Jobs and courtship

Jobs, unlike romantic relationships, don’t come with a courtship period. You basically go for a bunch of interviews and at the end of it both parties (you and the employer) have to decide whether it is going to be a good fit. Neither party has complete information – you don’t know what a typical day at the job is like, and your employer doesn’t know much about your working style. And so both of you are taking a risk. And there is a significant probability that you are actually a misfit and the “relationship” can go bad.

For the company it doesn’t matter so much if the odd job goes bad. They’ll usually have their recruitment algorithm such that the probability of a misfit employee is so low it won’t affect their attrition numbers. From the point of view of the employees, though, it can get tough. Every misfit you go through has to be explained at the next interview. You have a lot of misfits, and you’re deemed to be an unfaithful guy (like being called a “much-married man”). And makes it so tough for you to get another job that you are more likely to stumble into one where you’re a misfit once again!

Unfortunately, it is not practical for companies to hire interns. I mean, it is a successful recruitment strategy at the college-students level but not too many people are willing to get into the uncertainty of a non-going-concern job in the middle of their careers. This risk-aversion means that a lot of people have no option but to soldier on despite being gross misfits.

And then there are those that keep “divorcing” in an attempt to fit in, until they are deemed unemployable.

PS: In this regard, recruitments are like arranged marriage. You make a decision based on a handful of interviews in simulated conditions without actually getting to know each other. And speaking of arranged marriage, I reprise this post of mine from six years ago.

S&P’s Responsibilities

Reading through some of the reactions from “experts” to the S&P’s downgrade of US debt, I see words such as “irresponsible”, “misguided” and “inappropriate” being bandied around. These experts seem to be of the view that in view of all that the US is already going through (given the debt crisis et al) it was not correct for the S&P to push it further down into the abyss by downgrading its debt.

Now, the S&P is a rating agency. Its job is to rate debt, categorizing it in terms of how likely an issuer is to honour the debt it issues. It is a privately held firm and it is not the job of the S&P to prevent global crises and save the world. In this case, the S&P has just done its job. And having been following the crisis for a while I’m of the opinion that it’s done the right thing (check Felix Salmon’s article on this; he says the downgrade is more due to the risk of the US’s willingness to not default, rather than its ability; given that there is no permanent solution yet to the debt ceiling and it issues all debt in its native currency).

If a simple move like this by a private company is going to bring down the world, it is because of screwed up regulations (read Basel 2 and Basel 3) that ended up giving way too much importance to firms such as this. And I’m sure the US had adequate representation at that meeting in Basel where the accord was adopted, so it can be partially held responsible for the enormous power that rating agencies currently wield.

The bottom line is that excessive regulations based on dodgy parameters have been responsible for a lot of the mess that we see today. #thatzwhy we need strong regulations.

Ratings and Regulations

So the S&P has finally bitten the bullet and downgraded US federal debt to AA+ from its forever rating as AAA. While this signals that according to the S&P US Treasuries are no longer the least-risky investments, what surprises me is the reaction of the markets.

So far, since the rating change was announced after US market hours on Friday evening, only one stock exchange has traded – the one in Saudi Arabia, and that has lost about 5%. While it can be argued that it is an extension of severe drops in the markets elsewhere in the second half of last week, at least a part of the drop can be explained by the US debt downgrade. Now, when markets elsewhere open tomorrow after the weekend, we can expect a similar bloodbath, with the biggest drop to be expected in the US markets.

Now, the whole purpose of ratings was supposed to be a quick indicator to lenders about credit risk of lending to a particular entity, and help them with marking up their loan rates appropriately. It was basically outsourcing and centralization of the creditworthiness process, so that each lender need not do the whole due diligence himself. You can argue in favour of ratings as a logical extension of Division of Labour. If lending is akin to making shoes, you can think of rating agencies analogous to leather tanners, to save each shoe maker the job of tanning the leather himself.

