and interviewing them there – maybe a few other extremely quality-conscious companies might emulate this model.

So if you have just passed the JEE, and don’t know which IIT to go to, you might want to keep this in mind. I know that at 17, you want to go to the IIT closest to home (at least, that is the reason I picked Madras). But keep this at the back of your mind – going to an IIT in a bigger city is definitely going to give you better options after your engineering. If you are extremely sure that you want to do a PhD in your chosen branch of engineering, then it doesn’t matter. Go anywhere. But if you want to keep your options open, go to the big cities. Bombay. Delhi. Madras.

PS1: In this post I have used IITs as only an indicative example. This applies to all colleges, irrespective of area of study. Basic moral of this essay is that if you have a choice between similar colleges of similar reputation, choose the one in the bigger city

PS2: I have no clue about our recruitment plans. I don’t even know if we will recruit. If you are a placement representative, please DON’T bombard me with “can you recruit from my IIT” mails. If we want to recruit from your college, we will get in touch with you.

PS3: Has any of you observed that if you consider Kharagpur as being close to Calcutta, the location of the 5 IITs are the same as the five cities where Test cricket was played in India in the 1950s. Maybe if Kharagpur hadn’t come up in 1950 itself, it would’ve been set up somewhere close to Eden Gardens.

What rate of interest did Kubera charge?

It is fairly well established that Tirupati Venkataramana (it is Venkataramana and not Venkateshwara – remember that it is a Vaishnavite temple) took a loan from Kubera in order to finance his wedding to Padmavati. And till date, Venkatarmana has been soliciting contributions from visitors to his shrine in order to help him pay off this loan. Given that the loan was for the purpose of getting married, I think we can quickly establish that it was a Personal Loan. What I’m trying to figure out, however, is what rate of interst did Kubera charge Venkataramana.

For starters, I think somewhere in our scriptures, we can find out the amount that Venkataramana borrowed. Rupees didn’t exist in that era, but I’m sure we can find some figures in terms of gold, or other commodities. And we should be able to estimate the rupee value of this loan by suitable backward extrapolation.

What might be slightly tougher is the time period. When did Kubera exist? When did Venkataramana exist? When did he get married to Padmavati? The date is important, for we should know how many years to discount for when we do the IRR calculations. However, I’m sure that with sufficient effort, we should be able to find the date of this particular transaction to the nearest millenium.

Then, there are the loan repayments. Let us assume that Venkataramana is in general a poor man, and his repayments can be approximated to the amount of offerings he receives from visitors to his shrine. Catch a few people sitting for McKinsey interviews, and estimating this amount is also not going to be very tough. We should be able to get fairly accurate figures for the last few years, and then we should be able to appropriately extrapolate backwards accounting for various regime changes (I’m assuming here that the temple, for whatever reason, will refuse to cooperate in this noble endeavour – else we can get the repayment amounts from the temple books).

We also need to remember that the repayment is not complete. People still contribute generously to the Venkataramana Personal Loan Repayment Fund. However, if we assume that the loan has already been repaid, we can get a floor on the rate of interest that Kubera charged. It is intuitive right – that if more money pours in, the interest rate would’ve been higher? Let us also assume that there were no repayments till about five hundred years ago, which was approximately when the temple was built. Assuming zero repayments till then, it again gives a floor on the interest rate.

Obviously, I don’t already have any of the data that I’ve mentioned here, so I can’t actually do the calculations. However, if McKinsey decides to solve this problem, they can do so in March during their interviews at IIMs. My prediction, however, is that the rate of interest will come out to be a number which, in normal circumstances, would be found to be usurious. Thus, we might probably be able to show that people are contributing to funding a greedy usurious rich moneylender when they contribute to the Venkataramana Personal Loan Repayment Fund. I don’t know what further use this might be put to, but I think the process will be an end in itself.

On a closing note, I would like to point out the greatness of our culture – which, even in mythological times, could boast of complicated financial products such as Personal Loans. This one factor, I think, is enough to show that our Indian culture is superior to all other cultures.

PS:  Sometime back, I was wondering if the Venkataramana Personal Loan Repayment Fund could be the largest money-laundering operation in India. However, a little thinking revealed that our political parties are definitely far far ahead when it comes to that.

Tenure matching and jab we met

ok this is one of those lazy posts. Takes two earlier posts and finds a connection between them. This is the kind of stuff that bad professors do – take two old papers, find a link between them and publish a third paper. I do hope to become a prof one day, but I don’t hope to write such papers.

if you remember my review of Jab We Met (which I wrote about a month back), I had said that I hadn’t liked the ending. I had said that if I’d written the script, I’d’ve made Anshuman a stronger character, and made Geet marry him; and have Aditya walk away into the drizzle. I had said that this was because Aditya and Geet had added as much value as they could to each others’ lives.

So, now, if you look at it in terms of tenure matching, things will become clearer. Both of them had their own problems, which needed solutions. And neither of them had a problem for which the solution involved marriage. Ok wait. Geet did have a marriage problem. She wanted to marry Anshuman, and needed to find an efficient way of eloping with him and marrying him. So looking at it from the scope sense, all she needed was someone to guide her in her efforts to do the same.

Aditya’s problems, too, weren’t something for which marriage was an obvious solution. He had put extreme NED at work, and was on the verge of killing himself. All he needed was someone to guide him out of NED. Someone to show him that life can be beautiful, and happy, and that he shouldn’t take any extreme steps.

Looking at the movie from this context, it is clear that marriage between Geet and Aditya wasn’t warranted. Ok it might have been a “no-so-bad extension” but it wasn’t required. It wasn’t a solution that fit in any way with the problems that they were facing in their lives. Which is why the ending stuck out like a sore thumb (and that excess song-and-dance and loudness and all that contributed in no measure) .

Ok now I realize that I shouldn’t be analysing Bollywood movies from a logical standpoint. but still…