PhD Musings

A scary list indeed !

2011-07-27T21:33:00.001-05:00

http://www.treasury.gov/resource-center/data-chart-center/tic/Documents/mfh.txt

Sent from my iPhone

My Own Mortgage Story

2010-09-24T10:39:00.001-05:00

It has been a while since I blogged. I guess, I just got bored and took a break. A couple of conversations in the recent past brought me back here.

I met a friend who works in the banking industry who told me over a dinner conversation that my experience with my house in Michigan is so far removed from what they talk about in their corporate meetings on the housing crisis. My advice to them is to drive through the neighborhoods in Michigan and talk to a few homeowners.

Not that my experience is very atypical, the usual – bought a house in Michigan in 2003, paid a little more than what we should have, but nothing too pricey. We moved from Michigan in 2009, could not sell the house and therefore rented it out to a family. The tenants are in bankruptcy but pay our rent on time, except for a few hiccups now and then. We are just hoping that once the 3 year lease is over we can rent it back to them again or find someone reliable. We have little hope of selling the house at a price that will cover our mortgage dues.

Well anyways, the story si that when we put up our house for rent in 2009, we had a deluge of applications. However, most of the applicants were either bankrupt and/or did not have a regular job or were large famil.ies living on government support. I finally decided on our current tenants because they were a dual income couple with three children and seemed generally nice and reliable. They have been pretty good so far, they take care of our house and do not cause any trouble. So whenever they tell me they will be late in paying the rent by a month or two I don’t give them a hard time. I can wait if they promise me that they will pay eventually.

To spice up the story, my mortgage is on a 5 year ARM that is going to end in October of next year. At the current rate, even if the interest rates reset I will be paying a rate lower than my current rate. My state in Oct 11 will depend on what the Fed does with the interest rates.

I recently called Chase, the lender to find out if I qualify for any loan modification or refinance assistance. Here’s the transcript:

After a lot of punching of digits to get to the right place:

Agent: Hi, Whom Am I speaking with?

Me: Girish Mallapragada

The agent follows up with a lot of security questions and verifies my identity. Then..

Agent: How can I help you Sir?

Me: I would like to know if I qualify for any refinance assistance.

Agent: Let me check….she takes a while, looks up the value of my house..

Sir, your house is valued at X..and your mortgage is Y. The loan to mortgage ratio is 130%. It has to be below 125% for us to move on.

Me: I am ready to pay down some of the mortgage principal if I qualify for a refinance.

Agent: Let me check. Sir,…actually even if you pay down we cannot proceed.

Me: Could you please explain to me why I do not qualify?

Agent: Your loan is not guaranteed by Fannie or Freddie.

Me: I don’t know what that means. Did I do anything during the loan process that lead to this situation?

(I was pretending to see what she wud say)

Agent: No Sir, actually not. See, Chase packaged loans into bundles of say, 1000 loans and sold it to investors. Some of these were bought by Fannie and Freddie. If your loan was in a package that Fannie and Freddie took from us then you would have been covered.

I was actually surprised that an agent would even give me that explanation. Usually, they have no clue what not qualifying means.

Me: So you are telling me that I don’t qualify because of something that you did.

Agent: I wouldn’t put it that way Sir. There is little we can do to help you now refinance, unless you opt for a traditional refinance.

Me: And, what do I need for that.

Agent: Your loan value should be less than 85% of your house value.

Me: That’s not going to be the case for another ten years. Well, I guess that is it then.. thank you for helping me out.

Agent: Is there anything I can help you with?

Me: No, thanks. Bye bye.

Pramati leads the way with Qontext

2010-03-03T15:05:00.001-05:00

I admire Pramati Technologies not because I worked there a decade ago, but because of its incessant focus on innovation. A decade ago Pramati was a enterprise platform software vendor with a focus on products. Today, it has transformed itself into a enterprise solution provider without losing its focus on innovation.

