Friday, December 05, 2008

Dollar woes

The dollar has become the most sought after currency post the October carnage we've seen in the equity markets. A slap on the face to those who suddenly felt that the Euro would replace the Dollar as the world's benchmark currency. I always wondered when did the currency that ultimately influences the value of the Euro become it's poor cousin.

The stories about $ weakness came about post lot of news of Crude being traded in Euro by Iran supposedly the 4th largest reserves. And then others that sought to trade only in Euros when as fears of US making a mess of a larger mess.

There is another theory that is doing the rounds in some quarters is the lack of dollar credit domestically and its direct impact on impeding growth. In effect these arguments are put forward by self styled/proclaimed Nobel Laureates.

Yup Ratan Tata has gone on record that raising funds globally has become tough. This is not something specific to the dollar but credit as a whole abroad including India. Also credit growth for October is 29% as reported by TT Ram mohan. And by all published Data credit growth has been increasing and increasing quit sharply.

One always read credit growth figures for last year to be in the range of 22-25%. For the month of October which saw the worst carnage in Indian markets that was attributed to lack of fundamentals, credit crunch etc. how does credit growth remain so high?

I remember KV Kamath in 2006-7 screaming that interest rates must go down as there is no credit off take. Dickhead just tell it bluntly that you wanted the world to borrow more and have a better yield on your advances. There is demand for credit today but you real scared to fund it. And if what are you funding? Credit to buy more dollar to be put abroad?? And are you consicoulsy funding it towards factors the contribute to economic growth?

And then there are those who believe that the reason for the slowdown in the economy is because his Standard Chartered banker/friend told him that there is no "dollar credit". When did HLL or Maruti fund its domestic working capital requirement or expansion plans using dollar credit?

Oh yes the Big infrastructure companies have been raising funds abroad, given the interest rate differential last year. But I thought several restrictions were placed on ECBs as the rupee went into the upward spiral last year. So credit off take at the corporate end was only restricted to funding from abroad in dollars and domestically its was us Indians whose credit requirements funded the real estate boom. So that explains the Credit growth figures Huh???

Suddenly its sounds as if Dollars was the chosen currency for credit off take. What ever happened to the good old rupee...

I obviously ain't denying the impact of dollar shortage and its impact on credit. But to say that dollar credit not being available and therefore projects domestically are not being funded is utter stupidity.

I thought there is a shortage of rupee funding: The logic-- RBI has been buying the rupee aggressively post the FII sell off to support the rupee from depreciating further. Therefore the central banker has been absorbing huge amounts of rupees from the system as hedge funds and Hot money flew away. So rupee has suddenly become tight which obviously then impacts credit off take domestically.

The other obvious indirect impact was the Dollar shortage globally. Again not the need for dollar credit but just the asset(if one could still call it). The problem was two fold. One where domestic banks had to buy dollars from the central banks to replenish the shortage and their working capital/reserve requirements abroad. Second is where Corporates that could not meet working capital requirements and various ambitious expansion plans because of the dollar shortage abroad. And there is also enough talk about how various forex products sold again by these "fresher MBA-I know it all types" which probably have fuelled the need for more of the greenback to fund their off balance sheet items.

Wednesday, December 03, 2008

Knee-Jerk Reactions

It's been 3 days since the bloody siege. And now the usual analysis of what should be done with Pakistan, what should be done with our politicians, why did the NSG come in BEST buses et al.

I mean for Christ's sake let not your Allegiance to the nation be defined by sending stupid chain mails about " Letter to Prime Minister" and send this to every Indian. How did nationhood and the love of it revolve around how many Indians you send a very poorly written letter. For Christ sake there is anger. Each one burns from within to see the helplessness the state is in. But these stupid chain mails don't help and don't elucidate any constructive action. Wanted to ask the dude authored the letter as to when was the last time he celebrated heros such as Satyendra dubey and Manjunath. Also to ask those who like duds kept forwarding it?

There was another stupid logic about why NSG was made available the services of BEST v/s Cricketers being sent in luxury air conditioned buses. "Send this to every Indian" sort of crap.

