When will my courier reach?

Earlier today, I had to urgently send a package to Mumbai. I was recommended that I use Bleudart since they guarantee next day delivery, and off I went to the Bluedart collection centre near my house. There, I learnt that there were 3 options.

For two hundred and eighty rupees (what I ultimately picked) I was guaranteed that the package would be delivered tomorrow. However, there were two premium offerings – promising 1030 am delivery, and 12 noon delivery. Given my payoffs I settled for the “normal” next day package. Now, I wonder when my package will reach.

What are the odds that the package would reach before noon? I would say the odds are very slim, for if my “normal” package were to reach before noon, there would be no reason for me in the future for me to pick the 1030 delivery or 12 delivery package. Even if the package would have reached close to the destination tomorrow morning (I expect that it’ll be sent on a late evening flight today or early morning flight tomorrow), the delivery person would be instructed to wait till after noon before delivering, I think.

What do you think? If you think it’ll reach before noon, you can bet on it. Leave a comment and we can discuss odds. I’ll give you the airwaybill number so we know when exactly it got delivered.


I win the non-existent bet.

Pickup Date 12 October 2011
From Bangalore
To Mumbai
Date of Delivery 13 October 2011
Time of Delivery 12:15

Intellectual Property

A blog post earlier this month on Econlog finished off with a very strong quote by Friedrich Hayek:

One of the forms of private property that people cherish most is their ideas. If you convince them that their ideas are wrong, you have caused them to suffer a capital loss.

I ended up liking it so much that I added it to my work email signature. Thinking about it further, why is it that some people are more open to debate than others? Why do some people admit to their mistakes easily while others are dogmatic about them? Why do some people simply refuse to discuss their ideas with other people? I think Hayek’s observation offers a clue.

Let us consider two people – Mr. Brown and Mr. Green. Mr. Brown believes in diversification, and his investments are spread across several financial instruments, belonging to different categories, with a relatively small amount of money in each of them. For purposes of this analogy, let us assume that no two instruments in his portfolio are strongly correlated with each other (what is strong correlation? I don’t know. I can’t put a number on it. But I suppose you get the drift)

Mr. Green on the other hand has chosen a few instruments and has put a large amount of money on each of them. It is just to do with his investment philosophy, which we shall not go into, as this is just an analogy.

Let us suppose that both Mr. Brown and Mr. Green held Satyam stock on 6th January 2009. They were both invested in Satyam according to their respective philosophies – and the weightage of Satyam in their respective portfolios was also in line with their philosophies. The next day, 7th of January, the Satyam fraud came out. The stock crashed to a tenth of its value. Almost went to zero. How would our friends react to this situation?

Mr. Green obviously doesn’t like it. A large part of his investments has been wiped out. He has become a significantly poorer man. For a while he will be in denial about this. He will refuse to accept that such a thing could happen to one of his chosen stocks. He will try to convince himself that this fall (a 90% fall, no less) is transient, and the stock will go back to where it once was. As days go by, he realizes that his investments have been lost for ever. He is significantly poorer.

Mr. Brown will also be disappointed by the fall – after all, he too has lost money in the fall. However, his disappointment is mitigated by the fact that the loss is small compared to his portfolio. There have been other stocks in his portfolio which have been doing well, and their performance will probably absorb the Satyam losses. Some of the stocks in his portfolio may also be fundamentally negatively correlated with Satyam, which means they will now gain. There is also the possibility that the Satyam fall has opened up some new possible areas of investment for Mr. Brown, and he might put money into them. It is much easier for Mr. Brown to accept the fall of Satyam compared to Mr. Green.

So you replace stocks by ideas, and I suppose you konw what I am gettting at. The degree of openness that people show with respect to an idea they have varies inversely with the share of this particular idea in their “idea portfolio”. The smaller the proportion of this idea, the lesser will be the “capital cost” of their losing the idea. And hence, they will be more open to debate, to discussion, to letting someone critically examine their ideas. If the proportion of this particular idea in their overall portfolio is large, there will obviously be resistancce.

A corrolary of this is that when someone possesses a small number of ideas they are more likely to be dogmatic about them (I am using the indefinitive “more likely” here because even when you have a small number of securities in your portfolio, your exposure to some of them will be really small and so you’ll be less unwilling to lose them. Though I must point out that people with small ideas portfolios become so used to madly defending the big ideas in the portfolio that they start adopting the same tactic for the smaller ideas in their portfolio and become dogmatic about them – which is irrational).

I just hope I didn’t cause you a capital loss by writing this. For me, on the other hand, this was a bonus stock.

Why is Ten Sports sitting on so many rights?