Of particular attention is its drive into social media technology. Qontext, a new offering from the Pramati stable is an enterprise wide social media platform that is offered as a service. With Qontext, Pramati takes the power of social media into the enterprise.

There is ample evidence that implicit knowledge resides in a distributed, disconnected for, in the many silos of organizations. Although traditional knowledge management systems capture such tacit knowledge, they are not good at capturing the interconnectivity in the processes that lead to such knowledge. An enterprise wide social media platform solves this problem by creating a foundation for the various connected conversations in the organization to play out. Being able to access such knowledge and act on it can be a competitive advantage in a world where there is increasing data deluge.

Way to go, Pramati!

Causality and the Toyota Recall

2010-02-23T15:07:00.001-05:00

Toyota has been under fire lately with its never ending recall notices. The President of the company commented today saying,

We pursued growth over the speed at which we were able to develop our people and our organization, and we should sincerely be mindful of that

I cannot figure out what that means. I think what they are saying is that the recalls are because of Toyota's speedy growth. However, the real truth is that Toyota failed to stick to its quality standards and messed up. There is no universal rule which says quality needs to suffer with an increase in size. Toyota flinched from its legendary focus on engineering and design and probably sought to keep its costs low.

Further, it is also clear from the memos that came out yesterday that its North American executives were more intent on misleading NHTSA over negotiating recalls rather than focusing on their core values - good engineering and reliability. I am sure a bunch of lawyers also made money convincing Toyota's leadership that money can be saved by "convincing" NHTSA rather than try and address a design problem.

Toyota's case will probably be unique in automotive history. It stands naked and no longer invincible - not because it could not make quality cars, but because it chose not to.

In the name of innovation

2009-12-22T20:04:00.001-05:00

Many crimes have been committed by Microsoft in the name of innovation.
Not the least among them is the pain the company inflicts on the world through its MS Office software. Though slow on innovation and providing capabilities ot integrate with a collaborative workplace, Word is a behemoth a relic of the past where users worked on standalone computers. Yet, Office commands a lareg share of the marketplace due to Microsoft's dominance in the OS market.

One instance of how Microsoft freely "infringes" on other firms' copyrights while crying foul about open source comes to light with the news that a court rules against Microsoft. The feature under discussion, customizing XML is being called as "obscure functionality" by Microsoft. However, it indicates the technology unfriendliness of a company that only has cash cows in its product portfolio.

Blogged with the Flock Browser

Have you Flocked yet?

2009-12-22T15:13:00.002-05:00

Flock is a social browser. If you are the type that uses the browser the old fashioned way - meaning you do not engage with a community in consuming online content, then Flock is not for you.

However, if you an hour doe snot go by without you tweeting, blogging or updating your facebook profile, and oh, of course without checking your email (if you still use it), then flock to Flock. Technology is changing how we all interact socially and Flock tries to become the default platform for this social web. Its engine is derived from Mozilla's Firefox browser and that makes it all the more appealing as there is a large community of users who contribute to Flock through add-ons and extensions. Moreover, as Flock is open source anyone is interested in taking Flock and morphing it to suit the next generation of social media technologies, is free to do so.

You may be wondering where this leaves IE8 - well, have you seen any dinosaur fossils recently?:)

Blogged with the Flock Browser

Awesome Indian Food

2009-12-19T00:20:00.004-05:00

Some wonderful experiments were done in our kitchen in the past. A few that we photographed.

Asian spicy chicken - it was great with beer !

Haleem - amazing lamb dish. Authentic hyderabadi haleem, courtesy Radhika. It was slow cooked for about seven hours.

Awesome finger food - it is called Chicken 65 in India and I cannot vouch I know the logic behind that name. One thing I can tell you is that it goes well with beer and tastes awesome!

