Graduate Life at Cornell

I have moved...

2014-07-11T18:41:00.000-07:00

Rupee takes a plunge

2013-08-20T01:08:00.002-07:00

Recently rupee rolled down against the dollar, with the dollar being valued at over Rs. 63. This devaluation comes at a prime time when I've started working and so it certainly is a boon. Though it's important to understand why this is happening, is it a big deal and what is the future going to look like.

The value of Dollar vs Rupee is a simple case of supply and demand. The rise of the Dollar's value against the rupee implies that people are converting Rupees into Dollars. This cash flow is happening for a number of reasons -
The US Federal Bank is probably going to cut down on it's quantitative easing. (Quantitative Easing, or QE, is a phenomena in which Fed buys central bonds and hence maintains their high price which keeps the rates low. This incentivizes people to invest their money elsewhere like in stocks or maybe buy a house or a car. This helps in revitalizing the economy) With the Fed suspected of cutting down on this venture, investors plan on flocking back to the US bonds as a safety haven and hence taking their money out of other countries.
The Indian economy also doesn't seem to be doing to well. It's account deficit (which is the net value of imports - exports) has ballooned to about 4.8% of GDP, i.e. $88.2 bn. The stock markets seem sluggish and there are impediments to FDI in different sectors. The economy grew at just 5% in 2012-13, the lowest in a decade. This is leading foreign investors to take their money out of India which is leading to a drop in the Rupee.

As a result, Indian bonds have become less attractive and hence the yields have risen. Foreigners have taken out $10bn since May 22 and the 10 yr bond yields have risen to 9.23%. This means that the central govt will pay interest @ 9.23% if it borrows from anyone. This rise in interest has also led to a rise in interest across the board with both savings and loan interest rates rising that will make getting a loan more expensive.

Now, on the other hand we have a strong 25 million Indian diaspora that is taking advantage of this rate and pumping their homeland with much needed foreign reserves. Volumes in the last few months have been 20-30% than that seen during regular months.
The Indian government also recently introduced certain fiscal changes that restricts foreign investment by Indian citizens and corporations and it also restricted imports of gold that led to a jump in the price of the bullion.

It seems clear that the solution is a higher growth to attract the Foreign Investors back. The Rupee will probably continue to slide to 64-65 and maybe to 67 but then certain sectors need to be opened to FDIs and exports should be energized so interest in the Indian growth story is back.

Until then.. NRIs - Cash Out!!

I saw a Cop!

2013-04-28T11:20:00.001-07:00

And he went zooming past, on the deserted roads in Richmond district, as if with some urgent sense of purpose. And I'm not surprised...

West Coast, Bay Area, SF - these terms always carried away my mind into a world of sunny beaches, beautiful hikes, outdoor sports, night camping and nature trails, all centered around a lively and thriving city. And with that mindset I always wanted to work here. And now, I am!

As the time neared, I was quite apprehensive about leaving NYC as I felt I had got used to it. Quite the same way, in striking contrast, as I felt about leaving Ithaca (upstate NY, for those of you who don't know)! It didn't sink in that I had actually moved until I landed, pulled my luggage from the conveyor belt, hoarded a shuttle and came at the hotel I'd booked. It all seemed perfect - a bright sunny sky, lots of stores and restaurants around and happy faces. I had done my homework and had booked the day to go look at a few listings where I would be establishing my abode for the foreseeable future. I start off from Taylor and Post where I had arranged some temporary accommodation and start walking south west.

As I came out of my hotel I was absorbed in the revelry around the place and didn't feel that I had left New York at all. I started walking admiring the people, the buildings, the shops, streets, but most importantly, the weather. My thoughts were suddenly disturbed by a fowl stench, and, as my neurons registered it, a familiar one, from the cigarette a guy was smoking on the streets. In an utmost expression of joy he shouted "Hey buddy. How are you doing today? Enjoy Life!" Yes... it was something else, camouflaged as a cigarette. And then I was pulled out of my thoughts and sensed the transition that had brought me into a different neighborhood. I was scared for a bit and thankfully I had the Sun watching my back. I notched up my pace and entered a pretty silent building. It seemed well kept and the manager showed me the apartment. The windows of the apartment opened out to face a blank wall, a completely white wall, and that was the only view from the place. Next.
The office manager cautioned about the region and advised that his building was right at the edge of a neighborhood called tenderloin that is known for its notoriety. The area on Jones St. between O'Farrel and McAllister is what he suggested to avoid. And that was when I began to understand how stark the boundaries between neighborhoods in SF are and how distinct their culture is.

The next few days...
The next day I spoke with my friends who had inhabited the area for a while and asked them about their recommendations for places to live. Most of them had settled down in the Bay area and had little knowledge about the neighborhoods in the city. I thought of then doing some research online to figure out the pros and cons of different areas and headed to a Starbucks close to where my office was going to be. It was closed. AND - it closes at 6 pm on weekdays. I was almost shattered and couldn't help feeling bottomed out and I missed the zillions of results that yelp spat out at "24x7 cafes" in NYC. "Nearby". I decided I needed some freshness and some change and I moved over to stay at my family's in Hayward City.

The week turned out to be pretty interesting as I worked in the day and had fun with my little cousins at home. At the end of the week I found a place to live at Haight. My colleagues had a nice impression of the place with the different eating and hanging joints and that helped me feel positive. But I guess a difference in perspective was again not on my side. As I roamed about Haight trying to explore around I wasn't completely at ease in my mind. I had felt quite similar as I had come out of 16th St. at Mission on BART and it suddenly seemed quite clear. There was quite a visual element to the buildings. Almost all of them were really graphic with the most plain ones also having some graffiti. All these areas - Tenderloin, Haight, Mission St. had some extreme visual graphics on the building walls - hypnotic patterns, dark designs, distorted figures of human body, graphic visualization of "plant leaves", hippie color combinations, etc. To further enrich this appeal these areas were populated by a different breed of adventurers some sporting braided hear, tattoos all over face, pierced lips and eyebrows, heavy beard, half torn clothing, etc. Add on to the fact that many of them have a very stout built, in the first few days I used to feel mildly threatened with their presence. Even as a New Yorker (if I may call myself that) who has seen his share of unique aspects in people, the ratio of such a breed together with their high visibility and coupled with an extremely graphic setting of the visually rich images on buildings construes an uneasy threatening feeling, especially for someone new. Like me. I remember the first time I walked down on Market St. towards Van Ness and after the 4th-5th st. the neighborhood took a sudden transformation. I wasn't surprised as the maps indicated I was at the border of Tenderloin. There were small groups of loud and stout men lingering around, smoking stuff and having music play around. Another group of street kids, the kind who looked up to the former group of men, huddled together with a basketball taking turns on passing it around without any regard to passers by. Add to all this a kind of ghetto appeal that the area has with bright and dark colored walls painted with some abstract art form and with the stores showcasing distorted mannequins with separated limbs sporting respective body accessories. I have never set foot in that area again.
One day I saw a guy walking on the streets completely naked with just a piece of cloth hanging on one side. The other day I was walking on Haight with some take out Thai and after every 10 steps someone would ask "Do you need that food"? I either ignored or gave a rather imperceptible nod without even looking at them. Not all of them were mature, respectable people - one of the "street kids" stomped his skate board that made a loud noise and as my reflexes made me turn he yelled "so you CAN hear me. The next time I ask something, you reply!" I scampered my way back home and was really disappointed with the worst Thai I had tasted. I wish I had actually given it away!

So yeah... the next week I went to check out the Richmond district and it turned out to be quite a residential place with rows and rows of houses lined up. And there he was... a cop, rushing towards the city with a sense of urgency. And you know now why I wasn't surprised!

Gathering my own data

2013-03-18T16:48:00.000-07:00

I have recently started refreshing my knowledge in Perl and have, in the process, re-realized the amazing scripting power of linux. There's a whole lot that can be done with file structure and file contents than what is remotely possible in Windows. Keeping that as a separate topic I'll first dive into using Perl to connect with data sources to download stock quotes and store them in a mysql database that can be used for further analysis.

Creating a MySql Database:
I found a very useful resource on the web to help understand MySql especially for those who have a faint memory from using it in the past: http://www.yolinux.com/TUTORIALS/LinuxTutorialMySQL.html
This tutorial gives a very elaborate overview on how to obtain MySQL and then how to create and modify user accounts and databases.
After getting acquainted with the basics this tutorial will help to create the actual database and provides the syntax on how to insert data using Perl into the just created database: http://scriptingmysql.wordpress.com/2011/08/05/inserting-data-into-mysql-with-perl/

Obtaining Stock Quotes:
I looked for many different alternatives to obtain stock quotes using Perl and I found the Finance::QuoteHist package to be quite relevant to this purpose - http://search.cpan.org/~msisk/Finance-QuoteHist-1.19/lib/Finance/QuoteHist.pm

Final Code snippet:
With all the above information I wrote the following code to obtain the ticker symbols from a local file and then fetch the stock quotes and store them into a local mysql database:

#!/usr/bin/perl

use Finance::QuoteHist;
use DBI;

# Obtain the ticker symbols from file
my $tic_file = '<path of file>/tics2.txt';
open (fh, "< $tic_file"); #Note the syntax
my @lines = <fh>;
close(fh);
#my @tics = @lines[0..99];
#print $#lines, $#tics;

#print "@lines[1..100]";
$dbh = DBI->connect('dbi:mysql:PerlTest','root','<my password>') or die "Connection Error: $DBI::errstr\n";
$q = Finance::QuoteHist->new
(
symbols => \@lines,
start_date => '03/14/2013', # or '1 year ago', see Date::Manip
end_date => 'today',
);

# Quotes
foreach $row ($q->quotes())
{
print "@$row \n"; #double quotes displays properly
($symbol, $date, $open, $high, $low, $close, $volume) = @$row;

$sql = "insert into SampleQuotes (ticker, date, closing) values ('$symbol','$date','$open') ";
$sth = $dbh->prepare($sql);
$sth->execute() or die "SQL Error: $DBI::errstr\n";
}

There is a whole lot that needs to be done in this script around Error Handling, vis-a-vis connection issues, duplication issues, missing data, etc and that is going to be the next topic.

Let's be humans

2013-01-20T18:26:00.002-08:00

I don't even know where to begin talking about the incident. They both were just regular people, like you and me, doing something completely regular, watching a movie, on a very regular day. Little did they know what the night held for them. Every moment from there on they, in fact I and the whole of India, would have wished for them to change any one decision they made - maybe a different day for the movie, a different theater, a different time - but sadly they didn't. As I try to recall even the description of their trauma in the media my brain fails to comprehend, even in its wildest of imaginations, the inhuman treatment that was vetted out to them. How could a human forego their entire value system and loose their senses to such an extent that, forget treating another human with respect and courtesy or even indifference, they not only get insensitive to the pain and suffering of another person but they actually participate in the barbaric act that causes such pain? Even as I write this I feel my body contracting as I imagine the excruciating pain she suffered. And what breaks my heart is to think that she isn't the only one. Not even the tip of the iceberg. Hers was the story that caught widespread attention and united the whole nation for a common cause but sadly her story mirrors the atrocities that many innocent girls face throughout the nation.

The incident happened on Dec 16th, New Delhi - the unsafest metropolitan in India. She was with her friend and they finished watching a late night movie. The scarcity of public buses and probably the harassment by Delhi autos, who would charge astronomical amounts to exploit the situation, prompted them to take one of the private buses to go back home. The bus had tinted windows and, as they recount, they were lured onto the bus. What ensued in the next two hours can not be imagined as a part of even the most horrible scene behind the reels. Six men, all intoxicated, illiterate, shameless and wicked with lewd minds indulged in the most abhorrent act, treating the girl worse than an object, an object you were about to throw. The driver of the bus paid no heed to the imploring cries of the girl as he sped past stipulated stops and circled some deserted stretches to avoid catching attention. The men, six in number, overpowered the guy, stripped him off his clothes and beat him, making him incapable to even move a muscle in an attempt to salvage the situation. Then they stripped the girl and used an iron rod to conduct such deplorable acts that no one can classify them as, not only humans but, any creature capable of showing any respect towards one of their own. It is beyond my comprehension that how one can be so involved in revelry at the cost of someone else's life that they lose the emotional connect and a sense of sympathy to the resisting shrieks and struggle of the another person. And after two hours of extracting all the life out of the girl they disposed her and her friend's body off on the road in the biting cold. To even find a metaphor to describe this act fills my brain with muck and any anger or hatred expressed towards this brutal act can never compensate for what those two people suffered. The girl was transported to a hospital in Singapore on grounds of treatment where she succumbed to her injuries. From the testimony of the guy, he wasn't even offered any treatment and he took his own care while being besides her friend and helping the authorities investigate and ensure justice.

I feel that there are three fronts on which we need to work to at least begin eradicating this evil act our off our society. Of course modifying our laws to ensure a strict and swift verdict for the accused is an important milestone but more importantly I think there is a huge obstacle in what transpires between the incident itself and the lodging and investigation of the complaint. In this particular case the victims cried for help from the roadside and no one was ready to help until the police arrived about half an hour later. Personally, it's hard to blame the passerby. Imagine yourself walking, riding or driving on a road stretch and finding a profusely bleeding naked person on the side crying for help in the darkness of the night! How likely would you be to stop and take them to the hospital? It's tough! Even after the police came, the victims were suffering in the biting cold pleading for clothes, the officers were concerned about the jurisdiction under which the case should fall. I strongly think that it's more important for the law to change to focus on advocating immediate and unconditional help to those in need. To support the "Right to Live" above all else and to avoid trapping the helper in such legal intricacies that they hesitate to make somebody's fatal problem as their own. At the time when her body was bleeding and her internal organs were dislocated, had she been administered medical help without any bureaucracy the results might have been different. But it is the fear of getting caught in the legal web as a witness trying to help a crime victim that withholds the common man from stepping forward and helping someone in dire need.

