Sunday, June 10, 2018

Who's minding the store? The Stop Order, of course!

In my continuing series on exposing bad practices of retail investors, this one addresses how one may deal with losses.

Looking at a famished position (say, an instrument bought at a high price, and whose value has significantly dropped) with high anticipation is an undesirable, but commonly practiced choice. Can this pain be alleviated?

An alternative is to sell the position, use the loss howsoever given your income-tax situation, collect the cash and put it to good use - hopefully, in an instrument other than the one that caused the damage and the pain! Psychologically, this allows the investor to "move on," and can help the investor to overcome and eventually forget the pain and the hurt ego associated with booking the loss.

A better alternative is to place a stop loss, good-until-canceled order on every position held. (Another, somewhat complex strategy with its respective pros and cons - discussed in a subsequent article - is to buy insurance with a protective put option) If the stock in your portfolio starts moving in the wrong direction, and to an extent that exceeds the normal flutter (engineers will recognize this as the noise vs the signal), the live order will trigger and sell the stock. It will mind the store unemotionally, and frees you up for subsequent actions with the generated cash.

There are some very rare situations when this approach can hurt - for example, the momentary selling panic that happened for a few minutes in May 2010 (link to New York Times article), when the protective put would have been a better approach.

Also, we need to remember that the market is open and actionable (even for open stop loss orders) only about 19% of the time - allowing for the time every day between market close and market open, weekends, some half-days, and other off days. How can one mind the store while the "market is sleeping?" That, for another time!

Friday, May 4, 2018

You love the slow lane, don't you? ...2018

Imagine you are on a multi-lane highway, with moderate traffic in all lanes .. and, the lane that you are in starts slowing down. At first, it is just about noticeable, but traffic lanes never maintain a constant speed - they tend to go slower and faster, so you take it in your stride. Your lane slows down further, and further - now, you see cars in the other lanes - particularly, in an adjacent lane zip past you. What do you typically do? You look for a safe opportunity to change lanes, take the appropriate precautions, and move into the fast lane. Obvious, isn't it? We've all done it innumerable times.

Let me now shift our attention to investing. You are holding a stock in your portfolio - how and when you acquired it is immaterial - because, and only because, the stock doesn't know it and neither does it care! Let us even assume that this stock was doing well recently - here, we need to objectively define what "doing well" means - I would define it as "monotonically demonstrating a certain rate of increase in its value." Then, the stock starts slowing down. Its value remains flat. Then, it starts falling - sometimes, like a knife. What does a typical retail investor do? First, (s)he looks at the other stocks growing in value, and consoles her/himself that (s)he is in it for the "long run." "I have studied this stock's financials, and it has to do well." You can see that the investor has already started showing attachment to the stock. This attachment causes the investor to buy more of the slowing down stock. Fall more, buy more! "The pundits have talked about dollar cost averaging. This has to work. In the looooong run."

I am sure the similarities in the traffic and investing examples, as well as the differences are now staring us in our faces. The only reason we don't stick it out in the slow lane, is because we are not attached to it. We readily accept "writing off" the time wasted in the slow lane and reduce the delay of reaching the destination to the extent possible by moving into the fast moving lane.

It is not only in spirituality that Detachment helps ... it matters while driving .. and, also investing!

Sunday, April 29, 2018

Baba Black Sheep ...2018

"Baba black sheep, have you any wool?"

     "Yes Sir, Yes Sir; o'er their eyes I pull
       I claim to lead, and they're eager to follow -
       with emotions and issues that have them harrowed
       In a dark tunnel, they seek a light
       My mysticism gives hope for their plight
       Unusual garb is what I then adorn
       Hair growing wild ... or, completely shorn
       Big words, rites, rituals, and incense sometimes
       My followers think their leader is divine
       Captive in my grip, their minds get weaker
       They pull in more, my commune gets bigger

       Alas for me, some see through my game
       They tell the truth and put me to shame
       How they were controlled in mind and body
       And surrendered to my every whim and fancy

        I'm now the Humpty Dumpty on the wall
        One by one, my types will fall
        My subjects are now learning to reason,
        to smell the fresh air, and colors of the seasons"
        



Wednesday, April 18, 2018

Know Thy Exit ...2018

How many times do we enter a highway to get to a destination without (us or the GPS) knowing anything about where/when to exit the highway? We rarely join the highway just for a ride!

