Mutual Fund Insight

Yun hota to kya hota?

hitlerVivek Kaul

In August 2014, the world marked the hundredth anniversary of the outbreak of the First World War. Over the years, a lot of analysis has happened on why the First World War happened. But what most historians do not talk about in their elaborate theories is that the War might have started just because a car happened to take a wrong turn.
At around 11 AM on June 28, 1914, a chauffeur of an automobile carrying two passengers in Sarajevo, happened to make a wrong turn. The car wasn’t supposed to make this turn and leave the main street. But due to the mistake of the chauffeur it ended up in a narrow lane and stopped right in front of a Gavrilo Princip, a 19-year-old student. But that wasn’t Princip’s only identity. He was also a member of the Serbian terrorist organization Black Hand.
Princip couldn’t believe his luck. He drew out his pistol and fired twice killing the two passengers in the car. Princip had recognized them and gone ahead and pulled the trigger. They were Archduke Franz Ferdinand and his wife Sophie of the Austro-Hungarian Empire. Earlier in the day, Princip and his friends who “wanted to promote the cause of a greater Serbia,” had unsuccessfully tried toassassinate Archduke Ferdinand by lobbing a grenade at him. The attempt had gone wrong and Princip had escaped and walked into the narrow lane to have a light snack. And there he ran into Archduke Ferdinand.
The assassination led to a series of events in a politically fragile Europe and started what was first known as the Great War and later came to be known as the First World War. As Mark Buchanan writes in Ubiquity “The First World War is the archetypal example of an unanticipated upheaval in world history, the war sparked by ‘the most famous wrong turn in history,’ and one may optimistically suppose that such an exceptional case is never likely to be repeated.
Historians over the years have analysed a number of reasons that caused the First World War. As Ed Smith writes in Luck—A Fresh Look At Fortune “In this version of history, the assassination merely lit the fuse, but the tinderbox would have surely exploded anyway.”
Would that have been the case? “Perhaps. But had Princip not killed Ferdinand in Sarajevo, the outbreak of the First World War would have at the very least been delayed. A war delayed is a war averted.”
Hence, it is a very interesting “counterfactual” to consider as to “what if” the Archduke’s chauffeur had not made that wrong turn that he did in June 1918. Possibly, the First World War would have never happened and the world would have turned out to be a much safer place. As Buchanan writes “When the First World War ended five years later, 10 million lay dead. Europe fell into an uncomfortable quiet that lasted twenty years, and then the Second World War claimed another 30 million. In just three decades, the world had suffered two engulfing cataclysms. Why? Was it all due to the chauffeur’s mistake?”
A few years after the chauffeur’s wrong turn, on December 13, 1931, an English politician “perhaps forgetting that American cars drive on the right-hand side of the road” met with an accident. The car was travelling at the speed of 35 miles per hour and could have easily killed him. But he survived and even wrote a 2400 word article detailing his “near-death” experience and made £600 in the process. The politician was Winston Churchill, who would successfully defend the United Kingdom against Germany during the course of the Second World War.
The question to ask if what would have happened if Churchill had died on that day. “There would have been no Churchill…to take over from Neville Chamberlain, no Churchill to galvanize Britain as it stood alone in 1940. What then? A successful German invasion…an occupied Nazi Britain…an isolationist America staying out of the War…And the whole history of the second half of the twentieth century would have been radically different,” writes Smith.
All this because there would have been no Winston Churchill to take on Adolf Hitler. But what if there had been no Adolf Hitler? A few months before Churchill was knocked down in New York, a young Englishman called John Scott-Ellis was spending sometime in Munich, Germany so that he could learn a new language.
As Smith points out “After a week in his new city, on a clear sunny day, Scott-Ellis bought his gleaming red Fiat and gave it a test drive around the streets of Munich…But a pedestrian crossed the road without looking left – just as Chruchill would do on Fifth Avenue[New York] four months later. ‘He walked off the pavement, more or less straight into my car,’ Scott-Ellis recalled.”
The pedestrian did not seriously injured himself. Three years later while waiting for an opera to start Scott-Eliss ran into that man again and introduced himself. He asked the man, whether he remembered about the accident, the man did.
Scott-Ellis did well in life and “became one of the great British racehorse owners”. As Smith writes “He often told the story of that crash in Munich in 1931: ‘For a few seconds, perhaps, I held the history of Europe in my rather clumsy hands. He was only shaken up, but had I killed him, it would have changed the history of the world.”
Scott-Ellis had run his car into Adolf Hitler.
History is influenced by fairly random small events, which have an overbearing impact on it. But these small random events do not make for ‘sexy’ theories that historians and analysts like to come up with and in the process these events get lost from public memory.
As Buchanan writes about all the history that has been written around what caused the First World War: “On the matter of the causes and origins of the First World War, of course, almost nothing has been left unsaid…The number of specific causes proposed is not so much smaller than the number of historians who have considered the issue, and even today major new works on the topic appear frequently. It is worth keeping in mind, of course, that all this historical ‘explanation’ has arrived well after the fact.”
To conclude, it is worth remembering, what the great Mirza Ghalib, who had a couplet for almost everything in life, had to say on this: “hui muddat ke ghalib mar gaya par yaad aata hai wo har ek baat par kehna ke yun hota to kya hota.”

