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Alok’s reading notes – Part 1

For years, I’ve been reading The Economist, Wall Street Journal, New York Times, Financial Times, Fortune etc and attending meets, conferences etc.

Most of the stuff I’ve picked up and learnt is in my head & I’m guessing that isn’t the best ‘long term’ storage place. Also, thankfully, my memory is NOT publicly google-able by others. But this stuff HAS to be shared!

So, I’m just adding notes and snippets that I think are worthy of sharing (ONLY for non-commercial, academic and general interests). Browse them once in a while – or specifically when you are making a PPT or writing an article, for interesting quotes or chat-patta trivia! 

Abbreviations – E- The Economist; WSJ – Wall Street Journal; F – Fortune (F); NYT (New York Times); FT (Financial Times) & others mentioned case on case. PLEASE CREDIT these sources if you use these quotes and link to the content if possible.

I separate updates (typical monthly by adding *** at the end)

TO be updated on additions, simply add any comment at the end. You will then receive an e-mail from me every time I update this page!

April onwards notes are available here

Here goes:

Feb 2014 – March 2014

Male doctors in the 1960s married nurses because there were few female doctors. (E)

A single share bought in Coca Cola in 1919 is now worth over $10 million (WSJ)

Over a decade Vodafone has invested more than $25 billion in Turkey and India. These operations made a paltry 1% return on capital last year. (E)

Suzuki, a Japanese carmaker, found that its formerly sleepy Indian arm accounted for the biggest chunk of its market value. (E)

Start with takeovers. There have been $1.6 trillion-worth since 2002. A rule of thumb is that half of all deals destroy value for the acquirer. (E)

There are 86 Lego bits for every person on the planet. By 2017 Lego men are expected to outnumber humans. (E)

January 2014

Market Capitals of emerging countries and how puny they look when juxtaposed by single Market Caps of Western markets! (E)

– IT IS no secret that equity analysts at banks do not always give the best investment advice. In 2001 Eliot Spitzer, the attorney-general of New York state, exposed their habit of heaping praise on undeserving firms with which their colleagues hoped to do business. Some had advised clients to buy stocks they had referred to in private as “junk”, “crap” and “shit”.

Roger Loh of Singapore Management University and René Stulz of Ohio State University looked at analysts’ forecasts of profits and the buy or sell recommendations they issued for the period 1983-2011. Their predictions, it turned out, were less reliable in falling markets than in rising ones, even after making allowances for increased volatility in such times. Analysts’ forecasts of profits for the next quarter were out by 46% more during periods of financial crisis than at other times, for instance. (E)

– AT GOOGLE they call it the toothbrush test. Shortly after returning to being the firm’s chief executive in 2011, Larry Page said he wanted it to develop more services that everyone would use at least twice a day, like a toothbrush. Its search engine and its Android operating system for mobile devices pass that test. (E)

–  “Software is eating the world,” says Marc Andreessen, a Silicon Valley venture capitalist. (E)

–  According to a recent survey of 12,000 people aged between 18 and 30 in 27 countries, more than two-thirds see opportunities in becoming an entrepreneur. That signals a cultural shift. “Young people see how entrepreneurship is doing great things in other places and want to give it a try” (E)

– Suckers aren’t born, they’re trained. (Wolf of Wall Street)

– In retrospect, it’s a miracle that anything worked in the late ’90s given how limited the market was and given how expensive it was. It’s a miracle that eBay worked, it’s a miracle that Amazon worked. Marc Andressen in an interview with WSJ explaining how different the startup scene is today.

– “About half (51 percent) of the 6.6 million pregnancies in the United States each year (3.4 million) are unintended” and “the U.S. unintended pregnancy rate is significantly higher than the rate in many other developed countries.” NYT

– A history of USA Unemployment: (WSJ/NYT) – Click to expand

– How the Rich got Rich:

December 2013

– Data reviewed by The Wall Street Journal showed that one major record company makes more per year, on average, from paying customers of streaming services like Spotify or Rdio than it does from the average customer who buys downloads, CDs or both.

The average “premium” subscription customer in the U.S. was worth about $16 a year to this company, while the average buyer of digital downloads or physical music was worth about $14.Other data from the same company showed that in the long run, even many individual albums eventually make more money from streaming services than they do from downloads. (WSJ)

It took 34 months for an album by an “indie rock/pop group” to make more money from streaming than from sales. An album by one “modern male R&B rapper” reached that juncture after just four months.In both cases download revenue flattened as sales flagged, while streaming revenue continued to climb as people kept listening to the music.

In Sweden, where streaming subscription has overtaken downloading as the most popular method of acquiring music, the difference is more pronounced.

An average premium subscriber there is worth about $17.75 to the company, versus less than $4 for the handful of people who still buy music. (WSJ)

– Top Hotels in the world via strict standard operating procedures (SOPs). The Marriott family turned the method into a science. The second-generation boss, J.W. Marriott junior, who still runs the firm, became a fanatic. “When I say that the company’s prosperity rests on such things as our sixty-six-steps-to-clean-a-room manual, I’m not exaggerating,” he wrote in his 1997 autobiography. 

A veteran chef explains the grip that SOPs have. From Tokyo to São Paulo all omelettes must match a laminated picture (they should be cigar-shaped). A manager in Dubai says he follows 2,300 rules, including the phrases used to greet guests. A 2010 Hilton manual stipulates that staff must answer phones after three rings, that guests’ pets may not weigh more than 75lbs (34kg) and that scuba-diving boats must provide free pieces of fruit. A 2004 SOP book for InterContinental allows staff to wait until the fourth ring, requires drinks to be refilled when two-thirds empty and specifies that rooms must offer at least four pornographic films. (E)

– 60% of Apple’s revenues are generated by products that are less than four years old. Therefore, they have a more uncertain future: Harvard Business School’s William Sahlman warns young entrepreneurs about “the big eraser in the sky” that can come down at any moment and “wipe out all their cleverness and effort”. (E)

– That old US Navy saying, “Keep it simple, stupid”, is not a bad rule for management too, simple-minded though it may sound. (E)

– How CEOs screw up:

Mr Messier spent $17.5m of Vivendi’s money on a New York apartment for his personal use. Fred Goodwin, boss of RBS, micromanaged the building of a £350m ($630m) head office, called “Fredtown” by his underlings, and found time to redesign the bank’s Christmas cards.  About 40% of the heads of FTSE 100 companies employ “personal coaches”. (E)

– Some of the most creative people in business have been very peculiar indeed: Henry Ford loved conspiracy theories of the blackest hue; Thomas Watson of IBM commissioned company songs in his own honour. (E)

– Mr Ram Charan is so dedicated to studying the inner life of firms that he spent years without a home, flying from hotel to hotel. (E)

– American students are bored by math, science and engineering. 

