Indian Government: Your, Mine or Ours?

As a student of Finance, Debt and Equity have always been the conceptual building blocks in my studies and in my professional life. As a quick basic introduction, both are modes of financing operations of any entity. Debt financing involves provision of capital with a promise of periodic interest payments (fixed, floating or zero) and the repayment of the upfront capital along with total interest at the end of the tenure - a home loan & the EMIs associated with it are a classic example. In this mode of financing, the financier does not have any ownership in the enterprise to which the financing is provided. As against this, in Equity financing, the financier has direct ownership (either active or passive) in the entity to which the capital is provided. The most prevalent example is owning a common share of a publicly listed company making the owner of the share a shareholder in the said company and hence a proportionate 'owner' of the entity and its business. Being an owner of the business exposes one to its risks and rewards in significantly higher proportion. The cash flows are irregular more to say and the primary source of gain is from capital appreciation of the value of the business, i.e. the Market Capitalization, of the firm. Thus, more often than not, Debt has assured cash flows, fixed periodicity and lesser risks attached to it along with zero ownership in the enterprise while Equity has proportional ownership, irregularity of cash flows and higher risk/reward attached it. For the sake of this blog, I am ignoring the convertible modes of financing.

With the basic of Debt and Equity behind us, I'll proceed with a keen observation of mine which has grown stronger in the past few months, on how politics has evolved or changed in the past five years if I look through the lens of Debt & Equity. Till 2012-13 approximately, we could see the Debt Model operating in full flow while post it, the Equity model has started taking shape with increased proportion as a percentage of our total population. I am seeing comments over the social media and outside it as well which are indicative of this difference though I am yet to come across any article explicitly putting forth such an observation. Let me elaborate:

Fiberakht

Summer is here and temperatures are going up – the Sun seems to shine much more radiantly than any time of the year and outdoor sport is now a less attractive offering. Though IPL has just commenced and cricket happens to be my favourite sport, another sport is fast challenging the numero uno status it holds in my life especially with the soaring celsius count outside. This sport is called 'Fiberakht' or simply ‘Fiberals vs Bhakts’ – the so affectionate monikers either side has bestowed lovingly on the other. Ideally, it should have been the age old ‘Liberals vs Conservatives’ but times change and so should we. The more I engage in this sport, the more I am reminded of an approximate nineteen minute TED talk by psychologist Jonathan Haidt titled ‘The Moral Roots of Liberals and Conservatives’; the more I am reminded of it, the more I tend to enjoy this sport of 'Fiberakht' - going after the fiberals, seeing them frothing and also getting insulted in this process yourself has an intoxicating charm to itself. Fun apart, Haidt’s talk is where I would like to focus as I move through this blog trying to connect it to Bhaaratiya values and the environment currently.

The Ecosystem and its Existential Crisis

Through various tales observed in the theatre of nature do we get a lot to learn. Many a times, the animals or the plants or the swishing winds or the gushing waters have a lot to communicate, a lot to teach. A cornered animal tends to fight back ferociously and we have seen/heard stories of herbivores such as bulls or gazelles too fighting back advances of carnivores and no more consider them surprising, given the circumstances. Though the event itself is no more a surprise, the ferocity involved continues to amaze me and offers a glimpse into the vast untapped energy of an entity and its ability to channel it through its own name & form. This animalistic ferocity though not illogical in any way is out on full display in our nation today and the next seventeen months look ominous with dark clouds gathering on the horizon and a cornered animal making its last stand in a battle that began five years back.