18 July, 2014

Has the world gone mad ?


I think it has. Nothing but madness can explain the awfulness of the last few days.

The downing of the Malaysian Airlines plane over Ukraine is one of the sorriest events to ever happen. Two bunch of loonies are fighting over God knows what - yes Russia is meddling in Ukraine, which as a country has almost ceased to exist and everybody is bent on killing everybody else. But to shoot a civilian airliner that was simply overflying the country ??? What sort of a nut case or , in reality a group of nut cases wants to shoot that down ? For what ? What did the poor people who just had the misfortune of being in that plane do to deserve this. Reports say a large number of them were actually flying to Australia for an AIDS conference. Some of the leading AIDS researchers have been lost to the world. What a senseless tragedy.

Consider the situation of Malaysian Airlines. What have they done to deserve the double whammy over the last few months. It is now difficult for them to even survive.

And then, there is Gaza. Some terrorists kidnapped some Israeli boys and in retaliation some Palestinian boys were killed. Look at how this has escalated. Terrorists from Gaza are firing every rocket they can at Israel. Israel reacts by meting collective punishment to the entire population of Gaza. Hundreds of innocent lives have been lost, almost entirely Palestinian. Its the poor ordinary folk who are suffering miserably. Very little of sanity seems to exist in that place. John Kerry must be tearing his hair out - against all odds he has invested every ounce of energy he has to make some movement in the peace process. And this is what has happened.

Simply because it has been going on for so long, the awfulness of what is happening in Syria, and its spillover into Iraq is taking third place in this dubious list. Every maniac, criminal and lunatic seems to be there killing everybody else. The innocent civilian suffers, and suffers miserably.

In my own home city, a few hundred metres from where I live, a six year old girl is raped in school  by some staff. A six year old for God's sake.

Today is a day to seriously ask whether the world has gone mad. Amidst this mayhem, matters of business and economics seem almost insignificant. If there are sane people left in this world, hopefully the vast vast majority of us, we should rise and exterminate the madmen. This isn't a rational response, but in today's insanity, little else can be said.

I pray for all those in torment today.

03 July, 2014

Burn the green card !

Beware, if you are a US citizen, or a green card holder,  living abroad. FATCA is on you !

FATCA stands for the Foreign Account Tax Compliance Act and is the latest weapon unleashed in the awful American tax code. On measures of awfulness, FATCA must be a contender for one of the worst pieces of legislation ever passed. It takes America's unilateralism - something this blogger has long railed about - to a new level.

Basically FATCA is an imposition of its tax laws on every financial institution in the world, wherever they may be. Every bank, even in Timbuktu, is required to report to the US authorities, details of bank accounts and transactions of all US persons (citizens and green card holders). If they fail to do so, they would essentially barred from doing any business in the US. Terrified of being shut out of US markets, almost every country of any standing has signed bilateral agreements with the US to this effect. Did I mention the word, bully ?

All this arises from the stupid concept that prevails only in  America, and in no other major economy in the world. America taxes its citizens on global income, even if they lived entirely abroad and earned all their income abroad. So such citizens pay taxes in the country where they live in AND to Uncle Sam.  In every other major country, depending on your residency, you are taxed on where the income arose only; not on global income.

The ostensible reason for FATCA is to go after US citizens who are hiding their income overseas and avoiding taxes. While that may be a fair objective,  it suffers from two major flaws - the first that you want to tax global income and second that you are simply trampling on every other country, just because you have the capability to do so.

FATCA came into effect three days ago. It will have major ramifications for anybody connected to the US, but living abroad. Consider the question of privacy. America requires every country to report transactions, irrespective of  the country's privacy laws. And yet if the same country turned back to the US  and asked it to report similar data for its nationals, the US will tell it to go away citing privacy considerations. Did I mention the word hypocrisy.

All sorts of unintended consequences are emerging. Some US citizens living abroad are considering surrendering their US citizenship. The rate of surrender, though still small, has quadrupled since FATCA came on the horizon.  Some foreign banks are basically telling US citizens  to go away and not have accounts with them - they simply don't want to get squashed by the strong arm of the US. Some employers overseas are turning away US citizens, considering them not worth the bother.

