Category: business

What’s your Raashee? Astrology and Vector Length

The problem with western astrology is that there are way too few categories of people according to it. Western astroogy uses a vector of length one – the part of year in which you were born in, and then concocts a story based on that. According to that, people can be classified into twelve categories (as can be seen in the great recent movie whose title is a substring of the title of this blog post) and you can tell their story based on that. Thing is that way too many people you know, and are not like you, are in the same category as you, and this makes things so much less believable.

On the other hand, the beauty of Indian astrology is the vector length that is involved with it. There are nine planets (including the Sun and the Moon, not including the Earth, and with Rahu and Ketu instead of Uranus and Neptune) and at the time of your birth, each of them can be in one of 10 houses (not sure of the number but I think this is it). There are correlation issues so the number of possible combinations isn’t as big as you think it might be, but still there are enough possible combinations that can describe each person you know uniquely!

This ability to identify almost each person uniquely is what makes Indian astrology so fascinating. Stuff is so complicated that you will never understand it. And because you will never understand it, you are more likely to believe it; unlike in western astrology where it is easy for you to see where you fit in, where things are so easy that it is easy for you to see through it.

The other thing about Indian astrology is that given the really large number of variables, it is easy for the astrologer to correct his own mistakes. He will say “Jupiter is in position 7 so X will happen” and then if X doesn’t happen he says “yeah i predicted it based on Jupiter being in 7, but then in the meantime the Sun moved into 8, and so death happened off”. It makes things so easy to cover up that it contributes to the mystique, and to the success of the art.

So a possible moral of the story is that if you want to create fraud frameworks, make sure that they involve long vectors. Make sure that you design them in such a way that the mango person won’t understand; Make sure that you build in enough variables that will allow you to cover up in case when you screw up. Make sure the vectors in your framework are long enough to make the users feel special and unique, yet giving them a feel that you’ve seen someone/something similar before.

I think this is what all the successful consulting firms have done. Perfected this art of coming up with this kind of a vector. And to think that they might have been inspired by Indian astrology..

Bangalore Book Festival

So today I made my way to Gayatri Vihar in the Palace Grounds to visit the Bangalore Book Festival, on its last day. It was interesting, though a bit crowded (what would you expect on the last day of an exhibition? and that too, when it’s a Sunday?). I didn’t buy much (just picked up two books) given the massive unread pile that lies at home. However, there was much scope for pertinent observations. Like I always do when I have a large number of unrelated pertinent observations, I’ll write this in bullet point form.

  • There were some 200 stalls. Actually, there might have been more. I didn’t keep count, despite the stalls having been numbered. Yeah, you can say that I wasn’t very observant.
  • All the major bookshops in Bangalore barring the multicity ones had set up shop there. I don’t really know what they were doing there. Or were they just trying to capture the market that only buys in fairs? Or did they set up stall there just to advertise themselves?
  • It seems like a lot of shops were trying to use the fair to get rid of inventory they wanted to discard. All they had to do was to stack all of this on one table and put a common price tag (say Rs. 50) on every book in that collection, and it was enough to draw insane crowds
  • One interesting stall at the fair had been set up by pothi.com an online self-publishing company. I’ll probably check them out sometime next year when I might want to publish a blook. Seems like an interesting business model they’ve got. Print on demand!
  • I also met the flipkart.com guys at the fair. Once again, they were there for advertising themselves. Need to check them out sometime. Given the kind of books I buy, I think online is the best place to get long tail stuff.
  • There was an incredibly large number of islamic publishing houses at the fair! And have you guys seen the “want qur an? call 98xxxxxxxx for free copy” hoardings all over the city? Wonder why the Bajrang Dal doesn’t target those
  • There was large vernacular presence at the fair. I remember reading in the papers that there was a quota for Kannada publishers, but there was reasonable presence for other languages also, like Gult, Tam, Mellu, Hindi
  • A large number of stalls were ideology driven. Publishing houses attached to cults had set up stalls, probably to further the cause of their own cult. So there was an ISKCON stall, a Ramakrishna Mutt stall, a Ramana Maharshi stall, etc.
  • Attendance at most of these niche stalls was quite thin, as people mostly crowded the stalls being run by bookstores in order to hunt for bargains. Attendance was also mostly thin at publisher-run stalls, making me wonder why most of these people had bothered to come to the fair at all.
  • I saw one awesomely funny banner at the place. It was by “Dr Partha Bagchi, the world leader in stammering for last 20 years” or some such thing. Was too lazy to pull out my phone and click pic. But it was a masterpiece of a banner
  • Another interesting ideological publisher there was “Leftword books”. Their two sales reps were in kurtas and carrying jholas (ok I made the latter part up). And they were sellling all sorts of left-wing books. Wonder who funds them! And they were also selling posters of Che for 10 bucks each
  • I wonder what impact this fair will have on bookstores in Bangalore in the next few days. Or probably it was mostly the non-regular book buyers who did business at the fair and so the regulars will be back at their favourite shops tomorrow.

