Of Pepsi and Perk

Can be best described by looking at the “objects” that defined our bets at different points in time. Most of those  phases seem to have faded away, but I clearly remember two of them – the Pepsi phase and the Perk phase.

The Pepsi era started with their “nothing official about it” campaign during the 1996 World Cup. It was a brilliant campaign, and had all of us 13yearolds hooked. This became our excuse for any little crimes we would commit (like i would hit someone and say “nothing official about it”). I’m not sure if we used it as an excuse for larger crimes, but I suppose we would’ve used it quite regularly as an apology.

Pepsi seemed to have done a good job of identifying itself with this slogan, as soon Pepsi too became our “weapon of choice” when it came to settling bets, and suchlike. This was the period of time when a tiny bottle of Pepsi had just become affordable by saving up on pocket money, and it was put to good use. The unofficial inter-class cricket tournament became “the pepsi cup” – the losing team was supposed to sponsor a bottle of pepsi for each member of the winning team. If my memory serves me right (it usually does), the tournament never got completed.

This phase lasted for almost all of my 9th standard, if I remember right. Maybe it was briefly replaced by other phases, but this was the defining brand of that academic year. All bets were settled with pepsi. Whenever we went out, usually to play cricket, we would refresh ourselves with pepsi. It was the time of life when people had just started courting. Budding couples would go out to have – a Pepsi.

I don’t remember the exact date, but by the time we had moved to 10th, Preity Zinta had struck. With her “thodi si pet pooja”. Perk was the thing now. Considering that a chocolate bar is a much better device for putting blade compared to aerated cola, the number of “couples” also increased. Also, in 10th standard, the number of people going for tuitions increased, and this seemed to cause an increase in the general levels of pocket money.

There were people in my class who would stay in class for lunch break (when everyone else went out to the field) because knew they knew that raiding a certain classmate’s bag would yield them a rich haul of perks (the guy was simultaneously blading some four females, so his stocks always remained high). Then, unlike pepsi, perk could be consumed discreetly. Copious quantities of it were consumed while sitting in class (i used to sit in the first bench so that I could have unhindered view to a certain junior classroom, but  that didn’t stop me from eating perk in class).

I remember that on a certain day in August that year, the shop near the school ran out of Perk stocks. It was the day after rakshabandhan, and given the quantity of unsolicited blade that was happening then, the number of rakhis tied had seen a sudden increase. And that had to be reciprocated – with Perk of course. Some rakhis weren’t acknowledged, which meant that this was probably the only day in more than a month when certain people DIDN’T give Perks to certain other people.

The first four of my five “pursuits” were low-cost (three of those were in school; and even the fourth was before I had drawn my first salary, so you can’t blame me). All four of them put together, I don’t think I spent more than a hundred rupees on blade. This included ten rupees that I had spent on a perk for #1. She had dodged me all day, and by the time I gave it to her at the end of the day, it had melted in my pocket.

I think I should incorporate this scene in one of the movies I’m going to make. Boy chases girl all day, trying to give her a Perk. She skilfully dodges him all day, and evades his offer of Perk. And each time she evades him, he is shown putting the perk back in his pocket. Finally at the end of the day, they meet. It’s time to go – in the distance you can see her father on the bike, waiting to pick her up. And he gives her the perk. She opens it. The perk has melted. And then her heart melts. Ok I must stop now.

On how blogs have changed the way I look at books

I have more than a hundred feeds on my Google Reader. It could be much more, just that I haven’t bothered to keep track. Apart from these hundred odd feeds, I also read posts which have been shared by people on my GTalk friends list. And then, you have people who send you the odd link to some strong post or article, and I usually end up reading them too.

The point I’m trying to drive at is that most of my reading time nowadays is spent reading blogs and news articles and magazine articles. The kind of stuff that promises to offer a strong insight once every 1000 words or so, and usually delivers on that promise. Which, in effect, has spoilt me.

