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  • income inequality Archives - Unreal Blog
    About My First Book About My Second Book About Supporting Me Contact Advertising Professional PHP Services Tag Archives income inequality Quantitative Finance Most Likely Wealth Distribution January 25 2016 manoj In the last post I gave vent to all my left wing righteousness against the growing income disparity Then it occurred to me a totally uniform wealth distribution is stochastically unlikely In fact it is over seven billion times less likely than one person in the whole world holding all the wealth in the world That brings me to the topic of this post what is the most likely wealth distribution Continue reading income inequality wealth distribution Corporate Life Life and Death Quantitative Finance Income Inequality January 19 2016 manoj I read on BBC yesterday that the richest 62 people in the world now earn as much as the poorest half which would be about 3 5 billion people Although there is some confusion about the methodology it is clear that the wealth and income have been getting more and more polarized The rich are certainly getting richer Income inequality is more acute than ever Continue reading capitalism economy financial meltdown income inequality money Corporate Life Work and Life Disappearance of the Middle Class September 17 2014 manoj Most people who are likely to read this post think of their financial station as middle class so you might find it strange that I should say the middle class is disappearing But the polarization in the wealth distribution of the world is very real and it is visible at every strata of the society I would like to convince you by anecdotes and examples before getting logical and formal about it Continue reading income inequality middle class wealth distribution Advertisement Subscribe to Unreal Blog Email address Translations Most Popular Posts Blank

    Original URL path: http://www.thulasidas.com/tag/income-inequality/ (2016-02-16)
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  • wealth distribution Archives - Unreal Blog
    Second Book About Supporting Me Contact Advertising Professional PHP Services Tag Archives wealth distribution Quantitative Finance Most Likely Wealth Distribution January 25 2016 manoj In the last post I gave vent to all my left wing righteousness against the growing income disparity Then it occurred to me a totally uniform wealth distribution is stochastically unlikely In fact it is over seven billion times less likely than one person in the whole world holding all the wealth in the world That brings me to the topic of this post what is the most likely wealth distribution Continue reading income inequality wealth distribution Corporate Life Work and Life Disappearance of the Middle Class September 17 2014 manoj Most people who are likely to read this post think of their financial station as middle class so you might find it strange that I should say the middle class is disappearing But the polarization in the wealth distribution of the world is very real and it is visible at every strata of the society I would like to convince you by anecdotes and examples before getting logical and formal about it Continue reading income inequality middle class wealth distribution Advertisement Subscribe to Unreal Blog

    Original URL path: http://www.thulasidas.com/tag/wealth-distribution/ (2016-02-16)
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  • capitalism Archives - Unreal Blog
    only trickles through channels drawn by the corporate overlords These unfair trickles did not bother us the middle class for a long time because they were not all trickling away from us Now that they have started to we are beginning to sit up and protest I sympathize with my American client Now that the corporatists are after our little trickles we hate corporatism capitalism corporatism economy money power Corporate Life Philosophy Work and Life Was Yours Now Mine August 9 2012 manoj I feel I have lived through an era of great changes The pace of change can seem accelerated if you travel or emigrate because various geographical regions act as different slices in time I have had the benefit or the misfortune of multiple emigrations With that coupled with my advancing years I feel as though I have seen a lot Most of what I have seen fills me with a foreboding of gloom and doom Perhaps it is merely the pessimism characteristic of an unduly cynical mind or perhaps it is the true decay of our global ethical standards On the positive side the pace of change is indeed fast and furious This is the kind of change you like you know vinyl to spool tape to cassette to MP3 to iPod kind Or the land line to satellite to cell to Skype to Twitter kind However along with this positive and obvious track of changes there is an insidiously slow and troubling track creeping up on us It is n this context that I want to reuse the over used allegory of the frog in a pot If you put a frog in hot water it will jump out of the pot and save its skin But if you place the frog in cold water and slowly heat up the pot it won t feel the change and boil to death The slowness of change is deadly So let me be the frog with delusions of grandeur allow me to highlight the unhealthy changes accumulating around us You see along with the technological miracle that we are living through there is an economic or financial nightmare that is spreading its tentacles over all aspects of our social and political existence transfixing everything in place in its vice like grip Slowly Very slowly Because of this invisible hold on us with every iPod we buy we the middle class take a couple of dollars from the very poor and give it to the very rich We don t see it that way because some of us make a few cents in the process The Apple store franchisee makes a few cents the employee of the month gets a token raise an apple developer may enjoy a nice vacation or a senior executive might get a new jet the economy of the country goes up a notch NASDAQ and so everybody s pension goes up a tiny fraction all are happy right Well there is this little question

