Your Island in 2008 and Beyond

If you must forecast, forecast often.

Paul A. Samuelson

This is what the tea leaves are saying.

Somebody else will celebrate Halloween at Reduit

SAJ will not get a second term as President because it doesn’t make any sense for Navin Ramgoolam to reappoint him as the MMM and the MSM will most likely go together in the 2010 polls. Indeed the leaders of these two parties will somehow try to convince us as from mid-2009 that our future lies with what they will dub as Federation III. As usual, it is their future that they would be talking about as that’s the only political combination that will allow them to hold the most important office of the land, albeit for about 2½ years each. Of course if you don’t vote for Berenger as PM, you could, again, be accused of being a racist.

Berenger not likely to go first in 2010

Berenger has always lost general elections when he has presented himself as either the only candidate to the post of PM or the first in a power-sharing agreement. This of course lends some credibility to the view that a chunk of the electorate in 2000 thought that SAJ would somehow not have handed power to the Leader of the MMM in 2003. Anyway, a safer bet for Jugnauth Jr. and Berenger would be for the latter to become PM in the second half of the next term.

Meet TAMBO

Patriotism is the last refuge of the scoundrel.

Samuel Johnson, 1775

It stands for There-Are-Much-Better-Options. It’s the response of The Jag! on behalf of the beautiful people of Mauritius to the incompetent bunch that swear only by TINA.[1]

TINA – Position #1: There is no money to fix the severe traffic problems that we face. Debt levels are already way too high. Blah blah blah.

TAMBO – Response #1: It is really not a problem if national debt levels went up a little bit as long we’re using the money to solve real problems. For instance cutting ½ an hour on travelling time every working day for tens of thousands of Mauritians that take the Curepipe-Port-Louis corridor is one area where our tax rupees should go to in priority. Hey, if you have an excellent Public Transportation System that runs till late every day a great number of people will start leaving their cars at home. Spending money in this manner will not only make us more competitive but it will make every square inch of our island more valuable. Another way of looking at it is to realise that standards of living can be raised by reducing the multiple levels of frustration that we face as citizens of our island-state. Of course, we would have to be worried if debt levels were going up and the money were wasted or mysteriously disappearing or if debt levels were going down but new levels of frustration were cropping up. If you are solving problems that really matter both debt levels and frustration levels will eventually go down.

TINA – Position #2: The only priority is deficit and debt reduction. So in his 2006 budget the Minister of Finance decided among other half-baked policies that the school-feeding program was a waste of money, the subsidy on rice and flour would be eliminated, interest income would soon be taxed, personal income tax exemptions would be abolished and the HSC/SC subsidy would be reviewed.

TAMBO – Response #2: The basic practice of government or anything else for that matter requires that we understand the important links of the system we are trying to improve. That is which dots we should connect and how we should connect them. Ignoring the basic principle that understanding how things work is to have control over them, Sithanen managed to seriously upset the whole country for a mere 0.2% difference in the deficit of his first budget. We all remember how Berenger had to apologize for Sam Lauthan’s blunder with respect to means-testing our elder folks. Well, what Sithanen has done is at least 10 times worse and the political cost of such incompetence will be borne by everybody’s favourite uncle, Navin Ramgoolam, who unlike his Finance Minister needs more than 24 hours to shift parties.

TINA – Position #3: Sugar Industry is our mother industry [paragraph 73, Budget speech 2007-2008]

TAMBO – Response #3: If that’s the case then I guess we shouldn’t be surprised to see Rama Sithanen come across a Dodo on La Chaussee Street and greet her with a heart-breaking ‘chachi’. It was totally indecent for the bean-counter to have suggested that we should handout Rs 5 billion to that sunset industry especially after making us poorer by depreciating the rupee and viciously going after our hard-earned savings. That was after he announced another economic nonsense on TV from Brussels that the money we would get from EU would be used to subsidise loans to that sector. Sithanen owes us an explanation as to how he moved from subsidised loans to outright gifts. We could definitely use that money much more productively. Our salvation lies in shortening our product and industry life cycles, not in making them last forever. And that’s a good prism through which to look at the Tianli project.

TINA – Position #4: The country never faced such economic upheaval before. Triple External blah blah blah.

