September 17, 2008
In addition to ITC and UB becoming employers of choice, one further consequence of the investment banking meltdown is that Chetan Bhagat might soon be unemployed.
I can’t decide if this is good or bad. On the one hand, unemployment might mean he would start writing full time, and we would face the horrific prospect of a new Chetan Bhagat book every year. The horror!
On the other hand, it might force him to actually get a real and respectable job, like becoming a traveling salesman for Fair and Louwly in Coastal Andhra and South Andhra. True, he would probably be completely out of his depth at honourable work, but I’m sure even Chetan Bhagat can learn. And if that happened, he would have no time to write, thus sparing us all.
I feel that the pessimistic case is more likely, for the very reason I mentioned yesterday: in a depression, the vice economy does well. There is a lot more pain ahead.
September 16, 2008
My laziness and writer’s block resulted in Gaurav beating me to it when it came to expressing schadenfreude about all the I-bankers who’re losing their jobs. (I am of course a retail banker of repute and thus less affected.) This is just the beginning, though. What will MBAs do at placements time when their are no longer any investment banks to lap them up at Slot Zero?
My prediction is that ITC and UB will become the hot new Slot Zero recruiters. Now that we’re in for a depression, vice is where the money is. As this Financial Times article points out, recessions and depressions only have a positive impact on the demand for things like alcohol, tobacco and gambling:
The alcohol, tobacco, gaming, and defense sectors, in aggregate, are defensive in nature and tend to outperform the broad market in periods characterized by relatively low returns and periods with relative stagnancy, or worse, in the U.S. economy.
Tragically, there is no India-specific Vice Fund, or Satan’s Portfolio, or I would be heading over to my bank branch to start my SIPs now.