On Open Collaboration

2009-12-11T09:20:00.004-05:00

Baldwin and von Hippel have a nice HBS working knowledge article on open innovation models. Many applications of user-involvement exist out there - Twitter, Youtube and Wikipedia, to name a few. The impact of such collaboration has a huge relevance for firms because it offers them new means to engage customers and possible develop and design new products with the aid of such engagement.

An epitome of customer service

2009-12-10T20:05:00.001-05:00

There are no words to describe what AT&T is asking its customers to do. Let me give it a try.

Hey .. use our cell phone service, use our latest phone - iPhone, pay a fortune for doing so.. but you know what.. please go easy on using it. If you ask me, Apple is the devil incarnate .. it knows how to tempt people with really smart devices. However, the laggards that cell phone companies are, they are not able to match the sins of apple in innovation. My guess is that At&T will continue to struggle to meet iPhone's capabilities.

My take on it is that Apple did the wrong thing by not going to the other providers quicker. The slow pace of change at AT&T's side can be explained by the temporary monopoly it has on iphone customers. Take that our and the web will be a much better place...

For a Few Dollars More

2009-10-21T10:09:00.001-05:00

I like my rights. In fact, as an immigrant I appreciate what i enjoy here in the US.

As a dutiful taxpayer I realize that my tax dollars are at work when my car does not hit a single bump on I-40 from Chapel Hill to Greensboro. I also realize that my tax money pays for public schools, community health programs among other initiatives. I realize there are benefits I gain by paying for these programs and willing to bear the burden.

So, in really tough times when the Prez calls on everyone to support a health care initiative that has the potential to insure a big chunk of the 40 million who are currently uninsured, I jump right in. I know that the current system is working but I also see the trajectory and realize that if nothing is done then things will only get worse.

Individuals without insurance just end up emergencies and add to the taxpayer bill. I would rather insure these folks, get them to see the doctor regularly and reduce loss of life and cut costs at the same time. Further, I don't see what is the moral wrong in trying to provide a safety net to the millions who have little hope for good health. if I have to partake a few hundred dollars for the sake of saving a few kids' lives, I would gladly do do. Liberal, conservative or libertarian .. I think saving another person's life is never a bad thing.

For a few dollars more, a life saved is a wonderful thing.

A pleasant surprise to the sustainability movement

2009-07-16T09:03:00.001-05:00

Wal-Mart announced that it is committed to developing a universal rating system to measure the environmental impact of every item it stocks on its shelves. There couldn’t have been better new than this to groups and individuals interested in reducing the negative impact of consumption. A typical Wal-Mart stocks close to 100,000 SKU’s and rakes in revenues of about 100 million USD a year. With sales surpassing 400 billion USD Wal-Mart has a big impact on how other large retailers conduct business.

If Wal-Mart pulls this stunt successfully then it would have helped energize the revolution in the corporate world. Yes, many firms have had starts in this direction but the impact that Wal-mart’s decision may cause is manifold. Its entire supply-chain consisting of many thousands of suppliers would be forced to cough-up information. Such disclosure would create more competition among suppliers to create products that have a lower negative impact on the environment.

Arguments against the sustainability movement include high costs and a move such as this which leads to higher competition among firms will force them to innovate and hopefully reduce manufacturing costs. Three cheers to Wal-Mart!

What is a good product?

2009-06-30T10:12:00.000-05:00

Gone are the days, when firms made a good product, communicated to the customer, made it available and offered financing options towards purchase.

Competitive dynamics, market clutter among other things have forced firms to rethink how they can sell a consumption experience rather than a product or a service.

Latest in this stream of product design innovations is the new offer from Hyundai that comes with a pricelock guarantee on gasoline. Well, definitely not pioneering because Chrysler used it previously, but, it is definitely a more aggressive tactic in the time of a recession.

Hyundai has clearly shown its intention to grab market share as GM and Chrysler struggle in and out of bankruptcy. They have adopted a multi-faceted approach that includes product innovation, warranty and now this.

