Planning, Public Issues

New Engineering Entrance Exam: Has anything being achieved?

In Physics, there is a very interesting concept of ‘distance’ and ‘displacement’. Distance refers to the measurement of length covered by a person while moving. Displacement refers to the final difference between the initial and final position of a person. So when a man moves in a complete circle, he has moved some distance but his displacement is zero. Something similar can be said about our HRD Ministry and its new pattern for engineering entrance.

When this topic (change in the pattern of engineering entrance exam) first came in public limelight, there were loads of speculations as to how the new pattern would affect the main stakeholders (students, teachers, schools and engineering institutions). The ministry defined following objectives that it wished to achieve through the new pattern – 1) Reducing the stress on students 2) Incorporating the Class XII boards marks in the entrance system and thereby increasing the importance of school-going 3) Discouraging the business of coaching centres thriving in the country. Assuming that these objectives are worth achieving (which in itself is a big assumption), it’s time public evaluates if the new entrance pattern is a step in right direction to help the ministry achieve the aforementioned goals

First objective relates to stress.  Ministry said that the two exams would be fused into 1 single exam. Seeing the current pattern (and assuming that I can count correctly) there are still going to be two exams. And the surprise is that both of them are going to be on the same day. That means if a person is, for some unfortunate reason, not able to give test on that day, he/she would have to wait for an year. Unlike the present system, there would be no second chance in the proposed system. I believe that any rational person would take this step as one that increases stress rather than reducing it.

Then comes the perennial topic of discussion among science students, JEE enthusiasts, schools and the government: the importance of school education vis-à-vis subject matter of engineering entrance exams. The government has been successful to pay a deaf ear to the concerns regarding the inequalities and drawbacks in the prevalent system of board exams and somehow incorporate Class XIIth marks into the entrance system. But does that mean that there would be a steep increase in attendance? Not necessarily. The level of board exams is very low and there are enough books in the market to help students prepare for that. Many people will say that only those who go to school will get good marks in practicals. But the truth is that schools care a lot more for overall results. Hence, 90-95% of the students would still get good marks in practicals. So, the second objective looks as distant as it used to look before.

And now we come to the so-called eternal villains of the society – coaching centers. I would not comment anything on whether coaching centers are good or bad. That is for another article. What we need to see is whether the new pattern is adversely affecting the business of coaching centres or not? And the answer is: Definetely NOT. Coaching centers are already teaching physics, chemistry and maths. Now, they would supplement the engineering course material with some material for board exams. There is even a possibility that some coaching centres hire teachers for teaching the other two subjects: English and one among Economics / Physical Education / Computers etc. The point is, the new system does not present any considerable difficulty to the working model of coaching centres. So, even the last objective looks as near as horizon.

So, if the HRD Ministry looks nowhere near to achieve what it has envisaged, then what’s the point of bringing the new pattern? And at the time of writing this, IITs, other engineering institutions and alumni bodies are making plans to drag the issue to courts. Apart from feeling disgust for the interfering nature of HRD Ministry, I also feel sorry for the engineering aspirants. Especially those, who would appear in 2013 and are still uncertain about the entrance system.  I could only advise them to study hard for JEE topics and draw up a plan to get some good (if not too high) marks in Class XII board exams. But what advice for our HRD Ministry that has messed up once again? Seeing that the 2014 elections may be pre-poned, I could say only one thing – “Vinashkaaale vipreet buddhi” (during the time of our destruction, we go against our intelligence)


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Human Resources, Planning, Public Issues, Reflections, Strategy

The Value Of A Human Life

It was utterly shocking to read of Friday’s tragedy in Bangalore when a young 25yr old woman lost her life during a mock fire drill. The incident was captured live on camera and was repeatedly flashed across news channels. Its the loss of a young life in the most callous of circumstances that shows the quality of our systems and practices. Most of you folks reading this blog are probably around the same age as this girl. Or may be you have brothers or sisters of the same age. Think about it. Feel for this girl…and her family.

The accident could not have been more freakish.

