Bankers predicting football

So the Football World Cup season is upon us, and this means that investment banking analysts are again engaging in the pointless exercise of trying to predict who will win the World Cup. And the funny thing this time is that thanks to MiFiD 2 regulations, which prevent banking analysts from giving out reports for free, these reports aren’t in the public domain.

That means we’ve to rely on media reports of these reports, or on people tweeting insights from them. For example, the New York Times has summarised the banks’ predictions on the winner. And this scatter plot from Goldman Sachs will go straight into my next presentation on spurious correlations:

Different banks have taken different approaches to predict who will win the tournament. UBS has still gone for a classic Monte Carlo simulation  approach, but Goldman Sachs has gone one ahead and used “four different methods in artificial intelligence” to predict (for the third consecutive time) that Brazil will win the tournament.

In fact, Goldman also uses a Monte Carlo simulation, as Business Insider reports.

The firm used machine learning to run 200,000 models, mining data on team and individual player attributes, to help forecast specific match scores. Goldman then simulated 1 million possible variations of the tournament in order to calculate the probability of advancement for each squad.

But an insider in Goldman with access to the report tells me that they don’t use the phrase itself in the report. Maybe it’s a suggestion that “data scientists” have taken over the investment research division at the expense of quants.

I’m also surprised with the reporting on Goldman’s predictions. Everyone simply reports that “Goldman predicts that Brazil will win”, but surely (based on the model they’ve used), that prediction has been made with a certain probability? A better way of reporting would’ve been to say “Goldman predicts Brazil most likely to win, with X% probability” (and the bank’s bets desk in the UK could have placed some money on it).

ING went rather simple with their forecasts – simply took players’ transfer values, and summed them up by teams, and concluded that Spain is most likely to win because their squad is the “most valued”. Now, I have two major questions about this approach – firstly, it ignores the “correlation term” (remember the famous England conundrum of the noughties of fitting  Gerrard and Lampard into the same eleven?), and assumes a set of strong players is a strong team. Secondly, have they accounted for inflation? And if so, how have they accounted for inflation? Player valuation (about which I have a chapter in my book) has simply gone through the roof in the last year, with Mo Salah at £35 million being considered a “bargain buy”.

Nomura also seems to have taken a similar approach, though they have in some ways accounted for the correlation term by including “team momentum” as a factor!

Anyway, I look forward to the football! That it is live on BBC and ITV means I get to watch the tournament from the comfort of my home (a luxury in England!). Also being in England means all matches are at a sane time, so I can watch more of this World Cup than the last one.


A journey back to civilisation

Earlier this evening, I was at a coffee shop in Whitefield with a friend when it started raining cats and dogs. I got a message from a wife stating that it was raining insanely in her part of town, and that I should be careful while coming back. I promised her that I would wait it out before returning, and returned to my conversation.

I made my first attempt at booking a cab at 1845, by which time the rain had stopped. Uber showed that the nearest cab was 8 minutes away, except that when I tried to book it it failed to find me a ride. Ola was no better – except that it showed that the nearest cab was 20 minutes away when I opened the app.

I continued waiting, and continued checking on both platforms. No cabs materialised. And after some 45 minutes of waiting thus, I decided to get out and find a bus. My friend was surprised that I was willing to change buses to get home. “I would never do that”, he declared, adding that it would be easier for me to move back to India.

I walked up Varthur main road looking for a bus stop. It had stopped raining but there were huge puddles on the roadside, and mosquitoes buzzed all around. There was a huge crowd at the bus stop. The first two buses came at an interval of five minutes each. Both were jam packed.

It was clear that Varthur main road wasn’t a great place to be, since the bus frequency there was low – most buses would be coming from the other side of Whitefield, so it was clear that I should get to Kundalahalli gate.

Presently an “illegal bus” (an office bus picking up passengers for some extra income for the driver) materialised, and it was a good opportunity to get to Kundalahalli gate. The bus sped there, and charged 10 bucks.

