A study in contrasts- Israel and India

After a week of aerial bombardment of Gaza, Israel has launched a ground attack against Hamas. This came after the ceasefire expired and rockets were launched into Israel. According to the NYT, "After her visit to Paris on Thursday to explain to French authorities why she thought this was not the time for a quick cease-fire, Foreign Minister Tzipi Livni of Israel said, “There is no doubt that as long as Hamas controls Gaza, it is a problem for Israel, a problem for the Palestinians and a problem for the entire region.”"

Islamic separatists and militants, aided and abetted by the Pakistani military (which was humiliated in the 1971 war) , have been launching attacks against Indians for more than thirty years now, and many thousands of Indians have been killed. Yet the Indian government turns a blind eye and treats the situation passively. The pressure exerted by businesses and the U.S. on the Indian government means that this situation is going to continue for a long time.

Condi Rice and George Bush support Israeli action and blame Hamas. According to the NYT, "the Bush administration said it was working toward a new cease-fire, but rather than calling for a halt to military action urged Israel to “be mindful of the potential consequences to civilians.”" But Condi and George both urge India not to use force and to show restraint.

In the world where lives are in the balance, people at the top are playing games.

Need a 'flying' leap of faith

The innocent majority suffers at the hands of a tyrannous, crooked minority.....

This is clearly evident in the vast swaths of people affected by the decisions of the crooked managers and shareholders of the financial firms. The latter exploited everyone from students to seniors, and the majority pays the price.
Same idea- different event- According to BBC, Nine Muslims were ordered off a US domestic flight after passengers heard one of them make what they thought were suspicious remarks....Mr Irfan said when he boarded Thursday's flight, he mentioned something to his wife and sister-in-law about having to sit in the back. "My wife and I are generally very careful about what we say when we step on the plane," he said, adding that they have received suspicious looks in the past. "We're used to this sort of thing - but obviously not to this extent...

In an article titled "Credit Card Companies Take What They Can Get" NYT reports that
"Hard times are usually good times for debt collectors, who make their money morning and night with the incessant ring of a phone. But in this recession, perhaps the deepest in decades, the unthinkable is happening: collectors, who usually do the squeezing, are getting squeezed a bit themselves.After helping to foster the explosive growth of consumer debt in recent years, credit card companies are realizing that some hard-pressed Americans will not be able to pay their bills as the economy deteriorates. So lenders and their collectors are rushing to round up what money they can before things get worse, even if that means forgiving part of some borrowers’ debts. Increasingly, they are stretching out payments and accepting dimes, if not pennies, on the dollar as payment in full. “You can’t squeeze blood out of a turnip,” said Don Siler, the chief marketing officer at MRS Associates, a large collection company that works with seven of the 10 largest credit card companies. “The big settlements just aren’t there anymore.” Lenders are not being charitable. They are simply trying to protect themselves. Banks and card companies are bracing for a wave of defaults on credit card debt in early 2009, and they are vying with each other to get paid first. Besides, the sooner people get their financial houses in order, the sooner they can start borrowing again."