Engineers and physicists are often portrayed as clueless geeks on television, and despite the high pay and the importance of such jobs to the country’s future, the vast majority of high school graduates don’t want to go after them. Nearly 90% of high school students say they’re not interested in a career or a college major involving science, technology, engineering or math, known collectively as STEM, according to a survey of more than a million students who take the ACT test. (NYT)– Only 18 percent of American adults can calculate how much a carpet will cost if they know the size of the room and the per square yard price of the carpet, according to a federal survey. (NYT)

–  Like physical stores, online clothes sellers suspect they have a hard core of habitual returners. In Germany there has been talk of “Zalando parties”, with giggling teenage girls ordering crateloads of stuff for a big weekend, only to send it all back (complete with forgotten car keys and other such stuff in the pockets). 

November 2013:

– “Strategy, it turns out, is really about trying to work out in a sensible way how to get from one stage to the next. With each stage a new set of problems has to be negotiated before you move beyond it. There is no end point: strategy is not simply a grander name for a plan, something that moves you forwards in predetermined steps. As Helmuth von Moltke, a 19th-century German field-marshal, put it: “No plan survives contact with the enemy.” Or Mike Tyson, still more pithily: “Everyone has a plan ’til they get punched in the mouth.” A strategy that starts with objectives and works backwards is one that is likely to fail. (E)

– Since 2010 worldwide air-cargo volumes have grown by just over 2%, from 50.7m tonnes to a forecast 51.8m this year. And revenue is shrinking, from $66 billion in 2010 to an expected $59 billion this year. But robust e-commerce, the growth of demand for cheap package delivery and such specialist freight as refrigerated medicines have helped the two firms buck the trend. (E)

– As Benedict Evans, an analyst based in London, put it: “Bezos has chosen to run Amazon to be the biggest, most powerful and successful retailer on Earth 20 years from now. Any fool could run it profitably today.” (NYT)

– Said Colin Gillis, senior tech analyst at BGC Partners (On Amazon). “It is easier,” he said, “to sell things and not make money than it is to sell things and make money.”

– “What Amazon is trying to do is raise my expectations so that I’ll eventually buy everything from it,” Mr. McFarland said. “At some point it won’t have any more competition, and I won’t know if prices are being raised because I’ll have nothing to compare it to.” (NYT)

– A company has strong incentives to degrade product durability when it has a lot of market power and when consumers don’t have good substitute products to choose from. (That’s what happened with the international light-bulb cartel of the early 20th century, which penalized its members for manufacturing bulbs that lasted more than 1,000 hours.) (NYT)

– Tyler Cowen, an economist at George Mason University, once pointed out that America has more than 3,000 halls of fame, honouring everyone from sportsmen to accountants. If people cannot reach the top of one ladder, they climb a different one. (E)

– Mr. Bloomberg, is not especially charismatic. His motto—“In God we trust; everyone else, bring data”—is not one to set the crowds chanting. But it makes for sensible government. Under him New York has weathered the financial crisis, cleaned its streets and become a magnet for talent and tourists. (E)

– New York needs its plutocrats. The top 1% of its taxpayers fork out a whopping 43% of the income taxes; if they leave, public services will suffer.  (E)

– “OPERATIONS consultants sit at the front of the classroom,” says a partner at a strategy consultancy. “Strategy consultants stay in the back, not paying attention, throwing paper airplanes. But they still get the girls and get rich.” (E)

– At Microsoft, Qi Lu, an executive vice president, submitted a 56-page report on applications and services. Mr. Ballmer sent it back, insisting on just three pages—part of a new mandate to encourage the simplicity needed for collaboration. Mr. Lu says he retorted: “But you always want the data and detail!” Mr. Ballmer says he started to realize he had trained managers to see the trees, not the forest, and that many weren’t going to take his new mandates to heart. (WSJ)

– Economics of real pirates (E)

A recent report’s authors estimate that between $339m and $413m was paid in ransoms off the Somali coast between 2005 and 2012. The average haul was $2.7m. Ordinary pirates usually get $30,000-75,000 each, with a bonus of up to $10,000 for the first man to board a ship and for those bringing their own weapon or ladder. 

– Economic Times Award’s function notes:

October 2013

– IN INDIA there are about 280m cows. They produce valuable things—milk, dung and calves. But cattle are expensive to keep. The biggest outlay is food—the average cow consumes fodder worth about 10,000 rupees ($160) a year. Veterinary costs also add up. (E)

– According to ICRIER, a think-tank, only 7% of Indian villages have a bank branch. (E)

– CONDOLEEZZA RICE trained to be a concert pianist. Alan Greenspan, former chairman of the Federal Reserve, was a professional clarinet and saxophone player. The hedge fund billionaire Bruce Kovner is a pianist who took classes at Juilliard. Multiple studies link music study to academic achievement.

Paul Allen offers an answer. He says music “reinforces your confidence in the ability to create.” Mr. Allen began playing the violin at age 7 and switched to the guitar as a teenager. Even in the early days of Microsoft, he would pick up his guitar at the end of marathon days of programming.It’s in that context that the much-discussed connection between math and music resonates most. Both are at heart modes of expression.(NYT)

– “IF YOUR seat belt is a bit uncomfortable, it might be because you’re sitting on it,” quips the Alaska Airways flight attendant during the passenger safety announcement. The recording became a hit on YouTube, a video-sharing website. Jokes can make serious messages more effective. Mr Mukherjee and Ms Dubé found that funny anti-skin-cancer ads made people 20% more likely to use sun cream. And amusing anti-AIDS messages in Norway were more effective than the austere Canadian offerings. (E)

– ON JUNE 16th something very peculiar happened in Germany’s electricity market. The wholesale price of electricity fell to minus €100 per megawatt hour (MWh). That is, generating companies were having to pay the managers of the grid to take their electricity. It was a bright, breezy Sunday. Demand was low. Between 2pm and 3pm, solar and wind generators produced 28.9 gigawatts (GW) of power, more than half the total. The grid at that time could not cope with more than 45GW without becoming unstable. At the peak, total generation was over 51GW; so prices went negative to encourage cutbacks and protect the grid from overloading. (E)

– “NO URINATION or defecation in the working area.” That admonition was among 13 rules that managers felt necessary to post on the walls of a shambolic fridge factory in Qingdao in the early 1980s. (E)

– Incensed that a fifth of the products his plant turned out were defective, in 1985 the CEO of Haier -Mr. Zhang handed out sledgehammers and joined employees in smashing 76 faulty fridges in public view. That won him national celebrity and was the start of the firm’s transformation.

By listening closely to demanding consumers, his firm’s fast and frugal engineers came up with clever products like mini-fridges built into computer tables (for students), freezers with a slightly warmer compartment (for keeping ice cream soft) and horizontal deep freezers with two tiers of drawers (for Americans too lazy to dig to the bottom). Haier also developed new niches, such as affordable wine fridges, ignored by Western rivals obsessed with economies of scale. It is now pioneering wireless charging of appliances. (E)


September 2013

– Settlement risk is also known as Herstatt risk, after a German bank that failed in 1974 and left many of its counterparties nursing big losses.

