Wednesday, June 24, 2015

Implementing smart cities

Implementing smart cities

Smart city is the latest buzz-word in urban development. Conferences and seminars on smart cities abound. The Government of India (GoI) have committed to the development of 100 smart cities across the country as satellite towns of large cities and by modernizing the existing mid-size cities. The government have also allocated over Rs 7000 Cr in the last Union Budget for kick-starting smart cities.

Stripped off all jargon, a smart city is one which uses the latest technologies, progressive urban planning, and proactive civic engagement to create a highly liveable urban environment. It deploys citizen-centric and sustainable policies and the latest information and communication technologies to improve the quality of life of its citizens and public service delivery. Its immediate attraction comes from certain technology interventions that have the potential to dramatically improve urban governance capabilities. 

Intelligent traffic management systems, which integrate the feeds from all existing hardware - cameras, signal lights, GPS devices in various vehicles, wireless and other police communication systems etc - can be a powerful force multiplier in traffic and law and order management. Real-time monitoring of electricity feeders and reservoir fillings can help improve the reliability of electricity and water supply besides lowering leakages. Geo-tagged dumper bins and location tracking devices on vehicles can improve solid waste management. Ambient light sensors can help optimize on energy consumption in streetlights. Street parking slots can be sold using parking meters and status of parking locations made available on smart phone applications.

Lidar and biometric technologies can help improve the monitoring of engineering works and attendance respectively. Finally, smart data analytics coupled with cognitively striking visualization, like that in many developed country cities, can help city governments use the vast amounts of information accumulated by its departments as decision-support to more effectively manage civic services, reduce wastage and increase revenues, and limit accidents and crime.

All these have the potential to both improve operational efficiency and enhance consumer satisfaction. In fact, the biggest contribution of such applications would be to improve the capability of municipal governments to deliver public services.

But implementing these technology applications raises three challenges – identifying interventions, standardizing protocols, and scaling up interventions. The first requires demand-side engagement. Cities need to elicit this information through focused engagement with its citizens and utility managers. Given scarce available resources, we need applications that are likely to yield the greatest bang for the buck in a particular city or its part.  

Even after the intervention is identified, there is nothing available in the market to be purchased and deployed with minimal customization to meet some or all of the aforementioned applications. Further, where available, those applications are made for developed country environments, with vastly different challenges, and most unlikely to succeed in India even with significant modifications. 

In the circumstances, we have a classic co-ordination failure. The market needs the platform of a city to develop and refine a smart city applications suite. Businesses, especially the larger ones, rarely have the appetite to risk huge money upfront to develop a new product with several risks and uncertain commercial prospects, and that too in a market where governments are the biggest customers. On the other side, governments are naturally unwilling to embrace a completely new and untested product and have limited patience to wait out the time required to realize its benefits.

Such co-ordination failures are most likely to be mitigated through concerted public policies. Traditional procurement strategies are off the table. A few pilot projects in certain geographically distinct pockets within cities, involving close collaboration of governments with technology providers and system integrators, preferably smaller and emerging entrepreneurial firms, looks the best bet forward.  

As a first step, a Detailed Project Report (DPR) of the aforementioned applications will have to be prepared, outlining the specifications of the devices, connectivity, and software solution. The DPR will emerge after pilot field-testing of various alternative hardware and network technologies for each application. It will study existing process and outline how these smart city devices and applications can be seamlessly plugged into the municipal government systems. It will also undertake a cost-benefits analysis, duly arriving at the financial and economic rate of returns for the project. The specifications should help define inter-operability standards and mandate open-standards based software solutions. This would help create an eco-system where app developers can plug their software and enrich the smart city project.

This pilot project would require atleast 6-9 months to develop a robust, versatile, and user-friendly solutions suite. It will have to emerge through a process of continuous iteration, involving tight feedback loops managed by the selected implementing agency, working in close collaboration with the municipal government and citizens. Once the solutions suite and DPR is developed, it can be scaled up elsewhere.

As a note of caution, we need to avoid the temptation to implement glamorous first-best solutions involving latest sensor technologies and devices designed for vastly different environments. Atleast in the first phase, solutions have to be decidedly second-best, designed with the objective of realizing the low-hanging fruits from improvements in administrative efficiency and citizen satisfaction. We should also learn from the experience of some of these applications which have been implemented, with varying success, in cities across the country.

More important than the devices themselves, the software suite that integrates all these devices have to be robust, versatile, and extremely user-friendly. A software suite that integrates all these different applications into a single platform and renders information in a cognitively striking visualization dashboard can be a force multiplier for public officials. If made available on different devices including smart phones, this can be powerful decision-support for municipal field functionaries and help dramatically improve their execution and supervision bandwidths.

Such technology interventions have to be complemented with more fundamental policy initiatives. Policies that permit higher Floor Area Ratios (FAR) along important transit corridors and near transit stations promote transit-oriented growth which reduces traffic congestion. Densified mixed-use developments with adequate public spaces, especially in larger plots and green-field locations, promote walkable work-life environments. Higher FAR and property tax concessions, complemented with affordable housing mandates, encourage urban renewal through re-development of blighted areas. 

As with all buzz-words, there is the danger of hype overtaking substance. Amidst all the hype, we would do well to bear in mind that India’s urban development imperative is not so much smart cities as decently governed cities. Numerous studies have highlighted that the governance systems that drive the engines of India’s economic growth are woeful, even dysfunctional.

Friday, June 19, 2015

Is the Stock Market Going to Crash Soon?

