DCBA (Desi Confused by America)

Recession Time

2010-06-06T14:42:00.000-07:00

Job Search under Obama's Policy :)

Iran - All (Nu)Clear

2010-05-27T09:40:00.000-07:00

With the recently announced deal with Turkey, Iran just outmaneuvered the US, not to mention the UN and everyone else who has been calling for more tough actions. Iran has agreed to ship 1,200 kg of low-enriched uranium (LEU) to Turkey, where it would be held. In exchange, it is entitled to 120 kg of uranium enriched to 20 percent to use in a Tehran medical research reactor that produces isotopes for cancer treatment. It is interesting that Iran rejected a similar deal in October where it was to ship 1200 kg of LEU - about 70% of stock pile at that time, but now after 6 months, Iran has continued processing and has accumulated double that quantity. It is now ready to ship out the 1200 kg, which would still allow it to keep roughly half the uranium at home...just in case. Granted the deal has many escape clauses, but at this point, the world does not have any choices.

Like it or not, Turkey and Brazil have succeeded where the five permanent members of the UN Security Council had failed. But instead of applauding the deal, the US and EU are pushing towards a fourth U.N. Security Council sanctions resolution against Iran's nuclear weapons program. Iran has already proved to the world that the sanctions will not stop its progress and has sent a strong message that, in fact every time sanctions are passed, it will speed up enrichment. Even as the sanctions creak along, at this point, it amounts to pretty much just going through the motion. Russia and China are looking for any excuse to jump off the wagon and protect their interests in Iran. They have already rejected key proposals in stopping Iran's access to international financial markets and continue to arm it with weapons. The GCC too have come together to support Iran's show of goodwill in accepting this deal and the push for sanctions this time around looks like it will clearly not have any impact.

Any effort to dealing with Iran's nuclear capability will have to include realistic expectations. Expecting Iran to give up control of its full LEU capacity is not plausible, especially when the nuclear program enjoys the support of at large part of the Iranian population. Any plan should include small steps of confidence building and Instead of threatening Iran the United States and Europe should welcome initiatives which aim to establish a platform for engagement. But with the US and EU always pushing Iran's back against the wall, Iran is left with very little options other than to continue pursuing nuclear technology. Before criticizing Iran, let’s be clear that what Iran is doing is perfectly legal within the UN framework. Iran is a signatory to the NPT and has the rights to pursue nuclear technology for civilian energy programs. Fact is, Iran has made several compromise offers in the last few years that would address any REAL concern about weapons proliferation. Iran has offered to open its nuclear program to US participation, and to sign the Additional Protocol which allows more intensive IAEA inspections (no other nuclear country has done all that) and yet the US and the West consistently ignore Iran's compromise offers and insist on an unachievable goal of "zero enrichment in Iran" which is a disregard of Iran's sovereign rights as recognized by the NPT.

The reality is that there are only two options: Iran gets nuclear weapons, or someone uses pre-emptive military force to break Iran's nuclear fuel cycle and paralyze its program, at least temporarily. There is no possibility the US will use force, despite its confused and ever-changing policy right from Bush to Obama about the military option always being "on the table." That leaves Israel attacking Iran the only option which will make it vulnerable to potential retaliation and legitimize full blown attacks from Hezbollah, Hamas, Al Qaeda and Iran. To be honest, Israel also does not look all that strong since it could not even make a dent to Hamas after it attacked it for weeks last time. In fact Hamas and Hezbollah came out stronger after they were able to withstand the full might of the Israeli army. This is one reason why even Obama has refused to be a part of any Israeli plans to attack Iran since he understands the myth of Israeli army's strength in the Arab world was put to bed when Israel went to war with Hezbollah in 2006.

Its time to wake up folks... The US, Israel and the world have to prepare to deal with a nuclear Iran. Every western country says they will do all they can to prevent this, but given the current political realities in the US, Middle East and EU, it is time for everyone to brace reality and start formulating strategies on how to deal with Iran once it goes nuclear. At this point the only thing the US and EU can do is provide security assurances to neighboring countries and promises of retaliation if Iran uses its nuclear weapons first. The simple fact of Iran possessing nuclear weapons would alone dramatically alter the Middle East balance of power. Iran does not actually have to use its capabilities to prove anything. North Korea is case and point where they torpedoed and sank the South Korean Navy ship, and Kim Jong Il has directed North Korea’s military and civilian population to prepare for war, and the only thing the US and world can do is stand by and deem the behavior "Odd".

Ultimately, the west has to understand that you cannot get a foreign country to do exactly what you want unless you can exert sufficient military or economic force to compel them. In the case of Iran, no country has that level of economic force and the disadvantages of military action far outweigh the advantages. George Bush understood this, Obama understands it and so, unfortunately, do the Iranians. That is why the world is dancing around the issue of Iran's nuclear program for years without anyone being able to take any kind of action. On the other hand, Iran is still merrily enriching uranium at levels that are approaching weapons-grade, and it isn't likely to stop anytime soon. No one should base their future plans on anything except dealing with a nuclear Iran.

Speculating Fear

2010-05-11T15:16:00.000-07:00

There are all sorts of reasons over what caused the crash last week, but real question is how can the market go, on a random Thursday afternoon, completely insane? Everyone is looking for someone to blame. But what made the crash on May 6th so absolutely shocking is the market dropped close to 1000 points in a few minutes… I mean in a few MINUTES!!!! Between 2 p.m. and 3 p.m. the Dow lost over 900 points before dramatically bouncing back about 600 points.

One thing is for sure, as the trading volume soared, data systems across the stock market began to get clogged. By 2:37 p.m., the overload seemed to have taken its toll on the NYSE's ARCA electronic-trading system. The bid/ask prices got out of control and the price of stocks were going insane. Accenture went from trading at around 40 dollars a share all the way down to one cent before bouncing back. Nasdaq detected what it felt was questionable information in the data and sent out a message saying it would no longer route quotes to ARCA. This step—known as declaring "self-help"—doesn't happen often among the major exchanges. By evening however, all exchanges in a rare coordinated manner put out a statement saying "All trades executed between 2:40 PM and 3:00 PM that increased more than 60% or decreased more than 60% away from the consolidated last print in that security at 2:40 or immediately prior" will be cancelled." Obviously this decision will not be open to appeal but while Nasdaq and others canceled trades on more than 200 largely NYSE-listed companies whose shares fell or rose more than 60 percent, investors unlucky enough to have sold depressed shares of other companies that fell less have little recourse and those who made money by buying at the bottom and made less than 60% can rejoice at others expense. Exchanges have never been blamed for losses, but my guess is this will be tested in courts this time around.

So far, a lot of people have been blamed. But even after a couple of days, there is no real rational explanation as to what went really wrong and caused the drop. There are theories, but no real answers yet!!

So what are the theories circling around?

Fat Finger Issue - It has been widely suggested that a "fat finger trade" was responsible for triggering the panic. A trader entered a "b" for billion instead of an "m" for million in a trade involving Procter & Gamble. No confirmation yet but after a few days, this explanation possibly looks untrue
Computer Glitch - There were many erroneous trades due to bad pricing, but the systems of course do not know that and did one thing lead to another and the systems get out of control?? Anybody’s guess at this point
Stop Orders - There were 1000's of stop orders which got triggered due to the market breaking certain levels. Did a series of stop loss orders trigger a downward spiral maybe?
European Debt Crisis - Greece definitely contributed to markets going down, but it is unlikely to be the sole cause that led to the all out assault on the markets
Just plain Fear and Panic - There is also the possibility that this was a real financial panic. There are huge concerns about what is going on in general with the debt levels and the currency markets are fluctuating wildly. The Dow was already down several hundred points even before the massive plunge took place. The reality is that there is a lot of fear in the financial markets right now. But if it was a real panic, then why did the Dow bounce back so quickly?
HTF - More than 60% of today’s trading is done electronically, so could High Frequency trading have been the cause for what happened? But if it was just high-frequency traders bailing out, why wouldn't [that drop] happen on every stock? It just doesn't add up.
Hacking - Implausible without proof, but possible. It does sound farfetched, but hey, till now the exchanges have never been held responsible for the losses. So did someone hack into NYSE and purposefully create this mayhem not to mention walking away will a ton of money and a big smile as others are scrambling around to understand what went on.

As more details of last Thursday's collapse become clear, the picture is one of a highly rare confluence of events, some linked, some unrelated, that exposed weaknesses in the stock market large and small. But the only interesting thing here is the catalyst that stopped the fall. Whatever caused the market to crash stopped after a point which led to the reversal. So what was the catalyst?? I doubt anyone can really get to the bottom of this for a long time to come.

Blagojevich - Governor Goofball

2010-04-23T14:40:00.000-07:00

Okay, here's what caught my eye during season 3 of Celebrity Apprentice - Guv Blago. He just completely cracked me up! If Blago hoped to reform his criminal image by appearing on Celebrity Apprentice, it did not exactly work out that way. Reality TV is all about entertainment and Rod Blagojevich may just be the biggest buffoon in reality TV history. He just walked around as clueless as clueless can be with his goofy grin on. Ignorance must truly be bliss because this guy seemingly has no skills whatsoever and is caught up in a huge political scandal, yet walks around like he just ate up a huge bowl of sunshine. What surprised me is how Trump constantly promoted him and kept complementing him at every opportunity he got about how tough the Gov is. I wonder what the voters of Illinois — especially the ones that voted for him — think when they see how incompetent he is.

But I absolutely do not hate on Blago. Because all I want on a Sunday night from TV is to be entertained and as far as that goes, oh boy, he was the most entertaining person I have seen in years. And after watching the last few episodes without Blago, I am definitely not getting much laughs anymore on Sunday night. And in the defense of Blago as a goofball and reality TV superstar, I would like to present the following exhibits into evidence:

Exhibit A: I was honestly shocked at his Computer Skills. I don't know what was more awesome, the fact that he did not know how to turn on a computer, did not know how to put a DVD into a computer, knew nothing about email or the fact that it took him 30 minutes to type a few lines in word.

Exhibit B: What stunned me even more was he did not even know how to use a cell phone with speaker turned on. I almost fell off my chair laughing when his team mates were speaking on one end and the Guv was staring at the phone like it was a brick. I mean is he for real? To top it all, he openly asked what is a text message and admitted he did not know how to text and then fell asleep. Certainly a golden moment in reality TV history.

Exhibit C: The ability to turn any conversation into how he Was a fantastic governor. This guy never lets up! And why should he when he yields such unintentionally humorous results? In a matter of seconds — seconds! — He always goes from discussing the task to a list of all his amazing accomplishments as the Gov: Healthcare for children! Preschool for all! No raising taxes! Health care for seniors! The guy is a walking campaign ad. And yet I simply cannot get enough of him.

Exhibit D: My favorite quote "We're prematurely ejaculating. We need more foreplay". My second favorite quote was when it was revealed he would be getting on a plane “I don’t need a passport do I.” (Did he think he was getting a vacation in the Maldives? and then he got on the plane and went to sleep :) and finally on cooking for the celebrity-run diner challenge: "I didn't cook at all when I was governor. I was cooking up results for people."

Exhibit E: Every time Trump asks him who should be fired in his opinion, I am constantly amazed at how he keeps talking for 10 minutes and keeps beating around the bush and never actually answered the question. Guess this is the number one pre-requisite for politicians and he just proved it over and over again.

Exhibit F: The constant hand shaking. Looks like life for him is clearly one long campaign trail. Doesn’t matter if people recoil in horror or start yelling at him about how he should go to prison — he still wants to work the crowd. And I loved the way he viewed New York as one big vote base. It takes him approximately three hours to walk a single block as he goes and aggressively searches out everyone to say hi and kept swearing at his innocence. In television history, I have never seen anyone work a room, street, alley, elevator or storefront like our Blago did.

What else can I say.. When he was on the show, the celebrity apprentice was certainly entertainment at its best. I cannot get over the moments when he just walked around the street of New York and chatted up random people saying "Thank you, I appreciate it. I did nothing wrong" !!!!

Maoism to Terrorism

2010-04-20T04:16:00.000-07:00

Who is a bigger threat to India, the homegrown Maoists or terrorist groups across the border that want to destroy India?? What’s the difference really. It looks like both have the same goal - To destroy peace and create terror within India.

India’s Maoist insurgency has taken on a new face altogether and the evidence is mounting. In one of their boldest attacks yet, at least 350 Maoist guerrillas attacked a convoy and killed 76 armed policemen. This is clearly the worst loss in the four-decade-long conflict. After some digging I found that their roots go back to a 1967 peasant uprising in the West Bengali village of Naxalbari—hence their name, Naxalites—the Maoists have pretty much become a full fledged terrorist organization posing a bigger threat than any other Pak based terror group. They have an estimated 14,000 full-time fighters more than any other terrorist outfit and loosely control pretty much the entire jungle areas of central and eastern India where the state is hardly present. Last year 998 people were killed in Maoist-related conflict. This year could be even bloodier and is sure to surpass that number easily.

India's Maoist rebels also easily top the list of the worst human rights offenders among the myriad of insurgent groups in the country and the Asian Centre for Human Rights, which brought out the report "Torture in India, 2010", also noted the total number of reported torture cases had risen between the years 2000 and 2008 in the country where Maoists torture and kill anyone and everyone they even remotely suspect of providing information on them to the authorities. The govt deployment of an additional 15,000 centrally trained troops to the worst-affected states, taking the total to around 75,000 still seems too late for a vast area home to 450m people, this is still a tiny force. Moreover, properly trained state-level officers, who know the local language and conditions, have a much better counterinsurgency record. The clearest example is in Andhra Pradesh where, through better policing and generous development schemes, the insurgency has recently been greatly weakened.

What is more insulting is that the attack on the police personnel was an emphatic response from the rebels to the central government’s latest offer of peace talks. The Home minister, Palaniappan Chidambaram, nowadays seems to be relaxing at home, while the Maoists loot and extort freely, seems to be in denial (or just weak) in his response and is giving speeches that they are all Indian citizens and force wont be used against them. Well, Mr. Home Minister and the entire Congress govt, while you say all Naxals are Indian Citizens and no army action will be taken to shut them down, with what face is the Indian government talking to Pakistan and asking them to take action against terror groups within POK. Are they are not Pakistani citizens by the same line of reasoning? The whole world is watching and the best India can do is adopt a double standard. How can we expect Pak to take us seriously when our home minister and Air Force chief give public statements that Army won’t use force or undertake Ariel attacks because these terrorists are Indian citizens.

Complacency is partly to blame as until recently few state-level politicians seemed to take the groups threat seriously. Politically, it is a chaos as well. Maoists have their own party (since merging their two main factions in 2004—to form the Communist Party of India -Maoist, under Ganapathi and alarmingly are seen as a party at a national level and they even back many politicians. Even Shibu Soren, chief minister of Maoist-racked Jharkhand, won an election last year with the guerrillas’ support and is predictably reluctant to fight them. This needs to stop and they need to be recognized as a terrorist outfit and any politicians in cahoots with them should be made an example of nationally. It is a shame that we always react to such groups only in the face of some disaster like when LTTE took out our PM or when IA plans was hijacked by LeT Terrorists.

A lot of national tragedies linked to terrorism have hit India in the recent years and the Govt is starting to look very weak when it comes to National security. Wake up Congress and bring out the guns, no need to negotiate with these terrorists and stop pleading with them to put down their arms. Maoist violence and jihadi terrorism are two sides of the same coin and Nationalities should never matter when it comes to dealing with them. If we don’t defend our own country, how can we expect other nations to help us defend ourselves.

Little Maestro

2010-01-23T11:42:00.000-08:00

Hand of God

2009-10-28T16:13:00.001-07:00

5 years to the day...57 today

Wondering how it would have been to have you with us
Wondering how you would have grown older
Wondering how our lives would have changed if you were there
Wondering how happy we would have all been together

Thinking of you

Obama - The Confused Schoolboy

2009-10-28T15:50:00.000-07:00

Obama looks like a badly distracted schoolboy. There are so many things on his "To Do" list and he increasingly looks lost all the time like a school kid who has taken on one too many classes.From healthcare to the public option, from unemployment to the economy, from immigration to the twin wars, from Iran to North Korea, from education to regulatory reforms, from domestic security to global warming and the list goes on and on. One would think that Obama has no time to even sleep tackling all these issues, but you guessed wrong. He even took a day off to go and campaign for Chicago for the Olympics (well, we know how it went by now).

Frankly, Obama is starting to bring back memories of Bush for me. The former president was so distracted that he took off on vacation whenever he had to deal with something (Bush spent 1020 days - 35% of his presidency on vacation). With Obama it’s starting to look the same now. We don’t see him in public often anymore and no one knows what he is up to. It’s going to be a year and the president has literally done nothing except talk or he really has to rethink his communication strategy to the American people.

As a presidential candidate, Obama spoke a good game on resolving the war situation and often referred to Afghanistan as “the forgotten war.” He wasn’t just talking about strategy, though he made it clear in no uncertain terms that he believed the Bush administration had badly mishandled both Iraq and Afghanistan. But now, almost after a year and the war situation is just getting worse. Public anxiety over the war is increasing by the day as the casualty count rises. And what is more dangerous is that the White House’s deliberation in not knowing what to do is playing out against a backdrop of scary pictures of life on the ground there. Looks like things have gotten worse. Where is the change?

Iran and North Korea are freely testing missiles and showcasing their nuclear technology. Heck, Iran even has a second secret nuclear facility and is dangerously coming close to declaring itself as a nuclear power. While Obama has been saying he is open to talking to Iran, they are busy testing missiles and upgrading their military. Looks like things have gotten worse. Where is the change?

Healthcare is becoming another disaster. People are confused, Lobbyists are winning and the democrats seem to be a losing the battle against republicans. Even with a democratic supermajority, it looks doubtful if any meangful and real healthcare "reform" will be passed at all....umm..Where is the change?

Immigration Reform - president said that he expects that after completing work on health care, energy and financial regulation, to draft immigration bills this year. He said plans to get the the measures passed in 2010. While nothing is being done, illegal immigration is on the rise and as strange as it may sound, it is getting more difficult to come here legally.

Educational Reform - A new education reform was announced about 6 months back. Now with all the stimulus money being spent, here we are with nothing to show. He has taken a politically promising stance, by promising to work with teachers, promoting pre-kindergarten education, grants etc.. he has spoken a great game and has clearly avoided any concrete proposals – not exactly a promising sign that real change is coming anywhere soon.

Climate change - during his UN speech Obama said his administration is "determined" to do more to address the nation's climate change obligations. But left out of the speech was the political reality the president faces in trying to keep that promise. While the House passed a sweeping climate change bill this year, it has stalled in the Senate as health care reform dominates the domestic agenda. Powerless to do anything right now, rest assured, no change is coming on this front

I am not even going to mention the ACORN mess and bad publicity Obama has been linked to. The recent videos showing some of ACORNS's workers advising people how to set up a prostitution business is def beating up his image. One up...the voter registration fraud they were accused of last year. Though Obama has no direct involvement, the fact that they are one of his biggest supporters certainly won’t go down well with the people.

What is surprising me is he is putting off making real decisions that may actually have positive impacts. There are so many czars in his administration that no one knows what the other is doing and the public is frankly clueless. He may have a talent for giving soul stirring speeches whenever his ratings fall, but he seems to be all over the place from government meddling in the housing market to the auto industry to the financial markets to the banks to the never ending Fed printing presses, to the educational reform attempts to the bailouts.

Obama needs to GET OUT of the business of business. The government needs to be the referee, not another player... and its time to actually make some changes, especially with the elections coming around next year. If Democrats lose control, forget it, the only change that is going to happen in Washington is Obama going from a president to a lame duck president.

Yoga, Indian v/s Irish Style

2009-09-02T16:50:00.001-07:00

and here is the Irish style........... with no props!!!

Election Time…oops, Its Entertainment Time

2009-04-17T14:13:00.000-07:00

I confess. The more I have been reading about the elections and the news, the more entertained I am. The media is equally to blame too I guess as they have been really sensationalizing the non-stop political drama like crazy. I am actually amazed to see how low Indian politics can actually go.

India is probably at the most crucial juncture with so much uncertainty all over the country which is in the midst of a recessionary cycle affecting the jobs and lives of millions. Just at a time when we really need a strong and honest government, it looks like we are getting ready to vote in the weakest leaders who will provide the worst governance ever after Independence.

Some of the more amusing things that have happened:

Shoe throwing has suddenly become a sport (ask P.Chidamabaram, Jindal and Advani) - India's politicians are now so fearful of shoes being hurled at them that they have asked for more security and are erecting metal nets at rallies.
Candidates declaring their wealth. Some of the candidates has really flabbergasted me (BSP candidate has just declared assets of 600 crores)
Every party leader has to say something on the national news everyday
Varun Gandhi saga – where do I even begin
SP wanting to ban English and computers
Karat who talks against corruption is joining hands with Mayawati and Jayalalitha who are the epitome of corruption in this country
Budiya-Gudiya exchange between Modi and Priyanka
Barrage of filmstars suddenly standing for elections – Does anyone really want Sanjay Dutt or Govinda to be a leader of the country?
PM –Advani exchange – will you guys stop it already
TDP’s free cash and TV schemes

We have only two parties at present in India with an all-India presence - the BJP and the Congress. Suddenly it looks like a 3-way race with a third front emerging. But we already know that the third front has no policy, except to oppose the Congress, BJP and America. History has already taught us a disastrous lesson when he third front came to power at the center the last time. Remember that It was during the third front experiment that we had 4 PMs in 4 years!! To make matters worse (or entertaining.. I don’t know the difference anymore), all of a sudden, there is talk of a fourth front comprising SP, LJP and RJD.
I am not against regional parties. I feel they have a role in our democracy - a regional role. At present, it looks like every regional party wants to be a national party and every regional leader suddenly has become a horse trader. Armed with just 5-6 seats, they are becoming or trying to be the king-makers. Even for getting admission into an ordinary MBA institute, we have debates and group discussions, but sadly when it comes to our leaders, there seems to be absolutely no criteria at all. Anyone and everyone can be a leader in India (criminals are welcome as well)
The only way Indian can build on the momentum it has seen in the last 4-5 years is if and only if a single party is elected with majority at the center. Exactly what will happen when India’s 714 million eligible voters head to the polls in the world’s biggest exercise in democracy is difficult to forecast, this year even more than in the past as it looks like the next government will pretty much be stitched together only after the results are announced. But it is sadder to see every other self proclaimed leader making a mockery of the entire country.

