Layman brothers…

There is a reason for this post which holds absolutely no substance whatsoever except for a title that sounds suspiciously like my last post.

Maybe by this evening or so, all will be made clear…

Lemon brothers…

The newspapers, the BBC and pretty much any other media I have happened to glance at in the last 48 hours are full of stories about the meltdown in financial circles. I guess people did not really expect that Lehman Brothers will be allowed to go bust or the Merill Lynch will go up for sale but the coverage has been amazing.

For a long time my relationship with the banking industry has been confined to me, my chequebook, my debit card in later years and the occassional visit to deposit/withdraw money. Only recently have I been trying to learn a bit more about what goes on in these circles and very often I find myself in awe at how the system works. It’s the ultimate in value addition and trading. It is the kind of thing that takes a sheet of paper normally worth a few pennies(or less) and makes it worth hundreds, thousands or even millions simply by printing a share certificate of the right company at the right time. This humble sheet of paper, now worth such a bloody lot can probably be used as security to get a loan to buy a house and the person who gave the loan can then “sell” the loan (I never even imagined such a thing could be possible) to someone else.

The problem of course arises when the humble sheet of paper turns out to be of a company which has a Lehman brothers style fate and goes back to being worth a few pennies. Unfortunately someone has risked a loan on this piece of paper, and if things like this happen on a large enough scale, we get what is being reported in the media nowadays.

The amount of “notional” value attached to anything in the financial industry is mind boggling. So it the flexibility that comes from being so dependent on notional values. I can’t imagine any other industry where people can sell what they do not own(as some short selling Hedge funds may do), or try to buy things that are not produced(people speculating on next years rice harvest). Everything is a number, once it was in a book, nowadays its probably on a screen.

The heavy dependence on the notional is probably what makes financial firms so vulnerable to common rumours. The CEO of a company that actually manufactures something has it easy, if he hears any rumours that his firm is on the verge of collapse, he could probably show his shareholders that the factory is busy, the order book is full, the sales to retailers are healthy and a tour of some supermarkets shows the companies products being sold well. Once he does this, most people would be convinced and keep their investment in place. The CEO of a bank on the other hand would simply have to throw up his hands and say “trust me”. I don’t even think a bank could open a vault somewhere and show people a stack of cash, most of their deposits are probably given to someone to buy a loan on a house leased from someone else who bought it by taking a loan using his wife’s jewels as security or something. He could show his shareholders the number on the screen, but they would just say “yeah right” and ask for their money back. The more people withdraw their money, the stronger the rumour becomes, even more people turn up demanding their cash and down goes the back.

Its an interesting world and I look forward to following the developments. Just hope that my bank is safe…

Musings on science…

In the last few years, life has taken a direction which, when I left university after my undergraduate degree, I never really thought it would take. At that time, I pictured myself working as a software engineer, probably going on to management etc the usual way. Now I find myself doing a PhD seriously considering a career in scientific research. Obviously my perspective on science has changed and listed here are the most important changes.

“What’s the use?” – Wrong question
Back in my undergraduate days, we used to swagger around pretending to be the practical business oriented types who thought that whatever the PhD guys did was really useless. It was quite routine whenever we met a PhD student that they used to start off telling us about how they studied effect of different coloured light on metallic thin films or something and we used to ask, with a smirk, “what’s the use of this?” and then smirk some more at how they had to think a lot to come up with some good answers.

All these years later, and partly into a PhD programme myself, I realise the folly of my ways back then. That is because most research is not done with a specific applications in mind. There is just a general sense of direction, but not always a specific goal. There is no better example than that of the research by Friedrich Reinitzer on examining the physico-chemical properties of derivatives of cholesterol extracted from carrots. Reinitzer discovered that the compounds exhibited two melting points and has curious properties like ability to reflect circularly polarised light and to rotate the polarisation of light. He called these materials “Liquid Crystals” and after a case of one thing leading to another, I am today sitting here writing this on a laptop which has a display made from liquid crystals. If anyone had asked Reinitzer what applications his research had, I wonder if he has said that we could make displays from them.

Moral:In science, first attempts are made to understand and control phenomena around us. Once we have understanding and control, THEN we find the applications.