However, over the course of time, there have been two consequences. The first was dealt with sufficiently during the global crisis of 2008. That it is the debt issuer who pays for the ratings. It clearly points out to an agency problem, especially when the “debt issuers” were dodgy SPVs set up to create CDOs. The second is about ratings being brought into the regulatory ambit. The biggest culprit, if I’ve done my homework right, in this regard was the much-acclaimed Basel II norms for capital requirements in banking, which tied up capital requirements to the ratings of the loans that the banks had given out. This had disastrous consequences with respect to the mortgage crisis, but I’ll not touch upon that here.

What this rating-based regulation has done is to take away the wisdom of crowds in pricing the debt issued by a particular issuer. Normally, the way stock and bond prices work is by way of wisdom of crowds, since they represent the aggregate information possessed by all market participants. Different participants have different assumptions, and at each instant (or tick), they all come together in the form of one “market clearing price”.

In the absence of ratings, the cost of debt would be decided by the markets, with (figuratively) each participant doing his own analysis on the issuer’s creditworthiness and then deciding upon an interest yield that he is willing to accept to lend out to this issuer. Now, however, with ratings linked to capital requirements, the equation completely changes. If the rating of the debt increases, for the same amount of capital, the cap on the amount the banker can lend to this particular issuer jumps. And that means he is willing to accept a lower yield on the debt itself (think about it in terms of leverage).

Whereas in the absence of ratings, the full information known to all market participants would go into the price of debt, the presence of ratings and their role in regulation prevents all this information flowing out to the market in terms of the price of debt. And thus the actual health of the issuer cannot be logically determined by its bond price alone – which is a measure that is continuously updated (every tick, as we say it). And that prevents free flow of information, which results in gross mispricing, and large losses when mistakes are discovered.

I don’t have anything against ratings per se. I think they are a good mechanism for a lay investor to get an estimate of  the credit risk of lending to a particular issuer. What has made ratings dangerous, though, is its link to banking regulation. The sooner that gets dismantled the better it is to prevent future crises.

Working for money

One of these days during lunch at office, we had a fairly heated discussion about why people work. One guy and I were of the opinion that the primary reason people work is for money, and everything else is secondary. The third guy, who among the three of us perhaps works the hardest, argued that “people who make a difference” never work for money, and that it is only “ordinary people”, who have no desire to “make a difference” that work for money. He took the examples of people like Steve Jobs and a few famous scientists to make his point.

Now, while I agree that money is the primary reason I work, and which is what I argued that day during lunch, I disagree that the end-of-month salary credit tells the whole story. The way I see it, you need to take a longer-term view of things. So while the short-term money you make is important, and affects important decisions such as quality of short-term life, a more important thing is sustainable returns. While you do your work and get that end-of-month salary credit to bolster your bank account, an important thing is about how much the work you’re doing now will contribute to your income later on in life.

Digression 1: I keep oscillating between wanting to retire at forty and wanting to retire at sixty. And I must admit I haven’t frankly decided which one is more suitable for me. This analysis is more relevant with the retirement at sixty model (which is what I think I’ll end up following, health etc permitting). End of Digression 1.

Digression 2: Not so long ago, some people in my firm wanted to recruit “software engineers from IIT with two to three years of work experience”. Being one of the “CS guys” around, I interviewed quite a few people for that role. Their CVs indicated that had we “caught them” on campus, they would have been sure hires. But two years at a software services shop, I figured in all cases, had made them “rusty”. Spending all their time in mind-numbing activities (like building UIs), they had failed to build on the skills that would have been useful for the higher-up-the-value-chain job I was recruiting for (finally that team went to IITs and got a bunch of campus hires. They gave up on lateral hiring altogether). End of Digression 2.