I have used a similar pricelock guarantee when I was a customer of Time Warner a couple of years ago. However, this is new because the price of the underlying good, gasoline, changes everyday unlike Time Warner’s case.

The company behind this offer describes itself as a technology and risk management company. The logic is simple – they have hedged their risk against the price of gasoline and can therefore afford to cap the price.

From the customer’s perspective, there is clearly a nice inventive here. What is more interesting is if these price guarantees will find their way to other consumption contexts in which a primary good + secondary good together determine the overall utility of the product.

Think of the razor + blades.

Premier Passenger status – purchased a priori and then a guarantee of low fares. Far fetched, maybe …but what else is innovation!

Taking care of the customer

2009-06-25T10:50:00.001-05:00

Believe me, when companies want to screw up - by God, they will.

I had to make a short and unplanned trip to Detroit recently, and tried to make a rental car reservation. To my dismay, not a single rental agency had any cars available o location. Anyone who has been to Detroit before will realize that getting to the suburbs without a pick-up or a rental car will leave you poorer by about 80 dollars, the amount you will spend on a taxi. Not willing to spend that kind of money, I decided to gamble and go directly to the rental offices to figure out if I can get a car.

What I did not know was that the Baptists were having their convention in the city and for some godforsaken reason, the rental agencies had blocked every single car for this convention. I could not believe that their planning was so dismal. They were not willing to rent a car for a higher price either. So, eventually I found no cars to rent and took a taxi to my destination.

I tried looking up the internet in the afternoon for a late night rental car pick-up and presto, they were available now. An economy car, think Chevy Aveo, was going for hundred dollars a day! With no choices, I got a ride to the airport from my wife's brother-in-law and managed to get an economy car.

Now, the point I am trying to make is this - the rental agencies had cars sitting on their lots all through the afternoon. However, they were supposedly on reserve for the convention. They were willing to turn down walk-in customers who are likely to pay a lot more in favor of a group that may never turn-up!

Taking care of customers - it must be some kind of a joke.

A 'king"fishy tale

2009-06-19T15:38:00.001-05:00

People were taking to the planes in hoards, I was told back in the summer of 2006 when I was in India on a short trip. I did not get the chance to fly a domestic route in that trip, but got my chance when I had to fly to Mumbai in December 2007. The (old) small hyderabad airport in the heart of the city was so crowded that it looked like a local bus stand called "Imliban".

People who don't look anywhere like the frequent flyers in the US were sitting on the floor waiting for their flights to Bangalore, Vizag, Mumbai and other cities. I was even amazed to learn that th flight to Rajahmundry was full. Air Deccan.. my friend, had changed the rules of the game. Through it low pricing and a loss-leader strategy it grabbed a nice market share of a fats growing market. There were other similar firms - SpiceJet, Indigo which followed a similar low price strategy. I deliberately use price, instead of cost because operating an airline at low cost is a myth, at least during the period when oil prices where at a peak.

The incumbents were the state owned Indian Airlines and a couple of large private operators - Jet, Sahara and Kingfisher. The entry and success of of low cost operators such as Deccan and SpiceJet set forth a wave of acquisitions and eventually Jet Airways ended up buying Sahara and Kingfisher snatched the real prize - Air Deccan.

What Mr. Mallya did not realize was that he wouls have been better off waiting it out and letting Air Deccan collapse due to its low-priceapproach. An implosion that was bound to happen, given the strategy Air Deccan had adopted. He could have snatched Air Deccan for a much better price today. However, hubris as they say may have played its role in the King's acquisition of Air Deccan. He purchased Air Deccan on the premise that the market would continue to grow and that he would be able to somehow integrate Air Deccan's low-end positioning with his airlines' premium positioning and also end up gaining market share. Surely, wrong timing.

The credit crisis, high oil prices, fall in demand and oversupply all semm to cause a problem of demonic proportions for many airline operators including Kingfisher. I wouldn't be suprised, if the only choices woudl be Jet and Indian Airlines at the end of the day. And, maybe one low-cost operator.