    Original URL path: http://www.thulasidas.com/tag/capitalism/ (2016-02-16)
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  • economy Archives - Unreal Blog
    in stark contrast with the collective community owned economic system with notions of robust social redistribution of wealth communism or socialism Although the latter does sound like a better and more moral ideal at least in principle it never did pan out that way Corporatism is not as well known as capitalism At least I didn t know that such a word existed But the moment I heard it I could guess what it meant It points to the end product of unbridled capitalism one with no government control or even moral hangups In my view it happens this way once you have private ownership some people get richer than the rest There is nothing wrong with that in fact it is a mathematical certainty But then money gives those lucky guys more power and access to ways in which they can make more money For instance they can influence the political system and through it the fiscal and taxation policies Also private ownerships can be pooled together to form economic organisms that can sustain themselves These organisms are of course corporate bodies They exert power through their collective wealth to an even greater extent than the good old capitalists A curious thing happens when capitalists simple rich folks that is get sidelined by corporations The money and power get separated in a strange way The board members and CEOs who control the corporate bodies end up wielding power instead of the owners They are entrusted with the task of guarding and growing the capital They find novel strategies to do this like taking advantage of tax loopholes and tax havens and engaging in unsavory business practices like mixing any damn white powder with baby food for instance As long as they succeed in their remit of growing the capital

    Original URL path: http://www.thulasidas.com/tag/economy/ (2016-02-16)
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  • financial meltdown Archives - Unreal Blog
    he doesn t get any bonus but he still has his basic salary till the time he is let go It is like a free call option implied in all high flying banking jobs Such free call options exist in all our time segmented views of life If you are a fraudulent Ponzi scheme billionaire all you have to do is to escape detection till you die The bane of capitalism is that fraud is a sin only when discovered and until then you enjoy a rich life This time element paves the way for another slippery slope towards fraud and corruption Again it is something like a call option with unlimited upside and a downside that is somehow floored both in duration and intensity There must be a happy equilibrium between these two slippery slopes one toward dysfunctional socialism and the other toward cannibalistic corruption It looks to me like the whole financial system was precariously perched on a meta stable equilibrium between these two It just slipped on to one of the slopes last year and we are all trying to rope it back on to the perching point In my romantic fancy I imagine a happier and more stable equilibrium existed thirty or forty years ago Was it in the opposing economic ideals of the cold war Or was it in the welfare state concepts of Europe where governments firmly controlled the commanding heights of their economies If so can we expect China or India or Latin America to bring about a much needed counterweight Sections Bonus Plans of Mice and Men Hard Work Talent and Intelligence Talent Retention Profit Sharing Slippery Slopes Columns Corporate Life financial meltdown quantitative finance wilmott Columns Corporate Life Quantitative Finance The Wilmott Magazine Profit Sharing May 16 2009 manoj Among all the arguments for hefty bonuses the most convincing is the one on profit generation and sharing Profit for the customers and stakeholders if generated by a particular executive should be shared with him What is wrong with that The last argument for bonus incentives we will look at is this one in terms of profit and therefore shareholder value generation Well shareholder value in the current financial turmoil has taken such a beating that no sane bank executive would present it as an argument What is left then is a rather narrow definition of profit Here it gets tricky The profits for most financial institutes were abysmal The argument from the AIG executive is that he and his team had nothing to do with the loss making activities and they should receive the promised bonus They distance themselves from the debacle and carve out their tiny niche that didn t contribute to it Such segmentation although it sounds like a logical stance is not quite right To see its fallacy let s try a time segmentation Let s say a trader did extremely well for a few months making huge profits and messed up during the rest of the year ending up with an overall loss Now suppose he argues Well I did well for January March and August Give me my 300 for those months Nobody is going to buy that argument I think what applies to time should also apply to space sorry business units or asset classes I mean If the firm performs poorly perhaps all bonuses should disappear As we will see in the last post of the series this argument for and against hefty incentives is a tricky one with some surprising implications Sections Bonus Plans of Mice and Men Hard Work Talent and Intelligence Talent Retention Profit Sharing Slippery Slopes Columns Corporate Life financial meltdown quantitative finance wilmott Columns Corporate Life Quantitative Finance The Wilmott Magazine Talent Retention May 14 2009 manoj Even after we discount hard work and inherent intelligence as the basis of generous compensation packages we are not quite done yet The next argument in favour of hefty bonuses presents incentives as a means of retaining the afore mentioned talent Looking at the state of affairs of the financial markets the general public may understandably quip What talent and wonder why anybody would want to retain it That implied criticism notwithstanding talent retention is a good argument As a friend of mine illustrated it with an example suppose you have a great restaurant thanks mainly to a superlative chef Everything is going honky dory Then out of the blue an idiot cook of yours burns down the whole establishment You of course sack the cook s rear end but would perhaps like to retain the chef on your payroll so that you have a chance of making it big again once the dust settles True you don t have a restaurant to run but you don t want your competitor to get his hands on your ace chef Good argument My friend further conceded that once you took public funding the equation changed You probably no longer had any say over payables because the money was not yours I think the equation changes for another reason as well When all the restaurants in town are pretty much burned down where is your precious chef going to go Perhaps it doesn t take huge bonuses to retain him now Sections Bonus Plans of Mice and Men Hard Work Talent and Intelligence Talent Retention Profit Sharing Slippery Slopes Columns Corporate Life financial meltdown quantitative finance wilmott Columns Corporate Life Environment Humor Quantitative Finance Science The Wilmott Magazine Work and Life Talent and Intelligence May 12 2009 manoj In the last post I argued that how hard we work has nothing much to do with how much reward we should reap After all there are taxi drivers who work longer and harder and even more unfortunate souls in the slums of India and other poor countries But I am threading on real thin ice when I compare however obliquely senior executives to cabbies and slum dogs They are the executives that is clearly a