Those two digressions weren’t particularly meaningless. I guess you know where this post is headed now. So, the thing with a job is that along with the short-term benefits it provides, it should also help you build on those skills that you think you can monetize later on in life. Every job (most jobs, really) teach you something. There is constant learning everywhere. But what matters is if the learning that the job offers is aligned with the kind of learning that you think you are geared for, which you think you can monetize at a later point of time in life.

I still claim that I work for money, but just that I take a longer-term view of it. And I strive to learn those things on a job which I think will be helpful for me in terms of monetization at a later point of time in my life.

 

Two kinds of immigration

There are fundamentally two kinds of immigration – local job-creators and local job-competitors. The former are primarily middle and upper middle class people, who create jobs locally in terms of employing people (directly) to provide services for them – like maids, cooks, drivers, laundrymen, etc. The latter are primarily working class people who migrate in order to provide local services. They work as maids, cooks, drivers, etc.

Already existing local service providers welcome the immigration of job-creators. That means they now have the opportunity to push up their asking prices, since there is now more competition for their services. There is little economic opposition to the immigration of job-creators. The opposition to them is usually cultural – witness the rants of middle class “native” Bangaloreans like me against “koramangala people”.

Job-competitors, on the other hand are not so welcome. While they usually don’t contribute too much to the “culture” of the city, they compete directly economically against already existing local service providers. There is a clear economic rationale for local service providers to oppose the entry of more such providers, and since the local service providers are usually numerous and politically active, it is easier to oppose the entry of such job-competitors.

In the 1960s, for example, Shiv Sena started out by targeting South Indian middle class people. However, that campaign didn’t last long, since the “masses” (mostly local service providers) realized that it was economically counterintuitive for them to target middle class people. Hence, gradually over time, the rhetoric changed and the targets are now immigrant job-competitors. So you have Shiv Sena guys beating up Bihari taxi drivers, etc. And since this targeting of immigrant job-competitors is economically advantageous to the “masses”, it is likely to be more sustainable than the targeting of immigrant middle class people.

Data Science and Software Engineering

I’m a data scientist. I’m good with numbers, and handling large and medium sized data sets (that doesn’t mean I’m bad at handling small data sets, of course). The work-related thing that gives me most kicks is to take a bunch of data and through a process of simple analysis, extract information out of it. To twist and turn the data, or to use management jargon “slice and dice”, and see things that aren’t visible to too many people. To formulate hypotheses, and use data to prove or disprove them. To represent data in simple but intuitive formats (i.e. graphs) so as to convey the information I want to convey.

I can count my last three jobs (including my current one) as being results of my quest to become better at data science and modeling. Unfortunately, none of these jobs have turned out particularly well (this includes my current one). The problem has been that in all these jobs, data science has been tightly coupled with software engineering, and I suck at software engineering.

Let me stop for a moment and tell you that I don’t mind programming. In fact, I love programming. I love writing code that makes my job easier, and automates things, and gives me data in formats that I desire. But I hate software engineering. Of writing code within a particular system, or framework. Or adhering to standards that someone else sets for “good code”. Of following processes and making my code usable by some dumbfuck somewhere else who wouldn’t get it if I wrote it the way I wanted. As I’d mentioned earlier, I like coding for myself. I don’t like coding for someone else. And so I suck at software engineering.

Now I wonder if it’s possible at all to decouple data science from software engineering. My instinct tells me that it should be possible. That I need not write production-level code in order to turn my data-based insights into commercially viable form. Unfortunately, in my search around the corporatosphere thus far, I haven’t been able to find something of the sort.

Which makes me wonder if I should create my own niche, rather than hoping for someone else to create it for me.

End of month blues

One of the problems with running your blog on your own website is that you need to manage bandwidth. Basically it seems like my blog has been run over by bots and so by the 25th of every month the bandwidth for the month is over, and the blog goes down for the rest of the month. I’ve been trying to do a lot of things to prevent this – blocking suspicious looking IPs, installing bad behaviour, and such like, but still I don’t know why it gets locked out.