Another obstacle that would come in the way of reporting such crimes is the mentality of our society. How can we progress to uproot this crime when our spiritual and political leaders blame the victim and the lifestyle of those protesting. Even though they are individuals presenting their viewpoint, the fact that they represent thousands of people who follow their ideology reflects the mentality of a big section of our society. Chetan Bhagat writes very well about working towards an inclusive growth to address this vast disparity. Globalization is impacting some regions more rapidly than others and there is still a large section in India that forbids a boy and girl to roam together in their youth. Quite understandably so, a case in such a society would be suppressed to avoid the "stigma" associated with the victim. But even the typical middle class parents would be concerned of their standing in the community if, God forbid, such an incident about their daughter is revealed in public. As we progress and integrate ourselves with the rest of the world it is the duty of our leaders to oversee the cultural transition that is bound to increase the interaction of women with the society and grant them the freedom that was earlier repressed. Our legal and judicial systems need to respect and support such transitions and not point at the resulting lifestyle as the reason for such mishaps. This is a BIG change and apart from needing a strong law to avoid harassment due to lifestyle I think it needs cooperation within the educated section to talk about such incidents rather than shun them.

But, most importantly, I think we need to get into the root of the atrocious crime. We can have all the laws we want but no person, in their rightest of minds, will be able to, even remotely, justify the brutal act. It's inhuman. So why would somebody engage in it? I think the reason when a gang is involved is different from one when just a person is accused. In the case of one person statistics reveal that many a times it's someone close. But in the case of a gang it would be worthy to assess their history. In this particular case all six accused hailed from a slum, were illiterate and used to drink, abuse and create a chaos in their slums. In their intoxicated state they had lost their reasoning to such an extent that satisfying their innate desires was more important than anything in the world. ANYTHING. They were, probably, not in a position to comprehend the consequences of this act. And they are not alone. In this case I think education and employment might have helped bring stability and the discipline to avoid them from entering a state in which they are blinded of the repercussions of their own actions.
But is it possible for someone to be aware of the consequences and still indulge in this act? Yes, when they think they are beyond the reach of the legal system. There have been cases where the rich and powerful have exploited their position either with a direct intention or to uphold their ego when challenged. With the rampant corruption and the power exercised by the higher echelons of the society many such cases are subdued by hook or crook and the few that emerge create a large outcry. Easily said than done, of late there have been many movements against corruption in India and a lot of emphasis is laid on a completely independent and speedy judicial system. Though we have a long way to go I think that painting a sharper picture of the consequences and ensuring proper execution might help in curtailing even the thought that could lead to such an inhuman act.

May God give courage to her family and others like her's. I hope we just don't get resilient but pay her a tribute with some concrete actions.

How much money do you need?

2013-01-05T10:24:00.000-08:00

Very recently the United States government averted the Fiscal Cliff, allegedly the biggest catastrophe that would have drawn its economy back into a recession. Now, you may ask, how would that have happened?It's simple - Bush, during his tenure, had passed on a bill for a tax reduction that was going to expire on 31st Dec 2012 after which the taxes would have gone up. In parallel, the government had raised the debt ceiling in July 2011 that came with a clause to implement a series of discretionary spending cuts beginning 2013 if the Congress is unable to bring down the deficit, which it couldn't. When these two forces combine together it would have caused an increase in the tax rates and at the same time would have lowered government spending that would have threatened to stall economic growth even before it could begin.

In simple terms, the government needs money to function and implement it's policies. That capital comes from income which are largely composed of tax revenue. With the financial crisis and the multiple wars that the Congress had to battle its reserves have been drying up faster than they could have been replenished that led US to borrow consistently. The tax cuts have further reduced its income stream while the unaltered spending has kept its appetite at its peak. Now the debt ceiling is a self proclaimed limit imposed by the Congress on the amount they can borrow which can only be changed by a majority ruling. Although politically complex, economically if US borrows over it's ceiling then it is considered a technical default that can results in a chaos about which I'll talk in a while. To avoid the ensuing chaos and for the government to be able to carry out its activities the debt ceiling was raised in July 2011. Just as it was raised US was deemed a slightly incredible entity to lend money to by one of the rating agencies which is not really surprising since the move is just an artificial measure to increase its borrowing capacity. But what is also surprising is that there was demand for such debt because in the middle of the Euro Crisis it was still considered a safe haven and US sold about $240bn of debt in one day, the largest such sale ever. This also helped keen the interest rates to a very low level.

During 2012 US managed to stay under the modified debt ceiling even after the QE rounds by Fed and the interest rates remained extremely low. The intent was to stimulate the economy and bring it on the path of growth and as we see it did manage to provide the markets with one of the best years that they had seen. But the future of such growth now remains uncertain as with the mismanaged deficit US seems to be drawing close to a debt crisis that could threaten the financial powerhouse of the world.

As for the tax cuts, Bush had enacted the law in 2003 when no crisis was looming and then Obama had a choice of either extending them or letting them expire in Dec 2010. After careful deliberation and analysis it was computed that an increase in rates would lead to an annual increase of about $3000 in middle class income taxes. At the time when the middle class was already grappling with the after effects of the crisis it would certainly have been a challenge, more political than economic, to thrust the public with a larger tax bill. And now, two years later, the same situation looked at the Congress in the face again and this time with an added sword of fiscal deficit hanging on its neck.

As the tax increases are coupled with a fiscal deficit, this time the Congress heeded to Obama's proposal of letting the taxes stay low for the middle class while allowing the tax increase to go into affect for the rich. It indeed seems to help bring in much needed income over the next couple of years while still not taking away any disposable income from the middle class. But the Congress did not get to any agreement on the debt ceiling and it only has two months before it can take a decision on its limit. Now it can be debated whether the increase in taxes would serve the purpose it is meant to as some studies show that the rich were more inclined to pay taxes when the rates were lower than when they are up. But the markets still haven't digested the brunt of the news and are aware of the looming danger of the debt in the coming months. This has led to a drop in the prices of US bonds as investors express their fear in US debt.

I think that this can have an enormous impact on the economy. US debt has been blatantly increasing since the turn of the previous decade without any focus on increasing the revenue. A weak economy led it to ease the burden on the troubled households by lowering the taxes which it was forced to increase a few days ago. The effects of such actions are not felt in a day or two but they pile up only to explode at some stage. How can the country which cannot pay its obligations assure me of my bank's obligations towards me in the form of deposits? Bank deposits are insured by FDIC and so it might lead to a bank run which would further threaten the entire financial system.

The US debt has been enjoying a stable position with high prices and high demands, especially because of $ being the reserve currency but it seems like that notion is in its reversal. I think that in the next couple of years US treasuries will drop in value and with economic growth yet to come the true value will only be seen in real assets. Gold and other commodities and growth in developing nations would probably be the next target on investors' radar. I think US has started to realize that it needs to tighten it's reign and we should see some contraction in its spending in the coming few months. It's hard to balance that with an ailing economy but it's even hard to lose the faith and trust of being a financial powerhouse.

It is debatable as to what would happen. It's not easy to lose faith in US. As China works to keep US bonds in its reserves and investors around the world don't find a safe asset to invest in, US would continue to enjoy the position of being a safe haven.

[Update]
An interesting read: http://www.bloomberg.com/news/2013-01-02/ten-things-you-should-know-about-the-cliff-deal-so-far-.html

Statistical Arbitrage!

2012-12-28T19:17:00.002-08:00

With my experience in statistical analysis and after further gaining information on equity markets I was curious to explore the possibility of generating alpha by combining the two skills. I got an opportunity where I worked on a similar idea and then I extended it on the data I had downloaded from yahoo.
In this strategy I try to find a statistical equivalent of pairs trading and try to extract inefficiencies in price movements.

Abstract

The objective of this analysis is to obtain an alpha that is based on statistically exploring ineffi ciencies in stock prices. The strategy involves decomposing stock prices in each industry into principal components that explain the most variance and then regress the stock prices on those components to obtain the stock's dependence on them. Next the components are forecasted using GARCH model and hence the forecasted evolution of the stocks is also obtained based on the regression results. Based on these forecasts I will create a long-short neutral arbitrage strategy with the aim of achieving high risk adjusted returns.

Statistical Arbitrage on US Equity
https://github.com/kunalrajani/statistical-arbitrage

Disclaimer: Please read
Please note that this is my independent work where I have used data from yahoo finance to explore statistical concepts from a course I took in statistics. It may inadvertently have an overlap with a work that somebody else has already done and I have no intentions of replicating it. I would be glad to know of any such clash and post a clarification on this post.
I am open to having my work being redistributed or used but only after due credit and a reference has been made. Feel free to contact me to avoid any misunderstandings or if you need more details from this paper.

*The analysis is still underway and the conclusions are under review

President's TheBait

2012-11-03T15:52:00.002-07:00

It was the first time that I saw the incumbent and an aspirer to the most powerful position in the world battling out each other in a 'people's court' to gain confidence and hence the vote to be the next President of the United States. Being from a nation with multi-party politics this seems somewhat infeasible in India but there are many other reasons that I think hinder such an event. There is a lot that can be said about these debates, their pros and cons, modifications that can lend more credibility to their outcomes, their inheritance to other democracies, etc. and I will try to touch briefly on each of them.

I think that there are many shortcomings that such a debate faces that go unnoticed in the sequence of events. The biggest drawback I think of this format is the inability to verify the facts. I remember very vividly how Obama kept on insisting about the $7 Trillion increase in deficit that Romney's policies would lead to while Romney consistently kept on denying any such proposal from his end. Had there been a team on both the sides well equipped to verify and crunch out the details of any statement it would have been an expedient revelation of the accuracy of the debate. I'm not questioning the feasibility of such a setup but lack of such checks allows the candidates to revolve around the truth with their confidence lending credibility to their statements. The common man who doesn't have the resources or the capability to analyze the debate and connect it with the facts from the campaign is liable to fall prey to such falacies and create an incorrect opinion based on them. For eg. it seems a no brainer to vote to have your taxes cut, but, that leading to more jobs and hence, on the contrary, an overall increase in tax revenue is a hypothetical assumption and one that is prone to the dynamics of the economy. Of course Obama must have computed the impact of such a move based on which he came up with the $2 Trillion figure but, at the moment of Romney's repudiation, had there been a team that could have presented their findings and hence challenged Romney, it would have once and for all exposed the impact of his policies. These statements can lead to an incorrect assessment of the manifesto of the candidates especially by those who don't go deeper into their analysis. In another case during the debate on foreign policies when Romney brought up the controversy over the Benghazi attack and how inefficient the white house was in investigating the situation and make statements his entire accusation was responded by a confident "Get the transcripts governor." And it is this confidence that can mislead a big electorate who care about such issues to align with Obama and trust him with their vote.

We know that its all politics and the truth, even if told, will be presented in a manner that would benefit the speaker. An excellent example of this was when Romney accused Obama of visiting the middle east region and leaving out Israel that he considers as the most important American Ally in the area. This was dramatically turned around by Obama who stressed that the importance of such tours was not centered around publicity and election campaigns but more so to be on the ground and learn from the hardships that people face. He highlighted that he had indeed visited Israel earlier during the Lebanon War and had offered his condolence and help to the families affected by the war. In another situation where Romney pointed to the inability of Obama administration to contain the rise in oil prices and vowed to bring them down to 'pre-Obama' levels, Obama struck back cleverly pointing to the low prices being reflective of the failed Republican policies that brought the entire economy to a halt. It seemed Obama learnt really well from the first debate on how to turn around the reason for a shortfall in any economic indicator to his predecessor.

Both the parties have the goodwill of the Americans in their heart and, striking out misuse of power by corruption for personal gains, both the leaders would aim to uplift the standards of the Americans if elected. (The striking out of corruption is a very critical factor that separates the politics in developing countries like India where numerous scams result from exploitation of power and personal motives play a big role in candidates vying to be elected.) In that scenario it is difficult to imagine any disparities in their policies and its the inability to identify that that can lead an average Joe swing in one direction or the other simply by the confidence and the gut factor. But inspite of these shortcomings I think that these debates provide a crucial platform to witness the vision and its depth that the candidates have for the future. Especially interesting are the issues where both the candidates take strikingly opposite views and then debate to defend their stances. Two key issues to report in this aspect are the taxes and medicare. When you truly have opposing views it makes it easier to get closer to the vision of the candidate and question their thinking. In the case of taxes it makes it easy to distinguish that Romney wishes to lower tax rates while Obama doesn't show any actionable inclination in that regard. For medicare Romney proposes the insurance to be in the hands of the private players without any hindrance from the state and relies on competition as the platform to provide different products while Obama proposes a government enforced program to ensure that everybody has insurance. These two facets seem to point to deregulation and capitalism as being reflective of a Republican and to the liberal and progressive nature of a Democrat and even though both the parties have the best intentions at heart their radically different means can lead to quite different outcomes.

