Links for 6th May, 2019

  1. “Not long ago, the Liverpool away coach uniform was technical mountain climbing apparel, which had its roots in drug dealers in cold northwest England figuring they didn’t need to freeze to death slinging weed in a park. That meant a lot of North Face gear, which became fashionable. One leader at an LFC firm bought so much high-end gear that when he got a stadium ban several years ago, he actually started climbing mountains around the country, unsure of what else to do with all the stuff he’d bought.”
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    A nice long read on Liverpool: the city and the club. Also a fascinating peek into a place in England that isn’t necessarily English.
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  2. “In my view, reform of government economic administration must take priority. As things stand, it is a prerequisite for the success of any other reform. A weak state cannot deliver anything other than grandiloquent statements of intention. This must change. Without a capable State, there can be no transformation.”
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    Rathin Roy explains in the Business Standard why India hasn’t fulfilled its potential so far, and what needs to be done to change the status quo.
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  3. “How much, in all, does Popovich spend annually on food and wine? That’s hard to say. But he reportedly earns $11 million a year, the highest salary in the league for a head coach. Considering the offerings from his private wine label and that he holds thousands of bottles in his cellar, plots out dozens of high-end dinners per year at some of the country’s most high-end restaurants, drops $20,000 on wine alone at some dinners, and routinely leaves exorbitant tips — well, it’s not a stretch to suggest that Popovich might ultimately drop a seven-figure annual investment on food and wine. “He’s spent more on wine and dinners than my whole [NBA] salary,” former NBA coach Don Nelson says. But in San Antonio — where Popovich has won more with his team than any NBA coach has with a single team in history — the investment, apparently, has been worth it.”
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    Is good dining the means to an end? Read this fascinating article to find out one man’s answer.
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  4. “Gorbachev pushes back at the notion that the Soviet Union’s end was somehow a triumph for the other side. “Americans thought they’d won the Cold War, and this went to their heads,” he says. “What victory? It was our joint victory. We all won.” Well, maybe not entirely — Vladimir V. Putin, pointedly absent from most of the film, is glimpsed in footage of Raisa Gorbachev’s funeral — but you come away from the movie agreeing with Herzog’s assessment, and yearning for Gorbachev’s brand of diplomacy.”
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    A short article about Gorbachev – a documentary about the man. He’s 88 this year, but the article is interesting throughout. And the excerpt is a great way to think about whether you have really understood the concept of a zero-sum-game.
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  5. “The Northern states are densely populated. But this density has clearly not provided the economies of scale to promote rapid economic growth. One problem is that the dense population in the Gangetic plains is not clustered in large cities. Prateek Raj of the Indian Institute of Management in Bengaluru has written about the metropolis vacuum in the Hindi speaking states of Uttar Pradesh, Bihar, Jharkhand, Madhya Pradesh and Chhattisgarh, which together have 500 million residents (bit.ly/2UOS2Kv). “The glaring absence of a major metropolitan center in the region has forced young people to migrate away from the small towns and move to other cities in the West and the South,” he argues.”
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    A lovely read from Niranjan Rajadhakshya about what ails Northern India and how one might tackle the issue. The lack of urbanization is a very real problem in Northern India, among others.
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Links for 12th April, 2019