– How nothing remains the same

– ATM density in the world:

– GIACOMO CASANOVA, an Italian writer and bon vivant, was not easily shocked. But when he visited London in 1763 he was appalled to see Londoners brazenly urinating in the streets; in Venice, at least, people discreetly used doorways.August 2013 (E)

– Mr Mishra compares two villages 15 kilometres (9 miles) apart, near the city of Bhopal in central India. One has been connected to the road network since 2009. The other just has a dirt track. In the first, land prices are three times higher, wages are 50% higher, and far more people commute and engage in market gardening. At the present rate, it will take half a century before India’s economy is fully formal.(E)

– “CAFUNÉ (N): A STROKE or ruffle of a loved one’s hair”. That Brazilians have coined such a specific word testifies to their physical warmth, sense of touch—and obsession with hair. (E)

– The lesson of “Breaking Bad”

Three things help our chemistry teacher turn an insight into a flourishing business. The first is huge ambition. He is not in the “meth business” or the “money business”, he says. He is in the “empire business”. The second is product obsession. Other dealers might peddle “Mexican shoe-scrapings” on the ground that addicts care little about quality. He produces the king of meth, so pure that it turns blue, and would rather destroy an entire batch than let an inferior product be traded under his brand. The third is partnerships and alliances. He spots talent in a former pupil turned drug-dealer, Jesse Pinkman, and forms a strong working relationship with him. He also contracts distribution to a succession of local gangs so that he can concentrate on the higher-value-added part of the business: cooking and quality control.

– Strained relations between companies and distributors are common: in one survey 80% of executives said that they had worries about “exclusivity, control and resource protection” (E)

– AC Nielsen, a research firm, says that 70% of women in India cannot afford sanitary products. Many who can pay do not, as they hate having to ask for them in drugstores that are usually run by men. This has serious consequences. Adolescent girls miss up to 50 days of school a year. Some 23% drop out altogether. Working women lose their daily wages. (E)

– How to stop getting hacked

– In the 1950s one-third of America’s workers belonged to a union. Today 11.3% do, including just 6.6% in the private sector (E)

– Almost 70 years after that first Dundee lecture Mr Coase won the Nobel prize for economics. “A scholar must be content with the knowledge that what is false in what he says will soon be exposed,” he noted in his speech. “As for what is true, he can count on ultimately seeing it accepted, if only he lives long enough.”

– THE INTERNSHIP”, a film about two middle-aged no-hopers who land work experience at Google, is a dire offering even by the standards of Hollywood summer comedies. But it does get one thing right: that it is rather absurd for a technology firm to provide slides for staff to play on, and to let them wear silly propeller-hats. Google is not alone in its juvenile tastes. Box, a Silicon Valley company, has installed swings in its headquarters. Red Bull, an energy-drinks firm, has a reception desk in the shape of a giant skateboard in its London office. Businesses of all types have moved towards sitting workers in groups in open-plan rooms, just like at nursery school. Time was when firms modelled themselves on the armed forces, with officers (who thought about strategy) and chains of command. Now many model themselves on learning-through-play “Montessori” schools. (E)

– Montessori management has plenty of supporters in the higher reaches of business. The bosses of Google (Larry Page and Sergey Brin), Amazon (Jeff Bezos) and Wikipedia (Jimmy Wales) were all educated in Montessori schools. So was Will Wright, a video-game pioneer. Messrs Page and Brin credit their Montessori education with their enthusiasm for thinking differently. Mr Bezos thanks it for his enthusiasm for experimentation—for “planting seeds” and “going down blind alleys” as he puts it. Mr Wright says SimCity “comes right out of Montessori”. (E)

– Morten Hansen of the University of California, Berkeley studied 182 teams who were trying to win a contract on behalf of a professional-services firm. He found that the more time they spent consulting others, the less likely they were to win a deal. This shows, he says, that collaboration has costs as well as benefits. (E)

– According to one survey around 70% of all offices in America have gone open-plan. Yet evidence is mounting that this is a bad idea. Over the past five years Gensler, a design firm, has asked more than 90,000 people in 155 companies in ten industries what they think of this way of working. It has found an astonishing amount of antipathy. Workers say that open-plan offices make it more difficult to concentrate, because the hubbub of human and electronic noise is so distracting. What they really value is the ability to focus on their jobs with as few distractions as possible. Ironically, going open-plan defeats another of Montessori management’s main objectives: workers say it prevents them from collaborating, because they cannot talk without disturbing others or inviting an audience. Other studies show that people who work in open-plan offices are more likely to suffer from high blood pressure, stress and airborne infections such as flu. (E)

– WHAT do you say to a teenager with a job? Answer: “A Big Mac, fries and a Coke, please.” At least, that was the joke in happier times.

– How to sleep!

– In the USA in 1930, house calls accounted for 40 percent of physician interactions. By 1980, that number had dropped to 1 percent. (NYT)

– The cost of a doctor visit at home in the USA is around $500 a visit (Rs 33,000)

– THE job of clever people is to ask difficult questions. The job of very clever people is to ask deceptively simple ones. Eighty years ago a young British economist wondered: why do companies exist? Ronald Coase and asked this question and attempted to answer it. That won him the Nobel prize for economics in 1991 (E)

– “We’ve had three big ideas at Amazon that we’ve stuck with for 18 years, and they’re the reason we’re successful: Put the customer first. Invent. And be patient,” he said. Jeff Bezos speech at this newly acquired Washington Post (NYT)

– Only 3% of Indians pay income tax, so the government’s tax take is puny.  (E)

August 2013

– The left invented paid holidays in France. In 1936 Léon Blum, leader of the Popular Front government, gave workers the right to two weeks’ paid annual leave, with discounted railway tickets to help factory workers and their families head to the seaside. (E)

– There is a saying in Buddhism: Don’t just do something; sit there. (E)

– Women in the US make $0.77 for every dollar a man makes (FT)

– “You say the word ‘math’ and people shut down,” says Mr. Frenkel, sitting outdoors in New York’s Bryant Park. In his book, to be published in October, the tenured professor at the University of California at Berkeley argues that the boring way that math is traditionally taught in schools has led to a widespread ignorance that may have even been responsible for the recession.

“It’s like teaching an art class where they only tell you how to paint a fence but they never show you Picasso,” he says of elementary school math classes. “People say, ‘I’m bad at math,’ but what they’re really saying is ‘I was bad at painting the fence.’ ” Love is a different story, though. “People might think they hate math but everyone loves love,” he says. “I want to put more love into math.”

What he means is that while the philosopher Pythagoras lived over 2,000 years ago, his theorem still exists today; it holds true across cultures, time and space. “How many things have the same endurance?” he asks. Mathematical formulas “have a quality of inevitability.” (WSJ)


– Mr. Ballmer, meanwhile, told Fortune magazine in 2006: “I’ve got my kids brainwashed: You don’t use Google, and you don’t use an iPod.” If he had let them, he might have understood sooner the revolutionary impact of these products.

