Business, Economics, Economy, India, Macroeconomy, Thoughts

More inequality or more convergence (tricks of your particular worldview)


The average Joe in Spain is now living worse off than in boom times. Anyone can tell you that. While some, many, citizens, scape the crisis altogether. Apart from the platitude as obvioulsy societies live better in Boom times than in Recession times, anyone can warn you of growing inequalities, and he will be right.

The same feeling you may have if you look at the landscape in Mumbai, India. As skycrapers grow in number and height and slums grow and invade previously green spaces, you may have the feeling of growing inequality, and you may be right.

Same feeling you may have in China, when you compare Shangai with some backward province. They would have the biggest slum on Earth if people had the chance to build it. But since they don’t, you cannot see it. But as cities expand, inequality is growing. Signs of danger in forthcoming times.

But if you think of great times, regardless of your point of view, you can think of the Mughal Empire, the Roman Empire, or even of Chairman Mao’s China, and think that the good times are behind.

But don’t make a mistake. In those glorious times, 99% of the population were at the limit of starving. Marie Antoinette may have lived as a Queen, but she ended beheaded for a reason, a reason that she could not understand when she suggested to give cookies to the mob if they were hungry. Any bad harvest could kill a sizeable chunk of the population, and if there was hunger and disease at the same time, half of the population dying was a possible scenario.

Since the industrial revolution in the Nederlands, UK, and some European locations, the things have changed. As it has been spreading all over the world, inequality is less than ever. And if some folks live worse off, is specially because they compare themselves to their richer cousins.

No one starves in Spain. Many people have made bad investment decisions and they will pay a price for it. Some will not be able to afford the holidays in Mexico this year so they will decide to stay at home. Some people I know have had to cut on Saturday restaurants. And some have real trouble to get to the end of the month, yes, but not hungry.

Many people in India and China are still starving. Many more are hungry. Obviously, too many, I may add. But less than ever. Mao’s China was probably the poorest in centuries, but Deng Xiaoping opened the capitalist way that is slowly (yes, if you think of all of China, not of the booming part only) reversing the trend. The same happens in India (and sooner it would happened if the current government was as brave as some that preceded them, instead of wasting India’s time).

Of course, if you look locally, there are some losers and some winners, but humanity wins. And if you look at the greatest foes of this 2012, you will here about debt affecting many people, but you will here a lot about public debt. Don’t blame that one on the capitalist system, blame it on bad governments.

The world overall is more equal in opportunities. More than ever. Capitalism, with its flaws, has started a globalisation trend that is only benefiting humans.

India, Personal, Thoughts

New roads ahead both for me and Warren Buffet (To India or not to India)

The office

Decisions. Whether to leave or stay. Leave from where? From India or to India? I’m not even sure of the right declension for the verb leaving.

And in the following days I do have to make a decision. Sorry for spitting it all out here, after so many blog-silent weeks. I’m in the midst of accepting an assignment here for at least three years. And the decision was already taken, yes, but as the conditions keep changing the decision needs to be remade now and again. It is said that we join companies and we leave bosses, this case could be right the opposite.

But enough about that, whatever you write can be used against you someday. Today Berkshire Hathaway has its figurehead Warren Buffet visiting India with a humbling attitude. He says he will talk to the Prime Minister, Manmohan Singh, about whatever Manmohan Sing wants to talk about. He also says he’s late to be in India and that from now one he will make a big investment per year in this country. He also says, and that’s why I called him figurehead, that the guy that makes the most money for Berkshire Hathaway is not him, but an Indian as well, in charge of the insurance business. Obviously the Indian press have quickly jumped to call him the heir.

Such a great entrance! Humility around an iron fist. Ladies and gentlemen, there is no business as show business. This is what I call the new American soft power. Humble but right to the Prime Minister in a country where business still relies on personal contact! They know how to do it. Actually, if I could, I’d join their ranks right now.

My road is humbler indeed. Not to be leading a huge investment company with resources aplenty but to develop business in India. A tough job. Another learning experience and, hey, in the end it’s all about learning. But also means leaving behind other personal development experiences and obviously a very important part of my life.

What is it that I want to be? Where do I want to be in five years time? I need to figure out as soon as possible as only then I will be able to make the right decision.

Business, Economy, India, Macroeconomy, Microeconomy, Private Equity, Thoughts

Recovery or rebound? (long lasting pains)

It’s always nice to hear that Japan has grown a 3.7%. It makes eye-catchy headlines. But if you go deeper you see that the figure is just the annualisation of a mere 0.9% between April and June, and that in the first quarter the slump was around 11%. What does that tell us about statistical significance? After all, interpreting the figures will always be mediated by our wishful thinking.