For the well informed and educated these debates provide a good insight into the minds of the leaders themselves among whom one would be voted. It is this insight of a concise agenda of the parties and the knowledge about the leadership that I think is missing in Indian politics. Hence the political parties are able to take advantage of the unaware masses who cannot think and analyze, beyond their short term needs, about the economy, jobs, growth and income. They are contented with the promises of factories that would provide them employment, irrigation measures for their farms, development of roads, hospitals, etc. Although that these are essential measures to promote growth and well being of citizens it would be helpful if they promote their manifestos and highlight their vision than the next project. Agreed that with such a huge electorate, a diverse set of cultures, different geographies and varied needs, add on top the multi-lingual regions, it makes it extremely difficult for a common debate to make sense for a majority of those watching. I think before talking about the debate political parties also needs to put a face to their campaign than install puppets managed by family run politics. A strong leader needs to be able to instill confidence into the people about his ability to take the country forward and be available to answer to people. Once the parties have a leader who is also a contender for the Prime post I think it is possible to have them present their views on the key problems being faced by the country which can probably be dubbed or have subtitles and be telecasted across the nation.

Without such leaders and their visions it would be hard to uproot dirty politics out of government and any discussions or debates would act as the baits to attract the people based on their immediate needs.

Understanding Factor models and Cone programming

2012-09-25T07:13:00.001-07:00

This was a very interesting project we undertook. Not because its result was any enormous value addition but because it helped in grasping concepts and procedures critical to function in practice. It helped in going through the rigorous process of data cleaning and implementing factor models and checking their significance to predict stock returns. Further on we explored optimization using cone programming, which is a special case of interior point methods, to maximize the sharpe ratio and obtain a market beating portfolio.

Here is the Abstract:

The goal of our project is to utilize factor models to explain returns and optimize the Sharpe ratio to create a portfolio that outperforms the S&P 500. After re fining our data we have a universe of 335 stock in which we can invest. We re-balance our portfolio quarterly and incorporate factor models and Sharpe ratio optimization through cone programming to form the portfolio. The rest of the paper is organized as follows: Section 1 is a short introduction of our paper, Section 2 gives a brief idea of the data available and what kind of choices we made to reach the final universe of stocks, Section 3 gives an idea of the general methodology used in the paper, Section 4 describes the results that we have reached, Section 5 presents the significance test we performed, Section 6 presents the results of different sensitivity analysis and Section 7 summarizes the project and gives suggestions for further research.

Investment Allocation using Factor models and Cone programming optimization

Let's get on the street - Part II

2012-09-15T09:42:00.002-07:00

Furthering my experimentation with the real world data, I delved into the minds and psychology of investors. I had taken a course on Behavioral Finance that explains certain irrational phenomena that governs the nature of humans when then invest. This nature has certain shortcomings that are overcome by what has emerged to be known as systematic investing where a computer algorithm makes the decisions rather than a human who can be misguided by emotions.

The following Abstract gives a brief overview of the analysis:

There are many instances when a stock price experiences a sudden jump or a decline and, besides the financial crisis, it has to do with a fundamental change in the business of the stock. Eg. the consumer reaction to netflix's fee structure or a revelation of the revenue reporting mechanism of Groupon or the billions of dollars of trading losses by a bank or the passing of a law that gives huge tax incentives to renewable energy. These events cause almost an immediate reaction by the market reflected by the stock price changes and then as these events are studied in depth and their true impact is understood, the stocks migrate towards their true valuation. The relationship between a surge or a drop and the later migration is something that interacts with human nature and, if understood well, can be leveraged to generate investment idea. In this paper I shall explore such drastic movements and try to understand what their impact is on the stock prices. This is more complicated than it seems because of a change in investors' perceptions after the financial crisis and because of different nature of information dissemination for firms in different segments.

Investing on Behavioral bias

Disclaimer: Please read
Please note that this is my independent work where I have used data from yahoo finance to explore time series concepts from a course I took in statistics. It may inadvertently have an overlap with a work that somebody else has already done and I have no intentions of replicating it. I would be glad to know of any such clash and post a clarification on this post.
I am open to having my work being redistributed or used but only after due credit and a reference has been made. Feel free to contact me to avoid any misunderstandings or if you need more details from this paper.

*The analysis is still underway and the conclusions are under review

Let's get on the street - Part I

2012-09-15T09:30:00.000-07:00

Now that I'm in my third semester of my program I've started to apply a few concepts that I learnt in my earlier courses to see if they actually make sense in the real world. It's hard to digest the fact that even doing an "a+b" in the real world is not that easy - acquiring data, ensuring that it is exactly what you want, cleaning it, checking if it makes sense and clipping out those that don't and still be left with enough meaningful numbers involve a series of massive challenges that only a practitioner would comprehend. And that is exactly why I ventured on this endeavor, to map classroom coaching to real world implementation.

I would have actually wanted to branch off from this blog since it has mostly been about life at Cornell but for now I think I would include all my analysis here until I figure out the best way to split the two different topics. In this post I attempt to implement ARMA time series model on large cap stock returns in an attempt to predict their future returns. It's a first attempt but nevertheless gives an excellent idea about the issues I described above and if the time series concepts work by a brute force methodology.

ARMA model for large cap stocks returns

Disclaimer: Please read
Please note that this is my independent work where I have used data from yahoo finance to explore time series concepts from a course I took in statistics. It may inadvertently have an overlap with a work that somebody else has already done and I have no intentions of replicating it. I would be glad to know of any such clash and post a clarification on this post.
I am open to having my work being redistributed or used but only after due credit and a reference has been made. Feel free to contact me to avoid any misunderstandings or if you need more details from this paper.

Welcome NYC

2012-08-31T23:03:00.000-07:00

So after a remarkably memorable stay in the small town of Ithaca it was time to leave the confines of the walls that Mr. Ezra had originally intended all of us to stay in. The idea was that away from all the city congestion and distractions students will get a chance to mingle among themselves in an academic setting that would help foster an enriching learning environment. I guess he did not conceive of this stream of Financial Engineering that inevitably brought Cornell closer to NYC until 2007 when a small part actually branched off and landed on wall street.
Now I wasn't going to begin studying anytime soon and if fate had it's way I might not have even been here so early but here I was, for my internship. I have been a city boy all my life. I grew up in Delhi, India, studied in Mumbai and lived in Bangalore. All these megacenters are one of the most populous cities in India and with an ever increasing immigration population and the progressing boundaries the population density doesn't seem to stabilize.They are home to people either scrambling to get onto that bus to reach their workplace, to catch that last spot on the train trying to make an errand or just to people that exist trying to make your life more complex! But in return, to serve the entire array of different classes of people from different backgrounds and tastes, you get a host of amenities that sometimes seem customized to your need. Be it a restaurant that serves your favorite entre, a pub that plays just your music, a coffee shop that blends to your taste or even a tailor that stitches to your body.
BUT... all this comes when are in a state to really enjoy what they have to offer. And you certainly cannot be in that state of mind when you are in no man's land and trying to find a place to crash for the night. Home. I have looked for a place twice back home and once here in Ithaca, NY. In each instance I took the time (I would now say I had the luxury of time) to look at a few apartments, weigh them based on different criteria and then decide on the one that passes all the screening. Now this process typically took me a week or two and I was fortunate enough to have my cousin living in the heart of the city where I could crash for that time while I looked at other listings. So I log onto craigslist and try to rank the listings based on the location, distance, furnishings, utilities and my understanding of the safety and fun of the neighborhood. My office was at Grand Central and my next term was to be in downtown. To avoid being sucked into Manhattan's expenses and at the same time have a clean, fun and safe neighborhood I chose Astoria in Queens. It was the end of May and the search threw numerous results of places being available in a couple of weeks for the summer. Even after filtering for what clearly was spam there seemed to be a good number of listings checking which could keep me occupied for a few days.
So, being the diligent person I am, I jotted a few places and mapped my route and headed off. Now what you hear or see about a place can be quite different from what you witness with your own eyes, or in my case, ear. My first stop was north east of Williamsburg and I was pleasantly surprised to see the train ride on an elevated platform. But that soon turned into a blare as I stepped out and it was further disappointing to know that the listing was right around the corner and the noise of the train would deem an alarm unnecessary. Next I took the 7 back to take the N/Q and go into Astoria. The same problem persisted though the area was quite widespread and open to take away that claustrophobic feeling of elevated tracks and the blaring sound. They were all 2 storey row houses with a shop on the 1st floor and along with the curbside restaurants and clean streets it gave the town a pre-modern European look. It seemed like a giant chopper had chopped off all Manhattan sky scrapers from 3rd floor up but then you could still see the city across the river. It was a love at first sight and I knew I was going to live in that neighborhood.
Unfortunately I was still not familiarized with how "big" the rooms really are when they say that on craigslist. My first destination was at a place where 3 men, each over 40, resided. The room was as big as the size of a store room, the living room finished before it even started and the kitchen cabinets were locked because no one cooked. As if that wasn't enough the guy listed all the rules of the house as minute as cleaning the floor and I never thought about that place after that. This way I rejected a few other houses of the day and the next morning I was really considering taking up the first place I saw. When I called up to check I was surprised to know that it was taken up already. That got me on my foot and I started carrying my cheque book along to be able to sign off a place as soon as I saw it.
I was glad to have the assistance of a smart phone all this while. I could always check craigslist for any new sublets and I had that page with my search filter always open. I spent the next week looking over each sublet listing and each time something prevented me from committing to it at that very instant. One was perfect but was available only for 2 months. Another was well furnished but was too far from the closest subway. Then another was also very well furnished but it turned out to be a home to a 50 yr old and his dog and I used to curse them for not being clear about such descriptions on craigslist. The ones that had a good location were either too small or were in a dingy apt or were unfurnished. After about a week I became quite stressed of the situation and restless of living out of a suitcase. I expanded my search to downtown and brooklyn as well thinking that it would be better in the long run when my term begins in the fall on wall street. With the constraint on my budget I could only find apts in Chinatown that appeared like sleazy makeshift dorms that could break away any time or others in brooklyn with so much mess that my trash can seemed cleaner.
Finally I struck gold one day with an apt in Jackson Heights that was well connected by an express train, was in a nice neighborhood and had a big and well furnished room and that too for just $600. I immediately contacted the person and was there in 30 mins - a good test to measure the daily commute time I was going to have. I had been tired the past few weeks and being the middle of June the listings were thinning out and I was really hoping for this to work out. When I reached it turned out that the guy was living with his mother and they had had an Indian tenant before so we struck very well and we all had a good conversation for over an hour. We both liked each other and they began typing the sublet contract and I took out my cheque book. I had been warned to verify the credentials before entering any transaction and so I asked to check their papers and showed them my id, etc. Somehow that sort of upset the lady and she started having second thoughts. Now, I wasn't too impressed with the rest of the apt or its distance as well but I really liked the room and already under pressure I wanted to sign it off. So I tried to work it out well enough and left assured that the guy will be able to convince her mom.
Hardly did I know that it was a blessing in disguise for the next day, while I was holding on to them and still trying to find a better place, I struck gold again and this time I really felt that it was the one! Within 40 minutes of the ad I was in the apartment to check it out. Hardwood floors, big enough and furnished with bed, sofa, tv, desk, chair and AC, two large windows, well stocked kitchen and an orderly living room with a 52" screen and psII. I was all over and when I actually handed an advance cheque and got the receipt I could feel a heavy weight suddenly off my head.
I moved in about a week later and I would say that I love the neighborhood and this house was definitely worth the wait.

PS: A word of advice - when looking for apts in NYC be ready to commit on the spot, especially when its a sublet. The market is very rapid and dynamic and it pays to be a bit flexible and strike a place as it comes.

Good Bye Ithaca

2012-06-16T00:36:00.001-07:00

And so it was, the end of an era. Though too short to call it so, it was packed with enough substance to qualify as one. The thrill of the ending of examinations transforming into a deep sinking sickness over a period of few days had a tumultuous ride. The weekend after was quite relaxing although my mind was occupied with devising the exit plan, exit from Ithaca. But before I did that, the next few days were going to be really amazing, sort of a flash back of the last 9 months coz my family was going to pay me a visit.

I picked them up from Buffalo and before our departure we made an impromptu visit to the Niagra Falls. I had been to the falls last during my internship in Toronto and so it was from the Canadian side and it was with those memories that I was looking forward to the visit. I remember the liveliness that engulfed the region defined by curb-side restaurants, kids' attractions, junk and souvenir shops, ice creams, sweet balls, hot dogs and children running in the huge gardens amidst families picnicking and people walking their pets. All this was nowhere to be seen on the US side that consisted of just a small mall that showcased a disappointing collection of cuisines and a sort of dull garden. Nevertheless as the area opened into the falls the whole mood switched.
I had rode on the Maid of the Mist last when I was 12 and though I couldn't conjure it as something exciting it indeed was a pleasant experience to go right till the foot of the falls and witness the enormous rage.
We had got a bit late on our way back and I must say that driving in the countryside at night had its own share of fun and fear. Notable was the moment when I turned off ALL the lights in and out of the car that felt as if we were tearing through darkness in the middle of nowhere!