– TEN years ago sportswear-makers were cramming ever more features and futuristic designs into their products. They were convinced that the consumer bought, say, training shoes based on their technical specifications. But in 2004 James Carnes, today adidas’s creative director for sportswear, and a Danish consultant named Mikkel Rasmussen met at a conference in Oslo at which Mr Rasmussen challenged this notion. A mobile phone, he said, may have 72 functions, but that is 50 more than most people wanted, or used.

– In a related project, an anthropology doctoral student working for ReD mailed dozens of customers a disposable camera, asking them to photograph something that made them work out. Of 30 women who responded, 25 sent a picture of a little black dress, says Mr Carnes. The company had assumed that most customers were training to be good at specific sports; in fact for many, fitness itself was their “sport”.

– How oil prices and production has moved:

– Only 3% of Indians pay income tax (E)

– When a new technology rides into town, the moguls try to destroy it, but it survives and becomes part of the town’s future. Hollywood loathed the VCR (comparing it to the Boston Strangler); the networks hated cable TV; sheet-music publishers feared the phonograph; Socrates was sceptical about writing (not interactive enough, apparently). Yet nearly always two things happen: the old media survive (people are still buying vinyl records and even the odd printed magazine), and the new media expand the market. (E)

– The internet is the same, only more so. This year will be the first in which the average American will spend more time with digital media each day (around five hours) than watching television (4½ hours), according to eMarketer, a research firm, though many of these hours will overlap.

– Browser shares:

– According to executives familiar with the ads, Facebook will charge around $2 million per day to let advertisers reach the full Facebook audience of adults aged 18 to 54 (via video ads). As a comparison, a 30-second spot during the last Super Bowl cost advertisers about $3.8 million. (WSJ)

– “Windows is a hammer, and everything looks like a nail” to Microsoft, saidRyan Block, a former editor at Engadget and a co-founder of Gdgt, a gadget Web site. “You can look at the Surface, which is the best example; they created this totally blown-out tablet based around Windows and Windows-like experiences that didn’t translate” for most people. (NYT)

“The people in Redmond have a fundamental misunderstanding of what users are looking for, which is not speeds and feeds,” said J. P. Gownder, a vice president and principal analyst at Forrester Research. (Microsoft is based in Redmond, Wash.) (NYT)

– THIS year will be the first in which emerging markets account for more than half of world GDP on the basis of purchasing power, according to the International Monetary Fund (IMF). In 1990 they accounted for less than a third of a much smaller total.

– Housing prices movement in the world

– Mealtimes are no longer conventional or clearly defined. People eat often and quickly. One study comparing Britain and Spain found that about 40% of Spaniards were eating at 2.50pm and about 30% at 9.30pm. At no point in the day were as many as 20% of Britons eating. Over the years, peaks in sewage flow have greatly diminished, notes Rob Smith, chief sewer-flusher for Thames Water. (E)

– Last year almost a quarter of the houses and flats that sold in Mayfair were bought—for up to £3,500 ($5,400) per square foot  ( alok = 3.25 LACS per square foot )—by Indians, according to Peter Wetherell, an estate agent, making them the second biggest buyers after Britons. (E)

– At a recent conference organised by Simon-Kucher, the 100 or so delegates were asked to put their hands up if their company had a written pricing policy. Just two did so. Setting prices, promotions and discounts is often left to junior people and local sales offices. Even where a policy is set from the top, the salespeople may ignore it because they are still being rewarded for maximising sales and keeping customers. Neil Hampson, a pricing expert at PWC, says he sometimes starts his client meetings by asking: “When was the last time you congratulated a salesman for walking away from a client?” Most have never done so.

Second, companies need to remember that, as the late Peter Drucker, a management guru, once put it, customers do not buy products, they buy the benefits that these products and their suppliers offer to them.

In the early 2000s executives at General Motors were told to wear badges with “29” on their lapels, as part of a disastrous plan to get back to a 29% market share in America. This merely reinforced car-buyers’ assumption that GM would offer them whatever discounts it took to shift its metal off the forecourts, putting the firm on the road to bankruptcy. Simon-Kucher’s consultants praise DHL, a logistics firm, which spent years drilling into its customers that whatever the economic conditions there will be a rate rise each year.

Fourth, there are lots of simple presentational tricks that almost everyone is wise to but which still, miraculously, work. Restaurants add some overpriced wines lower down the menu to make the ones at the top seem reasonable. Makers of ice cream offer “33% extra free” rather than “25% off” the cost of the regular size, even though these are arithmetically the same thing. Buyers at big industrial firms are just as susceptible to such “framing” when reviewing a list of widget prices. (E)

– In 1961 North Korea’s income per head, at $160, was twice that of the South, despite heaps of American aid. (E)

– Price movement of luxury goods

July 2013

– Around 13% of Americans were obese in the early 1960s, as compared with 36% today (about two-thirds of contemporary Americans are considered overweight or obese), which can make a trip to the beach a jarring experience. (WSJ)

– The Yuasa Phenomenon. This is a theory expounded by a Japanese physicist and historian, Mitsutomo Yuasa, in the 1960s. Since 1540, he declared, the mantle of global scientific leadership has moved from one country to another every 80 to 100 years. The United States, by his reckoning, became the leader in science in 1920. (NYT)

– Allison Stewart, of the SAID Business School at Oxford, says that Olympics tend to have cost overruns of about 180% on average. (E)

– BAM is the 4,300km (2,700-mile) railway across Siberia that cost the Soviet Union $14 billion and took 36 years to build. BAM was one of the projects that crippled the Soviet economy, as Yegor Gaidar, a former prime minister and architect of Russian reforms in the 1990s, wrote in an article published as long ago as 1988. He argued that the Soviet Union had wasted its money on construction projects whose main purpose was to “utilise” government funds. This was made possible only by a political culture which deprived people of any say and substituted the narrow corporatist interest for the country’s. (E)

– The pressure to marry remains heavy in today’s China, where almost 80% of adults have tied the knot at some point, compared with only 68% in America. (E)

– Last year online sales of shop-based American retailers grew by 29%; those of online-only merchants grew by just 21%. Apart from Amazon—which has long spurned profits in favour of growth—most pure-play online retailers are losing market share, says Sucharita Mulpuru of Forrester Research. (E)

– The Torah teaches us that it is the intent of our actions that determines our morality not their consequence. (E)

– I liked this cart that triangulates Crime Rates in the USA and UK and proves that crime has DECLINED in the past 10+ years:

– Awesome insight! (as seen in an Ad in the Economist)

 

– ALFRED HITCHCOCK once compared television to indoor plumbing. “It didn’t change people’s habits,” said the master of cinematic suspense. “It just kept them inside the house.”

– Each young American who subscribes to pay-TV will probably spend around $40,000 over their lifetime in subscription fees, says Laura Martin of Needham, an investment bank. (E)

– From Japan to Estonia, property and people are now safer than at almost any time since the 1970s (E)

– In 1990 some 147,000 cars were stolen in New York. Last year fewer than 10,000 were. (E)

– One in every hundred American adults is now in prison. To keep each one inside costs taxpayers $47,000 a year (about the same as a place at Stanford University).

