Monday, October 25, 2010

The Ponzi Scheme

I read this in "Fooled by Randomness" by Nassim Nicolas Taleb and it appealed to my darker side. (Please note I have 2 sides one is dark and the other one is darker). So, imagine one fine day I decide to become a share market pandit and start predicting the future of the market on a monthly basis.My objective is to fool some people by making him believe that I do possess some genuine know how about the market and thus can actually forecast the future of the market. (But actually I don't know a thing about the market).Can I do that?

Ok, so I start with selecting 10000 random people and send them an emails. To 5000 people I send an email stating that the market will go up and to the remaining 5000 that the market will go down. Ok now let me do this systematically...

Jan: Prediction Group A (5000 people) - Market will go up , Group B (5000 people) - Market will go down
Actual outcome - Market goes down.

Feb : I dump contact Group A but from Group B, I send another email
Group C : 2500 people - market will go up; Group D: Market will go down
Actual outcome : market goes up

Mar: I dump group D, and send another email
Group E (1250 people) - market will go up, Group F: Market will go down..

and so on...

In April I will have 625, in May 312, in Jun 156, in July I would've accurately predicting the fate of the share market to 78 lucky people seven times in a row...

Now, imagine that you are one of these lucky people who has received this email 7 times in a row and before you receive the 8th one, the I send another email asking you to invest in a share or mutual fund... would you invest?

Saturday, October 23, 2010

A Developed Nation

Japan rapidly grew from a catastrophic nuclear disaster to an economic super power. I've met people that were Young boys and girls when US dropped 2 Atomic bombs on Japan during the second world war. Remembering those days, these people tell me when their father's use to go out in the morning they didn't know whether or not they will be able to bring food for the family that day.

But they were determined people. Their farmers toiled hard in the fields, their workers worked hard in the factories and their leaders had vision. The vision of not just building a developed country but building a culture. They wanted to make their world the perfect world and as a result in less than a half a century, Japan was one of the most powerful economy in the world. Not just that, they were able to cultivate an environment where the people were humble, respected one another. Their streets are safe, clean and their country looked beautiful.

A job well done, I'd say. Now what to do...

As humans, we do things. We've climbed the top of the highest peak of the world, we've learned how to fly, we've walked on the moon. We communicate with each other at the speed of light. We have sent objects out of the solar system. And everyday we are breaking the boundaries of thought. I guess the reason we do these things is not just because we can, but to make this world a better place.

But what do you do when you've already made your place the better place? Japan (and may be some other European countries) is the example of the end result of the development. There is no inflation, indicating that the economy has grown to its peak and can't grow any further. The government can't put money in infrastructure projects to boost the economy because everything they needed to build has been build. The country is growing old, people are not interested in having kids because Nintendos and X-box's are more fun and easy to handle. They've got night clubs and bars where men pay women to just sit with them and hold hands. They care about their environment alright so they import all their timber from other countries. 

Some perfect world huh!

Friday, October 15, 2010


Here's an interesting business idea. Let's see if someone can pick it up and make some money out of it. I'll lay down the idea in a systematic form.

Let's give our company a name say Tele-translator.

Service it will provide - Language Translation on phone

Need for this kind of service - Let's talk about people like me who have to meet with people that don't speak the same language. Now, it may be easy to find a translator but it's not cheap to have him when you are travelling abroad.

How it will work - This service will be on phone. Say you are an Indian and have a meeting with a Japanese guy, in Japan, but you don't know the language and you didn't hire a translator. You reach the meeting spot and as the meeting starts you realize that there is no way you can have a productive meeting because of the language barrier. You dial tele-translator, put your phone on speaker mode and have the meeting.

How to pay - I could think of two options:

1. You can become a member and dial a toll free no. or
2. A non-member can dial a hotline no. where he or she can be charged on per minute basis.

Any takers?

Friday, October 08, 2010

Black Clouds

Ever wondered why some clouds are dark and some are white? Well I did not, but I always assumed that dark clouds bring rain and white ones just float. Anyway, today I saw an interesting thing about this on the return flight to Tokyo. As we were flying I saw a thick cloud sheet below me and patches of clouds above. The areas where clouds above were casting shadows on the clouds below were darker than the surrounding clouds. I think a darker cloud would mean that there are more layers of clouds on top of the lowest layer of cloud.