Banking Stocks

Banking stocks in India have been taking a drubbing since yesterday,and are expected to do so for some more time.The main reason seems to be the indication by the RBI Governor that the days of an easy monetary policy are numbered, and there is likely to be  a tightening of the same in the next review that is to happen in January.Another reason is  the higher provision for loan losses that the banks are supposed to make now.A tight monetary policy will be an imperative in order to control the inflation which is hurting the poor.The interest rates will rise due to lesser liquidity and increased cost of funds for the banks,and the credit which is the lifeline of the economy will slow down.As of now the rates of Cash reserve ratio, Repo rate and reverse repo rate have been left untouched, unlike the government in Israel and Australia.The knee jerk reaction on account of raising of the Stauatory Liquidity ratio from 24 to 25% was unwarranted as the banks are already maintaining this ratio at 27% which is more than that required by the statute.Sentiment in case of the banking stocks has been affected,and may be rightly so.

Advise: Buy on dips for margin trading,but exercise caution while investing  

Pain at IIM

When I was at National Defence Academy , I used to experience the following kind pf pains:

• Pain in the legs due to too much of running uphill
• Pain in the back because of front rolling,and carrying load.
• Pain in the head because of Maharaja position( ragging by seniors)
• Pain in the forearms because of rope climbing
• Pain in the stomach muscles because of upper circle on the beam

Here in the IIM , the pains are of a different type, and some of them are really of  a rare kind. Pain in the neck and eyes because of working long hours on the computer is understandable, but what I had never experienced earlier, and hopefully will never experience again is the pain in the fingers and the thumb because of writing exams for as much as nine hours on a single day!.......God help me to keep myself physically strong,mentally alert and morally straight...goes the NDA prayer

Adam's equity theory

If we feel that inputs are fairly rewarded by outputs (the fairness benchmark being subjectively perceived from market norms and other comparable references like peers) then generally we are happier in our work and more motivated to continue putting in at the same level.If we feel that our ratio of inputs to outputs is less beneficial than the ratio enjoyed by referent others, then we become demotivated in relation to our job and employer.People respond to a feeling of inequity in different ways.

• Generally the extent of demotivation is proportional to the perceived disparity with other people or inequity, but for some people just the smallest indication of negative disparity between their situation and other people's is enough to cause massive disappointment and a feeling of considerable injustice, resulting in demotivation, or worse, open hostility.
• Some people reduce effort and application and become inwardly disgruntled, or outwardly difficult, recalcitrant or even disruptive. Other people seek to improve the outputs by making claims or demands for more reward, or seeking an alternative job.

Understanding Equity Theory - and especially its pivotal comparative aspect - helps managers and policy-makers to appreciate that while improving one person's terms and conditions can resolve that individual's demands (for a while), if the change is perceived by other people to upset the Equity of their own situations then the solution can easily generate far more problems than it attempted to fix.Equity Theory reminds us that people see themselves and crucially the way they are treated in terms of their surrounding environment, team, system, etc - not in isolation - and so they must be managed and treated accordingly.

A marvel from Mehdi Hasan

AB KE HUM BICHRAY TO SHAYAD KABHI KHWABON MEIN MILEIN
JIS TARHAN SOOKHAY HUAY PHOOL KITABON MEIN MILEIN
AB KE HUM BICHRAY TO SHAYAD...
DHOND UJRAY HUAY LOGON MEIN WAFA KE MOTI
YE KHAZANAY TUJE MUMKIN HAI KHARABON MEIN MILEIN
AB KE HUM BICHRAY..
TU KHUDA HAI NA MERA ISHQ FARSHTON JAISA
DONON INSAAN HAIN TO KION ITNA HIJAABON MEIN MILEIN
JIS TARAN SOOKHAY HUAY PHOOL KITABON MEIN MILEIN
AB KE HUM BICHREIN TO SHAYAD...
GHUM E DUNYA BHI GHUM E YAR MEIN SHAMIL KAR LO
NASHA BARHTA HAI SHARABI JO SHARABON MEIN MILEIN
AB NA WO MEIN HON NA TU HAI NA WO MAZI HAI FARAZ
JAISAY DO SAAAY TAMANNA KE SARABON MEIN MILAEIN
JIS TARAN SOOKHAY HUAY PHOOL KITABON MEIN MILEIN
AB KE HUM BICHRAY TO SHAYAD........