When back to Ithaca I gave a "crash course" to my family in 3 days of what I knew about the town in 9 months. We first went to Cayuga lake and although I had thought of buying food there it struck me to pick up something from the Hot Truck that we passed while taking a tour of the North Campus. It skipped my mind that Cornell ran Ithaca and with the end of the semester it wasn't just Cornell that took a break but many businesses cut down their hours, including the places by the lake. Thankfully we had food and we got a nice place and I cannot describe the eternal peace of mind I felt while eating besides the placid lake and nice bollywood tracks playing from the phone. We then went for a walk at the Taughannock falls and then on the way back stopped at a vineyard a number of which span the surroundings of Ithaca.
The next day was fixed for a tour of the University, by foot! I had given a glimpse of what the daily walk towards the campus looked like and it was time to experience it first hand. A lunch buffet at Mehak was hence tactically planned right after the first leg of slope. I should take a brief moment to point the transition lately from Sangam to Mehak as we rediscovered the delicacies it offered at the same price. Maybe we appreciated the change or maybe Mehak did bring about an improved change in its cuisine but we had been frequenting Mehak about weekly during the last month and never got tired of any monotonicity. After relishing the sumptuous meal we scurried off to make it through the time window for which the clock tower is open, to get a splendid view of the entire town. Then we went in a few buildings where my parents appreciated the disparity between the modern facilities that a top Indian university provides and here. The concept of "break out" rooms for student groups to study took them by surprise as even I remember that IIT didn't come equipped with any such provisions. After enacting a few lectures and trapping those moments on film we went back home to dress up for a dinner at one of those curb-seating restaurants in downtown. Honestly it was the second time I went for fine dining at a curbside place in Ithaca and it was really refreshing. After fully loading ourselves we strolled around the Commons and then went back home.

The next day was relaxing and consisted of packing all the stuff and I must say that it was really hard to assimilate all the items that I had piled over the course of two semesters and organize them to be able to discard most of it. More than the physical effort, each item brought with it a different memory and it was tough to throw it away and erase its existence. It felt like the whole life that I had built throughout this time was falling apart and it was unsettling to think of all that I wanted to but couldn't accomplish in this "golden period". I had met some amazing people during this time and although we would stay in touch there was an uneasy feeling of the connections breaking away and our lives transforming to the next phase. I still had one more semester to go but as I imagined and realized it would be a whole new story and no where the same. Nevertheless what had to be done had to be and I am glad I had my family to sail with during this time. As I packed all the belongings and stripped my room to its original state my first week here flashed before me and all the fun/hard/pleasant/anxious/excited/drunk/hot/cold/loud/crowded and amazing times crossed my mind. All good things do come to an end! Next stop - NYC.

Slope Day

2012-05-05T12:07:00.001-07:00

Throngs of college students spread over the entire libe slope shaking to the tunes of three different genres unleashed via an array of JBL speakers and woofers creating a thumping atmosphere - that was just one aspect of the Slope Day 2012.
An annual spectacular to mark the last day of classes, slope day is the traditional event when students from all departments and batches unite for a single common cause - letting it loose! It is amazing how the managers were able to pull out the event given the fact that we had a hailstorm just the previous night that stripped the town off power for an hour. The prevalent rains and stormy weather would have dampened the spirits of many while the coordinators were at work erecting the fences through the night, their optimism providing the courage. And it seems, fortunately, the weather Gods gave way to the hopes of thousands by setting up a beautiful backdrop with the perfect weather - a cloudy sky with light sun!
I arrived for the event pretty early right after my lab (yes I had a lab!) at noon. We entered from Ho Plaza and the liveliness in the atmosphere set the tunes for an exhilarating evening ahead. There were food stalls offering cup cakes, sweet donuts, drinks for light refreshments and then down the slope were more food stalls for proper meals. But of course the crowd had piled up into a single line that led to the alcohol section. And I must say how well the entire crowd was managed.
Having come from the institute that hosts Asia's largest cultural festival the meticulous planning that was apparent in the Slope day was praiseworthy. There were numerous volunteers spread across the entire arena with backpacks filled with water bottles handing them generously to anybody who could use a sip. Then there were others carrying plastic bags and wearing tags indicating what would go in those bags - compost, trash, recyclable, plastic, etc. Also on site was Ithaca police well equipped with the gear to tackle any situation. And this was very well tested when a minor scuffle broke up between two students when they had to interfere and there radios came in handy to call for additional help. There was another section for first-aid with doctors and ambulance ready in case of any emergency. Apart from the readiness in terms of man power the entire process that required regulation like adherence to queues, purchase of food and alcohol tickets was done in an orderly and fool proof manner such that it could not be replicated or abused. Quite impressive!

The highlight of the evening were the concerts - The Wailers, Neon Trees and Taio Cruz. I went right upto the stage for the last two and I could tell that it had been a long time since my ear drums had vibrated with such a high amplitude! A few minutes into the crowd it was impossible to hear anybody around except for the unanimous clamor that followed the song. As cliche as it might sound - I was completely immersed in the sound waves and was flowing with the beats. Has it been long since I went to a concert! To add to the excitement and the frenzy the volunteers had been sprinkling water at the crowd and the crowd supplemented by sprinkling from their own bottles. With that, the mud from the ground began taking friction away and there is where I guess it got it's name from - Slip, I mean Slope, Day! To give the perfect ending to the day was "Dynamite" from Taio Cruz and I got goosebumps witnessing the exuberance in the air.

All in all the pleasant weather, the charged up atmosphere and the high spirits of thousands of students added up to bring a memorable end to the first year of graduate studies at Cornell.

PS: Photos courtesy Cornell University @ Facebook.

What is the problem with Greece?

2012-04-04T06:54:00.006-07:00

This has been a topic at the helm of global finance that has taken all the markets on a roller coaster ride since the past year. Here I attempt to discuss some of the issues, the causes and the steps taken to avert a crisis as a result of its ballooning debt to GDP.

Why is Greece close to defaulting on its sovereign debt (government bonds)? Why cannot Greece use the monetary policy tools that traditionally states used to ease their debt burden, and what are some of these tools?

Even before the time they entered the EU, Greece has been on a spending spree on infrastructure, services and public sector wages. As Greeks reduced their tax payments, the vast gap between government income and expenditures was filled in by borrowing billions of dollars from other banks and nations. This enormous public deficit was exposed post the 2008 banking crisis and currently, with a 160% debt to GDP ratio, Greece is nowhere near able to pay off its debt. With the downgrade of Greek bonds to junk status no one is also willing to lend Greece and being on primary deficit it is further unable to meet its expenses without external monetary support.

Some of the monetary tools that governments use in such a situation are devaluation of currency, increasing the interest rates, controlling reserve requirements or printing new currency. Greece had been deploying many of these tools before its integration into the Euro. However, under the Maastricht criteria applicable to all EU members, all the EU states need to keep their inflation rates within stipulated limits and need to have a control over their government deficit and debt. In addition they need to follow the exchange rate mechanism under European Monetary System (EMS) and also need to keep a check on their long term interest rates. Since Greece is a part of the Euro it does not have enough flexibility with these policies to be able to come out of its debt crisis.

http://www.telegraph.co.uk/finance/financialcrisis/9098559/Whats-the-Greek-debt-crisis-all-about.html

http://en.wikipedia.org/wiki/Maastricht_Treaty

The Greek economy is small relative to the economy of other states in the EU – why would a Greek default significantly impact (i) the economy of other EU states; (ii) the stability of the Eurozone; (iii) the world economy?

Even though Greece has a relatively small economy, a Greek default can lead to a contagion the effect of which will be felt throughout the EU and also the world at large. It would send the yields on Portuguese, Irish and Italian bonds spiraling upwards and Portugal might have an incentive of defaulting as well. Subsequently the confidence in these countries will drop leading to a bank run and a severe credit crunch and EU will need to provide capital to the banking system for which there would be no collateral.

Such events would lead investors, and the world, to lose confidence in EU and hence growth can be hampered in the near future which can also lead to a drop in the euro. With the global financial system just out of a financial crisis, this contagion will be akin to rubbing salt on the wound that hasn’t even begun to heal yet and it would probably put Europe in a recession and would stall short term growth throughout the world.

Great efforts are expended to restructure the Greek debt so that it does not trigger CDSs written on Greek bonds. Who holds these CDSs?

The net value of CDS written on Greek debt is small as compared to the total debt. For instance, with a $300 billion of restructuring and $100 billion of wipeout, the outstanding CDS contracts net just about $3.2 billion ($70 billion overall).

These CDS are held by private entities that have invested in Greek debt over the years. Although this information is not publicly available, it is known that major European banks such as DB and BNP Paribas as well as some American banks such as JP Morgan, Citibank and Goldman Sachs hold Greek debt and have hedged it with CDS.

Recognizing that the situation evolves from day to day, what are the arrangements related to the Greek debt restructuring that are contemplated currently?

Of course Greece defaulted for non payment of the dues it owed on 20th March. Thankfully, to my utter surprise, it failed to shake the markets in a way I had imagined leaving it with just a nudge, maybe that was also the market's volatility itself. However, to ensure that financial markets are now immune to the fate of Greece a series of hard steps were taken and accepted, in some cases against the will of many. Here I lay down those steps and their magnitude.

There have already been four rounds of austerity packages involving about 100bn Euros in loan and a round of austerity measures being implemented by the government. Currently the Greece creditors have agreed to a 53% haircut on the Greece debt and EU has raised about $172 billion for support the remaining debt of Greece. Debt swap for coupon bonds (50% of face value as compared to original) have been initiated with a coupon of 3.7% bringing the total voluntary write-down to around 70%. Although it seems that even this huge bailout will not be enough and ECB reckons that Greece would need another 254bn Euro to meet its targets.

Under the terms of this bailout Greece is required to undergo reforms aimed at reducing its debt to 120% of GDP by 2020 from 170% currently. These include severe austerity measures as well as a 22% wage cut across the working population and a 35% for those under 25.

But this bailout has quite some risk associated to it especially because of the elections that are about to take place in Greece in April. The debt restructuring package is extremely demanding on the citizens and it is not surprise that there have been widespread demonstrations, sometimes violent, against it. This can be a crucial campaign agenda for politicians who can promise a renegotiation of the terms which casts uncertainty over Greek default. On the other hand the deal has been struck with the private sector representative, the IIF and needs the support of each of the private debt holder to go through which is a major process in itself. Now this debt restructuring has been accepted by a higher majority of the private creditors as against the alternative of losing their entire investment and face the ugly process of recovery from a default.

http://blogs.wsj.com/marketbeat/2012/02/07/whats-the-latest-on-greece/?KEYWORDS=greece+default

http://online.wsj.com/video/is-europe-preparing-for-a-greek-default/7ACA93BF-474E-4DCF-A9DE-248567E1E152.html

http://online.wsj.com/video/where-next-for-greece/DE35FF36-8253-4E67-90B8-637E849D7F7F.html

http://dealbook.nytimes.com/2012/02/21/greek-crisis-raises-new-fears-over-credit-default-swaps/

http://news.goldseek.com/UnionSecurities/1328198400.php

Vacation in Puri

2012-03-16T21:37:00.009-07:00

It has been a long time since I have written and, to some extent, the demand of my coursework is to blame :). I won’t complain because this term has been quite interesting from the practical perspective and I always found myself immersed in some course text rather than penning down my thoughts. But my account of the winter break has long been pending and I would want to put in words what’s left in my memory.

During the winter break of Dec 2011 – Jan 2012 I took a month long trip back home and I must say that it has been the most engaging and diverse vacations I’ve had. I obviously stayed in Delhi and then had some fun in Bangalore after which I went with my family to Bhubaneshwar, Orissa and then to Puri, a beach in Orissa. Puri is quite a popular religious destination that hosts the yearly padh yatra, a ritual in which priests travel a long stretch of road bare foot with lord’d idols to seek divine blessings. But apart

from being one of the four most sacred pilgrimage sites in India it is very strategically located so that both the sunrise and the sunset are visible from the beach – and was that amazing! Puri is a small city and as you travel along the beach the swarm of people, with all of them engaged in their own activities would instantly overwhelm you. In the clamorous hustle and bustle you’d find young children trying to sell you everything from t-shirts, shorts, sea shell accessories to road-side food which, for sea food lovers, is hard to look away from.

As we went further the density of the crowd diminished and so did the shops that sold such merchandise. Now we could only see small shacks along the beach selling God idols and others providing fried shrimps, fish, crabs, etc. with which passerbys gorged themselves during their evening walks. Our first reaction of living in a guest house amidst such noise quickly dispelled as we entered an area where all we could here was the sound of the waves lashing against the shore. As we arrived in our guest house, we were simply stunned by its interior design and here is when a picture is worth a 1000 words.

The location, the ambience, the weather, the stay arrangements and the mindset – all the attributes that can make or break a vacation were perfectly aligned. The personal touch of the staff was unmatched and it really felt like being at home, imagine when home is as grandiose. The structure was designed with an open heart. It had glass doors and huge windows that opened out to a big and well maintained lawn which further overlooked the beach. Sitting right outside on the couch in the morning, sipping an amazing ginger masala tea, staring at the infinite horizon with cool breeze striking the face and some nice songs playing in the background – nothing can take away the stress better. It was the start of a perfect leisure vacation. The rooms also contained the same style with wooden floors and off white walls and again with large glass doors and windows with an attached balcony that opened out to the sea. The tranquility of the nights was further enhanced in such a setting. After a sumptuously prepared meal spanning daal, rice, aloo gobi and an amazing masala prawns and fish curry, we used to sit outside and chat over tea. It was an extremely relaxing environment and unarguably the best way to take a moment away from the fast paced lives that we all live and blend with the breeze that took all thoughts away.