The column originally appeared in Mutual Fund Insight magazine dated Oct 2014

(Vivek Kaul is the author of the Easy Money trilogy. He tweets @kaul_vivek) 

Number tricks

rupee

The main page of one of India’s largest e-commerce websites advertises an array of products which can be bought from it. It is interesting to see the prices of a large number of products being sold. As I write this in early August there is a bag being sold for Rs 399, an LED television for Rs 12,299, an insect repellent for Rs 199, a telephone for Rs 14,899, a pair of sunglasses for Rs 1399, a watch for Rs 999 and so on. There are many books also being sold at prices of Rs 299, Rs 399 and Rs 499 respectively.
There is a clear effort to sell products at a price which ends with the digits 99. Hence, the LED television does not cost Rs 12,300 but Rs 12,299. And the watch does not cost Rs 1,000 but Rs 999. This is the e-commerce avatar of what is basically an age-old marketing trick.
The original explanation for this trick was that it was a technique used by retailers to deter theft by their cashiers, before computers had made an appearance in retail. If something was priced at $1, the cashier could simply put the money into his pocket, when the consumer paid for it. But if the same product was priced at $0.99, it was unlikely that the consumer would offer the exact amount to pay for the product. He was likely to pay $1. Hence, the cashier would have to open the till to repay one cent to the consumer and the moment he did that, the chances of him recording the sale and not pocketing one dollar, went up. But this explanation sounds too good to be true in this day and age.
As Tim Harford the author of such wonderful books like The Undercover Economist asks in a column “Cunning. That’s not really why product prices end in 99p[pence], though, is it?” “Probably not – perhaps it once was, but in a world of credit cards, e-commerce and self-checkout, the story does not really fit. We need to look for a psychological explanation,” Harford goes onto write.
The real reason behind products being sold at prices ending in 99, lies in the fact that most people read from left to right and because of that the first digit of the price registers the most on the human mind. This is referred to as the left-digit effect. As Alex Bellos writes in his new book Alex Through the Looking Glass “When we read a number, we are influenced by the leftmost digit than we are by the rightmost since that is the order we read, and process, them. The number 799 feels significantly less than 800 because we see the former as 7-something and the latter as 8-something.”
Due to this reason since the 19th century shopkeepers have chosen prices ending in 9 and hence tried to create the impression that a product is cheaper than it actually is. “Surveys show that anything between a third and two-thirds of all retail prices now end in 9,” writes Bellos. In fact, controlled experiments carried out by economists have shown that when prices end in 99, sales tend to go up.
As Bellos points out “In 2008, researchers at the University of Southern Brittany[in France] monitored a local pizza restaurant that was serving five types of pizza at €8 each. When one of the pizzas was reduced in price to €7.99, its share of sales rose from a third of the total to a half. Dropping, the price by one cent, an insignificant amount in monetary terms, was enough to influence customers decisions dramatically.”
In fact, just ensuring that the price of a product ends with the digit 9 leads to better sales. Eric Anderson and Duncan Simester explain this very well in a Harvard Business Review article titled Mind Your Pricing Cues published in September 2003. As they write “Response to this pricing cue is remarkable. You’d generally expect demand for an item to go down as the price goes up. Yet in our study involving women’s clothing catalog, we were able to increase demand by a third by raising the price of a dress from $34 to $39. By comparison, changing the price from $34 to $44 yielded no difference in demand.”
E-commerce, which is the newest kid on the block when it comes to retail business, has been using this age-old trick very well. Interestingly, researchers also point out that pricing a product ending with digits 9/99 acts in the same way as a sale sign and tells consumers that they are getting a good deal. “Some retailers do reserve prices that end in 9 for their discounted items. For instance, J. Crew and Ralph Lauren generally use 00-cent endings on regularly priced merchandise and 99-cent endings on discounted items,” write Anderson and Simester.
Even Bellos makes a similar point in his book. As he writes “An up market restaurant, for example, would never dream of pricing a main course at, say, £22.99. Nor would you trust a therapist who charged £ 59.99 a session. The prices would be £23 and £60, which feel both classier and more honest.”
An e-commerce website trying to sell everything under the sun, doesn’t need to be classy. It’s unique selling proposition is based on giving the consumer a better deal than he is likely to get if he were to buy the same product from a local shop. Hence, it makes tremendous sense for e-commerce websites to price products ending with digits 99 and give the consumer a sense that he is getting a better deal.
To conclude, there is another number trick that the e-commerce websites can use to drive up their sales. Researchers at the Cornell University tested a very interesting idea at a Cafe in Hyde Park, New York. They found that consumers tend to spend more when the currency sign was left out of the menu. Hence, consumers were quicker to spend money when the price was listed as 10 rather than $10. By doing this they were able to increase sales by 8%. By leaving out the dollar sign, the researchers ensured that the “price of paying” response wasn’t triggered while paying and hence, the consumers ended up paying more.
This is something that e-commerce websites in India can easily test by doing a controlled experiment. Prices without the rupee sign can be offered to one set of customers. And prices with the rupee sign can be offered to another set of customers. The results can then be checked out to see if there is any increase in sales.