In contrast, when many of us (retail investors) do financial investing/trading, we are quick to act on a hot tip, either from intuition, or something someone whispered in your ear, or from a financial news network, ... The action from the hot tip is usually to buy a specific financial instrument (typically, a stock or ETF or mutual fund) - more generally, to apply cash to "enter" a trade or a position.

Upon entry, attachment and hope sets in - "This stock has to go up." "I am fond of this stock." "I got it at such a low price." "My stock has excellent fundamentals." "I am in it for the long haul." Little does the stock know of your hopes and dreams about the stock! It continues on its merry journey of ups and downs, well-explained after-the-fact by all the financial pundits. The result of this phenomenon is that we hold on to the stock in our portfolio, with no clear objective - metaphorically, we continue to ride on the highway with no view of the destination or the exit!

If the stock does go up, there come other factors that induce inaction - "It has gone up so much, it will go up more." "I will incur capital gains taxes if I sell now and realize the profit." "I will consider selling when I am in a lower tax bracket, or I have other capital losses to compensate." "This stock pays good dividend." The stock is still oblivious to our motivation to hold the stock!

Lo and behold, the stock encounters potholes on its journey - Citigroup dropping to 5% of its value over 2007-2008, and recovering to only 15% of its peak value over 2008-2018; and, more recently, GE losing over half the value from its recent highs. Ouch! I dare not mention any names from the dot-com-bubble-burst from the early days of this millennium, or the deeper scars from dollar-cost-average buying more and more of the falling knife!

The lesson from this experience should now be obvious: Have an exit strategy before you decide to enter, and the strategy should include booking profits as well as cutting losses in a finite timeframe.

..and for those of us who find it difficult to define exit strategies on stocks, ETFs, mutual funds ...options offer a forced price and timeframe - the strike price and expiration date - with definite profit/loss consequences.

Stay tuned for more ...

Friday, January 26, 2018

Dementia and Objectivity ... 2018

The intent of this article is not to define what dementia is .. I am no expert in that area, and I refer the reader to an excellent handbook on the subject, "Remember Me - You Me and Dementia" by Sailesh Mishra, published by Silver Innings (www.silverinnings.in) and other resources. The intent of this article is to share the learning of having dealt with two such situations in the family. While I may be the spokesperson here, all credit goes to my other family members who dealt with those with this condition day to day and acted in the face of family and society resistance.

Objectivity has many definitions, and I shall use the following for the purpose of this article (http://www.dictionary.com/browse/objective):


  • not influenced by personal feelings, interpretations, or prejudice; based on facts; unbiased
  • intent upon or dealing with things external to the mind rather than with thoughts or feelings, as a person or a book.
We will explore numerous facets of objectivity and put it into a practical context.