The fire police expected the employees of the building to use ropes and enact an escape in what would have been a real fire with blazing fumes. Unfortunately, the rope snapped and gave way, presenting a horrifying sight of the woman flying down to her grave.
Indian news channels and newspapers carried the news on Friday. On Saturday the news was reduced to a corner section with a headline that the chief of the fire police admitted there was a lapse and that there was no standard procedure for such drills. Today news channels are not even carrying the story. And local newspapers may forget about it at the end of tomorrow.
It can be argued that this was an accident.
But there are may questions being raised: Why were there no safety nets? Why were the employees asked to use ropes and climb down? How come no-one thought of the consequences of the rope snapping up? How was the rope being suspended? Why didnt the police have a training officer to help women with the task of climbing down considering that even many men cannot easily do it?
But all of these questions ultimately hinge on the one big question: Why is there no respect for human life in India?
Our country does not value human life. Our governments, our system, our administrations do not value human life. Yes we value our families, our friends and brethren. But it stops there. The death of a nameless face hardly moves us. Which is why we saw on television the administrator who had a ‘canned’ answer ready when reporters asked about compensation for the victim’s family – the company would take care of the compensation from their end. And government will provide compensation based on the investigation.
That was all there was to it.
What if this was the death of a celebrity.
How would we treat it? Yes, I agree that a celebrity would bring out a lot of emotion and coverage across the country and even have massive investigation agencies lined out. But does an ordinary citizen deserve any less?
This is not the first such instance where our nation has shown how much it values a life. And we all know it. But we dont remember because we often attribute these incidents to nameless faces that we dont relate to.
This is not the same when you look at countries such as USA or those in Europe.
Entire buildings are shut down if a single person was affected due to a freakish accident. Laws are changed to avoid such events from occuring again.The affected victims are fully represented in trial courts, and ordinary citizens are empowered to sue any power of authority: right from the railway station where the accident took place to the mayor of the city who is ultimately answerable. The leadership cringes in agony at the death of a fellow human. Authorities visit the families of the victim and personally share the grief of the family.
It is in these times that the true value of a human life is appreciated – because its not just about how we deal with the loss of our loved ones. That is always paramount. But sometimes, a society is characterized by how we react to the loss of the loved ones of others.
Its only so much that we can do in the aftermath of such an accident. No one can bring back the life of the nameless 25 yr old girl who has frozen in our minds as helplessly flying down to her death because of the incompetence of the fire personnel.
However, whether we really value human life or not will be seen in the context of how we respond to this tragedy.
There have to be some very clear action steps/changes in mindset that I think we as a society can take on:
1. Exhaustive investigation
The authorities must thoroughly investigate what went wrong and how this accident was caused. The findings must be well documented and made public. More than making it public, all relevant departments of the fire police  as well as other agencies must be made aware of how and why this incident happened. The goal should be to ensure that such incidents do not happen again. We CANNOT allow for the odd thought that “sometimes these events happen”- NO.
2. Process! Process! Process!
We have to infuse in our work culture the absolute mandate to follow the process that is documented and is in place. We all have those bouts of complacency where we take short-cuts because of our gargantuan confidence that “nothing can go wrong today”. More often than not we get through with this. But on that one odd day when something can go wrong, it can be very very fatal. A lot of people get away with driving rashly on the road, or driving after drinking, or texting while they drive, or selling/buying adulterated food products, or smoking cigarettes knowing that is injurious to health. A lot of people play with their ethics by paying bribes to make their way ahead, or forging documents to forge ahead (pun intended). Yeah, mostly nothing happens. But sooner or later, the indiscipline or lack of ethics catches up – and when it does, it can be really really bad.
3. Contingency Plans
We need to bring upon a culture of factoring in contingency plans in our aspects of work. Its probably grossly exaggerating to label this as contingency: but surely, the planners of the mock drill should have had safety options and back up plans for any part of the drill that could have gone wrong. This is not just for the fire department, but for all of us. Think about your fields of work: You may be writing a computer program that could alter the lives of millions who claim their insurance from a company, or you could be designing the combustion engine of the next generation sports utility vehicle. Every step that we take must be fool proof. There is no greater joy in being able to impact the lives of people through our work. But we need to make sure that while we work towards the happy path, we are also ensuring that the consumers/customers/beneficiaries of our products have a way to redeem themselves should anything go wrong. Because the essence of life is that – things do go wrong.
At the core of all of this is the realisation we should lay a premium on the value of every single human life.
This is the least that, nameless faces like us, can do by way of a tribute to 25 yr old girl who died on Friday.
Thanks for reading
S Rao
Note: The picture shown above is that of the tree of life. It was found on the internet. No copyright infringement is intended.
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Planning, Public Issues

Why tamper with good things?