Is the Stock Market Going to Crash Soon?

Dear Ritesh,

I've been reading a ton about the stock market hitting more new records. Does this mean a crash is coming? What should I do?

Sincerely,
Intimidated Investor

Dear Intimidated Investor,

There are a few levels to your question, but let's start with the main one: Is the stock market going to crash?

Yes, absolutely. That's the easy part. Is it going to crash now? Well...that, we don't know.

The Market Always Cycles

As long as there has been a stock market, it has gone up and down. In this chart of the chart, you can clearly see how the stock market has continually moved in cycles from 1998 to the present.

Two things stand about the chart:
  1. The market follows a cyclical pattern: it goes up, then down again, then up again, down again, over and over. That makes it a no-brainer to declare it will go down again—it always does. Always.
  2. The good news is: it always goes up again, too. The news gets even better: as you can tell from the chart: the ups outweigh the downs by handsome margin over time.
Before we continue, let's clarify what we mean by a crash. The market never goes up in a straight line: there are always dips and peaks as it generally moves up. However, there are a few drops which goes way beyond what we could call "normal." Two recent examples were the "dot-com" bust right after 2000 and the 2008 market crash. If you look at above Google Finance chart of the sensex you can see the distinction between the small dips and two major crashes clearly:
Now you can see why saying the market will crash is the easy part — it always does. The hard part is: when will that happen next?

Peaks Do Not Equal Impending Doom

No matter what anybody tells you, nobody knows when the market will drop. No matter how many degrees someone has, how many crore they made or how many books they sold, the fact is nobody can tell the future consistently and accurately. For example, take a look at this chart of the stock market, with the dates stripped away. It just reached a peak, so is it ready for a crash?

Is the Stock Market Going to Crash Soon?
It's hard to tell. You wake up in the morning and you see the beginning of a little dip there in the top right hand corner. Oh, man! The market has (as you can see) been growing for a while, so is this the time that it does its cyclical crash thing?
As it turned out, no. Here is the same chart continued. The dotted red line shows where it was that critical morning when you woke up and wondered:
Is the Stock Market Going to Crash Soon?
The fact that the stock market is at a peak is no predictor of a major crash.

True, every crash is preceded by a peak, but not every peak is followed by a crash. In fact, as you can see from the chart above, there are hundreds of peaks which are followed by higher peaks. So, don't let anybody point you to a peak and proclaim that it presages a crash.

So, what about those talking heads who keep predicting imminent doom, especially the ones who claim they called the previous one(s)? They're playing a game involving math and memory. The math part says if they say every month the market will crash, sooner or later they'll be right (see above). Then (the memory part) they hope you forget all the times they cried wolf, and they'll crow, "See! I told you the market was going to crash! You can get my book at Amazon for Rs.250." They might even try to sell you a subscription service at Rs.2,000 a year. (Hey, if you fall for the book, who knows? You can't fault them for trying!)

But the bigger question for you is…

What Should You Do?

Now that you know you don't know, and never will know, when the stock market's going to crash, what should you do? Or, don't do?

Your clue is that first chart. Take another look. The market always recovers and reaches a higher peak.  The peak following is the only one lower than the previous peak. All the other peaks were higher than any preceding peak.
What that means for you is two things:
  1. The market will recover. It always does. It never feels like it when everyone is all doomy and gloomy, but it does. And then it goes even higher than before. If you simply keep doing what you did before the crash, you eventually recover and reach higher highs.
  2. Whenever the market crashes, the smart investors like Warren Buffett swoop in and scoop up all the bargains they can get ("Fire sale!"). They do that with cash they set aside and don't invest when the market is on the high side.
High side? Really? How can you tell? Here is how you do not tell: the charts you looked at above.
Say what? We spend all this time looking at the charts and now they're not what we should look at?
Right. At least not to determine if the market is overvalued. Let me explain.

How to Look at the Price of a Stock

The numbers you see every day on the news reflect the price of the market, just like it reflects the price of a stock. But the price of a stock doesn't tell you if it's expensive or not.

Let's take two examples I love using: A Stock is IT company and B stock is pharma company. A stock price is around Rs.120-130 these days, while the B stock price is around Rs.55 So, does A stock have more value?
No, B is twice as expensive, even though it's half the price. When valuing a stock, we don't look at the price, we look at the price as multiple of their earnings.

A stock trades at a PE ratio of around 17 times its earnings, while B trades at about 34 times earnings. That means you pay twice as much for B Market's income stream than you're paying for A. That's why B stock is twice as expensive as A. (And you thought only the stuff they sell was expensive.)
The stock market is nothing but the combination of all the stocks trading there. Like an individual stock, the market as a whole therefore trades at some multiple of the earnings of all those companies.

These days, the NIFTY (the total of the 50 largest stocks) trades at a multiple of about 21 times earnings. So, is that high or low?

This isn't something doomsdayers like hearing, but the market's PE ratio of 21 is pretty close to its historic average, as you can see from this chart:

The chart clearly shows how the market's PE ratio went out of whack (scientific term, according to My Cousin chandu) at the time of the major market crashes.
Now, you tell me: is the market's PE out of whack at the moment? I don't think so, either. 
Again, nobody knows what the future holds, but it's hard to make the case that the market is overvalued today, despite the weekly new market highs. Stock prices are high because companies are reporting good earnings.

Regardless of whether the market is ready for a crash, the best strategy for most people is to just keep doing what they're doing now.