Today's 'real' business news was downright dismal. According to NYT article Manufacturing Reports Show Depth of Global Downturn by Bettina Wassener, "From Australia to Asia and Europe to the United States, the message on Wednesday in the latest economic reports was clear: manufacturing continued to slump amid the worst slowdown since the Great Depression. In the United States on Friday, a crucial measure of manufacturing activity fell to the lowest level in 28 years in December. The Institute for Supply Management, a trade group of purchasing executives, said its manufacturing index was 32.4 in December, down from 36.2 in November. “Manufacturing activity continued to decline at a rapid rate during the month of December,” said Norbert J. Ore, chairman of the Institute for Supply Management Manufacturing Business Survey Committee. This index was at the lowest reading since June 1980, when it was 30.3 percent. “This report indicates that the U.S. economy was on even weaker footing than commonly believed as 2008 came to a close,” said Joshua Shapiro, chief United States economist at MFR. “Moreover, the signal from the export orders index is that the rest of the world is right there with us. Hardly a signal for economic recovery anytime soon.” In addition, Mr. Ore said, “new orders have contracted for 13 consecutive months, and are at the lowest level on record going back to January 1948.” The new orders index was 22.7 percent in December, 5.2 percentage points lower than the 27.9 percent registered in November. No industry sector surveyed reported growth in December; the jobs sector was particularly grim. The employment index was 29.9 percent in December, a decrease of 4.3 percentage points from November. That was the lowest reading since November 1982. In Europe, a closely watched index of purchasing managers showed manufacturing hit a low in December, falling to 33.9 from 35.6. Any reading above 50 signals growth, while a reading below 50 indicates contraction in manufacturing. Similarly grim readings in Australia, China and India highlighted how the Asia-Pacific region has become caught up in the global turmoil. In China, the purchasing managers’ index by the brokerage firm CLSA showed the manufacturing sector had contracted for a fifth consecutive month. The survey showed the steepest decline in its history. With five back-to-back purchasing index readings signaling contraction, “the manufacturing sector, which accounts for 43 percent of the Chinese economy, is close to technical recession,” said Eric Fishwick, head of economic research at CLSA in Hong Kong, in a note with the release. The data added to the flood of statistical evidence from across the Asia-Pacific region showing that activity was slowing faster than previously thought as demand withers in the United States and Europe. Australia’s manufacturing index showed a seventh month of contraction, and a similar survey in India showed activity down for a second month in December. In South Korea, December data showed exports plummeted 17.4 percent from a year ago. President Lee Myung-bak of South Korea pledged on Friday that the government would go into emergency mode to pull the country out of its economic crisis. And in Singapore, the economy shrank 12.5 percent in the last quarter of 2008 from the previous period, causing the trade and industry ministry to lower its growth forecast for 2009. The ministry now expects Singapore’s economy to shrink up to 2 percent, with only 1 percent growth at best. Previously, it had expected up to 2 percent growth. The worsening data, combined with a stream of company profit warnings, production cuts and layoffs, raises the pressure on policy makers to step up their efforts to bolster their economies. India on Friday cut its main interest rate by a full percentage point, to 5.5 percent, and took a series of steps to bring more money into the country. It also raised the limit on overseas investments in corporate bonds to $15 billion, from $6 billion, and will contribute 200 billion rupees ($4 billion), to increase the capital of state-run banks."

Wall Street's reaction - the S&P 500 was up 3.16% today. The same managers who lost a lot of other people's money in 2008 are flying again...

Looking Forward

I came to the United States of America in 1983, and this fall completed 25 years of life in the U.S. I have learnt a lot, and have met many wonderful people. The 1980s were difficult as I worked on finishing my doctorate. It really took a lot out of me. In 1990 I lost my father- that was traumatic. The mid to late 90s were good professionally but were difficult personally. 2001-2003 were very stressful years in my career as the telecommunications industry imploded.

I expect that 2009 and the next few years are going to be stressful as well. Educational institutions will face a decline in enrollments, both due to demographic shifts and due to financial issues faced by parents and students. Some colleges will close. Schools will have to be innovative and deliver real value. While I am tenured, the critical question facing all faculty members is- what should we train the students in, and how? What will let them function fruitfully in these times? Training and experience is sometimes not enough to answer this question- wisdom is required. Here's hoping that Obama, his team, other leaders, and faculty and administrators everywhere have the wisdom that is wisely needed.

Timing is everything....

According to the NYT, "On Tuesday, from 6:30 to 6:50 p.m., and on Wednesday from 9:45 to 10:45 a.m., there was a slowdown at the Common Application Web site, which handles online applications for some 350 colleges and universities. With the clock ticking toward a Jan. 1 deadline, the briefest delay can feel like a full-blown crisis to panicky high school seniors......Seth Allen, dean of admission at Grinnell College and president of the Common Application, said many students worked on their applications for weeks but waited until the deadline to submit them. “I think having an online application has exacerbated waiting till the last minute,” Mr. Allen said, “and if they’re getting timed out on the site, on New Year’s Eve day, that’s certainly going to make them nervous.”"

NYT has another interesting story- "SAT Changes Policy, Opening Rift With Colleges" by Sara Rimer. According to the article, "This March, high school juniors taking the SAT will have the option of choosing which scores to send to colleges while hiding those they do not want admissions officials to see. The new policy is called Score Choice, and the College Board hopes it will reduce student stress around the SAT and college admissions. But when it comes to college admissions, few things are ever simple. Some highly selective colleges have already said that they will not go along with Score Choice, and the policy is stirring heated debate among high school counselors and college admissions officials."

FT has an interesting report titled "Industry’s chance to lure top graduates." It discusses a potential shift in business school graduates to more operational and manufacturing jobs and away from finance, which is where everyone flocked to the past eight years.