TAMBO – Response #4: When you don’t know how to solve problems you just blurt out crap or you go seek help from the Bretton Wood idiots (The IMF and the WB). Sithanen not only does both, he also imagines new problems now and then when he is not creating some really serious structural ones. Meade and Naipaul rightly did not think much of our future when they said what they said after seeing what they saw: rapidly-expanding population, mono-crop economy, the tyranny of distance and a century and a half of divide and rule complimentary of the British on the coat-tail of about a hundred years of French rule which saw the execution of a particularly cruel version of Colbert’s little human resource manual, Le Code Noir. All of this along with the first two oil-shocks surely did not predispose us to the sunniest of tomorrows. But thanks to the vision, dedication and the very hard work of a few mavericks we managed to hold our heads above water and a strong foundation for our country was laid. Regrettably, the latter was left to rot after 1982. It is also interesting to note that the implementation of free education turned 30 last January. At that time, and fortunately for us, doing was not the same as deciding and of course when a Minister resigned, he resigned.

TINA – Position #5: The Minister of Finance does not have a forecast for inflation. That was after the rate of inflation (both the CPI and Core inflation) doubled in a 12 month period mostly on account of budget-related measures and the practice of Faratanomics. There is nothing we can do about rising prices.

TAMBO – Response #5: In the country where both Sithanen and Mansoor studied economics, the law requires the Governor of the Bank of England to write an open letter to the Finance Minister if the target rate of inflation of 2% is missed by more than 1% on either side. That happened last April for the first time in 10 years since the UK’s Monetary Policy Committee was set up in 1997. That letter is a must read to understand why there is no place for Sithanen in the cabinet and that’s before you realise that he is contravening Article 5.2a of the Bank of Mauritius Act 2004. The British rate of inflation has since then been brought back to within target.
TINA – Position #6: The reform is working (a.k.a early harvest). We have to maintain the course. Blah blah blah.

TAMBO – Response #6: At double-digit inflation with double-digit and rising unemployment along with a depreciated currency, entrenched inflationary expectations, a really upset population and not the least sense of direction I don’t think we could call that reform. Nope. What Sithanen has been doing for the past 2¼ years is nothing but screwing up our country big time. Clearly this is a case of things gone worse right from the start before really and rapidly getting out of hand.

TINA – Position #7: Our rupee is overvalued and has not adjusted for the past few years. Rupee is then devalued.

TAMBO – Response #7: Not knowing what to do, our Finance Minister simply followed a flawed IMF report that found our currency overvalued and made everybody, save a few speculators, poorer. This is all the more controversial given that the IMF has come under attack with respect to its core function: exchange rate advice. Indeed its own Independent Evaluation Office (check the May 17 report) has found the type of advice it has been dishing out wanting at best. And matters have gotten more complicated for the IMF: nobody wants to borrow money from it and nobody wants its poisonous medicine. Furthermore, given all the FDI Sithanen said we have received, that would make Mauritius probably the only country to have experienced what needs to be coined as the Reverse Dutch Disease: the more FDI you receive, the more your currency depreciate.

TINA – Position #8: We’re gonna revolutionize the tax system. Exemptions are going to disappear. Youpi!

TAMBO – Response #8: A lot of people (that includes people who will vote in riding no. 18 in 2010) feel that they have been cheated by the crappy policies of Rama Sithanen. Indeed, when people take loans, insurance policies and craft their investment policies they plan over the long term using their frontal lobe machinery. A responsible government doesn’t make these decisions become irrelevant in one bean-counting budget-speech especially if that’s what another flawed IMF report recommended. Maybe that’s what he meant by early harvest: the population have been harvested of their assets. And the doubling of the rate of inflation and depreciation of the rupee also creates a distortion known as shoe-leather costs: you waste your time into unproductive activities because the environment has become unpredictable. Isn’t that what is precisely happening in our country today? Paul Krugman’s September 10 piece in the New York Times entitled Where is my trickle? makes good reading for those who have mistaken Mauritius for Mount Meru.

A little aside on expectations
Lucas. Not George. Robert E. There was picture of him smiling and holding a bottle of Dom Perignon in the newspapers some 12 years ago. He had every reason to celebrate. He had just been informed by the Royal Swedish Academy of Sciences that he had been awarded the Nobel Prize in Economics mostly for ground-breaking work that he did in his early thirties. So important was this work that some new artillery in econometrics had to be crafted to implement it. And his 1976 critique of models that did not allow expectations and hence behaviour of economic agents to change was so brilliant that it ended up simply being known as the Lucas Critique.