– NO ONE denies that America’s tax code is a mess. It is unintelligible, which is why 90% of taxpayers use an accountant or commercial software to file their returns. The 6.1 billion hours Americans waste each year complying with tax rules could have been spent inventing new products. Exemptions promote unproductive activities, such as buying big houses, while high rates penalise work and drive companies abroad. (E)

– How do Brick & Mortar retailers review their daily business? This is one actual dashboard:

– Nowadays, according to a Harris Poll, 38% of adults 30 to 39 have tattoos, as do 30% of those 25 to 29 and 22% of those 18 to 24. Inked women slightly outnumber men. By comparison, only 11% of Americans 50 to 64 say they have tattoos, a number that drops to 5% for Americans 65 and older.Why the proliferation of body ink? Twenty-five percent say tattoos make them feel “rebellious,” like growing long hair back in the 1960s, while 30% say that they make them feel more sexy, 21% more attractive or strong and 8% more intelligent. Meanwhile, 45% of Americans without tattoos believe those who have them are less attractive, while 39% say they’re less sexy and 27% less intelligent.Of course, you could always cut your long hair if you got tired of it or faced an unexpected court date. Getting rid of a tattoo is not so easy, though 86% of tattoo bearers said that they have never regretted their decision, perhaps belying the idea that the younger generation has commitment issues.

– Asked about the latest consumer durable, many men (in the 1960’s in Britain) said, “I don’t need one, my wife is my washing machine.” (E)

– IN THE late 1700s William Playfair, a Scottish engineer, created the bar chart, pie chart and line graph. These amounted to visual breakthroughs, innovations that allowed people to see patterns in data that they would otherwise have missed if they just stared at long tables of numbers. (E)

– In recent years the London-based daily newspaper has promoted a new area called “data journalism”. The idea is that reporters must interrogate both people and databases in order to get their information. (E)

– On June 27th the lower house approved an amendment to a consumer-rights bill that will force restaurants to label the dishes they prepare from fresh ingredients in their own kitchens as “fait maison”, or “home-made”. (E)

– The French are known to prize good food. But almost a third of all restaurants serve dishes prepared largely or entirely elsewhere, says Synhorcat, a big group of hotel- and restaurant-owners (E)

– THE first iPhone went on sale on June 29th 2007. (E)

– Taiwan, once a maker of soft toys and umbrellas, has long been a high-tech hive. It provides a rare example of successful industrial policy (though much more so in hardware than software). In 1973 the state created the Industrial Technology Research Institute (ITRI) to nurture the tech industry. ITRI started with semiconductors, securing the transfer of old technology from RCA, an American company, in 1976. In 1983 ITRI developed a clone of the IBM PC. Seven years later it formed an alliance of notebook-PC companies. Information and communications technology now makes up one-third of GDP. (E)

– Around half of steel output is used in construction (E)

– BOTH relief and tears will greet the results of France’s school-leaving baccalauréat exam on July 5th. With breathtaking efficiency, the entire country’s exam papers are corrected and marked within just two weeks. This year the papers seem particularly revealing of how French youngsters are taught to view the world. “What do we owe to the state?” was one essay option in the philosophy exam. In another textbook, a chapter on “social justice” asks: “Do high revenues threaten fairness?”(E)

– France excels at producing top-rate academic economists. But high-school teaching of economics is uneven. The IREF study last year showed that, in one tome’s 382 pages, only 18 were devoted to business. “Entrepreneurs and business leaders are almost absent,” noted the report, and “globalisation and free trade are treated with distrust.” The curriculum remains heavily tilted towards social conflict. The analysis of social structure starts with Marx. (E)

– Asked by a colleague why the loan he sought was for €7 billion ($10.3 billion), John Bowe, then Anglo’s head of capital markets, explained that the figures were picked “out my arse”. The bail-out strategy to be adopted was simple, but devious: to get the central bank to provide an initial loan that would, in effect, commit the government to further payments as needed. “You pull them in,” he said, “you get them to write a big cheque, and they have to support their money.” (E)

– BARACK OBAMA was raised by his grandparents for part of his childhood. He remembers his grandmother as being “tough as nails”. Clarence Thomas, a Supreme Court judge, was raised by his grandparents because his mother could not make ends meet. He called his grandfather “the greatest man I have ever known”. Grandparents have always reared children when need arose. (E)

– Of the 75m children in America, 5.5m live in households headed by grandparents, a number that has risen by almost a million since 2005, according to the Census bureau.

– 39m Americans currently owe the government a collective $1 trillion in student debt. (E)

– “I LEFT in 1980 with only three dollars in my pocket,” recalls Li Sanqi. He was one of the first allowed to study overseas after the dark days of the Cultural Revolution. Like most in that elite group, he excelled, rising to a coveted position at the University of Texas, while launching several technology firms. Mr Li seems the perfect example of a sea turtle, or hai gui (in Mandarin, the phrase “return across the sea” sounds similar to that animal’s name), long applauded in China for bringing back advanced skills. (E) (Alok Note – Mobile2win China was rescued in the end, rebuilt and sold to Disney by Nick Zhang – a Sea Turtle)

June 2013:

– The first big cyber-attack dates back to 1986, when a bunch of German hackers in Hanover, working for the KGB, sneaked into American military networks. Named “Cuckoo’s Egg”, it was caught only because a sharp-eyed official noted a tiny 75-cent billing error, revealing unauthorised use of a computer network. One especially damaging operation involved the theft of top-secret material from the most classified NATO networks. The attackers had used infected memory sticks, which were left lying around in car parks near sensitive buildings. Careless or thrifty officials picked them up, and some used them to copy material between classified computer networks and those connected to the internet. A clever bit of software then copied, encrypted, compressed and dispatched the material—probably, spooks think, to Moscow. (E)

– Twice as many Indian children (43%) as African ones go hungry. Prejudice kills on an immense scale: as many as 600,000 fetuses are aborted each year because they are female. (E)

– In the USA, Mortgage costs relative to annual incomes are still extremely low (around 17% compared with a historic average of almost 24%), so there is scope for mortgage rates to rise further without choking off the nascent recovery. (E)

– The greetings-card industry, which studies social trends carefully, is a useful window on changing manners. (E)

– The Khan Academy, a creator of online tutorials widely used as a form of home tutoring, is beginning to provide hard evidence for why it is considered one of edtech’s rising stars. At Oakland Unity, in tough inner-city Oakland, test scores for 16-17-year-olds in algebra and geometry have risen significantly in the two years since Khan courses were introduced. (E)

– Apple says it sold 3m iPads to American educational institutions last year

– Velcro is a combination of velvet (velours) and hook (crochet) in French. Employees are taught “You need to always use it as adjective, never as a verb and never as a noun”. (F)

– Tips on selling to 19 year old girls from Jeff Rubin (CEO of It’Sugar – the hottest new successful biz in confectionary):

  • He defines attitude as ‘rebellion’
  • Dont try to conceal the vice – revel in it

The company generates 1000$ per sq. foot in revenue in the Mall of the Emirates in Dubai – placing that metric as amongst the top 10 in the world. (F)

– Peter Thiel has a 2 year fellowship that past 100K US$ (approx 60 lacs) to students who skip college or drop out to pursue their startups as long as they dont sneak back into class. (F)

– Vinod Khosla told a conference “people over 45 basically die in terms of new ideas”. (F)

– From Japan whose Economy and sentiment is perking up, a consumer says “I don’t really need it, but I want it,” he said. “A good economy means you can buy things you don’t really need.”

