Category Archives: Uncategorized

Even God can’t help India: SC

Aug 6, 2008; ToI – Even God can’t help India: SC

Kashmir Issue

The concept of partition is anathema to Indians. Kashmir’s symbolism to India is as critical a consideration as any security significance associated with this fragment of ice and rock threaded by a beautiful valley. New Delhi is also concerned that Kashmiri autonomy would set a precedent for breakaway movements in other Indian states (e.g., Punjab or Assam).

To Pakistan, Kashmir is symbolic of its national ethos and commitment to protect Muslim interests against Indian encroachment. It believes that the creation of a separate, strongly sectarian nation is incomplete without contiguous Kashmir.

Kashmir, in brief, symbolizes the enmity that Hindus and Muslims harbour for one another.

The earliest recorded history of Kashmir by Kalhana begins at the time of the Mahabharata war. In the 3rd century BC, emperor Ashoka introduced Buddhism in the valley. Kashmir became a major hub of Hindu culture by the 9th century AD. It was the birthplace of the Hindu sect called Kashmiri ‘Shaivism’, and a haven for the greatest Sanskrit scholars. (

Kashmir indeed is a land of learning – or is it? (

In the past 61 years of Indian Independence, what has mainland India (and Indians) done anything to help average Kashmiri feel proud of being Indian and feel connected with the mainland India?

Symbolic announcements that Babus and Netas make in New Delhi do not make the day-to-day life of the citizen better. We need action, not of the defence forces, but the human touch. There is no perennial connectivity between Kashmir and the rest of India. Probably disputed regions of Kashmir are better connected to Pakistan than with India, how ironic?

I looked up the Internet to find out
* Average per-capita-income of Kashmir vs. the rest of the states in India
* Education, health care, economic statistics of Kashmir vs. the rest of the states in India

I wasn’t able to find anything worth mentioning.
It has been suggested ( that India could incur daily expenses of $2.3 million to keep a watch on disputed stretches in Kashmir.

If we can use the same funds (a portion of it, to start with) to foster, economic and social development in Kashmir, most of the issues facing India would be reduced if not resolved completely. Under the given circumstances and also because of geographic conditions, it is difficult to attract heavy industries. Generate local employment – Kashmiris are dependent on agriculture, tourism and small scale industries for their livelihood. Create framework to support these activities – use technology to solve to solve problems of transportation, connectivity.

A happy well-fed society would rarely engage in riots and terrorism. Have you heard of a Swiss group engaging in religious war, terrorism or riots? Why do such things happen in Asia, Africa or Middle east ?

Such riots are more to do with growing unrest as a result of socio-economic inequalities (to the extent of seclusion and deprivation) than the religious beliefs.

Subprime Primer

What is subprime lending

The term subprime lending refers to the practice of making loans to borrowers who do not qualify for market interest rates owing to various risk factors, such as income level, size of the down payment made, credit history, and employment status.

In general, subprime lending (also known as B-paper, near-prime, non-prime, or second chance lending) is lending at a higher rate than the prime rate.

However, in U.S. mortgage lending specifically, the term “subprime” simply refers to loans that do not meet Fannie Mae or Freddie Mac guidelines. It may or may not reflect credit status of the borrower as being less than ideal and may not even reflect the interest rate on the loan itself. The phrase also refers to bank loans taken on property that cannot be sold on the primary market, including loans on certain types of investment properties and to certain types of self-employed persons.

How the Subprime Mortgage Problem Developed

The problem now challenging financial markets and the economy stems from historically low interest rates that encouraged millions of Americans to refinance their fixed rate mortgages. The lower interest rates meant that buyers could afford larger mortgages. Effectively, a bidding war broke out that raised the prices of homes. While some markets had larger price appreciation than others, higher prices limited the number of potential buyers. In response, the home financing industry developed new products that allowed otherwise unqualified individuals (by income, assets, and/or credit history) to receive loans to buy or refinance a house.