There is an obvious logic of not sending troops in luxury buses that are not air conditioned. Your body is supposed to be accustomed to the outside environment. Haven't you felt slightly dizzy when you come out of cold room into the blazing sun. Its the body stupid. Worldover Aromured vechiles are desinged to endure hostile envrionments. Unlike cricketers NSG doesn't have the luxury of a warm up session. NSG and their kin worldwide are trained to manage hostile environment. Yup we feel dam proud to see these guys coming out of Neeta bus service. Do you guys even know the names of anyone of those heroes? Neither did I. I bet most didn't know who Jyoti Krishna was. So much attention We've paid uh for the supreme force. And so much for being Indian.

I mean guys the right reaction would be "dedicated buses and not makeshift ones".

Shobha Aunty said on TV" My god, we don't have water pressure to reach the 6th floor of taj. Aunty I guess your angst is as funny as Aish's dresses. Water pressure has its limitations. Its the equipemnt used along that ensure (ladders,cranes etc.) that are essential

Another foolish thought is to send some 25 people and do the same dastardly act. Send spies into enemy territory. You joker, don't you realise that it's already in place? as in the intelligence apparatus. It's efficiency maybe in question but again that cannot be assesed. Is the govt. to make a public announcement that we have spies in xyz country? There is enough info put by the media about prior knowledge about a possible attack. So yes the buck lies with administrators who reflect a careless lackadaisical attitude towards security. Which I must say is nothing but a reflection of society. The common man as well has displayed his quota of insensitivity's towards internal security.
And then we have reactions that all politicians should be shot down. Dude I thought we elect them. Its the posh areas of Delhi, the rich, the elite is where from Manmohan Singh fought an election. But the obvious apathy towards polity ain't doing any good.

The only reason the rich elite don't vote is cause the quality of politics doesn't matter. Its not them that bear the brutal train rides or the long bus journey's in the summer. Its always been that the privileged section to been the last to react and probably the most passive.

Every country deserves the politicians they get. This is Democracy. I'm sure these everyone wants a Chinese style governance where some magic wand would cure all our ills. I bet every drop of blood in my body that each one of us would desist it.

Then we have "Carpet Bomb Pakistan". Dude they are a Rouge nation. A govt. likes our whose in control of nothing. Unfortunately a nuclear power. It takes one idiot to call the wrong shots probably end the last war the world will ever see.

Impotent rage: Honestly candle lights, standing/marching for solidarity.... I'mt not sure how much it works. We are a country of protests and these protests have never worked. These maybe be great symbols to communicate affection but unfortunately lead to no action. I 'm not being cynical. But wouldn't a quick check to the blood bank be more useful? We all want action but from whom? People who called Major Unnikrishnan's house not worth being look by a dog?

Tackling Terror

My response to your write up.

Are you saying that the present laws suffice in tackling terror and it's only the lack of implementation thereof that has led to this mess?

Oh yes we are to blame for being passive and insensitive in the past. But irrespective of our cooperation and obedience to the law there are things that are essential to basic governance.
If a section of today's polity believes the current legal statute to deliver in various cases, it's only to cater to domestic political compulsions. Period

I'm sorry but the administration's attitude in dealing with terror cannot be looked into isolation i.e. along with its approach to ensuring basic internal security ,ensuring right laws are in place to speed up various judicial processes are also of relevance.

Take the ex. of MCOCA. It's foolish for us to believe that the present law suffices to deal with the menace that we see. Various cases have seen the day cause of provisions within the law. The train blasts case, the Bharat shah case where simple tapped conversations between the accused and underworld/terrorist elements are inadmissible in the present context which is not the case in MCOCA. The ability to secure more time in judicial custody et all contribute to overall quality of jurisprudence.

Take the malegaon case for instance. MCOCA is and was essential in ensuring a speedier investigation. Period.

Laws are required just as equipment if not more important than the bullet proof jackets we are all suddenly gunning for. Laws have helped. Its only when the selective application of it again to cater to "Not being tough on certain communities or being perceived as tough".

Again here the sincerity with which the law is applied is of utmost importance. I won't deny the tendancy of it being used against the weaker sections.