A recent news article in Hindustan Times stated that IITs have acceded to the demand of HRD Ministry of merging IIT-JEE with AIEEE to have one single engineering entrance exam for the whole country from 2013. The speculations are rife that the new system will have equal weightage for marks of Class XIIth boards and marks scored in engineering entrance exam. The news has created a furore in the engineering community and with good reason.

The first question is the merger of exams to have one single exam. The logic given by the HRD Ministry is that currently students have to give 3-5 entrance exams and that puts undue stress on them. The truth, obviously, is quite the opposite. Multiple exams provide more opportunities. So, if somebody has an unlucky day on the day of IIT-JEE, he/she can do well in AIEEE and get admission in a good college. With the new system, the students would be under extra pressure to perform because the next opportunity would come after an year.

The second issue is that of quality of the paper. IIT-JEE is much more intense and difficult than AIEEE paper. As one of the IIT-Directors have mentioned that many elements of JEE would be retained, one can expect the paper to be of a decent quality. It is difficult to comment on this issue till the format of the exam is officially announced.

The third and the most weird thing is introduction of Board’s results with an unusually high weightage (50%). It means that IIT-JEE and class XIIth board exams will be considered as equal. This is beyond logic. Consider this – while 1000+ students all over the country score 100/100 in maths paper of 12th boards, only few are able to score above 85% in the maths paper of IIT-JEE. I sincerely hope that this is just a speculation and the actual weightage of boards exam is not more than 15-20%.

It is high time that HRD Ministry leaves IITs alone and do better things. Their hasteful implementation of OBC quota and increase of seats has already caused various problems to existing IITs. All these actions may badly dent the brand of IITs which is highly dependent on the quality of the incoming students. Well, let’s wait for the formal announcement and see what surprises will be thrown at us.


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Planning, Public Issues


It took 15 years and 3 governments for India to finally see a green light for the entry of foreign retailers in multi-brand retail format. Yet what we are witnessing is one of the biggest political uproars against this decision of the ruling party. Seldom has the opposition unified in such a manner. One wonders what is wrong with this move of our government.

Let’s examine the proposal that has been passed. It states – 51% stake in multi-brand retail with a minimum investment of $100 million of which about 50% has to be spent on back-end infrastructure. Along with this, the government would keep an eye on the prices and hypermarkets would be introduced in only those cities which have a population of more than 10 lakhs. As of now only 53 cities qualify the aforementioned criteria.

So what is the uproar all about? “Foreign retailers will kill domestic small scale retailers (the kirana shops). Traders are going to lose a lot. Unemployment will rise. Prices would be dictated by foreigners and the common man and the farmer may lose in long run.” Hence, most of the political parties have taken the responsibility to resist the entry of this devil from hell.

However, these accusations have the support of neither logic nor history. Logic dictates that such a move will serve two purposes – decrease prices leading to cooling of inflation and bringing in large investment which is very essential for a country with current account deficit. And history has shown that both small scale retailers and hypermarkets can co-exist peacefully (US, Europe, Australia are examples). It is pretty obvious that this move will not only improve the supply-chain structure of consumer goods but also provide a greater share to farmers and to consumers. It is weird that opposition parties are fighting for “rights of 5 million middlemen of our supply chain” but nobody is talking about the benefits to 1.2 billion consumers or to 600 million farmers who, on an average, are still very poor. But of course, this is not the time to think about the farmers. They will be an important part of thought process during Lok-sabha election-campaigning and during the announcement of parliament budget. Right?