  1.  Acceptance, and not Denial. After the initial shock of "this may be" one may do diligence to reach a definitive conclusion of "this is" (then, you may continue reading this article), or "this is not." To this day in the 3rd millenium, there exists considerable stigma about this and a strong bias to be in denial. Denial can only shorten the runway for action, leading to panicked decisions in moments of crisis. If the solution is for in-home care or institutional care, families find themselves insufficiently prepared with the alternatives and their reviews
  2. Research-based Remedies vs. "Snake Oil" Treatments. While the medical research community is investing heavily in remedies, we know generally that a "cure" is yet to be found. In the absence of a cure, there is a proliferation of unproven, "it can't hurt, if at all, it will only help" treatments. There is a reason I call these "treatments" and not "remedies": there is no proof of success other than irreproducible anecdotal stories. In a state of desperation and panic, there is a tendency on the part of the patients' families to run from pillar to post, and the "snake oils" offer a ready bait! It behooves affected families to conserve their already-thin-stretched resources by not falling for such treatments.
  3. Implicit and Explicit Cost. Given that economies of scale have not yet been achieved in India (they have been achieved somewhat in the US) to lower the cost of dementia care, the cost of providing in-home or institutional care remains extremely high. Families of patients considering professional care have to brace for this, potentially indefinite, cash outflow. The "do nothing" scenario has costs, too - impacts on impressionable-age children in the household, the stress on the marriages, inconvenience to neighbors, and the quality of life of everyone around. For families that can afford the professional care costs, it can help to know that that is the price they have paid to save the implicit costs.
  4.  Current Information about Facilities. Everyone wants the best facility/solution for the patient in their family. However, due to the paucity of such facilities, a vacancy need not exist in the facility of your choice when the need arises. Secondly, the family may not have complete and current information on all facilities within the geographic and economic scope of the family. When the time comes for a decision, the family can find themselves with sketchy, indirect information about the facilities - the type of care provided, the current fee structure, space availability, and general reviews. It is, hence, necessary for the family to maintain a list of fully vetted facilities. New leads become frequently available, and these need to be qualified per the family's criteria promptly.
  5. Overcoming stigma. The family can find itself paralyzed between opposing points of view within the family and in their social environment. Ideally, consensus needs to be strived for within the family, including the patient, if the patient is capable of discussing alternatives and implications on themselves and others. Social stigma from neighbors and other social networks is more difficult to address - this involves a larger number of people on whom one may not have influence. This is where one needs to let the people come around over time, if at all, by seeing the peace brought to the patient as well as others. This constituency is best ignored, and not made a factor in the decision. I do recognize that there can be environments where the ostracizing can be severe and can make day-to-day living unbearable.
I adapt a quote attributed to Einstein: "No problem can be solved from the same consciousness that it exists in." This applies quite well to the problem of dementia management - and I urge those involved to be an objective witness so all aspects of the solution can be unemotionally evaluated.

Sunday, December 31, 2017

2017 - the Year of "This Can't Be!"

The year started with me thinking "This Can't Be" - while still in denial of the "death in the family" that many of us experienced, aptly reflected by an obituary:

T.Ruth D'Mocracy, mother of Hope, Integrity, Grace, Liberty, Justice succumbed to injuries inflicted by B.Gotry and D'Vision. R.I.P.
(inspired/plagiarized from a similar obit over four decades ago from another part of the world)

The nation's administration was an unprecedented revolving door of yes-men (and, yes, no women) with many of us saying, "This Can't Be!"

My Chinese friends consoled me that this was the Year of the Rooster, who welcomes the rising sun and spreads cheer on a bright morning - only for me to discover that the Rooster had started believing that he was causing the Sun (and the stock market) to rise, the unemployment to fall, and the nation becoming great. I said, "This Can't Be!"

The spate of sexual misconduct incidents - not only from decades ago, but from recent years - came to light and brazenly exposed the dark side of humanity. That this can happen in what is considered the most progressive nation on the face of this earth, had us saying, "This Can't Be!"

There was no shortage of mass shootings and other terrorist incidents - with perpetrators using low-tech improvisations on legally obtained guns to spray bullets, as well as unsuspecting "weapons" like pick-up trucks to plow down pedestrians. "This Can't Be!"

A passenger train went off the rails on its maiden journey. It was just over a century ago that a famous ocean liner on its maiden voyage had met a similar fate. The mechanical engineer in me said, "This Can't Be!" 

But it was not all bad. There were glimmers of hope. We saw the election of Emmanuel Macron, and as importantly, the defeat of Le Pen; we saw the election of Doug Jones, and more importantly, the defeat of Roy Moore. The Solar Eclipse that traversed the country was not only an astronomers' obsession, but a conversation piece in tens of thousands of kitchens and family rooms.

I start 2018 saying "This Can Be!"

Friday, September 8, 2017

LX, and lovin' it .. Sep 7, 2017

LX, a notch of appointedness in a contemporary car, is no different than how I feel with the same Roman numeral age. Me, a 1957 model with most cylinders firing, in an LX state-of-mind-and-life!

Sixty is a milestone, no less significant than sixteen (driving age), eighteen (adulthood), twenty-one (smoking and drinking age) ... and then a long gap of thirty-nine years! While thirty, forty, fifty claim to be "over-the-hill" milestones, they are lack-luster compared to their next decade milestone.

That sixty comes after 59-and-a-half is an irrefutable truism! That means IRA withdrawal eligibility without a 10% penalty! The next 10-and-a-half years is when I have the prerogative to avail of the IRA without the compulsion! What freedom!

