6 AM Pacific

Leadership Challenges – the Fog of Economics

Think like a wise man but communicate in the language of the people.

- William Butler Yeats

The world’s biggest issues today are economic issues. They are about growth, inflation, unemployment, income distribution and so on. Many other issues are not directly about economics but are indirectly so - like climate change or immigration in the US. Even terrorism ultimately is linked to economics – people with nothing to lose are easy prey for those who preach hate.

As the world’s governments deal with these thorny economic issues, they face many challenges. The one that is peculiar to economic issues is that most voters don’t understand the economics behind these economic issues. More »

The difference between KBC and a lottery

“Kaun Banega Crorepati” (KBC), India’s version of “Who Wants to be a Millionaire” is watched by between 15 and 20 million Indians. In parts it is great entertainment. But a part of it is pretty darned close to a lottery.
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The Napsterization of Sell-Side Research

Cross-posted on the Gridstone Blog.

Candace Browning, Head of Research at Merrill Lynch posted an open letter last week that talked about the “Napsterization” of sell-side research, justifying why Merrill Lynch would have to take control of the distribution of their research. More »

Offshore Backlash Redux

It’s back. With the Democrats in Congress and soon perhaps in the Whitehouse and an economy that most think will turn sour soon, it is almost the perfect storm. Trade in services, fondly called “offshoring” is back on the front pages and it bodes ill for global business. More »

Mumbai Taxis

I am in India on a 2 week trip.

On the ride from the airport to Malad, I get to understand why the Mumbai taxis are the way they are, from my driver. For those of us who have had their bones rattled in a Mumbai taxi, this will tell you why. It won’t hurt less when your head bangs into the roof of the cab, but at least you can nod wisely because you know who to blame. More »

Open Letter to the Bollywood Music Industry

Dear Mr./Ms. Music Executive,

First of all, let me compliment you on your pricing strategy so far. You have aced the test on how to price information products. Information products like music are tricky - the content is all in digital form, the fixed costs are high and marginal costs approach zero. How do you price such a thing?

Your current strategy seems to be working well. You have segmented the market according to the listeners’ ability to pay. To each segment you offer a different product (or sometimes the same product) at vastly different prices. I checked prices at different places for the same album – Don. Here’s what I found: More »

Land Acquisition: Big Hurdle for Indian Manufacturing

As Mamata Banerjee enters the 21st day of her fast over the ‘forcible acquisition of farmland’ in Singur for a Tata Motors factory, one pauses to reflect upon one of the biggest hurdles that faces heavy manufacturing in India – land acquisition. What started with Narmada Bachao Andolan is now reaching fever pitch. And it is going to get worse before it gets better. More »

The Rise and Rise of Private Equity

This week rumours were rife about what could be the biggest private equity deal ever – the buyout of Home Depot. The company later quashed the rumours that they were talking to private equity firms.

These are sweet times for private equity. The deals are bigger and more numerous. Capital is easy to raise. So is debt, that is needed to leverage the buyouts. A recent Fortune article paints a very rosy picture of the private equity business. Here’s a different perspective on it from NPR (audio).
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FDI Controls in India - what are they really about?

From time to time you hear some government minister or bureaucrat in Delhi making a proclamation that the FDI limit (Foreign Direct Investment) on such and such industry has been raised from X% to Y%. The press dutifully covers it, the Communist parties huff and puff about it and another credit is chalked up on the Indian government’s liberalization scoreboard. But most people like me, remain uninformed about the issues behind the decision. More »

Indian Public Services - Crying for Change

An article on the Indian Postal Service in the Wall Street Journal (subscription required) portrays the service so pathetically, it almost reads like a children’s book describing a distant kingdom where everything goes wrong all the time. Unfortunately, this is no fairy tale. It is very, very real.

Here are some damning stats and facts about Indiapost: More »