In my last article, I condemned the workings of Parliament where there has been a constant situation of political stalemate. Now I firmly believe that some of our politicians are neglecting their responsibility towards the country. I neither condemn nor appreciate the overall performance of the government but I really appreciate this move of the government. Till this article was written, our PM has defied all appeals and protests to roll-back on the decision of FDI. This is good as it increases the confidence of investors and share markets. Make no mistake, the stakes are very high. A roll-back would grievously erode the confidence of most of the foreign investors and deteriorate the investment-environment in the country.

Please comment what do you think about this issue.


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Planning, Public Issues, Strategy

IIT and AIEEE coaching classes – Villians or Necessary evils

Article by a Guest Strater – Ankur Singh.

In the 1st week of October, Mr. Narayan Murthy, one of the greatest visionaries of our times, said at a Pan-IIT conference that quality of IIT students is falling because of coaching classes. Few days later, Mr. Chetan Bhagat, a noted engineer-turned-novelist, remarked that Narayan Murthy could have been gentler in his comments. He even slammed Infosys as a “body shop” and said that one should look into the system and not criticize students.

Both of them had a point. The falling quality of IITians may indeed be true. Mr Murthy has been in industry for long and he may have observed that. However, putting the blame straight-away on coaching centres may not be right. The main criticism leveled against coaching centres is that they kill the innovation instincts of students. That coaching centres are actually producing dull students.
Let’s take a look at an alternate scenario. Suppose that there are no coaching centres. Everybody prepares for engineering entrance exams with help of the education provided by school. Now consider what is taught in the school and what is asked in the entrance exams. The concept may be the same but the difference comes in the level of practice provided by schools and the level that exams like IIT-JEE and AIEEE demand. Almost 99% of Indian schools worry about the result of class XII board exams. And here we see the reality. The board exams are so easy (at least those for Maths stream) that anybody who has studied Maths sincerely for 2 months may score 95+ marks. Do coaching centres kill the innovation instincts will always remain a debatable question but most of the students who both take coaching classes and pass entrance exams with good ranks are hard-working and well-versed in basics. They have a good background of Physics-Chemistry-Maths and are better prepared to take on the rigors of college academic system. So who is better, a 99% school topper with fragile concepts or a 90% percent scoring student with good knowledge-base of Maths and Science? The choice is not difficult to make.

Another keypoint is that Mr Murthy said that quality has been going down “OF LATE”. Now coaching centres have been there since 1980s. Hence, some recent phenomenon must have aided this downfall. And that could well be the unnecessary increase in quota for backward classes. I am not against helping the needy but one must understand there is no feedback mechanism in this quota system. Government passes the law for increasing the seats and then walks away. What they should actually do is to see if the students who got admission via quota are actually doing well or not. Analyse their performance in college, look at the jobs they have got or the research they have done. I, being an IITian and a placement student-head of an IIT, know that the results, as measured by these parameters, are grim. It clearly states that help must be given, but not as reserved seats in premier institutes but compulsory primary and secondary education.

This is where our government should rise from deep slumber. Rather than making blunders like increasing the quota or making the Class-12th exams easier and “stress-free”, the curriculum and the level of papers should be re-modelled. The logic is simple, if the Boards exams for science students are difficult enough, then they would not need any coaching preparation for entrance exams.

The fault lies in our education system. That’s why I mentioned in the beginning that Mr Bhagat had a point. As we don’t have a good-enough class 11-12th education level, coaching centres are actually doing this country a favor. I am not saying that they are a necessity but to make them redundant would require a considerable effort on the part of government and a sound thinking on the part of guardians, parents and students. I request all of you to express your views on this glaring educational issue of our time.

Notes from the Editor: This is an article contributed by Ankur Singh – A guest strater. Ankur works as a Strategy and Operations Analyst with Deloitte Consulting and studied at Indian Institute of Technology, Delhi earlier. The article serves as an eye opener about the value added by Engineering Entrance Exam coaching centers in the Indian Education Ecosystem. We look forward to more insights from Ankur in the coming months. Also, the views expressed are author’s own and neither supports or opposes them. is a forum for thought provoking discussions and will continue to remain so.

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Business, Marketing, Planning, Public Issues, Strategy

Commonwealth Games – Is there any accountability?