The article originally appeared in the Sep 2014 edition of Mutual Fund insight magazine.

(Vivek Kaul is the author of Easy Money: Evolution of the Global Financial System to the Great Bubble Burst. He can be reached at [email protected])

Investing lessons from football penalties

goalkeeperVivek Kaul 

By the time you get around to reading this, the football World Cup would have already started. And hopefully the referees would have awarded a few penalty kicks by then as well.
A penalty kick is by far the easiest way to score a goal in football. As Steven D. Levitt and Stephen J. Dubner write in Think Like a Freak “75 percent of penalty kicks at the elite level are successful.”
In fact, the goalkeeper cannot wait for the footballer taking the penalty to kick the ball. The ball takes around 0.2 seconds to reach the goal after it is kicked. Hence, this does not give enough time to goalkeeper to figure out the direction in which the ball is kicked. He has to take a guess in which direction the ball will be kicked and jump (either to his right or his left). If he gets the direction wrong, then the chances of a goal being scored “rise to about 90 percent”.
Given this, which direction do goalkeepers jump in? As Levitt and Dubner write “If you are a right-footed kicker, as most players are, going left is your “strong” side. That translates to more power and accuracy—but of course the keeper knows this too. That’s why keepers jump toward the kicker’s left corner 57 percent of time, and to the right only 41 percent.”
What does this mean? It means that they stay in the centre only 2 percent of the time. Hence, the for a footballer taking the penalty it makes immense sense to aim for the centre of the goal. He is more likely to succeed in scoring a goal. But only 17 percent of kicks are aimed for the centre of the goal.
Now why is that the case? Why don’t kickers hit the ball towards the centre of the goal where the chances of scoring the goal are the highest? A simple reason is kickers want to maintain some mystery instead of doing the same thing all the time (i.e. aim towards the centre of the goal). If every kicker started kicking the ball towards the centre of the goal all the time, goalkeepers would soon figure out what is happening and factor that in.
But there is a more important reason than just trying to be unpredictable. As Levitt and Dubner point out “Picture yourself standing over the ball. You have just mentally committed to aiming for the center. But wait a minute—what if the goalkeeper doesn’t dive? What if for some reason he stays at home and you kick the ball straight into his gut and he saves [the goal]…without even having to budge? How pathetic will you seem!”
So you decide to take the “traditional route” and aim for one corner of the goal. If the goalkeeper saves the goal, then so be it. At least you won’t seem pathetic and be accused of doing a dumb thing.
At a more general level what this means is that people feel more comfortable being a part of a “herd” and doing things that everybody else around them seems to be doing. And this applies to the investment industry as well.
An excellent example of this comes from the dot-com bubble. By the end of 1999, even though the stock market had reached astonishingly high levels, the Wall Street analysts were still recommending that investors should continue to buy stocks. According to data from Zack Investment Research, only about one percent of the recommendations on some 6,000 companies were sell recommendations. The remaining 99 percent was divided between 69.5 percent buy recommendations and 29.9 percent hold recommendations (i.e., don’t buy more shares but don’t sell what you already own). The dot-com bubble started losing steam March 2000 onwards.
Bob Swarup explains this phenomenon in Money Mania in the context of investment managers.As he writes “Don’t stick your head above the parapet. Run with the pack. There is safety in numbers, especially in bad times. It may not the rational human’s choice but it is the sensible human’s choice.”
Running with the herd is a sensible human’s choice due to two reasons. “First, the notion of inclusivity is powerful and can create perverse economic incentives that encourage crowding. Second, having decided to go with the flow, we are good at convincing ourselves that there are strong rational bases for what is essential a primal urge to belong and conform.”
An excellent recent example of this phenomenon is the current upgrading of the Sensex/Nifty targets by almost all stock brokerages. Targets as high as the Sensex reaching 35,000 points by December 2015, have been bandied around. This is not to say that the Sensex will not reach the target. It may. It may not. That time will tell and I really don’t know.
But the point is that there is not one stock brokerage out there which has a different point of view. How is that possible? Every stock brokerage is telling us that the economic problems of this country are over because a new government which “seems” to be reform oriented will deliver and set everything right. And happy days will be here again.
But as we all know, hope as an investment strategy, can be a pretty dangerous thing. Shouldn’t at least one brokerage be discounting for that? But they are not. As Swarup explains “no financial institution wants to be an outlier.”
Further, it needs to be pointed out here that investment managers are not the only ones who like to move in a herd. Economists do that as well, specially the ones who work on the policy side with the government. Given this, it limits their ability to spot bubbles and financial crises. In order to that they need to move against the herd. And that is a huge risk to take.
As Alan Greenspan writes in The Map and the Territory —Risk, Human Nature and the Future of Forecasting “In my experience, if policy makers are in a minority and wrong, they are politically pilloried. If they are in a majority, and wrong, they are tolerated and the political consequences are far less dire.”
To conclude, John Maynard Keynes explained this phenomenon brilliantly when he said “Worldly wisdom teaches that it is better for the reputation to fail conventionally than to succeed unconventionally.”
The article originally appeared in the Mutual Fund Insight magazine July 2014  