    Original URL path: http://www.thulasidas.com/tag/financial-meltdown/ (2016-02-16)
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  • money Archives - Unreal Blog
    pretty much out of the booking system Still they manage trading desks and asset classes cost centers Any trading platform we design has to provide adequate hooks in the system to respond to their specific requirements as well Closely related to this view is the perspective of Human Resources who decide incentives based on performance measured in terms of the bottom lines at cost center or team levels computing Corporate Life money quantitative finance wilmott Books Corporate Life Quantitative Finance Middle Office September 9 2013 manoj The perspective employed by the Middle Office team is an interesting one Their work paradigm is that of queues running in a first in first out mode As shown in the picture below they think of trades as being part of validation and verification queues When a new trade is booked it gets pushed into the validation queue from one end The Middle Office staff attacks the queue from the other end accepting or rejecting each entry The ones deemed good get into a second verification queue The bad ones are returned to the trading desks for modifications in the trade entries or possible cancellations A similar paradigm is employed in dealing with market operations such as fixing rates generating cash flow etc Market operations have their own two stage queues Note that the whole flow is to be facilitated by the trading platform which should have the capability to render different views It presents a queue based view of the data to the middle office staff and a report based view to the Market Risk Management team for instance or a trade centric view to most of the other teams It is important to each team to have a basic grasp and healthy respect for the work paradigm of the other so that they can communicate efficiently with each other It is no good ignoring the trade perspectives of the rest of the bank After all such trade perspectives evolved naturally out of years and years of trial and error computing Corporate Life money quantitative finance wilmott Books Corporate Life Quantitative Finance Quant Developers September 3 2013 manoj Unlike quants quantitative developers are more product centric Their job is to take the pricing models the output of the quant effort and make them deployable and accessible to the traders sales teams and the middle and back offices Their primary unit of work is a product because when the product definition changes regardless of whether it uses a new or an existing pricing model they have to integrate it into the system Even if it is merely a product variant they have to implement all the infrastructure and take care of the approval processes for its downstream handling For this reason the work paradigm that makes most sense to a quantitative developer is product centric Compared to the quants the quantitative developers are closer to the day to day activities on Front Office and Middle Office They view the trades identified by unique IDs as instantiations of products Once booked they end up in the trading platform database as distinct objects with attributes defined in trade inputs In addition to trade input they use market data feeds to price a product in the form of a trade The trading platform comes with a pricing interface which combines trade information and market data It also runs in what they call batch mode regularly at a given time of the day to compute prices and sensitivities of all trades Since it is the trading platform that performs the batch job the quantitative developers may take care of the associated resources like the grid computing platforms market data feeds trade databases etc In this respect their product centric perspective may get diffused into a trade centric view computing Corporate Life money quantitative finance wilmott Books Corporate Life Quantitative Finance Quants August 28 2013 manoj If you are a quant you are a mathematician with an advanced degree in mathematics or physics Your work is based on both academic research and professional peer reviewed publications You take your inputs from them apply your own formidable intelligence to come up with a stochastic pricing model that you think will work exceptionally well for a class of products You will also need the details of the products Your output is of course a pricing model of your own or an implementation of a pricing model from the literature This is your primary work unit In order to make use of this pricing model it will have to be validated Then a set of products using the pricing model will be defined and submitted for approval Once approved with the help of trade inputs and market data each of the products can be priced and booked into the trading platform But such activities are outside the sphere of interest and influence of the quant To them how a product is instantiated into a trade is pretty irrelevant and trivial It is merely a question of specifying the trade and market inputs to the pricing model Even how various products are derived is mechanical and all the real work is done in the pricing model This perspective though accurate and functional for a quant is pretty far removed from the view of the rest of the bank which is why quants sometimes have the dubious reputation of being out of touch with the industry The point is not so much that they have to change their perspective but they should appreciate that there are other equally valid perspectives held by other business units they interact with and make an effort to know them computing Corporate Life money quantitative finance wilmott Books Corporate Life Quantitative Finance Trade Perspectives August 22 2013 manoj The last section of this post series is on trade perspectives In fact our earlier sections on the static structure of the bank and the temporal evolution of the trade have been in preparation to this last section In the next