I wanted to stay up last night. I wanted to stay up and watch the WI-Eng match till the very end. Waking up this morning and checking the scorecard, it seems like it was a really good match. And Fidel Edwards seems to have become a last-day-shutdown specialist. This is the second time this series he’s hung on. And he’d done so once before against India at ARG.

There was another reason I wanted to stay up last night. I wanted to watch Liverpool play Real Madrid. I woke up this morning and saw that it was an amazing game, too. Looking through the Guardian Football site (btw, Advani seems to be advertising heavily on that site; it’s a pity he never advertises here on my site) I noticed that Chelski-Juve was also a strong game, despite the result. Another reason I would’ve wanted to stay up last night. For the record, I slept at 12:10. Tea-time in the Test match, and before either of the football games had started.

Ten Sports seems to have bitten off more than it can chew. It seems to own the rights to telecast too many different things. I think I have raised this point once earlier, but it pzzles me as to what Ten Sports is trying to achieve by getting rights to telecast so many things, most of which are happening at the same time. For example, over the last couple of weeks I’ve been unable to watch the first hour of WI-Eng even if I’d wanted to, because it was overlapping with the last hour of SA-Aus, which was being telecast at the same time.

The reason I slept off early last night was because I didn’t have the option to watch what I wanted. All the three games that I’d’ve been reasonably interested in were supposed to be on Ten Sports (Zee Sports doesn’t count since Tata Sky doesn’t offer that), and I  realized that I’d be forced to watch what the guys at the Taj Entertainment Network would want me to watch. Denied the option to choose what I wanted to watch, I went to bed.

It puzzles me that Ten Sports isn’t subletting its contracts. Devoid of anything decent to show, I suppose that ESPN or NEO would’ve only been too happy to acquire the rights to telecast last night’s Liv-Real game by paying a fee to Ten Sports. And it would’ve unlocked value at the hands of the remote-holder. Ten Sports need not let go of the rights to show all the games. All they need to do is to sell the “out of money options” – the rights to the game which they won’t be able to telecast anyway.

Now, the problem will be if accounting for all costs, no options are out of money. For example, you know you won’t be able to show Liv-Real. But you think that the loss of brand equity of your channel would exceed the money you’d gain by selling this option to another willing channel. The viewers are the only losers at this game, but I don’t know what can be done. After all, viewers  are way too dispersed in order for them to take any kind of action.

Extending this question, what can a sports body do to prevent a bidder from acquiring rights to telecast and then mess up the telecast (or not telecast it at all) ? After all, the sports body is out there to make as much money as possible from the TV rights, and they need to ensure significant investment into broadcasting by the broadcasters, so the “i’ll give rights to only those channels that are in the interest of the people” model won’t work.

One option would be to sell the rights to two channels in each market. But given that broadcast is a natural monopoly, the sports body will not be able to make as much by selling to two bidders as it can by selling to one bidder. Is there any other solution that you can think of? If yes, unleash.


I’m trying to understand the significance of attending another person’s wedding. It is very unlikely that you are going to add any significant value to the process, since the person who invited you is likely to be extremely busy with the process. Unless you know one of the main people involved in the wedding really well, there is a finite probability that your attendance might not be noted also (just in case the photographer is not diligent enough).

Of course, weddings give you the opportunity to network. Especially if it is a noisy south indian setting (I’ve attended one north indian wedding so far, and what put me off was the requirement to stay silent during the proceedings) or a reception. It is a good excuse for you to catch up with all those people who belonged to the same affiliation group as you and the person who invited you. It is a good opportunity to expand your social circle.

Back in the 1980s, when I was a kid, one of the great attractions of weddings was the food. Bisibelebath was a special item back then, as were the various “wedding special” sweets. Some of the more affluent folk would also offer ice cream for dessert (that has become a common thing now, especially for receptions). The food on its own was enough to make me look forward to weddings. Over time, the general quality of wedding food has dropped. And the general quality of food in restaurants has increased well at a faster rate. So you don’t need to go to a wedding for the food anymore.

Historically, I’ve been fairly social. I’ve usually attended all functions that I’ve been invited to, especially if it’s in the same city. I admit I haven’t really travelled too many times to attend weddings but done short trips (such as Bangalore-Mysore) occasionally. I’ve always calculated that the cost (time, travel, etc.) of attending a wedding is not much in terms of potential benefits in terms of networking, catching up, expanding circle, etc. Of course, I need to admit that over the last couple of years, NED has been part of the equation, and there have been a few occasions when I’ve worn a nice shirt and then backed off from going.

It is all fine when travel is local, where NED is perhaps the only thing that can tilt the balance in favour of not attending the wedding. When you live away, the whole equation changes. The cost of travelling goes up dramatically (in terms of time, money and inconvenience). The climb is especially steep if you live a flight away, rather than just a train journey away. What used to be borderline cases when the distance was small now dussenly become absolute noes. The obvious ayes become borderline cases. And in some cases obvious ayes become obvious noes. It is only when a wedding happens in your new city that what were obvious noes become obvious ayes.