  1. “Due to these challenges, the Belt and Road has provoked growing international resistance, most acutely in the Indo-Pacific. This rising backlash has not gone unnoticed in Beijing.3 Yet it is unlikely that China’s approach will fundamentally change in the years ahead. The sheer size of ongoing Belt and Road projects limits China’s ability to refocus on smaller and less controversial efforts. Moreover, the Belt and Road is ultimately a vehicle for China’s geopolitical ambitions. Liabilities for host countries – loss of control, opacity, debt, dual-use potential, and corruption – are often strategic assets for Beijing. ”
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    Worth reading in its entirety, both for how well they have framed it (10 issues, 7 challenges) and for understanding the scope, the scale of OBOR – as well as why China wants something like this to happen.
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  2. “Krugman’s assertion that capacity keeps on rising might be correct – but that probably depends on one of the following conditions:The recession is short enough not to significantly affect innovation and investment
    Growth depends on factors that are not (negatively) affected by recessions
    Underlying capacity growth will accelerate beyond trend as the recession endsThe first we can yet hope for, but it’s looking less likely every month.”
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    This was written ten years ago. It is a great way to understand the following: business cycles, trend stationarity, unit root hypothesis, innovation, capacity building, endogenous growth theory. It is simply written, engaging, understandable – and because it was written ten years ago, can be validated. Worth it!
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  3. “Whereas Liverpool’s pursuit of the league title has been characterised by anxiety, drama and late winners, since the turn of the year City have been gracefully efficient at tearing into opponents, getting an early goal and so being able to control a game. Gabriel Jesus’s header against Brighton in the FA Cup semi-final on Saturday was the sixth goal City have scored this season inside five minutes, the 12th before the 10th minute and the 26th before the 20th. That is clearly part of a policy: rip into opponents, prevent them settling and have the game won before any doubts can begin to creep in. It may be that in a two-leg tie there’s less impetus to do that – but then an away goal can make a huge difference.”
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    You might find this choice weird, especially if you don’t like football, but this resonated with me as a way to do more than just play football. Think about it!
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  4. “Mumbai is the engine of the prosperous western state of Maharashtra, India’s largest regional economy with a GDP somewhere between $350-400 billion; the city contributes well over half the total. For Maharashtra to become a $1 trillion economy, Mumbai would need to double or triple the size of its economy, on the back of its preeminent role in service industries, especially finance. That means competing with the likes of Singapore and Shanghai to attract global banks and other world-class financial institutions to the humid, traffic-choked city.”
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    Rueben Abraham and Shashi Verma in Bloomberg on how the port near Mumbai has the potential to change Mumbai into a truly global financial hub. The cynic in me wonders if it will be possible, but the nascent urbanization enthusiast hopes that this, at least, gets off the ground!
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  5. “Amsterdam transit commissioner Sharon Dijksma announced Thursday that starting this summer, the city plans to reduce the number of people permitted to park in the city core by around 1,500 per year. These people already require a permit to access a specific space (and the cost for that permit will also rise), and so by reducing these permits steadily in number, the city will also remove up to 11,200 parking spaces from its streets by the end of 2025.”
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    Speaking of urbanization done just right, here’s Amsterdam with a plan to reduce parking spaces in the city centre – and beyond.

Links for 10th April, 2019

  1. “In an ideal world, you shouldn’t have to amortize. The prices will all be reflective of reality, there will always be a rational buyer at a rational price if you want to sell. In an ideal world corporates will not rollover their liquid fund investments every day either – they will know how much money they need, and they will only withdraw that much, leaving enough back in the liquid fund.”
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    The always excellent Deepak Shenoy explains the how, and some of the why when it comes to amortization in debt funds. If you are interested in corporate finance, finance in general, or policy-making when it comes to finance, this is well worth your time.
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  2. “Within the overall context of having asset allocation in an individual’s portfolio, passive investments will play an important role. It will increase overtime as a complementary strategy. It will not be just be plain vanilla passive but smart beta products. Look at these three benefits. Better returns profile, lower risk profile and wider diversification as compared to normal other products. So, it is a clear cut thing from the growth perspective.”..
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    An interview on Bloomberg Quint about smart beta products. As with the first link, a must read if you are a student of finance, especially from India.
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  3. ““If you wanted a snapshot of all your financial assets in one place on your mobile or to share information securely with a lender, it was previously not possible,” says Atluri Krishna Prasad, chief executive of Onemoney, one of the five entities that have secured in-principle approval from the Reserve Bank of India to operate as an account aggregator. “Now, if you give Onemoney your consent, we will fetch all your financial information from different sources, aggregate it and give you a single window with the consolidated information.””
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    If you were worried about data privacy in India, we’re only just getting started. A nice article in FactorDaily that explains how more data sharing between financial organizations will soon be on it’s way.
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  4. “Here, as in so many cases, the analysts haven’t got beyond an intuition that Johan Cruyff, the Dutch father of Barcelona’s football, had nearly 50 years ago. Cruyff played for Barça in the 1970s, coached the team from 1988 to 1996 and largely invented the passing game that the club still play. He could rhapsodise for hours about players who were “turned” the right way. He cared much less about a player’s size and speed.”
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    Just one of many excerpt-able snippets from a fascinating article about how a sporting club is using every last little bit of information about, well, everything to make Barca (for that is the football club in question) even better.
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  5. “He’s agreed to forfeit about $50m. It’s not clear what’s happened to the other $73m, but Rimasauskas was a prolific and baroque money-launderer who squirreled cash away in Cyprus, Lithuania, Hungary, Slovakia, and Latvia. Google has said that “We detected this fraud and promptly alerted the authorities. We recouped the funds and we’re pleased this matter is resolved.”Rimasauskas will be sentenced on July 29. He faces up to 30 years.”
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    One of those articles that truly help you understand Coase/Demsetz and industrial organization overall. But if I am to be honest, a great read in its own right.