The Great Indian Tamasha

Imagine for a moment that you just got lucky. You have won some contest to own/manage a house. This house is not yours forever but you get to enjoy it with all perks as long as you remain its owner. However, ownership comes with a term limit of 5 years and need to be renewed every five years, if people in the house are happy with your conduct. So overall great.

However, like with all good things, there is as usual a catch.
The original owners who drafted the will, were not so fond or certain of future owners so to keep the house, they have kept a provision where the house can be managed only by care-takers. This provision is also needed for the fact that people who wish to become house owners, have no prior experience in managing a house but still a great desire to own house due to the perks. The caretakers are selected through an elaborate exam which tests their linguistic skills and memory but not any other skill related to the management of the house.  Hence while on paper it looks like that your job is to manage the house, in reality, your job is to manage caretakers. As you can neither hire caretakers, nor fire caretakers, you should rather amuse caretakers so that things run as smooth as they can.  Caretakers being caretakers and that too being favourite of the original master, have their own style, privileges and fancies. So you have to be careful so as not to trip on their egos or manners as they have a power full association.

As far as caretakers are concerned, they keep on getting multiple masters for a variable duration, hence they have learned to live with such nuisance or rather mastered the art of managing these short term owner. Caretakers don’t have any ownership or any long term right and also no punishment, their focus like any other rational human being is to maximise gain for themselves as they are more of backroom boys.

Caretakers also have some sort of contempt for the house owners and other occupants as they miss good old days of originals masters and rue the scenario of hoi polloi mastering over them.

While caretakers are pretty good, they keep on getting transferred now and then, for example, somebody who was earlier in-charge of dusting is now head cook, while head cook has been given the task of a plumber and so on so forth. Further, there is no accountability for caretakers as to punish a caretaker, you need the help of other caretakers, and to make the matter more complicated, one can not hire outsiders as caretakers. So you have to manage with whatever is available. On the other hand, for any mess, house occupants always blame the house owner, hence the house-owner tries to make things rosy by keeping caretaker in good humour.

This house with its unique design of perpetual instability creates a scenario where caretakers focus on maximising their gain from the system, as well as house owner, wants to manage the house with the sole intention of extending the ownership right beyond 5 years. All this ensures that nobody is really willing to invest time and energy for long term repairs, planning after 10 /20/30 years as the burden will be on new master and new caretakers. Everyone is looking forward to the next day and the whole focus of house owner and caretaker is to keep house occupants happy with good whitewashing, weekly parties and good food.

Any action which is long term and does not show any visible effect immediately is brushed aways by owner and caretaker with  equal zeal as there are always more pressing daily challenges.

If this scenario has already hammered your mind, wait to know two ore important occupants of this house. 

The house also has one old grandfather,  who is not related to either house owner or care taker but is there from a long time. The grandfather is very stickler about his routine and holidays. Come what may, the holiday must happen and routine can not be disturbed. Meanwhile, as house-owner and caretakers don’t get along very well, they keep on going to grandfather to sort out all the issues and many time use grandfather name to cover their tracks. Further given advance age and being little senile, grandfather is not in touch with ground realities of the house but has the habit of interfering in all affairs of the house and give a sermon to all occupants about a perfect life and good habits all occupants of the house must follow to make this house a perfect house. Grandfather is also very fond of Latin and English and generally issues his orders in 100-300 page long orders quoting all phillosphers. The beauty of these orders is that everyone thinks it is in their favour and generally takes month to decipher the message. 

The last but rather most important occupant of the house is children. Every key person of the house ie house owner, caretaker and grandfather are always very concerned about the children. Children being children create racket all the time. They also keep on going to grandfather to keep them safe as well as put caretaker and house owner in their place. Needless to say, grandfather is very fond of children as long as they don’t disturb his afternoon siesta. There is another important thing that children have a way with house owner as an extension of the lease/term is totally dependant on children. Hence every house owner tries to please children with a lot of gifts and entertainment and never ask children to study or do physical exercise lest children get angry with them, hence house owners keep on pampering them. Caretakers have no such challenges, so while caretakers talk of serving children with an aim to please and focus on their long term benefits, they despise children and consider them as a nuisance. And when Grandfather is not looking, caretakers don’t mind boxing ears of children and giving some punishment. Children being children have figured out the scenario and while they keep chasing house owners for more gifts, they keep a safe distance from caretakers. 