Updating
Essentially, Lucas explained that people process information efficiently (the equivalent in financial markets would of course be Gene Fama’s Efficient Market Hypothesis). That is they update their prior knowledge with new information. They revise their expectations in such a way that they end up having rational expectations – a term coined by John Muth in a paper published in Econometrica when Ali Mansoor was about 5 years old. This is a crucially important concept for policy makers when trying to assess how agents are going to react either following the announcement and/or implementation of a new measure or as the environment evolves. What’s going here is a much more sophisticated version than what B.F. Skinner discovered rats were capable of when subjected to an external stimulus. This is something that is continuously ignored by Sithanen.

TINA – Position #9: Setting the stage for robust growth.

TAMBO – Response #9: Economic growth is obtained by multiplying the growth rate of a sector by its size and then adding everything up. Sugar is a smaller sector than the financial industry and has experienced a natural death while the financial sector has been growing at a brisk pace and can grow at even faster rates. But it is not surprising that so far Rama Sithanen has had little plans for that growth sector except maybe playing some really cheap politics with our national debt numbers. Furthermore it is a well established fact in Economics that taxing interest income will slow down the growth rate (known as the Lucas wedge). Does it look like we are going to get robust growth? And that’s supposed to happen without enhancing our infrastructure? Wow!

TINA – Position #10: We’ve been victim of our own success. We need cheap loans from the Bretton Woods Institutions and the AFD has been brought back in after they’ve been shown our begging-bowls.

TAMBO – Response #10: Mauritius is not desperate for cash to finance its development. There is absolutely no reason for us to borrow money with strings attached be it from the World Bank or the China Development Bank. The Government can borrow money from our local capital markets like it does regularly or it may borrow from international markets at a rate that reflects our credit-worthiness which in turn depends on the way we manage our country. What we urgently need to do is to allocate money to solve one major problem after the other. What we don’t need is money that cannot be used to solve real problems or getting our heads buried in the sand and waiting for these problems to somewhat go away. Also, why pay interest to foreign institutions when that interest could be used to support the deepening of our capital markets which will create more high-paying jobs here? There’s another proof that Sithanen is creating severe structural problems for our country.

A concluding note
I am betting the Prime Minister will cancel the NRPT one way or another in the days to come in order to defuse one of elements of the perfect political storm that his Finance Minister has been brewing. This would have been just another big waste of our collective energy to clean up after the bean-counter.

TAMBO is here to stay
How big is this TAMBO thing going to be? Huge! Africa’s busiest airport has already been named after it!


Comments: density@intnet.mu.

[1] TINA stands for There Is No Alternative.


No. 8 September 2007
© Sanjay Jagatsingh, 2007

Trends in Central Banking

What is the Federal Reserve?
Of the US population
23% think it was an Indian reserve,
26% a wildlife preserve,
51% a brand of whiskey

Remarks of Chairman Miller in Peter Lynch’s One up on Wall Street

Dear readers of The Jag! This edition of the ‘newsletter with teeth’ features an article on central banking that was written around the end of March 1999. We are reproducing it in here as a background article for further analysis that will be featured in forthcoming editions. Happy reading and stay tuned!
__________________________________________________

Central Banks could probably have done without the Y2K problem. The 90s would already have been an unusually busy decade for many of them. Here is how.

Inflation targets, uncertainty and the Monetary Conditions Index
Early on in the decade, mounting deficits and ballooning debt levels in G-7 countries have forced central banks and governments there to opt for low inflation targets. Roughly, between 1% and 5% as captured by the CPI[1]. It’s not that it suddenly dawned upon them that interest payments were eating up 30 cents out of every tax dollar. No. It was more because of a wake up (and smell the coffee!) call from our friendly global capital markets telling them to either put their fiscal houses in order and adopt consistent monetary policies or face a massive sell off of their securities. Some like Canada have listened and have found many virtues to low inflation (which its Central Bankers are likely to have happily shared once a month with their colleagues in Basel, Switzerland) along what was to be a very bumpy road. The good news is that they will turn out a budget surplus this year from a deficit of CAD 42 billions in 1993. Finance Minister Paul Martin, a millionaire from Montreal and strong contender to succeed Jean Chretien as PM, will use part of the surplus to start paying off the national debt.