(Vivek Kaul is the author of the Easy Money trilogy. He can be reached at [email protected]) 

Of financial inequality and the financial crisis

thomas piketty

Thomas Piketty, a French economist, has taken the world by storm. His book Capital in the Twenty-First Century has been the second bestselling book on Amazon.com for a while now. Originally written in French, the book was translated into English and released a few months back in the United States.
Piketty’s Capital is not like some of the recent popular books in economics like Freakonomics or The Undercover Economist. It is a book running into 577 pages (if we ignore the notes running into nearly 80 pages) and is not exactly a bedtime read.
My idea is not to summarize the book in this column. That would be doing grave injustice to the book. Nevertheless I wanted to discuss an important point that the book makes.
A major but not so well discussed reason behind the financial crisis was the increasing inequality in the United States. Piketty discusses this in great detail in Capital.
The top 10% of the American population earned a little more than 50% of the national income on the eve of the financial crisis and then again in the early 2010s. In fact, if we look at income without capital gains, the top 10% earned more than 46% of the national income in 2010, which is already significantly higher than the income level attained in 2007, before the financial crisis started. The trend continued in 2011-2012 as well. In 1976, the top 10% of households earned around 33% of the national income.
The situation becomes even more grim when we look at the top 1% of the population. The top 1% of the households accounted for only 7.9% of total American wealth in 1976. This would grow to 23.5% of the income by 2007. This was because the incomes of those in the top echelons was growing at a much faster rate. The rate of growth of income for the period for those in the top 1% was at 4.4% per year. The remaining 99% grew at 0.6% per year.
A major reason for this inequality has been the pace at which the salaries of the top management of American companies have gone up. As Piketty writes“We’ve gone from a society of rentiers to a society of managers…Top managers[who Piketty calls supermanagers] have the power to set their own remuneration…or by corporate compensation committees whose members usually earn comparable salaries…in some cases without limit and in many cases without any clear relation to their individual productivity, which in any case is very difficult to estimate in a large organization.” This phenomenon was seen mainly in the United States, writes Piketty. But it was seen to a lesser extent in Great Britain and other English speaking developed countries in both the financial as well as non financial sectors.
In fact, Piketty even calls this phenomenon of senior managers being paid very high salaries as a form of “meritocratic extremism” or the need of modern societies, in particular the American society, to reward certain individuals deemed to be as “winners”. Interestingly, research shows that these winners got paid for luck more often than not. It shows that salaries went up most rapidly when sales and profits went up due to external reasons.
The solution to this increasing inequality of income was to some extent more education. But that is something that would take serious implementation and at the same time results wouldn’t have come overnight. How does a politician who has to go back to the electorate every few years deal with this? He needs to plan and think for the long run. But at the same time he needs to ensure that his voters keep electing him. If the voters don’t keep electing him in the short run there is nothing much he can do to improve things in the long run.
