The idea of lending money to non worthy people at higher interest rates sounds good. Making bonds out of these loans and selling them sounds like a real clever trick .Something that an MBA lad can be promoted to many ranks higher to :)…..And thats sub prime for you , and its collapsing .The magnitude of this problem , wel as of now a trillion doller .And the effect …well it remains to be seen how far and deeply it hurts us .
But its not the damage that worries me .In fact some some people say that there might not be , after all , a great recession in USA and sub prime would be just like a bump across a long road. And that scares me even more .There is after all a limit to how far people can go with a shit [sorry but no better word to express…] . And to say that it will be managed somehow is even dangerous .
One need not be a financial wizard to find this out. The system has messed up with a trillion $ and some one has to pay for this.And thats as simple as that .
Unfortunately this simple fact seem to have been forgotten .By whom ? 🙂 , well thats little tough to word .
If you meet an MBA graduated out of a business school its interesting to note how they contrast one idea with other …say efficiency versus effectiveness .The points that are made in such analysis are fine and sometimes subtle and the conclusion quite revealing.One can also see how cleverly data is put together to form patterns , predict things and plan things.A life where things live in balance sheets …between quarters .;the list of such wizardly mental feats is long and these are quite important to people in corporate world .It seems like they have found out the secret of how tings works in this worlds , like we can control future .
While i am not really into either confirming or denying this ,the fact remains that something somewhere is going wrong .
At a level they did confuse ends and means.At some point in the quest to manage and survive in competition it happened .The fallacy can be elaborated to death .But bashing some people for their mistakes isn’t .. progress anyway .
Its defeat of the masses that need to be blamed .
The western or more correctly the school of philosophy and logic from the pioneer of industrialized set of people has been ruling the world .The ideas and concepts that were proposed sounded revolutionary and they seem to have worked .And worked a lot. From globalisation to GDPs to massic currency exchagre rate the language that people thing in , the point of views that define good vs bad …everything was impacted .A new world order of right and better was set.And it set so strongly that it overwhelmed and overtook many of the longest surviving civilization .At times this also rendered thier ideas as outdated and obsolete . Today when we look at the wisdom in financial and coporate world its hard to appreciate diversity.And thats where the point lies .
Everyone everywhere began to do the same thing , so much so , that people stopped questioning .Nobody wondered how could consuming the finite resources can really result in progress of man kind .How could a company rellay exist if all you have is many instituations owning it without , always any passion apart from profit driving it .Or say what heppen to identity on the day we reach the destination of globalisation .And lastly how the hell can U make prosper from lending to ppl not worthy of it .
Its not that the mindset where such hard questioning can come from does not exist .But they all wherever they exist are overwhelmed .It can also be termed as death of local sense against the global norms of carrying out business .
And surpisingly this local sense is where lies the hope .
This is not to say that the harwards and yales are done with all they could nourish and give to world.But all these while they are all that was there as origin of new thought.Time has come for other soils to get into a kind of intellectual churning ,come up with their own thought on carrying worlds business and the synthesis that would result might just bring us to the best set of ideals for a sensible and meaning full of conducting affairs .
….would the likes of IIM please stand and be counted ?