I could go on about the calmness of those moments and it was ironic how it was right in front of the fiery of the sea, which is also something we enjoyed immensely. Puri is known for its beaches, especially the beach art where hand craftsmen gather from the surrounding places and model the sand into different 3D structures. We were fortunate to be in Puri at a time when the festival was going on and we could get a glimpse of some pretty skilled art work. At the beach the waves were not too quiet and were rough enough to have a wild time. It was the first time that I went into the waters as much as I did, way ahead of the point where the waves start breaking. At this depth it felt like being in an infinite wave pool, only much stronger. There were two ways in which we could play with the waves – either jump with them or stay rigid and face their full force. Both had their own kind of fun but what I particularly liked about smashing a wave was it created sort of a halo if you stood with your back towards a strong one. Another “game” was to jump and let the wave strike your legs. The sheer force would topple you and it would be a challenge to stand back before another one arrives.

It may sound routine and just like another day on a beach but I would say that I have been to many beaches but Puri was a complete package. I would certainly recommend this place to anyone looking for some time to relax but do look for a place away from the cacophony of the central part.

How CDS pulled AIG down

2012-03-04T22:07:00.008-08:00

I have been wanting to talk about things relevant to my course but have just not been able to find any time to devote to writing. On the other hand, I have studied, researched and learnt quite a bit about the mechanics of financial instruments and I would like to share two such topics.
Note that I obtained the facts mentioned in the following lines from different credible sources and all I that have done is paraphrased the content and broken it into categories. I guess the jargon will be too much for some of you so shoot any questions that you have.

The following post is about investigating the reasons behind AIG's fallout:

Why did CDS contracts almost provoke the bankruptcy of AIG?

AIG had been a successful insurance provider until, seemingly, it started to venture out in the business of writing Credit Default Swaps. It began insuring debt obligations of lenders against a risk of counterparty default, thereby taking the credit risk of the counterparty on itself. At one stage, of the $60 trillion CDS market, AIG owned about $440 billion of notional, an enormous amount compared to its peak market value of about $240 billion, with the portfolio contributing over a quarter of AIG’s profits.

The problem was that CDS was designed in such a way that it didn’t require any capital requirements and hence it attracted pension funds, insurers, hedge funds and banks for they could reap on the credit risk without any capital to lend. Furthermore, the demand for such instruments rose as they added on to the profits on the income statements without a mention of the risk involved.

Most of these CDS were on asset backed securities pools, primarily mortgages, and when the housing market collapsed these mortgages that AIG had “indirectly” insured started falling in value. The losses began accruing in 2006 and by 2008 AIG had less equity than it needed to fulfill its obligations. This trapped it into a vicious cycle as its credit rating was downgraded and hence it was required to post an additional margin that further put strain on its financial resources.

Hence we see that AIG, due to its good credit rating and the nature of CDS, was able to stack up large quantities of such insurance on its books with being questioned about the risk involved. Since the notional value of these contracts exceeded the market value of AIG, the possibility of the underlying assets going sour raised a possibility of bankruptcy for AIG.

http://www.economist.com/node/12274070

http://www.economist.com/node/12552204

What saved AIG from bankruptcy?

AIG is one of the biggest insurance companies in US and during the crisis it held a huge amount of credit risk on its books. It started getting calls on that risk when the underlying assets began degrading in value but its capital stash was not enough to meet all the requirements. To avoid a contagion across those who had insured their risks as well as to avoid the mess that AIG’s default would create in its other space such as life insurance and annuities, the government decided to bail it out with taxpayer’s money.

When AIG reported the biggest quarterly loss of any company in American history, of $61.7 billion, the government proposed a bailout package of $85 billion and took a 79.9% stake in the company in return. It further provided up to $37.8 billion in capital and removed the coupon on a $40 billion equity that was injected by the government in Nov 2008. Although AIG quickly used up about $90 billion of the ~$120 billion credit line awarded, it was able to stabilize its margin requirements on its contracts and was able to fulfill its obligations

http://www.economist.com/blogs/freeexchange/2009/03/government_and_aig_together_fo

http://www.economist.com/blogs/freeexchange/2009/04/did_we_need_to_bail_out_aig

http://www.economist.com/node/13213322

What could be done, in terms of reorganizing the CDS market in order to diminish the impact of situations like the one that almost doomed AIG?

There seem to be quite a few fundamental flaws with the way a CDS contract is designed:

With the exception of capital requirements, a CDS contract allowed smaller firms, such as hedge funds, which did not have huge capital to lend, to be able to take on the credit risk of a counterparty’s portfolio in exchange of insurance premium.
The accounting policies did not require such companies to reflect such transactions on their financial statements and hence the risk of such instruments went unnoticed and what appeared on the balance sheets were the profits.
Depending on their credit rating, the companies had to put aside minimal margin, relative to the loan, to cushion against possible defaults.
The CDS contracts allowed speculative positions to be held in the market. Hence the CDS market was over inflated and peaked at about $62 trillion when the value of the underlying debt was just about $5 trillion. This in turn had an effect on the ability of a company to take on debt as its CDS spread in the market would determine its credit strength.
The voting power that comes with a debt stays with the debt holder even when the risk has been passed on. This can result in a clash between the intentions of the lender and the insurer regarding the default of the borrower as the lender might not agree to a debt restructuring.

It seems that with a proper understanding of CDS and its implications its abuse, and hence what followed, could have been avoided.

The regulations around CDS can be more stringent to provide evidence of “credit risk” against which the insurance is sought. This will avoid speculative positions that can overburden the market with possibility of a multiple losses over a single debt.
The accounting regulations also need to be strengthened so that such risks are portrayed on the balance sheet and hence are accounted for in assessing the financial health of a firm.
The firm selling such contracts should be required to reserve certain capital in the event it needs to meet its obligations under the contract. This would help restrict the amount of CDS a company can write based on its capital cushion and credit rating.
The voting power that comes with taking on debt should be somehow shared with the CDS seller so they have a say in the debt restructuring of the defaulting firm.

http://moneymorning.com/2009/04/23/ban-credit-default-swaps/

http://moneymorning.com/2008/09/22/credit-default-swaps-2/

Super Bowl

2012-02-06T20:10:00.000-08:00

The word carried a different meaning at different stages of my life, at least since as far as I can remember to have begun understanding the current affairs around me. For the most part I, quite obviously for an Indian kid, associated it with a grandiose event spanning over a thousand lanes with each game costing thousands of rupees and witnessed by millions of spectators. The name itself was enough to highlight the pride and honor that the contestants vied for and I used to imagine them sweating under pressure even in controlled air conditioned halls. Having played bowling in small arenas with just over fifteen lanes I could only imagine the clamor before each throw and the sound of applause at each strike. But then it all changed when I tried to fit in the infamous episode of Janet Jackson and Justin Timberlake into my framework and it didn’t quite add up. At this point I find it superfluous to elaborate on the events that took place on Feb 1 2004 and all I shall say is that a stage performance didn’t seem to gel within a bowling arena. But it didn’t make me curious enough to dig deeper and I let that muddle sit at the back of my head.

And then, one fine day, I saw Ted from HIMYM being overly fanatic about Super Bowl to the extent of constructing a device to block any news of the game when he failed to watch the live version. Quarterback, football, yards, touchdown were a few words thrown here and there and when I collated all of them they all, indeed, added up and I at least got clarity on the sport that the event represented. It was only recently that I grasped the magnitude of the game when it was compared against our own world cup matches. Although the viewership was restricted to just one nation the statistics stacked up quite impressively with cricket world cup that spans about a dozen nations and is the most coveted trophy in India. Of course none of these tournaments can be compared to the magnificent soccer world cup that manages to keep two billion eyeballs hooked onto the screen!

So, on 5^th Feb 2012 I decided to witness the sporting event myself. I was looking forward to it as I had learnt a few basics of the game quite recently and wanted to see if knowing the structure would help in building excitement. My friends had already reached Uncle Joe’s, a sports bar in the downtown and I joined them a few minutes into the first quarter. I was slightly surprised when I came to know that even though a quarter comprised of 15 minutes the timeouts stretched it to three to four times its size. Throughout the game I was trying to understand the strategy of the defense and the offense and discussed that with my peers who shed some more light on the feasibility of the moves we hypothesized. With the sheer wrath that the defense attacks the offensive “line” it seems remarkable how they are able to shield the quarterback who sometimes takes as much as 5-7 seconds to perfect the trajectory of his throw. It is hard to simulate, particularly for a newbie like me, the conditions under which the players play. With apparently no constraints or rules on how to tackle, cross, shield or intercept during the game I started to appreciate how the players worked through the scenarios that changed at lightning speed.

The Super Bowl game was between NY Giants and New England Patriots. During the game I got a chance to read about the enraging rivalry between the most able quarterbacks: Eli Manning of Giants and Tom Brady of Patriots, and I found it pretty impressive how Brady was able to maintain his calm in such a highly charged up atmosphere. This trait became much more evident during the final few minutes of the game when the Giants scored a match winning touchdown to lead 21-17 with just under a minute to spare. Now that I was familiar with the rules of the game and had information from the last couple of hours I could lay down the equation for Patriots to score a stunning win – about a hundred yards in under a minute. It had been taking about 3-4 minutes to cover that length and it would have been phenomenal were they to go through. The stress and the pressure was pretty apparent among the Patriots as we saw two incredible and extremely well calculated throws by Brady, with a potential to cover tens of yards, being dropped. Tension mounted in the bar and in the stadium as Brady took guard, seemingly determined to cross about 40-50 yards with just 5 seconds on the clock. With his “offensive line” firmly in place to shield him, he dodged the defense allowing him to concentrate and at the last second tossed the ball along his best calculated trajectory. The ball seemed well in line to cross the 100^th yard and then bounced off several players before tumbling onto the turf – The Giants blasted onto the field in celebration.

Although the bar wasn’t packed to match the expectations that I had with an event of such scale it was comfortable to watch the game with everyone seated on their seats. Fortunately for me my first Super Bowl was as close as it could have got.

Big Red Bikes

2011-11-23T22:39:00.000-08:00

Cornell has a program in place that provides bikes for students that they can rent for free! Needless to say there are time constraints and the bikes aren't of the quality you would see on display in any of the showrooms but nevertheless they fulfill the desire to roll down the slopes on wheels without buying them, something of interest for MEng students, especially, whose tenure doesn't give a steady season to extract the worth of such an investment. I came to know during the week that the coming Sunday was going to be the last day to hire the bikes before the chill sets in and closes the shutters till March next year. Setting aside the academic deadlines I propelled this task to the highest priority and within minutes me and my room mates were out the door to beat the winter sun that set at 5 pm (damn the Daylight Saving Time!)

The bikes were available at Uris Library. Just a few days ago I had heard about the A.D. White library that shares its entrance with the Uris Library and is built as a conjoined structure. With the description that was painted I imagined it to be a huge hall with large windows overlooking the entire city from the crest and palatial iron pillars that also served as book racks and were connected by iron pathways. The image magnified multifold in my mind and the thought of scaling it with the size of Uris Library never occurred and I pictured myself as a little dwarf when entering the A.D. White Library. So as we inspected the bikes and made our choice it struck me to steal a quick tour of A.D. White and Pratik offered to be the guide for the moment. We entered the Uris Library and took the turn to get to the main A.D. White hall. It wasn't even near as big as I had imagined but it was a pretty accurate miniature version. There were two big sofas that overlooked the libe slope through large windows that stretched across the walls. The staircase led us to a mezzanine floor that opened up into the iron corridors between the iron pillars. It was pretty amazing how the architect had designed small spaces between the book racks to squeeze in a chair and a table as if the library was reeling under space constraints. We went across the ferrous hallway through a door and into another big room that carried one of those lazy boy sofas with a foot rest, one of the best places I had seen so far to steal a quick nap in the middle of the day. Unfortunately we were hard-pressed on time and so we headed off to the counter to rent three bikes. All set with the cycling gear we warmed up with a couple of rounds in the arts quad and acclimatized ourselves to the braking mechanism that worked by pedaling in reverse. These were not the bikes equipped with a full range gear that could have made cycling up the hill easier than running. But, nevertheless, in our otherwise mundane lives that had been revolving around books and classes they provided an thrilling escape route to a journey we were eagerly awaiting! And so it begins…

Our first stop was Ithaca Falls and I’m going to try my best to put the experience in words. Imagine the state of a student who has had a steady routine of commuting between home and school and slogging with studies for a few months. And now imagine the excitement on their face when they are in an amusement park and about to ride a roller coaster that they have been wanting to for a long time. I guess that is how exhilarated we were when we let ourselves loose down the slope. We were outrageously ecstatic as our bikes accelerated to great speeds, so high that we could feel it going out of control with a slight steer and the brakes released fumes of smoke like a drag on a motorbike. Although that entire leg at the beginning of our expedition was quite short it gave an adrenalin rush that pulled us through the evening with a continued enthusiasm. We made a quick stop at the Ithaca Falls and took a few shots before heading out to the next destination, Boatyard Grill.