So, as Conman investor What Should I do, I am still confuse with stock selection should i buy Pharma stock or Infrastructure stock or banking?.

I personally fill one should buy Diversified Mutual Funds instead of buying stocks,

and  next question will be when to buy Mutual Fund


The father of value investing, Benjamin Graham once wrote that making money on investing should depend “on the amount of intelligent effort the investor is willing and able to bring to bear on his task” of security analysis. He defined the intelligent investor as an enterprising individual that has the time and energy to do his or her own investment research. In contrast to the intelligent investor is the defensive investor who would prefer to have another individual pick stocks, bonds and other financial assets on his or her behalf. Hiring a financial advisor is certainly one alternative, but most retail investors (and also many institutions) prefer to hire a manager through the purchase of a mutual fund. Below is an overview of when it might be a good time to invest through the purchase of mutual funds.

There is money to be made in mutual funds, but investors fall into several pitfalls that keep them from maximizing their profits when investing in funds. Getting too focused on short-term results can be a big problem. As with individual stock, chasing performance can be a large negative when buying mutual funds. For starters, there is little evidence to suggest that a mutual fund manager that performs well for a quarter, or even a couple quarters in a row, has investment skill. Short-term fluctuations are arguably random. The only surefire way to determine if a mutual fund manager has more investment skill than luck is to measure his or her performance through a full market cycle of three to five years. A manager with a few bad quarters, but a great long-term track record, could still end up being a great mutual fund to buy into.

Investors also have a track record of chasing performance and this can have significant impacts on mutual fund performance. As alluded to above, buying into a fund following a strong short-term run and great performance is unlikely to be repeated unless the manager has a solid long-term track record. Fund flows can also end up hurting performance. Mutual fund managers in small-cap stocks can start to lag if they become too popular; with high asset levels it can become too difficult to find opportunities in smaller companies. Rapid inflows and outflows can also hurt performance because the mutual fund manager may be forced to invest new funds or sell to meet redemption, which means she or he is forced to make buy or sell decisions that may not be based on if a stock or bond is a good value at the current price.

Benefit by investing through SIPs

The biggest benefit of a SIP is that it allows one to invest regularly without being bogged down by questions about the right time to jump in. SIP is not a product or a fund. It is simply an investment process. Instead of basing investment decisions on expectations of how the market will behave, SIPs facilitate a disciplined participation in the market through ups and downs. Since a fixed amount is invested across time, SIPs enable a reduction in average cost. Therefore, the returns from an SIP are not likely to be different from those of the mutual fund in which the investment is made.

No point in comparing lump-sum investments and SIPs. I have seen research trying to establish when and under what conditions a SIP can beat lump-sum investment. Actually, they are two completely different ideas, and the latter will typically beat SIPs. When you invest a lump sum, a larger chunk of your money works for a longer period of time.
On the other hand, a SIP is a slow model, where you build your wealth with each installment. Had you invested Rs 10,000 per month in the Sensex since its inception in 1979—406 months in all—you would have about Rs 1.6 crore today.
A lump-sum investment of the same amount, Rs 4.06 lakh at that time would be worth over Rs 8 crore today. If you have a lump sum handy, you are better off not trying to go for an SIP unless you think the market is falling and you want to invest at lower levels.
The Bottom Line

When it comes to buying a mutual fund, investors must do their homework. In some respects, this is easier than focusing on buying individual stock.


-- 
Regards,
 
Ritesh.Sheth CWM®
CHARTERED WEALTH MANAGER

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Sunday, June 14, 2015

India among the top 10 most natural disaster prone countries for insurance firms  Source: Business Standard

India among the top 10 most natural disaster prone countries for insurance firms

BS Reporter | Pune Jun 09, 2015 06:18 PM IST

India ranks among the top 10 countries when it comes to natural disaster risks according to Bajaj Allianz. And with natural disasters like the Jammu & Kashmir floods, Uttarakhand landslides, cyclone HudHud becoming more frequent, the firm believe that India's ranking in flood risk may increase further.
India along with countries like Japan & Philippines makes to the top 10 natural disaster list with propensity for natural disaster such as earthquake, cyclone and floods. This means that insurance firm covering natural disasters need to take a higher insurance cover, but premiums in India are lower than countries like Philippines.
"India is high on the peril ranking list, as it has floods, earthquake and cyclones. At present India is modeled on earthquake disaster, unfortunately there is not much of a modeling done on floods. Flood is a difficult natural disaster to manage and model as India as a country has a topography that is constantly changing," said Tapan Singhel, MD & CEO, Bajaj Allianz.
Insurance companies have data compliers who have models on natural catastrophes like earthquakes. Bajaj Allianz has built models on earthquake as it also has historical data to fall on but for flood the company has started to create model only on the 26/7 Mumbai floods.
Bajaj Allianz was one of the insurance companies that had high exposure to claims from the J&K flooding. The company settled 28,000 claims and disbursed Rs 1,000 crore in a period of three-three-and-a-half months. Bajaj Allianz has a 23-24% market share in J&K.
In early September of 2014, monsoon rains in the northern state of Jammu and Kashmir in India and the neighbouring region in Pakistan resulted in the worst flooding in 60 years. At least 665 perished and over 200,000 houses were destroyed. Together, the total losses in India and Pakistan were $5.9 billion (Rs 36,698 crore), and insured losses were at least $0.2 billion (Rs 1,244 crore). The total losses from the destruction of housing in India were at $4.4 billion (Rs 27,368 crore).
Cyclone HudHud caused the largest loss from a tropical cyclone, said the study. The total losses were estimated at $7 billion (Rs 43,540 crore), the largest of all natural catastrophes in the world in 2014. However, the insured losses were a fraction of the total at just $0.6 billion (Rs 3,732 crore).
Despite an increase in natural calamities the number of people buying home insurance or insurance for natural disaster has not increased. "Such natural disasters create interest for just a few weeks and then its business as usual. In India less than one per cent of home buyers buy insurance coverage. Those who have been buying are doing so because of the home loan they have and that mandates an insurance plan," said Singhel.