Only in India…Democrazy is FAR the people (before polls), BUY the people (during polls) and OFF the people (after polls).

24 - Simply Superb!!

2009-04-15T19:50:00.000-07:00

What else can I say? After watching 18 episodes of Season 7, I am already ready to give my verdict to Jack Bauer and the rest of the 24 crew even before the season ends. Simply Superb guys!!

This season has been THE season to watch and it has so far outdone all its predecessors easily. Every episode has so many twists and turns with the right mix of action and suspense. The drama has consistently increased every single week and easily keeps you on edge wondering what will happen next. One of the other striking factors this season I loved, different from the previous ones, is that the story has been really built and revolves around the entire cast of 24 and not just Jack. Heck, Jack was even made to sit out a couple of episodes when Tony and Larry took over all the action and spotlight. But having Jack out of the field, was a good change of pace and refreshing.

While we have had to bid adieu to many lovable characters, Tony killing Larry was a bit disturbing to me (undoubtedly the most shocking twists of the season so far) as I always thought Tony is one of the good guys and was also really hoping Larry would be back the next season. With Larry gone, a Jack and Renee hookup seems inevitable (since she is already confirmed in Season 8 set in New York). As of now, it looks like a Jack and Tony showdown all the way to the end, unless something changes next episode (Which I am sure it will:) It is also interesting to see Jacks daughter back, but the father-daughter relationship probably won’t create much interest this time as I think the sole purpose of bringing her back is to save Jacks life. (Since season 8 has already been confirmed). There are still tons of questions which am sure will be answered in the coming episodes. But as of now, the writers and Kiefer Sutherland got us exactly where they want us.. Totally hooked and wanting for more.

This season is a phenomenal comeback for 24. (The ratings speak for themselves)

Thomas Friedman & Nandan Nilekani

2009-03-26T08:21:00.000-07:00

This week, Nandan Nilekani visited New York as a part of his book tour. In his book, Imaging India, the Indian entrepreneur tries to trace the central ideas that shaped India's past and present and asks the key question of the future of India and its role as a global citizen and emerging economic giant: How will India as a global power avoid the mistakes of earlier development models?

One of my friends had extra tickets to see Thomas Friedman interview Nanadan on his new book, and I immediately jumped at the offer. The interview took place at the New York public library and I must say it was certainly a very interesting conversation. They spoke on a wide variety of topics including corruption, politics, economy, caste, Infosys (Of course!!!) and the next generation Indians making their mark around the world. Thomas Friedman has a very good sense of humor and it felt good being Indian and to see Nandan not only answering all the questions with the same humor but also bringing out the truth in each of his answers as to the true state of affairs in India. He really gave a good insight into India (without any of the hype and BS) and had the whole audience engrossed from start to finish. The most interesting conversation (I thought) was about global warming and how India and China are being blamed.

Good to see we have a new Global Ambassador to India who is making the rounds.

Interesting - Market Stats!!

2009-03-03T13:56:00.000-08:00

There has been a lot of talk regarding the performance of the Dow Jones (DJIA) so far during Obama's term. Many said that his election would bring about a new sense of hope in the American psyche...I guess the markets disagreed.

Through yesterday's close, the DJIA's performance during President Obama's first 41 days in office is the worst of any President since at least 1900.

Kanda Sashti Kavacham

2009-01-09T05:11:00.000-08:00

Beautiful song on Lord Muruga!

Slumdog Millionaire – A Must Watch

2008-12-08T13:13:00.001-08:00

This past week, I had a chance to watch Slumdog Millionaire. Though I heard a lot about it, I was a bit skeptical going in as I am more than aware of the hype Indian movies generate and seldom do they actually deliver...But I could not have been more surprised.

Slumdog Millionaire follows Jamal Malik, a teenage orphan from the ghettos of Mumbai who is one question away from winning 20 million rupees on the Indian version of the trivia game show Who Wants to be a Millionaire. The movie starts off with Jamal getting tortured to get him to confess how he cheated, to his appearance on the show. The cops simply can't believe a kid who grew up on a garbage heap would know anything about anything, and tortures the kid in the hopes of getting a confession. The only snag is Jamal isn't lying and he didn't cheat. We learn the history of Jamal and the other principal characters in flashbacks, as Jamal answers questions on the TV show not from book knowledge — he has none — but his own life experiences. The movie takes you back to the various events and phases throughout his youth that led to him to really knowing the answers to the questions.

The scenes that take place in the slums are so real and it shows a level of poverty and misery that's almost beyond our imagining - and yet so real. The only let down is that by a wild coincidence, the quiz show's questions, taken in order, correspond chronologically with traumas in Jamal's young life and not to mention a fantastic actor like Irfan Khan has been wasted in an insignificant role. But the movie as a whole is a compelling piece of entertainment and is a modern version of the Cinderella story with some spicy food. The other surprising element about the movie is the music. AR.Rahman has given a smashing soundtrack and M.I.A.’s “Paper Planes” is prominently featured in the film. Only after seeing the movie did I connect the dots.

The movie is filled with humor, romance and suspense, and is easily one of the best films I have watched this year. I highly recommend it.

Where are you Mr.Raj Thackeray?

2008-12-03T09:10:00.000-08:00

Where is Raj Thackeray and his hoodlums who claim to own the city when the city is burning?

It is indeed ironic that Raj who claims to love Mumbai, was nowhere in sight as Mumbai was attacked. I am not trying to start an argument or create any animosity but rational Indians will understand that the plain truth of the matter is people like Raj Thackeray can only survive by resorting to the 'Divide and Rule' politics. He is maintaining silence when terrorists have attacked Mumbai, but he roars with political speeches against North Indians and resorts to killing, starting riots over petty issues, throwing stones and breaking public transportation because a board has not been written in Marathi. When Mumbai has been hit by a real confrontation and faces a very real issue, he has gone into hiding. Why? Well, simple...When the people unite he loses and has nothing to say.

Not only Raj, but all the politicians from Mumbai have proved to be a pathetic lot in this crisis, right from Chief Minister Vilasrao Deshmukh and his Deputy R R Patil. Deshmukh was in Kerala and it took several phone calls for him to finally realize the gravity of the situation. On his part, his Deputy did even worse. Asked how could such a big incident happen in Mumbai, he said, “In big cities, such small incidents do happen.”

Coming back to Mr.Raj, I want to know what he is going to say to the NSG commandos who fought the terrorists. Should they not have been allowed into Mumbai because they are all from the North and South India? Mumbai was not saved by his marathi goons rather it was saved by Indians. Raj Thackeray has clearly proved that he is a politician, and a cheap one at that...definitely NOT a leader.. All he can do it taunt the innocent and poor people who come to Mumbai to make a decent living.

The whole country has come together to support Mumbai Mr.Raj...Where are the son's of the Marathi soil hiding? Are you abroad on holiday or unwell? Or are you missing because the election dates in Maharashtra haven't been announced as yet? You are not scared of terrorist gunfire and bullets, or are you? Come out and pay homage to the people who laid their lives fighting the terrorists and by the way, none of them are Mumbaikers...

Citi - Finally Going To Sleep

2008-11-21T17:45:00.001-08:00

$3.77 – Closing price of Citibank today. Investors have seen similar stories this year, with Bear, Lehman, Merrill, and the endings are very unpleasant when consumer confidence falls. Looks like the end is in sight for yet another great American company: Citigroup, once the biggest U.S. financial institution of them all, looks like it is dangerously close to merging, tanking, folding, failing, falling or however else you want to say it. The shares fell today to a 12 year low even while there was a big rally in the market.

Citi Never sleeps - The once famous phrase used to describe the company may just be used for the last times in the coming weeks (or should I say days) Looking back, I guess the whole idea behind Citigroup was flawed from the start. Unbeatable scale in financial services? Forget it. We now see the good Citi's size has done for investors: the company has an unworkable business model. It is run by a senior management team that's largely unproven, with scant experience operating a large financial institution. And the company's risk controls (if the past few years are any evidence) are hopelessly inadequate to the task. While the conventional wisdom says Citi is too big to fail, the reality is it's too big to manage. As a result, the company has become a publicly traded incarnation of Murphy's Law: anything that can go wrong almost certainly will-and probably sooner rather than later. And $25 billion in TARP money isn't going to do much to turn things around. Worries about Citigroup’s problem assets will continue to weigh down investor confidence. Citigroup’s shares have traded as high as $35.29 in the past 52 weeks. It closed today under $4. Its market capitalization (market cap) – the actual value of a publicly traded company – has plunged from $195 billion at the stock’s 52-week high to just under $21 billion today.

I think it is better for the management to move quickly to sell parts of the company or merge with someone else (Goldman and Morgan Stanley have been mentioned).Citi has notched losses in each of the past four quarters, including a $2.8 billion loss in the third quarter, and has taken in excess of $40 billion in write-downs. With news like 52,000 job cuts and slash expenses by 20% just weakens the confidence and is not helping its stock. Most institutional investors and pension funds are barred from owning stocks below $5. So if Citigroup's stock remains below that level, it could trigger a wave of selling that would send the share price even lower. Though not immediately, the money managers have to get out before the end of the quarter if the price does not bounce back.

On the upside, Citi does have a strong franchise overseas and there is no sign anyone is making a run on the bank. It has sufficient liquidity and is in a comfortable position capital wise. All the institutional traders are still doing business with the bank. But the question is, can Vikram Pandit withstand the pressure or will he give in and do a deal or even sell of pieces of the company to appease the public sentiment.

It's getting to the point where it's make-or-break time. The only thing going against Citi is the loss of confidence and it may just be strong enough to bring the behemoth down to its knees. If today is any indicator, Citibank in its present form cannot, and almost certainly will not, continue to exist.

The Big 3...or Just 3

2008-11-21T15:07:00.001-08:00

There has been so much drama over the last 2 weeks focusing on Detroit. GM, Chrysler and Ford (or the Big 3) wants a government bailout (heck why not, everyone else on Wall Street is getting free money for screwing up) but no agreement has been reached so far. The democrats flew to Detroit, headed by Pelosi, and met the big guns and promised them a bailout. The big three came back to Washington and in their private jets (what were they thinking) and asked for a 25 Billion package and said Bankruptcy was not an option for them. Then the lame duck congress rebuffed them and now the democrats have given them until 2 Dec to submit a viable turnaround plan so assistance can be given to them. Phew!!

I guess in this economy it is all but boiling down to consumer confidence. And make no mistake, it will get worse and fear has already taken over the entire country. But giving the auto industry a bailout does not solve anything. Assistance of some, shape or form will probably be worked out by the new administration, but my point is nothing is going to change until the American auto industry fundamentally changes its current practices. GM, Ford and Chrysler may ultimately receive loans or other financial support from the U.S. government, although the form, timing, and magnitude of this assistance are difficult to predict. The govt will probably give billions without knowing what it is getting into (read AIG, after announcing a $85 billion bailout, the govt increased it to $140 billion and still no one knows what’s going on there). Anyways, it is important to stress that such assistance will only buy more time for these companies rather than as a solution to their fundamental business risks, which will remain no matter how much money they are given.

If any bailout is given, there should be a lot of strings attached. First, Detroit’s huge disadvantage in costs relative to foreign brands must be eliminated. There needs to be a fundamental shift in the cost burden weighing down the industry and the cumbersome contracts with UAW that make work rules a constant challenge. The American car companies are unable to compete as they are not able to align pay and benefits to those of competitors like Honda, Nissan and Toyota. Also, the existing management must be shown the door. None of the CEO's want to step down and take responsibility but all of them want a free pass (read tax payer's money). Rick Wagoner has been the CEO for the last 8 years at GM and he literally has nothing to show for it. I wonder what change he is going to bring once he gets our money. If he was going to bring the change he is promising, GM would not be begging for assistance. Robert Nardelli who heads Chrysler took a $210 million package from Home Depot last year and landed this job. Wonder what real incentive he has to bring about any change. Alan Mullaly, CEO of Ford, has indiscriminately fired his workforce in the name of cutting costs and Ford literally has no one left to bring about any change no matter how much money they receive. The stakes are high. The Detroit automakers employ nearly a quarter-million workers, and more than 730,000 other workers produce materials and parts that go into cars. About 1 million more people work in dealerships nationwide. They burned through nearly $18 billion in cash reserves during the last quarter - about $7 billion at GM, almost $8 billion at Ford and $3 billion at Chrysler. GM and Chrysler have said they could collapse in weeks. So no two ways about it in my opinion. The existing management has to be fired if any meaningful turnaround is to be achieved in the Auto Industry.

There is another interesting question which the big three are asking to make a case for their bailout stating that Consumers will not buy cars from a bankrupt company. But at this point they have all accepted that they are burning through cash at an alarming rate and GM has publicly stated it may not survive for long as it has no liquidity. Interestingly, while all of them want money, none of them have anything to say explaining how the money will be spent. Though it is a tough decision, filing for Chapter 11 and/or an organized bankruptcy may give them the best chance of re-structuring and re-negotiating existing thorns and ultimately re-emerging as a stronger player.

Where Will It End?

2008-11-20T11:07:00.000-08:00

I got an interesting email from my sister this morning and she could not have summed up the pain and frustration everyone is feeling any better. So with her permission, I am putting up her email on my blog. So here goes.....

Are'nt we all getting tired of this recession? Yeah yeah there are a bunch of you out there who are still in denial about the country being in recession, but whatever you'd like to call it, are'nt we just beat, bored, broken down, burned out, distressed, drained, exhausted, fed up, pooped, worn out and just dog-tired of what’s going on? Yes the down turn is in its peak, yes the government has no money, yes people are losing their jobs and yes we're scared to spend in the fear of losing our jobs. 2008 saw the fall of the bank and 2009 is going to see how this translates into core industry. A couple of weeks back there was a surge of hope when the American folk went and voted for the the golden boy .... but the stock market has accomplished stripping us of all traces of elevated spirits after that.

The DOW closed under 8000 yesterday and while it sounds about right, there’s a part of me that wants the DOW to plummet to its lowest ....TODAY! At least we can move on after that. But the other part of me knows that we can’t drop too fast either. We need to feel every pang of misery, slowly and painfully, so that we rid ourselves of all our sins and make for a fresh start.

The dot com bust and the govt surplus during the Clinton administration was reason enough for the recession to set in (its a zero sum game people - surplus with the govt means no money circulating amongst the public - well more or less), but that recession was one that should have been worse than it was. The super hero of the moment was Alan - Visionary - Greenspan. When Clinton shouted 'Affordable Homes for all Americans' Greenspan should have stepped down and let the monkey run the Fed in the hope of a random lucky move that monkey might have made. Instead he sealed the fate of the economy with his monetary policies. Affordable homes indeed.... all for about 2 seconds.. then they became unaffordable again when the 'visionary' raised interest rates and forced the American to default. Lets not forget the banks.. now now how could we forget the greed that this industry so beautifully camouflages into helpful stances for all common man! You're worried about Wall Street - HA! Main Street feeds Wall Street's avarice!!

So where are we now? The American man cant pay back his home loan - so banks don’t have any money - so corporations cant borrow money - so corporations cant start new projects - so corporations have to let go of workers - so workers cant pay their mortgages... what a cycle!.. and once started we cant stop the downward spiral. And not to forget the derivative markets that have exploited every single portion of this cycle. Now with everything failing, is there a floor? We thought banks might see their write-off floors when the government proposed the buying of troubled assets. Banks could sell their troubled assets for eg. 40 cents on the dollar (whatever the amount - we don’t know) and they would not have to write off more than the left over 60 cents. Banks would rake in the 40 cents as capital and life was supposed to move forward. The $700B bill struggled initially but finally went through both the Senate and the House and Henry Paulson took possession of the first $350B to start his clean up work... We've seen the stock markets rally and spiral a few times since then and we've also seen the new president-elect create waves.. but we haven’t seen the buying of troubled assets. From his statements, it seems like Hank's changed his mind. Bank stocks are plunging again and we have no idea what the floor is. Whatever it turns out to be, lets hope we don’t see it higher or sooner than it should be. From the policies during the last recession, Greenspan created a huger monster that is the down turn now.. With all the bailouts and the bandaging and caretaking the Feds are doing, lets hope we're not creating an even bigger mess.

Go(O)bama

2008-11-06T14:28:00.000-08:00

I must admit, being a conservative and a supporter of Bush so far, Obama certainly grabbed my attention ever since he began his run for presidency. The way he ran his campaign was admirable and he never hit anyone below the belt. He always emphasized on hope and made the country feel inclusive in all his messages. I stayed up watching TV and when the winner was revealed, it was certainly a profound moment. Given the history of the country and where we have come, I was reassured that the American Dream is real and alive.

I guess the over-whelming reason Barack won is because the whole country wants someone to desperately restart the country, from the economy to the living standards, from education to health care and of course the foreign policy - everything appears to be currently broken. The country gave a clear mandate as they see in Obama what they wanted to see - Hope. No one trusts Bush anymore (even me) and the republicans were sent packing as they should have been. To Obamas credit, he had perfect execution of most of his themes and he hammered a home-run with his campaign’s ground game. McCain and Palin..Well, I won’t go there but after she shopped for $150k, I knew it was totally over for both of them.

People have voted for change - What change Obama can bring and the direction of the change remains to be seen. I will pray he is a successful president as America really needs a new direction.

Remembering My Father

2008-10-22T13:59:00.000-07:00

My gratitude to God for my father. I am blessed to have known him, loved him, and been loved by him since the day of my birth.

My father has always been a very special person...flawed and imperfect, as we all are, but loving and generous. Today is my dad's 4th Death Anniversary. The man who had the most influence on the man I became passed away on Oct. 22, 2004. He succumbed to a heart attack at age 52 and It was one of the saddest days of our lives. My whole family was stunned as he had never been previously diagnosed with any heart conditions and it was a shock beyond words can describe. It has been said that the loss of a parent is one of life's most traumatic events. I now know the devastating truth of that statement. My dad was a very important person in my life, and he still influences me in his death. I am grateful for all of the things he did for me. I know now how right he was even when I thought I knew everything.

The last time I saw my father was a warm night in mid march, 2004. He dropped me off in the airport where I was scheduled to catch a flight back to NYC. He gave me a big hug and wished me well. He said he was proud of me and told me to take care of myself. To this day I can never forget those last moments and keep re-living them every time I close my eyes.

My father was a prideful man, but not like most would think of it. He was proud of the achievements of my mother and myself; Though my brothers were young, he always encouraged them to dream and achieve. He was proud of the achievements of everyone in our family; he was proud of the accomplishments of his friends and everything in my father's life centered on caring about others. My dad never let a friend ever be forgotten, no matter where he was, and that's a major tribute to the kind of man my father was.

My dad was a genius when it came to movies. He loved watching movies. In fact he was crazy about them. I remember he would stay up till 3.00AM watching movies almost everyday and he used to write reviews which were published for various magazines/papers. He had this knack of knowing what will click with the audience and he served as a story editor, writer and gave creative inputs for dozens of films. I remember a lot of producers and directors used to come to my dad for ideas around story and screenplay. When he listened to a story or a song for the first time, he used to say immediately if it will be a hit or flop and sure enough he was never wrong. And even now, when I watch a film or a show, the first thing I think is how he would critique it.

With my dad, every Sunday was 'Breakfast Day'. He used to take me, my brothers and all my cousins to have breakfast at our favorite drive in restaurant. I remember the first watch he bought me at Alsa Mall. To this date, I guard it with my life and wear it on every important occasion in my life. He also bought me a He-Man toy every month and I always think of him every time I look at my Castle Greyskull and remember how he used to play with us sometimes.

My dad was also a teacher early in his career and I remember all the lessons he used to give me when I was young. He used to be very strict with me when it came to studies and I remember every time I flunked, he would take extra time to tutor me and teach me the lessons again. I greatly enjoyed our time and after a while I began flunking on tests in 5th grade on purpose and would proudly come home and demand that he tutor me again.

I remember my dad taking me to learn how to drive. I got my earliest driving lessons from my dad in his white ambassador. I was so excited that he actually allowed me to get behind the wheel of his car and the more I got excited, the more paranoid he got. This one time, I remember getting into an accident as I misjudged the distance and rammed into a truck. Luckily no one was hurt and my dad was sitting next to me and had the presence of mind to handle the situation, while I was still sitting quite stunned.

Most of all, though, I remember my dad coming to the airport to pick me up and drop me off every single time I came back home. Ever since I left home, he had not even missed coming to pick me up and drop me off even once and I can still almost see him every time waiting for me when I go back home. Next was his belief in his God; belief was important to my dad. He used to make a trip to Tirupathi every year without fail even if he had to go alone.

I learned from his strengths; I learned from his weakness and it is all those strengths and weaknesses that has taught me how to be the person I am today. I was only 26 when I lost my dad and I so desperately to tell him how much has happened in the last 4 years since he has left us. I want to wrestle with him on the floor, I want to watch him working from afar. I want to fly him around the world and take him to all the places he always wanted to go but never had the time to. Though there are a lot of things I will never be able to share with him, he has left me with a life time of memories.