I was glad that I brought my complete outer wear - gloves, cap and jacket - as I was able to sustain the cold chill before our bodies warmed up and I lost the leverage. Since we had descended the hills we strode at a leisurely pace on the plains. It was really soothing as we smoothly sailed across the residential streets and before we knew it we had reached the small peninsula of Cayuga Lake where Boatyard Grill was. We took a round around the place and, to our delight, also saw the clock tower from quite a distance which naturally followed with trying to identify the different buildings. It was an amazing feeling of being one with nature as we sat at the tip of the peninsula and gazed through the endless horizon over the lake with a slight breeze flowing across. We had achieved a good feat that day and we decided to savor it with a delectable meal at the restaurant that was going to be one of the most sumptuous meals that I had had in Ithaca.

It was about 7 when we left the place and I again got my leverage back! But not for long. We had a few errands to run near the shopping places before we retraced our steps back overlapping Route 15’s path to a great extent. We had come to SW Shopping quite a few times on the bus but when we took the same route independently on the bikes we cherished the freedom and took short cuts that we didn’t know existed. It was quite fun to have the flexibility to explore different streets without having to travel in an encased box. Ultimately we reached downtown and saw in front of us a daunting uphill task, quite in the literal sense. Although I didn’t have too much faith in myself to pedal all the way up, Pratik and Aarav constantly instilled motivation into me and we let go of the Route 70 that was an easy gateway to the campus. Unfortunately my body gave in as I wasn’t even able to pull myself up half way to our apartment which is less than a tenth of the distance all the way up to Cornell. We then waited for the next bus to show up that marked the end to an amazingly adventurous day.

Say Halloweeeeennn!!

2011-11-11T13:59:00.000-08:00

As a kid I had always associated Halloween with something scary. A day when all the spirits resurface to haunt mankind; or a creepy place that lies eerily silent and is overwhelmed by ghostly activity; or the time when children are told to stay at home away from the potential perils that lurk the streets. Stayed at home they did but only for reasons you come to know after you celebrate a certain birthday! But could I be blamed? Staying in a land where celebrations of such style are uncommon, the eerie image of “Halloween” smeared on a wall, supposedly with a dark ooze-like material dripping slowly near the edges could not have conjured any other feeling. Thankfully it all changed when a group of friends transformed that image into the lively and celebrative mood that the day brings. A group of F.R.I.E.N.D.S.

I think I first saw the tradition of Halloween in the sixth episode of season eight of FRIENDS and it was exciting to see how invigorating it was. The celebrations depicted in HIMYM garnered more enthusiasm with the “slutty pumpkin”! Ok, I’m exaggerating a bit and I guess video could not take us through the joyous, colorful and party mood that engulfs the atmosphere during Halloween and it was only when I was a part of it this time that I realized its true spirit.

Halloween was on 31^st October, Monday, and I and my housemates had been planning weeks ahead of getting funky costumes and painting the town red! I was trying to make it simple but couldn’t help getting flashes of pictures with people dressed in creative costumes that I had seen in different media. The thoughts really motivated me to celebrate the event sporting a unique costume and I tried to combine cliché ideas into something thoughtful like using face paint to splash a pattern, maybe couple it with a wig or a face mask or just an eye mask and then tailor a set of clothes or get a costume to match the outfit, as it made sense. But since I didn’t want anything fancy the simplest of ideas ran across my mind – buttoning up two shirts together to form a “split” personality, cutting through my jeans and t-shirts to sport a beggar, rolling up a bed sheet or a towel in a creative fashion or simply dressing down to be an aam aadmi. During one of our visits to the Ithaca mall we had come across a store that seemed to be specially catered towards Halloween gear and we always used to sneak a glance from outside thinking to paying a visit nearer the time. But unfortunately academics took precedence and the mid terms squeezed all the leisure time out of our schedule and by the time our routines were restored the costs of the costumes had risen as they do of anything that has demand. So I chucked the idea of straining my pocket for this one time event and decided to sport a self designed costume to dress up.

I had limited network among people whom you would normally find engaging in such revelry and so I was trying to figure out with my batchmates of how we could rock the night. Coming from Bangalore, India, where the night ends before even the clock strikes twelve it was a lively sight to see people thronging the few bars and pubs that resided near the college and in downtown. To name a few, and I can say with much confidence that I would have covered most of the ones frequented by students - college town bagels is an elaborate hang out place primarily to drink beer and eat one of the zillion kind of sandwiches/bagels that you could pick from the graffiti on the wall; Rullof’s – the place where you’d see the densest of crowd with people scrambling over each other and deftly balancing their drinks in a rush to reach their spots; Stella’s – a fine dining restaurant-cum-bar; Pixel – a dance lounge with a couple of games. I avoid this place because of an uncomfortable experience that we had the last time we went; Level B – another dance club in the basement underneath Mehak, the Indian restaurant; Moonshadow – a night club in Commons; Miyake – the Japanese restaurant that holds a firm spot in my mind for being the place where I was introduced to Sake-Bomb. This is pretty much the nightlife around Cornell barring a couple of more pubs and clubs in downtown. My personal favorite is Level B and Moonshadow. Level B seems to be the only decent club in collegetown, and why would it not be for it competes only against Pixel! It plays good music and it caught my attention the first time when it played Mundian tu bachke rahi. Can you imagine? Walking into a dance club miles away from the nearest city in a “country side” and being welcomed by that song? It was a pretty amazing feeling! Moonshadow is a club I explored fairly recently on one of my friend’s birthdays. Here you would find a mix crowd consisting of students as well as people who reside in the vicinity. It has a small stage at the corner that we always end up occupying J and it plays some nice hip hop of the likes of pitbull.

Ok, so it was 28^th October and we had a pumpkin carving contest in our department and we all were encouraged to get on our craziest attire. I hadn’t planned on going but then succumbed to peer pressure and decided to give it a shot. It turned out to be fun and I also got to review my Stochastic paper as the time clashed with the event. I had paired up with my classmate who was the only one to dress up in the most bizarre costume, but truly apt for the festival. If I could put it nicely he had dressed up as a genie in a lamp that grants you three wishes when you rub “the lamp”. It was my first time carving a pumpkin and I should tell you that it is not easy to cut it as precisely as you’d want and what you get can be something totally different than what you think. You first had to chop a portion at the top to empty the contents and the seeds and then begin by sketching the cuts. I realized that carving a pumpkin is an art that is as well achieved by skill as by the carving instruments and to my defense we had half an inch thick knife that severely curtailed me from giving the prize winning appearance to the pumpkin. Although we thought of carving a sad face and had even defined the cuts with a marker, at every stage it turned out to be something different and we reinvented ways to redirect towards the original idea. I was satisfied with my first attempt but it was interesting to see the other ideas that people had come up with – a carving inside the carving, abstract figures, ORIE logo, bear, etc. It was then that we came to know that it was Akanksha’s b’day and we all planned on meeting at Miyake at night to celebrate.

Since we had a whole lot of time to kill I convinced Amar, Roni and Elijah to come to my place and try out the masala chai that I ever readily cherished. We came to my place and I was excited to introduce the Indian beverage to other lands. As the tea boiled and its intoxicating aroma engulfed the air I was anxious to get their reaction. I gave an anticipating look at each of their face and before they could say it I breathed a sigh of little triumph at their eyebrow-nod. Unfortunately it was something really strong, and I acknowledge that I should have put less masala, for Roni and he almost shrieked as if the spices twinged his throat. After relishing the tea at a leisurely pace and munching a few quick bites of choco chip cookies we headed to eat what I would call a supper before rocking the night! We each devoured a slice of pizza and then took the TCAT bus (oh btw, did I mention that buses are free for first year students?) to collegetown where we walked down to Miyake.

Now, let me briefly explain the activity called Sake-Bombing. I believe it has its origins in Japan and is essentially a drinking activity that, with its distinct technique and a unique way, brings a lot of enthusiasm, fun and excitement to the table. It follows a particular sequence where a glass is first filled with beer after which a pair of chopsticks is placed at the top with a shot glass resting between them that contains sake. The Japanese custom entails hollering “Sake… Sake… Sake… BOMB” and ending with continuously thumping the table with fists to topple the shot glass into the beer and then galloping the entire contents as fast. For us, though, our excitement took over and we ended up with a couple of accidents, an exhibit of which can be seen here, and of course we learnt after that.

So we join the gang at Miyake and begin the night with Sake Bombing. I had planned with a bunch of folks to celebrate Halloween the next day and I figured it won’t be a good idea to drink on two consecutive days and so I just enjoyed being part of all the hussle. And I must say that it was fun to see the revelry amongst the vivid and distinct costumes that the crowd was sporting with characters ranging from the predominant cats, wonder men, women and jokers to other animals, zombies, cavemen, etc. It would take away the crux if I leave it unspoken about so I would just slide a non elaborative mention about how the festival was leveraged to sport any costume that one wanted and it could simply camouflage behind the intent of Halloween. That helped people be whoever or whatever they want and hence assume any character in which they can rejoice that led to a sort of united celebrations across the town, something that you would not see on a typical Friday night.

I headed back home when the unanimous opinion decided to hit Level B but I headed back home. Then I just waited for the next night where I would get to unleash my creativity and rock the town! A bunch of my friends had organized a potluck at their place where I didn’t go after which we all gathered at another friend’s place who had got a face paint set. It was cold as hell and unfortunately I couldn’t come up with an idea with which I could fight the frost and still be in the right spirit for the festival so I decided that I would depict this dilemma with a “split face” paint. I didn’t know then but I was going to be taken aback by how daringly people had dressed up as if there was a shield protecting them from the chill. Chaintanya also sported a split face but in a different pattern and he pulled through the idea of buttoning up two shirts to mirror that trait in his clothing. Rohil, very aptly, dressed as a pumpkin head and diligently painted his face to actually support the big pumpkin on his head. And a couple of other folks mixed up the white black and red colors to become the “joker”. We then headed off on the bus to reach level B at about 11:15 pm. They had the Halloween theme party going on with a cover charge and I would say it was definitely worth it. It was after a long time that I let my hair down and was just swinging to the beats without a drink. We all took over the stage at the center and danced over the tunes till about 1:30 after which we headed over to another house party. The other party was something that I hadn’t seen before. It was a big house, supposedly a grad’s, that had a DJ system set up with enormous speakers that rocked the entire place at high bass beats. You had to be in the room that housed the speakers and the lights swinging in the tumult with the reverberations squeezed between the clamor and adding your own contribution to it.

I didn’t stay long and left back home at around 2:30 am. I washed my face and then eased back into the reality to wake up to routine. It was indeed a memorable way to celebrate the first Halloween!

iCon

2011-10-16T01:22:00.000-07:00

I bought my first apple product in 2006 during my internship in Toronto. It was a 32 GB iPod. It was more or less an impulse purchase as I was instantly amazed by the feel of the touchpad. Five years later I have purchased the iPhone and it truly is revolutionary.

I was sitting in my computer lab and the TA had just concluded a review of what we had studied in the lecture and how it had to be used to write a program. I was about to begin when one of my batch mates pointed to his screen and said “Did you hear that? Apparently Steve Jobs just passed away” I dispelled his remark assuming it to be headlines in some FakeNews.com to highlight the dismal response that the day before unveiling of iPhone 4S garnered, or so I had thought. To which he remarked “Well, if abcnews.com has published it, I would think it to be true”. I was speechless and shocked. I didn’t know how the death of someone whom I hadn’t met could evoke such strong feelings but I could not help myself mull over the thought. It took some time to digest the news and get back to what mattered at the moment. I had my prelim the very next day and I was finding it hard to get my mind off the incident and concentrate on studying. A series of questions flashed right in front of me. “What a co-incidence, iPhone 4S is launched and this happens the very next day? How is Apple going to uphold its brand? How will its vision stay put?” But it wasn’t those questions that stirred me but the suddenness of the event. I tried to come back to reality by actually chuckling with the thought of him not being able to withstand the thought of not having met market expectations but some how the back of my mind was really heavy with the news.

Why was it so heavy? I hadn’t even met the guy. I was a consumer of just one of his products and did I find it truly amazing. When I came back after my internship the ubiquitous white ear phones dangled from the ears of every other student I passed. Never before had there been a device that let you scroll through your playlists with such ease that you just wanted to keep scrolling. Never had there been a device that had as sleek and stunning a body as the iPod 5G’s all metal solid body. And today what strikes me the most is that every product launch that Apple was going to have in the succeeding years perfectly fit the punch line “Never before had there been…”

It wasn’t until a couple of years after I had graduated that I realized how each of the Apple products focused on just one central characteristic – consumer experience. The way it transformed the entire experience of consuming digital media is something beyond the vision that anybody could have, anybody except Steve Jobs. It is because of his ability to identify a need that even the consumers couldn’t that led to the beginning of a whole new era in consumer electronics. In fact, one cannot even call it a need. Simply put, with the iPod, it was just a mechanism to enrich the experience while going through the mundane process of browsing and listening to music and Jobs took it to a whole new level. It was his creative brilliance that pumped out a product year after year with each one designed way into the future and surpassing the then standards of any existing device. From the classic iPods to iPod nano, shuffle, video and then the quantum leap towards the iPhone and an even higher leap to the iPad, the streak just didn’t seem to end, but it did, or so it seems.

