Dec 17, 2016

Travelogue - Osaka

"Okini", said the clerk who issued us the tickets & subway card at Kansai airport. I had to google what it meant afterwards. It means 'Thank You' in Osakan dialect , but not so commonly used by the young generation apparently.. They prefer 'Arigatou'  ( Thank You ) and 'Domo Arigatou' ( Thanks a lot ) . Little did we know that we were set to hear these phrases an innumerable number of times  accompanied by bowing as a mark of respect..   That's Japanese society for you. Extremely polite, welcoming & helpful. Couple of days later, a gentleman who was rushing to his office, went extra-mile to help us locate a hotel that we were looking for. He even accompanied us right to the entrance of the hotel.

Okini was perhaps an early indicator for us towards another thing as well. Japanese society is rapidly aging. Due to strong work ethic , career focus & extra-mile loyalty towards the companies that they work for, lesser number of marriages happen and less number of couples have kids. It was conspicuous everywhere. There were very few babies / toddlers everywhere. Ourselves  touring with a three year old kid hence received smiles & attention at many places.

Look whom I found in Japan - Dori & Nemo
Osaka has got a really large aquarium ( called Kaiyukan ) . Being an ancient trading port, marine life & eco system is seeped into Osakan culture. Kaiyukan is a large & well maintained place. Perhaps one of the best I've seen so far. Well documented with elaborate explanations on different parts of marine life.

Japanese Meal - Part of 'Kaiseki' ( An elaborate set of meal )
 We had apprehensions about how would the Japanese food would be. Having tried Sushi once before, I wasn't really a big fan of that.. But have to say that if you are a Non-Vegetarian & likes spicy food, you would find the Japanese food to be quite OK.  They have rice along with all meals. And they have a 'curry' - which is quite similar to the Indian curries, but made out of beef / pork / chicken etc. They have a high proportion of leaf based dishes & less of fruits.  Some researchers say that this kind of healthy meal with the Domo Arigatou bow & lots of walking keep them healthy & fit..  Indeed, even if you a city dweller, transferring from one subway line to another in a major station could involve walking of about a Kilometer .
Artificial Penguin Habitat in Kaiyukan

To feel the pulse of Osaka, you need to take a walk into their shopping streets - Dotonbari & Shinsaibashi - Suji .. You get a feel of Chinatown in various south east asian cities, but more pricey & of remarkable quality.

Yen is a high denomination-based currency. Yet, prices tend to be quoted upto the lowest unit. i.e, it is not uncommon to hear prices like 3281 yen for a T-shirt.  Being from India, prices to be quoted like that is uncommon.. It could be like 3200 rupee or 3300 rupee , but very rarely any random number between 100's.  Perhaps this has got something to do with the deflationary spiral that Japan had gone through. People tend to value even a single yen.  And money is treated with a lot of respect. If you are paying at a shop or hotel, you are expected to place the cash / card into a tray & then the cashier takes it.

Osaka has Universal Studio as well. Though did not cover that.  We used Osaka as a base to cover Hiroshima , Kyoto & Nara . I hope to return here some day to see the Osaka castle area during Cherry Blossom . There is an interesting architectural structure in Nishi Umeda, Osaka - Two skyscrapers connected by an escalator at the top. Constructing this  kind of a building in a seismically active country requires some serious skill.

Osaka ( or in general, Japan  ) is a unique experience for people coming from west. First Asian country to industrialize. Comparable to US & Europe in technology & engineering. Amazing trains & public transport systems. A unique cultural experience with many nuances, Japan has much to offer to a traveler.

Other interesting aspects about Japanese society that I came across in this trip either as part of observation or conversation.
A) Why Japanese tend to wear surgical masks ? Another perspective
B)  Why yen is a safe haven ?
C ) Why Japan lost its electronics crown ?

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Dec 9, 2016

Travelogue - Hiroshima

"Till she was about 10 years old, she grew up like just another girl. She was strong & was a  member of athletic team in her school. In 1954, she developed swellings in her neck , ears and upon being admitted to hospital, was diagnosed with Leukemia and was given maximum of one year to live..  It was in hospital that she learned about the legend of folding a thousand origami cranes to have a wish fulfilled.. She completed 1000, but her wish to live further was not fulfilled. She died in 1955, when she was 12"  --  Remarked our guide Nobu (a native of Hiroshima) in an emotional, yet composed tone,  as she detailed the poignant story of Sadako Sasaki, a survivor of Atom bomb who went on to die later due to the effects of radiation she suffered when she was barely two years old

Sadako's Origami Cranes

Hiroshima Atom bomb dome seen through
the peace memorial & flame

Immortalized by a monument dedicated to her next to the Hiroshima memorial peace park and decorated with Origami cranes, this is a place that can tell you in the most impactful way, the effects of nuclear weapons on humanity.   Her story is detailed in a famous book as well

An illustration depicting the immediate state of survivors 

The infamous 'human shadow'. A person standing near a building during bombing apparently melted away leaving a shadow of his body on the building which was otherwise whitened due to bombing

Atom Bomb Dome, Ground Zero, Hiroshima
The most famous landmark is the Atomic bomb dome, a building that miraculously survived the bombings.  The peace museum is perhaps at the heart of the pacifist doctrine that has been a part of Japanese Politics after the war.  It details various tales of survivors, people who perished and the tale of destruction & radiation effects that has impacted the city ever since.