Four months ago, my cousin (father’s brother’s daughter) got married in Bangalore. If I were in Bangalore, it would have been an emphatic aye. In fact, it’s likely that I’d’ve volunteered to take up a significant number of duties at that wedding. However, the way things turned out (my being in Gurgaon), it wasn’t tough to declare that as a noe. The work that I would’ve otherwise volunteered for suddenly became “work”, became a “cost”. Combined with a couple of other factors, it turned out to be a fairly obvious noe. And I don’t think anyone really minded.

It seems to be the season for friends to get married, especially juniors from IIMB. Two of them who have just got married to each other are having their reception tonight 100m away from my Bangalore house. A case that would have been an overwhelming yes, now become borderline. Remember that NED to travel varies with the travel-cost in a super-linear fashion, and I think it is that which has turned today’s case into a no. There have already been a few other weddings in the season for which I’ve convinced myself with a similar reason. And there are more.

So I ask myself once again – why should I attend someone’s wedding? I have so far been putting the obvious variables into my calculation – netwroking opportunity, goodwill, opportunity to catch up with people, side effects (a wedding in Bangalore is a good excuse for me to visit Bangalore, etc.), travel costs, chance of occurrence of NED, how much ‘work’ it will be, etc. and have been trying to base my decision on these.

Is there something I’ve missed out? Is there something else that I need to consider which might change the costs and benefits of going? Coming back to the more fundamental  question, why should I attend someone’s wedding?


A couple of days back, I was debugging some code. And yes, for those of you who didn’t know, coding is a part of my job. I used to have this theory that whatever job you take, there is some part of it that is going to be boring. Or to put it in the immortal words of a brilliant co-intern at JP Morgan “chootiya kaam”. And in my job, the chootiya part of the kaam is coding. That doesn’t mean that I’m not enjoying it, though. In fact, for the first time in nine years (note that this takes me to a time before I’d started my BTech in Computer Science) I’m enjoying coding.

Coming back, I was debugging my code yesterday. It was one of those impossible bugs. One of those cases where you had no clue why things were going wrong. So I started off by looking at the log files. All clean, and no bugs located. While I was going through them, I got this idea that the strategy sheet might offer some clue as to why things aren’t doing well. Half the problem got diagnosed when I was looking at the strategy sheet. Some problem with cash management.

And when I thought looking at the trades might help. The bug was presently discovered. And then it hit me – that I’d unwittingly followed what seems like a “process”. Everything that I did had been guided by insight and instinct. Yet, the steps that I followed – 1. look at the logs; 2. look at the strategy sheet ; 3. look at the trades – seemed so much a preset process. It seemed to be like one of those things that I’d just ended up reading in some manual and following.

I realize that most “standard processes” that are followed by  various people in various places are stuff that were initially not meant to be processes. They were just an imprint of somone’s train of insights. It was as if someone had a series of insights that led to a solution to whta might have been a difficult problem. And then, he realized that this kind of a process could be followed to deal with all such similar problems. And so he wrote down the process in a book and taught a set of people to implement them. The field thus got “fighterized“.

The argument I’m trying to make here is that a large number of so-called “standard processes” are just an imprint of someone’s insight. They just happened to get into place because the inventor noticed this pattern in a bunch of things that he was doing. They need not be the best way of doing what is supposed to be done. Maybe there isn’t even a single best way of doing it that might work every time.

People who are likely to have worked on processes later in their life cycle are likely to have been people who are process-oriented themselves, and given how these kind of people work, it would have been likely that they would have resisted changes that could make the process worse in the short term. They are more likely to have been incremental in their approach. With a succession of such people working on improving the process, the process of refining the process would’ve ended up taking a hill-climbing algorithm and is likely to have ended up in a local maximum.

Once again, the large changes to the process would’ve happened when someone who was willing to take a large step backward worked on them, and it is again likely that such a person would be driven more by insight rather than by process.

My hypothesis is that most processes are likely to have been largely defined by people who are themselves not very process-oriented, and who thus will expect a certain level of insight and discretion on the part of the person implementing the process. And one needs to keep this in mind while following processes. That it would be good if one were to take a critical view of every process being used, and not be afraid to take a backward step or two in process development in order to achieve large-scale improvements.

Year Ending Post

Last december 31, I wrote a this day that year post. Two years back, I had published a short story. The year before, I had written about the events of the day, and one year prior I was mugging for what was going to be a disastrous marketing exam. As I am writing this, I’m playing scrabble on facebook, and bridge with my computer. I’m listening to music, and am planning to hit the sack soon.

