Loud Thinking

Archive for the ‘My Views’ Category

Ambition is an earnest desire for achievement or distinction.

“If one advances confidently in the direction of one’s dreams, and endeavors to life the life which one has imagined, one will meet with a success unexpected in common hours.”

Henry David Thoreau (1817-1862);
naturalist, author, philosopher

A must read…

An article still absolutely relevant…link:- https://www.snayyar.com/mr-pm-there-are-three-options-to-avoid-imf-loan.html#sthash.DYXmcbWr.dpbs

To Improve at Work, Examine All Aspects of Your Life

It’s not an outrageous idea: devoting less time to work can ease stress and boost productivity. It can also allow you to be more engaged with your family, community, and the things you do just for you. These four-way wins – improvements at work, at home, in your community, and in your private life – take experimentation and help. Start by diagnosing your four-way view: What’s important to you? Where do you focus most of your attention? Talk to the most important people in the different aspects of your life, and find out what you really need from each other. Use these answers to better align what really matters to you and what you do, and design an experiment to improve your performance in each of the four domains; for example, start an exercise program, carve out daily time for family, join a big community project, etc. And don’t be afraid to ask someone to help you stay on track.

Adapted by HBR from “ Reduce Stress by Pursuing Four-Way Wins” by Stew Friedman.

The real story of Pak economy…!

Another eye opening letter published by the daily “Dawn” on 2 May, 2014.

Bond market delusions
Sakib Sherani
Updated about 2 hours ago

Comment Email Print

PAKISTAN has been on a ‘successful’ borrowing binge of recent. It has raised money from the IMF, multilateral creditors, the Islamic Development Bank, a consortium of international commercial banks, and now from global bond markets.

Over and above this borrowing, amounting to some $10.5 billion in 10 months, it has also raised funds through auction of 3G and 4G spectrum licences, and received a mysterious Saudi ‘gift’. While the non-debt creating flows can be regarded as a positive development, the finance minister has somewhat bizarrely ‘congratulated’ the nation on the external debt he has managed to raise in such a short space of time.

This mindset of celebrating each new round of international borrowing is not new, of course. It goes back to Pakistan’s early days, and was last on full display at the height of Gen Musharraf’s failed economic policies. That it is alive and kicking almost 10 years later — and that too under those who roundly criticised the Musharraf-Shaukat Aziz economic ‘model’ — shows how deep-rooted and durable our misconceptions and delusions are.

The country’s recent foray into the international sovereign bond market is instructive. Pakistan raised $2bn via two Eurobonds of five and 10 years’ maturity. The bond issue was oversubscribed 14 times, leading the finance minister to issue a series of self-congratulatory statements. While doing so, unfortunately, he had no qualms about using a narrative he had rightly described, while in opposition a few short years ago, as false as well as misleading.

The setting was Pakistan’s foray into the international bond markets in 2004, its first after a hiatus of many years. I was part of a team from three global financial institutions associated with the country’s return to the international capital markets. A five-year, benchmark-sized Regulation S/144a issue was oversubscribed by several times. Flush with success, the economic team of Gen Musharraf constructed the following narrative:

• Pakistan had ‘graduated’ from the IMF due to prudent economic policies followed under then-finance minister (and PM-in-waiting) Shaukat Aziz;

• The overwhelming success of the bond issue was a vote of confidence by international investors in Pakistan’s economy;

• Bond investors would be followed in droves by all kinds of other investment into Pakistan, including FDI, because the country was now on the international ‘radar screen’;

• The bond markets would monitor and ‘regulate’ Pakistan’s economic policies — implying that its policies therefore could not be off-track or simply wrong, as they proved to be;

Fast forward 10 years to 2014. The shoe is on the other foot. Senator Ishaq Dar, now the finance minister, has begun speaking from the exact same script — no doubt carefully preserved in the archives for such a day by the mandarins at the Ministry of Finance — that he had ridiculed in 2004!

On both occasions, back in the 2004-2007 period and in the past few months, the international capital markets have been flush with liquidity, and bond as well as equity investors have been pushing the risk envelope to so-called ‘frontier markets’ for higher returns. The Institute of International Finance estimates a flow of $39bn to emerging markets in March of this year alone.

