Laws of human stupidity and the coronavirus

This article was first published in Yahoo.com on July 22, 2020; https://ca.sports.yahoo.com/news/laws-of-human-stupidity-and-the-coronavirus-101909061.html

Carlo M. Cipolla’s 1988 classic in Italian, translated and published in English in 2011, “The Basic Laws of Human Stupidity” is one of the best books that I have read in 2020, so far. The late author, an Italian economic historian, Fulbright fellow and professor at the University of California, Berkeley, wrote that the book is for “those who on occasion have to deal with such (stupid) people.”

The author further writes, “our daily life is mostly made of cases in which we lose money and/or time and/or energy and/or appetite, cheerfulness and good health because of the improbable action of some preposterous creature who has nothing to gain and indeed gains nothing from causing us embarrassment, difficulties or harm. Nobody knows, understands or can possibly explain why that preposterous creature does what he does.” The book is a masterpiece. Thoroughly enjoyed reading it. The five basic laws of human stupidity enumerated in the book are bang on!

In the times of Corona Virus, when the world is clearly divided into those who are extra cautious and those who believe in Que Sera Sera, it is very easy for one group to feel that the other group is being unreasonable. Those who are extra cautious argue in favour of extended lockdowns, complete isolation and total shut down of all movement and economic activity. They argue that it is required to break the chain and prevent its further spread. The flip side of this argument is that there are many daily wage workers who will die of hunger, especially in countries that have large unorganised workforce. There will be many job losses even in the organised sector, it’s already happening. The extra cautious set of people argue that economy can be revived if we are alive. However, even if we don’t talk of the economy, and just about saving lives, people prefer to die of a disease rather than hunger, as CNN mentioned in a report (https://edition.cnn.com/videos/world/2020/04/21/nigeria-africa-coronavirus-covid-19-lockdown-restrictions-livelihood-busari-lkl-intl-ldn-vpx.cnn).

The que sera sera group of people argue that life must come back to some semblance of normality. We cannot be in a state of perpetual lockdown. We need to make sanitisers, masks and social distancing a part of our lives and start living again. They argue that the risk of spread may be more but ultimately most people will get Covid19 and by being in extended lockdown we are only postponing it. The idea is to flatten the curve to prevent overburdening our healthcare system but beyond that it is not possible to be in lockdown till the virus is eradicated completely or till a vaccine comes to the market. The flip side of this argument is that there are chances of exponential growth again if the lockdown is eased. Not everyone may have access to preventive measures and the healthcare system may be better prepared but will not be absolutely prepared.

Based on the above arguments posed by both sides, each side feels that the other side is being “stupid”. The “extra precautious” group [EPG] feels that because of the other group [the que sera sera group (QSSG)] more people will get the virus and even QSSG will not be spared. The QSSG feel that the EPG is suffering by being in a state of paranoia and making the QSSG suffer too because of all the restrictions. Since one group feels that the other group is stupid, according to one group, they themselves are non-stupid. But the other group feels that the other group is stupid. Making both the groups stupid in the process. This validates the first law of stupidity that says: “Always and inevitably everyone underestimates the number of stupid individuals in circulation”.

What has happened is that two otherwise educated, qualified and well-read group of people who are perfectly capable of taking intelligent decisions are also found to be at the two ends of the spectrum when discussing the ways to deal with this virus. Consequently, one intelligent person seems stupid to the other intelligent person, justifying the second law of stupidity: “The probability that a certain person be stupid is independent of any other characteristic of that person”.

Now coming to the 3^rd basic law of human stupidity, “A stupid person is a person who causes losses to another person or to a group of persons while himself deriving no gain and even possibly incurring losses.” Let us look at an example: A person hell bent on not maintaining social distance and “forgetting” to not touch or pat or hug can give anxiety to the other person while herself being in danger of contracting the virus or spreading it if she is an asymptomatic carrier. But this person is a carefree person and will never realise the gravity of the situation. Take another example: There are volunteers working across the world to keep people safe, providing for food and essentials and educating people. Some people abuse them rather than appreciating them. As a result, they lose well-wishers, lose supplies and may contract the virus too. In return, they also succeed in lowering the morale of those who were working relentlessly for their safety and well-being. Everyone loses in this scenario.

Law 4 states that “Non-stupid people always underestimate the damaging power of stupid individuals. In particular non-stupid people constantly forget that at all times and places and under any circumstances to deal and/or associate with stupid people infallibly turns out to be a costly mistake”. It is infact being experienced by many of the well-wishers, administrators and leaders. Under pressure from the abusive, damaging and demoralising comments from stupid people, the non-stupid people are taking a back seat, leaving things to fate or giving in to the demands that are compromising on safety. However, in times of Corona, giving in may result in dire consequences that the stupid people never imagine or are unwilling to accept, and the non-stupid people underestimate.