Consider the US green card holder living in India. Many take this only to escape the brutal visa regime. Parents of children now living in the US maybe. Now they are caught in the FATCA net.

This blogger is reminded of a famous cartoon in The Economist many years ago. The Economist was commenting on how desirable the US green card is even for ostensible haters of the Great Satan. The cartoon featured a rabid mullah, yelling Death to America in a protest somewhere in the Middle East - and he whispers as an aside to an American journalist - "Can you get me a green card "!

Maybe the time has come to change the punchline. Can you burn my green card !

23 June, 2014

Yo

A mobile phone app start up has received $ 1 m in funding. Nothing special about that - after all thousands of start ups get funding. What is interesting is the nature of the app itself. It is called Yo. And what it does is that you can send a message - Yo - to any of your friends. That's it. That's all you can say - Yo. Apparently its USP is that you can say Yo in two taps instead of the 13 taps it will take you in Whatsapp.

 I am scratching my head in bewilderment. Why would I want to say just Yo to you ? In comparison, Twitter seems positively garrulous. Yo is being downloaded like there is no tomorrow - it has reached the top 50 downloaded apps on the Apple store. For some strange unexplained reason, iphone users want to say Yo more than Android users !

Apparently this is the start of something called "contextual communication" ! If a world cup match is going on and you send a Yo, it means - Dumbhead; somebody has scored a goal; turn on the TV and watch it. If you get a Yo from your boss, it could mean get your ass up here right now, or don't be playing that game on your PC - get to work. Depending on the "context", you see. Wow. 

This brings me to the whole apps mania. Apparently iOS is good because it has 1.2 million apps. I am absolutely sure that 1, 999,950 of them are utterly useless and inane. Honourable mention must be made of
  • Pimple Popper - a game apparently
  • Places I’ve Pooped - Globally with Google maps integration
  • Drunk Dial No - which very helpfully prevents you calling somebody when drunk by disabling your contact list
  • Paper racing - contest on who can roll up toilet paper fastest
  • Tap that - It helps your phone do , er, "it" with another phone !
Not sure if Yo falls in this category, but I would suspect Indian politicians might want to give it some close attention. The current breed of politicos all have taken to Twitter with a vengeance, trivialising complex and major issues much to this blogger's irritation. Worse still, the irresistible Tweet button is extremely prone to foot in the mouth disease. If instead, they simply said Yo, well, there is no problem, is there? By "contextual communication" you can interpret it in whatever way you want. And the foot in the mouth politician can of course deny that he never meant it that way.

Amongst those cheering this app must be the Indian telecom companies. You see, contextual communication was discovered long long ago in India courtesy the "missed call". You simply gave a missed call and the receiver understood what you meant. Telecom companies are furious at this practice because they earn absolutely nothing from this. Instead, if your driver switched to Yo to ping you that he has arrived, well, the Indian telco would earn some revenues courtesy the pingers needing to use data connectivity. I strongly suspect Airtel or Idea might be behind the $ 1m financing to this start up !

In the new world of Yo, I suppose this rather verbose blog is an anachronism and this blogger a dinosaur. Perhaps he would go the dinosaur way and become extinct. Yo !


16 June, 2014

Money can't buy everything


If you nodded your head saying money can't buy love, that wasn't what I meant ! After all this is a business blog and starry eyed affairs of the heart seldom feature here !!. Money can't even buy the thing money is supposed to be good at buying - a major sports championship.

The trigger for this post is the NBA finals that concluded yesterday. The San Antonio Spurs defeated the Miami Heat to win the "World Championship" of basketball . For the sports purist, it was a wonderful result. The Spurs played sublime basketball. They came back after a heartbreaking loss last year to win it this time around. This is their fifth championship.  But this post isn't about the sport - its about the money.

In sports, superstars make insane amounts of money as salaries. If ever there is a breed even more mercenary than bankers, it is sports stars. Salary levels are simply insane. Kobe Bryant the highest paid NBA star, earned a salary of $ 1 per second ! There are 31 m seconds in a year and that's what he earned - $ 31m in a year. Or if you prefer $ 85,000 every day. And he was injured for most of the season and hardly played - he made all that money sitting on his butt (Sriram please note !). At least Kobe Bryant is one of the world's top players. What about Amar'e Stoudamire making $ 22m. He can't even make it into his own team.