As expected, there were plenty of buses, including Volvos, at Kundalahalli Gate, except that there was no room to get into any of them. Once again, there was no luck to be had on the Uber or Ola front. I even tried UberPool and Ola Share (stuff I normally never use), but nothing materialised. The only result of all that was that my phone battery drained like crazy. And it started raining as well – I was happy I had behaved like a rich man this morning and bought a new umbrella when I realised I’d forgotten mine at home.

An airport bus appeared as a sort of a saviour. It was empty, and the conductor said passengers not headed to the airport weren’t allowed on it. I offered to buy a ticket till the airport, and was allowed on. The conductor said I best get off at the next stop (Marathahalli bridge) given where I was headed. He charged me Rs. 16.

So at every step I got closer and closer to civilisation. Kundalahalli Gate was civilisation compared to Varthur Main Road. Marathahalli was civilisation compared to Kundalahalli Gate. Another illegal bus there dropped me to Domlur (Rs. 20), and under normal circumstances that should count as “proper civilisation”. Except that the design of the Domlur flyover means that it’s rather desolate and dark and unwalkable under it. So I needed to reach the next stage of civilisation, which I did when yet another illegal bus dropped me to Richmond Circle (the driver demanded Rs. 15, but I gave only Rs. 10 since I didn’t have change).

At all stages, I continuously tried to get cabs and autos, but perhaps due to tomorrow’s state elections, none materialised. Most of the time I was on one road (Old Airport Road), and most sections of it are rather badly lit and seem unsafe and “rural”. This was a journey I would have never done if I had been with family.

And the mode of transport was bimodal – three of the five buses I took to reach home were “illegal”. Two others were the most expensive Volvos. The last leg of the journey was completed on yet another airport Volvo, where the conductor made no fuss of letting people in, and not only gave me change for Rs. 100 (ticket cost Rs. 37), but also gave me 5 100 rupee notes for a 500 rupee note I handed him.

The entire journey, from the time I started hailing the cab to when I opened my door, took exactly three hours. A cab would have cost me upwards of Rs. 500, but my bimodal transport cost me Rs. 105. Frankly I would’ve been more than happy to spend the former amount for the pleasure of getting home an hour and half earlier, and being able to do something productive on the ride home.

But then it’s not often that an NRI has an adventure such as this!

NRI Diaries: Volume 2, Number 2

I’m writing this while chomping on a bar of Amul Colombia Classique Black Single Origin Dark Chocolate. You read that right. Amul now produces single origin dark chocolate (55%) using chocolate from Colombia, Ecuador and Venezuela (!!!).

It was only six months back that I first came across the concept of single origin dark chocolate, when a (then) colleague in London offered me some Haitian dark chocolate he had bought at Waitrose. I had been bloody impressed, and fallen in love with this brand of chocolate then, but now I’m reminded of what my father used to say – that there’s nothing that is not available in Bangalore “nowadays” (to put that “nowadays” in context, he died in 2007).

The said bar of chocolate was purchased at Namdhari Fresh, which I visited with the express purpose of checking out what exotic foods are available in Bangalore nowadays (and Namdhari is hardly the place where you get the most exotic stuff in Bangalore nowadays – it just happens to be within walking distance of my house).

And now I see that several kinds of cheeses are available here – apart from the “usual” Cheddar and Mozzarella, you get Feta and Halloumi as well. Well, Feta we used to get back in 2016 as well, though not always (which prompted an entire chapter in my book), but this is the first time I’m finding Halloumi in Bangalore. It’s expensive, though – INR 640 for a 150 gram block (if I remember correctly). To compare, a 250 gram block of Halloumi costs GBP 2.25 (~INR 200) in London.