So, in effect, whenever I read something, I end up expecting an insight every few hundred words (no, i’m not that jobless to count words. this is just an approximate estimate). And this is the reason why, I think, I’ve stopped reading fiction. Fiction simply doesn’t offer the same kind of insights that blogs do. Yes, stories can be insightful. They do help you learn stuff. They definitely help you “develop as a person”. But if they are longer than a few hundred words (i still have appetite for short stories), they end up boring me. I quickly lose interest. I find no point in reading them.

Whenever I look at a book now, I end up comparing the experience to reading blogs. I see if the book can promise insight at the same rates that blogs can. Which is why I hate single-idea books. i had recently read this book called Why Popcorn Costs So much at the movies. My crib with that was that it didn’t offer enough insight for it’s length. What could have been explained in 20 blog posts had been stitched into a book.

In the era before blogs, such books made sense. There was no quick fix way to get insights, and you would be willing to plough through long books in order to get some insights. And for the author, there was no quick and profitable way of disseminating insights – he was forced to write long books. It was a sustainable market.

Blogging seems to have changed all that. There is a quick and possibly profitable way of disseminating informationn. There is a quick and easy way of receiving it. Some books that were great ideas in an earlier era simply can’t hold up now. In these times, if you are to write a book, you need to make sure that there is actually enough material to hold up all the pages that it’s written on. That even if the main idea can’t hold for so long (it usually can’t), you put in enough sub-plots and side-stories to sustain it.

I want to write books some day. Maybe even take that as a full-time profession – though it’s too early to call on that. However, when I do get down to writing this, I need to keep this concept in mind. That I will need to fill the book with enough insights to sustain it.

PS: i don’t feel the same about movies. I don’t mind the slow buildup and long periods where nothing happens at all. maybe it’s because the movie lasts only about two odd hours in its entirety.

The ibank bailout

  • After the Fed bailed out Bear Stearns and arranged for its sale to JP Morgan, I blogged saying that the Fed hadn’t done the right thing, and was now creating a situation of moral hazard.
  • When Lehman was in trouble, I said that this was a good time for the Fed to make amends for not allowing Bear to fail. Reputed commentors such as Michael Lewis backed up my claims (sorry, i’m too lazy to find links). And the Fed seemed to take our suggestion. And Lehman was allowed to fail
  • Now, following Lehman’s collapse (and I’m not sure if there’s a causality here), the entire global financial system is in trouble. No one is lending to each other (remember that in my original post I had said that the point of removing the moral hazard is that no one will lend to bad banks. Based on that it’s like as if all banks are bad now). The remaining banks are going down one by one.
  • It seems like the Lehman collapse is just a small part of the larger picture, and if things continue to go bad the way they’ve been, it’s even likely that the impact of the Lehman collapse will not be major compared to the total size of the crisis.
  • So the real danger is that by the time the crisis is over and everyone has recovered (it’ll take a long time indeed for this to happen), people would’ve forgotten about Lehman. Forgotten that banks are not necessarily too big to fail (and given how bad things have got, the Fed cannot allow more banks to fail). Forgotten that no one will bail out the creditors if someone in the system tells jai. And people will go back to their old bad habits
  • Important question to ask here is the role of the Lehman collapse in the magnitude of the current crisis. There definitely has been some impact, but it would be interesting to see exactly how much. Would this collapse have been as bad had Bear been allowed to fail when it was about to fail? How much incremental damage was done to the system in the six months between the two major ibank failures?
  • In hindsight it seems like the Fed might have done better in letting Bear fail rather than letting Lehman fail; actually we aren’t even sure of this.
  • The question remains as to how discipline will be ensured in the system, without too many restrictions, once the system is back up on its feet (it’s going to take a long time, mind you). Maybe we will see smaller banks. Large networks of smaller banks, with none too big to fail. Yes, there will be continuous churn, wiht banks failing continuously and new banks coming up to replace them. Banks will be more ruthless in dealing with each other.
  • But how does one ensure that the system goes into this particular steady state, and not any other, once it’s back up?

More on the IITM Open Quiz

A while back I was talking to Pota about the IITM Open Quiz, and its possible demise. I think what happened was that the quiz was in general closely held. Three of the four original quizmasters  were from the “no questions asked” team, and even after I graduated, people who continued ownership of the event were NQA guys.