– “We’ve seen confidence start to explode over the last months,” said Herbert Appleroth, chief executive of Ferrari Japan. “We’re seeing some of the highest growth in the world here.”

– The United States built its lead in Internet Connectivity because companies invested nearly $1.2 trillion, over 17 years, to deploy next-generation broadband networks. These investments, which began with the passage of the Telecommunications Act of 1996, were neither accidental nor inevitable; they were a result of deliberate policy decisions by Congress and by Democratic and Republican administrations alike to protect consumers while encouraging companies to invest in nascent technologies that are now flourishing. 80 percent of American households enjoy 100 megabits per second speed

– With youth unemployment running at 35% in Italy and annual net pay for a young leather-cutter starting at around €18,000 ($24,000), fashion firms ought to have applicants beating down their doors. Like people in other rich countries, Italians tend to look down on manual work, however skilled, and families prefer to push their children towards careers in the professions and the public sector. The education system, at all levels, generally provides a poor preparation for working life. Italian universities are full of youngsters studying subjects in which they are not interested but which their parents think are good, regardless of the job prospects. (E)

– The ‘recipe’ for making cement has not changed for hundreds of years.Cement is so costly to transport that it rarely travels more than 200 miles (320km) by road, so its markets tend to be local. Barriers to entry are high: a new cement works producing 1m tonnes a year, the smallest worth building, costs around $200m. (E)

– How cyber attacks started : Teenage pranksters in the 1990s used DDoS attacks to boot enemies from internet chat rooms. (E)

***

– Long-term, “the digital download is going to be like the cassette,” predicts Russ Crupnick of NPD Group, a research firm. (E)

– Facebook, which lacks maps of its own, was said to be close to a deal. Talks reportedly failed because Waze’s team did not want to move to California. (E)

– Only 3% of Britons used one (Classic Red Phone Booth) to make a phone call in the past month, according to BT, the country’s biggest telecoms firm. (E)

– A five-year-old Boeing 737 costs $180,000 a month to lease, in Europe (E)

– Managers who rely too much on their strengths may become hammers that see every problem as a nail. Over-forceful bosses can turn their subordinates into patsies; consensus-obsessed bosses can institutionalise dithering. It is not difficult to find examples of strengths-turned-weaknesses in politics. Barack Obama’s talent for lofty rhetoric has distracted him from the nuts and bolts of policymaking. François Hollande’s passion for being Mr Normal has rendered him too small for his grand office. (E)

– One result is that leaders end up micromanaging their subordinates (particularly those doing the job that they used to do) and neglecting the big picture. It often makes bosses choose to do the wrong thing well rather than the right thing poorly. One reason for the 2007-08 financial crisis was that the heads of big investment banks and brokers had often made their reputations as traders, rewarded for taking big risks rather than managing for the long term. Examples include Dick Fuld of Lehman Brothers and Jimmy Cayne of Bear Stearns. (E)

– Among the solutions offered by Messrs Kaplan and Kaiser is for bosses to create feedback mechanisms that tell them when they are going over the top (one “over-talker” got a friend to hold up a sheriff’s badge if he was talking too much in business meetings). (E)

– ODesk was the matchmaker for 35m hours of work in 2012 (over 50% more than in 2011), divided between 1.5m tasks, at a total cost to the employers of $360m. The value of work on Elance rose by 40% in 2012 to exceed $200m for the first time. Last year the value of this sort of online work topped $1 billion for the first time; it will double to $2 billion in 2014, and reach $5 billion by 2018, forecasts Staffing Industry Analysts, a “contingent work” consultant.

– “You talk to a mathematician, and he tells you that he’s one in three people in the world who understand the problem and it’s not been solved for 200 years,” says Mr von Ahn. “A computer scientist says: ‘I solved an open problem yesterday’.” MUST READ Interview and article of the man who invented CAPTCHA

-Redundancy, resiliency and adaptability, plus human ingenuity, keep distant hardware going. Must read this article on HOW TO FIX THINGS IN SPACE

– Of the 7 billion people alive on the planet, 1.1 billion subsist below the internationally accepted extreme-poverty line of $1.25 a day. America’s poverty line is $63 a day for a family of four. In the richer parts of the emerging world $4 a day is the poverty barrier. But poverty’s scourge is fiercest below $1.25 (the average of the 15 poorest countries’ own poverty lines, measured in 2005 dollars and adjusted for differences in purchasing power): people below that level live lives that are poor, nasty, brutish and short.

– Cuba’s governmentsaid it would allow ordinary Cubans to access the internet for the first time, but for a pricey $4.50 an hour. The average monthly wage is $20.

–  But in reality most people still get their news from TV.” That’s true not just in Russia, where perhaps 80 per cent do, but even in the US. Russian newspapers are comparatively tiny: few sell more than 100,000 copies, a figure representing under 0.1 per cent of the population. (FT)

– Jobs was so persuasive that he could claim the sun was setting when it was actually rising, and everyone would nod in agreement.(NYT)

– Snippets of Interview with Yousendit CEO :

One thing I started doing was to send out every Sunday night an e-mail to the whole company. The e-mails aren’t particularly structured, and they might be on all kinds of topics, like what’s really going on with our monthly results.

But I’ve also been in companies where the communication increasingly became non-communication — where the C.E.O. would do an all-hands meeting, and at the end of it I would be wondering: “What did they just say? I don’t even know what that meant.”

Q. How do you hire?

A – The thing I look for more than anything else is passion.

One of the questions I love to ask is, “How would your friends describe you in college?” And then they’ll say a few words, and then I’ll say, “All right, so after you graduated from college and started working, how would your first group of colleagues describe you?” I think you get more real answers that way than if you say, “Hey, describe yourself.” You definitely see some evolution as people mature.

My dad told me at a relatively early age about this idea of “take the professor, not the class,” meaning just seek out the best professors, whatever they’re teaching. And the idea of taking the professor, not the class, applies to your professional life, too. (NYT)

MUST READ this incredible interview!

– “I think of Xbox as the accidental success out of Microsoft,” said James McQuivey, an analyst at Forrester Research 

– Alex St. John, an entrepreneur who worked on Microsoft’s pre-Xbox game efforts, says he is pessimistic about prospects for gaming consoles.