Why adopt low inflation targets?
First because it shields the purchasing power of pension benefits of a rising share of old folks. It also bolsters confidence in the currency. Next it allows economic agents to get their priorities right by focusing on productivity-enhancing vs. speculation activities like those experienced in Germany in the 30s. Collective bargaining is carried out in an environment of lower inflation uncertainty and is likely to lead to a lengthening of contract maturities. Lower inflation will also ensure lower borrowing costs via lower inflation premium and lower inflation variability (in a GARCH sense). Once inflation is tamed, rates should come down, increasing investments and the general standard of living.

Central banks have not only to reduce year-on-year changes in the CPI index but they also have to drive down expectations of inflation. And they have to do that throughout the whole business cycle. Low inflation credibility will not be sacrificed at the expense of averting an economic slowdown. Besides as Central Bankers have found out, it takes a while for credibility to show up in a markov-switching model (the new darling in central bank research).

How uncertainty can being reduced
By establishing price stability as a goal. The name of the game has been first a systematic reduction in the rate of inflation and the subsequent adoption of specific inflation targets. This is the approach adopted by the Reserve Bank of New Zealand. Once this is achieved, the Central Bank has to stay the course and possibly focus the public’s attention on its use of intermediate keyposts such as the Monetary Conditions Index (MCI) in gauging the stance of monetary policy. Central banks around the world have been making a greater effort to communicate policy actions and intentions through press releases, monetary policy reports, press conferences and of course via their websites.

The MCI
Pioneered by the Bank of Canada, the MCI is a tracking device that is correlated with the ultimate target such as aggregate demand while being sensitive to policy instruments. It is a combination of interest rates and an index of exchange rates that reflects the relative importance of these two channels of monetary policy in affecting nominal spending. A typical vector autoregression result is that interest rates are between 2 (New Zealand) to 3 (Canada) times more important than exchange rates. Which is good news for Central Banks as they have little influence over the exchange rate when their currencies float. The MCI has also found a place in the toolbox of the quantitative asset manager namely in the design of asset allocation models.

Problems with the CPI and the monetary aggregates
The recipe appears simple. Reduce the monetary ease and this will bring the CPI within the targeted band. The snag is that the CPI contains a measurement bias. Reasons advanced by Federal Reserve officials in their testimonies are that current inflation rates imply that there has not been any increase in productivity, the relevant baskets are slow to acknowledge technological advances that modify consumer behaviour and yield productivity gains. The Fed estimates that inflation is overstated by 1% to 1.5%. This makes the case for a positive rate of inflation. To complicate matters growth appears to be overstated by 0.5%. Solutions include the adoption of chain weighted indices, a subjective removal of the bias and developing better methodologies for measuring increases in the general level of prices.

Another show-stopper is that the link between M1 and nominal spending has weakened enough to prompt Feds to reduce its importance among the battery of indicators or abandon it altogether (US, Canada while the Bundesbank watched M3 in the pre-Euro setup). The idea is to identify broader monetary aggregates that provide good informational content of inflation 4-8 quarters hence as monetary policy operates with a lag.

Banking supervision and the management of reserves portfolios
Barings, Credit Lyonnais, Orange County, Daiwa and more recently LTCM. These are financial disasters that had the potential to torment bank regulators in their crusade of ensuring a healthy financial system. These events have since led to the establishment of capital adequacy standards with respect to market risks over and above those that have traditionally been required as a buffer against unpleasant credit risk surprises. But financial institutions have recently been given the option of utilizing their own risk management systems in determining the amount of capital to set aside for these risks. This is essentially because the risk management culture at some of the bigger and more innovative banks have been found to be more sophisticated than anything regulators could have asked for or imagined. One example is JP Morgan’ s 4:15 report that spits out their forecasted global market risk on a daily basis.

And Central Banks are integrating some of these ideas in the active management of the reserves portfolios. Gone are the days of passive management of short-dated instruments. Duration gap models are being replaced by value-at-risk[2] metrics coupled with stress simulations of aggregate market risks. They have found that drawing on the seminal work of Markowitz, Sharpe, Merton and the likes are not inconsistent with their basic objectives. Furthermore optionality at the security and portfolio level matters. And they too are worried that asset and default correlations tend to increase when they are needed most. In sum they want to make sure that the return earned (contribution to the national till) is enough for the level of risk assumed. You wouldn’t want it to be otherwise.