I asked Nobu, 'Whats taught in Japanese schools about Japan's role in war' . She told it is taught not in a straightforward way. Japanese attacks are portrayed as attacks on military installations, while the US bombings were taught as attack on civilians.. She also told that in this age of internet, it has become easy for people to access information. But there is no right or wrong answer about these events in Japan. Indeed Obama also stopped short of apologizing for this act on civilians.

Hiroshima , city of seven rivers has come a long way from that fateful day in 1945.  City has hosted Asian games in 1994, hosted a number of world leaders, the latest being Barrack Obama this year.  Hiroshima is the headquarters of Mazda motor corporation as well. Unlike the other major Japanese cities, Hiroshima does not have a subway system. Nobu attributed that to the fact that city is in a river delta & it is not suitable to build subways because of the watery nature of soil.  A few tram coaches which survived the bombing is still being run today as a memorial

After Obama's visit this year, Shenzo Abe, the Japanese PM is set to visit Pearl Harbour later this year. It is indeed a remarkable gesture aimed at reconciling differences over a troubled past.

Hiroshima is a place which can remove even traces of extremism or war mongering from a human soul.. Indeed 6th Aug 1945 was a day when humanity stood still.
Hiroshima trip was my first experience with 'Shinkansen' (Bullet Train ) as well. 330 KM from Osaka to Hiroshima was done in about 80 minutes. Have to say that, it is indeed an engineering marvel.

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Osaka,  Hiroshima,  Cyprus,  Budapest RomeBali, HamburgBerlin,  PragueCairo,  Alexandria,  Hallstatt,   SalzburgVienna,  Dachau,  St Petersburg,  MoscowIstanbul,  SeychellesVizag

Nov 12, 2016

Demonetization - The Missing Link

Indian PM made a highly risky political & economic move by removing 500/- & 1000/- rupee notes from circulation. The move aimed at curbing black money & fake currency seems to be getting equal amount of support & criticism from different quarters at the time of writing.

Currency is the lubricating factor on which economy runs. The Indian currency base as of Mar'16 is represented in the table below

Currency Note     Value ( In Rs Billion)    Volume(In Billion)  Value%     Volume% 
   10                            320                               32                            1.95%       40.8%
   20                              98                                 5                            0.6 %          6.2%
   50                            194                                4                             1.2%           4.9%
 100                          1578                              16                             9.6%         20.1%
 500                          7854                              16                            48%             20%  
1000                         6326                               6                            38.6%          8.1% 

This brings an interesting reading .  The volume of 100 & 500 rupee notes in circulation is almost identical . Assuming that demand for various denominations is a key factor behind printing decisions, there is a huge demand for 500/- rupee notes.  As per the classical economic 'equation of exchange'  ( MV = PQ ) , Monetary base ( It could be M0/M1/M2/M3 )   X velocity of money ( equals GDP .  Over the last few years, velocity of money in India has been decreasing in India, inspite of increase in monetary base.  Government doesn't publish stats as to what is the velocity of money for different currency denominations. But the increased demand of 500/- rupee note coupled with overall decreasing velocity of currency is most likely to be due to the hoarding potential of 500/-  ( and similar case with 1000/-  )  . So, Modi has a justified case - 500/-  & 1000/-  are one of the means in which unaccounted money is stashed away.

Now, how is removing 500/- and 1000/-  going to affect economy. This is where I think the planners did not get their act together. If you remove 500/- and 1000/-  , you are going to remove close to 87% of the monetary base by value & 28% by volume.  You are going to supplant that part of economy by 2000/-  and an increased circulation of 100/-  rupee notes.  Now how many 2000/- and extra 100/- rupee notes are you going to need to get back the monetary base to the same level ?

If you assume that all of the present 1000 rupee notes and say one-half of 500/- rupee notes are going to be replaced with 2000/- , the number of 2000/- rupee notes to be printed works out to be about 5.13 billion notes

The case for extra 100/- is a bit more trickier.  If half of the monetary base of 500/- is converted into 100/-  , the replacement print is going to be about 39.3 billion notes (  current circulation of 100/- as you can see from the table is 16 billion )  .  But this is not so straightforward either.  If someone goes to a shop and gives a 2000/- rupee note for an 800/- rupee product, the shopkeeper needs to give 12 hundred rupee notes in balance.  Now, this is going to put a huge demand for 100/- rupee notes. And it won't be easy for banks /Govt / RBI to cope up with the increased demand for 100/- rupee notes.

Imagine the below red-line ( volume ) as an air-pocket ( economic activities ) trapped under a semi flexible structure.  You are going to pinch the 500 & 1000 into zero, but by opening a 2000/- band and an increased band of 100/- .. The trapped air under the 500/-  and 1000/- would manifest as pressures at 2000/- & 100/-  . The increased pressure on those bands could be equated as a need to print more notes.  Unless the circulation of 100/- notes is dramatically improved , economic activity is going to get hampered seriously .

This is where I feel Government should have acted differently- It should have simultaneously come up with denominations of say 250/-  , 400/- , 750/-  along with recalibrating of ATM's.  Otherwise, doesn't matter how much ever 2000/-  they are going to print. it'll just manifest as increased scarcity of 100/- to the common man & small time traders.  Already the impacts are seen in the economy  where inspite of  the availability of 2000/- , business is not smooth as usual.

Hence, I think this is going to put a serious deflationary effect on economy at the grass root level. On the positive side, real estate prices are going to come down,  cash-less ( cards / wallets ) businesses are going to get a boost .