A quarter may take us out of a formal recession but won’t make a new trend. I am the first whose wishful thinking would like this to be over, but it doesn’t seem likely to me. Still a lot of pain to endure to reverse the trend. Many things are pending to be able to grow healthily, albeit I admit that growth doesn’t need to be healthy to be growth.


And when growth gets here again, there will be more pain to endure. Companies have made put themselves in protection mode, rightsized…sorry, I meant downsized; they may have made extraordinary things to get their products moving, to appease their customers and investors. Everything to get to the end of the tunnel. But that won’t be enough.

I hate to seem gloomy. I am not. My message here is quite simple. Even if we find the right path for recovery, we won’t be at the same place we’d left. Things will have changed. When the scared company opens its shell again, it may find itself in a very different place. Some currents will have dried out. Fortunately, and that’s where my optimism lies, new wells will start flowing, somewhere. But they won’t be at the same place we took for granted long ago.

Also we will have proven our customers there are other ways, that we can do more with less. That we can remove that slack, streamlined our operations, adjusted our overheads and given better quotes. Hopefully, they will have based their recovery on that, they won’t let us go back again to the previous business conditions. And we will have to adapt to that: more pain. The leakage of jobs will go on after the recovery is here. And no sense of urgency can last forever. Sometimes it’s easy to retrench than to transform oneself.

A silly example from my daily life. Calling from India to Spain five minutes costs 10€ with my Spanish cell. Driven by the necessity not to waste resources, the experiment is to do the same with my Indian cell: 54 rupees, which are approximately 0.85€. Do you think I’m going to use my Spanish cell here again?

Although this might seem irrelevant, it’s a sign that we customers are not that stupid after all.

Did you know that the Hilton Group is about to become extinct? Blackstone bought it for $26 billion in 2007, right now they owe $21 billion in debt. Refinancing that debt won’t cost that much right now, that’s not the problem. The problem is somewhere else: executive customers have massively forgot their loyalty to the firm seeking cheaper alternatives.

Did you know that the huge amount of money that Air India is losing just required its intervention? Probably you did. Same happens with other main Indian Airlines. The interesting part is that the low cost carriers that operate here are not losing money.

And when we are out of the crisis, if Air India and Hilton make it, surely by reducing prices and streamlining operations, the customers they will face will get accustomed to the new conditions and will keep asking more for less. After all their own streamlining depends on that. What used to be exceptional will become somehow the norm and the companies not aware of that change will suddenly open their shells in a dry desert.

India, MBA, Personal, Projects, Thoughts

New challenges (new continent, new airport, new terminal)

It’s been a while since my last post. Lots of things have changed. Suddenly I was pushed out of my comfort zone, something very healthy that we should experience once in a while and now, today, I realise this is the first day in weeks that I’m able to sit and reflect over what has been happening. And I also realise that a dose of personal development is what I currently need. You know my recurrent idea: it’s only when you reflect when you really learn!


So here I am, resting for a few days in an old strip of coast in Catalonia, a small thousand-year-old country that resists his identity to be dissolved into those huge empires of today and of the last centuries. This coast has witnessed countless invasions, and we’ve also invaded from here, made a Mediterranean empire and, as well, sent the boats that discovered America (yes, we did, although the Spanish Inquisition spent centuries to erase almost every trace of it, and to build a different story from another place that never had a good naval tradition, or good sailors, or even the willingness to discover anything).

But let’s not get into politics, and accept my apologies if I have offended anyone. After all the macro-economic data shows who works and who gets the subsidies in this unemployment prone Spain where some territories send the money for the others to keep procrastinating.

Sorry again. It seems that too much work has taken my knives out. Again, this is not about politics, it’s about entrepreneurship.

And I hate to boast, but this time I’m proud of having commissioned a terminal which with 544.000 square meters is the biggest in Europe, and, opposite to what happened in London or Madrid, it worked the first day. Yes, we did some things differently. Yes, we were also lucky. Yes, we learnt so many things in the process.

Well, the thing was that everything worked from day one. And kept working in day two, three, four and five…

On day six, I’m not sure what happened. I was on a plane. Day seven I was in India. Day eight I was starting a new project there. A local partner, new customer, new airport, new terminal, different continent, different culture, speaking in English 24/7, living in a different place.

And here I am still riding the wave. The beginning of a project is usually tough, specially when you got little time for the wheel to start spinning, specially when everything is different than what you used to have, specially when you’ve spent many years in a huge project, building a new airport from scratch, playing every role, mastering every trade.

This is what I wanted to share with you. I’ll keep blogging, this time from New Delhi, or Gurgaon. I’ll keep working, trying to have a small impact in another terminal: T3. I’ll keep learning, as I passed my MBA second year final exams, which happen to be the last ones. Now almost in my third year, I only need to finish an assignment for that.

And, in the meantime, Barcelona’s T1 keeps working 🙂

Next post next week, back in India…