I never fail to think of him even though I know that he is not there anymore. Sometimes I pretend he is still there and talk to him. Over the last few years I have discovered many ways I am similar to my father, but it was not until this year that it really struck me just how many similarities there are. I cannot of course speak of them, but I just wish dad is still here with us to share our successes and happiness.

Miss you dad and we love you and I know you are watching over us and guiding us wherever you are!!

Wall Street Words

2008-10-11T12:29:00.000-07:00

CEO --Chief Embezzlement Officer.
CFO-- Corporate Fraud Officer.
BULL MARKET -- A random market movement causing an investor to mistake himself for a financial genius.
BEAR MARKET -- A 6 to 18 month period when the kids get no allowance, the wife gets no jewellery, and the husband gets no sex.
VALUE INVESTING -- The art of buying low and selling lower.
P/E RATIO -- The percentage of investors wetting their pants as the market keeps crashing.
BROKER -- What my broker has made me.
STANDARD & POOR -- Your life in a nutshell.
STOCK ANALYST -- Idiot who just downgraded your stock.
STOCK SPLIT -- When your ex-wife and her lawyer split your assets equally between themselves.
FINANCIAL PLANNER -- A guy whose phone has been disconnected.
MARKET CORRECTION -- The day after you buy stocks.
CASH FLOW-- The movement your money makes as it disappears down the toilet.
YAHOO -- What you yell after selling it to some poor sucker for $240 per share.
WINDOWS -- What you jump out of when you're the sucker who bought Yahoo @ $240 per share.
INSTITUTIONAL INVESTOR -- Past year investor who's now locked up in a nuthouse.
PROFIT -- An archaic word no longer in use.

Mark-To-Market - Hero or Villain?

2008-10-11T12:21:00.000-07:00

The financial markets are getting clobbered everyday to a point where it makes no sense anymore. It is not a question of 'Will', but 'When' the next write down is coming. If it not really ‘If’ but ‘Who’ will be the next bank to fail. One of the biggest problems is being blamed on the "Mark-to-Market" accounting rule. Mark-To-Market (MTM) accounting rules have turned a large problem into an ever larger one. MTM also known populary as ‘Fair Value’ accounting is facing opposition now from all quarters as it is forcing financial firms to treat all potential losses as if they were actual cash losses. i.e. this rule assumes that what people are willing to pay for an asset is always the same as the asset's value. This means that companies must value the assets on their balance sheets based on the latest market indicators of the price that those assets could be sold for immediately (read today). Under such a rule, declining housing prices don't just reduce the value of defaulting mortgages. They reduce the value of all mortgages and all mortgage-related securities because the housing collateral protecting them is worth less. For e.g. lets say the mortgage was sold at X today. But when the value of the house reduces (especially now with the credit markets frozen up) and someone is only willing to pay X-5 for the same mortgage today, the rule says the firm must immediately write down a loss of 5 as the mortgage can be sold for X-5 today.

Its a tough rule since there is no market to establish the real value and not all assets that have no trading market are bad assets. Moreover, the firms do not have to sell them today itself, so does it make sense that they really have to value them at the prices they fetch today? Even if the firm does not sell at the low price, and even if the value of these assets is above the price at which others are willing to pay today, the firm must record them as losses on the books - the sole reason which is causing write down after write-down, thereby violating capital requirements causing the equity to tank and in turn the stock prices to fall. Once panic sets in, we have seen what can occur with Bear, Lehman and ML - people simply start panic selling, even when they know the underlying business of the company is fine. It looks like a vast majority of mortgages, corporate bonds, and structured debts are still performing. But because the market is frozen, the prices of these assets have fallen below their true value. Firms that are otherwise solvent are bring forced to price assets at fire-sale values chasing away capital and leading to a further decline in asset values. All the banks have taken a hit because of this rule.

Further confusing investors, the rule has inconsistent application across industries and companies. MTM favors private companies over public companies. As the government is being so aggressive with the use of these capital regulations with the banks, we can see just about the only transactions taking place in the sub prime marketplace have been sales to private equity firms that do not have to mark assets to market prices.

Banks, though, are subject to regulatory capital standards and therefore can be rendered insolvent overnight based on an accounting write-down. The same is true of what happened to Fannie Mae and Freddie Mac, which had positive cash flow when they were nationalized by the Treasury. Here's something you won't believe: Fannie Mae and Freddie Mac have not drawn a dime from the Treasury's $200 billion facility that was created to bail them out. It was the use of mark-to-market accounting that allowed Treasury to declare them bankrupt. On a cash flow basis, they were solvent.

Because of all this, Washington finds itself in a somewhat awkward position in that its own rules is rendering many financial institutions insolvent in a manner which does not reflect their true value. A lot of big banks (Actually all of them) are currently lobbying heavily in Washington to get rid of the MTM accounting rule. But I think a mere accounting rule change won't reduce foreclosures or raise home prices -- then again, if spared drastic write downs, banks might be more willing to lend, raising home prices and reducing foreclosures. The economy might just jumpstart but at this point my guess is as good as yours and the truth is no one knows how things are going to play out.

The $700 Billion Dollar Question

2008-10-08T20:02:00.000-07:00

The stakes are clearly huge in the Treasury's proposal to stabilize the US financial system. It looks like the treasury secretary, Paulson, has become even more powerful now with $700 billion at his disposal. I think the plan which promises to buy up to $700 billion of a variety of troubled assets (read mortgage-related securities and loans) will at least enable financial institutions to restructure and recapitalize their balance sheets. But while Wall Street may be bailed out, i still question the impact to Main Street. But a lot of critical answers seem murky or unanswered like what the real prices for these distressed assets are or how these assets will be valued. Also, who is going to manage them and is the government really going to hold them till maturity like it claims to.

The participating financial institutions can dispose of their troubled loans and securities closer to their intrinsic value..this means that all the problem assets will be flushed out and the banks can resume getting back to normalcy. This would go a long way to restore confidence since there won’t be any 'write- downs or losses' every quarter.

Here are some questions for which I think we need some real answers.

How will prices be determined? - This will totally make or break the success of the bailout. With all the write downs as any indications, setting the purchase price is not an easy task. The pricing at which Treasury buys the assets will likely become the benchmark pricing for all mortgage assets.

How will banks decide whether to participate in the Treasury program? - This is weird as participation in the Treasury asset sale program is voluntary. Banks can keep mortgage assets if they consider Treasury asking prices out of line with intrinsic values, taking into consideration ultimate losses from defaults. Again, goes back to the previous question, if prices are not set correctly, banks simply won’t participate.

What will be the impact of such sales to capital base? - This is kind of a double jepordy as the impact on financial institutions' capital will depend on the price levels at which the Treasury makes its purchases. Even if the firms choose not to participate or sell assets into the program may also need to mark down assets based on newly established benchmark prices, leading to erosion of their capital....there by coming out with more 'write-downs'

Is $700 billion enough? - This is the golden one. $700 billion is a lot of money. It is much greater than the $85 billion loan to AIG plus another $38 billion they are giving AIG (just announced today), and the $100 billion of capital support to Fannie Mae and Freddie Mac or the $29 billion to JPMorgan deal for Bear Stearns.

This bailout seems like an extraordinary governmental intervention - although it will provide important short-term relief, does not look like a complete solution to the financial markets. Again make no mistake; the plan will help the banks. I don’t see how the common man is going to be really benefited. To think that the ex-chairman of Goldman will be handing out $700 billion to other wall street banks... It just seems like wall street's his inner circle will benefit from all of this even more... Just barely was the plan announced and he already tapped his favorite banker from Goldman to be his adviser. I just question why the taxpayers money is being used to make wall street CEO's more rich and help them get bigger tax breaks.

Saying Ta Ta to TATA

2008-09-23T11:39:00.001-07:00

Oh! What a circus it has been. Will they? Won't they? Will they? Won't they? This has been the question on everybody's minds over the last 4 months. TATA is being forced out of West Bengal (well they better leave if the highly anticipated Nano is ever to see the light of day) and to add insult to injury, their deadline to meet the Nano roll out seems all but impossible...and the first year target of 3 lakh cars, well, lets not even go there. The ongoing impasse at Singur has also made Tata Motors' top vendors extremely uncomfortable, prompting many of them to either announce a pullout or a significant scaling down of operations in West Bengal. Bengal stands to lose not just the mother plant but 56 ancillary units and the jobs they would create as well. The agitation has also resulted in the scaling down of Nano targets for this calendar year.

The Players

Mamta Banerjee- Who leads Trinamool Congress is leading the protesters and farmers and has demanded the return of 400 acres of land
Ratan Tata - Chairman of Tata, who must be wondering what the hell he was smoking when he decided to set up shop in West Bengal
Buddhadeb Bhattacharjee - The CM of West Bengal who has made a total mess of the situation and is helplessly seeing other industries pull back from his state
The Farmers - who are blindly following anyone who will give them money for their land

Agitation and Political Drama
The Govt of WB acquired around 1000 acres of farmland in Singur so the Nano plant could be set up by Tata. The trouble started after the Left Front-led Government offered compensation in return but some villagers complained that they had not received their dues. Sensing political opportunity, Mamata Banerjee jumped in to score some political points and she started demanding the lands be returned, which she alleged was forcibly taken from "unwilling farmers" to build ancillary industries adjacent to the main plant. The government is countering that it is too late to give the land back, that the project is too important for the state economy, that giving hundreds of acres back would essentially close the Nano project at Singur. In all, around 400 acres of land is still being fiercely disputed out of the 1,000 acres acquired by the State Government. Violence was encouraged and the farmers unwittingly became pawns in the political drama that has been unfolding over months and which only seems to be getting nastier by the day. Demonstrations and indefinite protests were staged and Tata's employees were attacked as the whole country watched with surprise as to what was happening to one of India's biggest corporations.

Give us the Money - Strangely it looks like over the last 2 weeks, more and more farmers are just collecting cheques from the state govt and giving up their land. Then there are many more who are trying to re-negotiate their land prices and want more money. At the same time, Mamta Banerjee is throwing more tantrums and staging more protests. She has even set a one week deadline for the govt to resolve the issue and is calling for the govt to step down since it has failed. While the farmers want money, it looks like mamta wants as much political mileage as she can get while claiming to fight for the unwilling farmers. Unwilling farmers?? What unwilling farmers.

This is certainly a strange case as it looks like the left, which has historically been against changes, are in front championing investment and reform, while the opposition (read Congress and BJP), who have always complained against the leftists for being against reforms, are trying their best to stop the development of the project in the state. As I write this, it looks like TATA has been offered 1000 acres by Karnataka in addition to Maharastra aggressively courting them as well. In all, 12 states have rolled out the red carpet to TATA, while the govt and opposition are continuing to fight with each other demanding the other step down.

This critical issue can only be solved by politicians with a commitment to India’s development and not by opportunist politicians who are just raising slogans to score quick cheap points. We need good opposition just as much as we need good government. At this time, I don’t think we have either...at least in the state of West Bengal.

Around The World...Banning Short Sales

2008-09-22T13:16:00.000-07:00

It is amazing how much controversy there is surrounding the ban on short sales. While the decision has drawn relief from some quarters, let there by no doubt that there are quite a few people who are unhappy with SEC's decision. While UK took the first step to ban short sales and added pressure on other markets to respond, the US followed suit shortly. And now it looks like the entire world is jumping on the bandwagon with Australia, Taiwan, Netherlands and Germany also confirming the ban of short sales in their respective exchanges.

I suspect that the ban was done to appease the common investor who has probably been wiped out in the ongoing financial tsunami and as the politicians realized they have to do something to make themselves look good. The Fed and SEC have clearly indicated with this decision, that they are and will go to any lengths to preserve the US financial system collapse including changing the rules midway through the game, with no public comment or participation if required. Note that the ban on short sales does not mean that stocks will only go up. China's market has fallen by more than 50% this year alone even though short selling is not allowed at all.

By banning short selling world over, it looks like what the governments are clearly worried about is the fine line between "freedom" and "manipulation". I personally think that there is nothing wrong with borrowing stock to short, but given the sensitiveness in the global market, the worry is that even a small/negative sentiment can cause a big shift in markets which in turn can cause greater panic worldwide. Note that there can be 2 kinds of short selling. Normal short selling occurs when investors borrow shares and sell them, hoping the stock will fall and they can buy back the shares at a lower price. Naked short selling occurs when an investor sells a stock without first borrowing the shares, and that practice allows investors to flood the market with sell orders, potentially driving down share prices.

Why the ban maybe difficult to enforce

First off, this is only a temporary ban. Let’s wait and watch if the ban is made permanent. If it is, it will significantly change the rules of the game
Over the past few years the options market has grown to reach the ordinary investor. There is nothing that short selling provides which cannot be done through put options, albeit at slightly higher cost, due to the options premiums and the bid/ask price spread.
Volumes in credit-default swaps and other derivatives trades and options are likely to rise in the wake of the short-sale restrictions - This is likely to cause a bigger headache as these complex derivatives are not subject to full disclosure and they are not publicly traded
This will cause the traders to start focusing on non-financial stocks which can still be shorted via ETF's etc.
Hedge Funds will be unable to hedge large positions and will likely take some hits. (Not sure what the impact will be to the broader markets once hedge funds start to fail)

Disclose Positions?
Apparently just banning short sales was not enough. After the announcement, pressure mounted for the SEC to do even more as its counterpart in London increased its regulatory responses. By evening the SEC came up with a new surprise – It required investment managers to publicly report their short positions weekly. Though I believe the SEC has every right to obtain and review information about short positions for market surveillance purposes, but forcing public disclosure will have serious consequences for the market. Companies will most definitely retaliate against short sellers. Portfolio and fund managers will lose their ability to manage assets without revealing their strategy. Once someone is short selling a security, other traders will simply do the same thing adding more pressure and this may trigger panicky selling if an investor sees that noted short sellers have shorted the stock.

These are extraordinary times and agreed that we need to support the govt’s efforts to ensure that fraud and manipulation have no place in this market. But the confusion and scapegoating that has ensued may well do more harm than good. Short selling or even naked short selling cannot destroy a company that has any real underlying value to it. Bear, Lehman and the other financials didn’t getting pounded because of short selling. They got pounded because the leverage game was over. I think because of the temporary ban, there is going to be a big rally - albeit an artificial one - which will end by still not revealing the true intrinsic value of the stocks.

And Then There Were None

2008-09-22T09:32:00.001-07:00

As the Fed is rushing to pass the 700 billion bailout in Congress, the last remaining 2 investment banks Goldman Sachs and Morgan Stanley have been transformed into bank holding companies. This completes the decimation of the good old investment banking model and re-writes wall street as we know it.

Well, what this mean for Goldman and Morgan - they will be able to begin taking deposits like traditional banks which will increase their cash balances. In return they will be subject to far greater regulations and look more like commercial banks. They will also need to hold higher capital reserves and take less risks. And in return to subjecting themselves to more regulation, they will get full access to the Fed's lending facilities and discount windows which should help them avoid a Lehman like situation.

As bank holding companies, the two banks will have to reduce the amount of money they can borrow relative to their capital. That will make them more financially sound but will also significantly limit their profits. They are both highly leveraged compared to traditional banks. Today, Goldman Sachs has $1 of capital for every $22 of assets; Morgan Stanley has $1 for every $30. This will have to come down for both. By contrast, Bank of America's has less than $11 for every $1 of capital.

So, now that the stocks of GS and MS will trade like banks, are they really worth $130 and $27, respectively? I doubt it. But we might not know what the market really thinks about all this until the ban on short-selling is lifted.

Here we go..From 5 to 2 in 6 months!!

2008-09-15T13:48:00.001-07:00

A perfect Storm.. Return of the Black Monday...Wall Street Hurricane.. Financial Tsunami..

These are some of the terms that are being coined to describe the unprecedented chain of events that have occurred over the last 24 hours. Lehman Brothers has collapsed and Merrill Lynch has agreed to be taken over by Bank of America. The events of Sunday September 14th and the day before were extraordinary. The weekend began with hopes that a deal could be struck to save Lehman. However, as the weekend progressed, it looks like the fed drew a line in the sand citing moral hazard and BOA and Barclays balked at the idea of having to takeover Lehman with no Fed backstops.

Around Sunday evening the chatter began that Lehman would not survive and late Sunday came the stunning news on the Lehman website that it had filed for Chapter 11. Though founded in 1800's, Lehman is not 158 years old as many people believe. Lehman is a 14 year old investment bank with a 158 year old name. Though the bank has access to a Fed lending facility which was introduced after Bear’s takeover by JP Morgan Chase, the collapse of its share price left it unable to raise new equity. At the end of August, Lehman had $600 billion of assets financed with just $30 billion of equity. Even a 5% decline in assets would wipe out the value of the company, which investors saw as a real risk due to the company's billions of dollars of mortgage securities. S&P lowered its long-term counterparty credit rating on Lehman to 'SD' (selective default, meaning payments may not be made on some financial obligations), from 'A'. The rating actions followed Lehman Brothers Holdings Inc., the parent/holding company of the Lehman Brothers group, filing for Chapter 11. At this time, it is not clear whether Lehman will default on its holding company senior and subordinated debt obligations. It is also uncertain whether the proceedings will ultimately include some of Lehman's affiliates in the U.S. and in other countries or whether regulators will take over those entities. Where bankruptcy protection leaves Lehman employees remains unclear. Although some are thought likely to pack their stuff up and ship out Monday, the fact is that the broker-dealer and investment management units are not included in the filing. Lehman has also filed motions to continue paying its employees in the meantime, though large scale layoff's are expected anytime.

The government's refusal to help with a bail-out of Lehman will strip many firms of the benefit of being thought too big to fail and with these developments the crisis is entering a new and extremely dangerous phase. The biggest worry now is the effect on derivatives markets particularly the credit-default swaps. Lehman is a top-ten counterparty in CDSs and holds contracts with a notional value of almost $800 billion. With Lehman left dangling, official attention is now turning to putting more safeguards in place to soften the coming shock to markets and the economy. The first step has been to encourage Lehman’s counterparties to get together and try to net out as many contracts as possible. It also has over 100,000 creditors. The inability to find a buyer is a huge blow to Lehman’s 25,000 employees, who own a third of the company’s now-worthless stock; On Sunday the Fed also expanded the list of collateral it will accept for loans at its discount window, to include even equities; and dealers may lend any investment-grade security, not just triple-A rated, to the Fed in exchange for Treasury bonds.

Merrill’s rush to sell itself was motivated by fear that it might be next to be caught in the stampede. Despite selling a most of its rotten assets recently, the market continued to question its viability. Its shares fell by 36% last week, and hedge funds had started to move their business elsewhere. John Thain went right ahead and struck a deal before markets reopened. Despite what people say, I think it’s a smart move as Mr Thain has not only managed to shelter his firm from the storm but he has also secured a price well above its closing price last Friday, $29 per share compared with $17 close. How he managed that in such an ugly market is not yet clear. Ken Lewis, BofA’s boss, is no fan of investment banking after he was stung by losses and openly declared he is pulling back. Having failed to build his own investment banking unit, he coveted Merrill’s formidable retail brokerage and got it all. It will be a logistical challenge all the more so since BofA is in the middle of digesting Countrywide, a big mortgage lender. Commercial-bank takeovers of investment banks have a horrible history because of the stark cultural differences. And it is not clear if BofA has a clear picture of Merrill’s remaining troubled assets.

The takeover of Merrill leaves just two large independent investment banks in America, Morgan Stanley and Goldman Sachs. Both seem to be in better shape but this weekend’s events has undoubtedly cast a shadow over the standalone model.

Even if markets can be stabilized this week, the pain is far from over—and could yet spread. The foreign markets are in the red and the Dow has crashed more than 500 points as I write this – its worst performance in 7 years. Worldwide credit-related losses by financial institutions now top $500 billion, of which only $350 billion of equity has been replenished. This $150 billion gap, leveraged 14.5 times (the average gearing for the industry), translates to a $2 trillion reduction in liquidity. Hence the severe shortage of credit and predictions of worse to come.

As spectacular as this weekend was, more drama is on the way as a Category 5 hurricane is testing the strength of the Financial levees.

Hasta La Vista…Musharraf!!!

2008-08-11T19:46:00.000-07:00

After months of going back and forth, the Pakistani ruling coalition has began its crucial session and seem to be getting ready to impeach Gen. Musharraf for alleged misconduct, violation of the Constitution and financial irregularities and any other charges they can tack on to ensure that he is voted out. Although Musharraf has vowed to slug it out in parliament, he is expected to step down voluntarily as there are rumors of secret negotiations to give him immunity from prosecution if he does so.

The government has been mulling this move for months as Zardari and Sharif have been at loggerheads as to how to proceed with the impeachment process. Zardari’s and Sharif’s cooperation is purely driven by political missteps on both sides. PPP has historically been anti-army and once Zardari decided to work with the general at America’s urging, he immediately drew criticism. Sharif seized the opportunity and took an anti-American stance and boosted his popularity at home. The only thing they have in common is the mutual hatred they share for the general. Musharraf threw Sharif out of the country in 1999 and imprisoned Zardari for 6 years before letting him leave the country in exile. So they both have come together now realizing the only way both can survive is by ousting Musharraf first before they can get into the boxing ring to fight each other. The general for his part did not help himself by starting a war in his own backyard by asking the military to kill his own countrymen. This has made him so unpopular that Washington has decided to step back realizing that they cannot support him anymore for the risk of alienating the democratically elected government. At least a working relationship with the new government would be better and is necessarry for the US considering bin laden is probably holed up somewhere on the borders of Pakistan.