Hence, around the same time as Pakistan was issuing its bonds at a yield of 7.25pc for five years, Zambia launched its second-ever global sovereign bond of $1bn. In fact, according to the Wall Street Journal, Papua New Guinea, Bangladesh, and Bhutan were lined up for their own bond issues right after Pakistan. (Back in 2004, almost right after our bond floatation, first-time issuer Mongolia got an enthusiastic reception from bond investors similar to Pakistan.)

Even Greece, which is still not out of the woods after one of the biggest sovereign credit events in history, raised over $4.1bn at 4.95pc for five years. For international bond investors, more important factors than an emerging market’s supposed economic performance or prospects are: the need to deploy excess liquidity, and the yield offered by a sovereign, especially the pick-up over other assets. A better reflection of how much ‘extra’ yield Pakistan had to offer to attract bids for its bonds is a comparison with other recent issuers; Sri Lanka’s seven-year bond, due 2021, floated two days before Pakistan, offered a yield of 5.7pc, or 155 basis points lower.

Another lesson for policymakers is that ‘praise’ from the IMF for a borrower raising money from the international capital markets should more often than not be interpreted as ‘relief’ — the preferred creditor is more assured that the risk has been transferred to bond holders!

Tailpiece: The inane and self-serving press releases issued after each meeting of the Economic Advisory Council make the body appear like a rubber-stamping forum — forever ‘endorsing the government’s economic policies’ or ‘appreciating the finance minister’ or ‘fully supporting’ something or the other. While the level of discourse and the overall process has been generally wanting so far, the truth is that the EAC has raised important issues with the government’s economic team. Two contentious issues that have been brought up recently for discussion include the ECC’s approval of two Rental Power Projects (RPPs), and the consigning by the government to the trash can of Nadra’s list of 3.2 million affluent Pakistanis not on the tax register. More on these issues subsequently.

The writer is a former economic adviser to government, and currently heads a macroeconomic consultancy based in Islamabad.

“It is a thousand times better to have common sense without education than to have education without common sense.”

— Robert Green Ingersoll

“Once the realization is accepted that even between the closest human beings infinite distances continue, a wonderful living side by side can grow, if they succeed in loving the distance between them which makes it possible for each to see the other whole against the sky. ”

Rainer Maria Rilke (1875-1926);
excerpt from Letters to a Young Poet

Once again there is a debate going on in the Pakistani cricketing circles, that should Misbah ul Haq be retained as captain of the Test and ODI teams or not? In this regard, PCB seems to be a divided house.

Firstly, it should be made clear to every player that if anyone is removed from the captaincy, it does not mean the end of his playing career. In the past, we have seen that when legendary Sir. Ian Botham was removed from the captaincy of the England’s team, not only there was a big spur in the performance of Ian Botham, but in the entire English team, was transformed for the good.

Generally, people appreciate the batting prowess of Misbah ul Haq. However, he is also being criticised for startlingly wrong team selections, unimaginative batting order decisions, defensive field placings, wrong bowling schemes and his own very slow start of the innings, even in the ODI matches. On an over all basis, now he is being labeled as a defensive captain.

However, the biggest draw back of Misbah ul Haq has been the element of favouritism which he displays for his colleagues playing with him in his domestic team. This aspect of favouritism in his personality, makes him absolutely unfit to be a leader of the national out fit.

In particular, MUH’s moves in South African tour dented his reputation very badly, when he unnecessarily called players from Pakistan, even before the start of the first Test match.

Moreover, his media statements even before the start of the series, also confirmed that he had surrendered the series before the first ball was was bowled. One should never be over awed by the paper strength of the opposition.

Going by the analogy of MUH, the Zimbabwe should have also surrendered before the start of the series against Pakistan. And now MUH has the guts to say that he was not a defensive captain. Yes, he is in fact, not worth even a defensive captain, which was a label affixed previously on the great legendary Mr. Zaheer Abbas, as well.