I bought two books. Vedam Jaishankar’s Casting A Spell: A history of Karnataka cricket (I got it at Rs. 200, as opposed to a list price of Rs 500) and Ravi Vasudevan’s “Making Meaning in Indian Cinema”.

A Balance Sheet View of Life

The basic idea of this post is that interpersonal relationships (not necessarily romantic) need to be treated as balance sheets and not as P&L statements, i.e. one should always judge based on the overall all-time aggregate rather than the last incremental change in situation.

Just to give you a quick overview of accounting, the annual statement typically has two major components – the P&L statement which reflects what happened between the last release of the statement and the currrent point, and the balance sheet which reflects the position of the company at the point of time of release of the statement.

I think Bryan Caplan had made this point in one of his posts, but I’m not able to find it and hence not able to link it. The point is that you should look at relationships on a wholesome basis, and not just judge it based on the last action. The whole point is that there is volatility (what we refer to in my office as “the dW term”) and so there are obviously going to be time periods during which you record a loss. And if on each of these occasions you were to take your next course of action based on this loss alone, you are likely to be the loser.

I’m not saying that you should ignore the loss-making periods and just move on. You do need to introspect and figure out what you need to do in the next accounting period in order to prevent this kind of a loss from repeating. You will need to “work the loss”, not make a judgment to break the relationship based on it. I think a large part of the problems in this world (yeah, here goes another grand plan) stems from people using one-period losses in order to take judgments on relationships.

Another thing is not to generate the accounting statements on a shorter time period. This is similar to one funda I’d put long ago about how you shouldn’t review your investments at extremely short intervals since that will lead to a domination of the volatility term (dW) and thus cause unnecessary headache. You might notice that corporates rarely release their accounts statements more frequently than once a quarter – this has more to do with volatility than with the difficulty in generating these statements.It is similar in the case of interpersonal relationships. Don’t judge too often – the noise term will end up dominating.

One caveat though – very occasionally the last loss may be so bad that it more than wipes out the balance sheet and takes to zero (or even less) the value of the firm. In that kind of a situation, there is no option but to shut down the firm (or break the relationship) and move on. Once again, however, the clincher in the decision to break up has to be the balance sheet which has gone to zero (or negative) and not just simply the magnitude of the last loss.

Life based on a balance sheet view is a balanced life.

Collateralized Death Obligations

When my mother died last Friday, the doctors at the hospital where she had been for three weeks didn’t have a diagnosis. When my father died two and a half years back, the hospital where he’d spent three months didn’t have a diagnosis. In both cases, there were several hypotheses, but none of them were even remotely confirmed. In both cases, there have been a large number of relatives who have brought up the topic of medical negligence. In my father’s case, some people wanted me to go to consumer court. This time round, I had signed several agreements with the hospital absolving them of all possible complications, etc.

The relationship between the doctor and the patient is extremely asymmetric. It is to do with the number of counterparties, and with the diversification. If you take a “medical case”, it represents only a small proportion of the doctor’s total responsibility – it is likely that at any given point of time he is seeing about a hundred patients, and each case takes only a small part of his mind space. On the other hand, the same case represents 100% for the patient, and his/her family. So say 1% on one side and 100% on the other, and you know where the problem is.

The medical profession works on averages. They usually give a treatment with “95% confidence”. I don’t know how they come up with such confidence limits, and whether they explicitly state it out, but it is a fact that no disease has a 100% sure shot cure. From the doctor’s point of view, if he is administering a 95% confidence treatment, he will be happy as long as his success rate is over that. The people for whom the treatment was unsuccessful are just “statistics”. After all, given the large number of patients a doctor sees, there is nothing better he can do.