My biggest problem with this end of month lockout is the volume of ideas that go down the drain during this time, rather than getting published on the blog. I wish I could try and remember all those blogging ideas and do one mega blog post at least with a summary of all of them, so that I could write about them at some point of time in the future, but it seems like I can’t remember anything now.

In other news, I’ve been getting really stressed out of late, and my mental bandwidth has been at an all time low. I’ve felt that I’ve been going downhill since my trip to New York a few months back, but of late it’s gotten really bad, and I’m just not able to do anything. That’s yet another reason why blogging frequency has dipped in the last couple of weeks or so.

Doing a deep dive into my own past, I think I’ve figured out why this has been happening. Rather, I have a hypothesis about why I’ve been stressing myself out too much at work which has led to this situation. Basically it’s down to studs and fighters.

I traditionally have what I call as a “stud” working style. I work in bursts, at reasonably low intensity. I look at the problem as a series of steps, and for each step, I internalize the problem, and then try to de-focus. And while thinking about something else, or reading something, or writing something else, I end up having a solution to the problem, and then I take a little break and move on to the next step. This is essentially how I’ve worked over the last few years and I think I’ve (to myself at least) done a good job using this method.

There’s yet another method that I’ve frequently used in the past, one that I call the Ganesha method. It’s basically used for tasks I want to get  done with ASAP. I work at it at a very high intensity, shutting myself off from everything else in the world. I work at it continuously without a break, and then take a long break once the solution is done. I’ve used it in the past for things like competitive exams where I think I’ve done rather well.

So the mistake I did a while back (maybe a year or so back) was to try and use this latter method over longer periods of time, for longer problems. The thing with this method is that it’s suited for short problems, which can be finished off in a burst with a little bit of stretching myself. But when applied to significantly larger problems, I’ve found that it’s been stressing me out way too much. By trying to be steady and focused over a long period of time, which is how a fighter traditionally works, I think I’ve mentally destroyed myself.

Moral of the story is that whatever happens you need to be yourself, and do things in your own style. Don’t try to change yourself in order to please others. It is simply not sustainable.

Vishnu and Shiva temples

This post may add to Aadisht’s contention of Shaivism being superior to Vaishnavism. Earlier this month I’d gone with family to this place called Avani, some 100 km east of Bangalore. The main centre of attraction there was this 10th century Shiva temple that had been built by the Gangas.

As we got off the car, I was pleased to see the signage of the Archaeological Society of India. I’m in general not a big fan of temples. I find them to be overwhelmed with “devotees”, and way too noisy, and more importantly for some reason I’m not allowed to use my camera inside temples. So I was pleased that this being an ASI temple there won’t be any worship in there and so I can take pictures peacefully.

As we entered, though, I saw a number of priestly figures standing around the entrance, and one of them shouted “no photo in temple, no photo in temple” (i was in bermudas and a t-shirt, and wearing a backpack and camera bag so looked foreign types). I just nodded and went on. And then another priest accompanied us, and performed the pooja to the idol.

The temple at Avani is that of Ramalingeshwara, a version of Shiva. Now, the studness with Shiva temples is that the idol is extremely simple. It’s just a penis. And it’s not hard to make, and more importantly it’s hard to break, since it’s monolithic, and usually without any portions that can easily break off. Contrast this with Vishnu temples, where the idols are of actual human figures, with arms and legs and ears and noses and fingers – all made of relatively thin pieces of stone, which makes it easier to break.

So think of yourself as an invader who for some reason wants to defile a temple by destroying its idols. The very nature of idols in a Vishnu temple makes your job simple. All you need is to give one strong hit which will break off a nose or a toe or a finger – not much damage, but enough to defile the temple and render it useless for the purpose of worship. But get to a Shiva temple, and you see one large penis-shaped stone in there, and you realize it’s not worth your patience to try break it down. So you just loot the vaults and go your way.