India GDP growth graph of the day

India GDP growth graph of the day

India's revised GDP numbers have been variously called as puzzling and confusing. Now, Andy Mukherjee draws attention to describes it as a statistical illusion. He constructs a proxy indicator for growth by combining three parameters - corporate earnings (reflects private investment), auto sales (proxy for consumer demand), and software imports (captures productivity gains) - and compares it with the actual GDP growth rate. 


The divergence in the two trajectories, especially since Q4 2012, is striking. In fact, by this indicator, atleast one-third of the GDP growth appears a statistical illusion.

Investment-demand constrained economy

Investment-demand constrained economy

The latest macroeconomic data releases for India show that the gross fixed capital formation continues on its downward trend, non-food credit growth has dipped to single-digit, and corporate bottom-lines are at their weakest in a long time. Pointing to concerns that the turnaround may not be around the corner, Livemint highlights the capacity under-utilization problem,  
Key industries have huge capacity underutilization. In steel, from a maximum of 88% in 2012-13, utilization level is expected to be 84% in 2015-16. In cement, from a peak of 74% in 2011-12, utilization is down to an estimate 71% in 2015-16. In automobiles, this number is down from a peak of 80% in 2011-12 to an estimated 63% in 2015-16.
Apart from this, real estate market inventories have been piling up. The RBI's own survey shows manufacturing capacity utilization at 71.7% for Oct-Dec 2014, with no signs of a reversal. These trends do not point to any resumption of the investment cycle.


Signatures of consumer demand, for capital goods and consumer durables, too are not promising. As the RBI survey shows, order books of capital goods manufacturers has been declining. And in any case, businesses and banks are hobbled with bruised balance sheets.Business sentiment, as captured in the Business Expectations Survey of March 2015 conducted by the think-tank National Council for Applied Economic Research which tracks over 500 firms of varying sizes, had fallen 6.9% from previous quarter.

All this appears to point towards currently India being an investment-demand constrained economy. If this is true, monetary loosening, for all the hype surrounding it, would be pushing on a string! In any case, all this makes these numbers even more puzzling.

Increasing the utilization of JDY accounts

Increasing the utilization of JDY accounts

The biggest concern with India's Jan Dhan Yojana (JDY), in which no-frills accounts with zero-balance are opened to achieve financial inclusion, is with its actual utilization. A large majority of accounts have not been transacted on and very few have had meaningful enough transactions.

In fact, acknowledging this possibility, the government had designed the JDY with multiple incentives. In fact, the scheme has atleast five incentives as top-ups - a zero-balance facility (against the Rs 1000 minimum deposit requirement in regular accounts), a RuPay debit card, a Rs 1 lakh accident insurance, and Rs 30,000 medical insurance for the poor, and an over-draft facility of upto Rs 5000 per household. It was premised that these incentives would promote the bank account utilization. Now that incentives have not proved sufficient, the next dimension is being pursued is to enable access - through increased banking correspondents and even mobile telephones. 

Both incentives and access are doubtless essential to improving account utilization. But if experience from across the world is any indicator, this is unlikely to bridge the last mile gap and get households to use the accounts. Such persistent last mile gaps are more amenable to nuanced behavioral interventions or nudges. Here are atleast three nudges that have the potential to complement incentives and access and bridge the last mile gaps, thereby increasing the actual utilization of JDY accounts.

1. Multi-tier accounts - Behavioral psychologists highlight the importance of mental accounting, whereby people mentally categorize their incomes into different use-directed buckets. Accordingly, people are more likely to save when they desperately want to save for something and have a mechanism to save for it - eg. people use piggy-banks or lock-boxes to save for buying a bicycle or mixer-grinder. In fact, at any time, most poor people use some version of this to save for certain highly valued purposes. Therefore, a multi-tier savings bank account, where people can customize tiers based on their needs, has the potential to be a powerful nudge to get people to start using bank accounts.
2. Lotteries - People, poor and rich, are instinctively attracted to gambling. Lotteries find great attraction among poor people, in particular. In fact, the vast majority of lottery customers come from the lower half of the income ladder. Lottery schemes, like chit funds, which offer investors in recurring payment savings schemes with defined tenures the possibility of windfall payouts are wildly popular among poor people. A periodic lotteryoffered to active users, through prize-linked savings bank account, can be a powerful nudge to get them to start using the JDY accounts. There is growing evidence of lottery schemes being successful in increasing savings.

3. Commitment contracts - People have a time inconsistency problem whereby they have different preferences on current and future choices on the same issue. Accordingly, while the current-self attaches a high-value to exercising tomorrow morning, the future-self discounts it heavily when tomorrow morning arrives. Consider this example. When they receive their lumpy harvest income, farmers are committed to saving enough to buy fertilizers for the next crop and not fritter it away on festivals or temptation goods. But come the festival or another temptation need, this resolve breaks down, leaving the farmer with too little to buy the fertilizers or make ends meet till the next harvest arrives. So how about a harvest annuity scheme or fertilizer savings account, with attractive enough savings returns, attached to the JDY account, that helps farmers amortize atleast a part of their incomes till the next harvest thereby optimizing their income management or pay for fertilizers for the next harvest. These are examples of commitment contracts that help tide over the time inconsistency problem. Successful outcomes from some such commitment contracts are summarized in a recent report in Science journal highlighted by this WSJ report.   