We had a large number of non-NQA quizmasters (Ruddra, Chinmay, 10g, etc.) but the overall control of the event remained with NQA people. In each of its five episodes, all incumbent members of NQA contributed as quizmasters. Bhaand, who was the unofficial manager of NQA, was the coordinator of administrative affairs every year. Add to this the fact that the cultural secretaries and core group at IITM were in general hostile to the event, and you know what happened.

NQA was disbanded for all practical purposes in 2007, when The and RG graduated from IITM. Pota was the only one remaining on campus, and he did his job by coordinating the OQ of 2007. However, with the disbanding of NQA, there was no natural successor to take the event forward after pota. There was no one who could claim ownership of the event.

Looking at it from this perspective, maybe what has happened was inevitable. However, I think there is a lot to learn from this. A lot of lessons in terms of leadership, team building, succession plans, etc. I think I want to write a case study on this. If anyone of you has attended one or more OQs, and has any other feedback about this, please let us know. We can include that also in the case study.

All said and done, hope is not lost yet regarding the event. There is still the faint probability that we can somehow take it forward, on a different date. I’ll keep you posted on this.

Law of conservation of willpower and other stories

Every time I think about this article in the New York Times, I find myself agreeing more with it. The basic premise of the article is that in the short run, one has a limited “supply” of willpower, and by every activity you do that consumes willpower, you are reducing your ability to do other similar activities. In the longer run, the article goes on to explain, you can increase your willpower over time. This you do by keeping on pushing yourself marginally on the willpower scale.

Back when I first read this article (it was written this April), I used it to justify to myself as to why a normal management consulting job requires heavy amount of willpower. The argument I put forth back then was that in a mgmt consulting job (the kind of stuff done by McKinsey,  A T Kearney, etc) you have to work for long hours, mostly in the presence of members from the client team, and a large amount of work you do is mostly routine, and boring.

Given that the work is mostly boring, it consumes willpower to keep doing it. The long hours mean that you need to keep doing it for a long time, which means a high rate of willpower consumption for a long time – making your daily consumption of willpower really high. Typical work usually involves your exhausting close to your daily supply of willpower. One option would be to periodically recharge your willpower batteries – by indulging in activities that don’t require any willpower, and will also go into removing your frustration with the depleting willpower.

One of the most high-pressure jobs, one that consumes copious amounts of willpower, is trading. Though the hours aren’t too long, the rate of consumption is so high that you easily come close to the daily limit. However, traders usually manage by frequently recharging their willpower batteries. By indulging in activities such as shouting, screaming, throwing down the phone and breaking pencils. This way, they manage to survive until the time they get paid their bonuses (assuming they get a bonus – which is not the case with most traders this year).

The clincher with consulting is that you are usually based at the client’s location. This means that you must behave. And thus, a major source of recharging willpower batteries is gone! Hence, the only way you can survive in that profession is if you have an extremely large daily supply of willpower.

Every time I think about this NYTimes article, I also realize that my willpower is less than average. Though I must say that it’s been steadily increasing, it’s nowhere close to the average level. Initially, in school and college, I managed to get by because the amount of willpower demanded wasn’t very high, and within my limits. Then, I started working, and got exposed.

There was this guy called Yaso in my class at IIT who on one fine day started writing with his left hand (he is naturally righthanded). He explained that he was doing this to build up his willpower. I don’t know how successful his attempt was, but I clearly remember we’d made a hell of a lot of fun of him for this. Maybe I should check back with him. And start implementing some measures for improving long-run willpower that the article talks about.

When I went to watch a Hindi movie

So on Wednesday I watched a Hindi movie in a theatre after a gap of a year and three months. The previous time too, Ashwin was with me, though the rest of the personnel were disjoint. Anuroop also joined us this time, before he embarks on a mission to sell phones in the seven hills. I had seen Baradwaj Rangan’s positive review of Jaane tu ya jaane na and wanted to see it. And given that there was no other half-decent movie around, we decided to go.