Jobs was a perfectionist. At least as far as the quality of the products he unveiled goes. He had a keen eye for detail and played a key role to develop the immaculate look and feel of each of his products. So strong was his design vision that he not only led Apple to procure a number of design patents but also prominently featured in many of them. A few of them credited to his name that were pivotal for Apple’s success were the lanyard for iPod headsets, the single enclosed design of the iMac, the revolutionary touch-wheel and even as minute aspects as the packaging of each of the devices. The complete process was intended to impart a unique identity to each of the product that was to be revealed as soon as the consumer began to unpack. He had brilliantly developed such a deep understanding of human cognition and the existing technology that he marvelously infused them as if he could foresee the digital future. He left no stone unturned in securing the availability of the best and state-of-the-art technology to test the prototypes and assemble the final device. So dedicated was Job’s approach and so impeccable was his vision that he spent about $150MM on developing the first working prototype of the iPhone. And that is not something hard to believe when you imagine that the entire phone navigation had to be mandated by a single touch. And here is where the design mapped the need, what a person would want to do, to a comprehensive screen with different display sections and an intuitive action to achieve the objective. The interactions were so articulately placed and sequenced that it wasn’t shipped with a manual to understand. So inclusive was the device, so smooth, intuitive, engaging and fast was the navigation and so effortless was its administration that one could not imagine its absence in the first place.

Even after being credited with being a pioneer in unleashing the next era of consumer electronics he was often criticized for exercising extravagant control and for his authoritative management style. And that clearly distinguishes Apple from the rest of the tech firms where freedom of speech and encouragement for creative thinking form the firm’s backbone. Featuring in a number of Apple patents bears testimony to the fact that Jobs was involved at each stage of the product development cycle and his enduring vision laid the foundation for each success. Even after maintaining exclusivity of his products and shielding his technology from the ‘open’ world he leveraged his marketing genius to find a way to inject his innovations into our lives. Erecting the entire foundation on iTunes and then creating a window’s portable version was a master move that quietly brought Apple at the helm of the digital electronics industry. In retrospect it seems trivial but it was nevertheless a brilliantly thought out move that propelled the iPod to one of the most successful products of all times. That provided Apple with a strong and loyal consumer base and, coupled with a multifunctional iTunes platform, a stepping stone to launch the next device. With the iPhone Jobs defined a whole new set of standards of communication, entertainment and lifestyle. He then seamlessly integrated a development platform for the iPhone that worked as a self sustainable unit providing the developers with a huge market to sell their applications and the consumers an array of tools to transform their phones into schedulers, gaming units, browsers or multimedia stations. Although he had an extremely talented team at his disposal, it was his foresight that primarily guided the entire organization. This imparted a secretive nature to all projects with unrelated teams having no clue about the bigger picture, to the extent that even the board was sometimes left in the dark to preserve the information that could compromise the hype for an Apple launch that was unparalleled in the industry and eagerly awaited. It remains a question whether such a model would thrive in Jobs’ absence and how it would affect the functioning of the company that rose through the ashes solely on the back of that model.

Without a doubt Jobs can be credited with pioneering the next generation in electronics. Moore’s law has been at work to crunch down the space that circuits occupy that blessed us with the era of personal computing and further paved way for the development of laptops, net books and then cell phones. But it was Jobs who added an emotional element to these devices, packaged them with an aesthetic appeal and transformed them into devices that worked on intuition. With every product Apple launched it lured the existing and established companies to create clones to cash in on the rewards only to retract back later when they were unable to outpace the spearhead. Even Microsoft made a futile attempt to replicate the success of iPods but it miserably failed in capturing any market share and its hope sank in the ripples that Apple created. “Good artists copy but great artists steal” is a motto that Jobs shamelessly upholds and the evidence of which can also be found in Apple Lisa that incorporated the GUI design that Jobs “stole” from Xerox in 1979 during one of his visits to the company. With the iPod, he was shrewd enough to cunningly steal the throne of music industry from Sony that had set its stronghold with over 200 million units sold of its flagship Walkman players. And then, with the iPhone, he defined a whole new paradigm in the wireless industry. iPhone completely changed the way communications was defined. So high had Jobs set his demands with the wireless service providers over the control of the service, the modifications to incorporate iPhone and the cut from sales that they struggled between choosing their control and the lagging voice service or the lucrative data service. Eventually, after even contemplating becoming a reseller of wholesale minutes, the stage was set. As soon as the revolutionary design was brought into the world it created frenzy and consumers thronged AT&T stores to get their hands on the trend setter. It created a multi billion dollar market and vested the power in the hands of the consumers. It took some time for the entire industry to assess the impact of this launch while AT&T worked to unclog its networks to allow the ever increasing traffic of consumers loyally switching their providers to work on the iPhone. Watching this trend sparked off another frenzy in the wireless industry that led all frontline manufacturers rethink their strategy and respond to the new sensation, touch, with HTC, Samsung and Nokia coming up with their own versions. This area became so hot that even Google dived in with the acquisition Android, an open source mobile OS. It even acquired Motorola for $12bn, $12 BILLION, to safeguard its position and, probably, with the hope to strengthen its development of an integrated device that can match the stature of iPhone. Although iPhone 4S again set records with sales topping ~3 million over the first weekend, it remains to be seen how far Apple can survive in the fierce competition without its visionary.

All said and done, Apple is not going to be the same without Jobs. The world is not going to be the same without Jobs. With his design acumen, his marketing prowess and his foresight he has left an indelible mark that has made the world a better place to live. He has left behind a great legacy not just in the form of Apple but also with his stereotypical design thinking that stresses the importance of customer experience and stretches the boundaries of technology to achieve it. It is the loss of such an attitude, such an innovative and visionary mind, such a pioneer and such an independent thinker that makes me grieve. It’s heartening to see him depart when he seemed, when Apple seems, to be at its peak. No matter how defining the next technology is and how closely it connects with the consumer’s emotions, no one deserves to reveal it to the world, no one can, in the way he did. That image of Jobs in his trademark black turtleneck, Levis 501 denims and sneakers holding the next big thing will forever be engraved in my mind.

R.I.P Steve Jobs.

Powerless...

2011-09-24T01:03:00.000-07:00

US is known to be a country that has a 24hr supply of gas, water and electricity but what I missed was the underlying fact that one has to pay for them and, as I came to know, one has to have them on their name first.

10^th August, Wednesday, is the day that marked the beginning of a struggle, a week long struggle. I came back around 4 pm and saw my landlord with some other workers engaged in some sort of repair work. It turns out that our building’s gas was leaking and they had to come to fix it. I walked up to my apartment and saw that there was no electricity and I attributed it to the repair work that they were doing. It was only when the landlord came up to witness some minor fixes that I had asked him to look into that he told me that they hadn’t shut the electricity off. He said that I needed to call up NYSEG and have the electricity put in my name. I had tried doing that a couple of times before and they always used to ask me my 11 digit account number before they could proceed but, coincidentally, when I tried today it got through and they took my request. They said that my electricity would be restored by Thursday… and I thought it wasn’t so bad, just a day more… the 18^th of August! I was spellbound. I asked them to repeat and I had heard it right – 5 business days which meant at most by Thursday, the 18^th of August, because of the damn weekend the 5 business days translated to 7 calendar days! With that they gave me the information that my brakers need to be in the off position without which they would be unable to restore electricity and hence their visit would go in vain.

And thus began my ordeal of dark nights! I, at first, couldn’t imagine how I would pass the day and I thought of taking shelter at some place till the problem got resolved but I then decided to take the situation head-on. It took just about a day for the eatable in the fridge to begin spoiling and it was then that I considered myself fortunate and thanked my Mom for stuffing the readymade food into my bags even when I insisted otherwise. My meal, for the next few days, was to be bread and some warmed up dish! I began waking up in the morning and spending the time reading, something that had got neglected in the past few months and that I enjoyed doing a lot. I went over quite a few prerequisites that were a must for my course and made good use of the morning time. It was on the second day that the dying battery of my phone begged me to nourish it longer and, considering who benefits, I caved in. And so I came back at about 2 am on Thursday when my phone indicated it was completely stuffed!

In a couple of days I had formed a routine until 12^th August when my first roommate came. As soon as he came we ventured out to take a stroll in the Campus and I showed him the Libe Slope and he was instantly awed. The Libe Slope is one of the most peaceful (or the noisiest, depending at the time you go) places on the Campus and the sunset at this place is breathtaking, i.e. if you can see the sun in the Ithaca sky! We then went to the engineering atrium which is a huge hall where you’d find students working over their academic challenges in groups, some sitting in solitude with headphones to break out of the daily routine, a few squatting on a single couch taking a quick nap while others munching a quick bite at Mattin’s. This is the place that has been home to me for the past couple of days and would be so for the coming few days as well. After empowering our devices in the atrium, I can’t recall but I think, we headed over to CTB. I showed him the most happening spot in Collegetown which is further highlighted for it being the first joint one encounters when exiting the university. We fed our stomach there itself since we couldn’t have made much in the dark and upon reaching home we… well, what else, fell asleep!

The next day was going to be a packed day. We had to go get my room mate’s phone and I had to go shop for my suit because we had to wear one during our orientations the coming week. The MEng program in ORIE is one of its kinds that have a week long orientation called MEng Connect that is aimed towards professional development of the candidates, but more on that later. So we went to the commons in the afternoon and looked at different options for him to get a phone. We inquired at the store called Cell Connect that is the place where most of the students buy their first prepaid connections, if not phones, from, primarily because of the low price and a good signal. We then wandered a bit more eyeing for another store that could provide us with competitive prices and at the same time I was looking out for outlets that showcased gentlemen clothing. I came across a store called trade something and it attracted my attention. As soon as I stepped into the store I could see different sections for different kinds of apparels, and that too a huge stock for the size of the store, with people thronging the entire vicinity. It soon became reminiscent of the janpath or linking road with all the stalls aggregated under a single roof. Essentially it was a trading platform where people could sell their apparel at 40% of its resale value. I did find a tie that looked neat but I didn’t have a suit and I didn’t want to start by buying a tie. So I ventured out and bang in front of me was Benjamin Peters, supposedly the only gentleman clothing store in Commons. I went inside and found the prices to be more than my budget and more than what, I guess, I would normally find in India. Nevertheless I strolled through the store and fortunately found a clearance section. Being an average 5”9” and the corresponding waist size, I have never been lucky in a clearance sale but I guess today was different. Today, I was in USA. I was in the land where my built fell below average by a margin, as I just came to know, and today was the day I was going to take the full benefit of it! I found a good deal on a suit and tried it well enough to conclude that it was a good fit. But I still was in a double mind as to whether I should go ahead and look up Walmart since it is known to have cheap options for everything under the sun. At the end of the day, I couldn’t order the suit I saw and had to wait until the next day to purchase it.

But this wasn’t the end of the day. We bought my room mate’s phone and we scurried off to our place as he wasn’t feeling too well. At first it seemed like just a normal cold and weakness but it soon developed into a fever and with no power it was a tough situation. I went to the Wilson Farms, which is one of the very few well equipped grocery stores in the vicinity with others, like Wegman’s, being a few miles out south, and got some fruits. I then managed to ask my fellow building-mates to allow me to use their appliances and edible items to prepare a simple dish that I could then give to my room mate to serve as a supply of essential nutrients.

The next day I went to Benjamin Peters, purchased my suit and left it over for altering. On my way back I bought a bottle of orange juice and picked up some paranthas from another friend’s that we could eat at home. Fortunately, as I reached home, my other room mate also came with his sister and her husband and they had loads of food packed with them to last a couple of days.

I do not remember very distinctly how the rest of the few days went but I received my perfectly fitted suit on Monday. On Tuesday I had my first day of orientation and both Tuesday and Wednesday were going to be really occupied for me and we were going to get power back on Wednesday. My first room mate seemed to be recovering slowly and he seemed to be in good shape by Wednesday. With God’s grace and the promise kept by NYSEG, we were back in power by the time I came back on Wednesday. As a part of the MEng Connect, we were working on a group project and I took leave from my group since I had to check the situation and take action if it wasn’t remedied, but thankfully it was!

Life had actually become a routine during that week and we, at least I, had adjusted to the same. It was because of this sudden change that I could focus on activities I earlier, and for that matter even later, used to ignore. I spent more time reading and talking to people and I realized how computer centric our lives have become. I felt that it wasn’t a bad way to explore, rather go deeper, into other activities by abstaining from the ones that occupy the most of your time!

Down the memory lane... Toronto

2011-09-02T14:54:00.000-07:00

Juggling between so many things – pre-requisites, meeting people, last few days for leisure before classes begin, badminton, where the next meal will come from – I tend to procrastinate tasks that have no tangible impact on my life, blogging being one of them. And this reflects on the numerous incomplete blogs I’ve started. But it needs to change this time and I need to finish what I started. It’s like a commitment and I owe it to myself to honor this commitment.

Ok. I’ll cut the chase but yeah… there have been quite a few events that have unfolded since the last time we met like the get together on 27^th Jul where a bunch of us met, my trip to Toronto, the moving into my apartment, the trip to NY and the electricity goof up!