The impeachment is a numbers game. Both houses of the Pakistan’s parliament have a combined strength of 442, and the motion will have to be passed by a two-thirds majority or 295 members. The coalition claims to have enough numbers but the result will depend on the independents who could be swayed by the ISI. Though the army chief is Musharraf’s handpicked successor, it is unlikely he will intervene as he too has realized that any army intervention will only make Zardari and Sharif stronger.

At this point, it looks like Musharraf will be packing his bags and heading out of Pakistan...for good!!! The US may try to ensure he gets out of the country without facing any treason charges. Incidentally, the impeachment proceedings against Musharraf have been initiated on his birthday.

I am sure Bush must be saying Hasta La Vista…Baby!!! Or at least thinking of it.

Let The Games Begin!!

2008-08-08T15:29:00.001-07:00

The date of today's Opening Ceremony was carefully chosen. The number eight is considered lucky in China so 8-08-08 is a particularly auspicious date. Beijing has stunned the world with its opening ceremony which began at 8:08 pm orchestrated to perfection. The US has dominated the medal count for the past 3 Olympics, but this year, most people believe they will be given a run for their money.

With 302 gold medals at stake over 22 days, let the games begin.

The 7 Year Talk (That Failed)

2008-07-30T12:07:00.000-07:00

As I was reading the papers this morning, I realized that one piece of news dominated all the papers. The global trade talks, or the so called Doha, failed after 7 years of on-again and off-again negotiations, as none of the countries could reach an understanding. But all the articles I read blamed primarily India and China. I was laughing to myself as it looks like not many people have an understanding of the real reasons of why the talks failed. Why blame India and China?? The US is probably frustrated that they are not able to impose their will on the entire world anymore given that India, China and Brazil have emerged as trading powerhouses. The Doha talks aim to open markets for farm, manufactured goods and services around the world but have struggled to overcome differences between rich and developing nations.

The issue at hand was simple. Developing countries like India and China were asked to reduce tariffs on agricultural and industrial goods, which in turn would allow developed countries like the US, France and Britain to gain access to these markets. India and China however wanted a safeguard clause that would allow them to raise the tariffs in case there was a sudden surge in imports which would threaten their farmers in the domestic market. The US wanted to set the trigger at 40% while India and China wanted it to be set at 10%. No one could agree on the SSM (Special Safeguard Mechanism) and the talks broke down.

The criticism may sting, but the two Asian giants are not likely to succumb to overseas pressure. Both countries enjoy high economic growth, thanks to overseas demand for their manufacturing and outsourcing services. One fact that no one is talking about is that in 2003, the US did the same thing i.e. they invoked a so-called “safeguard” rule to prevent an increase of Chinese textile imports that threatened to put the US manufacturers out of business. So when India and China now want the same safeguard clause, the US is refusing to accept the Chinese and Indian position. Indian and Chinese leaders also have to worry about economic hardship of their farmers as they have struggled to compete against imports from the U.S. and other countries. It's interesting that China and India are being blamed for the failure of these negotiations - the real culprits are the massive farm subsidies in the US and Europe. The playing field is heavily biased in favor of developed nations which give out subsidies to their own farmers while trying to pry open markets in poorer parts of the world. The Americans and Europeans were pretty much asking weaker countries to dismantle their own protection measures without doing the same in their own countries. I'm glad India, China and Brazil had the clout to say no.

While the US has a mere 2% of its population who are farmers (and even they are rich), India has more than 50% of its population doing agriculture and earning less than $2 a day (There are 700 million people who directly or indirectly depend on agriculture in India).China has approx. 500 Million people living in countryside with no basic amenities. Lowering tariffs and giving subsidies will pretty much bring more than half the population in these countries to their knees.

America having the biggest economy in the world was making its own rules through the WTO and was changing them as they saw fit. Again, nothing wrong with that but as China and India builds a larger economy, expect them to do the same.

Iran and Its Missiles

2008-07-11T16:15:00.001-07:00

It appears that Iran has put out a fake photo of their recent missile launch, showing four missiles shooting through the air rather than three. Though it can’t be said with any certainty whether there is any official Iranian involvement in this drama with a funny twist, but the image released by the State showing Iran firing its missiles was “apparently digitally altered”. The fourth missile “has apparently been added in digital retouch to cover a grounded missile that may have failed during the test”. Early this week, Iran said it test fired a series of long range and medium range missiles escalating the tension over its nuclear program. I guess Iran is just trying to send a signal to the rest of the world about their capabilities but it looks like they are grossly exaggerating their strength.

I guess the whole purpose of these launches was to demonstrate Iran's capabilities and a photo showing one out of four rockets failing doesn't have the intended impact, but hey, at least we know Iran’s state media uses Photoshop.

Oh Barak!! Are You Running to the Center?

2008-07-10T07:51:00.000-07:00

With both the DNC and RNC just over a month away, the battle lines are being drawn. However, it looks like it will be the independents who will decide who will take oath in the white house next year. Obama, the presumed Democratic presidential nominee, has interestingly begun taking centrist or even hawkish positions in recent weeks on foreign policy, trade, the death penalty and other hot-button issues as he introduces himself to independent and swing voters, many of whom know little about him or have heard criticisms that he is too liberal or that he is a muslim. While Obama is making a play for centrist voters, McCain's strategy seems more geared to catering to the conservative base, as he has steadily moved to the right on a range of issues.

But as both Omaba and McCan try to appeal to the idependents, both are reversing or flip-flopping (Since that seems to be the popular term) on almost all of their policies on which they won the primaries. However, it is Obama who is beating McCain to the punch as he is moving so quickly to the center that he has irked some of his supporters, well actually a lot of his supporters.

In the primaries, Obama supported pulling out of Iraq, called the DC gun ban constitutional, backed the subjection of telecom companies to extensive lawsuits if they cooperated on terror surveillance program, opposed welfare reform, criticized free trade deals and pledged to renegotiate NAFTA and fiercely opposed it and was strongly against the death penalty.

However, he has now almost taken a different path and deviated on all his own stances. He told Fortune magazine he believes in free trade and does not want to overturn or pull out of NAFTA. On Iraq, Obama said that his upcoming trip there might lead him to refine his promise to quickly remove U.S. troops from the war and he will now listen to the general (we all know how that goes). Obama also extended his support for the government's eavesdropping program as the spy bill passed the senate today. After the Supreme Court overturned the District of Columbia's gun ban, he said he favors both an individual's right to own a gun and government's right to regulate ownership and declared himself a "supporter of the Second Amendment". Obama also became the first major- party candidate to reject public financing for the general election after earlier promises to accept it. He not only embraced but also promised to expand Bush's program to give more anti-poverty grants to religious groups, a split with Democratic orthodoxy. The most surprising stand was when he objected to the Supreme Court's decision outlawing the death penalty for child rapists, drawing attention to his support for the death penalty if used only for the "most egregious" crimes.

With today's gallop poll showing Obama leading with just 48% - 43%, I think he may be risking his reputation for truthfulness. If he loses his reputation, he certainly does not have time to gain the voters trust with just 3 months before they go to poll.

Time to Wake Up Mr.PM

2008-07-01T13:11:00.000-07:00

India is a maze of conflicting rules, regulations and corruption that twists democracy to produce a constant squeeze on companies to appease the rules and tossing a bone here and there to the massive welfare state through taxation, employment demands and playing the old game of "west vs. east" in the political and economic arenas. I have always wondered what the current Congress govt has done for the last 4 years or so. I mean what is their real achievement. In a word, NOTHING. They can claim credit for a lot of things, but everyone knows that India's real so called economic boom started long before this govt took office.

The weak central government, which is run by an uneasy coalition between the Congress Party and the Left Front, is solely contributing to the unrest where prices are spiraling out of control and it is getting more and more difficult for the comman man to afford anything really. The inflation has jumped to 11.42% and the prices of food and manufactured products and the govt is unable to take any steps to control it...just blaming rising global oil prices. For five years starting from 2007, the Planning Commission has targeted Indian economy to grow at 9% with the last year delivering a growth of 10% . The current rise in inflation and high interest rates have already left a dent on the industry and the production growth rate of the country has substantially slowed down in the past four months. Inflation was at a modest 3% at the end of the year 2007, and is at present hovering over 11 per cent mark, the highest level in 13 years. This year the forecast for economic growth or GDP has been reduced to 7.3%.

The rising corruption is an new issue altogether that people are being forced to deal with. The 'India Corruption Study 2007', brought out by NGOs Transparency International India (TII) and Centre for Media Studies (CMS), found that about one-third of Below Poverty Line (BPL) households in the country bribed officials to avail a total of 11 services -- from police to PDS. According to the survey, which covered 22,728 households in all states and Union Territories, Rs 8,830 million (Rs 883 crore), in all, was estimated to be paid as bribe by BPL households last year. Its a shame that government officials take bribe from people who cant even make a decent living.

The Govt also has failed on the policy front. With the only aim of staying in power, the govt is totally dependant on all its so called coalition partners who all seem to be more keen on opposing everything that the govt does and threatening to pull out of the coalition. It is sad to see that the politicians are more keen to stay in the headlines rather than tackle the real problems that the country is facing. It has become amusing to read about the nuclear deal and what every party has to say about it. Indeed Mayawati from BSP took the cake when she said the deal is' Anti-Muslim'. Not sure what the deal has to do with religion but it proved there is no end in sight if Mr.Singh wants to please every tom dick and harry in the country before he actually acts. The PM, instead of leading the country is begging the various party leaders for permission to conduct the affairs of the state.

Time to wake up Mr.PM and do something real for the country, even if it means you lose support from your so called coalition partners. The drubbing you have taken in the last 4-5 states should tell you that people are in no mood to put up with the games the Congress is playing.

Talking about Inflation!!

2008-06-18T13:41:00.001-07:00

The Indian people and the government are both quaking with fear with inflation hovering at around 8%. The people can barely make two ends meet with prices soaring, and the government knows that if prices don't fall, the government will.

But India is not the only nation grappling with rising inflation. Even people from wealthy countries are crying everyday over ever increasing prices of bread and vegetables. However, they can all thank their lucky stars cause they are sitting pretty compared to Zimbabwe.

Do you guys want to even guess the inflation rate in Zimbabwe??

355,000%!

No, it is not a typo. The inflation in Zimbabwe for the month of March/April 2008 rose to 355,000%! Yes, 355,000 per cent! It more than doubled from the February/March figure of 165,000%. Currency traders ceased operations last week on Thursday and Friday because of the free fall of the ZWD and annual inflation certainly exceeded 2 million percent.

It is indeed a miracle that the Zimbabwean economy is still surviving as the prices seem to be rising to unprecedented proportions. Inflation surged between February and March following the sudden rise in money supply that flooded the economy to finance the 2008 elections.

The economy is in real free fall right now as inflation accelerates rapidly making life almost unbearable. It is predicted that by the end of the month, prices could be doubling everyday. Almost 80% of the nation is unemployed. The Zimbabwean central bank has introduced $500 million bearer cheques (or currency notes) for the public, and $5 billion, $25 billion, $50 billion agro-cheques for farmers. As the consequence of this devaluation, huge anomalies are developing in the system and prices, charges, service fees, etc can be dramatically lower than the next simply because the organizations have not had time to adjust their costings or figures.

Mr. Mugabe has certainly upped the ante by coming out and publicly saying he will not give up power even if he loses. He has openly promised 'War' if the opposition wins. That indeed poses serious questions as to weather the economy can be contained anytime soon. A sausage sandwich sells for Zimbabwean $50 million and a 15-kg bag of potatoes cost Zimbabwean $260 million.

Phew!!!

Indiana Jones and a Total Letdown.

2008-06-09T12:05:00.001-07:00

I watched Indiana Jones and the Kingdom of the Crystal Skull this weekend. I was really excited as the last weekend when I tried to go for the movie, it was sold out and this of course raised my expectations. As someone who grew up watching the first 3 Indy movies over and over again, I was totally thrilled and excited to be able to re-live a brand new adventure.

.....Boy, did it turn out to be a total letdown.

I must say i am still shocked to think that all that Steven Spielberg and George Lucas could come up with such a shallow story...and they took 19 years for this?? Don’t get me wrong, I am a big fan, but one cannot help thinking that after a classic like The Last Crusade (Which i still watch to date every 4-5 months), all they came up with was a cockamamie story involving aliens and the lost golden city of El Dorado. However, kudos to Harrison Ford who has proved he can still deliver even after almost 2 decades since he donned the famous hat. But there is not much he can do if the story is so weak. As for the Villain....Yawn!!!

The movie is watchable but provides no real excitement. Though there are some fun moments and chases, it never really got me hooked like the first 3 movies did. It was a weak movie strung together with some good sequences.. That’s the best way I can put it. For god's sake even Nicholas Cage's National Treasure kept me more engrossed. I hope the next time (If there is one), George Lucas finds something more interesting for Indy to go after. Sure the movie will be a money spinner, but I am keeping my DVD collection limited to the first 3 Indy movies for now.

Verdict: Sub-Standard but a total letdown for a Classic.

Bho Shambho

2008-06-08T14:01:00.000-07:00

Bho Shambho - Nice devotional song on Shiva. I tried to listen to this song online but found that its not available to listen to for free on most sites. So I am putting it up for everyone to enjoy!!!

Euro English!!!

2008-06-03T07:10:00.000-07:00

The European Commission has just announced an agreement whereby English will be the official language of the European Union rather than German, which was the other possibility. As part of the negotiations, Her Majesty's Government conceded that English spelling had some room for improvement and has accepted a 5-year phase-in plan that would become known as "Euro-English".

In the first year, "s" will replace the soft "c". Sertainly, this will make the sivil servants jump with joy. The hard "c" will be dropped in favour of "k". This should klear up konfusion, and keyboards kan have one less letter. There will be growing publik enthusiasm in the sekond year when the troublesome "ph" will be replaced with "f". This will make words like fotograf 20% shorter. In the 3rd year, publik akseptanse of the new spelling kan be expekted to reach the stage where more > komplikated changes are possible. Governments will enkourage the removal of double letters which have always ben a deterent to akurate speling. Also, al wil agre that the horibl mes of the silent "e" in the languag is disgrasful and it should go away. By the 4th yer peopl wil be reseptiv to steps such as replasing "th" with "z" and "w" with "v". During ze fifz yer, ze unesesary "o" kan be dropd from vords kontaining "ou" and after ziz fifz yer, ve vil hav a reil sensibl riten styl.

Zer vil be no mor trubl or difikultis and evrivun vil find it ezi tu understand ech oza. Ze drem of a united urop vil finali kum tru. Zen ve vil rul ze world!!

SriMan NaraYana

2008-05-31T06:38:00.000-07:00

SriMan NaraYana

Some Real Tounge Twisters!!!

2008-05-29T09:16:00.000-07:00

If one doctor doctors another doctor does the doctor who doctors the doctor, doctor the doctor the way the doctor he is doctoring doctors?Or does the doctor, doctor the way the doctor who doctors doctors?
A Tudor who tooted a flute tried to tutor two tooters to toot. Said the two to their tutor, "Is it harder to toot or to tutor two tooters to toot?"
A bitter biting bittern Bit a better brother bittern, And the bitter better bittern Bit the bitter biter back. And the bitter bittern, bitten, By the better bitten bittern, Said: "I'm a bitter biter bit, alack!"
A tree toad loved a she-toad Who lived up in a tree. He was a two-toed tree toad But a three-toed toad was she. The two-toed tree toad tried to win The three-toed she-toad's heart, For the two-toed tree toad loved the ground That the three-toed tree toad trod. But the two-toed tree toad tried in vain. He couldn't please her whim. From her tree toad bower With her three-toed power The she-toad vetoed him.
Silly Sally swiftly shooed seven silly sheep. The seven silly sheep Silly Sally shooedshilly-shallied south. These sheep shouldn't sleep in a shack; sheep should sleep in a shed.
You've no need to light a night-light On a light night like tonight, For a night-light's light's a slight light, And tonight's a night that's light. When a night's light, like tonight's light, It is really not quite right To light night-lights with their slight lights On a light night like tonight.
The twain that in twining before in the twine, As twines were intwisted he now doth untwine; Twist the twain inter-twisting a twine more between, He, twirling his twister, makes a twist of the twine.
If a Hottentot taught a Hottentot tot To talk ere the tot could totter, Ought the Hottenton tot Be taught to say aught, or naught, Or what ought to be taught her? If to hoot and to toot a Hottentot tot Be taught by her Hottentot tutor, Ought the tutor get hot If the Hottentot tot Hoot and toot at her Hottentot tutor?
Once upon a barren moor There dwelt a bear, also a boar. The bear could not bear the boar. The boar thought the bear a bore. At last the bear could bear no more Of that boar that bored him on the moor, And so one morn he bored the boar--That boar will bore the bear no more.
If you stick a stock of liquor in your locker, It's slick to stick a lock upon your stock, Or some stickler who is slicker Will stick you of your liquor If you fail to lock your liquor With a lock!
Mr Inside went over to see Mr Outside. Mr Inside stood outside and called to MrOutside inside. Mr Outside answered Mr Inside from inside and Told Mr Inside to come inside. Mr Inside said "NO", and told Mr Outside to come outside. MrOutside and Mr Inside argued from inside and outside about going outside or coming inside. Finally, Mr Outside coaxed Mr Inside to come inside, then both Mr Outside and Mr Inside went outside to the riverside.
We surely shall see the sun shine shortly. Whether the weather be fine, Or whether the weather be not, Whether the weather be cold Or whether the weather be hot, We'll weather the weather Whatever the weather, Whether we like it or not. watch? Whether the weather is hot. Whether the weather is cold. Whether the weather is either or not. It is whether we like it or not.
Mr. See owned a saw. And Mr. Soar owned a seesaw. Now See's saw sawed Soar's seesaw Before Soar saw See, Which made Soar sore.Had Soar seen See's saw Before See sawed Soar's seesaw, See's saw would not have sawed Soar's seesaw. So See's saw sawed Soar's seesaw.But it was sad to see Soar so sore Just because See's saw sawed Soar's seesaw

Oil - Up, Up and Away

2008-05-12T09:55:00.001-07:00

The price for a gallon of gas has been setting new record highs averaging around $3.7. Well, if you are in California, there is a good chance that you are paying more than $4 already. If all else is not enough, Goldman Sachs predicted on Tuesday that oil could soar towards $150-$200 a barrel because of a lack of adequate supply growth. Supply is up, demand is down, yet the price is soaring. So what is the deal with oil??

Crude prices have more than doubled in the last one year causing pain to millions around the world. Many analysts believe the dollar’s protracted decline over the past year has much to do with the doubling in oil prices since May of last year. Another school of thought thinks growing demand in rapidly developing countries such as China, Brazil and India, is the primary factor driving oil higher. Others have also attributed speculation in oil and a wave of fund money pouring into commodities, given the weaknesses in other financial markets.

What effect does the falling dollar have on the price of crude? Most oil price contracts are denominated in dollars. The dollar has fallen in value by more than 30 percent against a Federal Reserve index of major currencies since 2002. This means that the price of imports, including oil, have gone up. That brings us to speculation. Since September 2003, the total number of open crude oil futures and options contracts rose by 364 percent. Meanwhile the global demand for petroleum rose by just 8.2 percent. So the futures and options market has become more important than the physical supplies in driving the price. We are seeing investment flows into the oil market that don't have anything to do with the demand and supply of oil. Investors are treating oil as a hedge against inflation and a falling dollar. Oil markets are part of a negative positive feedback loop in which higher oil prices contribute to higher inflation, which in turn lowers the value of the dollar, which boosts oil prices, and so forth. In other words, the oil market is coming to resemble the gold market (which has also been soaring).

Economists also note that in the short run oil prices are very inelastic: A large change in price produces only a small change in demand. If the price of gas goes up a dollar per gallon overnight, you still have to fill your tank to get to work. However, over the long run, consumers and producers respond to higher oil prices. For example, Americans are driving less and have switched to buying more fuel efficient cars. Higher prices are no doubt encouraging innovation.
Oil companies have a two-pronged approach when it comes to innovation: seek alternative sources of energy that will both (1) reduce dependency on trouble-some, oil-rich nations and (2) utilize this energy in a manner that will still reap windfall profits. Although ideal in theory, it’s much tougher to implement in practice since renewable energies are just that - renewable. When products are renewable, profits go down since consumers purchase less. There is no doubt that several companies have already innovated alternative fuels, however these will take years before reaching a scale of production where profits can be made from them.

So what will happen to oil prices over the next few years? No one is predicting $10 per barrel oil. However, it sure seems to be the right time to give up that Hummer and switch to hybrids as this problem is not going away anytime soon!!

NY Mom

2008-05-11T19:45:00.000-07:00

And the Campaign Continues...

2008-05-07T07:48:00.001-07:00

It looks like the democratic primary race is over. After last night's overwhelming win in North Carolina and surprising close contest in Indiana for Obama, it looks increasingly difficult for Clinton to convince people why she is still running.

Oh..what a difference a week makes. April 28 was only last week but it feels like ages ago. That was the day Obama got hit by a one-two punch. First, his former pastor dominated the airwaves with his offensive rant. The same day brought news that Hillary had decided to join McCain in calling for a summer gas tax holiday, sure to be popular with voters angry about high costs at the pump. But in the end Obama seems to have come out on top as he took a more rational principal stand on the gas tax issue backed by the countries economists and made Clinton look like a political opportunist as she aligned with McCain.