On my long walk to “flowth block” today, I felt like an NRI. I felt like someone who’s visiting India from abroad, and who is very impressed with the “energy” and growth. A couple of my old favourite restaurants had shut down, I saw (La Casa and Gramina Thindi, for those who want to know), but there were also loads (and loads) of small cutesy places that had opened up. There is plenty of construction activity, and plenty of investment in the city. Some of the investment will surely go under, but a lot of it will produce outsized returns. In a way, compared to when I left last year, based on very tiny anec-data, it seems like risk-taking ability of people in Jayanagar has gone up.

Another piece of evidence of the vibrancy of India is in the mobile internet space – I was telling a friend I met today that before I moved last year, I had a package that provided me with 3GB of data per month. The pay as you go plan that I use now offers me 2GB of data PER DAY! And I pay a fifth of what I used to pay in 2016.

And this has set off another wave of entrepreneurship, since this has resulted in a massive spike in the amount of video consumption (the friend I was talking to today quoted some impressive numbers in terms of this growth).

Earlier in the day, I took my wife’s old scooter to move all round town for a series of meetings. Based on anec-data (once again), traffic actually seems to have better, at least in parts of old Bangalore that are now served by the metro.

I might have a different opinion of Bangalore’s traffic tomorrow, though, since I’m headed to Whitefield (not taking the scooter there, though).

The Government Should Regulate Cooks

I wrote this for Pragati Express. Reposting it here since my general readers might find it interesting as well. This follows from my old blog post that bathrooms should be banned

Yet another wedding, yet another truckload of wasted food. If, in reality TV show style, we were to try to identify the “root cause” in this instance, it was the cook (or the team of cooks, rather). Each of the seven respondents this correspondent surveyed expressed their displeasure at the quality of the food. One even called it her “worst ever Indian wedding dinner”.

This wedding was only one isolated instance – it is all too common an occurrence in these parts for copious amounts of food to be wasted all because of a cook who ended up cooking badly. And it is all the fault of the cooks, most of whom have never gone to culinary school (we don’t have too many of those in India), and many of whom haven’t gone to school either.

When thousands of people in India die of hunger everyday, and farmers continue to kill themselves in Vidarbha(and elsewhere), this wastage of food is indeed criminal. It comes at a high human cost. And that it comes out of sheer incompetence of unregulated cooks makes it indeed tragic.

There is only one solution to this – the government should regulate cooks. Not just wedding cooks – since wastage of food at weddings and other parties are only part of the problem – the government should regulate anyone who wants to cook. The other day my daughter refused to eat an idli. We decided to salvage our karma by feeding it (the idli) to the neighbourhood street dog, who took one bite and promptly ran away.

Whether you want to make yourself a 2-minute Maggi, or Shantavva in Santemarahalli wants to make a ragi ball, or chef Madhu Menon (hope he doesn’t edit this bit out) wants to make bloggers’ b***, you should need a licence from the government, which certifies that you are a cook of a high enough quality that what you cook will not go waste.

That’s the only way we can save millions of our population from hunger. There is already enough wastage of food because farmers cannot coordinate on what to grow, and because of inefficiencies in the food supply chain, and because of the way agricultural markets are regulated. We don’t want badly cooked food to add to the wastage. And the only way to ensure that is by having the government regulate cooks.

PS: As Ravikiran Rao, a former editor of the former avatar of this publication, likes to put it, “#thatzwhy we need strong regulation

PS2: Some readers might be advised to consume irony supplements along with this article

NRI Diaries: Volume 2, Number 1

We were welcomed with the mildly warm mildly humid air of Bangalore as we walked out of the airport early this morning. It was that nice kind of humidity, that makes you feel good without breaking a sweat.

The exit from the airport had been rather smooth, except for a bit of a wait at the baggage carousel. Passport control, which had taken 30 mins during our December visit, took 3. No questions asked anywhere.

The airport taxis seemed rather disorganised, though, with random (non-licensed) taxis standing in the same rank as the licenced taxis, and drivers shouting to attract customers. This is a departure from the usual practice at Bangalore airport where the taxi rank is rather well organised!