And life continues. 

Covid19 & Economy

While there is much noise and lot of mathematical modelling on spread and damage by Covid19, there is hardly any crystal gazing when it comes to general economy.

The way things are, I think both side will be turn up wrong big time.

In India, damage by Covid19 will be contained and won’t spread much as one can see that Indian not are trending 100x lower than USA despite having almost same initial points.

However damage to economy will be 10x more deeper and shall be there for at least 18 months. I expect NIFTY to touch 5k when next wave of data start coming in terms of corporate not and taxes.

4th April 2020

Covid19 & Laws of Mathematics / limitations of modelling

What if Naseem Taleb and all prof of gloom & doom turned out to Malthus of our time?

While Taleb is a super genius guy, but he is extremely wired towards black swan. And all is models are at the end mathematics models only

On Maths, remember what Einstein said
“As far as the laws of mathematics refer to reality, they are not certain; and as far as they are certain, they do not refer to reality.”

Further It is good to have black swan people on the side but not as main advisors
as if we see in terms of Taleb fund performance
It is not Naseem Taleb which has given consistent high returns since 1988 but Jim Simmons

So beware of all maths, fat tails and models as they do not account for human spirit, evolving immunity / resilience and innovation.

As at the end Malthus turned out to be super wrong.

Again remember – 90% infected people do not need any treatment and get fine without any medical intervention. This figure will only increase with time.

India – The whataboutery nation

It is an age of whataboutery!

Almost every week, some trend start on Internet about violence on muslims. Then there are equal story about violence netted out on Hindus. Curiously very few netizens (twitter handles) are outraged on both and one can see the separation or whataboutery.

There are endless stories of justice rather lack of it for hapless victims. Stories continues, narratives keep on changing. 

However the key thing which both side ie “this is not my india” vs “see how others are killing us”, forget that It is the Indian state which is oblivious to the ordinary.

Indian state is perfect secular state. It treats all equal – be it Hindu Muslim or Christian. It remains oblivious to them. It collects taxes / bribe equally and remain deaf to them equally.

Or in better words, Indian state collects tax but doesn’t dispense justice 

Indian state has been designed to serve, protect and feed the chosen ones. Forget Phelu Khan, do you remember closure of any case one year, two years, five years or even twenty years. 

Indian state remains in British mould where it just focus to serve the masters – earlier gora sahibs, now bhurra sahibs who sit in gymkhana club and worry about India over soft laughters and single malts while debating next UN/World bank posting (probably this answers as why India not so rich country, is so prompt in paying its UN dues while US/UK who have money don’t even care about UN dues)

Remember Nirbhaya, Remember Sonipat violence – you might even ask what about Sonipat and that is the exact point. (for the uninitiated, Sonipat violence (agitation for reservation in Govt Jobs) led to some 30 deaths and loss of 20,000 Cr ($4bn) worth of property.)

Whole India seems to be living in a 24×7 reality show where every second a new more sensational event happen numbing us even more and game of whataboutery continues.

There are millions of case pending and getting added, but SC bench find time to hear petition like if Red dresses shall be allowed in India.

So for a moment, get way from this whataboutery and ask yourself a serious question ? Are you really comfortable with state of security – do you think Indian state delivers quality of life – Safety, Justice, accountability or these days – clean air?

Indian archaic system of governance has failed and collapsing. 

When somebody says – let the land of law takes its own course, its invoke yawn from both sides ie criminal as well as victim as nobody remembers as when was the last time justice was delivered. 

Indian justice system has achieved a unique feat in the world where innocents are afraid of it while criminals remain brazen and laugh at it.

Denial of justice to Phelu Khan, Ankit Saxena  et all is not any conspiracy. 

It’s equal treatment to all natives without gymkhana connections. 

So stop this whtaboutery and start asking hard questions before each one of us end up being the main character in 24×7 reality sensational show!