And hence, due to the nature of the idols in these temples, Shiva temples are more resilient to invasion and natural disaster compared to Vishnu temples. Aadisht, you can be happy.

Between Suits and Geeks

So you have suits and you have geeks. The problem with me is that I’m neither. I lie somewhere in between. So when I’m in the company of suits, I look like a geek, and in the company of geeks I look like a suit.

Problem is that suits don’t understand geeky stuff, or tend to get intimidated, or expect me to do magic. Geeks are usually dismissive of suity stuff, saying it’s all “globe” or “pfaff”. They think they are the masters of the universe and suits are dumb.

So. Suits to the left of me, and geeks to my right. Here I am, stuck in the middle with you

Why You Should Not Do An Undergrad in Computer Science at IIT Madras

I did my undergrad in Computer Science and Engineering at IIT Madras. My parents wanted me to study Electrical Engineering, but I had liked programming back in school, and my JEE rank “normally” “implied” Computer Science and Engineering. So I just went with the flow and joined the course. In the short term, I liked some subjects, so I was happy with my decision. Moreover there was a certain aura associated with CS students back in IITM, and I was happy to be a part of it. In the medium term too, the computer science degree did open doors to a few jobs, and I’m happy for that. And I still didn’t regret my decision.

Now, a full seven years after I graduated with my Bachelors, I’m not so sure. I think I should’ve gone for a “lighter” course, but then no one told me. So the thing with a B.Tech. in Computer Science and Engineering at IIT Madras is that it is extremely assignment incentive. Computer Science is that kind of a subject, there is very little you can learn in the classroom. The best way to learn stuff is by actually doing stuff, and “lab” is cheap (all you need is a bunch of computers) so most courses are filled with assignments. Probably from the fourth semester onwards, you spend most of your time doing assignments. Yes, you do end up getting good grades on an average, but you would’ve worked for it. And there’s no choice.

The thing with an Undergrad is that you are clueless. You have no clue what you’re interested in, what kind of a career you want to pursue, what excites you and the stuff. Yes, you have some information from school, from talking to seniors and stuff, but still it’s very difficult to KNOW when you are seventeen as to what you want to do in life. From this perspective, it is important for your to keep your options as open as they can be.

Unfortunately most universities in India don’t allow you to switch streams midway through your undergrad (most colleges are siloed into “arts” or “engineering” or “medicine” and the like). IIT Madras, in fact, is better in that respect since it allows you to choose a “minor” stream of study and courses in pure sciences and the humanities. But still, it is impossible for you to change your stream midway. So how do you signal to the market that you are actually interested in something else?

One way is by doing projects in areas that you think you are really interested in. Projects serve two purposes – first they allow you to do real work in the chosen field, and find out for yourself if it interests you. And if it does interest you, you have an automatic resume bullet point to pursue your career on that axis. Course-related projects are fine but since they’re forced, you have no way out, and they will be especially unpleasant if you happen to not like the course.

So why is CS@IITM a problem? Because it is so hectic, it doesn’t give you the time to pursue your other interests. It doesn’t offer you the kind of time that you need to study and take on projects in other subjects (yeah, it still offers you the 3 + 1 months of vacation per year, when you can do whatever you want, but then in the latter stages you’re so occupied with internships and course projects you’re better off having time during the term). So if you, like me, find out midway through the course that you would rather do something else, there is that much less time for you to explore around, study, and do projects in other subjects.

And there is no downside to joining a less hectic course. How hectic a course inherently is only sets a baseline. If you were to like the course, no one stops you from doing additional projects in the same subject. That way you get to do more of what you like, and get additional bullet points. All for the good, right?

After I graduated, IIT Madras reduced its credit requirement by one-twelfth. I don’t know how effective that has been in reducing the inherent workload of students but it’s a step in the right direction. Nevertheless, if you are going to get into college now, make sure you get into a less hectic course so that the cost of making a mistake in selection is not high.