Commonwealth Games or CWG as they are popularly known in India, are being considered a success! After the initial media publicity exposing the scams of the games organizing committee, now everyone is silent!

CWG was considered as the moment of glory for India. It was supposed to be our arrival moment on the world stage. Delhi had prepared for this event since many many years. People say the prestigious Delhi Metro Project was started in preparation for the games. The huge development of Delhi’s infrastructure, the flyovers, the roads, the new airport, everything was part of one big plan. Well some of these things were well executed, but some were not. Media started the fire of exposing the corruption but now nothing is being done.

At one point it seemed the games will not even happen. Many countries were close to declining the invitation because of bad reported conditions in the CWG games. At this point many colleagues were taunting us regarding India. At that time, a part of me actually hoped that countries decline and CWG games do not happen. Being an Indian I knew that if CWG games do happen then no one will investigate the scam any further.

What we don’t realize is that why CWG failure can be so detrimental for India? A scene from the movie Philadelphia comes to mind “Say I gotta send a pilot into enemy territory… and he’s gonna be flyin’ a plane that costs $ million. Who am I gonna put in that plane? Some rookie who can’t cut it so I can see if he is up to the challenge? Or am I gonna give that assignment to my best pilot… my sharpest, my most experienced, my top gun… the very best I got? I just don’t get that. Would somebody please explain it to me… like I’m a six-year-old?” So when a country like India is supposed to organize the most awaited event for the country, who will be expected to be take the charge?? Well it was given to Mr Kalmadi!

Why does India fail like this? When India has one of the world’s best companies which excel at every angle, always deliver on time, excellent quality, meeting budgets, truly international standards …. then why did India fail in making CWG a success from the beginning?

The answer again is quite simple. India has 2 sides, one is government control companies and other are private companies. Government companies are like a monopoly and have basically no standards while private companies are truly international standards. CWG was being organized by the Government Monopoly and since a monopoly has no remorse, thus anything goes. All private companies have a reputation to protect in order to get repeat business. But with Government companies the monopoly exists because if any games need to happen in India then they will have to be organized by the Government Monopoly!

One thing which further remains unanswered is why Media is silent now? Searching on Google News for “CWG Scam” gives the latest result as of September 24th 2010, which is almost 2.5 weeks ago! We really need Media to stand up! Make a report with 1,000 pages giving explanation for every expense done by the CWG organizing team but make it. We need explanations and accountability for corruption. It is high time!

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Business, Planning

Dubai – the Crown of the Middle East!

Burj Khalifa

In November 2009, Papers around the qorld were shouting from their front pages about the Dubai Recession:

Fears of a dangerous new phase in the economic crisis swept around the globe yesterday as traders responded to the shock announcement that a debt-laden Dubai state corporation was unable to meet its interest bill.

Recently I made a visit to Dubai to a convention called ‘MahaBiz’ – which essentially gave entrepreneurs from Maharashtra a platform to expand their business in the MENA(Middle-East-North Africa) region in general and UAE in particular. While Dubai hasn’t fully come out of recession yet, the place’s importance as an important trading spot remains unquestioned. I was visiting Dubai after 6 years and the pace at which it has changed and transformed itself is tremendous! The expenditure on infrastructure, cleanliness, order and planning for the future by Dubai has to be one of the best in the world at present.

While I fully agree that Dubai and India are completely different nations in almost all respects, I really feel that some aspects of what Dubai does should be adopted in India as well. After all, the Dubai story has really happened post 1990s.

Among many things I loved about Dubai , these are the top 3:

1. Infrastructure spend: Dubai must have spent so much on infrastructure, its almost surreal. Roads, main streets, highways, freeways, buses, metros – you name it and Dubai has it of a world-class level. Who better than someone from India to understand the importance of infrastructure. Whats more, they haven’t simply spent money, they have actually done timely implementation – they must have had 100s of Sreedharans (of Delhi metro fame) with their fold , with tremendous backing (and pressure) from the rulers.