As for our meeting, if I can remember correctly, and in no particular order, there was one girl who is doing Masters in Architecture Design, a guy doing PhD in electrical, a guy who had just completed his MBA from Johnson, a girl who was into her second term in Systems Engineering, another girl who was, I think, taking up an MS in Computer Science, if I remember correctly, and another who was doing a PhD in medical which required her to spend considerable time in the NY medical campus. It was nice to know folks from different fields as niche as they were and to go through their experiences that brought them here. One of them had studied at CMU in Pittsburgh and couldn’t stop comparing it with Ithaca that always inevitably ended up in Cornell lagging behind in the race. The Design major had some unconventional ideas of how to shape her courses in Cornell and the career thereafter. The Systems Engineer was mulling of which courses to take in the fall and was telling me that she was advised not to take any OR courses since they were known to rob you of your leisure time! The electrical PhD guy was fresh out of college and was excited to take on the challenges in the 5-6 year long stay that he has in front of him and the MBA guy was on the opposite end – had had enough life at Cornell with its ups and downs (in terms of temperature as well) and was looking forward to take up a job and start reaping the sown MBA seeds!

Ok. Let’s come to my trip to Toronto. This is something I had been looking forward to. Having worked at Capital One which has an office in Toronto I have quite a few folks who are either working there or were just visiting. There are just a few ways to go to Toronto – book a bus ticket with Greyhound that picks you up from the State Street Terminal and goes via Rochester->Buffalo->Toronto or try looking up for someone who is going that way and open for a ride. I actually found someone, coincidentally the folks I had met the other day and hitched a ride with them till Buffalo from where I had already booked a bus to Toronto. So it helps to meet people! We started off around 3 pm from Ithaca and reached Buffalo bus terminal around 7:15 pm after picking up a friend of theirs from Rochester at about 5:20 pm. I was in time for the 8:10 bus the ticket of which I had purchased but I was hoping to switch to 7:40 if there was space. Upon reaching I found that there were quite a few people for the 8:10 bus and just one for the 7:40 one and that made the chances of my move difficult. Megabus was what I had booked tickets on but the stop was primarily Greyhound and Coach USA’s. We had to wait for a long time before the buses arrived at 9:10 pm, all the while being told of the pathetic New York traffic that caused the delay. The Megabus staff on floor was trying out desperate tricks, actually they were being foolishly comic, to “entertain” the customers that was, frankly, more pestering than fun. Coincidentally both the buses came back to back with the 8:10 one stopping behind, and hence blocking the way of, the 7:40 one which meant that it would, ironically, leave earlier! We hopped on to that bus and, after spending about 30-45 minutes at the border, reached Toronto around midnight. While coming back I realized how lucky I was to have cleared the customs in such a short span of time.

My stay in Toronto was short and awesome. My friend from Capital One lives on the 22^nd (or is it 27^th?) floor and the view is AMAZING! The first day I went down the memory lane at U of T. Although the pita restaurant at College St. and University Ave. was closed, it felt good to be back in time, so to say J We then went to witness the liveliness at Dundas and Yonge and I was amazed to see the same street performers who used to sit there back in 2006. We had food at a Mediterranean place right in front of Eaton Center on Dundas and then we got some beer to drink at my friend’s place. Let me tell you, its an altogether different feeling to sit on the 27^th floor with the cool breeze blowing into your face, the sun setting on the horizon and dozens of ant-sized people buzzing on the ground. All this with a bottle of beer!

Other than that, we hung around a few pubs in the vicinity, met a few folks from my ex-company, went over to a pool party and that was pretty amazing and sat besides the lake, again another kind of relaxation! I was to take my bus back on Sunday but I hadn’t booked my tickets yet and when I inquired about the tickets, guess what, they were $80, CAD 80 which, they told, translated to $100 US. The same ticket when booked online costs $57. With an incentive of meeting another friend who had flown the previous day, I decided to book the ticket online for the next day that I can then have printed at the FedEx next to the Greyhound bus stop. And the decision was well made, that night went pretty well J

The next morning was terrible. With my bus being at 10 AM, I reached the stop at 9:30 only to know that Greyhound has a screwed up online schedule and the next bus would leave only at noon. Although they advised me to check if the 9 AM bus hasn’t still left and, to my utter surprise, there was a big line of about 70-80 folks including the ones for the 8 AM bus. With passengers piling up and no bus in sight the staff were helpless, or so they claimed, even to provide the basic information of when the bus would come saying that they had no means of getting in touch with the driver! Duh!! Somehow, luckily they managed to rake in another bus on way to Binghamton via Syracuse but they had no clue on how I would reach Ithaca! More astonishing and frustrating was the fact that the drivers claimed to have no idea where the bus was going even when they had boarded and began driving!

I had no idea what was in store for me at Syracuse. When I reached I was told that the only bus to Ithaca had left 30 minutes ago and the only way for me to reach Ithaca was to go all the way to Binghamton and then back following which I’d reach Cornell at about 10 pm. I told them that I had signed up for a 10 am to 5 pm ride and Greyhound is bound to uphold that reservation to which he said that the service is on a first-come-first served basis and is not guaranteed. Unaware of that fact I realized how careless and indifferent the staff was to passenger’s schedule. I went over my alternatives and mulled the option of going all the way to Binghamton but I couldn’t wait another 5 hours to reach home. Having thought out my defense I returned for another round of discussion with him and after much deliberation he agreed to refund the money. I felt victorious for a moment but quickly realized that I’ll have to shell out another $30 for a cab ride and demanded that I justly be given the extra amount since there was no reason for abandoning a passenger midway and they owed me a ride to Ithaca by 5 pm. He retributed with the example of the airlines that also operate on a first-cum-first-served principle but he soon fell flat on his words which was apparent from his pale face when I added that they compensate with $600 and provide a day’s stay in a hotel and all that am asking is $30 to cover my cab fare.

It was a sad experience and what made it worse was that the staff couldn’t own up to the situation and could not provide a satisfactory response that could alleviate the passenger’s concerns. I would think thrice before booking Greyhound!!

Apartment hunting: part 2

2011-07-27T17:59:00.001-07:00

Since I wasn't still sure of a place I shot a few emails and made a few calls to have a look at more apartments the other day. All three of them were in downtown, one on Prospect st., the other on S. Aurora and the third near the State Theater on W State St. Unfortunately all three were free only during the afternoon, around three, and none were willing to show around after 4:30. So I again set foot in the blazing sun.

It took me about 30 minutes to reach my first destination on Prospect st. Again, the sun was shining brightly and it was hard to look ahead without squinting. As I walked all the way down East Ave and then crossed Collegetown I again came across the digital signboard that read "100 deg F". I made a quick stop at subway, took a bite of sandwich and refreshed myself with some cold water before covering the last few inches. The house that I looked at was pretty spacious and was at a good location with commons just a few blocks away but then again the thought of going to college all the way was dreading, especially after listening to people talking about the horrific winters. Nevertheless, sooner or later, I had to take a place since I had been staying at my friend's place for almost a week and was still living from a suitcase so there was no option but to find the right balance between the cost and comfort from the available options.

I then headed off to the next destination, next to State Theater. Now this was right in the middle of Commons and had quite a bit of life around it. I was impressed with the location and the proximity to everyday needs. But when I went two floors up to have a look at the apartment I was disappointed. Actually, that day there was a smell of something burnt that was lurking in the hallway and the air in the apartment smelled stale. The top floor was really hot and the entire place seemed abandoned and plundered. I guess my opinion would have changed had someone been living there but, with such a spacious but empty apartment, I couldn't conjure a healthy image of living there.

Both these places were about $1750/3BR but the second one included utilities. I was so drained with such a long walk in the heat that I didn't have the energy to go look at the third apartment. I went straight to starbucks and sat for a while with a lemonade before I could cool off. On my way back I got a call from the apartment I was awaiting that there could be a possibility for me to move over since the landlord wasn't showing much interest in the other party. I spoke with the landlord and things seemed to be on track. There were a few issues around payment of security but I could manage all that and, in the end, we decided to sign the lease.

So we decided to meet on Sunday, 24th, to sign the lease. I was still a bit apprehensive because throughout the morning I couldn't get through the landlord to confirm the time but it was all ok when he called back. We decided to meet at about 8 pm in the apartment just so that I could have a look at it again and ensure that things were in order. That day the apartment wasn't as appealing since the tenants had moved quite a bit of their stuff and the ACs were also off. It was then that the landlord told me that the past week has been unusual for Ithaca as it has never gone beyond 90-95 deg F. This was also confirmed by my friend who, I was surprised, hadn't bought an AC even after living here for four years. So I guess this is just a temporary phase and soon its all going to transition to "white"!

We finally signed the lease and I am going to shift into my apartment the coming Monday. Btw, it was a coincidence that I found a college senior on the way and it was a delight to know that he was living in the house right opposite. In fact, in my very own house, the ground floor was occupied by my batch mate which was another surprise. It felt secure to know that there are known people living around and that there would be company.

Now, I'm keeping an eye on mails that advertise "moving sales". I can't wait to get my apartment, and my room, in shape!

Apartment hunting: part 1

2011-07-26T18:35:00.000-07:00

I'd open this post with a good news... any guesses? Well, I signed the deal and will be moving into my own apartment on 1st of August :D I left the previous post on just the first day of search and I think I should detail out the events of the week to give you guys a better perspective of how tough (or easy) apartment hunting can be.

So, I opened my bank account and, with all the research and work I had done to find the right bank, I feel I achieved a big feat. I took all the information that my folks back home would need to deposit into my bank account and that includes the SWIFT code that is not normally required in domestic wire transfers. It was an easy process. My parents had some amount transferred and it took a couple of days for it to show up in my account as available balance.

Now let me take you through the ordeal of apartment hunting. Tuesday, 19th July, was pretty hot and especially with the body ache that I was going through it was kind of unbearable. But, it was less unbearable than sitting at home in the heat and so I took off. I don't exactly remember the options I had listed but I had all the contacts of the appropriate houses that were advertised on craigslist and I used to keep refreshing the page every now and then to be the first one to apply to a $400/3BR ad!

Before heading off to the engineering quad where I normally used to sit, I covered ISSO and wrapped up all the formalities that an international student had to undergo. I then went to Gannett and inquired about SHIP since I had purchased student insurance from a private company (ICICI Lombard). They directed me to the SHIP office that's in collegetown, a 5-10 minute walk from Gannett, but in the heat along with cramped legs it seemed much more. I feel that, more than me, it'd have been annoying for others since I couldn't exert much force to ensure a smooth landing on a downward slope and I always ended up stomping my foot that was creating regularly spaced sound beats. At the SHIP office I got the information about filing for an appeal to waive the SHIP. It basically had to cover the six criteria and the form had to be submitted before Sep 7th, I think. During this time I would be required to pay for SHIP which will get refunded if my appeal is accepted.

So ya I then came to the engineering quad and took a comfortable space on one of the tables, shielded from the wrath of the sun. It was over 90 deg. F and cold drinks, ice teas and lemonades were seen in everybody's hands. I then jotted down the contacts of quite a few places and it used to take a long time in getting in touch with the right person, speaking about the apartment and then scheduling a meeting to have a look. I, then, eventually planned on having a look at all the apartments on Thursday. It was kind of difficult to make a choice between the areas because the North Campus is at an equal altitude but farther from the engineering quad than places further down collegetown that were located after a descent but closer. So do I chose more time and less effort or less time and more effort? But I decided to atleast make a note of all the places so I could cover them all at once while I was in the area.

So it was Thursday and I had my first appointment at 5 pm down E State St. It was 105 deg F that day and, I needn't say, it was sweltering hot. As I got out of my place I felt like going back and taking a shower again but I had to muster the strength to brave the heat because it was all for a longer term peace of mind. Although there were people walking the streets that day most of them had umbrellas while others were dodging for shade! Walking down inclines of about 30 deg for hours is sure to burn a ton of calories and that would have been the day for people wanting to do so. I took my first stop at the place down E State St. and had a look at a $1850/3BR apartment. As I had seen from the pictures it seemed to be an excellent place. Neat, clean, well ventilated, aesthetic and modern. But it seemed too far from my department and also more expensive than what I, along with others, had budgeted.

I then went up E State St to have a look at another $1750/3BR that was right next to Commons. I could actually feel my throat drying up and sweat dripping all across my forehead and face and patches of my shirt getting soaked in it. It was really terrible. The first thing that I did as soon as I reached Commons was get an ice cold lemonade. I then crossed the bridge to get to another place. The agent showed me around the apartment that wasn't yet ready. He gave me all the information and I saw how cool the place was and how well equipped the kitchen was the most important deal buster was that it was available only by the end of August.

The third apartment was the one I had associated my hopes with. It was a $1200/3BR with one of the rooms being large enough to accommodate two. Sounded perfect. When I went to have a look, it was pretty cool, as in temperature wise and a great respite from the heat outside. The tenants had maintained it pretty well and it looked really beautiful with small decorative objects showcased throughout the apartment. I would not go into the details but it met our expectations and except for being a bit further down Collegetown, where I would have ideally wanted to reside, suited our needs. I didn't commit then but contemplated the pros and cons of the apartment before contacting back after about an hour. There seemed to have been other people who had shown interest before me and who were given preference so I was still without a place.

Coming back home I discussed the situation with my friend. It was pretty easy for him since he had simply replied to a post in the Cornell community which was looking for two people in a house of six. That made me realize had I been looking for an apartment on my own I would have probably found one by now. There are always people posting for room mates when one of theirs leaves for some reason or the other. And for students who arrive late into the semester, it probably is the best option since most of the reasonable apartments/houses get taken by then.

So, by the end of Thursday I was still in a state of limbo. I wish I had made an offer on the spot. Not that I couldn't look at other houses but the heat and the climb and descent make it exponentially tough.