Sunday, January 31

2 States - Book review

Read Chetan Bhagat's latest novel "2 states". After i finished the book i had just one question in my mind: "Mr. Bhagat, you started your writing career brilliantly. Why are you writing just for the sake of writing?"

2 states is spun around the same old issue of inter caste marriage. Its like eating the same old butter chicken but with a different garnishing. Mr. Bhagat says that he wants to send a message across by means of his book. Except for a little flavour of that message the book failed to evoke any emotion towards the message that the author wanted to convey.

The book lacks the plot, Narrative is brilliant towards the begining but is mere average towards the end. The narrative of the book till page no. 154 is ultimate, i felt like kissing the hand that wrote such a hilarious narrative. But post page 154, the book was pathetic. I found it hard to put the book down once i started but after page 154 i had lost interest in the book.

One can read the book if he/she is a die hard Chetan Bhagat fan otherwise go and watch "Ek Duje Ke Liye", its far far far better. 2 states does not seem to be the product of mind that crafted " 5 point someone".

Wednesday, January 20

Chicago Booth Faculty -- Lecture -- Financial Crisis

On Friday {Jan-15} i had the opportunity to attend a lecture by Raghuram Rajan. Raghuram Rajan is the Eric J. Gleacher Distinguished Service Professor of Finance at the University of Chicago’s Booth School of Business.

Dr. Rajan is also currently an economic advisor to the Prime Minister of India. Prior to resuming teaching in 2007, Dr. Rajan was the Economic Counselor and Director of Research (in plain English, the Chief Economist) at the International Monetary Fund (from 2003).

There were some 32 Booth alums also present. Raghu spoke on "The Financial Crisis and Beyond : Challenges for India and the Global Economy."

Unlike other people Raghu was not blaming Sub-prime alone for the Financial Tsunami that de-railed the global economy in 2008. Raghu shared other factors such as "US Educational System", "Export oriented economies such as Germany, Japan, China", "Compensation system of big banks", "Competition among CEOs" etc.

According to Raghu the rising gap between income levels of High school pass outs and that of people with higher degrees forced the US govt. to frame certain policies that led to this Financial crisis. There was an oversupply of people who were high school pass outs and this oversupply led to a net reduction in their remuneration. While, people with degrees such as M.S and M.B.A saw their salaries rise by approx 25%. Moreover, there is a continued under-supply of people with higher degrees in US and this is creating a greater than ever rift between the earnings of two income groups.

The problem started way back in 1991 when un-employment rate rose above 10% in US and George Bush Sr. lost the election. The congress forced Fed to cut the rates so that economy could be revived. Congress believed that reducing the fed rates would have a positive effect on the economy and the businesses. As the surplus liquidity would increase the spending power of lower income groups.

In effect the reduced interest rates forced people and businesses to take risk and invest the money in instruments that were traditionally considered risky. Also Mortgage backed securities were developed by leading US i-banks such as Merril, Bear Stern, Lehman etc. In nutshell, the reduction in interest rates provided liquidity to people who in turn invested this money in products such as CDS, MBS etc {Collaterialised debt securities, Mortgage Backed securities}.

To add to the woes the compensation system allowed the traders to take bigger and bigger risks. For, there were big rewards if a trader made money but no penalties if a trader incurred loss. Raghu proposed that the compensation system needs to be altered to bring the sanity back to the market.

Raghu was particularly critical of Bear stern, Lehman and Citi group for placing big bets in 1990s. The bets placed in 1990s paid off but laid the foundation for future problems. By 2007 things got out of control and BS, Lehman and Citi were the biggest losers. Also, Raghu pointed to the competition between CEOs of big i-banks. He was critical of John Thain because Raghu believed that John conciously or unconciously competed with CEO of Goldman Sachs over the compensation. John matched his and his traders compensation with that of traders at Goldman but failed to produce the profits equal to Goldman.

Finally, Raghu drew the attention of audience towards the export oriented economies such as Japan, Germany and China. These economies were highly dependent on US for their own well being. When US sneezed these economies caught cold. This over dependence of three big exporters led to the collapse of global economy. The consumption in US suffered and led to problems for Japan, Germany and China.

Raghu was also critical of China throwing jabs at US. He believes that US engagement in wars was preventing US from acting sternly against China. If US simply imposes an import tarrif on Chinese goods, the Chinese economy would be in trouble.