Mr. Mallya is still denying that his airline is in trouble but if the current downturn continues then there is no way Kingfisher can come out of this mess. When Mr. Mallya launched his airlines, I presume he was trying to emulate Mr. Branson, or maybe not. Whatever maybe his reasons for starting an airline, he sure quite a few reasons for not being able to manage it well.

Google’s money making machine

2009-06-17T12:14:00.007-05:00

Have you ever wondered how Google makes money. Yes, we all know that they do by placing ads – strategically. However, I always found irrelevant funny ads that were totally out of place – Here's one that I found recently on CNN's website:

Well, the first ad for lowermybills.com does not look like an ad placement. But, I was not sure why that ad popped up there and why those two girls were dancing. Secondly, the ads by Google indicate how much more work is needed before customized ad placement becomes successful.

The original article was reporting protests in Iran and there is an ad for Iranian personals, chronic back pain relief and heart attack survival.

No space for mypsace

2009-06-17T11:20:00.002-05:00

The social networking world is crowded. I had blogged about how MySpace a very weak generic positioning that may stop it from becoming a dominant player. If the recently announced layoffs are any indicator Myspace may have more bad things coming their way.

It seems to me that there are too many platforms and too much easy money chasing the wannabes. A classic run-up similar to the heydays of the Morgan Stanley financed B2B exchange for plastic bolts. There were other similar euphoric dramas of course, like the thirtieth online pet food store financed by VCs. I do not buy the argument that because some high-profile VC firm financed a start-up it has future, or because Fox took interest. Most successful ventures are under the radar - just as Google was during the internet boom. I predict that by the time the current economic downturn ends many of the SN wannabes will be gone. I still place my bets on Linkedin and then, Facebook. Linkedin because it gives social networking a clear purpose - maintain professional contacts and thereby possibly benefit from them. This notion seems simple but is elegant and has been studied quite a bit in sociolofgy by great scholars like Mark Granovetter and Ronald Burt. Facebook because it is the most well thought out generic platform for maintaining personal networks.

God's credit crisis

2009-06-12T11:30:00.001-05:00

It is said that Lord Balaji had to borrow millions of rupees from Lord Kubera to pay for his grand wedding many thousands of years ago. Taking inflation into account that must be godzillions of rupees by now. Devotees make contributions to the Lord so that he can continue to make interest payments to Lord Kubera.

Even God had to be bailed out, no wonder General Motors and Citibank need one. It is usually the taxpayer who steps in. Well, I take that back - once in a while a rich devotee such as Mr. Reddy makes a big donation. A diamond studded gold crown that weighs 34 Kg and costs over 45 crore rupees (about 8 M USD). I guess Mr. Reddy expects a ticket to heaven or wherever he thinks he will end up after his life here on earth. What he does not realize is that he is not helping the Lord by any means. Buying assets for a person who is in deep debt does not help that person. Will Kubera take it easy if Balaji wears a gold crown instead of making payments? It is like a homeowner in Michigan buying a Ferrari - does that make any sense to you. Throw in the eccentricities of the commodities market and gold may not seem like a good bet if stocks start rising!

Even if we try to convince ourselves that by heaping carbon stones on God we get in his/her good books, we should not forget Economics. Lord balaji must be cringing looking at the crown and what Mr. Kubera's reaction to the crown will be. If you believe in God, make a cash donation - so that it will get used in some public works project and at least go to Kubera's coffers and make the Lord's life easier.

Disclaimer: I am an atheist falling off a cliff and therfore have no interest in the credit score of any person real or fictional mentioned in this blog post.