When the non-stupid people give in to the demands of the stupid people, they should remember the fifth law of stupidity, “A stupid person is the most dangerous type of person. A stupid person is more dangerous than a bandit”. Before acquiescing to the stupid people, the non-stupid people must think of the consequences of pleasing stupid people. Stupidity or should we say “Covidity” will spell doom for everyone. Non-stupid people must beware and take charge!

The need of the hour is “Balance”. Being a part of EPG may work for some time but these people risk running out of patience when it might be needed the most, when then governments eventually lift all restrictions on movement. The QSSG group put themselves and all others at risk by not taking adequate precautions. Adopting a balanced approach by taking adequate precautions is required. As the number of Covid cases in India have raced past the five-lakh mark, remember that Covidity cannot be controlled. We cannot control what others do and neither should we. We can only control our own actions. So, take adequate precautions. Be safe yet balanced to maintain your own sanity.

NPAs are everybody's problem

This book review was first published in Business Standard on July 10, 2020; https://www.business-standard.com/article/beyond-business/npas-are-everybody-s-problem-120071000014_1.html

Vivek Kaul's Bad Money: Inside the NPA Mess and How it Threatens the Indian Banking System provides the answer and I am wiser years after having taken the loan

Book: Bad Money: Inside the NPA Mess and How it Threatens the Indian Banking System

Author: Vivek Kaul

Price: Rs599/-

Pages: 339

Publisher: Harper Business, an imprint of HarperCollins Publishers

When I was a fearless in twenties something, sometimes broke, research scholar, I went ahead and bought an under construction flat. I took on a home loan that covered 85% of the cost of the flat and a personal loan that covered the remaining 15% that was used for the down payment. After paying the EMIs, I would have barely enough to pay my share of the rent of a 500sft apartment shared by 3 or sometimes 4 friends and eat three square meals a day. I had started walking longer distances instead of taking autos, I stopped going to the Café Coffee Day and for shopping, unless for essentials. I sold the apartment soon enough at double the price.

In the recent years, whenever I have taken a loan, bogged down by the paper work, my thoughts always go back to those days and I always wonder how did someone like me, with no guarantors, on a stipend (not even a salary) and no credit history ended up getting the loans back then?

Vivek Kaul’s “Bad Money: Inside the NPA Mess and How it Threatens the Indian Banking System” provides the answer and I am wiser years after having taken the loans. Those were the years, 2005-06, when the bad loans rate was below 5 percent and hence the banks had “decided to go easy on their lending” and the growth rate of lending was highest around this time.

Last year, a friend lost her job and defaulted on the EMIs of her car loan and after the fifth month of default, two employees of the bank came and took her car away. She asked me, “How is it that Vijay Mallya and Nirav Modi get away but people like us can’t?” I had jokingly replied, “well you could get away too if you absconded to another country with the car.” Last week, I asked her to read Kaul’s book in which he lucidly explains why ‘If you owe your bank a hundred pounds, you have a problem. But if you owe your bank a million pounds, it has,’ as John Maynard Keynes had remarked and modified by the Economist [magazine] as “If you owe your bank a billion pounds everybody has a problem.” She read the book and called to thank me for suggesting it.

As evident from the above examples, Kaul’s book, if read with the attention it deserves, helps everyone, not just the economics and finance students and practitioners, to understand how developments in the banking sector and the various cycles of lending, NPAs and regulations have implications for everyone. The decisions taken over time slowly and steadily weave an invisible mesh of mess that gets noticed only when someone like a Mallya or a (Nirav) Modi gets trapped in that web and catches the imagination of the nation. How does this mesh get woven? That is what Kaul traces and explains in his book.

“Bad Money” is a focused saga of the banking system in India that includes the creation and evolution of the public sector banks, nationalization and privatization, regulations by the Reserve Bank of India such as the Insolvency and Bankruptcy Code, 2016 and how the politics too played out along the way. It goes back and forth like a “Tarantino movie”, as Kaul puts it, goes into the back stories, the sub-plots and the numbers that substantiate the stories.

The problem with the book lies in its strengths. The book is focused and hence it may not seem appealing to readers who look for more broad-based books on the economy and the financial system. However, once they pick up the book, they will find that it does take an overall view of the financial system while keeping the banking system at the centre. The book also throws a lot of numbers and graphs at the readers that may act as speed breakers, in an otherwise fast paced book, while reading though they make the book more authentic in its analysis.

The book is a one stop shop for anyone looking for references on the Indian banking system. One can only marvel at the number of books, monographs, articles, and documents from various websites that have been referred to. Anyone researching related topics need not look elsewhere and may be able to add only a “delta approaching zero” to what Kaul has written. This book organises the messy material and presents the “long and short” of it in a readable, understandable and relatable manner.