The problem on the patient’s side is that it’s like Schrodinger’s measurement. Once a case has been handled, from the patient’s perspective it collapses to either 1 or 0. There is no concept of probabilistic success in his case. The process has either succeeded or it has failed. If it is the latter, it is simply due to his own bad luck. Of ending up on the wrong side of the doctor’s coin. On the other hand, given the laws of aggregation and large numbers, doctors can come up with a “success rate” (ok now I don’t kn0w why this suddenly reminds me of CDOs (collateralized debt obligations)).

There is a fair bit of randomness in the medical profession. Every visit to the doctor, every process, every course of treatment is like a toin coss. Probabilities vary from one process to another but nothing is risk-free. Some people might define high-confidence procedures as “risk-free” but they are essentially making the same mistakes as the people in investment banks who relied too much on VaR (value at risk). And when things go wrong, the doctor is the easiest to blame.

It is unfortunate that a number of coins have fallen wrong side up when I’ve tossed them. The consequences of this have been huge, and it is chilling to try and understand what a few toin cosses can do to you. The non-linearity of the whole situation is overwhelming, and depressing. But then this random aspect of the medical profession won’t go away too easily, and all you can hope for when someone close to you goes to the doctor is that the coin falls the right way.

Interview length

When I interviewed for my current job four months back, I was put through over twelve hours of high-quality interviews. This includes both telephonic and face-to-face processes (on one day, I was called to the office and grilled from 1030am to 630pm) and by “high quality”, I’m referring to the standard of questions that I was asked.

All the interviews were extremely enjoyable, and I had fun solving the problems that had been thrown at me. I must mention here that the entire process was a “stud interview” – one that tried to evaluate me on my thought process rather than evaluating what I know. I’ve also been through a few “fighter interviews” – ones where the interviewer just spends time finding out your “knowledge” – and I don’t remember taking a single job so far after passing this kind of an interview.

So recently I read this post by Seth Godin that someone had shared on Google Reader, where he says that there exists just no point in having long interviews and so interviews should be kept short and to the point. That way, he says, people’s time gets wasted less and the candidate also doesn’t need to waste much time interviewing. After reading that, I was trying to put my personal experience into perspective.

One thing is that in a “stud interview”, where you throw tough problems at the candidate, one of the key “steps” in the solution process is for an insight to hit the candidate. Even if you give hints, and mark liberally for “steps”, the “cracking” of the problem usually depends upon an insight. And it isn’t fair to expect that an insight hits the candidate on each and every question, and so the way to take out this factor is by having a large number of questions. Which means the interview takes longer.

The other thing about the length of the interview is signaling. Twelve hours of hardcore problem-solving sends out a signal to the candidate with regard to the quality of the group. It gives an idea to the candidate about what it takes to get into the group. It says that every person working in the group had to go through this kind of a process and hence is likely to be of high quality.

Another thing with the “stud interview” is that it also directly gives the candidate an idea of the quality of the people interviewing. Typically, hard math-puzzle based interviews are difficult to “take” (for the interviewer). So putting the candidate through this large number of math-problem-solving interviews tells him that the large number of people interviewing him are all good enough to take this kind of an interview. And this kind of interviews are also ruthless on the interviewer – it is usually not hard for a smart candidate to see through it if he thinks the interviewer has just mugged the answer to a question without actually solving it.

All put together, when you are recruiting for a job based on “stud interviews”, it makes sense for you to take time, and make the candidate go through several rounds. It also usually helps that most of these “stud interviews” are usually fun for the candidate also. On the other hand, if you are only willing to test what the candidate knows and are not really interested in the way he thinks, then you might follow Godin’s suggestion and keep the interview short.

The Loot

So I executed the book binge yesterday. In two phases – first at the “main” Landmark at the Forum and then at the “other” Landmark at Swagath Garuda Mall. Technically the binge is incomplete since I still have another Rs.600 to spend but it’s unlikely I’ll be spending that off soon, so for all practical purposes we can take the binge to be complete.

While book-shopping yesterday I was thinking about the various Landmark stores I’ve been to, and how the Landmark at the Forum is the worst of them all, with the one at Spencer’s Plaza in Madras (which I last visited seven years back) coming second. The problem with these two stores is that they are in otherwise popular malls. What this does is that it attracts casual browsers to just check out the mall and makes the browsing experience more painful for the serious browsers.

On the other hand, the Landmark stores in Nungambakkam, Gurgaon (Grand Mall) and Garuda Swagath Mall are either standalone or situated in malls which are otherwise not too popular. And precisely for this reason, the crowd at these stores is significantly superior. You get your space to browse without being asked to make way for passerby, you can actually sit down going through a book and deciding whether to buy it. The store staff, who are much less hassled, are far more courteous and helpful. And if you happen to pick up a conversation with another browser, it is likely to be much better than at the more popular malls.