Second, it is the completion of a decade over which one's life risk grows 20+ times - the actuarial assessment of the life insurance premium - which makes the one-time-affordable-and-necessary life coverage now unaffordable-and unnecessary!

Third, it is the beginning of a decade which will make me social-security-eligible in two years, and at the end of which, the social-security payments will not grow. And, it is good to note that the risk of social-security insolvency did not materialize in my lifetime.

Having enumerated the tangibles, I move to the intangibles - what age one feels and not what age one is!

A poet, Bhausaheb Patankar, has written:


पौत्राधिका पाहून वाटे झालो जरासा वृद्ध मी 
(I realize I have become old only when I see the next generations)

That is, it is only the circumstance, and not my state of mind that defines my age state. Some youngsters, out of reverence, address me as "uncle", and this got extrapolated to an extreme when a toddler addressed me "grandpa" - with his real grandfather in tow, proud of the baby's sense of judgment! Do I call this poor conditioning, or what?



I remember a children's cartoon called The Little Engine that Could - the "could" to be interpreted as "the little engine could do anything it wanted to through hard work and focus", and not "the little engine that could do somethings that it cannot do today". I definitely subscribe to the former (and intended) interpretation. Gone are the days when age determined the corner of the room (or balcony) that a person was "retired" into, with do's and don'ts galore, a plethora of pills and mostly meaningless restrictions. Here comes the world of living it up - in mind, body, and spirit - and an acceptance that thinking can only evolve and not degenerate!

The Bucket List - the term derived from the days when public hangings in the medieval times involved the convict standing on an inverted bucket with a noose around the neck, and the bucket then being kicked to complete the execution! Notwithstanding its etymology, it speaks to the urge of completing/achieving some things (obviously!) before dying. 

A cousin posed a question, "What if you are on your death-bed thinking that there are so many things you have not done/achieved?" 

My answer was unromantic: "First, it is very unlikely that you will know you are on your death-bed, because the moments just before you die are tagged as such only after you die! Second, it is very unlikely that you are in such sharp state of mind to think as your mind and body are fast shutting down. Third, suppose you do know that those are your last moments, and suppose you are in a state of perfect rational/emotional thinking - what is the big deal of not completing/achieving everything?"

Needless to say, my response was not well-received, and he has not discussed that topic since, though both of us are still well and kicking!

I am not quite prepared to give anyone any piece of advice on life or any other matter, much that age will bring upon me those expectations to fulfill. The word I have come to like a lot is Spontaneity! For no profound reason, for no "lining up of the stars", but "JUST BECAUSE" - another remarkable phrase I have learnt from the teenagers. The "because" satisfies our innate urge for analysis, the "just" so beautifully nullifies it!

I admire moon-rises and eclipses ... just because
I love driving without the GPS (and sometimes, wipers) on ... just because
On my next trip to London, I shall try out a hookah on Edgware Road ... just because

I live the remainder of my life ... just because ;-)

Friday, August 25, 2017

Charlottesville .. about a week later .. 22 Aug 2017

Rohini and I chose Charlottesville, Virginia as our en route overnight stop while returning from the Eclipse Trip to Tennessee. The events that had occurred a week prior were a definite factor in choosing that location to spend a night and day.

To our delight, the city had sprung back to normal, despite the ugliness of the prior week. This was testament to the fact that the troubles were caused by outsiders, and Charlottesville residents had nothing to do with it. The shopping district "the downtown mall" - a pedestrian street lined with stores, restaurants, and a theater was busy with people, with one conspicuous difference - every storefront had the sign, Love Heather! 


The same message was prominently displayed on the movie theater on the pedestrian plaza. Heather Heyer, the fatal victim of the racial scuffle and the action of a terrorist car driver was prominently in the air.

We had an opportunity to talk separately with two long-time Charlottesville residents -- they were, seemingly, a Democrat and a Republican, and gave us their candid opinion about the events. What was uncanny was the similarity of their reports, transcribed in quotes below.



"The controversy around the removal of the Robert E. Lee statue (you can see in the far distance in this photo of the park) was politically motivated, and driven by a petition of someone who was related to an official of the city government. 