2. Foresight – To have envisioned that Dubai could become a huge tourist spot in the 1980s was itself a masterstroke in my opinion. Everything, right from their official airline – the Emirates to the huge malls Dubai has built point to this foresight. Even now, the state has built so many highrises that for next 20 years, budding companies can easily find a place in Dubai to start their office at. In this matter, Singapore would perhaps still be catching up with Dubai.

3. Cleanliness – The city is absolutely clean. Even in the late April heat, the ubiquitous street maintenance department was quietly doing its job in Dubai. Perhaps this might not be such an important thing for someone staying in say, Europe/US, but for an Indian, the difference is marked.

Now, why do I call Dubai as a city to watch out for? For one, they have used their location and converted it to a strategic advantage. Next, as mentioned above, their infrastructure and planning is second to none. Thirdly, they have quick decision making, one significant advantage of a monarchy.

(For one, many apologies to those following for not writing for so long! I love writing here, but somehow couldn’t give proper time for strat for last 6 odd weeks. Lots has been happening around me. But I promise to be more regular from now on! For any queries related to – do write to me at siddhesh AT strat DOT in)

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Business, Entertainment, Marketing, Planning, Strategy, Technology, Web

End of an era – Floppy Disk

I saw this news article on BBC News and it got so many memories back. We all are so lucky to be witnessing technology and the world around us changing so much. It seems like yesterday when I got my first computer which had a floppy disk and a CD drive. I played so many games even on MS-DOS which were actually stored on a floppy disk! A floppy disk in which I transferred programs to school from my home PC and made my school project.


On the left there is an image of a floppy disk. The simple device stored just 1,024 kilobytes of information but was so important to people. Because at that point of time even 1,024 bytes were sufficient for transfer of information but now even gigabytes don’t suffice.The first floppy disk was introduced by IBM in 1971 and it used to be read-only! After 40 years the floppy disk comes to an end and it sure seems like a new era is beginning.

CDusb-flash-driveSome of the devices which have replaced the floppy disk are CDs and USB drives. Two of the main reasons why these devices became so much more popular are storage capacity and resistance to data damage. Of course one of the reasons for their popularity was the ability to transfer movies and music. Next came DVDs and transportable HDDs and now Blu-Ray Discs. With each generation of storage we get more capacity to store information in smaller space.

ipodIt seems ironical that the company which started the slow death of Floppy Drives is the company which probably will take the storage industry to the next level – Apple! Apple was the first company which in 1998 stopped having floppy drives in its computers. Slowly Dell (2003), PC World (2007) and now Sony have also stopped providing it. iPod and iPhone store your music, your movies and a lot of your information. It also works like a hard disk and you can store everything you want on it, making all other forms of storage obsolete! Where will technology take us next? Only time will tell.

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Finance, Planning, Politics, Public Issues, Strategy

Lessons from Greece for India

By now almost everyone will know the entire Greece story and if you don’t then please do read some economic news on the world. The effect of the controversy on one country (Greece), one region (European Union), one currency (Euro) and million of people is unbelievable. Not really unbelievable … because this has happened to countries before but everytime the nuances are different. The important thing is to get a few lessons from the entire debacle specially for India!greece

  • Taxation System: I read last week that Greece has over 11 million residents but only only a few thousand claim to have an income above 100,000 euros. Is it really possible? Nevertheless if residents can get away without paying taxes then they will. For now India also has a taxation system full of loopholes, where anyone with a big company has to pay taxes but small/big business don’t and black money is prevalent. Government needs taxes and without taxes budget deficit cannot be reduced.
  • Importance of Currency: One of the main issues facing Greece is the issue of currency! Greece comes under European Union and has Euros as its currency. If Greece had an independent currency then it could have taken a hit on its currency, exports become cheaper, imports become expensive, the life in the country changes but it would not be as complex as it is.
  • Market will not always be rational: A lot of people ask that why has the focus on Greece come now? Why didn’t it come last year? The budget deficit was still very large last year. All the existing problems have existed for many years. Thus why now? Its because markets are not always rational and we all should be used to it. The bandwagon effect is most prominent in financial markets and when a run begins it is very .. very .. very difficult to fight it even for nations.
  • Don’t spend more than you earn: This is very difficult to maintain specially for Governments but if you continuously do it for years then what can you do.