A not so forgetful past

2009-06-11T12:45:00.002-05:00

I graduated from IIM Lucknow and I am proud of it. Whenever someone asks me where I got my MBA, I don't say India and neither do I say IIM - I make it a point to say IIM Lucknow. A recent email on our IIM alumni list motivated this post. A guy who graduated a long tiem ago from IIML was appointed as a Senior VP or something at a US firm and he forwarded the press release to the IIM L alumni list. However, this press release said his MBA was from Darden and never mentioned IIM L. I was wondering why in the hell did he post it on the list and another alumnus popped the question on the list :)

I have known a number of people who get an MBA from one of the IIMs and for whatever personal reasons decide to pursue another MBA from one of the top US schools. I don't have a problem with that, but being an alumnus of one of the IIMs I feel sorry for the person who tries to hide the previous MBA, particularly if it is from an IIM.

I had exhilarating fun when I was a student at IIM L. I think I met some of the brightest of minds including Abhijit Rey, Jayarama Krishnan, Shashank Rathi, Puneet Satyawadi, Rohit Sood, Rahul Jain, and Niraj Kumar Singh, just to mention a few. I also met some of the most balanced people including Neeraj Aggarwal, Gautam Mehrotra, and Akhila Patlolla, among others. And there are many such Raghu who will probably remain friends for life. IIM L offered me a chance to interact with these guys and learn from them. IIM L offered me a direction in my life, an ambition and a purpose. I cannot imagine people can spend two years of their life at aninstitution such as an IIM and not credit it for who they are. IIM L shaped who I am right now and offered me two of the best years in my life. If there is anything I have accomplished in my life, I would credit it to the two years that I spent at IIM Lucknow. I don't feel sorry for those who try to forget such a wonderful past.

Solving problems is easy : Watch Telugu Cinema

2009-06-10T16:52:00.001-05:00

Yes, I figured it out. There is a very easy way to solve all the world's tyranny and corruption. It was in front of my eyes all along, being shown day in
and day out in the hundreds of movies that Telugu Cinema churns out every year - beat up the bad guys! It is that simple.

I have been blessed with the privilege of having access to three telugu channels off late - Maa, Gemini and Teja. They once again reminded me that, tyranny, corruption and the set of similar problems that plague a country like India are very easy to resolve - just beat up the bad guy or even better make him meet St. Peter.

I can understand if a movie made generation ago or maybe a few movies relied on this ending - but every movie? It amazes me that today's producers have innovated nothing. They just continue to produce the same movies with the same story line - a boy, a girl, a father, some evil, fights, an item number and then the climax.

Evil gets beat up quite often and hold on, the hero somehow as superhuman powers and can beat up over a thousand guys without tiring. The race now is to film a fight sequence where the hero beats up over a million guys? I am kidding, but they all seem to take inspiration from Neo.

A second favorite peeve apart from the superhuman powers of the male character - the female lead is a dumb, stupid lass who is only alive to admiringly look at the make lead and imagine getting wet in the rain where she can then take off her clothes. In addition, the number of female leads who can even dub their own voices hovers around zero most of the time. If I close my eyes and watch a movie, they all sound like Aarti Aggarwal to me. Well, she was the first actress who got the now famous dubbing artist's voice.

And yes, there is a bad local policeman who will turn up at all possible scenes where the presence of police is required. I almost forgot - there is a villain who relocates to a different city in the past and has a chela who runs the evil deals in hyderabad.

What is going on? The only thing that sustains this never ending stream of stupid, dumb movies is the stupidity of the audience. I guess, they deserve this nonsense.

What does the future hold for avid telugu cinema fans - more dumb lasses all with Aarti's voice, more telugu heroes beating up even more extras in a single fight scene, more dads wantign to destroy their girl child's love interests and more villains who have relocated to calcutta.

A silent transformation: Google Finance

2009-06-05T12:57:00.001-05:00

I realized today that Google Finance was no longer beta! I guess many would have not noticed, and maybe it is not a big deal. However, it does show
how Google still is a one trick pony. As techcrunch reports, the market leader is still Yahoo Finance.

I prefer google for its simplicity and because I am so tied into using its other products - including mail, calendar, reader, news, maps and scholar. However,
it aches me to see that it is yet to realize benefits from all these new products and monetize them successfully.