NBA salaries are guaranteed by contract - it doesn't matter if the player plays well or awfully. It doesn't even matter if he is dropped. He just banks the money. The most outrageous case happened five seasons ago and I blogged about it here. In every other field of human endeavour, pay has some link to performance. Not in most sports and certainly not in the NBA.   Player salaries inflate to obscene levels and for the contract duration it absolutely does not matter what the player does.

In this mad world of the NBA, the San Antonio Spurs stand out. Their top players take pay cuts so that the team can afford to hire good players. Their top players - Tim Duncan, Tony Parker and Manu Ginobili, have stayed together in the same team from the beginning. They could have doubled their salaries going elsewhere. They didn't and instead took pay cuts. Their coach Greg Popovich has been coaching them for 17 years. They play together as a team. They are unselfish - there are no giant sized egos. Their young rising star, Kawhi Leonard, won the Most Valuable Player award of the Finals. His salary ?  $ 1.9 m.

Now you can understand, why I am incredibly happy that the Spurs won. This is sports at its best. In a world of giant sized egos, obscene salaries, switching teams at the drop of a hat, the San Antonio Spurs represent modesty, team work and the spirit of sport. There is simply no other major team in any sport, even remotely like them.  Think of Tim Duncan. One of the greatest players the game has ever seen. He's into his 17th year - his contemporaries have long retired. He is still a great player. He takes pay cuts year after year to help the team . He is self effacing to a fault. And he just wins. He played brilliantly in the Finals. It is his fifth NBA championship. This is what sports, and a sportsman, ought to be like.

And here's another reason to love them . In the backwaters of Texas, where you would least expect it, is the most international of NBA teams. Their team consists of two Frenchmen, one Brazilian, one Argentinian, one Italian, one Australian and one Virgin Islander. Of the players who took the court in the last game only 3 were American.

All hail the San Antonio Spurs.

PS. One more reason to adore Tim Duncan. He doesn't tweet. Oh Lord; what a blessed relief :)

10 June, 2014

The job interview is a joke

It is fairly clear that I would not be able to get a job with Rockwell (a web hosting company) or the Kerry Group (food ingredients company).

This is because I would have to answer, in the selection interview,  "How would you react if you were shot in the head with a Nerf gun?" (Rockwell) or "Is a Jaffa Cake, a cake or biscuit ?" (Kerry). Since I do not know what a Nerf Gun or Jaffa Cake is, it can be safely assumed that I would flunk the interview.

The Glassdoor Blog chronicles each year the weirdest questions that companies have been known to ask in interviews. It of course makes extremely interesting reading and I would strongly recommend it instead of that useless report you are writing at this minute ! How would you answer to ""How many square feet of pizza is eaten in the US each year?" (Goldman Sachs !), or  "Can you instruct someone how to make an origami "cootie catcher" with just words?" (Living Social), or, "If you were a pizza deliveryman how would you benefit from scissors?" (Apple)

Apparently these seemingly weird questions are designed to assess "creativity" and "lateral thinking". Bullshit. Anybody who says he  can fathom creativity from an answer to a weird question in a pressure cooker artificial setting like an interview is just fibbing.

Long time readers of this blog would know that this blogger rather enjoys needling HR types. It has just been noticed that this breed has been spared a long time from good natured ribbing. So this post is to "restore the balance"!