First order of business after landing at the in-laws’ house in Rajajinagar was to go for breakfast, which was at CTR. The driver of the first auto rickshaw we sat in insisted on filling up gas before he dropped us. So we jumped out and let him have his gas instead.

The vaDe at CTR was average. The masaldose was good but not great. Based on recent samples, I’m once again in the Vidyarthi Bhavan camp in the great north-south dose battle. The dose there during my last visit in December had been brilliant. I’m going there again next week.

I had a work meeting in the afternoon. Over the last year or so in London I’ve consistently eschewed the big chains in favour of the numerous independent hipster cafes the city is littered with. Suddenly, here I was at a loss in terms of meeting venues – not finding anything beyond the chains in the area of town I’d to go to. I finally picked Coffee Day Square at the Tiffany’s junction, and I wasn’t disappointed.

Then, for the first time this season, I’m getting to watch the IPL live. Living in the UK, where cable TV subscriptions are not a thing, I’ve hardly watched live sport. I occasionally buy day passes on Sky TV to watch football, but taking a specific subscription just to watch IPL doesn’t seem worth it.

And as it happens, my in-laws have only once channel that shows live IPL – Star Suvarna Plus, with the channel’s specialty being Kannada commentary! While it’s pleasant to hear fresh voices describe the cricket, somehow it feels weird listening to Vijay Bharadwaj and B Akhil talk about the game. And I didn’t feel this way when listening to Kannada commentary of Ranji trophy matches on radio in the early 1990s. As I write this, I’m watching on mute.

Oh, and I’m still yet to adjust to the time zone change. At 3:30 this afternoon I was wondering why the IPL game hadn’t yet begun, and while writing this at 8:30 I’m wondering why the Guardian hasn’t started its MBM on the Atletico-Arsenal game yet!

Finally maybe it’s because it was a shorter gap between India visits this time (4 months), but I feel less like an NRI. I’m not too fazed by the heat, and most of the day has felt “rather normal”. Maybe I’m getting used to being an NRI!

More on interactive graphics

So for a while now I’ve been building this cricket visualisation thingy. Basically it’s what I think is a pseudo-innovative way of describing a cricket match, by showing how the game ebbs and flows, and marking off the key events.

Here’s a sample, from the ongoing game between Chennai Super Kings and Kolkata Knight Riders.

As you might appreciate, this is a bit cluttered. One “brilliant” idea I had to declutter this was to create an interactive version, using Plotly and D3.js. It’s the same graphic, but instead of all those annotations appearing, they’ll appear when you hover on those boxes (the boxes are still there). Also, when you hover over the line you can see the score and what happened on that ball.

When I came up with this version two weeks back, I sent it to a few friends. Nobody responded. I checked back with them a few days later. Nobody had seen it. They’d all opened it on their mobile devices, and interactive graphics are ill-defined for mobile!

Because on mobile there’s no concept of “hover”. Even “click” is badly defined because fingers are much fatter than mouse pointers.

And nowadays everyone uses mobile – even in corporate settings. People who spend most time in meetings only have access to their phones while in there, and consume all their information through that.

Yet, you have visualisation “experts” who insist on the joys of tools such as Tableau, or other things that produce nice-looking interactive graphics. People go ga-ga over motion charts (they’re slightly better in that they can communicate more without input from the user).

In my opinion, the lack of use on mobile is the last nail in the coffin of interactive graphics. It is not like they didn’t have their problems already – the biggest problem for me is that it takes too much effort on the part of the user to understand the message that is being sent out. Interactive graphics are also harder to do well, since the users might use them in ways not intended – hovering and clicking on the “wrong” places, making it harder to communicate the message you want to communicate.