Captains are sheer brain and cricket is played in the mind, just like a chess game. But in MUH’s case, we are at a loss to know that he is totally devoid of the common sense, which he amply exhibited in South African series, when everybody knew that Hafeez was bothering their batsmen with new ball, MUH made sure, he was not given the new ball, at many such moments.

The whole of Pakistan knew how much Irfan bothered the SA batsmen on their pitches, but he was not selected to play the first Test match. We can easily write the details consuming reams of papers, about the common sense decisions not taken by MUH, in selection of players and during the currency of the games, specially during the South African series, champions trophy in England, West Indian and Zimbabwe tours.

How can Misbah ul Haq be retained as captain till the ODI World Cup 2015, when he led the team in the champions trophy, where Pakistan was LASTranked team among all the participants?

Handing over the task of leading the team again to Misbah ul Haq for the World Cup 2015, will be an act of hara-kiri (suicide or any suicidal action; a self-destructive act). What else could be the act of madness or insanity which was aptly defined by Albert Einstein that “doing an act, without change, over and over again and expecting a different result?”

Now, the question is what is expected from a captain? Firstly, it should be remembered that in all the team games, the role of a captain in the game of cricket, is of the prime importance. A cricket captain is invested as is an American president, with a fanciful suite of powers and responsibilities, more than any one man can bear.

A good captain can make a poor team good and a good team great. Here, we remember late AH Kardar, who had to lead a pack of Pakistani players, out of which 8-9 players were the worst fielders. But then, he always used his players in such a manner, that their weaknesses were least exposed to the opponents.

Captains in cricket have to have a brain to create victories, because victories are never offered by the opponents in a plate, rather it is carved out, on the chess board of the cricket field. Further, the captain must be a PRO ACTIVE AND MUST NOT BE A REACTIVE PERSONALITY.

It is the foremost job of the captain to always keep his team players so charged up, focused and motivated that victories are snatched from the jaws of the defeat; and not that defeats are snatched from the jaws of the victory; as happened with our team, twice during the last tour of Zimbabwe, where we lost an ODI as well as, a Test match.

In view of the foregoing and keeping under consideration of the long term interests of the Pakistani cricket, which has to plan for up to June-July 2017 Test matches, championships and 2015 ODI World Cup, there is no doubt that at the best, we have a 50:50 chance that Misbah ul Haq will be able to continue till the above named two important events.

Therefore, under the circumstances, we have two options. Firstly, to play safe, we may appoint Younis khan as captain for the ODI and the Test teams (with certain factors of fitness, age, experience, class and abilities in his favour more than any other cricketer in Pakistan), with Ahmad Shahzad as his deputy, who may take over as the captain for all the three formats of the game, after the ODI World Cup 2015. Simultaneously, to imbibe confidence and to gain the experience, Ahmad Shahzad may be appointed as captain for the T20 team, as well.

Secondly, in the midst of the experienced set of team management personnel, we can straight away, close the chapter of team players politics, for a minimum of about 5-7 years, by right away appointing Ahmad Shahzad as captain, for all the three formats of the game, of a new look futuristic Pakistan team. Yes, experienced players like Younis Khan, Misbah ul Haq and Shahid Afridi must be retained to play as seasoned members in the team, as long as, they are able to deliver.

“There is a point at which everything becomes simple and there is no longer any question of choice, because all you have staked will be lost if you look back. Life’s point of no return.”

Dag Hammarskjold (1905-1961);
Swedish political leader, Secretary-General of the United Nations

Use Workforce Analytics to Transform HR

Research shows that many companies aren’t using objective talent data to make workforce decisions – even though it can help reduce costs, identify revenue streams, mitigate risks, and execute effective business strategies. Improve your HR functions by making your analytics:
Relevant. HR analysts need to apply data to the business issue (a top-down approach), instead using up resources on bottom-up data mining.
Valid. The quality of data is important, as is the way leaders are educated about the credibility of talent metrics.
Compelling. HR can’t present raw numbers and expect the right message to come through. Analysts must understand the audience, tell a story, and deliver conclusions that tie together the principal facts.
Transformative. Talent data should help a leader make better, faster decisions.

Adapted by HBR from “ Change Your Company With Better HR Analytics” by Mick Collins.