This is precisely what happened in the United States. Politicians addressed the issue of inequality by making sure that easier credit was accessible to their voters. Raghuram Rajan, currently the governor of the Reserve Bank of India, explains this very well in his award winning book Fault Lines: How Hidden Fractures Still Threaten the World Economy: “Since the early 1980s, the most seductive answer has been easier credit. In some ways, it is the path of least resistance…Politicians love to have banks expand housing credit, for all credit achieves many goals at the same time. It pushes up house prices, making households feel wealthier, and allows them to finance more consumption. It creates more profits and jobs in the financial sector as well as in real estate brokerage and housing construction. And everything is safe—as safe as houses—at least for a while.”
Hence, the palliative proposed by politicians for the increasing income inequality in America was easy credit. As Michael Lewis writes in The Big Short – A True Story “How do you make poor people feel wealthy when wages are stagnant? You give them cheap loans.”
While, the government and the politicians worked towards making borrowing easier, there is another point that needs to be made here. As income levels stagnated at lower levels, a large section of the population had to resort to taking on debt and this contributed to the financial instability of the United States. As Piketty writes in Capital “One consequences of increasing inequality was virtual stagnation of the purchasing power of the lower and middle classes…which inevitably made it more likely that modest households would take on debt, especially since unscrupulous banks and financial intermediaries….eager to earn good yields on enormous savings injected into the system by the well-to-do, offered credit on increasingly generous terms.”
So, it worked both ways. The government made it easier to borrow and the people were more than willing to borrow. As author Satyajit Das puts it “Borrowing became a substitute for rising incomes.”
This wasn’t surprising given that the minimum wage in the United States when measured in terms of purchasing power reached its maximum level in 1969. At that point of time the wage stood at $1.60 an hour or $10.10 in 2013 dollars, taking into account the inflation between 1968 and 2013. At the beginning of 2013, it was at $7.25 an hour, lower than that in 1969, in purchasing power terms.
The easy money strategy that has been followed in the aftermath of the financial crisis has again worked led to increasing inequality. The American stock market has rallied by more than 150% in the last five years and this has benefited the richest Americans.
In the five year bull run, the stock market generated a paper wealth of more than $13.5 trillion. In fact, in 2013, the market value of listed stocks in the United States went up by $4 trillion. This benefited the top 10% of Americans who own 80% of the shares listed on stock exchanges.
A similar thing happened in the United Kingdom, where the Bank of England admitted in 2012 that its quantitative easing program boosted the value of stocks and bonds by 25% or about $970 billion. Almost 40% of these gains went to the richest 5% of the British households.
Interestingly, the salaries of CEOs in the United States have continued to go up, even after the financial crisis. If one considers the Fortune 500 companies, the average CEOs salary is 204 times that of their rank and file workers. This disparity has gone by 20% since 2009.
At the same time, the income of the median American household fell to $51,404 in February 2013. This was 5.6% lower than what it was in June 2009. Further, the average income of the poorest 20% of the Americans has fallen by 8% since 2009. Given this, more than 100 million Americans are receiving some form of support from the government.
In fact new research carried out by Emmanuel Saez and Thomas Piketty reveals that between 2009 and 2012, the top 1% of income earners in the United States enjoyed a real income growth of 31%. Income for the bottom 90% of the earners shrank.
The point being that the Western world does not seem to have learnt from its past mistakes. As George Akerlof and Paul Romer wrote in a research paper titled Looting: The Economic Un­derworld of Bankruptcy for Profit, “If we learn from experience, history need not repeat itself.”If only that were the case!

Note: Not all data has been sourced from Thomas Piketty’s Capital in the Twenty-First Century. Some numbers have been sourced from Raghuram Rajan’s Fault Lines.