This afternoon I received a mail from my boss, which he said is a standard format mail he sends to friends and colleagues. It was full of pictures of him and his wife and his kids, and stories about what they did this year. About the changes and special events in each of their lives. About how the year has been from different perspectives. And so forth. I think I have received a couple of other similar mails (from US based people – this might be some american funda; my boss also lived in America till early this year) from other acquaintances (though, without pics) which I haven’t bothered to read. Since I’m clueless about what to write, I think I’ll just do a standard year-end roundup.

The most significant thing for me was my move to Gurgaon, and to this new job. That had been preceded by four months of joblessness, and more than two years of acute NED (in fact, I think it was during this period of extended NED that I actually invented the term NED).

The concept of NED also seemed to advance by leaps and bounds this year. I have heard of people who are at least three degrees away from me use it. The message of this concept seems to be spreading. I am sure that one day it will be famous, but then I’m not sure if I, as its inventor/discoverer, will get due credit.

Another significant event of the year has been the movement of this blog from livejournal to its present location. I must mention that this website has been like “glad bangles” for me. A week after I inaugurated this, I had a nice job offer, ending over a year of NED. There were a few other changes also in my life around that time, which I don’t remember now. What I do remember was classifying this website as “glad bangles”. and I like this better than Mad Angles.

On the louvvu front, it was a very quiet year, apart from one quick episode. Maybe one of the least productive years – comparable, maybe, to my years back in IIT.

Ok I think NED is happening. i just resigned my scrabble game. I had resigned my bridge game ages back, and I’d closed the program. I’m feeling sleepy now. So I’ll close it here. Happy new year. And I think this is the worst year-ending post that I’ve written in a long time. This website maybe deserved a much better new year post in the year end but it’s ok.

What rate of interest did Kubera charge?

It is fairly well established that Tirupati Venkataramana (it is Venkataramana and not Venkateshwara – remember that it is a Vaishnavite temple) took a loan from Kubera in order to finance his wedding to Padmavati. And till date, Venkatarmana has been soliciting contributions from visitors to his shrine in order to help him pay off this loan. Given that the loan was for the purpose of getting married, I think we can quickly establish that it was a Personal Loan. What I’m trying to figure out, however, is what rate of interst did Kubera charge Venkataramana.

For starters, I think somewhere in our scriptures, we can find out the amount that Venkataramana borrowed. Rupees didn’t exist in that era, but I’m sure we can find some figures in terms of gold, or other commodities. And we should be able to estimate the rupee value of this loan by suitable backward extrapolation.

What might be slightly tougher is the time period. When did Kubera exist? When did Venkataramana exist? When did he get married to Padmavati? The date is important, for we should know how many years to discount for when we do the IRR calculations. However, I’m sure that with sufficient effort, we should be able to find the date of this particular transaction to the nearest millenium.

Then, there are the loan repayments. Let us assume that Venkataramana is in general a poor man, and his repayments can be approximated to the amount of offerings he receives from visitors to his shrine. Catch a few people sitting for McKinsey interviews, and estimating this amount is also not going to be very tough. We should be able to get fairly accurate figures for the last few years, and then we should be able to appropriately extrapolate backwards accounting for various regime changes (I’m assuming here that the temple, for whatever reason, will refuse to cooperate in this noble endeavour – else we can get the repayment amounts from the temple books).

We also need to remember that the repayment is not complete. People still contribute generously to the Venkataramana Personal Loan Repayment Fund. However, if we assume that the loan has already been repaid, we can get a floor on the rate of interest that Kubera charged. It is intuitive right – that if more money pours in, the interest rate would’ve been higher? Let us also assume that there were no repayments till about five hundred years ago, which was approximately when the temple was built. Assuming zero repayments till then, it again gives a floor on the interest rate.

Obviously, I don’t already have any of the data that I’ve mentioned here, so I can’t actually do the calculations. However, if McKinsey decides to solve this problem, they can do so in March during their interviews at IIMs. My prediction, however, is that the rate of interest will come out to be a number which, in normal circumstances, would be found to be usurious. Thus, we might probably be able to show that people are contributing to funding a greedy usurious rich moneylender when they contribute to the Venkataramana Personal Loan Repayment Fund. I don’t know what further use this might be put to, but I think the process will be an end in itself.

On a closing note, I would like to point out the greatness of our culture – which, even in mythological times, could boast of complicated financial products such as Personal Loans. This one factor, I think, is enough to show that our Indian culture is superior to all other cultures.

PS:  Sometime back, I was wondering if the Venkataramana Personal Loan Repayment Fund could be the largest money-laundering operation in India. However, a little thinking revealed that our political parties are definitely far far ahead when it comes to that.