On age and experience and respecting elders

A lot of commentary about the financial crisis of 2008 spoke about there not being anyone around who had experienced the Great Depression of the 1930s. The American Economy was largely stable till the end of the 1970s, they had argued, because the memory of the Depression was fresh in the minds of most policy-makers, and they made sure not to repeat similar mistakes. With that cohort retiring, and dying, however, in the 1990s and 2000s there emerged a bunch of policy makers with absolutely no recollection of the depression (in the 1990s, most policy makers would have been born in the 1940s or later). And so they did not hedge themselves and the economy against the kind of risks that had brought America down to its knees in the 1930s.

Now, think back to a society which was far less networked than ours is, and there was little writing (“no writing” would take us too far back in time, but think of a time when it was fairly expensive to write and store written material). This meant, that there were no books, and little to understand and experience apart from what one directly experienced. For example, one would never know what a storm is if one had never directly experienced it. One wouldn’t know how to light a fire if one had never seen a fire being lit. You get the drift. Back in those days when societies were hardly networked and there wasn’t much writing, there was only one way in which one could have learnt things – by having experienced it.

I suspect that this whole concept of elders having to be unconditionally respected had its advent in one such age. Back then, the older you were, the more you had experienced (naturally!), and hence the more you knew! There was no other way in which one could accumulate knowledge or understanding. In places like India, even education didn’t help, for “education” back in those days consisted of little more than learning the scriptures by rote, and didn’t teach much in terms of real knowledge. So taking the advice of elders naturally meant taking the advice of someone who knew more. It is natural to assume that these people who knew more than the ones around were respected.

With the advent of books, and later (post Gutenburg) the advent of cheap books, all this began to change. It became possible for people to know without having experienced. It became possible for people to get more networked, and the direct impact of both of these was that it became possible to know more without having really experienced it. In this day of highly networked societies and wikipedia, it is even possible to know everything about something without even pretending to have experienced it (attend some high school seminars and you’ll know what I’m talking about). There is no connection at all now between age and how much you know.

Culture, however, doesn’t adapt itself so quickly. It didn’t help that “elders”, whose position as the “most knowledgeable” was being threatened thanks to writing and networking, were also the people in power. In any case, the real reason of respect for elders had probably been lost, so it was easier for them to extend their reign. And so it continues to extend.

Older people nowadays fail to recognize that younger people might know more than them, and get offended if the younger people tend to argue with them. Yes, experience is still a great teacher, but the correlation between experience and knowledge has long since been broken. As the pupils sang at the beginning of the Vishnuvardhan starrer Guru Shishyaru (the teacher and the pupils), “doDDavarellaa jaaNaralla, chikkavarellaa kONaralla, gurugaLu hELida maatugaLantoo endoo nijavallaa” (elders are not wise, youngsters are not buffaloes, what the teacher says is never true).

PS: As I was writing this, it struck me that this whole “respect for elders” paradigm is more prevalent in societies (such as India) where education was largely religious. Societies where education was more secular don’t seem to have this paradigm.

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.