“They’re coming out with the latest and greatest stone tool,” Mr. St. John said. “The new console that trumps the old console is called the Apple iPad. This generation of kids loves mobile games.”

– The median home price in America (excluding new builds) was $192,800 in April, a rise of 11% since April 2012, according to the National Association of Realtors.

May 2013:

– Back in 2010 Mark Zuckerberg made a very bad decision. Instead of building separate apps for iPhones, Androids, BlackBerrys, Nokia devices, and, yes, even Microsoft phones, he put his engineers to work designing a version of Facebook that could operate on any smartphone. In effect, he was betting that as different operating systems jostled for control of mobile devices, standalone apps would go away and soon we would surf websites on our phones, just as we do on PCs.

Zuckerberg was wrong. Android and iOs quickly became the dominant mobile operating systems, and Facebook’s applications, which were built with its CEO’s web-centric worldview in mind, didn’t work well on either platform. They were buggy and slow, crashing often. A 2011 update garnered 19,000 one-star reviews in the Apple App Store within the first month. “It’s probably one of the biggest mistakes we’ve ever made,” (F)

– Zuckerberg demurs when I ask him how the IPO has changed Facebook. “We made this transition to being a public company, and at the same time we made this transition to being a mobile company,” he says (F)

– The status of professionals in North Korea : Doctors can make drips out of beer bottles, but know nothing of the modern pharmacopoeia. The typical history teacher, Mr Lankov says, “knows a lot about events that never actually happened”. (E)

– AFTER a Soviet missile shot down a South Korean airliner that strayed into Russian airspace in 1983, President Ronald Reagan made America’s military satellite-navigation system, GPS, available to the world. Entrepreneurs pounced. Car-navigation, precision farming and 3m American jobs now depend on GPS. Official weather data are also public and avidly used by everyone from insurers to ice-cream sellers. (E)

– The cynical view is that managers are vain and hate to admit mistakes. Investors usually decide an acquisition has gone bad within a year or two. The buyers’ shares drop. It takes longer for the accounts to catch up. Auditors should subject balance-sheets to a yearly impairment test, but valuations are subjective and executives can twist their arms. When the auditors do, at last, assert themselves, companies are often blasé. The typical lag between error and admission seems to be about five years. Take the top 3,000 firms listed worldwide. In the boom of 2004-07 takeovers were at a peak, and write-offs were minimal at about $30 billion a year. Impairments surged to $150 billion in 2012, according to Bloomberg data. (E)

– So what does Tata’s write-down (Of Corus) signify? Ratan Tata, the patriarch of the Tata group, retired as chairman of Tata Steel on December 28th. Until he left it was probably impossible to recognise that Corus, his biggest deal, was a flop.

His successor, Cyrus Mistry, has several underperforming businesses to deal with. Yet Mr Mistry has opted for a small write-off. Corus, analysts estimate, is worth a third or less of the $13 billion Tata paid for it, meaning the impairment should be much bigger. (E)

– Previous activist investors seeking to crack Japan have fared only slightly better than the Christian missionaries of the 16th century (who were crucified). Locals assume that their goal is short-term profits, rather than better management. Steel Partners, another American fund, tried for years to reform corporate governance at Sapporo Holdings, a brewer. It failed. Cerberus Capital Management is still attempting to win more sway over Seibu, a hotels-to-railways-to-baseball conglomerate it first invested in back in 2006.

As a globally minded firm, Sony may be more inclined to listen to outsiders. This week it said its entertainment assets were not for sale, but it welcomed dialogue with shareholders. (E)

– Dominique Turpin, the head of IMD, a Swiss business school, writes that “the CMO is dead”. (E)

– With new digital tools marketers can reach the likeliest customers when they are most in the mood to buy. Last summer Wall’s ice cream and O2, a mobile-phone network, teamed up to send advertisements to Londoners’ smartphones when temperatures climbed. When the weather cooled Kleenex, a brand of tissues, used Google search terms and health-service data to target ad spending to areas likely to suffer the most sneezes. (E)

– MarketShare touts the case of Electronic Arts, which was spending too much on television and cinema advertising and not enough on search advertising and YouTube videos to promote its “Battlefield” video game. After cutting television’s share from 80% to half and boosting spending on video and paid search, sales of the new version jumped by 23%. (E)

– Already 70% of big American firms employ a “chief marketing technologist”, says Gartner. (E)

– Somali piracy (which, according to a recent World Bank report, may at its peak have cost the world up to $18 billion a year in extra shipping expenses and lost trade)  (E)

– Between 1994 and 2012 the number of licensed motorcycles in Britain jumped by 70%. Cars increased by just 35% over the same period. They are popular for several reasons. Smaller engine capacities mean more miles per gallon at a time of high petrol prices. The vehicles are cheap, around £3,000 ($4,600) for a new one.

A full motorcycle licence is not needed. Insurance is also cheaper. The bikes might replace a second car, says Steve Kenward of the MCIA, or they may be used by first-time motorists.The new popularity also points to a wider money-saving trend. In pinched times, motorbikes are valued more for their usefulness than their speedy glamour. Many of the riders on these mid-range models are commuters. (E)

– IN “SOAPLAND”—Sopurando, a Tokyo red-light district—the price of a basic half-hour “massage” has recently gone up for the first time since 1990. Demand for the top-end, “highly technical” massage service, costing ¥60,000 ($600) a go, has also been soaring, according to Akira Ikoma, editor of My Journey, which covers the sex industry. He says it is all thanks to the surging stockmarket. (E)

– Mr Abe (the Japanese Prime Minister) refers to his monetary, fiscal and growth strategies as his “three arrows”. The reference, understood by all, is to an old legend from Yamaguchi, the southern part of Honshu and the region from which Mr Abe hails. The legend has it that a lord asked his three sons to snap an arrow, which each of them duly did. He then produced three more arrows and told the boys to snap all three at once. None of them could. One arrow, the father said, can easily be broken. Three arrows together, like a bundle of birch rods, cannot. It was an exhortation to work together for the good of the clan. (E)

– Mr Abe is a man who learned better. They say his years in the political wilderness transformed him. He educated himself, especially about economics. He resolved to avoid needless historical distractions. Residual displays of nationalism are just tokens of gratitude to old friends who held faith with him after his resignation. Economics trumps all now. (E)

– After two lost decades, the Japan’s nominal GDP is the same as in 1991, while the Nikkei, even after the recent surge, is at barely a third of its peak. (E)

**

How St Goran – a ‘Model’ hospital in Sweden works:

– St Goran’s is now a temple to “lean management”—an idea that was pioneered by Toyota in the 1950s and has since spread from carmaking to services and from Japan to the rest of the world. Britta Wallgren, the hospital’s chief executive, says she never heard the term “lean” when she was at medical school (she is an anaesthetist by training). Now she hears it all the time.

– The hospital today is organised on the twin lean principles of “flow” and “quality”. Doctors and nurses used to keep a professional distance from each other. Now they work (and sit) together in teams. (Goran Ornung, a doctor, likens the teams to workers in Formula One pit stops.) In the old days people concentrated solely on their field of medical expertise. Now they are all responsible for suggesting operational improvements as well.