These are not to be seen as stand-alone strategies, but part of a menu of choices linked to the JDY account and readily available for the account holder to choose from based on their preferences and needs. Their enrollment/subscription processes should be extremely simple and user-friendly, so as to lower the access barriers and costs. Finally, they have to be aggressively marketed through information and education campaigns that reach these customers. Though the potential for their abuse is considerable, the predominantly public nature of banking sector, especially those servicing the poor, should mitigate those risks. 

None of this is to argue that this can be a guarantee to increasing the utilization of JDY accounts. It is just that this approach, coupled with incentives and access that is being promoted by the government, stands a greater likelihood of success with promoting real financial inclusion.

Steel sector, stressed assets, and asset sales

Steel sector, stressed assets, and asset sales


Livemint writes about the struggles of steel sector in India,

The country’s consumption in April-March 2015 was at 76.3 mt, 3.1% higher from a year ago... in fiscal 2015, India imported 9.3 million tonnes (mt) of finished steel, 71.1% higher from a year ago, while it exported a mere 5.5 mt.... As of 16 April, Indian hot-rolled steel prices stood at Rs.39,681 per tonne or $627 per tonne. Prices of HRCs from China and Russia were significantly lower. According to Bloomberg, HRCs from China were priced at $387 per tonne. Even after adding shipping and transportation costs and export duty, the price added up to around $520 a tonne...Prices of Chinese flat steel products, which now meet the quality standards of established Indian companies, are usually 15% lower than Indian steel prices, thereby making imports very attractive... Russian prices were similar to those of Chinese imports for the past few months. 
And this about the domestic steel industry's finances,
According to data from the Corporate Debt Restructuring (CDR) Cell, as on 31 March 2015, of the Rs.2.86 trillion in loans being restructured, 19.7% or Rs.56,443 crore worth of loans came from the iron and steel sector.
Apart from this, 41 steel sector projects worth Rs 4.6 lakh Cr formed 10% of all stalled projects being monitored by the Project Monitoring Group (PMG). In light of the above and the strong likelihood of the trends persisting, it is highly unlikely that too many promoters will be interested in taking forward these projects. These stalled projects may therefore be as good as cancelled. 

In the quest for deleveraging, Indian corporates, including steel companies, are taking desperate measures. Livemint has another story about firms selling their core assets (mainly to infrastructure funds and infrastructure-focused leasing companies) and leasing it back through a 'sale-with-a-right-to-use' model. Firms sell the asset and enter into long-term contracts to use the equipments for their production. The deals mentioned in the story involve heavily over-leveraged firms, clearly revealing the motivating factor for such deals. However, while such sales help firms monetize non-liquid assets and reduce debt, especially important for debt-laden firms, they also raise operating expenses and thereby production cost. When deleveraging is completed, these firms are likely to face up to the reality of higher production cost and look for buying back the assets. But why should their new owners relent?

It makes very attractive commercial sense for investing in such assets. Given the assured incomes that come from the contracts, with minimal downside risks (albeit limited upside too), investors with patient capital like pension funds should be queing up. It is therefore no surprise that infrastructure funds and leasing companies and jumping into the market. But do these firms have the expertise to manage the operational risks? Or is is just another one of the fads that suddenly strike because of a market opening trigger (deleveraging by firms, here) for capital to rush in head-long and burn their fingers? Further, is the contracting likely to be clean, which minimizes the possibility of contracting disputes? Is it possible to effectively ring-fence asset-ownership and operational sides? 

Fundamentally, this raises the issue of whether the Coasean bargain is attractive enough to pursue such a business model in manufacturing sector, one which has not gained traction even among the largest and most reputed manufacturing firms across the world. Does the profits from the production outweigh the transaction costs associated with manufacturing with leased assets? I am not sure. 

Consider this. The leasing firm has locked-in production supply commitments made to long-term clients, from which they would be loath to renege. In contrast, the asset owner's incentives are far less strongly aligned towards ensuring such rigorous reliability. He does pay a penalty for reneging on contractual terms, but it is unlikely to be anywhere commensurate with the loss suffered by the manufacturer. Further, in order to limit disputes, a tighter ring-fencing of ownership and operation may, perversely enough, by making the owner a lazy rent-seeker, increase the cost for the operator and make his production commercially less viable. Or, is this another Indian jugaad business innovation model?