I ai'nt targetting any community. Remember its the hindutva brigade that filed PIL's against the application of MCOCA on the Malegaon blast accused. Its the same law that was applied to speedy disposition of justice in the train blast case.

Assume you have an intercept of X person discussing a y act of terror and this intercept cannot be used to further investigation process cause the law doesn't enable them to do so. Surely that ain't helping the morale and neither does citizen obedience and cooperation with governance agents help.

But shouldn't law take its own course given the tough times we live. I am ready to give up certain luxuries that I enjoyed. Be it being frisked daily et al.

POTA rather poto (since it was an Act) is oft quoted as being anti-minority. Okay let me not mince words its accused of being Anti- Muslim. Remember under the law its not Muslims but a large no. of Naxalities against whom the law was applied. So much for it to be perceived as anti-minority.

I am again not going to drum the importance of law as it as well cannot work in isolation. Unfortunately the only way militancy has ever been contained is through the Gun. Punjab is an example of how through brute force and aggression militancy was contained. Force has worked. Flowers, gandhigiri don't work. You ain't fighting a civilised government.

Again here its the intention behind using the force that eventually decides the outcome.

If physical aggression is used as a means to avenge, it will never work. A tit-for-tat approach has never and will not work. If the intention is to ensure further acts of terror are not carried out v/s it being mere revenge seeking, the unfortunately the gun works.

The excesses whilst ensuring these acts and the use of force has it own consequences. Like Kashmir. Excesses have been committed. But what would we choice in the environment that we live in. The end of militancy at the cost of some but yes very precious lives or consistent acts of terror against the state.

Tuesday, December 02, 2008

Salaam Mumbai

What a week it was! A week that re-defined India's landscape on the global map and left scars deep in our minds. India will never be the same again. How ironic as I write this given that Mumbai was the hot spot for various cowardly Sena's to tell us who belonged to this city. A city that was torn apart on the basis of which state you belonged to. And now when we talk about the ghastly act perpetrated by the bastards of a perverted faith we don't talk about it as an attack on Mumbai but one on the Indian state.

Answers to "Why Mumbai was attacked?" are fairly simple and ubiquitous. Mumbai is India. It's been the melting pot of the country. It represents aspiration, hope, struggle, joy, culture above of a spirit iof resilience(will still defend it). Unlike northern cities such a New Delhi where the migration is from places such UP and Bihar or Kolkata where it would be the not so fortunate North east and people across the border, Mumbai has always had a potent mix of people from all over India. Be it Gujaratis marwadi's that dominate various businesses or the shetty's that occupy the reins to India's own fast food chains. Be it the sweat and blood of the labourers from the southern parts of India that build the dreams that we live in to the drivers that yes do ensure that we get home safely.

This city is India. Period. It represents what we are as a nation. The organised chaos of Mumbai's transport is reminiscent in the way India functions. Chaotic but still manages to scrape through. Here rains are enjoyed each year despite the havoc it brings in. Our gods are celebrated despite having failed to protect us. We still move on... Is that a good thing???

Yes. Lot has been made about the "Spirit of Mumbai" (cliche as it may be) and the passiveness its brought about that everything in this city will be endured. The spirit is important and has nothing to do with passiveness. Its also has nothing to do with inaction. They are mutually exclusive. Every city has a flavour that makes it what it is.

It's the strenght on which the city lives and moves. It's the oxygen towards hope of a better tomorrow, the fire burning in you despite all odds. To move on be it besides the lack of choice.

Yes I concede that the "spirit" has been made too much about but cannot be rendered as fodder to those who wish to do nothing. But its the same spirit when all else fails, seems to overcome our sorrows.

11/7 was a prime example, where people did take to the streets to help commuters, slum dwellers looking to rescue the faith of people who they have never known. Surely when the basic amenities fails you it boils down to its people and how they make the best of a bad situation. Its the spirit that pushes strangers to help each other when all hell breaks lose, In city where the infrastructure will short, governance will succumb to populist pressures and security is next to impossible.

Though yes a lot of it has been made as an excuse to bear the brunt of the that goes wrong with the city one cannot belittle its importance. It something which every city needs and I know only one city that has it. All be it shattered but still moving on....