As a visualiser, one thing I’m particular about is being in control of the message. As a rule, a good visualisation contains one overarching message, and a good visualisation is one in which the user gets the message as soon as she sees the chart. And in an interactive chart which the user has to control, there is no way for the designer to control the message!

Hopefully this difficulty with seeing interactive charts on mobile will mean that my clients will start demanding them less (at least that’s the direction in which I’ve been educating them all along!). “Controlling the narrative” and “too much work for consumer” might seem like esoteric problems with something, but “can’t be consumed on mobile” is surely a winning argument!



Relative pricing revisited

Yesterday I bought a pair of jeans. Normally it wouldn’t be a spectacular event (though one of my first blogposts was about a pair of jeans), but regular squatting has meant that I’ve been tearing through jeans well-at-a-faster-rate, and also that it’s been hard to find jeans that fit me well.

Basically, I have a well-above-average thigh and a well-below-average arse for my waist size, and that makes it hard to find readymade pants that fit well. As a consequence I’ve hardly bought trousers in the last 2-3 years, though I’ve been losing many pairs to the tear in this period of time.

And so when I found a pair of jeans that fit me comfortably yesterday I wasn’t too concerned about paying a record price for it (about 1.8 times the maximum I’d ever paid for a pair in the past). In fact, I’d seen another pair that fit well a few minutes earlier (and it was a much fancier brand), but it was well above budget (3 times as expensive as my historically costliest ever pair), and so I moved on (more importantly, it came with a button fly, and I’d find that rather inconvenient).

Jeans having been bought, we went off to a restaurant at the mall for lunch, at the end of which the wife pointed out that the money we paid for the lunch was more than the difference in prices between the two pairs of jeans. And that if only we would avoid eating out when it’s avoidable, we could spend on getting ourselves much more fancier clothes without feeling guilty.

I’ve written about relative prices in the past, especially about the Big Mac Index, and how it doesn’t make sense because of differential liquidity. After moving to London, I’m yet to come to terms with the fact that relative prices of goods here is vastly different from that back home; and that I haven’t adjusted my lifestyle accordingly leading to inefficient spending and a possible strain on lifestyle.

Food, for example, is much more expensive here than in India (we’ll use official exchange rates for the purpose of this post). The average coffee costs £2.5 (INR 225), which is about 10 times the price of an average coffee in Bangalore (I’m talking about a good quick cup of coffee here, so ignoring the chains which are basically table rentals). The average weekday takeaway lunch costs £6 (INR 540), which is again 10X what it costs in Bangalore.

Semi-fancy meals (a leisurely meal at a sit down restaurant with a drink, perhaps) are relatively less costly here, costing about £25-30 per head compared to INR 1200-1500 in Bangalore, a ratio of about 2X. A beer at a pub costs about the same, though cocktails here are much more expensive.

The alternative to eating out is, of course, eating in, and most “regular” ingredients such as vegetables and rice cost more here, though cheeses (which are relatively less liquid in India) are actually cheaper here. Milk costs about the same.

Controlling for quality, clothes cost about the same (or might even be less costly here when you go for slightly more fancy stuff). Electronics again cost about the same (they come through the same global supply chain). Contact lenses are more expensive here (though the ones I buy in India are manufactured in the UK!).

In my book, I have a chapter called “if you want to live like a Roman, live in Rome”. It’s about how different cities have different relative liquidity of goods. Similarly, different cities and countries have different relative prices, and long-term residents of these places evolve their spending to optimise for their given set of relative prices.

And when you move cities or countries, if you don’t change your lifestyle accordingly you might end up spending suboptimally, and get less welfare from life.

Once again this points out problems with international price indices being constructed based on a particular commodity, or set of commodities. For not only are different commodities differentially liquid (as I pointed out in my Mint piece linked above) in different places, but also the “standard consumption basket” also varies from city to city!

And if a Delhi-ite consumes lots of apples, and a Bangalorean consumes lots of oranges, you can’t make an apples-to-apples comparison in cost of living in these cities!