Friday, June 5, 2015

20 Simple Ways To Relax And Unwind When Life Has Been Rough

Do you occasionally feel like a cartoon character with a finger in an electrical socket? Stress is such an integral part of our lives nowadays that we seldom realise it isn’t something we’d classify as normal. Not all stress is abnormal, though. There is such a thing as good stress, which keeps us going and motivates us to complete tasks on time. But bad stress or chronic stress is what you should be wary of. This is the kind of stress that can cause physical, mental, and emotional discomfort, and make you feel all kinds of wrong.
The time to relax is when you don’t have time for it. Now is the time to manage the good, the bad, and the ugly faces of stress. Here are a few ways to help you do just that.
1. Identify your stressors
We are often so lost in our self-acclaimed stressful lives, that we never really sit back and see what EXACTLY is stressing us out. Sure, everyone says that they have stress in their life…but has anyone ever listed down concrete things/situations that stress them out? Do exactly that. Sit down and ask yourself what exactly is making you so stressed; and you’ll often find the solution right here.: Identify your stressors© fitness-library Identify your stressors
Image credit: fitness-library
We are often so lost in our self-acclaimed stressful lives, that we never really sit back and see what EXACTLY is stressing us out. Sure, everyone says that they have stress in their life…but has anyone ever listed down concrete things/situations that stress them out? Do exactly that. Sit down and ask yourself what exactly is making you so stressed; and you’ll often find the solution right here.
2. Craft
Adopting a new hobby; something that gives you the chance to craft or create something is always pleasurable since it gives you the feeling of being productive. Also, repetitive motions - like the fine motor skills used to knit or make jewellery -- can soothe a stressful mind and help you calm down, since it makes you mindful of the present. Speaking of which….© familyholiday Craft
Image credit: familyholiday
Adopting a new hobby; something that gives you the chance to craft or create something is always pleasurable since it gives you the feeling of being productive. Also, repetitive motions - like the fine motor skills used to knit or make jewellery -- can soothe a stressful mind and help you calm down, since it makes you mindful of the present. Speaking of which….
3. Being Mindful
It cannot be stressed enough, the importance of being mindful. We’re always plugged in on two hundred devices at once, and are under so much pressure to reply to every tweet, email and ping that comes our way. When was the last time you actually tasted the food you ate? Are you aware of how many sips it takes you to finish a glass of water? If not, it’s because you are too busy being staring at a screen. Most of our jobs today involve that, anyway, so it’s best to avoid the screen when performing normal everyday tasks and instead be mindful of what you’re doing.© coe Being Mindful
Image credit: coe
It cannot be stressed enough, the importance of being mindful. We’re always plugged in on two hundred devices at once, and are under so much pressure to reply to every tweet, email and ping that comes our way. When was the last time you actually tasted the food you ate? Are you aware of how many sips it takes you to finish a glass of water? If not, it’s because you are too busy being staring at a screen. Most of our jobs today involve that, anyway, so it’s best to avoid the screen when performing normal everyday tasks and instead be mindful of what you’re doing.
4. Do Something Pleasurable
Anhedonia is something we know all too well. It’s when the things you used to enjoy now leave you cold, as if there is a barrier between what you enjoy doing; few things seem rewarding any more. You can counteract this feeling by taking baby steps towards the things you used to enjoy. Some ideas include(a) Be kind to your body: take a shower, lather on your favourite lotion and realise that you smell amazing, you feel clean. Drink lots of water, have lots of cold fruits and drink fresh juice.(b) Other activities that seem mundane: meet up with a friend you haven’t contacted in a while, maybe go out with them to grab lunch; bake a cake and share it with your neighbours or colleagues.Feel free to think up your own ideas; anything that makes you feel accomplished and pleased with yourself is a great way to begin..: Do Something Pleasurable© clearcalmspace Do Something Pleasurable
Image credit: clearcalmspace
Anhedonia is something we know all too well. It’s when the things you used to enjoy now leave you cold, as if there is a barrier between what you enjoy doing; few things seem rewarding any more. You can counteract this feeling by taking baby steps towards the things you used to enjoy. Some ideas include
(a) Be kind to your body: take a shower, lather on your favourite lotion and realise that you smell amazing, you feel clean. Drink lots of water, have lots of cold fruits and drink fresh juice.
(b) Other activities that seem mundane: meet up with a friend you haven’t contacted in a while, maybe go out with them to grab lunch; bake a cake and share it with your neighbours or colleagues.
Feel free to think up your own ideas; anything that makes you feel accomplished and pleased with yourself is a great way to begin..
5. Turn To Your Memories
This one has personally worked for me very well. When you feel overwhelmed by all the criteria you feel the need to fulfil, or the constant need to be perfect at every task you ever attempt, and if you fail, which you inevitably will, you will feel the stress of being a grown up, and the stress that comes with taking all the responsibilities that you have WILLINGLY taken up. What you should do then, is turn to all the memories that are your safe haven. A memorable trip you took with friends, or the time that you faked a sickness to get out of going to school and actually succeeded (we never did), or even the time you got praise for something you successfully completed. The present will seem less intimidating, and you’ll realise that it’s okay to be stuck sometimes. With that acceptance comes peace of mind.: Turn To Your Memories© thepetwiki Turn To Your Memories
Image credit: thepetwiki
This one has personally worked for me very well. When you feel overwhelmed by all the criteria you feel the need to fulfil, or the constant need to be perfect at every task you ever attempt, and if you fail, which you inevitably will, you will feel the stress of being a grown up, and the stress that comes with taking all the responsibilities that you have WILLINGLY taken up. What you should do then, is turn to all the memories that are your safe haven. A memorable trip you took with friends, or the time that you faked a sickness to get out of going to school and actually succeeded (we never did), or even the time you got praise for something you successfully completed. The present will seem less intimidating, and you’ll realise that it’s okay to be stuck sometimes. With that acceptance comes peace of mind.


