newviewsonoldworld

A peek in the multi-dimensional magic Nature sure is an artist ! in every flower pattern , every tree shape, in the flow of rivulets you see art and you hear music. Though most of it may seem beautiful to us due to its abstract nature, it is in fact as precise in form as it can get … it is in fact based on the language of mathematical poetry called probability. Probability is what brings about the patterns that we see in the flowers or the movement of birds ( though physics underlies the principles the patterns are still probabilistic not deterministic) or even the design of the cosmos. The rhythm of the cosmos i.e the frequencies at which matters vibrate due to a confluence of forces like gravity or the weak and the strong forces are all probabilistic. our very own light also is a probability wave. Information itself that is a manifestation of randomness ( the less likely is the occurrence of an event the greater is the information contained in it ) is is a function of probability. Wh...

How Google works? Have you wondered why after an ant finds out food how quickly the others arrive and how quickly do these tiny creatures take care of so big a load ! the ant work on collective wisdom to take decisions rather than individual intelligence and therein lies the power that enables them to optimize their meager resources. When the NASA spaceship Challenger unfortunately broke down taking lives of all astronauts and caused a huge shakeout in NASA’s program the blame of technical failure was laid upon three Companies that made the jet section, the fuel section and the communication section. The NASA took 2 weeks to point the blame on the Company making the jet lining. But the US stockmarket took less than 2 hours to proclaim the verdict. The stocks of all 3 Companies fell heavily immediately after the crash but recovered slightly as the day progressed – the only stock that did not recover that day was that of the Company making the jet lining. How did the stock market come to...

Bridge over troubled waters “ when you are feeling down….. I will lay me over, like a bridge over troubled waters” In the US in the good old times of Alan Greenspan the denizens of the Wall Street and Corporate US believed in a strange option which they called the Greenspan put. They believed that if the economy went through a downturn then the Fed will take measures to provide a bastion to the investors and the Corporate and allow them to recoup from their financial problems. Hence provide a virtual put to them on their investments. When the hedge fund LTCM went down after the Russian crisis and the crisis created fears of strangulating the liquidity in the markets and pushing the economy on the edge of a reversal ( the South East Asian crisis had already created a huge expectation factor towards an impending crisis ) . Alan Greenspan reduced the interest rates gradually in steps 17 times. This prevented a spiraling liquidity crunch ( liquidity crunch >> rising interest rates ...

The true contra man with the true contra stand “ two roads diverged by the woods and I took the one less traveled by and that is all that made the difference” -Robert Frost that is all that makes a difference ! between the guy who makes money and who makes a lot of money.. a guy who thinks opposite to what others think and has the cheek to think he is right when others think he is a insane ( they all say it because they all say it ! ) .. such an impetuous guy is the true contra man and such men made histories on the Wall Street and Dalal Street. The contra man thinks always in causalities.. he is a top what if thinker and can link the events in a necklace of time and geography to make seemingly worthless stones as beautiful as China jade. Now think… what if ( God forbid!) there is an earthquake in Tokyo ! and you are an investor with a lot of money. There is panic in the investors, everybody is selling yen and g...

Tamaso ma jyhotir gamay! ( deliverance from darkness to light) You are an entrepreneur in the semiconductor business and your Company has just received level 1 funding from a VC who has faith that your Company will the next revolution in the semiconductor circuit development. And aye uddi uddi uddi you are going home a happy man. You stop your bike at the signal and you see that the kid who sells peanuts is trying to read a comic series on the paper that he uses to wrap the peanuts ? you are overwhelmed and a prayer thanking God for your current state escapes your lips. You also know that the situation can be changed if the kid has enough educational resources. You swear at the country growing at 9%( and you are growing @20% p.a) and investing only 3% in education. You make a note to call your regular NGO ( because your firm makes many donations to it (Sec80G you see!) and make a small contribution. You reach home , India loses and you forget the world……. Entrepreneurs changed the Indi...

Small is Beautiful and Powerful too : “No coincidence should be dismissed as coincidence until it is proved that it is a coincidence”- Miss Marple Sometimes small and seemingly inconsequential things have a significant effect on the fiber of the time and society. For example the literacy rate went up from 1981 to 1991 census in India , sample this:literacy Total population 1981 1991 %change Persons 659.3 816.2 23.8 Males 340.8 423.6 24.3 Females 318.5 392.6 23.3 Population aged 7+ Persons Total 536.2 670.1 25.0 Literates 234.1 349.7 49.4 Illiterates 302.1 320.4 6.1 Males Total ...

Reductio ad absurdum ( proof by contradiction ) corporate finance is a funny field to do summers in ! and for those engineers and science guys it is like jumping through the rabbit hole into a wonder land of numbers. It is a land of numbers and numbers rule there and like the Queen of Hearts they overwhelm you by the sheer absurdity in their logic…. But like the queen the numbers get their whims fulfilled .. their power is too overwhelming to resist… and once you look at a credit proposal you cannot help but feel their hypnotic power…. You forsake your thinking and become a believer.. Imagine a company that has a gross profit of 10crores and a net profit of ( 10cr) on their P&L . They are on the mercy of their working capital lenders to issue BGs ( bank guarantees) and open LCs( letter of credit) for them to enable them purchase raw materials ( imported or inland ). And if such a company has contingent liabilities of 100cr you are shocked. And of the 100cr there are CGs ( corporat...