The end

Entrepreneur Diary

यह हार एक विराम है
जीवन महासंग्राम है
तिल-तिल मिटूँगा पर दया की भीख मैं लूँगा नहीं
वरदान माँगूँगा नहीं

स्मृति सुखद प्रहरों के लिए
अपने खंडहरों के लिए
यह जान लो मैं विश्व की संपत्ति चाहूँगा नहीं
वरदान माँगूँगा नहीं

क्या हार में क्या जीत में
किंचित नहीं भयभीत मैं
संधर्ष पथ पर जो मिले यह भी सही वह भी सही
वरदान माँगूँगा नहीं

लघुता न अब मेरी छुओ
तुम हो महान बने रहो
अपने हृदय की वेदना मैं व्यर्थ त्यागूँगा नहीं
वरदान माँगूँगा नहीं

चाहे हृदय को ताप दो
चाहे मुझे अभिशाप दो
कुछ भी करो कर्तव्य पथ से किंतु भागूँगा नहीं
वरदान माँगूँगा नहीं

  • श्री शिव मंगल सिंह सुमन

Liquidity and Businesses

Liquidity is like blood, sudden loss of it can kill an otherwise healthy company/body

Companies die due to liquidity issues not because of business model issues.

Indian economy is having severe liquidity crunch & like body – a prolonged loss of blood leaves permanent scar

PSUs and theory of Trust

A nation which doesn’t trust its people, will have its own enterprise while a nation which believes in its people will invest in them. That is the fundamental difference between India vs US or China.

Indian Govt created PSUs, funded them and crowded out private capital and innovation while US dept of defence helped launched multiple defence behemoths and even today are key driver behind the success of likes of Space X etc ..

Equity & Debt

Equity is forgiving and ignore all sins / exuberance while creating reward for all parties but debt like truth is stark, doesn’t allow even marginal error and generally destroy all, its rewarding only to disciplined souls or one backed by again unlimited equity.

Flirtation with debt has rarely ended well be it individuals, corporates or nations.

Debt which ideally shall only be for creating capital assets or meeting capital expenditure, always end up funding consumption or revenue expenditure, and hence doesn’t end well.

Debt require discipline which by design Nation, corporates rarely have as the cost is generally not paid by the one who take the decision of debt. Hence its a asymmetrical proposition – all rewards but no pain and for next in command all pain and no rewards.

India, The land of experts and committees

  1. Indians love committees. 
  2. And more so Governments and politicians.
  3. Whatever the situations or crisis, a group of people at many level are huddled together to solve this.
  4. And a committee is the perfect solution. A set of experts who seems to know finer nuances debate together and bring out a best solution after doing a good “brain storming.”
  5. Seems like that committees are most beautiful product of democracies and there are committees of all type with all fancy names and titles 
  6. There is High empowered group of ministers committees, there is committee of secretaries, there is committee of experts, there is a committee of state ministers, there is committee of assistants, there is committee off mohalla people also 
  7. Interestingly while there might by 100s of committees with variety of people and team, they rarely change the game or able to bring disruptive ideas and reasons may be many 
  8. First and foremost, generally experts or people handing a status quo are not the best people to disrupt it. 
  9. Think of US President forming a committee in 2003 to imagine innovation in mobile 
  10. Which experts would have been natural choices ?
  11. CEO OF Noika, Palm, Ericsson, Sony, Alcatel, Blackberry- in fact in 2019, it is hard to recall champions of Mobile in 2003
  12. Would they have invited Steve Jobs from Apple or senior guys from other leading brands of today. 
  13. Or a team to discuss banking reform and ease micropayment in 2010!! Would PayTM be a part of same or top executives from HDFC / ICICI / SBI driven it. 
  14. But that is the not the only flaw of teams / committees that look at rear view mirror and past rather future
  15. The even worse outcome of a team / committee is the outcome which is always a compromise, a timid agreement or the common minimum program
  16. An agreement, a consensus is fundamentally flawed as it has already devoid of hope and is more suited to fulfilling agenda, personal relationship or timidity of the room than that of hope and bold new dawn.
  17. In committees, either the orators win, or the strongmen. History has shown that in fight between phosphor and wrestler, it is always the wrestler which wins but not that the solution by wrestler is the the best solution. 
  18. And one of the biggest flaw is lack of accountability and ownership. It is decision of group, so nobody can be blamed for it as its always the group, and hence there is no skin in the game. 
  19. A decision without skin in the game is like headless chicken and is doomed for failure from day one while protecting its decision makers from any of negative consequences. And hence no soul.
  20. Hence a committee or group of experts is always a path to backward and leads to nowhere 
  21. No nation , or company or society has been built by a team of experts but by leaders and their core group who can dare to imagine and bend the spoon. 
  22. Remaining societies / teams / companies / nations just form the committees and study the outcome. 
  23. The End