The administrations (city and state) managed the logistics of the event very poorly - the outsiders, who came in hordes by buses, were given a permit to assemble in the park that was called Robert Lee Park, and now is called Emancipation Park. A short while before the protest, their protest was called out to be an unlawful assembly, and the protesters were asked to leave. The counter-protesters had already assembled a block away. 

Rather than steer the protesters out by a different route (the square has roads coming in from all sides), law enforcement steered the protesters away from the park on the same road where the counter-protesters had gathered. This caused the two sides to come into close proximity and violence (shouting, scuffles, etc) erupted. This was soon followed by the car plowing through the crowd, as marked on the map above."


The site of the car attack has now been cordoned off to vehicular traffic and the section of the street has a floral memorial to Heather Heyer.

Perhaps with learning from Charlottesville, the Free Speech rally in Boston the following weekend had immense law enforcement support and much better planning, despite the fact that the size of the gathering was much larger. The loss of Heather Heyer's life has brought forth some unquestionable principles:

  • Violence does not cause constructive dialog, it only causes further polarization
  • Political agendas confound issues, and frequently stroke latent biases
  • All of us are entitled to our opinions, but nobody has an entitlement to superiority and bigotry


Sunday, August 20, 2017

Charleston? No! Knoxville? No! Idaho Falls? No! Knoxville, YES!

   
E minus 37 years, 6 months, 5 days .. 16 Feb 1980 ...

It was only a few months prior that I had completed my engineering degree and started a new job. My best friend, Narayan Shenvi, had just completed his medical degree and was doing his residency. "Science Today" was the avidly read science magazine published by the Times Of India group. And, it mentioned the E-word that was to cross the Indian peninsula, about 400 miles south of Bombay, where we were both located!

The umbra and penumbra that had fascinated me as a geometrical construction were coming to life. The state government announced a special E-tour by bus from Bombay, and you can guess who the first registrants were - eagerly hoping that the 10-million-strong-metropolis would arouse another 40 enthusiasts so the trip is not cancelled!

The preparation for the trip started .. the precious camera I had was a no-fringes, point-and-shoot, no-settings-of-any-sort, Agfa Click III, which per the currency rates of those days would be worth $8 - a huge amount in the socialist India of those days.

Loading it manually with a black-and-white 120 film, cranked carefully to the first picture position, and then you just hope that the ratchet doesn't slip and cause an irreparable fiasco inside the camera, destroying all the exposures taken on the 12-exposures-roll.




E minus several/few months ...

The Great American Eclipse was the silver lining on the dark cloud of a "this can't be true" post-Presidential-Election lunch meeting with Dave Silverman, CEO of American Atheists (AA). The Annual Convention of AA was divinely timed and situated with the Great American Eclipse - August 21, 2017 .. in Charleston, SC. This celestial event was not to be missed, the convention being the icing on the cake. Mental preparations began, and even as I contemplated a change in employment (which did not happen), I started setting expectations with prospective employers about my August time-off to ward off the evil of business travel. Weather plays a major role (as fellow eclipse-chasers and tornado-chasers will agree).

With the social media awareness, it was a foregone conclusion that big crowds will inundate middle America small towns. As we decided to make this a family outing, and with drive time as a factor, we finalized on Knoxville, making reservations for a night on the way and back. Monitoring the weather at E-14days, showed scattered thunderstorms all the way from Charleston, SC to Kansas City, MO. Then, a decision to go to Idaho Falls, ID, well beyond driving feasibility, scurrying to get airline seats to the nearest airport (Salt Lake City, 230 miles away), and a rental car (at a location 15 miles from the airport.

E minus 65 hours

Our bags are loaded, boarding passes printed, Lyft arranged for a ride to the airport. It is 10:30pm Friday, Aug 18. We are 8 hours from the flight take off time. I hear the ping of a text message on my phone - it is United Airlines telling me that our first flight leg - to Chicago - is delayed - this has the cascaded effect of missing the connection to Salt Lake City. I spend about an hour on the phone with the United agent, leveraging my elite privilege to find any other routing from any other airport (La Guardia, JFK, Philly) - not a seat available - there are millions of eclipse-looneys like us! We make a split-second decision to cancel our Idaho City plans, and revert to the original plan of driving to Knoxville, come what may on the weather front - which has, incidentally, cleared up to "mostly sunny" on E-Day!