I am of the opinion that the unified theory in astrophysics will be solved before we can fathom what goes on inside the recruitment department of a company.  As anybody who has ever sent a CV to a company knows, even black holes cannot match the disintegrating capability of a HR department. CV's vanish without a trace - has anybody ever got an acknowledgement of a CV ever ? And then by some miracle unexplained, you will get a call at 11.14 in the night requiring you to be present for an interview at 6.24 in the morning the very next day in a location 83 miles away from your home. By heroic efforts you land at the spot at 6.15 only to find that the office is locked and won't open till 9.30 AM. You hang around not wanting to miss the opportunity. At 10.00 the office is opened and you are ushered into a windowless room and told to cool your heels. Hours come and go by and you realise you have been forgotten. You timidly approach the security guard again and remind him that you have been sitting bolt upright for the last four hours without even going to the loo. He takes pity on you and promises to inform the HR department. 3 hours later a lady of gargantuan proportions barges in and orders you to proceed for an interview . You land in another room and wait for another half an hour. A constipated owl enters, mobile to the ear, and proceeds to finish a call for the next 15 minutes. Sundry suits land up. The interview is supposed to begin. The interviewers realise that they have no idea what they are interviewing for. Of course, they haven't seen your CV. They don't even know your name. They take your copy of the CV from you and start skimming. And they ask you to begin narrating your background in your own words because they are illiterate and can't read your CV.

I challenge any HR type to prove that this is not an accurate reflection of the truth.

And then, if you are asked "Can you say: "Peter Pepper Picked a Pickled Pepper" and cross-sell a washing machine at the same time?" (Mastercard), I declare that it is acceptable grounds for defence against a charge of murder !!

03 June, 2014

Yet again, the US pisses off another country

Why is it that I, an incorrigible Americophile, am ranting against the US every month in this column ? I have long admired the US, the society, the culture and, especially, the economics.  I continue to be an unabashed admirer of so much in the US. and yet readers of this blog could easily mistake me for a "burn the US flag" extremist, considering the number of times I am criticising US policy and action in recent posts.

Take the case of BNP, the French bank. Like so many banks before it, it has been caught up in investigations by the US on money laundering. The crime committed by the bank is that it routed transactions to Iran, Cuba and Sudan covering them up. Standard Chartered had a similar problem and I blogged about it here. Now it is BNP's turn. 

The problem is not the act itself (although I will question even that later). BNP admits fault, is prepared to pay a fine etc etc. The problem is the quantum of the fine - $ 10 billion - the largest fine in the history of the world and dwarfs even the BP fine for the oil spill ($4 bn) . That's a ridiculous quantum of fine, by any standards. The French are mightily pissed off. The French finance minister has termed it completely unreasonable and a diplomatic row has broken out. Obama visits Paris in 2 days and Hollande is going to raise this with all puffed up anger. This is another instance of US unilateralism. Yes, by the strict letter of the law, they can act unilaterally. A more rational way would have been to involve the French government and "negotiate" a deal. This is what happens in international diplomacy - if the shoe was on the other foot, the US would have done exactly that. In a global world, showing a finger at the French will  simply mean retaliation. General Electric can now kiss goodbye to any chance of acquiring Alstom.

Quite aside from the fine, my problem has always been the US attempt to impose its will on the world, through any means possible. There isn't any evidence that BNP actually laundered money of criminals or terrorists. What they did was do transactions with Iran, Sudan and Cuba, which is against US law sure, but is a matter of foreign policy. There is no United Nations embargo against trading with these countries - it is simply US policy. Take Cuba. Is there any rationale today for the US embargo ?? Just because the US's  nose was punched in the Bay of Pigs in 1961, is there any moral justification for an embargo 50 years later. Why should the world dutifully follow and refuse to shake hands with the Cubans. So the US dictates what is a crime and what isn't and the rest of the world simply has to follow.

Yes, I know the argument, the US is simply imposing its law on its land and every foreigner must comply. But  international finance flows simply do not exist in any place. The US dollar is a global currency and it is easiest to route all transactions through the US - that's all. The transaction is not taking place in the US, the parties are non US - all that has happened is the the funds have flow in and flown out, probably on the same date simply because that was the most convenient thing to do. For that a $ 10 bn fine ? When financial mayhem is unleashed on the world by US banks, there is a bailout. For this there is a $ 10 bn fine.

It has long been my belief that the truly powerful rarely display their power noisily, if ever. They don't need to.  In the coming world order, especially economically, the US will not be a "superpower". It may be the first amongst equals - that's all. If every other "power" acted like the US is doing today, it will cause considerable harm to the US itself . In its own self interest, the US should behave like a parent and not like a maniacal school teacher.

I wish there was something - anything - that the US would do which can make me gush in praise. I wait in vain. If this is the lot of an Americophile, imagine where the true "burn the US flag" idiot would stand.