These same products also allowed creditworthy households to buy more expensive houses or to refinance their current houses to obtain cash for other uses. These riskier mortgage instruments, referred to as “subprime” loans, in recent years have come to account for an ever larger share of the mortgage finance market.

The hedge fund trade and stock market crisis

The typical subprime mortgage hedge fund trade goes like this:

Borrow at lower rates and invest that money into high interest bearing financial instruments.


1. Borrow in Japan paying 2% interest, then convert to US dollars.
2. Invest US dollars in US CMO (collateralized mortgage obligations) paying 8% (subprime mortgages get higher yields).

If that was all that the hedge funds did they would have lost money, but a credit crisis could have been averted.

To maximize the returns (“the greed”), the fund manager asked for a loan to increase his leverage…like buying on margin. This increased leverage on an already leveraged investment increased the hedge funds yield to over 15%!

But as with all over-leveraged positions, this also carries an inherent risk – the dreaded “margin call”.

The underlying value of the CMOs started dropping as a result of the defaults on the underlying mortgages (picture below). Since the CMO itself was devalued, the hedge fund gets the dreaded “margin call” to cover his positions.  The hedge fund manager doesn’t have a Billion dollars sitting idly by so he must look at selling the CMOs themselves to cover his margin…but because everyone is now worried about how deep the defaults go inside the CMO’s, no one is a buyer.

So now the hedge fund manager needing to raise cash fast is forced into selling other stocks, bonds, etc….and the stock market takes a beating.

Mortgage Fraud Rate

Mortgage Loan Fraud

Related Articles:

online remittance

For those of you who want to transfer funds from US/UK to India, the following information might be useful:

My preliminary research suggests that HDFC QuickRemit offers best rates for remittance from US to India.

The exchange rates are as of 16 Jun, 2008.

HDFC QuickRemit

11 – 1000 42.50 50 – 700 82.69 50 – 1000 65.72
1001 – 3500 42.59 701 – 3500 82.79 1001 – 3500 65.83
3501 – 5000 42.64 3501 – 5000 82.84 3501 – 5000 65.89

MSN India 

50 – 1000 42.34 50 – 700 82.69 50 – 1000 65.38
1001 – 5000 42.46 701 – 3500 82.84 1001 – 5000 65.5
5001 – 10000 42.55 3501 – 5000 82.91 5001 – 7500 65.58
10001 – 25000 42.55 5001 – 10000 82.91 7501 – 200000 65.73
25001 – 200000 42.64 10001 – 200000 83.13    
    10001 – 400001 83.13    


50 – 1000 42.34 50 – 700 82.69 50 – 1000 65.38
1001 – 5000 42.46 701 – 3500 82.84 1001 – 5000 65.5
5001 – 10000 42.55 3501 – 5000 82.91 5001 – 7500 65.58
10001 – 25000 42.55 5001 – 10000 82.91 7501 & Above 65.73
25001 & Above 42.64 10001 & Above 83.13    


Currency INR GBP INR
50 – 1000 42.47 £50 – £900 Rs.82.91 
1001 – 2000 42.52 £901 – £2000 Rs.83.01 
2001 – 4000 42.57 £2001 – £3500 Rs.83.06 
4001 – 5000 42.62 £3501 – £5000 Rs.83.16 
5001 – 10000      42.62*  £5001 – £10000 Rs.83.16 * 


On July 01, 2008, I found that
ICICI provides an exchange rate of Rs.42.79339/USD  as against Rs.42.55 of HDFC Quick Remit, for $1000. However ICICI imposes additional $2 service charges. However for $2000, ICICI doesn’t impose the service charges.

Following table should clarify the picture.

Service USD Forex Rate Service Charge INR Remittance Fees INR INR
hdfc 1000 42.55 0.00 25.00 42,525.00
icici 1000 42.79 85.59 25.00 42,682.80
hdfc 2000 42.64 0.00 25.00 85,255.00
icici 2000 42.88865 0.00 25.00 85,752.30

 Sources: and




21 – The movie

I went to watch the movie “21” yesterday. I wanted to watch this movie since it was related to MIT.