– One innovation involved buying a roll of yellow tape. Staff used to waste precious time looking for defibrillator machines and the like. Then someone suggested marking a spot on the floor with yellow tape and insisting that the machines were always kept there. Other ideas are equally low-tech. Teams use a series of magnetic dots to keep track of each patient’s progress and which beds are free. They discharge patients throughout the day rather than in one batch, so that they can easily find a taxi.

St Goran’s is the medical equivalent of a budget airline. There are four to six patients to a room. The decor is institutional. Everything is done to “maximise throughput”. (E)

**

– The average return on equity for the world’s 13 largest investment banks may fall to 6-9% by 2017. This is well below the cost of equity (E)

– Few firms are good at recognising their own flaws (which helps to explain why only one company from the original Dow Jones Industrial Average of 1896 is still on that list: General Electric). (E)

– Henry Ford was so allergic to evidence that America was falling out of love with the Model T that he dismissed sales statistics as fakes and fired an executive who warned him of disaster. (E)

– In “The Innovator’s Dilemma”, Clayton Christensen of Harvard Business School argues that companies are often doomed not by their failures but by their triumphs. They may realise that the world is changing. But they are so good at doing what they have always done—making mainframe computers in IBM’s case—that they make a hash of embracing the new.

–  McKinseyites are said to be “vainies” (who come and lecture clients on the McKinsey way). BCG people are “brainies” (who spout academic theory). And the “Bainies” have a reputation for throwing bodies at delivering quick bottom-line results for clients. (E)

– It is fashionable to complain that consultants “steal your watch and then tell you the time”, as one book put it. (E)

–  About 85% of India’s jobs are with “informal” enterprises—those organisations with fewer than ten staff which are not incorporated. Another 11% are casual jobs with formal companies. Only 16% of Indians say they get a regular wage. People with informal jobs are usually very poor. An official study of 2004-05 data concludes that 80% of informal workers got less than the then national minimum wage of $1.46 a day. (E)

–  One shipping boss thinks logistics add 20% to the cost of making something in India, compared with 6-8% in China. (E)

– Dylan Grice at Edelweiss, a fund manager, notes that last year 12 of the 50 richest Americans listed by Forbes magazine were financiers, asset managers or investors. In 1982 not one person on the list worked in finance. (E)

– Of the millions of homes being financed (during the S&L crisis), a worrying proportion was bought by people who had no hope or intention of repaying their loans. (E)

****

Warren Buffet! Pointers (WSJ)

– work as hard as possible to find someone who rejects your philosophy & proves you wrong.

– when 2 intelligent people disagree (called thoughtful disagreement), it generates learning & momentum to move ahead..

Specific to stock markets:

– oldest but most ignored saying “don’t confuse brains with a bull market”


– biggest mistake in investing is the failure to distinguish something that’s become more expensive vs. something that’s still a good investment !! (WSJ)

****

– Since it debuted in London 27 years ago “The Phantom of the Opera”, a musical by Andrew Lloyd Webber, has grossed $5.6 billion worldwide, more than any film or television show (even More than Star Wars) !! (E)

– Mathematicians had been wondering how many colours it would take to ensure that, no matter how complex a map, no adjacent countries would be the same colour. It took mega computers & years to find the answer = 4 colours (E)

– The number of young people out of work globally is nearly as big as the population of the United States (E)

– McDonald’s is one of Britain’s biggest trainers. It gets about 1m applicants a year, accepting only one in 15, and spends £40m ($61m) a year on training. The focus is on practicalities. A retired policeman conducts a fast-paced class on conflict management. He shows a video of a woman driven berserk by the fact that you cannot get chicken McNuggets at breakfast time. He asks the class if they have ever had a difficult customer, and every hand goes up. Students are then urged to share their advice. (“Serve drunks quickly…”). (E)

The company professes to be unfazed by the fact that many alumni will end up working elsewhere. (E)

– In the first quarter of 2013 Apple reported revenue of $43.6 billion: an 11% increase compared with the same period in 2012, and a figure that exceeds the combined sales of Google and Microsoft. (E)

– Real life situation in the USA DMV (Our RTO) office – IN 2002 the columnist visited the Department of Motor Vehicles (DMV) in Washington, DC, to renew his driving licence. The queue moved at a glacial pace. The staff alternated between hostile and indifferent. There were lengthy forms to fill in, six documents to produce, confusing instructions and, hanging over everything, the warning that any false answer is a crime. One man said he had sent his paperwork by fax only to be told that the DMV does not accept faxed documents. Then why do you provide a fax number, he asked? “We do it as a courtesy.” (E)

– TO MOST people, bumblebees are charming, slightly absurd creatures that blunder through garden and meadow with neither the steely determination of the honeybee nor the malevolent intention of the wasp. If you are a plant, though, things look rather different—for from the point of view of some flowering plants many bumblebees are nothing more than thieves. They rob them of their nectar and give nothing in return.By breaking in in this way, though, a bumblebee nullifies the 100m-year-old pact between flowering plants and insects: that the plant feeds the insect in exchange for the insect pollinating the plant. (E)

– One of Rolls-Royce’s stories is that three-quarters of the cars the company has ever produced are still on the road !! (E)

– A POKER face. It is the expressionless gaze that gives nothing away. To win at poker, the face must be mastered, and master it is what the best players try their best to do. But a study just published in Psychological Science by Michael Slepian of Stanford University and his colleagues suggests that even people with the best poker faces give the game away. They do so, however, not with their heads but with their hands. (E)

March 2013:

****

Eric Schmidt (Google Chairman) meeting in Delhi (Nasscom)

Notes on Eric Schmidt Nasscom meeting – Delhi – 20.3.2013

– Don’t discount luck!!
– Get people smarter than u
– People underestimate the opportunity
– indian telecoms don’t have enough capital :-))
– 40% of Silicon Valley Startups have indian founders!
– Laws in India should be changed. That’s what indian govt should do
– mobile is the next big thing!!! BUILD APPS!!!!
– YouTube does well in India despite bad bandwidth !!
– whatever you do, try and expose your API so that others can build on it
– google has changed ad units to suit new behavior
– people are addicted to their phones
– Eric doesn’t like software patents :-)))
– a software architect can make markets transparent – but protected markets like art don’t want them!
– he learnt how to manage CASH 
DNROOC = do not run out of cash 🙂
– find people as co-founders who you can have non egotistical arguments with!
– Larry focuses on recruiting 
– google acquires companies for talent!
– envy, greed, wealth drive market creation!
– great leaders can see what’s gonna happen AND COMMUNICATE what they see
– entrepreneurs are BORN 🙂 difficult to train
– it’s very tough to get a job at google…
– smart people respond to appeal! 
– in business school, the mistake is to emphasize on money
****

 

Also check out – Part 2 of the Notes here! 

****

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