The means and not the ends

A typical scene at the start of a PhD is the new student sitting expectantly in front of his supervisor. the supervisor then proceeds to describe the project as he sees it. The description has a lot of impressive sounding jargon, though it isn’t really a sales pitch. Now the jargon motivated student goes away, breaks down the project aim into manageable bits, solves the first one and then goes back to his supervisor feeling pleased with himself and then learns the second lesson…

In science it is not enough to “solve” a problem once, it is necessary to demonstrate that it can be repeated and a bigger plus is if a mechanism for controlling it can be illustrated. Saying something like “I got red coloured liquid crystals” could mean that you achieved that through systematic work, or you achieved it because fortune was smiling on you that day. Saying “I did blah blah and got red coloured crystals, repeating the process five times yielded red liquid crystals every time” is better because now there is a specific improvement in the body of knowledge on the topic. It means someone else who needs red liquid crystals can rest assured that if he invests his time in following the process described, he will get what he wants. Achieving the goal is important is science, but what is more important is that every step along the way is systematically documented and adds value to scientific knowledge.

Science progresses in baby steps, a bit at a time. Very often the original goal set out will not be achieved, but if the process is followed meticulously, the whole endeavour is still a success.

I am not even a third of the way into the PhD and I am sure I will learn more, but at the moment, I am too sleepy to continue

How do they get away with it??????

Here is an article about what the new political party in town, the Maharashtra Navnirman Sena, led by Raj Thackeray is upto. It is interesting to notice the language, he says the police should “think twice” before they lathi charge any of his party members who are out to make sure that shop keepers who do not have boards in Marathi “face their wrath”.

I am surprised at the attitude. Here is a guy who is pretty much asking the law enforcement agencies to turn a blind eye while his party probably goes about destroying shops that do not have a Marathi board. I wonder what next, everybody MUST have a statue of Shivaji in their house, anyone entering Maharashtra MUST pass an exam on Maratha history…

I am quite gobsmacked about what goes on in the world.

I am also interested in knowing how people can swallow this guy’s stories and joins his party, thus adding to it’s political clout.

Big bother…

Here’s a link I came across in BBC a couple of days ago about Jade Goody, the person who became famous for the supposedly racist comment on the reality show Big Brother. To “make amends” with the Indian population supposedly, she is now planning to join the Indian version of the reality show and what’s more, she is getting paid 100,000 pounds to do that.

News like this makes gasp with incredulity, it makes me cringe and it makes me wonder if humans are indeed an “intelligent” species. Here is hard evidence that a person can shoot to celebrity purely by acting as if they are brainless twits(as her wikipedia page says, for all it is worth), then make supposedly racist comments, which draws more flak(and celebrity coverage) and then gets paid a huge packet to participate in an alternate programme of the same format to “make amends”. Once again, I lament the fact that people are so celebrity crazy and have so much free money to waste that such programmes and the associated paraphernalia are easily supported.

I first became suspicious of the reality of reality TV when I noticed Shilpa Shetty’s biography on UK bookshelves barely a week after the whole “racist” event. Surely there has to be some organisation in that? Surely there isn’t anyone who could have sat down and in a week written, published and distributed a book to stores? And to think that there is a market enough for this organising this whole charade, they really must be laughing all the way to the bank. It’s enough to shake my faith in human intelligence a little bit…

Given five minutes I can think of thousands of people who are truly more deserving of receiving such huge amounts of money than Jade Goody. Scores of teachers who stick it out in the poor schools, the voluntary workers who work for a pittance purely for the pleasure of seeing their efforts and abilities benefit their fellow humans beings. It seems so perverse that these people who are actually doing good work should have to scrounge for money while reality show characters rake in the millions by acting like idiots. Maybe we should all line up for reality shows and then once the scarcity of the “real” professionals hit in, some more sense will be beaten into the media and everyone else.

Now ain’t this cute? :)

Most of the websites I have come across that show the Olympic medal tables list the countries which have won more gold medals above those who have won the larger total haul.

Some exceptions are the Yahoo US site (only the US site mind you) here and the CNN site here who list the nations in terms to total medals won.

Quite convenient that in both these cases the US comes out on top

Restart blogging….

It’s been an extremely long time since I last blogged and loads of stuff has happened during that time. My parent’s visit ensured a month of a full house and some travelling to a few pretty places in the UK. I got to admire the way the Brits maintain anything that can be remotely consider beautiful. If there is a place around, they make the area into a nature park, allocate parking, mark walking paths and may even deny building permission in and around it just to prevent construction to destroying the area. I hope the Indian officials learn a few of these tactics….