Well, with only 6 contests remaining and a reducing pool of voters to help Clinton, there are potentially no more game changers left to turn the tide in her favor. Last night's results were decisive on their own: They offered Clinton her last, best chance to turn the tables on her rival, and she didn't even come close. To be sure, Obama is still struggling to win some demographic groups, notably blue-collar white voters, who are a key component of the Democratic base.

The pressure is on Clinton now to convince the super-delegates, who are the only ones who can change the game, why she is better than Obama. With a lead in pledged delages, popular votes, number of states won and caucuses, Obama seems too close to the finish line not to win the nomination. And last nights results diminished Clinton's rationale for urging Democratic superdelegates to override all his leads and give the nomination to her.

Well, the campaigns may continue, however it looks like the contest is over!!

Putting the Brakes on India's Growth

2008-05-02T09:21:00.001-07:00

India continues on its high-growth trajectory, with GDP expanding at or about expected rates. However, the economic data have weakened in recent months, causing worry for many people. This of course reflects the impact of the sharp appreciation of the rupee during 2007. The rupee has stabilized now, but other factors like high prices and rising commodities are starting to cause worry. It was widely agreed that RBI's policies for the last 2 years was based on the judgment that the Indian economy was overheating, as demonstrated by the 9% growth rate and higher inflation. However, the expected moderation doesn't appear to be too severe as the economy appears to be cooling, albeit from other concerns.

Sharp appreciation in the rupee in the first half of 2007 resulted in a significant decline in the growth rate of exports and the stronger rupee also contributed to the slowdown in industrial production during the second half of 2007. The currency has since stabilized, as the central bank has returned to its previous position of a tightly managed gradual appreciation. However, the overall economic situation has started to have its impact on what looked like India's once unstoppable economic growth.

However, even as growth slows, risks to inflation are still significant as a result of elevated global oil prices and, increasingly, rising global food prices. Its interesting to see that the central bank hasn't yet responded to the prospect of growth slowing to a level that might not be acceptable to below-trend level.

GDP growth reached a peak of 9.8% during 2006 thanks to strong growth momentum in services and industry. The services sector has been growing at a persistently high rate since the late 1990s, and the industrial sector has accelerated sharply from a relatively sluggish phase during 2003 and continued to gain momentum until 2006. However, after peaking in early part of 2007, industrial production decelerated steadily, which clearly seems to have translated into lower aggregate growth.

The difference between growth rates of GDP and industrial production is the result of continued momentum in the services sector, which has not displayed significant sensitivity to either rising interest rates or an appreciating currency. Changes in the macroeconomic environment have undoubtedly affected certain activities such as currency appreciation and growth slowdown in the services sector. However, the aggregate continues to grow at rates that reflect both expanding domestic demand and highly competitive exports. Agriculture also contributed significantly in 2007, which currently bodes well for food prices.

Rising Inflation Could Make It Difficult For The Reserve Bank To Cut Interest Rates - The economy's vulnerability has been highlighted as there has been a sudden change in food supply due to rising prices. Call from the CPI and Left to withdraw support to the govt (Again!!) has made many people sit up and realize the problem has gotten bigger than we would have liked it to. However, the combination of slowing growth and persistent inflation threats from the supply side, for both food and oil, poses a significant challenge to monetary policy.

The Rupee Will Continue To Appreciate, but gradually. The most significant development on the exchange rate front was the large and rapid appreciation of the rupee during the second quarter of 2007. This was followed by a change in the RBI's policy. Previously, the RBI accumulated the balance of payments surplus as foreign exchange reserves. But the inflationary consequences of persistent reserve accumulation in the face of a dramatic increase in the balance of payments surplus motivated the change in policy stance. A sharp surge in capital inflows early in the first half of 2007 made continuous RBI intervention unsustainable. As a result, the rupee rose at an uncontrolled pace in the second quarter of 2007. However, in the third quarter of 2007, the central bank seems to have reverted to its stance of controlled appreciation.

The Biggest Threats To India's GDP Are At Home. India may be the world's largest democracy. But it also comes with a costly tag of not being able to move quickly on taking decisions unless a consensus has been reached among all of India's political parties. This does put India at a big disadvantage as it almost always causes one to miss the bus and act only after the fact instead of being able to take decisions at the right time. Because of this it should be pointed out that domestic factors are the main cause of this deceleration. Because the recent growth has been driven by domestic factors, India is relatively insulated from a mild U.S. and global slowdown.

India's growth and GDP is expected to fall to 7.5%-7.8% in 2008 from the 8.7% growth it enjoyed in 2007.

H1-B (2009) - And the Rush starts now!!!

2008-03-10T09:25:00.001-07:00

Last year, the visa cap for H1B petitions was filled on Day 1. Though no numbers were released officially, it is estimated that USCIS had in fact received about 150,000 applications and thus resorted to ‘lottery’ (Random Selection) to pick up eligible applications. Many applicants had to wait longer just to know if their application was selected. Also, due to sudden rush, many had to wait for months to receive a status on their accepted application as well.

Now with just 2 more weeks left to go before USCIS accepts applications for 2009 H1B Quota, it looks like last years rush is about to repeat this year as well. Here are few things that may affect the drama this year and may change the stats a little bit.

Recession, Slowdown and Layoffs
It has already been widely acknowledged that the US economy is not in its brightest spot and we are already in a recession. Though some optimists are declaring just a slowdown, rest assured with recent announcements of another full percentage point rate cut looming and stagflation fears, the economy is in trouble. This puts direct pressure on all IT consultants and prospective H1B consultants for year 2008. Some may be reminded of the "dotcom" bust in 2001, where 1000s of IT consultants lost their jobs and had to leave for India after spending months searching for their next gig. For H1B consultants, this is a lot more serious issue, as if they loose their job or their project ends, they almost immediately have to leave US or be 'on bench' with no pay. Question is how long can people survive with either of those scenarios?

A Game of Chance...
Just like last year, it is almost certain that visa cap will be reached on day 1 and USCIS may again resort to ‘random selection’. That would mean, there is no guarantee and chances are completely based on luck rather than a consultant’s qualifications and specialization. Given here is a link with statistics released by USCIS as to the number of H1-B approvals for last year.
http://www.businessweek.com/table/08/0305_h1b.htm

New Competition for H1B Holders
July 2007 was a historic period of the year in the sense that in a sudden and surprise move, all visa status became current for green card applicants from India and almost all submitted their I-485 applications. All such applicants received EADs for themselves and their spouses. Spouses of many of these applicants who were on dependent visas like H4 became suddenly eligible to work without any restrictions. That brought in a totally new breed of workforce to the already downsized market for 2008. This additional supply of workforce surely puts more pressure in the job market especially when there are fewer jobs out there and now H1's are competing with EAD's.

Numbers this year...
The official H1B quota still stands at 65,000. There is no news about any possible increase and increases in caps looks unlikely with recession. The actual number of visas available is infact about 58,000 once you subtract the visas reserved for Singapore/Chile. For those who received or receiving Graduate Degree or any other Advanced Degree from US Universities, there is an additional quota of 20,000.

H1B Abuse - Yes it happens every year.
If you look at the statistics link above, it gives you an insight as to who is getting the most H1's. There is no doubt that the outsourcers are abusing the H1B visa program. Companies such as Infosys and Wipro are undermining the American economy by wiping out jobs. The companies bring low-cost workers to the U.S., train them in the offices of U.S. clients, and then rotate them back home after a year or two so they can provide tech support and other services from abroad. At the end of the day, an employee of Infosys or Wipro who manages to get a H1 stays in the country for maybe 2 years or so on an average of 6 years thereby denying the visa to someone graduating from an American university who truly needs the visa. The numbers released by USICS clearly shows the visa is not being used for what it was intended for. The outsourcing companies also prefer H1’s to L1’s or B1’s as once an H1 is stamped for an employee they can fly out overnight (whenever the client wants them onsite) and also there is less legal costs involved. Since their tactics have now been noted by USICS, it will be interesting to see if the outsourcing companies get the same number of approvals like last year.

Whatever the case may be, as the filing date approaches, the H1 B visa rush starts NOW!!!

The catch that won the Super Bowl!!

2008-02-04T12:01:00.000-08:00

I went to watch the super bowl at a friends place with mixed emotions. Of course as a new yorker there were no questions as to where my loyalties lie. But I was nervous thinking of the near perfect season that the Patriot's had so far coming in and it did bother me. They came in 18-0 and were going to be the only team since the dolphins to have a perfect season if they won...but destiny had other plans. Manning pulled off what was a miracle and by the end of the night, I was jumping, my adrenalin was pumping and boy what a victory it was.. It was without a doubt the best Super Bowl ever...I am sure the Miami Dolphins are popping the cork as well that their perfect season record is intact, but you have to hand it to Manning for coming through even after his ability has been questioned so many times in the recent past.

The game had everything — a first half filled with bullying defense and the best QB getting sacked so many times. But it was the final quarter which will be remembered as the giants 17-14 shock win changed the destiny of 2 people. Tom Brady - who was denied joining Joe Montana and Terry Bradshaw as the only quarterbacks with four Super Bowl rings and Eli Manning - Who now joins his brother and father to have the MVP titles in superbowls.

The best play were made in the last minutes of the games, when Manning threw the ball 32 yards, somehow after he miraculously spun away from what seemed to be the Patriots’ entire defensive line. With a touchdown catch in the books, Tyree went up high, two hands reaching, pulling the ball down on to his helmet, rerouting history and the Super Bowl XLII parade route, from Boston to New York (See pic for the winning catch).

Wanted: Jérôme Kerviel

2008-01-29T11:19:00.000-08:00

The elusive 31-year-old trader, Jérôme Kerviel, has given the slip to media from around the world pursuing the story of history's biggest trading misadventure. Kerviel has successfully shot from anonymity to international celebrity over the past week when Société Générale said he was behind a "massive fraud" that had cost it $7.1 billion. Internet search engines now turn up hundreds of thousands of entries bearing his name.

Although his photograph - a grainy mug shot - made the front page of papers around the world, Kerviel has managed to remain invisible. He has not spoken a word to the press and has kept journalists guessing about his whereabouts. No fresh photos of Kerviel have been published since the scandal broke. After police held him for nearly 48 hours, judges Monday threw out any fraud charges against him but did file preliminary charges - and he is free on bail while the investigation continues. Although hundreds of reporters are staking out all his known whereabouts, he has still managed to slip away unnoticed.

One thing is certain...an image of Kerviel will fetch "lots and lots of money" and he has propelled Soc Gen right to the No. 1 spot in trading disasters of all times.

As the bank continues to reel under sudden scrutiny, three employees at Societe Generale in Paris have alledgely committed suicide as fresh concerns are being raised about the stressful work environment at the scandal-hit bank. I guess when it rains, it always pours.

TOP 10 TRADING DISASTERS

Here's a league table of the biggest bank trading disasters of all time.
1. Societe Generale - $7.1bn (European index futures) 2008
2. Amaranth Advisors - $6.5bn (Gas futures) 2006
3. Long Term Capital Management - $4.6bn (Interest rate and equity derivatives) 1998
4. Sumitomo Corporation - $2.6bn (Copper futures) 1996
5. Bawag - $2.5bn (Currency and interest rate swaps) 2006
6. Metallgesellscahft - $1.6bn (Oil futures) 1993
7. Sowood Capital Management - $1.6bn (Debt securities)
8. Barings - $1.4bn (Nikkei futures) 1995
9. Credit Suisse - $1.3bn (Emerging markets) 1998
10. Daiwa Bank - $1.1bn (bonds) 1995

The Awakening...

2008-01-18T15:58:00.000-08:00

A time comes in your life when you finally get it -- when, in the midst of all your fears and insanity, you stop dead in your tracks and somewhere the voice inside your head cries out "ENOUGH!" Enough fighting and crying or struggling to hold on. And, like a child quieting down after a blind tantrum, your sobs begin to subside, you shudder once or twice, you blink back your tears and begin to look at the world through new eyes.

This is your awakening.

You realize it's time to stop hoping and waiting for something to change or for happiness, safety, and security to come galloping over the next horizon. You come to terms with the fact that you are neither Prince Charming nor Cinderella. And that, in the real world, there aren't always fairy-tale endings (or beginnings, for that matter). And that any guarantee of "happily ever after" must begin with you -- and in the process, a sense of serenity is born of acceptance. You awaken to the fact that you are not perfect and that not everyone will always love, appreciate, or approve of who or what you are...and that's OK. They are entitled to their own views and opinions. And you learn the importance of loving and championing yourself -- and in the process, a sense of new-found confidence is born of self-approval. You stop complaining and blaming other people for the things they did to you (or didn't do for you) and you learn that the only thing you can really count on is the unexpected.

You learn that people don't always say what they mean or mean what they say, and that not everyone will always be there for you, and that it's not always about you. So you learn to stand on your own and to take care of yourself -- and in the process, a sense of safety and security is born of self-reliance. You stop judging and pointing fingers and you begin to accept people as they are and overlook their shortcomings and human frailties – and in the process, a sense of peace and contentment is born of forgiveness. You realize that much of the way you view yourself and the world around you is as a result of all the messages and opinions that have been ingrained into your psyche. And you begin to sift through all the junk you've been fed about how you should behave, how you should look, how much you should weigh, what you should wear, what you should do for a living, how much money you should make, what you should drive, how and where you should live, who you should marry, the importance of having and raising children, and what you owe your parents, family, and friends. You learn to open up to new worlds and different points of view. And you begin reassessing and redefining who you are and what you really stand for. You learn the difference between wanting and needing and you begin to discard the doctrines and values you've outgrown, or should never have bought into to begin with -- and in the process, you learn to go with your instincts.

You learn that it is truly in giving that we receive. And that there is power and glory in creating and contributing and you stop maneuvering through life merely as a "consumer" looking for your next fix. You learn that principles such as honesty and integrity are not the outdated ideals of a bygone era but the mortar that holds together the foundation upon which you must build a life.

You learn that you don't know everything, it's not your job to save the world and that you can't teach a pig to sing. You learn to distinguish between guilt and responsibility and the importance of setting boundaries and learning to say NO. You learn that the only cross to bear is the one you choose to carry and that martyrs get burned at the stake. Then you learn about love. How to love, how much to give in love, when to stop giving and when to walk away. You learn to look at relationships as they really are and not as you would have them be. You stop trying to control people, situations, and outcomes. And you learn that alone does not mean lonely. You also stop working so hard at putting your feelings aside, smoothing things over and ignoring your needs.

You learn that feelings of entitlement are perfectly OK, and that it is your right to want things and to ask for the things you want -- and that sometimes it is necessary to make demands.
You come to the realization that you deserve to be treated with love, kindness, sensitivity, and respect -- and you won't settle for less. And you learn that your body really is your temple. And you begin to care for it and treat it with respect. You begin to eat a balanced diet, drink more water, and take more time to exercise. You learn that being tired fuels doubt, fear, and uncertainty and so you take more time to rest. And, just as food fuels the body, laughter fuels our soul. So you take more time to laugh and to play. You learn that, for the most part, you get in life what you believe you deserve -- and that much of life truly is a self-fulfilling prophecy.

You learn that anything worth achieving is worth working for and that wishing for something to happen is different from working toward making it happen. More importantly, you learn that in order to achieve success you need direction, discipline, and perseverance. You also learn that no one can do it all alone -- and that it's OK to risk asking for help. You learn the only thing you must truly fear is the greatest robber baron of all: FEAR itself. You learn to step right into and through your fears because you know that whatever happens you can handle it and to giving in to fear is to give away the right to live life on your own terms. And you learn to fight for your life and not to squander it living under a cloud of impending doom.

You learn that life isn't always fair, you don't always get what you think you deserve, and that bad things sometimes happen to unsuspecting, good people. On these occasions you learn to not personalize things. You learn that God isn't punishing you or failing to answer your prayers. It's just life happening. And you learn to deal with evil in its most primal state -- the ego.

You learn that negative feelings such as anger, envy, and resentment must be understood and
redirected or they will suffocate the life out of you and poison the universe that surrounds you. You learn to admit when you are wrong and to build bridges instead of walls. You learn to be thankful and to take comfort in many of the simple things we take for granted, things that millions of people upon the earth can only dream about: a full refrigerator, clean running water, a soft warm bed, a long hot shower.

Slowly, you begin to take responsibility for yourself by yourself and you make yourself a promise to never betray yourself and to never, ever settle for less than your heart's desire. And you hang a wind chime outside your window so you can listen to the wind. And you make it a point to keep smiling, to keep trusting, and to stay open to every wonderful possibility.

Finally, with courage in your heart and God by your side, you take a stand, you take a deep breath, and you begin to design as best you can the life you want to live.

Nano: The World's Cheapest Car

2008-01-10T08:10:00.001-08:00

Tata Motors today took the covers off the world’s cheapest car — the Nano. Over the past year, Tata has been building hype for a car costs a mere 1 Lakh (roughly $2,500). Since the name was unveiled only today, it has been popularly dubbed the “People’s Car.”

The car will have a 624-cc petrol engine generating 33 bhp of power. It will sport a 30-litre fuel tank and 4-speed manual gearshift. The car will come with air conditioning, but will have no power steering. It will have front disk and rear drum brakes. The company claims mileage of 23 km per litre. The car's dashboard features just a speedometer, fuel gauge, and oil light. The car does not have reclining seats or radio. The shock absorbers are basic.

Nano, the world's cheapest car, costs almost half of the cheapest car currently available anywhere in the world. Some analysts have criticised the car as they feel a lot of safety features have been comprimised. Compare with most cars where even the basic safety features cost over $2500.

The Nano is expected to be commerically launched in the second half of 2008. Not since the launch of the Maruti 800 in 1983 has any car gripped the imagination of a nation and indeed car manufacturers the world over so intensely. If commercially successful, the Tata Nano can alter the passenger car market in India, and perhaps the world, beyond description.

Is the Sun(TV) beginning to set?

2008-01-03T13:04:00.000-08:00

OK. OK. This maybe up for debate, but whats going on with Sun TV??
I watched Sun TV over the last couple of weeks while I was in India and I must say all the programs are really bad…terrible to say the least. I could not watch for more than an hour. Every program on Sun TV seems to be copied (very badly) from some other channel (read Vijay) and what surprised me was I was seeing the same people who appeared in the originals.

Kalaka povadhu yaaru from vijay tv has become Asatha povadhu yaaru on sun tv,
Jodi no. 1 from vijay tv has become masthana masthana on sun tv (Incidentally Jodi no.1 season 2 became masthana masthana 2 (what did you expect) and Coffee with Anu from vijay tv has Anbudan (which was scrapped as there was no takers (surprise surprise) on sun tv and the list goes on.....

Kailaignar tv and Jaya tv seem to have the required party backing and vijay tv has all the talent. Sun tv seems to be left out in the cold and seems to be running out of options. Sun TV is running so low on creativity and seems to be satisfied with just blatantly ripping off other shows. The problem is however, they are doing a bad job at it. The only thing going for it is no doubt the mega-serials which it solely seems to be relying on. Sun TV has even poached the same artistes from the Vijay TV Show and roped in one of the judges (Madan Bob) for Asatha povadhu yaaru.
But what makes you realize that the sun is setting without a doubt is that for each show, they keep proclaiming and make every artist/contestant say that sun tv is the greatest channel and their shows are the best on this planet.

Talking about SUN news…well that’s another story altogether (it is so bad, does not even deserve to be written about)

Interestingly the stock has plummeted by over 50% over the last 8-10 months sending a strong message to the management. It has been a long time since they did anything revolutionary and if they don’t get their act together soon, the sun is not coming up anytime soon after it sets.... or in other words, start shorting.

American Gangster

2007-11-14T08:14:00.001-08:00

This past weekend, I watched American Gangster. Though I had seen the previews earlier, I had no expectations going in, and I must say I was pleasantly surprised. It was a gripping movie and it certainly had my attention for over two and a half hours.

The biopic movie, about the real life gangster Frank Lucas and Detective Richie Roberts, is definitely worth a watch. It is set in the 1970’s New York underworld. The film explores the rise and fall of Lucas who also happens to be the guy who was above the Italian mafia at that time. Meanwhile, throughout Lucas’s rise, an outcast cop named Richie Roberts begins to put the pieces together and discovers that Lucas is the next big crime boss and at all costs wants to and manages to bring him down. A great gangster film ensues!

I am sure all of you can read the reviews of the movies online, but what intrigued me about the movie was the irony of both characters. Their professional and personal lives are flipped. Frank does dishonest things for a living at every turn, but in his personal life lives by a strict moral code of humility, honesty, church and family. Richie is a painfully honest cop, but his personal life is a garbage dump of lies, failed relationships, prostitutes and insecurities.

The movie did get me curious and I did do some looking around to see the kind of life the real Frank Lucas and Richie Roberts are leading today… and believe it or not, they are good friends today. It was one of those movies that I was thinking about the next day (rarely does that happen :)

Anyways, for those interested in looking/reading about the real American Gangster, here are some interesting links

http://nymag.com/nymetro/news/people/features/3649/

http://www.cnn.com/2007/SHOWBIZ/Movies/11/09/film.real.americangangster.ap/index.html
http://www.daylife.com/topic/Frank_Lucas

And watch this video

http://www.charlierose.com/guests/richie-roberts

The Shrinking Economy

2007-11-13T13:37:00.000-08:00

The U.S. economic data seems to be coming in much stronger than expected. Real GDP rose 3.9% in the second quarter and payrolls jumped 166,000 in October. Does this mean the economy is ignoring the housing problems and energy prices, or does it just mean that the eventual decline will be even worse?