This presents an interesting problem for the bookshop-owners regarding location. Do they put the bookshop in a popular mall and thus maximize footfalls? Or do they locate their shops in lesser malls or on high streets hoping to attract better “quality” of footfalls which might actually result in better sales? Keeping the shop in a popular mall attracts more casual browsers and if book purchase is an impulse decision, then it is likely to pay off for the store (even there you need to keep in mind that crowded checkout counters can cause the casual browser to drop the book back in the shelf). On the other hand, if they think book buying is a more informed, laborious decision, then they should be locating themselves in places where they won’t get random crowd.

Of course I’m only talking about the browse-and-buy model here and not covering shops such as the erstwhile Premier Bookshop – which rely on customers who know exactly what they want and just ask for it. And of course, for a shop to locate itself in a slightly obscure location it needs to have the “pull” (of a brand name or something) in order to attract customers.

Coming to the loot:

  • The Naked Ape, Desmond Morris
  • The Great Railway Bazaar, Paul Theroux
  • The Emerging Mind, VS Ramachandran
  • The Flight of the Creative Class, Richard Florida
  • Panic, Michael Lewis
  • A Splendid Exchange (How Trade Shaped the World), Willian Bernstein
  • Gang Leader For A Day, Sudhir Venkatesh
  • The Bowler’s Holding the Batsman’s Willey (humorous sporting quotes collection), Geoff Tibballs
  • Musicophilia, Oliver Sachs
  • The Oxford Book of Modern Science Writing, Edited by Richard Dawkins
  • When Genius Failed (LTCM), Roger Lowenstein
  • Ramayana, a modern rendition, Ramesh Menon
  • The Rise and fall of the third chimpanzee, Jared Diamond
  • Bhairavi, the global impact of indian music, Peter Lavezzoli
  • The Real Price of Everything (collection of 6 economics classics – fundaes by adam smith, david ricardo, etc.), Edited by Michael Lewis
  • Predictably Irrational, Dan Ariely
  • The Universal History of Numbers (Part 1 and 2), George Ifrah (didn’t buy part 3 since it seemed full of CS fundaes)
  • A Maidan View, Mihir Bose
  • The States of Indian Cricket, Ramachandra Guha
  • The Bhagavad Gita, Royal Science of God-Realization, Paramahamsa Yogananda
  • Autobiography of a Yogi (Kannada translation), Paramahamsa Yogananda (mom and aunt asked for it)

People, thanks for your recommendations. And once I’m done reading these books, I might be open to lending them (provided I trust you to return them, of course).

Studs and Fighters and Form

It’s been a long time since I wrote about the Studs and Fighters framework. I had overdosed on it a few months back, when I’d put some 3 posts in 4 days or something, but that was when I was hajaar enthu about corporate affairs.

It’s been almost two months since I quit my last job, and in this period, among other things I’ve lost all enthu for anything corporate. I don’t find Dilbert funny anymore. I usually just put well left to the office-politics posts that some of my friends on Google Reader share. And since the S&F theory was mainly meant to deal with corporate situations, that too has gone to the backburner.

I was thinking about Mitchell Johnson’s inclusion in the Aussie team in the Third Test. Given how badly he has been bowling all tour, and given that Stuart Clark hasn’t been bowling badly at all, it seems like a surprising selection. But dig deeper, and employ my favourite framework, and you’ll know why he’s still in the team.

It seems like Johnson is a stud bowler (as I’d remarked earlier, Test match bowling in general is stud). And the theory goes that form matters so much less for the stud. This is mainly because studs are significantly more inconsistent than fighters, which makes forecasting one data point based on historical data a nightmare. This also means that the last few data points say much less about a stud’s next data point than they do for a fighter’s case.

All that a stud needs to do to make amends for his hitherto bad form is to come up with one, or maybe a handful of moments of inspiration/insight. And that can happen any time. In fact, theory says that it is more likely to happen when the stud is defocussed on what needs to be done.

So even in the first couple of Tests, you could see Johnson occasionally coming up with the totally awesome delivery, which would produce wickets. Most of the time he was crap, but the occasional moments of brilliance were enough for him to make an impact. So the thinking in persisting with him is that sooner or later, he will produce enough moments of brilliance in a game that no one will look at all the crap he has bowled, and even that the moments of brilliance can push up his confidence which can lead to less crap.

