Friday, March 06, 2009

An interesting conversation with a Chase customer rep

I came up with following script I intend to use one day with Chase.

I will probably be home and I will get the usual 1.00 PM call from Chase.  Yes, they do try to reach me every day at home at 1:00 PM to ask me the same thing - if I would like to join their Credit Protector program. It will finally get to me and when I answer the call .... read ahead.

Rep: Can I speak to Girish  Mallalallllllll (some incoherent babble trying to pronounce my last name)?
Me: Yes, this is Girish.  What is this call about?
Rep: I am calling from Chase to inform you about a new service.  Before that, I need to ask you a few questions.

Me: Please, go ahead.
Rep:  Can you please verify your name and address?
Me: I already told you my name.  I cannot verify my address because I don't know who you are.  How can I be sure you are from Chase?
Rep: Sir, I am calling from Chase.
Me: You just told me that. I want you to verify somehow that you are indeed calling from chase and that you are not some rip off.

Rep: But, Sir. We call our customers regularly.
Me: Yes Ma'm.  I know that. But what if you are not from Chase and I verify my name, address and social security number with you and you go an use that information to do something nasty?
Ok, let's do something.  Will you please verify my SSN?

Rep:  Sorry, sir. For security reasons I cannot reveal the information to you.

Me: Address?
Rep: Sir, I have told you.  I am not at liberty to share that with you.
Me: Ok.  Let me get it straight.  You will call me and without knowing who you are you want me to verify all my life's details with you.  Sorry, Ma'm.  I cannot go ahead with this call. And, plase do not call me ever unless you have soem way to verify that you are indeed Chase. Bye, now.

Thursday, March 05, 2009

Not being born in the sixties..

My biggest complaint about not being born in the sixties is that I missed out on Jimi's guitar playing.  Watch him in action here.

A catharsis of sorts.  I do one of two things, when I lose interest with my everyday life.  Watch Jimi play the guitar on youtube or go and read Francisco d'Anconia's speech from Atlas Shrugged.

Wednesday, March 04, 2009

If everyone gets into IIT who will drive my taxi

.. those words were uttered by Dr. Subba Rao, a physics teacher in my high school.  It was his wry sense of humor - poking fun at the banality of life. To give him credit, all he was saying that there are alternative careers and alternative means of making money than becoming engineers.

Much of the US economy depends on services and the argument was that labor was merely migrating to other means of generating returns as our society got efficient in allocating capital.  However, much of the high-end human talent pool that would have gone on to work in nuclear power plants, hydro-electric dams, neonatology, and particle physics was aspiring to work at Lehman, Goldman and Bear Sterns.  Intrinsically, there was no problem with it as long as we had a sizeable pool, portions of which did other things as well.  "Creating" things not merely "conjuring" things.

I am quoting Mr.Friedman from the Times,

As a country, too many of us stopped making money by making "stuff" and started making money from money — consumers making money out of rising home prices and using the profits to buy flat-screen TVs from China on their credit cards, and bankers making money by creating complex securities and leverage so more and more consumers could get in on the credit game.

I remember reading somewhere that much of the value in the last few decades has been created because of better management techniques and I partly agree with it.  The idea might have been oversold but much of the complex global financial landscape has been made possible by innovation in management techniques. However, what has resulted in the guise of financial innovation is merely "hiding" risk and passing the buck than managing it.  The simple marketing principle of keeping the customer at the center of the business has been discarded for the sake of financial returns.  Most firms have forgotten that if they delight the customer, and do it better than others that is the surest path to success - not hiding behind the greeks.  AIG is a classic example where the firm went looking for superior returns via areas that it did not directly understand.  Who were its customers? And, What was it really doing?  As Mr. Bernanke put it - it was a hedge fund riding on the back of an insurer.  The customers where on the insurance side of its business - so what was it doing hedging risk? Hedging risk might be a good thing - but if you are in business only to do that, then who will drive my taxi?

Tuesday, March 03, 2009

Scientific Freedom, Big Pharma and Detailing

I have never been a big fan of Big Pharma.  They act as if they save the world, but they are not doing a favor to anyone given they charge a fortune to provide us medicines.  They don't deserve any moral high ground.  Further, the more they interfere with free academic thought, the more one needs to be cautious.  I had commented a long time ago on the importance of freedom in academia.  I am reproducing it here.  The original comment is on Jagadguru's blog.

Your point also highlights something more deeper in research and incentives. A scientist needs to be truly "objective" and in that sense detached from the phenomenon and the findings. Research that is closely tied to output that can be monetized severely taints the objectives of the true scientific enterprise.

The tenure system in good universities exists so as to enable such researchers to pursue issues that might lack immediate monetary potential but have long range implications for the benefits of a broader audience.

