Skip to main content

Lessons from the meltdown

Vineet NayarA few days ago i posted an article by my future boss Vineet Nayar { CEO - HCL Technologies Ltd} where he showed the silver lining of this recession phase and now when every country is working on the bailout packages and there's a bit of stability in the economy here's another great post by him about the Lessons from the meltdown >

· Courage to walk away: The very first learning that emerged from what is now being termed as a financial Armageddon was the need for courage: The courage to carve your own path and walk away from the herd. We in India were born with this lesson as we gained independence with ‘non-violence’ in an era of World Wars. In the US financial world, we saw Warren Buffet display the courage to walk away. Back in 2002, when companies began toying with exotic derivative instruments, Warren Buffet termed derivatives ‘financial weapons of mass destruction.’ Few listened to him then but today he stands out as the voice of sanity.

· Save it for a rainy day: The second lesson is the forgotten power of savings. The ‘savings mentality’ has always been a hallmark of the Asian culture. India, for one, has always had a high rate of savings – a phenomenon that is getting eroded with a new culture of consumerism sweeping across our cities today. Interestingly, America, which is home to 5% of the world’s population, accounted for 30% of global production and 37% of global consumption during boom times! On an individual level in the recent crisis, the ninja loans reflect this mentality, but collectively it made the entire country vulnerable to risk. And there were those who saw the warning signals.

In 2005, when the times were good, economists Paul Volcker and Clyde Prestowitz, pointed out that America was vulnerable due to all the leveraging, and predicted that a financial crisis could soon hit its shores. This has come true and – be it at a macro level or a micro level - it highlights a forgotten lesson on the power of savings and that that we should leverage only to the extent we can afford to service our debt. Its time for a “back to basics” approach, old fashioned as it may seen. Save and plough back in good times, and not fritter liquid assets away.

More...

Comments

Popular posts from this blog

JUIT V/S JIITU - Thank God I am a JUITian...

I thought I'll write about this topic after JIIT opens up for next semester but i guess i have seen all the shades of JIIT already so i can very well show you the difference between the two institutes... Although both of them are backed by the same great Jaypee group but only JUIT represents the true greatness of this group... Beautiful surroundings, awesome building,great learning atmosphere and above all great people...  Some of JUITians will disagree with me on several points but guys trust me no one knows JUIT better than me and come and spend a month here in JIIT you yourself will feel the difference...  I completed my graduation from Jaypee university of information technology waknaghat,solan {H.P}, A place which has given me so many great memories,some awesome friends, i met with some really nice and loving people... Even the faculty in JUIT is quite caring...  Its because of  HCL's Japanese language training that brought me to JIIT a sister institute of JUIT located in

Time to say goodbye, but to whom???

It’s been more than 4 years that I have spent in this place called JUIT… A place I was sure I wanted to get in when I saw the prospectus and luckily I got admission here… Life was full of ups and downs rather more down’s but at the end of it all I have a job in my hand which is enough for me to ignore those bad times… There a few things I have always been proud of like my association with almost all the clubs and activities especially technical and hospitality… besides the fact that except for my academics I was good at making things happen and that majorly because of my domain, everyone yes everyone in JUIT knows me… But now when its time to say goodbye to this great university, things are no more the same and not even the feeling… 4-5 months back when it was time for 2008 regular batch to leave it was altogether a different feeling even that time I felt as if I am also about to go but this time when we have just 20 more days here I am not getting that feeling. We got our farewell, sc

Lovely Si Madam...

Disclaimer : A song that was famous in a lot of Engineering coll's in the days when my uncle did his Engineering!! Just like we enjoy " Koi deewana kehta hai koi pagal samjhta hai " *I have tried to reproduce the entire song to the best of my memory, the original song might have a few minor changes!! Lovely si madam decent dhoondenge.. Not temporary permanent dhoondenge.... Lovely si madam, Aha ha ha…Hmm Hmm Hmmmm… Chahe bengal ki ho, chahe gujrat ki ho, Shimla ki ho ya pyaare, woh nanital ki ho Hum aisi, ho ho ho, hum aisi, hmm hmm, hum aisi beauty queen dhoondenge. Not temporary, permanent dhoondenge Lovely si madam, Aha ha ha…Hmm Hmm Hmmmm… Achhi si Height ho, color bhi white ho, Rashan ka yug hai pyaare kum se kum diet ho, Rashan ka yug hai pyaare kum se kum diet ho.. Hum aisi, ho ho ho, hum aisi, hmm hmm, hum aisi Sweet Sixteen dhoondenge. Not temporary, permanent dhoondenge Lovely si madam, Aha ha ha…Hmm Hmm Hmmmm… Evergreen ho, Beauty queen ho, Age bhi uski pyare,