Face Value

I often wonder, what is that quality in mankind that differentiates one person to the other. We see numerous people in our day to day life and subconsciously assay the person. The parameters of this estimation is generally very complex and often beyond the scope of human comprehension.

But, the initial parameter of judgment is the appearance of the person, the looks or the more tangible quality of a human. And, we must agree to the fact that this remains to the most lasting impression of a person. But, we also realize that the real self of a person is not tangible and can only be felt or seen by an in depth interaction of that person. Again, the disadvantage of the intangible qualities is that it cannot be judged by the human mind at the first instance. So, this brings us back to the conclusion that the appearance is the most marketable factor of a human being.


This postulate is also suggested by a study that was carried recently in the USA. The study involved the pictures of the CEOs of the top 25 and bottom 25 companies of the Fortune 1000 list. Now, these pictures were given to people who did not know any one of them and were asked to identify which of them seemed more successful than the others. Surprisingly, 90% of the results matched the group to which each of the individuals belonged. It was also given that the subjects in consideration had no variation in terms of race, gender, etc. This study is definitely substantial to the debate in hand.

So, can we conclude that our success depends upon the fact that how are we perceived at the other end? The answer would be a probable 'yes'. This is also justified by the fact that we often have scenarios where we tag individuals on the basis of their appearance (The way one looks, speaks, carries one's self), generically called the personality of the person. We all must have done this at some point in our lives.

So, it might be sensible to say that what actually matters at the end of the day is the FACE VALUE!!

A very well said phrase: "Your Attitude defines your Altitude. Determine it yourself"

Decoupling Theory

Has the Indian Economy decoupled from that of the US? Will a probable economic recession in the US affect India?

We are quite distant from answering these questions certainly. A justified and informed answer would probably be yes as well as No.

Let’s investigate:

The Indian economy has decoupled from that of the US and will not be affected by the economic recession because:

1. The exports to the US are relatively less and constitute a mere 2% of the GDP. So, a decrease in overseas demand will not spell doom to the economy.
2. The Indian economy is mainly driven by domestic demand and the sound fundamentals of the economy will drive the domestic demand further up.
3. The economy has substantial scope of growth in many domestic sectors like Agriculture, which requires investment and is isolated from the global scenario.


Decoupling is a myth and the Indian economy is bound to be affected by a US recession because:

1. As the global trade becomes more and more integrated, the affect one country has on the other increases significantly. Hence, an open country cannot be isolated from a global recession.
2. As the US inches towards the recession, the FIIs try to go for safer investments and the selling in the financial markets increases causing a downturn of the financial market.
3. India’s growth rate for the year to March 2008 will be 8.7 per cent, down from 9.6per cent the previous year, according to the government’s statistics office, reflecting the dual impact of an appreciating rupee and sharp monetary tightening.

We might say that the Indian economy has not decoupled from that of the US, while the fear of such an economic slowdown in the US is much lesser than it used to be previously. This is primarily due to the self sufficience of the Indian Economy in the recent times. However, no global economy can remain isolated from a US slump as majority of the exports of growing economies remain to be the developed economies like the US.

The SubPrime Crisis

After the dot com bubble burst in the US and followed by the 9/11 strikes in the WTC, The Central banks around the world slashed the interest rates to create liquidity and avoid an acute economic slump. Due to the reduced interest rates, the investors went for investments with higher risk and greater returns. This in turn caused the lenders to mortgage the loans to customers with weak credit history and likely to default. This created a high demand among the consumers and the housing sector went to an all time high in 2005 before it finally collapsed in 2006.



As a result of these activities, the foreclosure activities increased, large lenders and hedge funds declared bankruptcy and soon their was a decline in the economic growth and the consumer spending.

Culprits of the crisis:-
1. Lenders
2. Home Buyers
3. Investment Banks (They worsened the situation)
4. Rating Agencies (A possible conflict of interest)
5. Investor Behavior
6. Hedge Funds