Post the lecture there was a brief QnA session followed by the networking reception.

Friday, January 15

Statistics -- GMAT

I guess all of you must be familiar with the formulae of Mean, Median and Standard Deviation {S.D} ... even if you are not its fine!! Good news is that GMAT does not test your knowledge of formulae involved..Statistics questions do pop up in the exam and following tips might come handy:

1. Standard Deviation gives the dispersion or spread of the data around its mean
* simply means that if standard deviation is large data is spread over a greater range around mean...or a lot of  the data points are not close to the mean value

2. Adding or Subtracting a constant value from each term in the set has NO EFFECT ON SD

3. If each term in the set is multiplied by a number > 1 then SD increases

4. If each term in the set is multiplied by a number < 1 then SD decreases

5. If each term divided by a number > 1 then SD decreases

6. If each term divided by a number > 0 but number < 1 then SD increases .
let us say we divide each term by number 'n' , 0 < n < 1 then SD increases

7. Changing the sign of all terms in set has no bearing on SD..

8. If you are given multiple sets of numbers and you have to find out the set with largest and smallest SD just look at the set where the difference between the terms is greatest and the set where the difference between the terms is smallest respectively..

{ i hope the wording is not confusing, i know it sucks brevity per se :) }

Tuesday, January 12

Romeo - Juliet by Braveheart

Written for someone special, who has already got the flower and read this post :)

Many things happen in our life “by chance” and few “by choice”,
We had met “by chance” and are still together “by choice”,

“By chance” I got this flower for you and as I kept it on my Car’s dashboard

I noticed dew drops on its petals,
“By chance” I heard a sigh, it was this flower who was crying,
“By chance” he started talking and told me that you are looking at my tears and not the dew drops,
“By chance” I had mistaken tears for dew drops,

The story that I am sharing with you is “by chance” Romeo’s story,
“By chance” the flower that you are holding is “Romeo”, { i gave her  the flower }

“By chance” Romeo spoke to me and “By choice” shared his story
Romeo was a seed few months ago and so was Juliet,
Both were colorless, without any fragrance and had no feelings
“By chance” a gardener sowed both of them next to each other.
“By chance” both of them got Sunshine, Rain and Mother Earth’s Lap

“By choice” both decided to Blossom,
“By chance” both blossomed
“By chance” Romeo grew up handsomely
“By chance” Juliet grew up beautifully

“By chance” Romeo and Juliet grew up together
“By choice” they started loving each other
“By choice” they touched each other when breeze swung them,
“By choice” they spent sleepless nights under the blue Moon,
“By choice” they danced together when it rained,


One fine day, “by chance” the gardener who had sown Romeo and Juliet, plucked them,

“By choice” he sold them to a florist,
“By chance” the florist put Juliet in a bouquet and Romeo in a bucket full of water
“By choice” they kept on looking at each other,
“By choice” they cried,
“By chance” I bought Romeo; “by chance” I mistook his tears for the dew drops
“By chance” Romeo shared his story with me and “By choice” I went back to florist
“By chance” I was too late…Someone took Juliet away
“By choice” I was silent and “By chance” Romeo understood what my silence meant

“By choice” I decided to bring a smile BACK on Romeo’s face,
I decided to take him to Juliet and the way Romeo had described Juliet

I thought of someone who resembles his Juliet,
“By chance” its you …..

“By chance” Juliet had pink cheeks like yours
“By chance” she was as innocent as you are
“By chance” your fragrance compliments that of hers’
“By chance” Juliet was as gorgeous as you are

Romeo won’t last more than 3 days and will leave us to mingle with Juliet
“By chance” would you mind keeping Romeo with you?

“By choice” Smile…for you will touch Romeo’s soul….
Smile…for you may realize that life is short….

Smile…for you may smile now when you are with me…

Monday, January 4


New year brings a lot of resolutions. People make all kinds of promises to themselves such as "I will cut down on junk", "i will quit smoking", "i will study hard" etc etc.

For years i have been making resolutions and breaking them at will. So, this year i have decided not to create a wishlist. I would live each day to the fullest. I would be a kid again and will get excited when i see the rainbow. I would write on anything and everything that would make me happy.

I would enjoy every sip of my coffee, every bite of my pizza. I would do what i love to do rather than simply piling on.

I will focus on 2-3 things that make me happy rather than running around aimlessly.

With that i wish all of you a very happy and prosperous 2010...