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Sridhar Vembu

@svembu

11 Oct

1/ Yesterday our high school age students, our teachers and I agreed on a concrete goal: students should be able to write a short essay in Tamil without error by Jan 1 2021.

"பிழையில்லாமல் தமிழில் எழுதுவோம்" as the goal reads in Tamil.

I have a deeper reason for this goal.

2/ Tamil is an ancient language where Spoken Tamil (ST) has diverged substantially from written formal Literary Tamil (LT) and in effect every Tamil student learns two languages side by side. LT is very strict.

This is known as Diglossia among linguists.
en.m.wikipedia.org/wiki/Diglossia

3/ Literary Tamil (LT) has a strict grammar (probably the strictest among Indian languages apart from Sanskrit ) and is unforgiving about error.

Guess what? Computer programming languages also have strict grammar and are unforgiving about error.

As I explained to the kids ..

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Sridhar Vembu

@svembu

9 Oct

1/ There is a Tamil sign we used to see in shops: கடன் உறவைக் கெடுக்கும் (debt destroys relationships). It means "Please pay for your goods, don't ask us to postpone your payment".

That quaint sign of course is against modern practice where we are encouraged to charge it up!

2/ The entire global trading system, in fact much of the global economy, now runs on the "charge it up" principle.

Countries are encouraged to become "prosperous" by promoting consumption without local production.

It does feel prosperous because we got all these goods.

3/ Here is the problem: global free trade is fundamentally incompatible with ever-expanding global debt (as measured by global debt to GDP ratio).

The old Tamil saw is right after all - debt does destroy relationships, and that's true in the village and true across nations.

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Sridhar Vembu

@svembu

9 Oct

1/ Silicon valley used to have slogans like "we code for food" and "ramen profitability" - all before the Fed bubble era when billion dollar Series QE funding rounds became common.

It may surprise people that Google only raised ~$25 million VC in total and that was common then.

2/ That old silicon valley experience is very relevant today for rural and small town India.

We have to roll up our sleeves and invent our way out of poverty and achieve "idli profitability" quickly.

That's the path to rapid capital development and durable prosperity.

3/ The raw material is our youth that longs for an opportunity, the vast latent talent pool of India. The key initial investment is skill development, in a setting of real world projects as opposed to conventional college education.

That is the idea behind "we code for food".

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Sridhar Vembu

@svembu

8 Oct

1/ I recently visited a textile spinning mill, one that converts raw cotton to yarn. The yarn goes to weaving mills which weave the yarn to fabric. The fabric eventually becomes clothing - that last part is where most textile jobs are, with the earlier parts highly automated.

2/ The spinning mills and the weaving mills have highly sophisticated machinery, most of which are made in Germany, Switzerland and Japan. These countries have had a long tradition of engineering focus and excellence.

India has a lot to learn and catch up in this area.

3/ We need to revive our tool making culture and build a strong machine building focus in India.

The economic impact of tool making and machine building is enormous. I will discuss that now.

Under socialist dogma, India assumed "we only need labour intensive industry". Wrong!

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Sridhar Vembu

@svembu

30 Sep

1/ When we attempt to do anything new - and often when we repeat something we have done before! - it is inevitable that we will make mistakes. I have made plenty in life and I continue to make them.

So many that I came up with "how to make mistakes" and I will infict that now!

2/ First, try to make small mistakes and learn bigger lessons from them. That way you make the mistake pay for itself.

What is a small mistake? Anyone that doesn't kill you or permanently haunt you is a small mistake. Now it is obvious why I like small mistakes.

3/ Second, try not to make the same mistake twice. That's not as easy as it sounds because to be sure we don't make the same mistake twice, we need to accept that we made a mistake in the first place.

For most of us, even accepting that we made a mistake to _ourselves_ is hard.

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Sridhar Vembu

@svembu

26 Sep

1/ Concentration of activity in industry and agriculture (even coffee shops!) is justified by economic theory on the grounds of economies of scale.

That's the idea that the per unit cost of a product drops with rising scale of production. It is true to a point but oversold.

2/ Per unit cost of production does drop with rising scale but here are a few key caveats.

The costs drop rapidly with scale at first but beyond a certain scale (let's call it "optimal scale"), stop dropping or even start increasing as dis-economies of scale kick in.

3/ The second point is crucial: the optimal scale, the scale at which unit costs stop dropping, itself is decreasing with technology advances. This is true for many industries.

Translated into plain language, it means that smaller scale production is viable in many sectors.

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