Reading is akin to breathing

This post is inspired by Oneknitatatime:

https://oneknitatatime.com/2020/07/08/knitting-versus-reading/?fbclid=IwAR2MAT4obzDzuTqyEw47IFAblyvjFmMhiw8cGhMSN1IMC424LXnqwUDY9DQ

Dear Kni-der,

Your post brought back memories of the times when I used to borrow comics, magazines and books on rent in the small town of Ramgarh as it lacked a library. I remember making a trip to this small store called the “Shreeji Stores” with Rs 2 or 3 in one fist while carrying the pile of read treasure in the other almost daily. In those days, even those Rs 2 or 3 were not easy to get and I had to beg (well, not literally, but it wasn't easy) for them many a times.

I became more academic oriented and slowed down on reading as I went to a boarding school and during the 11^th and 12^th classes. After that, I do not remember a day when I have not read. When pursuing my CA exams, I would place books inside the accounting and auditing books and read them while pretending to study. It was important that I passed the exams in the first attempt and I could not give the impression that I did not study well just in case I failed. Thankfully, I did not fail.

Book purchases became the largest expense category on my credit card. I especially got bookshelves designed when we bought the house in which we currently live. The shelves were designed to accommodate books bought over the next 25 years but are already overflowing. Meeting authors, getting first editions, author signed copies and going for book readings all made me excited. The importance of books in my life is so profound that on my first birthday after marriage, my husband gifted the complete collection of Jeffrey Archer’s books to me, signed and addressed to me, by him.

As recently as in 2018, on a trip to Ramgarh, I went to Shreeji Stores and asked the bhaiya, who  was perhaps a teenager when I used to borrow the comics and magazines, if he still had that collection. I was interested in buying the entire lot if he did. Sadly, he did not. He did not exactly recall it but guessed that it was sold off to the scrap dealer during one of the store revamps. I was left with a feeling of emptiness for a few days at least.

I have never wanted to be a librarian. The thought never crossed my mind. But the quest to open a “chai aur kitaabein” parlour where people come, settle themselves down with a book, regular and unlimited supply of tea and snacks as they keep reading, no hurry to leave and conversations revolving around books, is a retirement plan that I keep mulling upon. Tea being the other love of my life.

Netflix and Prime became the prime contenders for the scarce time in the last few years. And like you, I did not like it. I do not like it. I started exploring audiobooks then and hated it. I would miss entire paragraphs, would go blank at times, kept rewinding, and missed the feel and smell of paper. For the record, I never enjoyed reading on the Kindle or e-books on iPad too. Coming back to audiobooks, after trying a couple of books, I gave up audiobooks as well as Netflix and Prime. I lived happily ever after for many months, just reading, and reading whenever I could during the day and compulsively at night.

I have been driving to work for 14 years now. I bought my first car in 2006. Since then, listening to music to and from my workplace became a ritual. I would spend hours updating my playlists at least one weekend in a month, adding new songs, organising old ones, making folders like “most favourite”, “just favourite”, “okay”, “not-so-good”, “latest”, and so on. About two years back, I started to get bored of listening to pretty much the same songs since 2006 for the “not-so-good” and “okay” hardly ever got played and very few songs from latest made it to the “favourite” or “most favourite” lists. Once again, I decided to listen to an audiobook. Dan Brown’s Origin had just released, and I downloaded the book on audiobooks.com with the free credit available with the trial version. The rest as they say is history.

I bought the Bose wireless, noise cancellation, sweat-proof, earbuds. They have been my constant companions for all non-car listening to audiobooks. I have subscriptions for audible, audiobooks.com and storytel. I mix paper books and audio books. From cooking to cycling, driving to dusting and shopping to sanitising, I listen.

A key takeaway from “hate at first listen” to “love of my life” now, is that the first book should always be one that is fast paced, is a thriller and one that you want to get to the end as fast as possible. I do not recall the book that led to the “hate” experience. But I do recall sitting in the parking lot of my office a bit longer so that a chapter of Origin gets over. I do remember going back to my car to get my earphones during the lunch time so that I could listen to the book when eating. I do remember avoiding friends during the evening walk so that I could listen some more. So, to all those who are still trying to get used to audiobooks, listen to some recommended crime fiction initially or a genre that you enjoy the most. Once you get used to listening, there is no looking back.

The number of books that I read/listen to has increased manifolds with audiobooks complimenting the paper books. I do miss listening to music at times. But let us face it. There are hardly any good new songs getting released now a days. I switch to music occasionally to revisit the old favourites. Netflix and Prime have entered a rationalised zone and there are rare spells of binge watching. Overall, to quote you dear Kni-der, “Life is good again!”, my old friend is the center of my universe again!

Happy reading/listening.

N