Sure, academia has to collaborate with the industry - but monetizing research output should not be the only criterion for this collaboration. Industry can provide the necessary real world context for the theoretical models that academia develops and the academia can provide a deeper "causal" understanding of the real world that industry desperately needs.

Research has a much broader purpose that is beyond a few innovative ideas and a few researchers making money. It is to develop a deeper understanding of the real world and advance our understanding about ourselves in such a way that it increases social welfare in general.

I am also troubled with the increasing number of research articles being published in leading marketing academic journals on detailing.  Most often detailing is merely a count of the number of visits made by the sales rep.  I have had trouble placing this in a real world context where one can argue that (over) detailing actually causes more harm to consumers.  Physicians may over diagnose and prescribe medicines at the hint of vague symptoms.  Additionally, if you throw in all the possible associations between Big Pharma, sponsored research and the role of opinion leaders in physician networks - things don't look so good.

it is probably time that someone probes this issue taking a social welfare perspective and not merely the financial returns of Big Pharma or their innovation output.

Thoughts on Twitter, Facebook, MySpace, Linkedin...

Some of my research deals with communities - specifically those that are involved in developing open source products such as Linux.  My first published paper proposed a model through which the social capital of developers in such communities might influence the success of open source projects.  As an analogy, consider how things an entrepreneur starts might be successful based on who he is connected to in the VC network.  Makes sense, I hope.

In the following years I also followed developments among other communities a list that included Facebook, Wikipedia, Orkut, Linkedin, MySpace and Twitter.  I was never too impressed by MySpace or Orkut because they seemed like glorified personal webpages to me. I watched aghast as Murdoch's empire paid a huge sum for MySpace without a proper plan to monetize the value that resides in this community.  My curiosity in Linkedin is driven by how well their niche positioning paid off in creating a revenue model driven by subscription and focussed services to recruiters.  Further, they have also managed to generate a wealth of knowledge through their section on Q&A.  Facebook ha sits pluses and minues.  I see their ability to provide interfacing applications as the killer proposition; their inability to figure out an optimum way of leveraging the community connections to provide value for marketers is troubling.  Twitter - seems too superficial to become anything.

My favorite is Wikipedia.  It is a hybrid model with some rules and norms in place, yet it thrives on self-policing and self-organizing capabilities of organic networks.  Further, the underlying purpose of providing a platform for all the world's knowledge is huge and has no ultimate end to it.  That will keep Wikipedia goin on forever.  Wikipedia is also closer to home - open source crowds that participate without an expectation for monetary reward.  Manye have brushed aside such community models where there are no incentives to participate, only to watch in dismay as these models became successful.  Now, they scramble to explain why these models work.  They need to read Richard Stallman.

Networking sites need to figure out how to monetize the crowds.  Where there is a clear proposition, as in Linkedin, I see a great potential.  Those that lack focus and are merely meeting places for a lot of youngsters are flirting with financial doom.  There will be carnage in the social networking world and only few sites will survive. I am betting on Linkedin.

Transaction costs, Fair and Free Markets

I am a believer in fair capitalism not free capitalism.  I don't have any issues with firms and individuals earning unfettered returns to their talents - I myself have benefited from this ability to monetize one's own capital - intellectual or any other form.  However, I also think that there are reasons why oversight is needed, by insitutions, so that free capitalism results in unfair capitalism.

All of us have an incentive to deviate from rational behavior when 1) we realize there is no penalty to such deviance and 2) when there is a loophole that offers us cover to such deviance.  Given this inherent opportunism - something that firms like AIG exhibited so blatantly with a cost not just to the firm but to the entire networked economy, I don't see how rational calls for oversight can be shot down. To believe that firms/individuals will not run amuck and will stick to rules, is utopia. The market disaster reeking with corporate greed and consumer stupidity has more than eloquently established that oversight may not be a bad thing.

I belive that when there are disproportional returns to be made through deviant behavior - they will be made, by any means possible.  Whethere it is the CEOs of Citi, AIG and Countrywide making millions a year based on short-term profits or AIG's income division operating a hedge fund with its principals' money, it is clear that agents will deter from their expected behavior.  Additionally, all these agents who were supposedly acting on the behalf of their principals where only "acting" and in reality they were looking out for themselves.  The average shareholder has lost thousands of dollars whereas the average wall-street employee has made the same thousands in bonuses. Why shouldn't then, the principals call for more monitoring so as to reduce the harm caused by these agents?  The oversight has a name " transaction costs", and no matter how vilely the fiscal conservatives try to describe it - this word has an economic basis to it and is at the heart of all economic activity.  Transaction costs come in many forms and the reason they exist is because contracts between two parties - e.g., agreement betwen CEO and the shareholders, cannot be fully specified ex-ante and therefore require a certain degree fo monitoring to ensure that the agent does not deviate from expected behavior. 