6. Create a Relaxation Room

It doesn't have to be a "room" per se. It can be a space in your bedroom, or in a quaint coffee shop down the street, but the key is having an area solely devoted to relaxing. Where you can sit and actually take a breath without having a hundred and one things trying to get your attention. This should be your device-free zone, where all you can carry is probably a book or magazine or just your imagination. The idea is to give you a place to decompress with very little stimulus.: Create a Relaxation Room© timesofmalta Create a Relaxation Room
Image credit: timesofmalta
It doesn't have to be a "room" per se. It can be a space in your bedroom, or in a quaint coffee shop down the street, but the key is having an area solely devoted to relaxing. Where you can sit and actually take a breath without having a hundred and one things trying to get your attention. This should be your device-free zone, where all you can carry is probably a book or magazine or just your imagination. The idea is to give you a place to decompress with very little stimulus.
7. Buy A Plant
This is the pet-equivalent for those who’re always on the go and working non-stop. Having a plant is seemingly a very unimportant thing to do, but they’re more than just indoor air purifiers. The colour green has a positive effect on the brain and simply having a plant around will make you feel much more connected with nature. Also, mindfully done, the act of watering a plant can be very relaxing and rewarding.: Buy A Plant© decor10blog Buy A Plant
Image credit: decor10blog
This is the pet-equivalent for those who’re always on the go and working non-stop. Having a plant is seemingly a very unimportant thing to do, but they’re more than just indoor air purifiers. The colour green has a positive effect on the brain and simply having a plant around will make you feel much more connected with nature. Also, mindfully done, the act of watering a plant can be very relaxing and rewarding.
8. Be Grateful
Wanting to be your best is normal, especially in teenagers. However, we seldom ever stop and feel satisfied with who or where we are. Of course, feeling way too satisfied would mean we would stop working to be better; but the constant pressure to be better than we already are is ruining a lot of us. We’re never happy with the job we have or the marks we got. But there’s absolute joy that comes out of waking up early in the morning and being happy that you managed it. Be happy for once, even for a little while, because it will calm those fidgety nerves.: Be Grateful© fastcompany Be Grateful
Image credit: fastcompany
Wanting to be your best is normal, especially in teenagers. However, we seldom ever stop and feel satisfied with who or where we are. Of course, feeling way too satisfied would mean we would stop working to be better; but the constant pressure to be better than we already are is ruining a lot of us. We’re never happy with the job we have or the marks we got. But there’s absolute joy that comes out of waking up early in the morning and being happy that you managed it. Be happy for once, even for a little while, because it will calm those fidgety nerves.
9. Sleep Is Your Kryptonite
Sleep is magical, really. When all your emotions are going haywire, and you’re feeling all the negative emotions it’s possible for you to feel, sleep is the way to go. When you wake up after an hour or even five, you’ll feel better. And if you miss out on your work, or on life in general, tell yourself that your mental health is important. As we said before, sometimes, it’s okay not to be in control.: Sleep Is Your Kryptonite© newsday Sleep Is Your Kryptonite
Image credit: newsday
Sleep is magical, really. When all your emotions are going haywire, and you’re feeling all the negative emotions it’s possible for you to feel, sleep is the way to go. When you wake up after an hour or even five, you’ll feel better. And if you miss out on your work, or on life in general, tell yourself that your mental health is important. As we said before, sometimes, it’s okay not to be in control.
10. Change your clothes
As soon as you get home from a stressful day at work or school, change your clothes. You’re doing yourself a huge favour, because you’re telling yourself that you’re now out and AWAY from the stressful environment, and this will automatically calm your nerves. Don't be lazy about this; it takes practically no time!© cosmopolitan Change your clothes
Image credit: cosmopolitan
As soon as you get home from a stressful day at work or school, change your clothes. You’re doing yourself a huge favour, because you’re telling yourself that you’re now out and AWAY from the stressful environment, and this will automatically calm your nerves. Don't be lazy about this; it takes practically no time!
11. Go To A Bookstore
No, you don’t necessarily have to be a bookworm or even an avid reader to do that. The idea is to go somewhere public but private at the same time, and feel lost. And there’s something for everyone in a bookstore, so why not? Being surrounded by something other than electric devices is a strangely delightful feeling.: Go To A Bookstore© chimesinthelibrary Go To A Bookstore
Image credit: chimesinthelibrary
No, you don’t necessarily have to be a bookworm or even an avid reader to do that. The idea is to go somewhere public but private at the same time, and feel lost. And there’s something for everyone in a bookstore, so why not? Being surrounded by something other than electric devices is a strangely delightful feeling.
12. Indulge in Guilty Pleasures
Once in a while, it’s alright to do this. Watch 'The Notebook' three times in a row and cry your eyes out, watch 'Keeping Up With The Kardashians' and laugh at the things you wouldn’t get to experience very often. Guilty pleasures exist to make you feel guilty for indulging in them; but we’d choose guilt over debilitating stress any day!: Indulge in Guilty Pleasures© ladolcevitablog Indulge in Guilty Pleasures
Image credit: ladolcevitablog
Once in a while, it’s alright to do this. Watch 'The Notebook' three times in a row and cry your eyes out, watch 'Keeping Up With The Kardashians' and laugh at the things you wouldn’t get to experience very often. Guilty pleasures exist to make you feel guilty for indulging in them; but we’d choose guilt over debilitating stress any day!
13. Do Nothing
We all know what Winnie the Pooh said – don’t underestimate the value of doing nothing! Although this seems like an everyday thing, we’re always doing something, either physically or mentally. It’s important to know how beautiful it is to do nothing, and rest afterwards. Have an emergency exit for every day; you never know when it gets too much to handle.© babble Do Nothing