Reflections

Life is a great gift that has been given to us by the almighty. Duuring our lifetime, we make a lot of friends, develop a lot of relationships, and are emotionally involved with our parents, brother, sisters,children, and even mere acquaintances. Each person leaves an impression on us,and we do the same on him. More often than not, we are so involved with our busy life,or just living in the moment, that we do not reflect on anything at all. I happened to see a song on youtube today that is affecting me  in a weird way.  I get a feeling that we should always be good to whosoever we come in contact with, because you never know when that person will no longer be around, for you to say goodbye.http://www.youtube.com/watch?v=1wtztH8op0w&feature=related 

High performance work system

A high performance work system is an integrated set of human resource management policies and practices that together produce superior employee performance.In fact, a growing body of evidence shows that the best performing companies in a wide range of industries perform so well in part because of their high performance work systems. While there’s no hard and fast rule about what comprises high performance work systems, most organizational psychologists would agree they include these practices:

1) Employment security

2) Selective hiring

3) Extensive training

4) Self managed teams and decentralized decision making

5) Reduced status distinctions between managers and workers

6) Information sharing

7) Contingent (pay-for–performance) rewards

 Transformational leadership (for instance, in terms of inspirational motivation).

9) Measurement of management practices

10) Emphasis on high quality work.

Productivity

Source : Asian Development Bank


What could be the possible reason for the low productivity levels of this country? Is it to do with our work culture, or is it to do with the rather low level of accountability that our superiors demand from us? I guess it is a combination of both the factors.In the context of the public sector, the horse does not get adequately rewarded , while the donkey does not get punished.

customer service

Cultural Dimensions

The following dimensions of culture given by Hofstede are useful while dealing with people of other countries, or taking decisions that have cross cultural connotations. I have taken them from the net and reproduced here verbatum

Power Distance Index (PDI) It is the extent to which the less powerful members of organizations and institutions (like the family) accept and expect that power is distributed unequally. This represents inequality (more versus less), but defined from below, not from above. It suggests that a society's level of inequality is endorsed by the followers as much as by the leaders. Power and inequality, of course, are extremely fundamental facts of any society and anybody with some international experience will be aware that 'all societies are unequal, but some are more unequal than others'.This is high in our country,as compared to the west

Individualism (IDV) This on the one side versus its opposite, collectivism, that is the degree to which individuals are inte-grated into groups. On the individualist side we find societies in which the ties between individuals are loose: everyone is expected to look after him/herself and his/her immediate family. On the collectivist side, we find societies in which people from birth onwards are integrated into strong, cohesive in-groups, often extended families (with uncles, aunts and grandparents) which continue protecting them in exchange for unquestioning loyalty. The word 'collectivism' in this sense has no political meaning: it refers to the group, not to the state. Again, the issue addressed by this dimension is an extremely fundamental one, regarding all societies in the world.

Masculinity (MAS) This versus its opposite, femininity, refers to the distribution of roles between the genders which is another fundamental issue for any society to which a range of solutions are found. The IBM studies revealed that (a) women's values differ less among societies than men's values; (b) men's values from one country to another contain a dimension from very assertive and competitive and maximally different from women's values on the one side, to modest and caring and similar to women's values on the other. The assertive pole has been called 'masculine' and the modest, caring pole 'feminine'. The women in feminine countries have the same modest, caring values as the men; in the masculine countries they are somewhat assertive and competitive, but not as much as the men, so that these countries show a gap between men's values and women's values.

Uncertainty Avoidance Index (UAI) It deals with a society's tolerance for uncertainty and ambiguity; it ultimately refers to man's search for Truth. It indicates to what extent a culture programs its members to feel either uncomfortable or comfortable in unstructured situations. Unstructured situations are novel, unknown, surprising, different from usual. Uncertainty avoiding cultures try to minimize the possibility of such situations by strict laws and rules, safety and security measures, and on the philosophical and religious level by a belief in absolute Truth; 'there can only be one Truth and we have it'. People in uncertainty avoiding countries are also more emotional, and motivated by inner nervous energy. The opposite type, uncertainty accepting cultures, are more tolerant of opinions different from what they are used to; they try to have as few rules as possible, and on the philosophical and religious level they are relativist and allow many currents to flow side by side. People within these cultures are more phlegmatic and contemplative, and not expected by their environment to express emotions.

Long-Term Orientation (LTO) versus short-term orientation: this fifth dimension was found in a study among students in 23 countries around the world, using a questionnaire designed by Chinese scholars It can be said to deal with Virtue regardless of Truth. Values associated with Long Term Orientation are thrift and perseverance; values associated with Short Term Orientation are respect for tradition, fulfilling social obligations, and protecting one's 'face'. Both the positively and the negatively rated values of this dimension are found in the teachings of Confucius, the most influential Chinese philosopher who lived around 500 B.C.; however, the dimension also applies to countries without a Confucian heritage.