The stupidity of mathematical predictions...

The world will hit a population of 9 billion from its current 6.5 Billion in 2050. This will largely be an older population which coupled with widespread environmental degradation will cause immense hardships in 2050.

Now this statement is absolutely factually correct but still stupid. It assumes that the world will suddenly wake up to this problem in 2050 and the issues will all come to roost in that year. The changes propsed in the piece are not going to be true one fine morning - they will instead build up from 2009 - 2050. And the homo sapiens will adapt to it and influence it in ways which may render the predictions completely false. This fact is completely ignored in predictions such as this one - which are mathematically built without considering the changes which would happen as a gradual build up of the facts being predicted in the INTERVENING period. And thats why they are stupid - they ignore the intervening period. And that is why all dire predictions made in the past about our today too have never come true.

Smaller Banks, Local Connect...

Reading through an article in the Economist which talks about how local, smaller, geographically spread banks serve populations better than large conglomerated banks -

"Governments in low-income countries should recognise the strategic importance of small, private domestic banks. They should also carry out some fundamental reforms. On the demand side of the equation, entrepreneurs in developing economies need to be able to signal more easily that they are creditworthy. Sustained efforts to improve credit and collateral registries offer large pay-offs. Credit registries enable first-time entrepreneurs to document their personal credit histories and share them with lenders. Collateral registries enable lenders to verify that assets such as property and vehicles have not already been pledged by the borrower to secure past loans. Transparent and efficient court procedures allow lenders to seize collateral in the event of loan defaults. "

Really vouch for the second item on the list. Being able to show your credit worthiness is such an important part of the whole equation for that small farmer in rayalseema...What the article seems to miss is the whole online nature of banking transactions these days as it cites historical examples to support these points. But then again the spread and degree of comfort with online/mobile banking are entirely different matters where again the authors theory would stand ground...

Story-Link-http://www.economist.com/businessfinance/displaystory.cfm?story_id=13986299

Rein in the banks...Link Capital requirement norms to size of their books...

Well, the subject pretty much says everything I want to say in this article. Short point, as we seek the global recovery, need to have higher capital requirment norms for the banks. My humble suggestion would be to link the %age required to the size of the bank..i.e 4% if the size of your books is $1 Billion - 8% if its between $1 billion to $2 billion, 12% beyond $2 Billion etc... What say?