Search Engines and Emotion

2009-05-28T11:44:00.001-05:00

I could not help rolling on the floor with laughter. What else could I do after I read this comment by a Microsoft employee in a news article,

He said Microsoft was hoping to build an "emotional connection" between users and its search engines, as well as brand loyalty.

Emotional connection? What the heck is he talking about...ok, here goes.... let me give it a try.

I get up early in the morning, make some coffee, switch on my computer, open a browser, get butterflies in my stomach, think of puppies and infants, sniffle a little, think of gardens filled with flowers, tons of more babies and then make a decision finally ... to open Bing, Microsoft's search engine instead of google. Maybe, I don't get it.

Too much has been written about search engines and consumers. Google cracked it through its simple UI, period. Brand Loyalty is a result of this simplicity in design and execution and there is no way a company like Microsoft can make the same thing happen.

Much ado about nothing

2009-05-21T18:28:00.005-05:00

The only hope I had for Chiranjeevi was that he would provide a third non-casteist platform for voicing socio-economic issues. I heard rumors that some of his candidates were distributing money for votes and that even he took money from some of the candidates. Some of these were allegations by defectors from his party. And various stories unfolded.

I had blogged earlier saying that he was grossly mismanaging his campaign and that surrounding himself with people like Allu Arvind was not going to win elections. A disciplined approach to convincing the electorate that his party would be a viable alternative at the state level was completely missing. He resorted to announcing populist schemes that lacked economic rationale - these were good in getting PR but not votes.

A sane advisor would have told Chiru that it is very unlikely that he would win the majority. At best, he would have made a dent in TDP and Congress. If Chiru had run on that premise he could have argued that he was here to stay and that he was concerned about the state's populace. He would have had legitimacy as a leader and created a strong presence for himself in the state's political arena. People would have respected him for what he intended to achieve. However, he let people like Allu Arvind go live and denounce the exit poll results saying that they would win at least 160 assembly seats. What was he thinking? This is not making a stupid movie like "Bunny" with Allu Arjun as the hero.

The people clearly showed that they were not stupid and that they can see through the lack of political legitimacy. Chiranjeevi is no NTR and 2009 is not 1984.

The sole positive was the hope that he would offer a third alternative to the lacklustre performance of the congress party and the caste-ridden politics of TDP, not to mention its film stars. However, he failed miserably due to the masterful leadership of YSR. Full credit to him for making Andhra the former bastion that it was for the INC. Congress strengthened its position at the state level and the usually anti-incumbent Andhra electorate trusted YSR to continue to lead the state. I have little hope for urban development under the congress party. For that we need Babu. YSR has put bigger holes in the state's finances by the pro-poor policies that he had adopted - a good tactic for winning elections but a poor strategy for the development of the state.

It would have been nice if he can make tough choices by focusing on industrial development and incentivizing entrepreneurs rather than subsidizing farmers. My recent trip to Hyderabad indicated that corruption is rampant and the stat infrastructure is falling apart. Hyderabad's residential real estate market is continuing to plummet and commercial real estate has fallen even further. The roads are back to pre-TDP days and APSRTC, once a crown jewel, is shabby and unclean once more.

Although I do not agree with Atanu Dey on many things, he has really convinced me that only cities can be the engines of growth for the 21st century. There are economies of scale at work in urban centers, the benefits of which can never be matched by its alternative - rural centers. The sooner YSR realizes this, the better. One credit that Babu deserves is that by fluke or by design he seemed to have realized this. YSR is yet to show that he understands what is good for the state and not just for himself.

On a final note. I like that fact that all the pesky small regional parties have been wiped out. Stability is boring, but it is good.

Twitter, seriously who has the time

2009-04-23T08:29:00.001-05:00

I like blogging. Tweeting - hell no! Who has the time?