The article originally appeared in the June 2014 edition of the Wealth Insight magazine

(Vivek Kaul is the author of the Easy Money trilogy. He can be reached at [email protected]) 

The wilful blindness of Manmohan Singh

Manmohan-Singh_0Vivek Kaul

The stock market crash of October 1929 started the Great Depression in the United States, from where it spread to large parts of the world. Some of the best books on the Great Depression, which are still being read, started to appear only 25 years later.
My favourite book the Great Depression is The Great Crash 1929, written by John Kenneth Galbraith. The book was first published in 1954, twenty five years after the Depression started. Milton Friedman and Anna Schwartz’s A Monetary History of the United States, 1867-1960, which dealt with the Great Depression in considerable detail, came out only in 1963. This book set the agenda for how central banks around the world reacted to recessions.
In fact, books on the Great Depression are still being written. A recent favourite of mine is Lords of Finance—1929, The Great Depression, and The Bankers Who Broke the World, written by Liaquat Ahamed, which was published in 2009. It won many awards including the Pulitzer Prize for history. What is true about the Great Depression is also true about Mahatma Gandhi. Some of the best biographies on the Mahatma, like Gandhi Before India, have appeared in recent times.
Dear reader, before you start wondering why am I talking about the Great Depression and Gandhi, in a column which is supposedly on Manmohan Singh, allow me to explain. The point I am trying to make here is that the best history is usually written many years after something has happened. The gap is probably necessary to allow historians to iron out the noise. Also, over the years new sources of information appear, which were not available in the first place. For one, documents get declassified. At the same time, letters that the men and women being profiled wrote, appear in the public domain and so on.
Hence, the defining history on Manmohan Singh’s years as the Prime Minister of India will most probably be written a few decades from now. Having said that, it is easy to predict that historians won’t project Singh in a good light.
The story that one usually hears about Singh is that he was an honest man heading a dishonest and a corrupt government. While his ministers may have made money being corrupt, he never did. This is a very simplistic explanation of the entire scenario.
A major reason why Manmohan Singh survived as the Prime Minister of India for a full decade was because he was ‘wilfuly blind’ to a lot of nefarious activities happening around him. Wilful Blindess is a legal concept that was first applied in the British courts in 1861.
As Margaret Heffernan writes in Wilful Blindness- Why we ignore the obvious at our peril“A judge in Regina v. Sleep ruled that an accused could not be convicted for possession of government property unless the jury found that he either knew the goods came from government stores or had ‘wilfully shut his eyes to the fact’…Over time, a lot of other phrases came into play – deliberate or wilful ignorance, conscious avoidance and deliberate indifference. What they have all in common is the idea that there is an opportunity for knowledge and a responsibility to be informed, but it is shirked.”
Manmohan Singh’s decade long tenure as the Prime Minister needs to be viewed through the lens of wilful blindness. He was wilfully blind to A Raja running the telecom industry for his own benefit. Singh was also wilfully blind to the coalgate scam where coal mines were given away free to both public sector and private sector companies. In fact, he was the coal minister when a large number of mines were given away free.
In fact, as Heffernan writes “the law does not care why you remain ignorant, only that you do.” Also, on some occasions the wilful blindness comes from that “we focus so intently on the order that we are blind to everything else.” Singh was so focussed on following the orders of Sonia Gandhi, who was the actual head of the government, that he chose to remain ‘wilfully blind’ to all that was happening around him.
Interestingly, when Enron went bust in the early 2000s, Jeffrey Skilling and Kenneth Lay, the CEO and Chairman of Enron, pleaded that they just did not know what was going on in the company and hence, could not be held responsible for it.
Judge Lake who was hearing the case invoked the concept of wilful blindness. As he instructed the jury: “You may find that a defendant had knowledge of a fact if you find that the defendant deliberately closed his eyes to what would otherwise have been obvious to him. Knowledge can be inferred if the defendant deliberately blinded himself to the existence of a fact.”
The phrase to be marked in the above statement is “closed his eyes”. The only way Singh could not have known about what was happening around him was if he had closed his eyes to it.
“Magicians never reveal their secrets,” writes Scottish writer Ian Rankin in his latest crime thriller Saints of the Shadow Bible. Singh was no magician. If he wants history to treat him a little better than it actually might end up doing, it is best that he spends his years in retirement writing his memoirs of the ten years he spent as India’s Prime Minister, like Winston Churchill did.
Churchill in the years after the Second World War wrote his version of history of the Second World War and even won the Nobel Prize in Literature in 1953. Singh needs to do the same. That way history might also consider his point of view.

The article originally appeared in the June 2014 issue of Mutual Fund Insight

(Vivek Kaul is the author of the Easy Money trilogy. He can be reached at [email protected])