This kind of thinking doesn’t apply to a traditional fighter, who isn’t capable of that “moment of brilliance”. He usually relies on consistency, and accuracy, and process to do what he needs to do. For the fighter, it has to be a steady rise from one “form situation” to another. And so persisting with the fighter doesn’t make sense. So for example, if Mike Hussey continues batting in the same way as he has been this series, there is a case of sending him to domestic cricket.

The problem with a lot of fighters is that they refuse to acknowledge the existence of studs and treat them too as fighters (on the other hand, most studs understand the existence of fighters). And this treatment of studs (assuming they are fighters) can have disastrous effects.

The Trouble with Orkut

Some of you might have noticed that I haven’t been replying to your messages on orkut any more. I still exist there, but am not “active” by any stretch of imagination. I check my account once in a long while, when I’m feeling really bored. And make a conscious decision not to reply to scraps there, since doing so will invite more scraps, which I don’t want. I haven’t deleted my account since I’m told that doing so will remove from my GTalk friends list those people who’ve been added because of Orkut.

Speaking to other people, I find similar stories. Most people have either deleted their orkut accounts, or just let them go dormant. Of course this doesn’t include people who occasionally scrap me over there. Oh, and btw, most people are still around on facebook. I  know one guy (POTA) who deleted his facebook account but apart from that, most people are still around. So what exactly went wrong with orkut?

1. Fransips: Orkut allowed you to send messages/scraps to whoever you wanted to, irrespective of whether they knew you or not. In the initial stage, when people were rediscovering themselves and their networks, this was a fantastic facility. But once that got completed, it was used by random fransip-seekers, which drove most women away from orkut. And once the women went away, the “good guys” followed them out.

2. Random names: Orkut allowed people to change their display names very easily, and this turned out to be a huge problem. Some day, you’d get a scrap from someone with first name “going to” and second name “california” (with lots of periods and exclamations punctuating the name) and it would take a huge effort to figure out who had messaged you. It is easy dealing with standard nicknames but when people start naming themselves after something that doesn’t make any sense, and hten proceed to change their names every few days, it does get disconcerting.

3. There was nothing to do: Once the initial network-rediscovering face was done, there was nothing one could “do” on orkut. Yeah, about a year back they introduced the concept of applications and stuff, but that was more in response to facebook after the latter had drawn away most of Orkut’s users. Orkut allowed you to write scraps on friends. It allowed you to write rediff-level comments on discussion boards. It allowed you to find random women and seek franship. But that was that. Nothing to do on a sustainable basis.

4.Lack of privacy There was absolutely no privacy on orkut. Everyone could see what you did, who you talked to, what photos you put, where you had been, and in essesnce your entire life history. This, combined with the fransip seekers meant that people “shut down” on orkut. Away went the interesting pictures. Scraps would get deleted. Everyone suddenly became “committed”. People basically started lying, and hiding information. There was no way a forum that encouraged this could help sustain “keeping in touch”.

5. Spam Orkut stupidly allowed some stupid scripts to be run, and so on new year’s day 2008, i had a hundred messages on my scrapbook, all of them having been generated by some stupid script. Orkut had ceased to be personal. You could write a script which would write “hello world” on all your friends’ scrapbooks.

Once the balance had tipped towards facebook, there was no looking back towards Orkut. Orkut tried some themes, which ended up making people’s pages very gaudy indeed. The photo tagging tool was added, but navigation was tough. They tried to introduce a friend feed, but most of the feed was taken up by random thrid party apps. Over the course of the last one year, orkut has kept getting progressively worse.

If you look at it, some of hte features of orkut that enabled it to fail recently were what made it so popular in the early days (2004-07). In that golden age for orkut, people were busy reconnecting. Finding lost friends and relatives. You would crawl through entire friends’ lists in order to find that special friend who you had lost touch with. And you found dozens of them every day. It was incredible. People who you hardly talked to in school suddenly became close “orkut friends”. New relationships were built. New bonds were made. And then you realized that you had gotten back in touch with practically everyone you’ve known. Orkut was of no use to you any more.

I think there is a business school case study waiting to be written over here – about what made and broke Orkut. And it can be used in that session in corporate strategy class where they teach that your greatest strengths can turn into your greatest weaknesses.

