Tuesday, January 20, 2009

does faith have economic value



Frankly, I don't understand recession. The irony is that nobody really does (at least in my vicinity) but everybody talks about it. Like Feynman said
On the contrary, it's because someone knows something about it that we can't talk about physics. It's the things that nobody knows about that we can discuss. We can talk about the weather; we can talk about social problems; we can talk about psychology; we can talk about international finance... so it's the subject that nobody knows anything about that we can all talk about!

Anyways, here is one of my economic meanderings. Nothing related to recession though or maybe.(I don't understand money enough to even say whether this is related)

I go to a snacks-shop (where I go regularly).Eat at whatever I like and then I realize that I have forgotten my wallet. One option now is to look around and see if there is some friend who can lend me some money. Another way should be what if I promise the shopkeeper to pay him later. Kind of like the first option. Borrowing on faith. "Tomorrow I will give you 10% extra but today I have none." So it is like an unsecured loan .
Now, is it a proper trade to exchange money for faith.Now you ask where is the exchange? I reason - in fact there are two transactions here where faith is traded.

I will try to put it here as a table.

transaction 1: I take food(of value X) I give faith(value?!)
transaction 2: I take my faith back I give (X + Y) money

So basically, I pay X for the food. What do I pay Y for?

Lets see this from the shopkeepers point of view -
Suppose he believes that the chances that you will turn up tomorrow with the money (X) plus the extra money (Y) is 1/10. Say, he has 10 such customers. Then he would say "No no, 10% is too less, I need at least 900% to make the trade fair". Fair enough you think. Because in the end he should have got say 10 times 10 = 100 rupees. But if only one person turns up he ought to have brought these 100 rupees (10 plus 90).

So far so good.

Now lets look from your point of view.
You think that it is likely that you will bring the money to him say 9 out of 10 such times if he allows you for only 10% extra. Because this will be fair.

So in the same situation if the shopkeeper believes you not to cheat, he will charge exactly the same price as what will be fair and what you are ready to pay. If out of doubt he charges more, he further decreases your chances to turn up.
So the best bet for him would be to assume that you would not cheat, or in the other extreme case to take some other action (like call the cops).

So, now I come to my point. Is it a correct trade to tell the shopkeeper, in case he has less faith in you, that you will pay him more than just 10% extra (say 50% extra) tomorrow. Of course it would be a gamble for the shopkeeper. He will accept the gamble on the basis of the following:

1. There is a value of faith (we can say p/10, where p is the number of times you will return in 10 such situations) which the shopkeeper has for you in his mind.
2. He knows that your chances of coming is also a function of percentage extra (Y).
3. So he maximizes his faith*returns.
Possible complication-
What if , the shopkeeper has more faith in us and thinks we will return much often than we intend to go?

This post is very VAGUE ! Ya, i know...

Sunday, January 11, 2009

Multilayered EGO



I often, generally in moments of relaxation, have tried to learn about ego. My usual procedure for doing this is to think-a-thought about ego, any thought .Then as though someone up there, desperately wants me to think about it,I suddenly and surely get a second thought to jump onto and then its not too much time before I am really sinking in the process of learning about Ego. But thinking can not make you learn the whole concept, just like learning theory about, say operating a computer, cannot teach you to operate one. So, you need to take lessons from life, the rude way in which she teaches- by giving the test first. The thinking only helps to be aware about the oncoming test.
Every time I think something I fail to document it. So eventually it evaporates. So this time, here I am, writing what I feel is the crux of my last such thinking session. It started with—everybody has (an) Ego (whatever it may be).How do we know it? Because we associate a boundary inside which we call our SELF and we have a definite sense of our limits and so also of our outside. So ego is like a rubber balloon rather than an atom’s nucleus. It is the boundary that is the Ego. The feeling of having a centre about which this boundary must be, is a derived and secondary concept. Obviously it is not the postulate.
What seems interesting here is that our ego is not, only because we have definite limits of ourselves but because we have definite limits of others. We know that a certain man is 5ft 11inches (the physical limit of the form) and that he cannot jump beyond 3 metres (the physical limit on ability).So we move around having a picture of the world as many balloons here and there. For most of them we have names. Some are less important to have different names so we unite them under similar looking and call them by a specific group name.
This idea becomes more interesting and complicated when we find that not only these balloons are intersecting sometimes but that when we group other balloons we make another balloon containing all them. To make the point clear ,say I know a thousand human beings by first name and, for some of them, their boundaries are very clearly defined for me, because I know them better.For others this boundary is rather fuzzy. Now I form a big balloon and call it humans. This balloon contains people because they look like other members of the balloon and because they share common limits. Now if we suddenly see a man do something out of his limits, we either extend the balloon for humans to incorporate this achievement or we cast him aside and make another balloon for him.
Now the things get interesting when we place our own balloon with other balloons. For some balloons we define that we are in them, for some we decide we don’t want to be in them. Others we don’t mind. These definitions make our character, help us in deciding our actions and strengthen our sense of ego. So my point is, is only our own balloon our ego, or is the system of things in which we are placing ourselves also a part of our ego?
I consider myself as an identity and so I have an ego. But then again a group of people like me who happen to be born in the same place, belong first to a city, then to a state and then to a nation. Like the balloons in the balloons.
Now every city has its ego. The supporters in an intercity match of cricket or for that matter an inter-colony match, an international match, the wars, the inter company rivalries, the inter university sledging, the gang wars, the religious clashes trying to establish that my ideas are better than yours, that my limits are bigger than yours, that my balloon is bigger than yours, prove that even a group of people having similar limits or egos, have a common ego.
So going by the old picture of the ego as being the center of an identity, where do we place this ego of a nation? this ego of religion? So this is the new picture of a multilayered ego. That makes it easier to see and hence easier to get free from.
Thinking about getting free from Ego, will this multilayered ego be easier to escape from than the older one? Will it be difficult to get out of the well because we think that it is deeper now with all the layers over it, or will it be easier because we have made comfortable steps to get out of it, one step at a time, one layer at a time?
We are having these questions because we are still not ready to leave our older idea of the Ego. There is no one who needs to get out of the well. No one needs to climb the steps. When we understand what is written above, we realize that Ego is more like a multilayered onion. Start peeling the layers and we realize that at the end there is no onion.