Image credit: babble
We all know what Winnie the Pooh said – don’t underestimate the value of doing nothing! Although this seems like an everyday thing, we’re always doing something, either physically or mentally. It’s important to know how beautiful it is to do nothing, and rest afterwards. Have an emergency exit for every day; you never know when it gets too much to handle.
14. Will This Matter When I’m Dead?
Admittedly, this sounds more than a bit morbid, but visiting a graveyard -- whether literally or figuratively -- can help you reframe a stressful situation. No, seriously. This is so important and its funny that, although it seems ridiculous, it actually works! There’s just a slight possibility of going overboard and literally becoming stress-free, but if that’s what you’re aiming for, then seriously, ask yourself this question. And give yourself the answer.: Will This Matter When I’m Dead?© talkingovercoffee Will This Matter When I’m Dead?
Image credit: talkingovercoffee
Admittedly, this sounds more than a bit morbid, but visiting a graveyard -- whether literally or figuratively -- can help you reframe a stressful situation. No, seriously. This is so important and its funny that, although it seems ridiculous, it actually works! There’s just a slight possibility of going overboard and literally becoming stress-free, but if that’s what you’re aiming for, then seriously, ask yourself this question. And give yourself the answer.
15. The Internet Is A Friend
We all know the important of plugging out of all forms of connectivity to feel better, but for those of us who have desk jobs, we can’t really afford to look away from our screens every 5 minutes. What’s the solution? A few of these websites that will turn your mood around! Calm Make everything okay Rainy Mood Nicest place on the internet Do Nothing NoisliThe quiet place SoundrownAutomatic FlatteryLook at something Disgruntle me: The Internet Is A Friend© houseofanubis The Internet Is A Friend
Image credit: houseofanubis
We all know the important of plugging out of all forms of connectivity to feel better, but for those of us who have desk jobs, we can’t really afford to look away from our screens every 5 minutes. What’s the solution? A few of these websites that will turn your mood around!
Calm Make everything okay
Rainy Mood
Nicest place on the internet
Do Nothing
Noisli
The quiet place
Soundrown
Automatic
Flattery
Look at
something
Disgruntle me
16. Meet Your Happy Person
Everyone should have this one person, their chill-pill, who can tell them to calm down and it just magically happens. People who light up after seeing you, or always have some comforting things to say are extremely important people who need to stay in your life, unlike the walking, talking black holes that suck the life out of you.: Meet Your Happy Person© nkayesel Meet Your Happy Person
Image credit: nkayesel
Everyone should have this one person, their chill-pill, who can tell them to calm down and it just magically happens. People who light up after seeing you, or always have some comforting things to say are extremely important people who need to stay in your life, unlike the walking, talking black holes that suck the life out of you.
17. Water
Try the Japanese Water Therapy (Drink 4 glasses of water immediately upon waking up in the morning); or you can be a bit more ridiculous and drink water upside down. That helps relieve stress and avoid hiccups. Swimming or any other water activity helps in lowering your stress levels. Being 70% water has its benefits, people.© Alex Deckard Water
Image credit: Alex Deckard
Try the Japanese Water Therapy (Drink 4 glasses of water immediately upon waking up in the morning); or you can be a bit more ridiculous and drink water upside down. That helps relieve stress and avoid hiccups. Swimming or any other water activity helps in lowering your stress levels. Being 70% water has its benefits, people.
18. Blow Up A Balloon
No one can be stressed and grumpy while blowing a balloon. Try it. There’s just something humorous about having a sack of air lying around. Consequently, you can just try to balance a balloon, and not let it touch the ground. Hey, it’s a game for kids, but you can put two and two together and realise why kids always have a smile plastered on their face.: Blow Up A Balloon© bakery-square Blow Up A Balloon
Image credit: bakery-square
No one can be stressed and grumpy while blowing a balloon. Try it. There’s just something humorous about having a sack of air lying around. Consequently, you can just try to balance a balloon, and not let it touch the ground. Hey, it’s a game for kids, but you can put two and two together and realise why kids always have a smile plastered on their face.
19. Distance Yourself From Triggers
Being self-absorbed in your own world is a fantastic way to stress yourself out over things which are plain irrelevant. Simply stop being around thoughts or places or even people who make you anxious. Mini-vacations or 5-minute vacays are extremely helpful for those who cannot take the time out to personally work on individual stressors.: Distance Yourself From Triggers© meangirlgifs Distance Yourself From Triggers
Image credit: meangirlgifs
Being self-absorbed in your own world is a fantastic way to stress yourself out over things which are plain irrelevant. Simply stop being around thoughts or places or even people who make you anxious. Mini-vacations or 5-minute vacays are extremely helpful for those who cannot take the time out to personally work on individual stressors.
20. Find What Works For You
Finally, don’t just take in the tips you read everywhere. Your body and mind are unique to you. What works for others isn’t guaranteed to work for you, but the road to self-discovery requires experimentation. These are all very relaxing but maybe your kind of de-stressing involves pushing walls and tiring yourself out physically. As long as it's healthy and it works, it's good enough for you. What do you do when you're having a tough time? Tell us some of your de-stressing tricks in the comments below.: Find What Works For You© picture-machine Find What Works For You
Image credit: picture-machine
Finally, don’t just take in the tips you read everywhere. Your body and mind are unique to you. What works for others isn’t guaranteed to work for you, but the road to self-discovery requires experimentation. These are all very relaxing but maybe your kind of de-stressing involves pushing walls and tiring yourself out physically. As long as it's healthy and it works, it's good enough for you.
What do you do when you're having a tough time? Tell us some of your de-stressing tricks in the comments below.