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Billing rates

When I got my house painted three months back, the head painter suggested a new method of calculating his fees. Instead of charging by the man hour, which is how usually painters are charged, this guy proposed that we pay him by the square foot. Once all the work was done, he and I together measured up our house, and calculated his fee based on that.

And he had different slabs of rates, depending on whether we were using a single or a double coat, and there was a different rate for windows and grill work (there’s a lot of those in my house). This method of fee calculation was extremely convenient from my perspective as I didn’t have to run after the painters and make sure they were working. In the traditional model of hourly payment, you need to run after the workers and make sure they are working. If they take a tea break, they are wasting your money. If they are doing something slowly, again you are at a loss.

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Why fine dining costs so much in Bangalore

Blame the Bangarappa government of 1993, which took a decision to stop issuing more liquor licenses, a decision that still continues today.? According to

?(who runs the excellent Shiok, currently temproarily closed), the only way one can start a restaurant serving liquor in Bangalore is to buy a permit from someone who is shutting shop. In other words, the number of establishments serving liquor in Bangalore has remained constant for some 15 years now, despite the population growing by a large amount.

Apart from the fact that the supply of licenses is scarce, a bigger problem is in matching buyers and sellers. It is reported that officials in the excise department double up as a clearing house for these licenses, charging usurious commissions up to the tune of 25% of the transaction value. Adding to this the official costs of licensing, transferring license and other sundry costs, a liquor license is estimated to cost approximately about Rs. 30 lakh.

What this means is that existing establishments can continue to overcharge on liquor without the fear of a new competitor who might threaten to lower the prices in the industry. However, given that liquor consumption, especially at restaurants, is highly elastic, there is only so much by which the liquor can be marked up. Thus, for the thousands of entrepreneurs who have started thousands of fine dining restaurants in the last few years, the only way in which they can recover their liquor investment, and make a profit would be to mark up the prices of food items.

Another thing with fine dining is that restaurants that serve liquor vastly outnumber the ones that don’t. This is mainly because of the clientile of these? restaurants, who usually prefer a drink to go with their food. This market (fine dining) is highly elastic to the availability of liquor – restaurants stand to lose considerable business if they don’t serve liquor. What this means is that restaurants serving liquor are dominant in this market, and they are the price setters. So when you have the high-cost players in the industry being the price setters, it is clear as to why prices are on the higher side.

On the other hand, when it comes to fast food, south indian food and south indian – north indian food (north indian food made in south indian style), the presence of restaurants that serve liquor is negligible, almsot non-existent. Hence, the price setters in this market are low-cost players, which explains why they are very reasonable.

Then, in Chennai, the? government has a monopoly over liquor distribution, which means that restaurants aren’t allowed to sell liquor. This makes it okay for a fine dining restaurant to run without serving liquor, and hence the price setters in the market are not high-cost. This probably explains why fine dining is much more reasonable in Chennai compared to Bangalore.

The only missing piece in this puzzle is the Andhra style restaurants – most of them serve liquor and are yet extremely reasonable. Or is it that they serve only beer which has a separate license that is available more freely? Can someone tell my why this is the case?

And interestingly, Bangarappa, who put a freeze on further liquor licenses, belongs to the Idiga community whose traditional occupation is to brew/extract and distribute liquor.

Opportunity Costs

The concept of opportunity costs seems to be non-trivial, in the sense that most people don’t seem to get it. When I first learnt it as part of my Economics course at IIT Madras, I thought it was fairly common sense. However, looking around at a variety of people, it doesn’t seem to be that common.

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Buying pickles in Sringeri

That’s what i did immediately before I proceeded to the VidyaShankara temple to look for porn. I spent half an hour at the Sri VidyaShankara Home Products store buying pickles and other assorted condiments. I ended up buying a bottle of Appe Midi Mango pickle (made out of whole uncut tiny mangoes). Then one bottle of Amla (nallikai) thokku – a kind of chutney made with full amlas. My mom later told me she was keen we bought this because I usually don’t eat the fruit in amla pickles, and that it’s good for health.

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