This is definitely not an exhaustive list. Would be great to hear your views as well!

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Finance, Planning, Politics

Bash the Bankers ! – Updated 17/1

Until about 1.5 years back, Investment banker was one of the hottest and wealthiest job anyone could ever have. It was the ‘Angelina Jolie’ of all campus placements. But today, if there is one profession you want to bash and kick at and get an applaud – just lash out at any top executive employed with one of the global financial institutes or banks.

And of course our hope president Obama is not going to fall back. So he has lashed out at the bonuses declared by the banking institutions and asked them to pay up first before throwing away all the bonuses and has declared a $ 117Bn levy recovery plan over the next 10 years. In what I think is one of the most logical decisions made by the government, he has rightly decided to bash the big guys with more than 50bn worth and that too as a tax on all ‘wholesale finance’ and not the retail deposits and equity capital. So banks dependent on retail public deposits are relatively better off, but bad news for the likes of Goldman Sachs.

But what puzzles me is, is all this really required? Was the bailout money just thrown away at these people while they were out with the begging bowl without a fixed plan to recover every penny of the taxpayers money back? Or more importantly, are the top financial institutions still so greedy and shameless that they have absolute no moral responsibility of taking things easy for about 2 years until they have paid back what they owe to the world(World because when these guys decide to go down, they don’t go down alone. They take the entire world with them). It is like your house catches a fire, you don’t have money to rebuild it and the local sheriff convinces the neighboring community to help you out. You rebuild the house and in 6 months buy a new porche before paying your neighbors back.

So instead of saying – ok, we messed up, thank you taxpayers for bailing us out & we will not take a bonus and get things back on track, you take a big perk and flaunt it shamelessly. Banking institutions seem to be moving towards a role of milking the economy rather than serving the economy. Does this not expose the cultural degrade due to hard core capitalism.

India has a relatively closed banking and financial system that kept it that much insulated from the global crisis. But the big question is, I don’t know if it will happen, but if we are talking about India becoming a developed super power – do we become an easternized- eastern super power or a westernized eastern super power. So will we be able to keep the advantages that our culture has ingrained in us-  for e.g. the attitude of saving, or will we adopt the mistakes of the west as well while moving ahead. Imagine a bank employee from India and I am sure for most who have visited the bank at times, the image would be an honest and sincere middle aged employee who counts the notes for you and hands them over with a smile. I am not aiming at keeping things primitive, but the important point here is – ‘honest and sincere’, not over smart and sly. I hope we retain that always.

A closed banking system will give rise to more number of alternative finance institutions which would then pressurize the government into securitizing their mortgage products. And though it may seem far off, we know what can happen with our government policy decisions. And a completely open will inflate the bubble again. Hopefully, we can hang on to that golden mid way somewhere.

Lets hope when its our turn to dictate the world, we become a socially, morally and culturally responsible capitalist giant. Fearlessly smart and aggressively good !

Updated : 17/01/10

In conclusion, the entire deregulation in US has enabled the bankers in US to do as they please and left the tax payers to suffer. The US went through one of their worst crisis after the great depression, millions of lives were damaged through cutbacks, job loses and washing away of all savings and all this pain, I feel, was self inflicted. The financial system went to being unstable due to adoption of reckless deregulation right from the financial reforms US congress enacted from 1970.

The “Financial Crisis Inquiry Commission” is drilling top bankers to decipher the cause of the crisis. Do follow the day to day coverage if you wish to know what the bankers are having to say after everything. A glimpse :

Mr Dimon of JP Morgan said that the “happens every five to seven years. We shouldn’t be surprised.”

And Mr. Blankfein of Goldman Sachs -“We should resist a response … that is solely designed around protecting us from the 100-year storm.” – So basically intending that its cool, it had to happen, don’t over react.

Lots of other interesting metaphors to go through out here. No one can summarize things better than Paul Krugman : “It tells us that as Congress and the administration try to reform the financial system, they should ignore advice coming from the supposed wise men of Wall Street, who have no wisdom to offer.”

Image Credits : 1

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