And, the return trip will allow us to visit Charlottesville, VA, where the recent events demonstrated the dark moral eclipse that this country has been experiencing :-(

E minus 1 Day

Rohini's favorite quote is, "make lemonade when you are served a lemon" and this principle went into full gear!

The first stop was for crabcakes at Nick's Fish House on Baltimore harbor! GoogleMaps offered us interesting detours through rural Virginia to avoid the heavy traffic on I-81.

We got a chance to experience Southern delicacies at Mama's Farmhouse in Pigeon Forge, TN - a complete breakfast with grits, sausages, bacon, fried chicken, waffles with chocolate syrup, biscuits with gravy!
  A ride up into the mountains allowed us a visit to the abodes of the early settlers.

And, not to forget the facilities offered by the newly constructed hotel - a swimming pool and a barbecue pit!

 
E-Day



The hourly weather forecast is just what the doc ordered! The next uncertainty is the traffic to the center-line of the band, a drive of about 70 miles from our overnight perch. 

We have chosen the viewing site to enable a quick getaway back home by the highways soon after the period of totality. At this hour, E-9hrs, the traffic is moving smoothly. The top of the Smoky Mountains, Clingman's Dome, is another story - the Park started issuing permits to go there, which have been sold out. We have heard that the park has arranged buses to ferry eclipsers up and down to the Dome, and these are sold out, as well. Cades Cove, an 11-miles one-way loop in the mountains opens at sunrise. The Ranger told us that a few dozen cars line up for first entry on a "normal" day, but they are expecting a few hundred to have lined up overnight today. 

We have decided to not partake in that frenzy, and our intended location is Sweetwater, TN, which offers the following E-duration, all times in UTC.

The area will come into the penumbra at 1:04pm, into the umbra at 2:32pm, emerge out the umbra at 2:35pm and emerge out of the penumbra at 3:58pm.




Though the traffic seemed normal, we decided to take the back roads through rural Tennessee to get to the site at the center of the band. Stopped by a gas station and a grocery store along the way, life seemed as normal as would be on another week day. Once we got into the ~2 minutes band range, we could have stopped anywhere along the road, or in some parking lot and enjoyed the event. It was nowhere close to the frenzy that was being reported about some towns in Oregon and other places.

 No automatic alt text available.

Local businesses capitalized on the event, in a nice way. Businesses very close to downtown (which was made a pedestrian plaza, and had music, food and other facilities) offered to sell parking spots - $20 within a block, $10 a block or two away. The $10 signs were actually crossed out $20 signs - showing the interplay of demand and supply. A restaurant that had patio seating put a premium of $25 on the eclipse-viewing-over-a-pitcher-of-beer experience!

Thousands of enthusiasts have posted numerous pictures of the eclipse, so am posting only one of a few that I took.

Image may contain: night 

What does not come through in the photographs is the experience. The ambient light gets eerily dim to what would be post-dusk. The temperature drops several degrees, and you start feeling the cool breeze. The cicadas in the trees suddenly come alive and start chirping - with this totally unexpected "nightfall". We didn't have any animals around us, but I understand that they also demonstrate strange behaviors. And, in three minutes, it is "sunrise" again! The scorching sun returns in a few more minutes.

That makes a total eclipse so very different from a partial eclipse, and all sights now set on 8 April 2024, which will travel closer to the east coast, the band covering San Antonio, Austin, Dallas, Dayton, Columbus, Akron, Cleveland, Erie, Buffalo, Rochester ... what will the weather be on that Spring Day?

Friday, June 23, 2017

Determinism, Fatalism, and Free Will ... 2017

Richard Dawkins made a reference to the intriguing concept of determinism during his lecture at George Washington University in May. Let me explain determinism using a layman example. Take a ping pong ball that is hit by a paddle and makes its bouncy trajectory across the ping pong table. Given the dynamics (see footnote 1) of this phenomenon, there is one and only one path that the ball can take. There is no "decision point" for the ball; the stimuli for this "system" unambiguously determine the outcome. Now, extrapolate this seemingly simple ping pong ball situation to everyday life - where every cell, neuron, chemical reaction, electrical impulse is, fundamentally, no different from the ping pong ball. Thus, the state of the universe at any point in time, and the laws of "physics" that its elements seem to follow, determine the state of the universe at the next point in time, and so on, without room for variation, decisions, and ..... free will!