The olympics are on and I am again following the progress of the big three in the tennis world(Nadal, Federer and Djokovic). As usual I am a die hard Federer fan, but I have a feeling the Olympic gold is going to evade him. I don’t know the reason, but Federer’s game doesn’t seem to be very strong this year, he doesn’t seem to be too aggressive on the breaks and in general appears subdued, while Nadal is busy hitting impossible shots from impossible court location into impossibly fine corners of the court. It’s almost as if he can do nothing wrong. Djokovic is also a threat, especially after he just beat Nadal at the Cincinnati masters tournament a week or so ago.

This was a random post just to get myself started again…some more directed posts will follow.

Nadal – Federer yet again…

What can I say? These two seem to be making the world of tennis monotonous and interesting at the same time

In a moment of infinite wisdom though, I will not even attempt to describe the Wimbledon 2008 finals which Nadal won yesterday. Simply because it cannot be described. I could probably throw around some words like amazing, sublime or magnificient, but the bottom line is that if you watched it, you will know what I am talking about. If you missed it, then there is not much you can do except feel sorry for yourself.
Nadal won the championships yesterday but Federer’s performance showed that he can hardly be written off the way people had started doing after the French Open and yet again I find myself praying that both of these players go from strength to strength, just so that we can watch them again and again and again.

For me, despite being a staunch Federer supporter, the loyalties had started to blur at the end of the match and it did not really matter who won because both of them had simply given everything they could.

The true winner in yesterday’s final was the sport of tennis itself.

Sitting-on-the-fence writing

Comments on my two earlier posts about the Ambani residence and the Rooney wedding pointed out that I may actually be contradicting myself. I realised that the justification for these two posts are long enough to form a post themselves and being forever keen to get more blog-mileage, here I am

First things first, while my saying that we should not bother about the Ambani residence and then a few days later ranting on how the rights to Rooney’s wedding photos were sold for 5 million dollars(or pounds I forget which) may seem contradictory, they are in fact dealing with fundamentally different things. From what I hear, Rooney is a good footballer and therefore has earned his millions. I do not begrudge the man if he wishes to spend millions on his wedding or if he wishes to buy his bride an island as a gift or whatever. I also do not blame the magazine who bought the rights to the photos. What I DO find extremely revolting is the fact that so many people in the world can be idiotic enough to create a sufficiently large market that the magazine in question starts seeing the photo rights as being worthy of a 5 million dollars spend. The magazine is not really at fault, it is merely making money from the horde of suckers it sees around it.

The Ambanis, on the other hand, built a house using the millions they have earned. They could have done it because they wanted to or they needed all those storeys of space, I really cannot comment on that. Sure, the house may not have much extra utility compared to smaller one, but I have a whole lot of opinions on this matter and the private jet thing which would fill a post by itself, so maybe sometime later. If done for a purely personal reason, then I cannot find fault with it.

There could be a second reason why the Ambanis decided to build their house, namely, because they want to make a show of their wealth to people around them. If this were the aim, it brings us back to the same celebrity craze which we humans seem to have and which I find revolting. People would look at his house and go “ooh”, they would probably buy a newspaper just because it has pictures of the house interiors, all of it simply to experience the vicarious pleasure of seeing how those better off than ourselves spend their money.

If people did not buy that magazine with Rooney’s photos, no footballer will ever get offered such a wad of cash. If people walked past a house that was built to impress others and say “oh! did not notice you there”, there will be fewer such houses around. Those that will be around will be built purely because the occupiers/owners wanted them that way, which I think is a valid enough reason.

Therefore, if the Ambanis built the house that way because they truly felt the need or desire for it, good for them and may they spend a happy time in it. If they built it to show off to other people, then I blame the people who fall for it and do go “ooh” because they are simply creating more incentives for people to build such behemoths. The applicability of this argument to Rooney’s wedding and the rest of the celebrity fuelled nonsense is just too obvious in this case.

And that is where I stand on the matter…

How much is a billion???

Thanks to Arthi for this link about the discrepancy in the British and the American meanings of the word “billion”.

We were first told about this by a friend of ours at a get together and needless to say, we pooh-poohed it and put it down to his havign drunk too much wine. It is surprising that such confusion can exist, though I am sure it is not really affecting any of the world’s markets or anything. I just hope that the worlds population is being counted in the American version of the billion

A notable point is that both these systems, with the multiples of 10 or 100 or 1000 were invented by the French. In this regard, I find the French to be quite remarkable, as they develop very simple systems that easily avoid confusion. They use the metric system as against the pounds and miles used in UK/USA, they use 24 hour time instead of am/pm and in most of their databases, they have the person’s surname in capitals, so when an outsider comes in and takes a look, he/she knows instantly which is the surname without having to maintain two fields in the database records.

Vive la France!!!