I had AMC screen all for myself… well almost 😉 There were less than 10 people to watch this movie show.

The movie was entertaining, but not really mind blowing. Towards the end the story became predictable.

In short, the movie could have been better, much better.

In this movie, Ben Campbell wins Black Jack money twice! But he still has to rely upon conventional ways to pay his Harvard Med tuition.

This thing particularly intrigued me… Even for a movie like this one, they didn’t consider using gambling money  (sorry Prof. Micky Rosa) to pay for the tuition. Ben had to resort to scholarship to pay 300K fees.

So there are certain things which are considered wrong even in a movie 🙂

Huh! thats something….

Pavan’s Guide to nuby desis in US

Dear friend,

Welcome to the US of A. Now that you are going to be here for long, please take time to read this post and  save yourself (and others) some time/energy.

If you are a contractor, I presume that you are on East Coast and most likely in NJ area…..

First thing you would need here is a cellphone and a calling card to call up home (India?).
There are a couple of T-Mobile stores around NJ and NY which help people with no credit to get a postpaid (contract) cellphone.
One such T-Mobile store is Hi-Touch Wireless, Stelton Road, Piscataway, NJ

For cell phones…
a) Sending SMS – Sending and receiving SMS costs money
b) calling up people randomly just because you are bored – Incoming calls are NOT FREE in peak hours

There are lots of options for calling home – Reliance, Airtel, StanaCard etc. Just a Google search will show you many more options. And then there is a whole world of VoIP as well.

Second thing you would need is a bank account – more specifically a Checking Account.

Depending on where you are on East Coast, you may chose your bank. I found Bank of America to be very convenient. Many banks have “Refer a friend” offers, use them to make some free money by the way of referral bonus.

Next thing is getting a Social Security Number (If you studied or worked – F1/H1/L1 in the US in the past, you already have one). Best time to apply for a SSN would be two weeks after your arrival in the US.

Once you get SSN, you can apply for a “Secured Credit Card” which would help you build Credit History.
*** You need to UNLEARN the habit of applying for too many credit cards, late payments and maxing out the Credit Line/Limit ***

Get a driving license too. Except for a few metros (mostly on the East Coast), US public transport sucks. Driving around is the best mode of transport in US. Otherwise you’ll be at the mercy of some one else to transport you around.

The above mentioned tasks would get completed in the first 5-6 weeks of your arrival in US.

In case you are looking out for a job or meeting people for business, consider buying decent clothes in case you don’t have them already.

You need to have a formal suit and a matching tie, leather shoes for attending interviews in person.
Check the weather, address/map, train/airline schedule before you travel. (and need I say carry an umbrella, coat etc.?)

Google/Yahoo is very useful in searching for information on deals on hotels, air tickets blogs etc. Its an essential skill.
Have your contact numbers, address handy (local contact, employer, office telephone/fax numbers etc)

  • Learn to use voice mail effectively
  • Get into habit of checking weather
  • Internet is beyond email, chat, cricket score, movies, mp3s and duh! porn!! So use it effectively
  • You are on your own, so learn to be ***independent ***

So next time, before you bug some one for general information, probably someone like me (who is tired of babysitting fellas) has taken the pains to document it on the internet. PLEASE read it.

Before you start to US ….
There will be an Indian grocery store within your vicinity, which stock ready-to-eat packs, maggi noodles, spices – MDH, MTR; pickles, so avoid carrying this stuff from India. Use your baggage limit for better purposes – viz. home made masala, pickles, chutney powders, sweets you are fond of, mom’s specialties etc.

Carry ready-to-eat stuff for a week or so, just to help you survive in a new place if it doesn’t have a kitchen.

Carry a few $1 bills and a few quarters (25c), they are very handy on the airports.

If you have a cell phone which can work in US, bring it here and you can save $130 with T-Mobile.

Calvin and Hobbes

Each C&H comic strip makes me laugh.  here’s one such:C&H