The Federal Reserve's quarter-point interest rate cut on Oct. 31 suggests that they believe the worst is yet to come. Whether the economy is moving towards a slowdown or turns into a recession depends on three factors:

Can consumers continue to ignore energy and home prices?
Will the current problems in financial markets extend the downturn beyond housing into other sectors, especially commercial construction?
Will overseas economies continue to grow and buy more U.S. goods?

The higher oil price does raise the probability of recession. Three consecutive quarters of growth near or less than 1.5% mean that a negative quarter is very likely but lets hope with luck there won't be two in a row.

SPENDING SPREE

The ability of the American consumer to keep on spending continues to surprise pretty much one and all. Consumer spending again rose at a 3.0% annual rate in the third quarter, rebounding from a slow 1.4% in the second quarter. The saving rate rose to 0.9% in September. So far, however, it is clear that consumers have no doubt been living up to—if not beyond—their incomes.

Even more important is the rise in oil prices, which is squeezing consumer buying power. Oil hit $97/barrel on Nov. 6. It is widely being forecasted that the price will retreat to $85/barrel over the next few months. Although the underlying supply and demand conditions suggest that prices should be lower, worries about the middle east, problems between Turkey and the Iraqi Kurds, with President Musharraf in Pakistan, and with Iran all add to fears of supply disruption
The risk of further price hikes is clearly very real, and these could further squeeze consumers.
It is expected to slow, but not stop consumer spending.

GLOBAL EFFECT

The major area of strength for the U.S. economy is foreign trade. The widening trade gap had been a drag on GDP over the last several years, but it has been improving since last January. U.S. growth has slowed, slowing imports, while growth overseas has remained stronger. The falling dollar has also helped boost exports. Over the last four quarters, the improvement in the real trade deficit has added 0.75% to real GDP, accounting for 30% of the 2.6% real GDP growth.
Asian growth appears solid. Chinese GDP is set to climb 11.5% this year, with Indian real GDP set to touch 9.5%. Some slowdown in both is likely next year, but China's should remain in the double digits. The developed countries are doing less well. Europe is slowing, in part because the strength of the euro hurts exports and U.S. growth is slower. Japan's real GDP fell in the second quarter but should rebound in the third. One advantage for the rest of the world is that the U.S. slowdown has been concentrated in residential construction. Because residential construction has a relatively small import component, the effect on exports from Asia and other markets has been much less than if it had been concentrated elsewhere.

There has been a lot of talk about the decoupling of the world economy. That metaphor is incorrect. The world is more tightly coupled than it has ever been by financial and trade flows. The difference is not that the train has come uncoupled but that the train has more engines pulling it. A decade ago, the U.S. was 23% of world GDP in terms of purchasing power and accounted for about the same percentage of world growth. Today, the U.S.'s share of world GDP has shrunk to 20%, and it accounted for only 12% of 2006 growth. China, in contrast, has risen to 15% of world GDP and 30% of world growth.

Oil prices are a problem for other countries besides the U.S., but there is a critical difference between a rise in oil prices caused by stronger demand and higher oil prices caused by supply disruption. When demand pulls oil prices, the higher costs to the oil importers are balanced by higher income for oil exporters, who either spend the money or invest it. This recycling of petroleum revenues helps keep the world economy going despite higher costs. It is not a perfect balance, and it has contributed to the problems of excess liquidity that has inflated bubbles around the world, but it is better than the alternative.

The dollar is of course going to continue to fall. The current account deficit, although it has shrunk, remains very wide at 5.5% of GDP in the third quarter. In the last two years, the inflow of capital seeking higher yields in the U.S. offset this. But a year ago, U.S. Treasuries were trading a percentage point higher than equivalent European government bonds. Today, that spread has shrunk to only 15 basis points (bps). In addition, foreign investors are worried about the dollar decline, making European investments look like a better bet. August was the first significant outflow from the U.S. financial markets in over five years; it will continue.

Fed’s work is cut out

The Federal Reserve has cut interest rates twice already, by a total of 75 bps. The Fed statement was tough, but no one is denying the weakness in the economy and it is likely to force another rate cut, most likely early next year. The Fed is right to be concerned about inflation, especially given the falling dollar and its impact on consumer prices. But in the short run, recession is the bigger risk. Even if there were no election in 2008, the Fed would have to focus on real growth—at least for a few quarters.

The Magic of Math

2007-10-31T13:02:00.000-07:00

Check this out......
1 x 8 + 1 = 9
12 x 8 + 2 = 98
123 x 8 + 3 = 987
1234 x 8 + 4 = 9876
12345 x 8 + 5 = 98765
123456 x 8 + 6 = 987654
1234567 x 8 + 7 = 9876543
12345678 x 8 + 8 = 98765432
123456789 x 8 + 9 = 987654321

Now Look at this ......
1 x 9 + 2 = 11
12 x 9 + 3 = 111
123 x 9 + 4 = 1111
1234 x 9 + 5 = 11111
12345 x 9 + 6 = 111111
123456 x 9 + 7 = 1111111
1234567 x 9 + 8 = 11111111
12345678 x 9 + 9 = 111111111
123456789 x 9 +10= 1111111111

What do you think now ......
9 x 9 + 7 = 88
98 x 9 + 6 = 888
987 x 9 + 5 = 8888
9876 x 9 + 4 = 88888
98765 x 9 + 3 = 888888
987654 x 9 + 2 = 8888888
9876543 x 9 + 1 = 88888888
98765432 x 9 + 0 = 888888888

And Finally.....
1 x 1 = 1
11 x 11 = 121
111 x 111 = 12321
1111 x 1111 = 1234321
11111 x 11111 = 123454321
111111 x 111111 = 12345654321
1111111 x 1111111 = 1234567654321
11111111 x 11111111 = 123456787654321
111111111 x 111111111 = 12345678987654321

Rise of the Oil Barrel

2007-10-18T13:02:00.001-07:00

The price of crude oil has been on a roller-coaster ride, hitting a record $89 per barrel in October before drifting back a little as I write this. And, in the past year, oil has been as low as $50 per barrel. One could argue that the economics of supply and demand would imply a drop in prices as the global economy becomes more energy-efficient and economic growth slows in much of the industrial West. But demand elsewhere and the politics of the Middle East and other oil-producing regions suggest that prices could just as well rise sharply. When Goldman came out with a report last year that oil prices will touch $120 per barrel, Wall Street seemed to laugh it off. Now…not so anymore. With Turkey voting for military incursions into Iraq and the continuing dollar slide with no recovery in sight, well, it might just happen.

The one certainty is continuing uncertainty. Oil prices will probably remain volatile, creating problems not only for the global economy but also for the industrial sectors that are heavy users of crude and refined products, especially airlines, chemicals, electrical utilities, and freight transportation. The worldwide demand for oil will no doubt increase rapidly over the long term because of the strength of the Asian economies. Chinese energy use continues to grow at a double-digit annual pace, and China is rapidly catching up with the U.S. in total energy consumption. India is smaller in terms of total GDP and energy usage, but its appetite for oil is growing nearly as rapidly. So, even with a weaker U.S. economy and sluggish growth in Japan and Europe, energy demand should eventually rise. Although the developed countries can probably hold energy use constant, rolling it back is difficult. The lack of compliance with the carbon emissions goals set forth in the Kyoto accords proves that it is not easy to walk the walk.

The demand side is only half of the equation, however. The other is supply. Oil's role as a financially traded instrument may have exploded in the past few years, but ultimately, it's still a physical commodity. Finding oil and natural gas is becoming more and more difficult. Exploration companies have already looked in the easy places. Now they're eyeing sites that are more difficult to operate in, either politically or geographically. Deep-sea deposits can be tapped, but at a high price. How far and fast energy prices will rise is uncertain, but the direction seems all too clear.

Memories...

2007-10-10T17:15:00.000-07:00

Dear Tech Support

2007-09-28T09:02:00.001-07:00

Email to Tech Support

Dear Tech Support,
Last year I upgraded from Boyfriend 5.0 to Husband 1.0 and noticed a distinct slow down in the overall performance, particularly in the Flower and Jewellery applications, which operated flawlessly under Boyfriend 5.0.

In addition, Husband 1.0 un-installed many other valuable programs, such as Romance 9.5 and Personal Attention 6.5 and then installed undesirable programs such as: Football 5.0, Rugby 4.3 and Cricket 3.0. Conversation 8.0 no longer runs; it simply crashes the system. I've tried running Nagging 5.3 to fix these problems, to no avail.

What can I do?

Signed,
Desperate

Reply from Tech Support

Dear Desperate,
First keep in mind, Boyfriend 5.0 is an Entertainment Package, while Husband 1.0 is an Operating System.Try entering the command: C:/I-THOUGHT-YOU-LOVED-ME to download Tears 6.2, which should automatically install Guilt 3.0. If that application works as designed, Husband 1.0 should then automatically run the applications Jewellery 2.0 and Flowers 3.5. But remember, overuse of the above application can cause Husband 1.0 to default to Grumpy Silence 2.5, Happy Hour 7.0, or Beer 6.1. WARNING: Beer 6.1 is a very nasty program that will create Snoring Loudly.

CAUTION: Whatever you do, DO NOT install Mother-in-law. This is not a supported application and will crash Husband 1.0.In summary, Husband 1.0 is a great program, but it does have limited memory and cannot learn new applications quickly. You might consider buying additional software to improve memory and performance. I personally would recommend Hot Food 3.0 and Lingerie 7.7.

Good Luck,
Tech Support

Ram Sethu – The bridge under shallow waters

2007-09-27T12:28:00.000-07:00

Adam's Bridge a.k.a Ram Setu both meaning "Rama’s Bridge" in India, is a chain of limestone shoals between the islands of Mannar and Ramesharam. There is enough geological evidence to indicate that this bridge acted as former land connection between India and Srilanka. The bridge consists of a series of parallel ledges of sandstone and conglomeration, that is hard at the surface and grows coarse and soft as it descends to sandy banks. In the 19th century, there were two prevalent theories explaining the structure. One considered it to be formed by a process of accretion and rising of the land, while the other surmised that it was formed by the breaking away of Sri Lanka from the Indian subcontinent.

The Project
First conceptualized in 1860 and finally after fourteen proposals and 144 years, the Indian govt. approved a multi-million dollar project which is called the ‘Sethusamudram Shipping Canal Project’. The purpose of the project is to create a shipping channel across the straight. The plan is to dredge the shallow ocean floor to create enough leeway allowing ships to pass through the channel instead of having to go around Sri Lanka.

What is the Issue?
Though there are arguments for and against the project – which have their own merits, there are various fundamental issues which are not yet addressed by the government.

Arguments for the project include boosting international trade by saving nearly 30 hours' shipping time by cutting over 400 km off the shipping voyage (as the ships don’t have to go around Sri Lanka anymore). Since the government is unable to prove any real benefits, its argument primarily centers on just a single point – a perceived future economic boost and strengthening the Indian Navy. Considering the cost of the project, which is a whooping 2600 crores, it seems a bit premature with to go ahead with so many unknowns.

Arguments against the project also give us some real issues to think about. The opposition against the project voices concerns related to its impact on the environment and damage that will be caused by dredging the area. Also, potential loss of Thorium deposits and increased risk of damage due to future Tsunamis is something that cannot be overlooked. The opponents, of which, there are many also claim that it will cause tremendous damage to the local ecology, marine wealth and affect the livelihoods of the fishing communities along the coasts of southern India and Sri Lanka. Besides, they say, no one is quite sure where the Indian government will put all that sand and silt it digs up.

The Religious Angle
There are millions who believe that the Ram Setu was actually the bridge built by Lord Ram with the help of Hanuman and his friends using floating stones and Rama’s army marched over this bridge to destroy the evil regime of Ravana. Apart from the Ramayana, the Mahabharata also refers to the continued protection of Nala Setu following Lord Rama's command. Kalidasa's Raghuvamsham also refers to the Setu. So does the Skanda Purana (III 1.2.1-114), the Vishnu Purana (IV 4.40-49), the Agni Purana (V-XI), the Brahma Purana (138.1-40). No one can doubt the religious significance that Ram Setu has in Hinduism.

Picture Taken by NASA

The Political Angle
The Centre has told the Supreme Court that while filing an affidavit, that there is no evidence to prove the existence of characters or events in the Ramayana and the Ram Sethu is not a man-made structure. The govt took a stand that since it is only a natural formation, it could be demolished and the canal can be built. This sparked off a controversy of mammoth proportions as the Center was seen questioning the existence of Lord Ram. DMK’s chiefs comments that Ram did/never existed made this worse embarrassing the government and pitted the rest of the country against TN.

The UPA been unable to convince the anti-Sethusamudram groups on any count. Its assurances and denials and justifications have only made matters worse. At the same time, since it needs the support of the DMK, it is trying to pacify one and all. In the recent days, the matter took an uglier turn when DMK activists attacked the TN BJP headquarters and injured BJP party men. The Congress for its part is trying to distance itself from the DMK and its statements.

Whether it was a natural formation or really built by Lord Ram one will never know and one can never prove otherwise, but either ways the Ram Setu is undoubtedly considered by millions to be a part of Indian heritage and preserving it should be on the mind of every Indian. While even the Christians and Muslims in India have never questioned it, it is sad to see our politicians making a mockery out of it.

Given below are statements made by our politicians.

Karunanidhi: "Some say there was a person over 17 lakh years ago. His name was Ram. Do not touch the bridge (Ram Sethu) constructed by him... From which engineering college did he graduate? Is there any proof of this?"

Vilas Vedanti: “Fatwa against Karunanidhi”

Rajnath Singh: ``Given the manner in which the relationship between the Congress and the Left Front is increasingly getting strained, it clearly indicates that Lok Sabha elections are no longer far away,’’

Jayanti Natarajan: "The BJP is in the midst of an existential crisis. The lotus is wilting. They are not just downwardly mobile, they are in an irreversible decline”

One thing is clear, the common man is not being heard.

123...Go!!!

2007-09-13T12:52:00.000-07:00

Congress: We need this deal for India. We figured after 60 years of sitting around, its time to finally do something for India.
BJP: We will oppose the deal..Till we come back to power
Left: We want India to be left behind
Kalam: Can I still be president..Please??
Chinese: Wow, these Indians have negotiated a better deal than us, lets oppose them and create some confusion. Call our friends at the CPI.

As opposition to the Indo-US nuclear agreement grows, one wonders if we are our own worst enemy. The problem is the Communist parties in India are fundamentally against any business with the US/West and its got to a point where they are making India look ridiculous. Sure India is a democracy while gives all parties a voice, but the left has successfully turned the proceedings into a circus by threatening the Congress every other day. BJP, for its part is playing the perfect opposition by opposing the deal simply becuase they have to (and asking the govt to re-negotiate) and brainstorming any way in which they can take some credit as well.

The snap polls conducted all over the country clearly proved that the people of India have endorsed this deal and that the vast majority of both the Indian elite and middle class are very much in favor of not just a normalization of ties with America but also favor a much more comprehensive strategic partnership. From the American side, both the Democratic and Republican parties see a partnership with India as one of the priorities of US foreign policy no matter which president is sworn in.

While Abdul Kalam has reviewed and blessed the deal as a step forward for India, I fail to understand why the left is continuing to make noise which can only lead to further isolation. In today’s ever changing global dynamics, every political party must, in the national interest, ensure that we are ready to meet the emerging global challenges consistent with our national self-interest. India needs to establish friendly relations with key global players: the USA, Russia, China, Japan, Germany, France, UK, Brazil etc. Sure we are growing at a double digit pace and every country is looking to India to grow and expand. But are we a true global player yet?? The answer would be a resounding ‘NO’. We do have the potential to become one, but it is indeed sad to see that just when we have gotten our foot in the door, the rug is being pulled once again by our politicians.

Anyone who has carefully read the entire deal will know that the deal is tipped in India’s favor and the fact is the US has indeed given a lot of concessions to bring India on board (esp. for a country which has not signed the CTBT).

Although uranium is the only naturally occurring fissile element directly usable in a nuclear reactor, India has only 0.8% of the world’s uranium reserves and may have to depend on imports in the future. Sure this is a genuine concern which can be addressed, but India is investing and building a prototype thorium reactor so it does not have depend on imports in the future (India has 32% of world’s thorium reserves). I also fail to understand why is it one or the other. The fact is currently our nuclear reactors are running at below 60 per cent capacity due to the shortage of nuclear fuel and this deal is critical for India's energy sector. It could be decades before we even come close to indigenously developing reactors to harness energy contained in non-fissile thorium.

We simply cannot afford to miss the bus on this deal and risk getting isolated or worse lag behind in comparison to other developing countries becuase all our politicians are interested is in getting one up on each other. While Japan, UK, Russia and France have recognized the importance of this deal and have already shown confidence in India, it is strange to see our left parties shouting ‘Down with US-Imperialism’ and opposing the deal for no rhyme or reason. (While most of their children are in the US)

Let there be no doubt that the 123 agreement with the US will allow India to become a global player in a competitive world and will no way impact its sovereignty in any way. The deal sure has had some bumps along the road, but its success is inevitable given the strength of momentum with US-India relations which is at an all time high.

The Politics of Economic Policies

2007-09-06T09:40:00.000-07:00

India has had an unprecedented stretch of growth over the last four years, averaging over 8% per year. Inflation was relatively low in the early part of this period but has picked up recently, thanks to demand-side pressures. RBI began a monetary tightening cycle in late 2004 and has maintained this stance in its quarterly announcements. However since 2006 — along with increases in its benchmark rates, the bank has been using the cash reserve ratio as an additional instrument to control surging liquidity. This liquidity can be mainly attributed to high capital inflows, which have risen significantly over the past few quarters and are flowing into equity, corporate debt, and remittances from NRI’s (which seem quite unstoppable now).

By 2007, RBI has abandoned its currency management regime, which had resisted appreciation. The bank is now allowing the Indian rupee (INR) to more accurately reflect the balance of payments surplus. The currency has responded sharply to this tactic, appreciating by almost 10% over the last three months.

Growth, Despite Rising Interest Rates
As the Chart indicates below, the economy grew at 9.4% in fiscal 2006-2007 (April-March), spurred by a steady acceleration in the manufacturing sector. Industrial production grew at a double-digit pace over the last few quarters, a pattern that is inconsistent with the steady increase in benchmark interest rates over the same period. In fact, much of the growth momentum was provided by sectors such as construction and automobiles, which are recognized to be relatively sensitive to interest rates. This indicates the ineffectiveness of tightening monetary policy, which depended entirely on hiking interest rates. The banking system was able to offset the central bank's rate increases with the huge increases in liquidity from high capital inflows. Only when the bank implemented direct measures—the cash reserve ratio—to rein in liquidity in late 2006 did lending rates begin to increase.

The impact of these recent moves is only just beginning to become visible. Industrial production numbers for the initial months of the current fiscal year (April 2007-March 2008), while still showing high growth in the aggregate, clearly point to a slowdown in some critical sectors—automobiles and metal products, in particular. It also reflects long-term optimism about business conditions, even as the immediate future looks a little less bright than in 2006-2007. Meanwhile, the services sector, the largest and fastest growing segment of GDP, shows every sign of maintaining its momentum.

Yes - Export Growth is Slowing

The Chart below displays the rather dramatic impact on export growth (in rupee terms) as a result of the rupee's sharp appreciation over the past few months. This rate of growth is relevant in measuring the top-line impact of appreciation on exporters. Of course, businesses dependent upon imported material clearly benefit from this development, but the combined impact on exporters and domestic producers of importable goods is likely to significantly reduce aggregate demand, thereby contributing to the soft landing.

The reason the central bank abandoned its protection of an undervalued exchange rate was that it was becoming impossible to offset the expansion of money supply that resulted from foreign exchange reserve accumulation. The RBI realized that it cannot buy $$ at the same pace that $$ was flowing into the country. The impact of an appreciated rupee will no doubt linger for some time to come, while exporting and import-substituting businesses are forced to take immediate actions to improve productivity. Short of a massive crash in the equity markets that provokes a sustained exit of foreign investors, the rupee is unlikely to depreciate from current levels. The only question is whether it will have an unrestricted rise or if RBI will step in to attempt a more gradual and stable appreciation.

Time to Relax??

Based on the current dynamics of the Indian economy, GDP growth during 2007-2008 will drop from last year's 9.4% to around 8.5%. Given the likelihood of a neutral monetary stance over the next few quarters, growth during fiscal 2008-2009 should accelerate somewhat to the 8.5%-9% range. There is always a risk in the form of market turbulence and rising oil prices, both of which could prove to be destabilizing. At this point, however, their significance is not great enough to offset the strong fundamentals underlying the recent surge in growth.

There should be no surprises in inflation and it is also likely to hover around 5% during 2007-2008. Pressure on the rupee to appreciate continues under this scenario, as capital inflows more than offset a potential current account deficit. The risk here is from global market turbulence, which if severe enough, could even reverse the trend in the rupee. If this risk does not materialize, the rupee will appreciate in a managed way and everyone should be prepared for the Rupee to stay at the 39-40/1 mark with the $$ for a long time to come

Fed: To-Do or Not-To-Do

2007-08-16T12:06:00.000-07:00

The US Economy has a Cold...So What???

So the million $$ question is ‘What is the Fed going to do?’ Are they going to lower interest rates or keep them steady?? Are they going to sit back and let billions be shaved off or are they going to try and control the financial markets. Anyone who has been watching their investments, the stock market and major indexes must be having a panic attack right about now. As the weather has heated up in the summer, the economy seems to have cooled.

Problems in the credit markets are translating into fears for consumer spending as well as increased worries about housing. All headlines keep talking about subprime and credit fears. So the bigger question is ‘Is there a real reason to be worried??’ If so, when should we start to worry or has that train already passed. Lets see, the 3% growth rate of the past four years has slowed to 1.9% over the last four quarters.