Discrete and continuous jobs

Earlier today, while contributing to a spectacular discussion about ambition on a mailing list that I’m part of, I realized that my CV basically translates to spectacular performance in entrance exams and certain other competitive exams, and not much otherwise. This made me think of the concept of a “discrete job” – where you are evaluated based on work that you do at certain discrete points in time, as opposed to a continuous job where you are evaluated based on all the work that you do all the time.

A good example of a discrete job is that of a sportsman. Yes, a sportsman needs to work hard all the time and train well and all that, but the point is that his performance is essentially evaluated based on his performance on the day of the game. His performance on these “big days” matter significantly more than his performance on non-match days. So you can have people like Ledley King who are unable to train (because of weak knees) but are still highly valued because they can play a damn good game when it matters.

In fact any performing artist does a “discrete” job. If you are an actor, you need to do well on the day of your play, and off-days during non-performing days can be easily forgiven. Similarly for a musician and so forth.

Now the advantage of a “discrete” job is that you can conserve your energies for the big occasion. You can afford the occasional slip-up during non-performing days but as long as you do a good job on the performing days you are fine. On the other hand, if you are in a continuous job, off-days cost so much more, and you will need to divide your energies across each day.

If you are of the types that builds up a frenzy and thulps for short period of time and then goes back to “sleep” (I think I fall under this category), doing a continuous job is extremely difficult. The only way that it can be managed is through aggregation – never giving close deadlines so that you can compensate for the off-day by having a high-work day somewhere close to it. But not every job allows you the luxury of aggregation, so problem are there.

Now, my challenge is to find a discrete job in the kind of stuff that I want to do (broadly quant analysis). And maybe give that a shot. So far I’ve been mostly involved in continuous jobs, and am clearly not doing very well in that. And given my track record in important examinaitons, it is likely I’ll do better in a discrete job. Now to find one of those..

Betting as a hedge

Today’s Business Standard reports that ESPNStar and their advertisers stand to lose significantly following India’s early exit from the T20 World Cup. However, the situation now is significantly better off than in the 2007 World Cup where India didn’t even enter the super8. Back then, India had played a grand total of 3 matches out of a maximum possible 11 before they got knocked out. And thanks to India’s exit, interest in the rest of the tournament had also waned, leading to significant losses for SETMax, etc.

The situation this time round is significantly better than the last time – since India has gone out only after the second stage. Given that after today’s games the only games are the semis and the finals, I don’t expect the channel and the advertisers to lose as much.

Nevertheless, my mind goes back to a post that I had written back when India went out of the 2007 World Cup following its loss to Bangladesh. I had suggested the following as an “immoral solution”.

It is clear that Ireland is in the super eight, so nothing can be done about that. However, there is still a ray of hope in group B (india?s group). I know it is illegal, but wouldn?t it make sense for a consortium of say SET, Tata SKY, LG and maybe tourism departments of West Indian governments to offer money to Bangladesh and ask them to lose to Bermuda? ?you have done a fantastic job so far in the world cup. You?ve beaten India. Must be a very proud moment for your country. Can you please take this money now and leave, so that the rest of the world cup can go on? We would be better off without you!?

However, the chance to implement the immoral solution is past us this time around. So let me come to the “one legal solution” that I’d suggested:

By buying broadcast rights for a major tournament such as a world cup, you are unwittingly betting on the results of a few matches. Betting that the country where you’ll broadcast will do well. Betting that there aren’t too many major upsets. Betting that results will follow a certain pattern. You know you can’t affect the results, so the next best thing is to hedge!

Go to Ladbrokes, and take the opposite position. Bet, and bet well so as to limit your losses in case some results don’t go according to plan. Maybe you’re not very good at betting, and after all it?s not your core competence. Not to worry. I’m sure some good investment banker would come up with a product with returns linked to the results of a few matches. He will provide you a product with which all the implicit bets you’ve taken will be hedged. And he will go to Ladbrokes and hedge his position by taking positions there. And charge you a small premium for it. Beautiful, isn’t it?

Betting on sport is not a purely speculative activity. Of course there are a lot of people who speculate on sports, but these people also speculate by buying and selling stocks and bonds. Betting can also be an extremely useful hedging tool. If only it were to be made legal in India, I’m sure a lot of our corporates will end up being better off. And typically taxes on betting are high, and so the government will also have its share.

Can someone please convince the people in the finance ministry, or whatever is the concerned ministry, about this, and to legalize betting? I’m sure there is significant value to be unlocked.