I cannot understand why people would want to know trivial things about others and let others know what trivial things they do - where they are drinking coffee, what they are reading. As a society it is understandable that we generate and consume more information than we have ever done in the past - but tweeting?

I teach a course on product management to the Tar Heels and most of them seemed to agree with me. I tried to introduce them to SecondLife, Facebook, Twitter, and Linkedin and the only thing that seemed to gel with them was facebook and I had to hard sell linkedin. Secondlife and Twitter got the most sneers.

I agree. Who has the time to live as an altar in a virtual world and buy fake real estate on an island with real money. There is more wasted land lying aroudn in the real world after the economic bust. Comign to twitter, I cannot believe that people who have normal jobs and work 8 hours a day have the time to tweet. Much of the marketing hype that surrounds twitter is just liek the hazy cloud that surrounded the 5th online grocer back from the.com days. I had written earlier about the various social networkign websites here.
That blogpost drew some interetsing comments from someone who claimed to be one of the founders of myspace. True - you could look at investor interest to figure out the "potential". But history has shown tiem and again that early investors are very poor in calling the right winners. For all the Ram Shrirams aroudn there are many unknowns who have lost millions. As an intelligent investor, I woudl rather look at simple things such as if they have 1) a sound business plan to make money 2) invested in processes and 3) can do it better than others.

Wish it was that simple...

Outrunning the bear

2009-04-22T13:32:00.001-05:00

I read a story once whose moral was that if a bear confronts you and a friend in the forest, you don't have to outrun the bear but just your friend.

The great saga of the detroit Big Three has a similar undertone. Ford has managed to outrun the other two and come out the winner. It is so hilarious to watch Goldman pick the winner as Ford, the same day GM announced that it will miss a June 1 debt payment. Firms that have built-up fortunes by providing financial advice have more than adequately shown that they are no better than a monkey doing the same thing. It is a wonder that they are still managing to offer advice.

For many years Wall Street has advised common investors to invest long-term while they made short-term profits with the greeks. The irony is that the greeks came back to haunt them badly and lead to many a firm's demise. There are no magic tricks to long-term investing except discpline and common sense - something the fianncial world was found wanting.

Real estate, Satyam and local goons in Hyderabad

2009-04-22T06:51:00.001-05:00

Yes, Satyam provided livelihood for thousands of employees when it was run as a business.

However, it was just a front for hoax companies that made money in other investments such as real estate and agriculture. By inflating Satyam's revenues Mr. Raju and his team created an efficient machine to generate cash on the equity markets and then use that money to do whatever thay wanted - grow grapes and build apartments, among other things.
It seems unbelievable to me that people did not know this was happening. Maybe many employees did not, however knowing the corruption in India's system I am sure there are many more who got rich due to this nice scheme. The few auditors are just a drop in the ocean.

The real estate boom created by the economic growth in Andhra has lead to incredible riches for a few. It is not by happenstance that people like Muralimohan have made thousands of crores in the Madhapur real estate boom. Why Madhapur and no place else. We have come to accept the corruption that was behing the whole high-tech city boom because we are just like sheep. Why don't we ear about that few farmers who made hundreds of croses when they sold their land to developers? Because there aren't any. Land grabbers just take whatever they want and leave nothing for the true owners. Local authorities are either spineless and are scared of goons tied to political parties, or are themselves involved in taking bribes for dual registration of such lands. Congress is no better in such grabbing - it is just that whenever the government gives out a good fat contract one of its kith or kin will be a partner in the beneficiary company. It is amazing how politicans have figured out ways of making money off of the taxpayers.

People who vote for politicians with a criminal record shoudl be ashamed for the same reason. By giving them a legitimacy to carry on their evil deeds we are foregoing our right to question them. Once they come to power, we don't see them doing much because they are busy making money for themselves and their family through the intelligence of their own or by riding on the back of people like Mr. Raju. they also support an entire ecosysmte of local goons who survive in the name of the party's local strength.