Compare this concept with fatalism, which spares its subscribers the "physics" argument, and provides a bypass with the concept of the super-natural power, to say that everything is pre-ordained ("it is written," as some say, without specificity of what, where and by whom) and happens per a master plan of a supernatural power. "Whatever is to happen, happens (and, only that happens)" is a common tautology that one hears from the subscribers, sometimes with a comforting spin, "Whatever happens, happens for the good," with no clear definition of the "good." This is a convenient school of thought to abdicate personal responsibility to "fate" and transfer blame to the fuzzy thing out there.

Both the above concepts have their severe ethical shortcomings. As to determinism, phenomena are not known to the degree of precision and system behaviors are not known to the degree of mathematical abstraction to infer the next state from the current state. This lack of complete knowledge gives room for the uncertainty and offers an opportunity for free will to be exercised, so humans can add an additional stimulus to the situation and see the impact of it. In the simplest of cases, there can be multiple routes to get from one place to another - and the availing of the excitement and empowerment of deciding which one based on an intuitive evaluation of the conditions at that time. With the conditions not fully known, the outcomes are not a priori known. Each outcome contributes to the learning, and learning contributes to better decisions and increased knowledge of the situation, which in turn contributes to more predictable outcomes. Perhaps, a micro-step towards determinism, but safely and sufficiently far from total determinism.

Fatalism is a totally debilitating corruption of the human psyche. Living in surrender may have benefits in ego management and some therapeutic value for the weak minded who need to pass on the accountability of bad situations to the punching bag of fate; it completely takes away creativity, the passion to excel, the craving to extend the frontier of knowledge and experience the excitement of the unknown. It is no surprise that the advancement of critical thinking, science, technology, medicine, ..., has happened in less fatalistic societies, while fatalistic societies have complacently reveled in mythical glories of the past.

I rest my case with an invitation into the exciting realm of science and inquiry, before someone says that this invitation and the blog post were pre-ordained ;-)

Footnote 1. The dynamics of the ping pong situation includes full knowledge of the behavior of the paddle, the bounciness of the ball, the resistance and eddies in the air, the texture of the table, and many other factors.

Footnote 2. The path implies the locus through space as well as the velocity, acceleration, ... and the changes in these characteristics during the period of observation.

Sunday, December 4, 2016

2016 - The Year of Reason (personally, that is)

December is often the month for introspection about the year passed, and 2016 has been an eventful year by the reason metric. (Mind you, I am not talking about the national or world scene, where irrationality saw no bounds, and rational beings still wonder what ever happened to good reason!)

Spring was heralded by the privilege of an invitation by a close friend who had arranged an afternoon with Hamid Dabholkar of http://antisuperstition.org. A delightfully enlightening exchange of ideas about the extent to which superstition, god(wo)men, and irrationality thrive to this day, and the bystander apathy demonstrated by the population at large. Volunteers who run the organization endanger their lives to expose god(wo)men who exploit the vulnerabilities of the populace. The organization lost their founder (and Hamid's father) to an assassination a few years ago. Since then, there have been another couple of assassinations of rational thinkers in India. The audience in NJ offered a compassionate hearing, with no keenness to get involved and further the cause.

The meeting with Hamid inspired me to establish contact with a long-lost (to me) thinker, Prof. Akeel Bilgrami of Columbia University. Akeel had taught me Logic and Ethics during my undergraduate years four decades ago! A few email exchanges and phone calls later, Akeel agreed to speak on "Religion and Rational Thought" to an audience of about 30 at our house in the Summer. In his "stream of consciousness" style, Akeel explained why rationalists cannot be in denial about the relevance of religion to the society at large. He explained how the radical few are perceived as de facto spokespersons for an ideology, and how forces of democracy are an answer to curb such forces. He explained the concept of secularization (as defined by wikipedia: the historical process in which religion loses social and cultural significance. As a result of secularization the role of religion in modern societies becomes restricted. In secularized societies faith lacks cultural authority, and religious organizations have little social power.) and provided several examples from everyday life.