    Original URL path: http://www.thulasidas.com/tag/money/ (2016-02-16)
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  • Do You Have a Soul? - Unreal Blog
    hopes are also swapped through some clever brain dump and uploading for instance which means your soul in my body has all my memories intentions opinions etc and none of yours Would you feel as though you are in a wrong body Probably not because you are operating with my memories beliefs and so on So you would believe that you are in the right body Thinking along this line we would find it normal to consider the totality of our beliefs intentions memory etc as the key to our personal identity Still skeptical about this argument If so consider another situation in which our brains are physically swapped Would you then feel as though you are in a wrong body I would think so because you brain contains all the information about who you are and what your body should be Logically there shouldn t be any difference between swapping the brains physically or uploading and rewiring the brain Even when we logically accept the argument about the key to personal identity being all the software in the brain we still do not quite buy it And I know why Secretly we all believe that there is an internal locus of personal identity and an external one For instance even after uploading your brain contents into mine if you prick my finger the finger of my original body to be very precise the entity that would feel the pain would be me not you or so you might think It is this feeler this entity that I call the internal locus of personality and most people call the soul This notion of an internal locus a feeler or a soul is false however hard it is to come to terms with it If you read Zen and the Art of Motorcycle Maintenance and ponder over the personality that was annihilated by electroshock therapy you will have to accept that it is the state of the brain the software running on it that determines the personality If you still hold on to the soul being the key to personal identity you would have to come up with a convoluted story where one soul that of Phaedrus was tucked away somewhere since souls don t die another one that of Richard Pirsig was instilled for a while and later on both of them were in the same body So it looks to me that the totality of our thoughts memories beliefs goals hopes etc is the key to our personal identity The totally of course goes by the name of consciousness Even though it gives us the illusion of selfhood and an illusion of an internal locus of personal identity that part is merely incidental epiphenomenal What I did through the thought experiments above is to push the agenda of physicalism I kind of proved that the key to personal identity is in fact the three pounds of grey matter that we carry around in our head and the neuronal connections

    Original URL path: http://www.thulasidas.com/do-you-have-a-soul/ (2016-02-16)
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  • Primal Soul - Unreal Blog
    what I can feel and accept emotionally I don t like to drag in the concept of emotion here I am thinking of what I can accept at a gut level Primally would perhaps be a better word to use but I am not sure Any way once we have conscious awareness and develop a sense of temporal continuity about things and experiences around us we cannot help assigning continuity to the backdrop of it all our consciousness Continuity of selfhood is encoded into our mind Primally yes that would be the right word Logic and rationality which come after the primal plumbing of the mind consciousness selfhood etc which may all ultimately mean the same thing is already in place can influence our thinking only to a limited extent Mind grasps at anything that offers a semblance of eternal continuity Enter religions All conventional religions have some notion of a soul which comes in different forms and with a multitude of meanings and contexts although logically it can only mean our consciousness or an entity holding our consciousness and pretty much nothing else Thanks to our primal need to search and find continuity we readily buy into whatever notion of soul our parents religion happens to uphold ignoring the gaping holes in logic associated with it From the perspective of religions speaking of religions as organizational entities with intentions and purposes the notion of continuity implied in the concept of a soul has a great benefit it completely alters the risk reward analysis at the root of morality And it takes out death or at least greatly diminishes its significance in the analysis For death is only the beginning as the horror comedy taught us If the wages of sin are eternal third degree burns not some material comfort followed by thirty to life in a federal facility till death sets you free you do think twice before doing the crime The time that you may have to do could well be an eternity Other religions offer other kinds of divine carrots and sticks For instance if you are a Hindu engaged in a particularly unsavory Karma you will reincarnate as somebody or something on the receiving end of the stick roughly neutralizing your risk reward equation On the other hand if you are willing to take it on your chin with some amount of fortitude you will be upgraded to business class in your next life In all notions of spiritual continuity of consciousness and or soul there is something I find logically wanting It is the lack of continuity of memory Death is still a point of phase transition where all the existing memory is erased If we think of soul as the eternal manifestation of mind and consciousness erasing its memory is as good or as bad as killing it is it not What I find interesting in this Hindu notion is that the ultimate reward for presumably the best possible Karma is not an eternal

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