27 May 2012
Another hartal in Kerala
Kerala had another hartal on Thursday (24 May 2012) to protest the hike in petrol prices. Shops dutifully closed down. Most autos and public transport vehicles stayed off the road. Not to exaggerate too much, everything shut down.
The organizers of the hartal -- the Left parties and the BJP -- sought to foster the illusion that the hartal was voluntary. A tell-tale paragraph in The Hindu
, on the day of the bandh, told the true story: "The LDF convener called upon traders to down shutters and said hospitals, marriages, milk supply and newspapers would remain exempted from the hartal." In plain words, everyone else who dared to open up would have their shops broken up. Nothing voluntary there.
When I took a brief walk outside on the day of the hartal CPI(M) cadres were on the lookout for transgressors. But they had a bored look about them ("Been there, broken that") because it has been a very long time since anyone was foolish enough to violate a hartal.
The CPI(M) is of course not the only party to call for hartals. On 5 May the ruling UDF ordered a hartal to protest against the murder of T.P. Chandrasekharan, a politician who had quit the CPI(M). If Keralites had consented to the hartal, as the organizers of the hartal would no doubt have us believe, their consent must have been tendered in their sleep; Chandrasekharan was killed at 10.30 pm on 4 May and the hartal began at 6 am the next morning. Here too a paragraph in The Hindu
told the true story: "Ambulances, marriage parties, medical shops and milk distribution have been exempted from the hartal."
Some time before this the BJP called a hartal to protest against the inclusion of another Muslim League minister in the Kerala cabinet. Indeed, hartals are so frequent in Kerala that there is a web site devoted entirely to the subject at www.harthal.com
A few months ago, when Baba Ramdev or Arvind Kejriwal referred to politicians as criminals there was a great hue and cry. Some politicians who were interviewed on television seemed genuinely surprised that they should be labeled criminals.
But can you think of anything more criminal than depriving millions of people of their livelihood for a day by the use of force? I can't.
21 May 2012
What if everyone treated you like Tata-Docomo?
This is my experience with Tata-Docomo.
About five or six years ago (I am not sure when) I bought a CDMA phone from Tata-Indicom with an inbuilt SIM card. To tell the truth I did not have too many complaints about the service.
Then a few months ago the phone began to run down and eventually neither the speaker nor the microphone would work and all the phone could do was send SMS messages. So on 21 April I walked to a nearby Tata Docomo centre to try and get a new SIM card with the same number so that I could put it in another phone. The office was being mopped when I walked in and the cleaning woman looked at me as if I was something a hyena brought in. (I should have thought the office would be cleaned before it opened so that customers did not make a mess of it, but let that go.) When I put forward my request I was curtly told that SIM cards were out of stock and I had to go a couple of kilometres to the next centre. Not so much as a courteous apology. Well, I thought, if this is how Tata Indicom treated its customers I would take my business elsewhere.
I walked to the nearby office of another mobile operator and from there put in a porting request. I was told I would get an answer within 15 minutes to an hour. When that did not happen I went home and put in another request. This time I got an answer: "Dear Customer, Your Unique Porting Code xxxxx already exists and is valid upto 06-05-2012. Thank you." I forwarded this message to the mobile operator to whom I wanted to transfer the number. Later, however, I got another SMS saying: "Hi. You are not eligible for Mobile Number Portability. Continue enjoying TATA DOCOMO with Fantastic offers."
When the number was not ported I filed an online complaint with TATA DOCOMO on 30 April. I promptly got an automated reply saying: "We have received your complaint about your Tata DOCOMO number 9249868082. Your complaint has been registered with our customer service team. The Reference No. is 490085. You will be receiving a call from our customer representative, within 48 business hours, who shall attend to your complaint and provide a resolution at the earliest. It is our aim to provide you a satisfactory resolution as early as possible."
Of course there was no reply within 48 hours.
On 9 May I got an email saying: "Thank you for reaching out to the Tata DOCOMO Customer Care Team. We trust your complaint, docket no: xxxxx, has been addressed to your complete satisfaction."
When I wrote back saying that it had not addressed my complaint at all, I got a reply on 10 May: "Please be informed that your MNP port out request has been retained as you have delayed in contacting other operator for port in request within 7 days. Hence, request you to send the port out sms once again and contact the other operator with in the given time lines to get the number activated."
With so many contradictory messages being sent to me I obviously don't want to go through the whole rigmarole all over again. So I am stuck with a phone which is useless except for sending SMS messages.
Tata-Docomo has a television campaign going on now whose punch line is: What if everyone treated you like your mobile operator? My question of course is: What if everyone treated you like TATA-DOCOMO?
Just a few days into this experience I received a call from TATA AIG touting their insurance schemes. No prizes for guessing what my response was.
19 May 2012
J.P. Morgan is only the tip of the iceberg
All eyes are turned on Greece. And for the life of me I cannot understand why. Greece is a tiny country and its debt, even if all of it goes unpaid, is not large compared with the size of the global economy.
The graph below, showing Corrected Money Supply from 2001 to March 2012 for the US, paints quite a different picture. It shows that US monetary expansion is at unprecedented levels, which can be explained only if US financial institutions have piled money into financial assets and pushed up their prices to unsustainable levels. The prices of these assets, since they are at unsustainable levels, have got to crash. J.P. Morgan's reported losses of $2 billion are only the tip of the iceberg. The coming crash will follow the same trajectory as the Great Depression, Japans's Lost Decade and the Great Recession. First prices will collapse in one or more financial asset markets. This will be followed by the collapse of some financial institutions and then by the economy. Of course it could happen that US financial institutions have created derivatives based on Greek or other financial assets, whose combined size is tens or hundreds of times bigger than the size of the underlying assets.
I hope that at least then the foolishness of judging the health of the economy by inflation will become apparent, although I have very dim hopes that this will happen.
Explanations of the above graph can be found in The General Theory of Money
, my ebook which is available on Kindle.
07 May 2012
My new ebook is available on Amazon's Kindle Store
My new ebook The General Theory of Money
is available on the Kindle ebook store at http://www.amazon.com/dp/B0080WPK2I
Here is the product description:
Three times in the past century - before the Great Depression, before the start of Japan's lost decade, and before the Great Recession - central banks have committed a fatal error. From the fact that economic growth was on track and inflation low they concluded that the economy was in fine fettle. Today central banks are committing the same error and setting the stage for another Great Crash.
This book demonstrates that the root of this fatal error is a misconception of money common to the Keynesians, monetarists and Austrians that has vitiated all of economics for nearly a century.
The exposition begins by disproving the idea of money multiplication through fractional reserve banking, an idea that is regarded as so obvious that it is taught to every undergraduate. Taking this as its starting point the book then draws up an operational measure of money, which faithfully mirrors every turn of the economy since 1960. Along the way it shows that the velocity of money is stable and that the mainstream view of money as one form of wealth is erroneous. It also lays bare the errors of John Maynard Keynes, Milton Friedman and the Austrians, all of whom have one thing in common: they completely disregard financial assets.
The book is targeted at economists. But the simple measure of money that it draws up is of vital importance to every investor. If you are a mutual fund this book could save you millions of dollars. If you are a hedge fund it could save you tens of millions of dollars. And if you are the president of the United States it could save you a trillion dollars.