The Bilgrami talk resulted in a distribution list of open-minded folk (which I fondly call "The Philosophy of Reason" distribution list), and this list gradually grew to include several friends and acquaintances. Come Fall, I got into deep conversations with Prem Kamble, who has published an e-book, God in Two Minutes. Contrary to what the title may imply, the book debunks the concept of god in two minutes, and proposes a framework for psychological analysis, hitherto poorly played by religion.

A few more introductions, and an in-person rendezvous with David Silverman, the President of American Atheists! A lunch meeting on a cold, rainy day, David showed the vast collection of atheist writing that the organization has preserved in its library. An activist to the core, David ventures into conservative spaces, bracing death threats. He has authored a book, "Fighting God", which I had bought and started reading on Kindle, and the visit yielded me a hard copy autographed by David! Over lunch we discussed "what next", given the ground that the religious "right" gained in the recent Presidential election in the US.

2017 holds more excitement - a definite agenda item is the annual conference of American Atheists in August, scheduled to coincide with a total solar eclipse!

Friday, November 25, 2016

Right is the new Wrong ... 2016



Over my not-so-short lifespan, I have seen many terms assume completely opposite meanings. When I was in college, it was cool to be “funda”(mentalist). One strived to understand math, physics, chemistry from basic principles, which were called fundamentals. Textbooks and prestigious institutes of science and research bore that word in their titles.



Then, the world started changing. The word “fundamentalist” presupposed the unspoken prefix associated with religions. The term started representing anti-social elements that held the potential to cause destruction and death.



A similar etymological evolution has occurred with the word “right”! Growing up, it was a good thing to be right. The world has, since, been drifting to the “right” – exclusive, irrational, polarizing forces wiping out the possibility of an intelligent discourse. Just like the f-word, I now stay clear of the r-word! Right has become the new Wrong!!

Sunday, November 13, 2016

The Currency Bills Supply Chain in India – a noble plan and an execution fiasco ... 2016


In this day and age of the plastic surrogate to currency bills and online transactions, I would have never thought that the supply chain of currency bills would be a matter of any interest … until a few days ago.

On November 9, the Government of India demonetized, in a surprise swoop, the two largest currency denominations (INR 500 ~= USD 7.50 and INR 1000 ~= USD 15) with the long-eluded objective of paralyzing the parallel “black” economy – the tax-evaded income stashed away by people and used for undesirable purposes including dowry, drug trafficking and terrorism.

The objective, without doubt, is noble. Its “shock-and-awe” implementation, though, was wrought with poor execution. When a supply chain substitutes one product for another, it is a no-brainer that the substitute product has to be prepositioned in the supply chain in sufficient quantities at the right places to not cause a stock-out with a likelihood greater than an accepted, small threshold.

There can be many reasons why this multi-echelon inventory problem can go awry. First and most importantly, the demand has to be reasonably forecasted. In this example, there was no precedent to go with, that the Government could have extrapolated. However, I am sure the Government knew the magnitude of the problem they were trying to solve – not the magnitude of the ill-gotten money, but the magnitude of hard-earned money in the hands of commoners that existed in the two denominations that were made defunct. It is another no-brainer that it is this amount that will be offered for exchange for other denominations – the lower denominations still in circulation (INR 100 ~= USD 1.50) and new bills of higher denominations being introduced.

Recognizing the challenge of the demand forecasting problem, it can be alleviated by having super-responsive logistics to move currency inventory from higher echelons to the retail “points of service”, that is, the branches of banks. There can be forgiveness for not knowing the unknown, but not for not putting in place dynamic measures and not anticipating the panic and herd behavior under such conditions.

There is no dearth of operations research, inventory optimization, and logistics professions in India and within the diaspora the world over.


In the meanwhile, tens-of-millions including my 87-year-old father are making the rounds at neighborhood banks day after day and standing in long lines to exchange a few old bills for new ones. It was decades ago, that there used to be such lines for the cooking medium kerosene, and groceries such as wheat, rice and sugar under the nightmarish institution called “rationing”. Now it is old wine in a new bottle!