The economic weakness also changes the outlook for interest rates. Both the European Central Bank (ECB) and the Federal Reserve (Fed) have added reserves last week, with the ECB doing most of the work.

So, What’s up with the Housing Market?

Continued declines in home sales show that the housing market is under severe pressure. However, this remains only a mild housing recession by historical standards. It is the first major housing downturn in the U.S. since 1991-1992, so it seems more severe than it is and everyone is pushing the panic button, but one has to remember that real housing recession cycles tend to be dramatic, as major recessions have shown declines of more than 50%. It is indeed interesting that in the 2001 recession, the Federal Reserve's sharp interest rate cuts kept the housing market strong and this time around they are playing the waiting and watching game.

Also, remember that the sharp rise in home prices is a worldwide phenomenon, spurred by low interest rates. As I write this India has started to build million dollar homes in various cities and they are sold out even before a single brick has been laid. To most buyers, the price of a home is essentially the monthly payment, and with U.S. mortgage rates at so low in 2002-2003, Americans could buy a lot of home for only a small monthly payment. But as interest rates rose with the Fed tightening, the monthly payments increased, and homeowners who were selling found that prospective new buyers couldn't pay as much. Some homebuyers dropped out as a result and the homeowners who wanted to sell had to reduce the home prices in order to sell.

Trade Deficit is Shrinking

On the trade front, the deficit has been shrinking slowly since its October 2005 peak of $67.1 billion, to $60.0 billion in May and an average of $59.1 billion for the first five months of 2007. The trade deficit has narrowed in response to three major changes: the fall in the dollar, the weaker U.S. economy, and stronger overseas growth.

The weaker dollar is clearly part of the reason for the improvement. The first impact of a weaker dollar on the deficit comes from higher import and lower export prices, which tend to worsen the deficit in the short term. Only in the longer run do higher export and lower import volumes offset this price effect. The second major change contributing to a smaller trade gap has been the softening of the U.S. economy. As growth slowed to 2% from 3%, demand for imports cooled as well. The third factor is the continued improvement in the world economy, particularly in Asia, Japan and Europe. In 2005, the Eurozone's GDP rose a meager 1.6%; this year, its going to be almost 3%. Similarly, Japanese growth was 1.9% in 2005, and it is 2.3% this year and Asia’s well, I don’t have have to say (considering China and India have been continually posting double digit growth numbers). These figures are especially important because the U.S. exports mostly to the industrial countries, while it imports from non-Japan Asia and the Americas.

Federal Deficit has Fallen

The decline in the federal deficit has been a major surprise to one and all. The gap is expected to be $179 billion in fiscal 2007 (down from $428 billion in fiscal 2002), which is only 1.6% of the U.S. GDP. Strong revenues—not less spending—have narrowed the deficit because government spending rose faster than GDP over the past four years. Spending may slow if there is a decline is military spending (The generals are planning a troop reduction in Iraq as I write this). However, the budget deficit should remain near its current level for the next few years.

State and local governments are healthy, again largely because of strong revenue growth. The aggregate of all state and local budgets have moved back into surplus on an operating basis.

Economy and Inflation

The inflation rate is running at a relatively moderate level. The Fed's preferred measure—the consumer expenditures price index excluding food and energy items—was up only 1.9% from a year earlier in June, which is definitely within the Fed's comfort zone. The Fed remains nervous about inflation (well, they better be as I don’t want to pay 10 bucks for a gallon of milk). One worry, however, is that the downward revision to real GDP growth in the most recent data implies that productivity growth has been running about 0.25 percentage points lower than previous projections, which would reduce the estimated trend growth for the economy to about 3% from the 3.25%. This would also unfortunately revise costs higher, suggesting more inflationary pressure.

The spread between U.S. and European bond yields has narrowed too much and seems too low to attract the funds needed to finance the U.S. trade gap. So I think we can safely say that our German and British friends are not going to be buying US bonds anytime soon. The 10-year U.S. Treasury note is yielding only 0.46 percentage points more than the equivalent Euro bonds, which is less than half of last year's spread. U.S. yields are likely to rise in response to the higher European yields, even if the Fed begins to cut short-term rates early next year.

The economic expansion has slowed, which should not be a surprise after 17 consecutive Fed rate hikes. The growth remains solidly positive, resembling the 1995-1996 period, when real GDP fell back to 2% for a year and then reaccelerated. So far, the slowdown is mostly confined to the housing market, with the consumer continuing to spend confidently. However, the risk remains that higher oil prices or a sharper rise in bond yields, which could in turn further damage the housing market, might still turn lower growth into a recession.

The Stock Market

So the global markets have been falling for the last one week (falling steeply at that). So what is happening to the stock markets?? Is there reason to panic? Well, in 2 simple words: ‘Market Correction’. So much EZ credit was created that people invested like there was no tomorrow and drove up the stock prices to insane levels and

market correct had to happen at some point. Thanks to private equity, billions have been poured into the markets artificially inflating securities. And now with the credit cycle tightening and hedge funds reporting losses, people are starting to pull back. One must remember that all this selling is purely driven by technical factors at this point, because the fundamentals of the market are good. Once a person panics, I doubt if he will be think about the beta of the stock or the EPS or growth potential. But in a way, it’s a good thing that the markets are correcting as it brings back a lot of sanity without the Fed getting involved.

However, global economic fundamentals are strong with real growth happening in Europe and Asia and they continue/will continue to provide a solid base for financial markets to adjust. The overall US economy and the markets are strong enough to absorb this correction.

Verdict: So What Should The Fed Do?

The considerations for the Fed are changing by the day. The disorder in financial markets has caused both the Fed and the ECB to inject liquidity into the system. Regardless of issues of the economy and inflation, the first priority of a central bank is to maintain orderly financial markets. Without orderly markets, the central bank has no direct or indirect control over the economy in any event.

Except for housing, the economy is still expanding by more than 3% annually. But over the last four quarters, there has no doubt been a drop in construction activity which could be the reason GDP has lowered. In all probability, housing will continue to depress growth into early 2008 (especially as the ARM’s reset going in the 2H 07 and 2008). However, the longer term outlook remains solid, with GDP growth likely to return to near its 3% trend by the second half of next year. The economic data continue to show slower U.S. GDP growth. However, the weakness remains isolated in the housing market.

But with the continuing housing problems and sluggish economic growth, the fed is unlikely to tighten this year. On one hand, inflation is still a concern, and on the other hand, labor markets are still tight. In all probability, the Fed is likely to do nothing in the near term with regards to interest rates; Remember that a rate cut will further weaken the dollar and make the treasuries less attractive to foreign buyers. (I doubt if the US can afford to do that at this point). I do, however, anticipate a cut early next year once all the credit and Subprime issues are out on the table and the picture gets a lot clearer. As of now, no one knows how much exposure the various financial institutions have with regards to Subprime (also esp. since it is believed there is a lot of exposure to hedge funds, which are not required to report anything) and additionally the methods to value these securities have come into question (No one is sure what the exact ‘Mark to Market’ values of these securities actually are).

Once the rates are cut, people will start to get more credit and housing will improve, everyone will start buying stocks; people will forget their worries and a whole new economic cycle will begin.

What is Islamic Finance?

2007-08-10T08:28:00.000-07:00

After more than three decades of modern Islamic finance and banking , the world is seeing double-digit growth rates for Sharia-compliant assets. Islamic finance and Banking is currently being expanded beyond its historical borders of the Gulf region, where it began to emerge domestically in the 1970s as a result of the oil boom. This has driven Islamic financiers to look beyond historical boundaries to explore new territories, both within and outside the Arab world. It has finally emerged in many parts of the world as an alternative financing concept to the conventional orthodoxy of paying interest on borrowings and deposits.

An investing approach based on "Sharia" or Islamic law, Islamic finance has begun to spread all over the world. Modern Islamic financing techniques were developed in Muslim parts of Asia, notably Malaysia, but the boom since the mid-1990s has come from the large oil revenues flowing into the Gulf region. Now, the ideas and concepts of Islamic finance are attracting conventional issuers and investors seeking to tap into new investment opportunities.

What are the key principles of Islamic finance?
To be considered Sharia-compliant, a financial institution or transaction needs to meet the Koran's strict tenets against usury and uncertainty. The most important principle of Islamic finance is "riba," the ban on charging or paying interest. Sharia (set of guidelines as per the Quaran) doesn't consider money as an asset class because it is not tangible; therefore, it may not earn a return. Instead, Islamic law calls for a means of sharing the profits from a transaction or institution among participants - here, the client and financial institution or instrument. Secondly, Islamic law prohibits uncertainty of payout or gambling, but not risk as long as it is shared among all parties. No one participant should shoulder an unequal degree of risk. Thirdly, any Sharia-compliant transaction must be backed by a tangible and identifiable asset. Lastly, Islamic finance forbids investment in or dealings with those industries banned under the Koran: notably alcohol and brewing, tobacco, weapons and armaments, or pork-based products.

How are Islamic banks different from conventional banks?
The biggest difference between Islamic and conventional banks is that Sharia-compliant institutions do not pay interest on deposit accounts. The attraction for clients, however, is that Islamic banks usually also offer profit-sharing investment accounts (PSIAs) that are bound by a "mudaraba" contract. These PSIAs are a major source of funding for Islamic banks.

The Rising Rupee: Boon or Bane?

2007-08-06T12:43:00.001-07:00

Rising Rupee

The rupee has been rising against the dollar for the last couple of months. But what has sent the alarm bells ringing is the speed with which the currency has risen (nearly 10% against the $$ in the last 6 months). Though everyone keeps talking only about the dollar, it is interesting to note that the Rupee has, in fact, also steadily risen against other currencies in the last 5-6 months (8% against the pound, 7% against the Euro and 11% against the yen).

Is this a problem or is this really good for the Indian economy?? One thing is for sure. This is a drastic departure from past policies and a strong rupee will have a really big impact on the Indian economy. The main reason for rupee's appreciation in the last 6 months has been the flood of foreign investments and remittances into India (esp. US$). These $ inflows are coming in the form of foreign direct investment (FDI) to remittances sent home by Indian expatriates. In each case, the flow seems unlikely to slow down anytime soon. That coupled with the Indian stock market's stellar performance has the foreign portfolio inflows booming. The large and steadily increasing net inflow of foreign exchange into India has translated into an excess demand for rupees. Like any other good or service, the excess demand for rupees has resulted in an increase in the price of the rupee.

The rupee's appreciation is alarming exporters, as it makes their products more expensive in overseas markets and erodes their international competitiveness. The software exporters for one are already starting to miss their earnings. The last month has seen all major software exporters taking a hit and there is already evidence in India of an export downturn in a number of other sub-sectors as well (Textiles and Commodities). This is mainly because Indian exporters earn their revenues in foreign exchange. So the more and more the rupee appreciates, the less and less they earn. The current situation has all the exporters screaming as the profit margins are being squeezed out. In a way this is like the shortest growth story as just when the Indian export industry is being talked about as a great economic engine, it looks like the exporters are already being forced to shut shop as they are unable to compete and losing out to their biggest rival, China.

An important factor in the central bank's policy change in allowing a stronger rupee is the rising inflation. The RBI typically controls the appreciation by manipulating demand-supply dynamics of currency market. In order to prevent the rupee’s rise, RBI bought close to $20 billion in the last four months to curb the rupee’s rise (Incidentally, India's foreign exchange reserves have now crossed the $200-billion mark). But as RBI purchased dollars (creating more demand for dollar) and sold rupees (increasing supply of INR, thereby decreasing its value), the money supply increased - which meant too much money chasing the same (or less) number of goods – and this led to increased inflation in the country. The increased liquidity therefore fuelled inflation and of course as we all know this comes with a 'Political Cost' attached to it. So the RBI backed off and let the rupee appreciate again. When RBI was buying billions of $$, inflation shot up in excess of 6%, but when they stopped buying $$$, the resulting large drop in money and credit growth lowered inflation significantly - The govt. has targeted a 5% inflation for 2007.

Of course on the flip side, all the importers are extremely happy as imports have become much more affordable. An appreciation of the rupee has made the import of foreign goods (such as crude oil and petroleum products) cheaper (in rupees) in India. The rupee appreciation should exert a downward pressure on the inflation rate. A strong rupee in nearly a decade may be good news for importers and those who see the currency as a symbol of economic prowess. However this does little to prevent the dilution of our country's competitiveness because a cheaper dollar makes imports easier and exports tougher. The profitability of exports is already being affected, and if the appreciation in the rupee continues unabated, they will feel the pinch and exports will suffer.

So is a strong rupee really curbing inflation?? Should RBI buy more $$ to curb the Rupee?? RBI has a difficult policy choice at hand. In which direction it will move will depend on which objective is given more important i.e inflation control, maintaining export growth or capital account convertibility. The government and RBI are keeping their fingers crossed and hoping that there will be no need for a major intervention. However, given the amount of $$ flowing into India the problem is unlikely to disappear soon.

Death Bonds: Praying for people to Die

2007-07-26T11:56:00.001-07:00

Move over Hedge Funds...Here comes the Death Bond!!!

Just when you thought you had seen the most analytical, complex, high-risk alternative investment vehicles from Wall Street, they have yet again come up with a new way to make money. Its called the 'Death Bond' and believe it or not, it involves making money when people die. Mmmm.. I thought something was fishy when I heard that Germany unveiled a 24 hour death channel.

How does a Death Bond work?

Death Bonds (or life settlement-backed security) is created in the following way:

A person who wants to cash out of a life insurance policy hires a "life settlement" broker to find prospective buyers to sell his insurance policy.
The broker seeks bids from specialty finance firms called life settlement providers, which are often financed by hedge funds and investment banks.
The life settlement provider resells the insurance policy to a hedge fund or investment bank, which warehouses it in order to build a big pool of policies.
After an investment bank/hedge fund collects a sufficient number of policies (around 200-250), it turns them into asset-backed securities called death bonds to sells them to investors.
The The buyers keep paying the premiums until the seller dies, and then they collect. The up-front payout to the seller varies widely, from 20% of the death benefit to 40%.

The mechanics in theory seem quite straightforward: Asset Classes are pooled together and then sold off in the form of bonds or pieces of bonds. When people die, the banks collect. When people die quicker, investors get richer. It is estimated that there are 90 million people in the US with Insurance and this is certainly a temptation for Wall Street. Another big attraction for these types of "Asset Classes" are that they are uncorrelated assets (i.e. they aren't correlated with stocks, bonds, commodities, or other investments) and they are also immune to market risks (interest rates, currency risks etc.) which make the portfolios less volatile.

Well the truth is, at this early stage, there's no way of knowing how popular death bonds might become. I for one do not want anyone profiting from my death. But hey, that does not stop me from watching EoS TV.

Wonders Of The World - The New 7

2007-07-18T12:53:00.000-07:00

The New7Wonders recently announced the 7 wonders of the world. The following wonders have been elected to represent global heritage throughout history. While a lot of people think that one wonder is better than the other, the listing was issued in random order. All the New 7 Wonders are equal and are presented as a group without any ranking. An honarary award was presented to another wonder for being the only original ancient 7 wonders of the world to be still standing.

The Taj Mahal, India

The Roman Colloseum, Italy

Petra, Jordan

Machu Picchu, Peru

The Great Wall, China

Christ Redeemer, Brazil

Chichén Itzá, Mexico

And the honarary award goes to.........

Pyramids of Giza, Egypt

Infosys: Ready To Play With The Big Boys

2007-07-12T12:34:00.000-07:00

Infosys is ready to shop and the markets are ripe with rumors that they want Capgemini. Really? Agreed, Infosys has accumulated billions over the years, but can it afford to buy a company which is 3 times bigger…mmmm....

Lets look at some hard facts:

For 2007-08 Infosys has projected a 28-30% revenue growth and Capgemini has projected around 8%

Capgemini has a market value of 7.86 billion euros or $10.6 billion. Infosys has a market value of about 1.1 trillion rupees, or $27 billion

Capgemini has about 68,000 employees worldwide, including 12,000 in India, Most of Infosys's 72000 employees are in India, where wages are as low as one-eighth that of U.S. salaries

Infosys reported revenue of $3.1 billion for the fiscal year ended March 31 this year, and has forecast revenue of about $4 billion in its current fiscal year ending March 31 next year. Capgemini is 3 times bigger with revenue of $10 billion for its fiscal year ended December 31

Infosys’ operating margin stood at approximately 31% in the end of 2007, Capgemini's was 5.8%

"Lets take 'em boyz, there's only 70,000 of them and each one is paid more cheaply than the other"

In my opinion, this deal is highly unlikely to go through. With the weakening of the dollar, granted that all the big Indian players have to do something and take the next step, but let’s be realistic. Other than Capgemini's consulting arm (which is obviously stronger), they both seem to share the same strengths...So the question is what "real" value will buying Capgemini bring to Infosys? Infosys may be looking for access to the European markets, where it doesn't have a strong presence, but the cultural incompatibilities between the two companies are very high, and I for one don’t believe Infosys will be successful in bringing 70,000 employees under their wing who are culturally on the opposite end of the spectrum.

One thing is for sure. This rumor has certainly generated enough buzz to move the stocks (Capgemini is up 4.5%) and Indian outsourcing companies have shown they are “coming of age” and catching up with their European counterparts. But the question is will Infosys go above and beyond its reach at any cost. My answer again will be no as Infosys does not have such an aggressive mentality. They have downplayed the news not wanting to shoot themselves in the foot that one wonders why they are being so defensive. The CEO of Infosys himself came out and said he has not ruled out an acquisition in Europe, but said any target would have to meet Infosys' criteria (which no one knows incidentally!!!). Consider this approach to the one Rupert Murdoch took to acquire Dow Jones. Coming back to the point, another complication is the lack of M&A expertise for a deal of such a magnitude in India. Even if it goes through, can they truly integrate as one firm? Maybe I am being skeptical, but again, I highly doubt it.

Finally, Infosys is/has always been a debt-free company and a deal of this size will for the first time put them in a position where they will acquire a lot of debt and move away from organic growth. Though raising capital won’t be difficult, the real question is "Is Infosys ready to play like the big boys?"

Who are you???

2007-07-11T19:05:00.000-07:00

WHO ARE YOU???

You work very odd hours.
You are paid a lot of money to keep your client happy.
You are paid well, but your pimp gets most of the money.
You spend a majority of your time in an air-conditioned room.
You charge by the hour but your time can be extended for the right price.
You are not proud of what you do.
Creating fantasies for your clients is rewarded.
It's difficult to have a family.
You have no job satisfaction.
You are embarrassed to tell people what you do for a living.
People ask you, "What do you do?" and you can't explain it.
Your family hardly recognizes you at reunions (at least the reunions you attend.)
Your friends have distanced themselves from you and you're left hanging with other "professionals."
Your client pays for your hotel room plus your hourly rate.
Your client always wants to know how much you charge and what they get for the money.
When you leave to go see a client, you look great, but return looking like hell (compare your appearance on Monday AM to Friday PM)
You are rated on your "performance" in an excruciating ordeal.
Even though you get paid the big bucks, it's the client who walks away smiling.
The client always thinks your "cut" of your billing rate is higher than it actually is, and in turn, expects miracles from you.
When you deduct your "take" from your billing rate, you constantly wonder if you could get a better deal with another pimp.
Everyday you wake up and tell yourself, "I'm not going to be doing this stuff the rest of my life."

Oh Wait, You are a Software Programmer. OK. (Now, Now, What were you thinking??)

Big Trouble in Little China

2007-07-11T14:41:00.000-07:00

China is booming. Every investment turns to gold. The country seems to have unlimited cheap labor at its disposal. GDP growth seems to be 10+% year after year. Chinese stocks trade at insane multiples and a record number of investors seem to get into the market every passing day. Beijing and Shanghai seem to be building more skyscrapers than New York. Lo and Behold,
China has started shaking the world with its prowess in manufacturing, On paper, everything looks great and it looks like China is all set to take over the world.

Not so soon my friend. China's problems are just beginning. It has certainly made the world take notice, no doubt. But just as people are starting to look at China, they are realizing the enormous problems that come in dealing with a country whose government is as mysterious as its culture. Not all is rosy. China has serious problems with its environmental resources, severe pollution, and institutionalized corruption within the government, the legal system, the police force, and the media.

The Chinese culture maybe 3000 years old, but the Country has opened up only in the last 30 years. China has gone on a mass industrialization rampage and the unfortunate side effect has been the startling revelations of the food scandals (among others) and how China cuts all corners with obvious disregard to quality and human life.

Shoddy products being manufactured in china has emerged as a global concern, with many countries increasingly worried by the dangers of importing products from China. As more and more embarrassing stories come out, the country is scrambling to (or at least claiming) show the world that it was serious about improving the safety of Chinese products and is a responsible player. So they did something interesting this week.

China executed its former top food and drug regulator on Tuesday for taking bribes.

It is a bit extreme, or is it??? China carries out more court-ordered executions than the rest of the world combined, according to human rights groups.

However, what has come as a bigger shock is, while the country is answering its buyers, news that their own high-speed maglev train, running between Wuhan and Guangzhou ...well, seems to have a few problems has sent the bells ringing. So relax, they are screwing themselves too.

And me worry?? Nah, we have just seen the tip of the iceberg. There is still a long way to go!!!

Indian Presidential Race

2007-07-06T08:34:00.000-07:00

The Left's are Wimps, The Right's are Crazy

Left: Shivraj Patil??
Kalam: I will continue….I will continue….
Right: Sherkhawat??
Kalam: Can I continue for god’s sake??
Left: Laloooo??
Kalam: I will continue The presidents office needs a good statesman
Right: What about Amitabh or Rajini??
Kalam: Ok, I am quitting the race now
Left: Ah, Pratibha Patil then?
Right: Perfect choice. She is old, cluesless, talks to spirits and is totally under the control of “The Madam”.