If we think of oversight as a bad thing - are we arguing that contractual agreements between parties are frictionless? Isn't that utopia? The only way that I see one can shoot down the need for oversight is by establishing that all economic entities will be 1) rational and 2) not be opportunistic - things that go against all that we know about humans.

Too much rambling....

Monday, March 02, 2009

GOP: Searching for a voice and Mr. Limbaugh answers

Just heard Mr. Limbaugh's rant against Obama. It was atrocious - ironically it stands for two things, one very American and one very un-American. American in the manifestation of a citizen's right to stand up and rant against the President - something that is not easy in many democracies. And, un-American in its intolerance and hatred.

A hatred that has always been a never ending diatribe against progressive policies that are aimed at reducing inequality and reducing poverty in the country.

The republican party has received a much-deserved drubbing in the elections. Even states as red as NC, Iowa and Virginia have turned blue clearly indicating the tide of things to come in the future. Yet, people like Mr. Limbaugh think that it is their god-given gift to be loud-mouthed go on air ranting against how the country lost its course. They forget that the people's verdict was a vote "for" Mr. Obama's policies not against it. Not having a strong leader at the helm and more importantly having lost its "soul", the GOP is increasingly delineating itself from the mainstream public by turning to people like Mr. Limbaugh.

Support cutting taxes - and also support going to a two trillion war! I don't see how you can stick to the first and comfortably pay for the second! Anyways

From Hinduism to Atheism: One person at a time

I was brought up as a hindu. I had very little understanding of what that meant, but, I knew I had to observe many rituals, pray to many gods and eat a lot of offerings. My world was not my own but was determined by the many gods who decided my fortunes, problems, solutions, life and death. It was a bleak world indeed, one which I could not control.

Then, many things happened. At the end of it all, is the reality that I am an atheist now. I no longer believe that an elephant-headed god determines whether I run into problems or not. It was not an easy task accepting this eventuality. But, it sure was a great journey. A world that I can recognize as my own came into being with a denial of polytheism and paganism. However, the demons come back whenever things do not go as I planned them to be. However, I have decided that I will not let go the contro that I wrested with so much difficulty from the many gods of hindusim.

For me, this struggle is of control. A struggle in which I take a stance that I alone have control over my life and that, things I don't see or feel have absolutely no say in what happens in my life. It has taken a lot of effort and discipline.

Now, I am st a stage where I try to convert people I know. I argue, I fight and and I reason with people's beliefs. And, I have realized it is not as easy thing to do. everyone has a right to believe in what they choose and what they want to believe. I respect that right - however, I will still not refrain from questioning their belief. I do it with everyone within my social sphere and whenever I get a chance to do so.

I find it very difficult to face off against the very people who taught me my first prayers. My aunt and my mom. The early confrontations were difficult and filled with anguish. I almost felt I was betraying their upbringing. Now, I am comfortable taking a stance in the denial of an omnipresent god.

I realize that my belief that one's life is determined by one alone and not by the divine, is not an easy principle to live by. Additionally, who am I to say if this is the right belief? I don't know. However, what I do know is that many of the alternative beliefs have caused great damage and destruction in our world. Therefore, I will try my best to reason against these beliefs knowing fully well that it will not be an easy task. One person at a time, many like me, and maybe we will get there. Maybe we won't; at least some of us would have made an effort.

Sunday, March 01, 2009

Random thoughts on Andhra politics.

Andhra's politics are on my mind. I had the misfortune of watching a clip of actress Roja speaking at a public function. I think it is time, we banish the woman to the land of Neptune and ask Thor to keep watch over her.

The kind of language the woman uses and the things she says on television are just abhorring. Local media is giving her so much coverage that I cannot figure out if they like her or if they are being satirical! Knowing the talent of local media in AP, I can only assume that they think she makes sense because she is loud-mouthed.

The problem in Andhra is that there is no political leader who makes sense. Maybe YSR, but the man frightens me. In general, every idiot who gets the stage gets attention. Mr.Naidu should be severely penalized in the elections for unleashing an evil such as Roja on the public. Her only objective seems to be bad-mouthing everyone. Second, the couple of Jeevitha and Rajasekhar must be banned as well. They have contributed nothing to the field of cinema and now they are here to represent the common man. It is a pity that winning elections is seen as a path to making money. I am sure they are planning how to purchase properties in Singapore if they win elections.

Finally, I plead that Balakrishna be banned as well. Anyone who has seen his movies will realize that the man does not belong to earth. A man who can stop a train with a thigh-slap and make it go back in a movie can cause immense damage to the fortunes of the state. For him the entire state is a stage and its denizens are merely audience.

The state has become a roadshow. Participation in movies seems to be the only ticket to politics. I am sure NTR would not be turning in his grave.