Thread by @gauravsabnis

At work dinner talk turned to covid travails.

Me: 90 yo bedridden gran, I used to fly every few mths to help parents. Thankfully sister, cousins, uncles, aunts the to help.

Chinese colleague: that's nice. Sister, cousin, aunt...are theoretical concepts for us.

Me: 😳😳😢

Colleague: I'm the one child of two parents who are also both one child. That's pretty much my generation. We know of sisters, uncles, aunts in theory. But for a billion of us, no personal experience. We each only have 2 parents, 4 grandparents.

Never thought of it like that!

We all know of the One Child policy but rarely do we think about what it means for life on a day to day basis or even generation to generation basis. No brothers, sisters, cousins, uncles, aunts. For a sixth of the world's population.

She was like, "cousin" is a particularly difficult concept for them to comprehend growing up, because it's already a third-order concept. When you have no experience of siblings, what possible meaningful concept can you have of the child of your parent's sibling?

This big emotional epiphany and a burst of empathy about the actual "human costs" of policies and politics reminded me of a similar one I had in Argentina.

A couple of years ago, I took an undergrad class to Buenos Aires for a study tour. Half of them finance students.

Before the trip, I had prepared a syllabus full of facts about Argentina (& Chile), ranging from extensive lectures, homework, visit to Moody's for presentations on country credit risk assessment, lectures on economics and history and the financial landscape and all.

Obviously, a BIG topic that kept coming up was Argentina's inflation rate, which has hovered around 40-50% for years. The money in your pocket loses 1% of its value every week, is how one speaker put it. Students learned, fascinated, about how it impacts doing business etc.

We discussed it a lot. At a university in BA with an Econ prof who told us how the govt once fixed Big Mac prices colluding with local franchisees to keep the utterly unscientific, but very popular in business press, "Big Mac Index" of inflation.

We visited a micro investing startup which shared with us the unique bookkeeping and money management challenges of running such a business in a place where the currency is dropping steadily, with no end in sight. How do you figure out interest rates in that context, etc.

And other such very formal, academic, business oriented presentations and discussions.

But the biggest learning on this for us all came from a casual small talk conversation at our last dinner in BA. Our local Trip Manager was with us. The ones who arrange all this on the ground

One of the students asked her about her family, house etc. You know, usual dinner table conversation. She told us she had recently bought a house. And the student, still fresh from all those presentations, asked, wait, how does mortgage work in a place with 50% inflation?

And then all other conversation stopped and we listened as she described what an ordeal it is to buy a house in Argentina. Mortgage, lol, she said. You have to be quite well off for a bank to give you that much money without ridiculous interest rates. It's all cash.

And by cash, not pesos. Nope. Pesos are no good to buy real estate. Those dealings are done in USD.
So she said how after she started working in the travel planning industry and got a steady income, whatever she saved at the end of the month, she'd buy USD. And stash it.

And everyone she knew, who had a steady income, did that. For a middle class person in Argentina, the only real way to save regularly, build a nest egg, is to hoard USD. Hoard it to a point where it's enough to buy a house.

Students were already like, whoa!

And then she described her actual house buying experience. Checking it out, choosing it, etc, similar process as anywhere. But the transaction itself? She bought a money vest ("almost everyone in Argentina has bought one at some point"), packed the money on her body that day,...

Went with her dad and some hired muscle, armed, to the broker's office. Had to take these precautions because the streets outside real estate deals are lucrative targets for someone wanting to rob someone of a lot of USD, which is like gold there. Hiring muscle to buy a house. 😳

The relief she felt when the deal went off smoothly. Now her pile of dollars stashed under the mattress was an actual house. But she is still doing that thing of converting any extra pesos to USD and stashing. Only way for the middle class to smartly save. Then buy a bigger house

We all learned about the human impact of this theoretical concept of inflation and I think we all learned more about it from hearing her experience than all those presentations.

This smart, confident, efficient, comparatively successful woman in her 30s was having to do all this

How must life be for those in the vulnerable sections of society? That conversation turned that 50% inflation from an academic curiosity into an actual human cost inflicting monstrosity. Just like yesterday with the One Child policy fallout epiphany.

No siblings or cousins 😳😳

And in Argentina, for the common citizen, USD is more valuable than gold. Cos gold prices still fluctuate, and eventually gold is only worth the cash it can get you. But USD always keeps going up up up in Argentina because of the inflation rate.

None of the economists and managers put the full scope in those succinct terms like our travel manager was able to by just sharing her life story.