It is interesting to see that the one person who cannot be at the helm of the country (henceforth "The Madam"), still undoubtedly wields the power that no Indian has. I am actually not surprised that the presidential candidate is someone whom the madam has personally recommended and there is just really one reason she has been picked - She is a staunch Gandhi/Nehru family loyalist and thereby has proved her worth to the highest office of the nation. WHAT!!!!!!

As sad as it may sound, all the numbers look good for Pratibha Patil and she is well on her way to create history (on paper) to become the first woman to hold the country's highest office (does not matter she will do nothing while in office).

Neither is she a political heavyweight nor have Indians heard of her before her name started doing the rounds. Sure, her credentials include her brother being accused of murder, she has defaulted more than 17 crores loan out of a bank, she is a defendant is a class action lawsuit and has swindled 5 crores from a trust she was responsible for. But come on, what are her real qualifications? What has she accomplished in Indian politics? Has she shaped or framed any policies which have been implemented? What has she done for Indian politics apart from being a do nothing cabinet minister?? Does she have any influence over other political heavyweights? Has she driven economic or other development in her state?? Can she accomplish anything at all in the 5 years she willl be in office?

Sadly, the answers seems to elude everyone and I for one am shocked how all the parties are engaging in dirty politics to ensure their candidate wins at any cost. Considering the fact that it is Abdul Kalam's shoes that she is going to fill, it almost makes me cringe that while Kalam has openly said he is ready to take on another term, he surprisingly has won very few friends supporting him (Go Jayalalitha!!). While the people of the country overwhelmingly want him to continue (polls indicate he has 80+% support of the country), it means nothing.

Here is a fact which is known to very few people. The President of India is elected by the ruling party. Not the people of india, not the educated man, not the masses, not the people who help elect the government. Just a few people in the ruling party, in this case the madam, single-handedly, has the power to select the president of the country to represent more than a billion people. Ridiculous huh??

Just when India is entering the most important economic phase in history, just when the entire world is turning its eyes towards India, it is indeed sad to see the so called largest democracy showing the world how the political games are played and in a strange way proving that the people's opinion (actually a billion opinions) dont really count. This presidential election will no doubt go down as one of the murkiest in history and very few indians are genuinely going to be able to respect their president for the next 5 years.

Heck, it is public knowledge that Pratibha Patil was not even Congress' first choice as a candidate, but I guess the only qualification that one requires in order to rise to political prominence in India is keep sucking up to the Ghandhi family all your life and maybe, just maybe when you are turn 70+, you can become the President or even the Prime Minister of India.

Chumma Adiruthuilla!!!!

2007-06-29T19:50:00.001-07:00

"Coooooooool"

How was the movie???

How many hours did you wait in line to get tickets??

Did you see the first day first show??

Does the movie have subtitles??

Were the tickets sold out??

Can we book tickets online??

Why is it playing so far away??

Whoa..... I have never been asked so many questions after I watched a movie. And then it sunk in slowly. Damn!! The Sivaji craze has definitely swept New York too. I am not getting into the story, but the million dollar question is, does the movie deliver and live up to all its hype?? Well, Yes and No.

As a Rajini Fan, Absolutely Yes. I whistled and threw popcorn every time Rajini flipped the coin or made a gimmick on screen. I was laughing my ass off when Vivek was delivering the punch dialogues. Watching the movie with a packed audience was truly electrifying and an experience I will cherish for a long time to come. Heck, where else can I see a 70 year old patti in front of me saying "Superrrrrrrr Superrrrr" encouraging all of us youngsters to cheer louder. I had to remind myself every now and then not to trash the cinema hall too much as I still in New York. When the movie was over, a bunch of non-desis (just trying to be politically correct) came in to clean with a dazed look on their faces unable to understand why the craze and curious as to what kind of movie was playing. Then on an impulse some of my friends wanted to watch the next show again. What wait, am I going to watch the same movie back to back??? To my relief (not that I told anyone publicly), the next show was sold out. Phew!!! Close call.

No doubt, there were parts which I loved and other parts were Yaaaaaawwnnn. The songs are great and ARR has certainly delivered on the background score (it woke me up several times actually) and the superstar certainly carries the movie and does what he is supposed to do. Rajini has proved that at 60 he can still act(Look out for the MGR Sivaji) and carry an entire movie with no help.

But I went home and thought about the movie and thats when the critic in me came out. I heard Shankar was trying to keep the story under wraps. Wow!! What story my friend? To put it mildly, Sivaji has no story. The entire hype has been built on Rajini who single handedly cleanses the society (don’t all Shankars hero's do that??). I wonder what the hell was in that movie that Shankar spent 80 crores on it. He should have spent some money to hire someone to write a good story instead. Agreed, the sets are lavish and Rajini has been made to look like a rap star, but come on, we need a script for sitting through a movie which is 3+ hours. One would also think that Rajini and Shankar/ARR would bring something new to the table, but clearly they did not want to be too bold or experiment.

Sivaji has certainly achieved what no other Tamil movie has (it was in the UK top 10 for a week), and it has opened up the market for regional movies globally. (Move over SRK and Amitabh, here come the real superstars of Indian cinema). Frankly, the movie runs in patches, there are no doubt, some really good, brilliant, funny scenarios woven together with weak moments (I am leaving out the unbelievable, as after all, this is a Rajini movie and asking for logic would be too much). The fights are great with special effects and watching Rajini bash up 25 people in slow motions is simply superb (with the FX of course). AVM, Shankar and Rajini should thank their lucky stars as everyone has given Sivaji the benefit of the doubt and embraced it wholeheartedly (only for Rajinis sake) making it a runaway success.

My $0.02 to Rajini: The movie entertains to a large extent. But please remember from now on that you have a global audience. The sets and heroines are not important in your movies. The story, script and your style (strictly in that order) are the only things that matter.

My $0.02 to Shankar: Be bold and experiment. Don’t get scared that you have to protect the star’s image. Alternatively, don’t direct movies with bigger than life stars. I would have been very happy if you had the guts to show Rajini flipping a cigarette in style rather than wanting to show it, but getting scared, and eventually settling to showing him flip a chili. That’s not style, it’s ridiculous. And next time, before you spend someone else’s crores, write a story!!!!!

And finally to all Indian film makers, next time you decide to show Wall Street in your movies, talk to me. I will tell you how business is done on the street. Don’t freaking show 25 people in suits and try to pass them off as wall street businessmen.

But anyways, I do have a confession to make and this is the fan in me talking. I will be watching Sivaji for the second time this weekend, with a bunch of people from work (who don’t understand a word in tamil btw). But, I am certainly not spending money on popcorn this time around.

VERDICT: Entertainment Guaranteed, even if you don’t know Tamil!!

PS: The movie, declared India's most expensive, has been made at a cost of Rs.80 crores and it has been projected to do a business of Rs.150-160 crores.

Go Ahead, Jump the Fence!!!

2007-06-29T12:02:00.000-07:00

Did we just give the green light to keep jumping the fence. Apparently we just did...

So here we go again. Like many of you, I picked up the newspaper and was really disappointed to see that the immigration bill died in the senate and will not be debated anymore. What is everyone thinking?? I don’t agree with anything the Bush administration has done so far, but after 7 years he finally comes up with one good plan and it gets killed!!!!!!!!!!!

Booooooooooooo to all of you guys who are against CIR (Comprehensive Immigration Reforms). The congress is only 6 months old and its already become a "Do Nothing" congress.

Fact: There are close to 13 Million illegal residents within the country.

Fact: As per the law of the land, it is not illegal to be here illegally (funny huh?? Well, it is considered only a civil crime)

Fact: There is no way to trace where these millions of illegal people are and there is nothing to stop more people from coming in the future.

Fact: Say what you want, but at least 70% of these people are latino’s

So we can all either accept the fact that these people are not leaving (come on guys, do you seriously think you can trace and deport or convince 13 million people to leave) or wait till the day 13 million becomes say 20-25 million (you know its going to happen with each passing day you refuse to address the issue) and then it becomes much much more difficult to tackle.

I am not getting into the details of the bill (and the 100’s of amendments everybody wants), but some of the important points for everybody to consider before they oppose is:

The 12 Million undocumented workers can come forward immediately and receive probationary legal status (What is there to oppose in that??? Hey, if I had 12 million people in my backyard, and I don’t even know where they, you bet I want to know who/where they are)
Bill creates a four-year, renewable "Z" visa for those present within the U.S. unlawfully before Jan. 1, 2007
Undocumented immigrants may adjust status to lawful permanent residence once they pay $5,000 in fees and fines and their head of household returns to their home country.
No green cards for "Z" visa holders will be processed until "triggers" for border security and workplace enforcement have been met, estimated to take 18 months.
Processing of green cards for holders of "Z" visas would begin after clearing an existing backlog, which is expected to take eight years. (which means, it will be at least 15 years before these people get green cards and 20 years before they can become American’s). Heck, many of them won’t even be alive in 20 years.

And before any of these people can apply to become Green Card holders, the border security must be enforced (This part is especially for people who oppose, so take your heads out of your A$$ and listen):

20,000 new border patrol agents will be hired and 300 miles of vehicle barriers and 370 miles of fencing along the U.S.-Mexico border will have to be completed.
All that ground-based radar, camera towers, unmanned aerial vehicles and supporting systems etc. will be funded and implemented.

So in essence, border security will be enforced before any of the undocumented (ok, illegal) people can be granted permanent residence.

Once border security has been enforced, a guest worker program will be established (“Y” Visa), under which people can come in LEGALLY to work in the United States.

Still opposing the bill????

The fact is these people contribute to our economy (or its probably a wash, depending on how you look at it), but if we legalize them, it certainly gives hope to millions. And come on, the US has its lowest level of unemployment (hovering around 4%), and we have managed to absorb 12 million workers into the country. All senators talk about strengthening border security and building a fence and then legalizing, but what I don’t get is, that’s what this bill states, then why are you opposing? Do you think that by putting if off, you have solved the issue??

Fact: 13 million people will actually contribute to the economy (TAXES!!!! I am sure the IRS is a strong supporter of the Bill)
Fact: All of these people (X or Y Visas), will have to undergo background checks and criminal checks, so we can actually catch the guys who are committing crime
Fact: You can actually control crime, including stopping drug smuggling (Hey, you at least know where they are, so go and catch them)
Fact: If people have hope and they will try and come here legally, (ming chu will not be coming in a container and Immanuel will not jump the fence risking their lives as a first resort), and we might actually be able to control the flow of people we cannot trace.
Fact: You have just messed up a CIR amendment on stopping the H1-B and L1 visa abuse (Too big a topic for discussion on this one)
Fact: The heavily Latino underclass of unskilled, poorly-paid U.S. workers will be free from the shackles of unequal treatment as a human beings. (You can deny it, but it is happening!!)
Fact: There will be millions more coming in illegally before you address this issue again.

American’s get so emotional when it comes to this issue that they fail to see rational benefits if the bill is passed. I am not blindly defending the bill, of course its perfect by no means, but it’s the most realistic bill I have seen in recent years, which can actually work. Right now, the system is broken and beyond repair (trust me, we are coming back to this issue when the 13 mil becomes 25 mil) and at the very least, this bill creates a system where we can control the flow and reduce crime.

All the conservatives are bloating that they have a victory in defeating the bill. But my friends, trust me, by killing the bill (thereby the debate to see if it’s good or bad), do you know you have just told all the people looking to come here for a better life .“You want to come to the USA, great, but wait, we have just made it complicated to come into the US the right way if you are not educated, so go ahead Pablo, just come here illegally, its much easier”

Myth: Illegal aliens cost the American taxpayers tens of billions of dollars in social services, primarily in the areas of healthcare and education. No they do not. Go back again and check your facts.

Final Fact: These people are going nowheres Jose.

So you can either let them pay taxes and live here legally in peace, or encourage them to jump the fence.

But wait, Oh Ok…Apparently we just told them to jump (sigh!!)

(When) Did the Mahabharata Happen?

2007-06-29T07:20:00.000-07:00

I came across a very cleverly written piece a few months back but all my efforts to trace the writer has been unsuccessful. The article has since then been taken down (I wouldn’t be surprised if the psycho Shiv Sena’s had a hand with it), but luckily I had a saved copy of the article.

I think its pretty funny, so here goes…

This is one question that has been bothering me for a while. Like most of you, I too have learned history in school, but never found an answer because like most of you I too slept in the history class. But after doing some research I have found out exactly when the Mahabharata war happened.If this is not Kali Yug, then what is it?

Kali Yug is one of the Yugas as per the Puranic timeframe. First there was Satya Yuga, then Treta Yuga, then Dwapara Yuga, and now, Kali Yuga. Even though the Puranas stop at this point, this was followed by various minor Yugas that went undocumented. These include India-Got-Independence Yuga, Secularists-wrote-history Yuga, and Secularist-lies-got-exposed Yuga.

One of the dates mentioned for Mahabharata is 3130-3140 BC. This date is based on the work of Aryabhata (with one t), who lived from 476-550 AD. Aryabhata held that the earth rotates on its axis, and gave the correct explanation of eclipses of the sun and the moon. In mathematics he solved the quadratic equation. In his spare time he also found an easy way to compute the tip mentally after seeing a restaurant bill. But he could not figure out how to fill Form 1040 without using Tax Cut.

Aryabhata stated that Kali Yug started 3600 years before, when he was 23 years old, making the start year as 3102 BC. To this if you add the age of Krishna, subtract the year when he was born and do a cube root with the number of years the Pandavas ruled, it will be found that the Mahabharata war happened in 3130-3140 BC. Looking at this information we can infer one thing for sure: When you are a 20-year-old something in 500 AD, there is very little for entertainment. Another way to verify the dates of historical events is Archeology.

But more than Archeology, Philology has been used to write ancient Indian history. Philology, started by a guy named Phil, is a discipline devoted to the reconstruction of history and culture based on the comparative study of ancient languages such as Sanskrit, Greek, Latin and others. If the researcher does not come up with a conclusion involving all those languages, then he may not get a grant to continue research. Philology grabbed Indian history in the year 1785 when Sir William Jones started studying Sanskrit. He found many similarities between German and Celtic languages and postulated that all of these must have originated from the same source. Shared language means shared heritage, was the conclusion. The idea of one civilization spreading from Europe to India looked impressive. But there was one problem. How did the language spread from Europe to India?

So we got the Aryans, a group of horse-riding, fair-skinned, tuxedo-wearing people who invaded India and taught the dumb Dravidians everything from Vedas to Internet. There was one more problem -- they had to find one Aryan Homeland, somewhere in Europe. The main contenders were the south Eastern Europe and Frankfurt International Airport. Finally it was decided that the Aryans came from south Eastern Europe, which was finalized by throwing darts on a National Geographic Map of the world. The other day I was in K-Mart, looking to buy a bottle of Tang. I picked up the orange flavored one and it was written in Spanish that the flavor was 'Naranja'. Now in my home state of Kerala, a lemon is called 'Naranja' in Malayalam. So as per philology, Mexico, where Tang was made, and Kerala have a shared heritage. Now all I had to do was find a common homeland. For this I threw the dart at the National Geographic Map in my cubicle. But it hit my cubicle neighbor in the head. Anyways, she talks too loud.

Since I don't have a Sir before my name, the theory, 'Malayalees are from Mexico' is not popular. But it is important that we do some archeology to verify these philological theories. So an archeologist takes a shovel, goes to a spot where the earth has not been disturbed in recent times. Digging down, he finds various strata of earth clearly separated from each other. Motivated by the fact that he might find some bones, pottery, or tools that can tell a great deal about the history of early humans, he keeps digging. Finally he hits on an earthworm family, which was having a quiet earthworm lunch, and looks up and gives the choicest abuses in earthworm language.

Even though Archeology can open a can of worms sometimes, archeologists who conducted excavations in various places mentioned in Mahabharata found iron objects which included arrow and spearheads, shafts, tongs, hooks, axes and knives that indicate the existence of a vigorous industry. An analysis done based on these excavations points to the date of Mahabharata as 1000-900 BC, about 500 years before Buddha From what I have been reading these days, archeology is also not very popular with a certain section of people, like for example: historians. This is because Hindu Fundamentalists have been using Archeology to push back the antiquity of Indian civilization, according to Dr. D. N. Jha who told this in an article which appeared in the New York Times, and the reason for that is Saraswati. Through satellite photography, scientists have mapped the course of an enormous river that once flowed through the north western region of India. Dr J. R.Sharma who heads the Remote Sensing Services Centre in Jodhpur and his team believe they have found Saraswati, of the Ganga, Jamuna, and Saraswati (1988) fame starring Amitabh, Mithun and Jayaprada.

Saraswati, the river mentioned in the Vedas, is believed to have disappeared thousands of years ago. On this discovery, the Government decided to send archaeologists and geologists to explore sites along the river's course. We cannot predict what these archeological excavations will reveal. Maybe it will bring out more evidence of a civilization that pre-dated the Aryan Invasion, proving that when the Aryans came into India and tried to teach the locals how to use dial-up connection, the locals taught them how to use Wi-Fi networks.

The losers would be the people who championed the Aryan Invasion Theory and are not willing to change it in the face of new evidence. Archeological excavations in the Saraswati region would be a real historian's dream. But unfortunately this project was started by the democratically elected BJP Govt, which makes it illegitimate and motivated by religion according to the logic beamed into the critic's head by the aliens that appear in The Simpsons. That is the topic for another article.

But, anyway, we have an approximate idea on when Mahabharata happened. It happened in 1988 on Doordarshan.

The iPhone (The Phone that almost was)

2007-06-28T14:21:00.000-07:00

Wait Wait, is tomorrow is the iDay???? For all the iphone/apple "Oh, its so cool folks" (I am calling them official beta testers), Yes it is. But guys, the book (iPhone, The Missing Manual) is out only on August 15th and you can pre-order from Amazon.

I was walking by the apple store on 5th avenue and spotted a looooong line. I could not believe it as there was a bunch of kids, guys, girls and even some granny’s waiting for the countdown so they can run into the store and buy the phone (or maybe once they all realize how much they overpaid, their next stop at the same speed may be EBAY). And of course, well, new york being new york, there were even a few guys screaming trying to sell their spots on the line for a couple of hundred bucks (Attention: Those who dont want to stand in line). I picked up the papers and everywhere i read, there were iPhone reviews. Turn on NBC, CBS, ABC, WB11, all of them full of iPhone ads.

Has everyone gone mad??? I have nothing against apple (I own 3 ipods myself) and after looking at the plan from AT&T (formerly Cingular), its a no brainer for any person who currently uses a smart phone to conclude that the hype will die down very quickly as its easy to talk the talk, but will people walk the walk on this one??? At $500 (for a 4GB) and $600 (for a 8GB) a pop, it is an EXPENSIVE phone and for all this, it DOES NOT have all the features of a true smart phone.

The hype and hoopla is so high around this gadget that it is truly baffling. You've got to hand it to steve jobs. His net worth has certainly skyrocketed and the stock has been on overdrive since the iPhone announcement. He certainly has managed to whip up frenzy like no other phone has done in the past and for all this, this is apple's first foray into the cell phone market (ok, ok leave out ROKR guys, that was a total disaster!!!). The only true accomplishment of the iphone will be waking up Nokia, Motorola and RIM and changing the smart phone gadgets/market from now on.

Here's some of my thoughts on what rocks and what sucks. Even if you dont agree, as I like to say, a drunk mans words are a sober man's thoughts.

What Rocks about the iPhone

Looks Sleek and Ultra-Cool
Looks Sleek and Ultra-Cool
Looks Sleek and Ultra-Cool
Looks Sleek and Ultra-Cool
Looks Sleek and Ultra-Cool

What Sucks about the iPhone

Only available through AT&T (What were you thinking Steve????)
No Games
No Instant Messaging Chat support
No Picture messaging (MMS) capabilities
No Video recording capabilities
No Voice recognition or voice dialing
No 3G Network Support
No GPS (What!!! after all this Hype???#$%#$#)
No support for all of the iPod accessories
No easy way to transfer phone numbers from an existing phone - This sucks esp if you own an smartphone with 100's of contacts
No editing or saving of word and excel documents
No Removable battery - which means if your battery goes, you have to take it back to apple. Btw, apple has already disclosed that battery will need to be replaced after 300-400 charges
AT&T has refused wireless insurace on the iphone as the phone is provided by apple
No Expandable Storage
No Corporate Email support - This is the biggest deal breaker personally for me. If it cant support my work emails, no way Jose.
Takes more taps to reach the phone interface than other smartphones - I know cause I currently own both a Blackberry and a Treo
Will not work on Pre-Paid service
No access to iTunes Music Store
No way to seach songs or contact lists
And finally a Desi being a Desi, I cant unlock it and give it to anyone back home. Come on desi’s, ya’ll know its true (I am actually rooting for the Chinese on this one to hack the phone and unlock it within the next 3 days)

I do admit that I spend a lot of my money on booze, gambling, women and fast cars. (The order may change depending on the day of the week). The rest I just squander away. But will I squander away $600 on the iPhone just now???? Nah!!! I think I will wait for the 2G iPhone, which apple will be forced to bring out very very soon, unless blackberry has already thrown a curve ball at the iphone.

Buy hey, please go ahead and buy an iphone for yourself. After all I do own lots of apple stocks and every time one of you buys an iPhone, I get rich:):)

Not buying the phone yet??? Geeeeeeezzzzz, Ok, at least order the book from Amazon!!! (Oh!!Did I tell you I have a deal with the writer as well??).