On independence
This is a concept espoused by the Bundesbank in 1924 when the relevant legislation was enacted. Since then Federal elections have been lost and won over the single issue of price stability. The relationship between independence and the inflation record of the Central Bank has been investigated too. The GMT index, a weighted sum of 15 legal provisions that includes the length of the governor’s contract and whether he is a government appointee, has been found to have good predictive value. We can only hope that country-rating agencies will factor this into their analysis of our island once they spot Mauritius on a world map that is.

Implications for the investor
Central banks can have an enormous influence on financial markets. Let us consider fixed-income markets. The Treasury yield curve is the benchmark for corporate debentures (bonds) everywhere in the world. Every corporate issue is priced off this curve as it is considered risk-free. In Mauritius, the curve extends out to a maturity of about two years thanks to the seven-hundred-and-something-day T-bill. Corporate debentures of similar effective maturity (which is the case of all but three debentures) should offer a higher yield than their Treasuries counterpart because of default risk, redemption risk, redemption behaviour, horizon risk and reduced liquidity that characterise these issues. The impact of tax-free interest income should likewise be taken into account. All these factors along with the availability of T-bills to the individual investor explain why corporate debentures appear to trade a bit more consistently with respect to government paper. A closer analysis is however required to find out where they are heading to. Empirical research in the US reveal that the influence of the Fed via the fed funds market on the Treasury yield curve is concentrated mostly at the shorter end, accounting for more than three quarters of the variability of changes in T-bill rates whereas it explains about one only third of the movements in 10-year bonds.

[1] Or core inflation. That is CPI without its volatile components such as food and energy components and indirect taxes. But inflation targets can be more sophisticated. Rules like a 3% annual increase in the monetary base with adjustments for the change in base velocity over the past four years plus for deviation of nominal GNP from target paths have been suggested.
[2] The US Securities and Exchange Commission now requires that all companies with a market capitalization of $2 billion and more (about 25% more than the market cap of the SEM at the time of writing) to disclose any material risk exposures.

Comments: density@intnet.mu.

No. 7 January 2007

© Sanjay Jagatsingh, 2007

4.2%

The measure of success is not whether you have a tough problem to deal with, but whether it is the same problem you had last year.

John Foster Dulles, Former US Secretary of State

Instead of the 4% that was announced on the day the last World Cup began. That’s what the budgetary deficit would have been if Rama Sithanen had kept the subsidies on rice and flour instead of subjecting us to yet another instalment of Faratanomics, his trademark rendition of the dismal science. For a mere 0.2% difference in that deficit and a string of incoherent measures he has managed to put Mauritius still a bit more out of focus since he was back in office for more than 1 full year now. Naturally the attendant political risks will be borne mostly by Navin Ramgoolam as Mr. Sithanen will always have the possibility of again jumping ship if push came to shove in 2010. Unless of course he tries to convince us that his name should appear on all party lists if ever our electoral system is modified to include a dose of proportional representation. You think that’s exaggerating a little bit? Well, hasn’t he already suggested on TV that the name of party leaders should find their way onto party lists?

Budget process needs to be reformed
Rama Sithanen took about 2½ hours to deliver his budget last June 9th. A lot of what he said then should have been left for the budgetary debates and shifted in one very handy document along the lines of the 310-page Economic and Fiscal Strategy Report and Financial Statement and Budget Report published by Her Majesty’s Treasury. This explains why Gordon Brown’s 2005 budget speech lasted only 45 minutes. The British authorities also publish a Pre-Budget report each December which contains an update on the economy and projections on the fiscal position of the government as well as describing the reforms that are being considered in the following budget. The UK budget and accompanying documents can be accessed here. There are a number of advantages of getting these documents out. The most important one is that it will make a lot of people (this includes analysts at rating agencies) save time by having access to information they need to do their jobs in a handy format which will leave more time to raise the level of debate about economic policies in our country.

Doing things differently
Nobody can argue with the fact that we need to put our fiscal house in order. But probably where a large majority of Mauritians totally disagree with our Finance Minister is the way he’s been going about it. Our Finance Minister wants us to believe that things are really bad out there. So bad, that he has passed up the opportunity of presenting an additional full budget when he produced the half-baked statement that he delivered back in August 2005. He wants us to believe that Adam Smith got it totally wrong and that there is no such thing as an invisible hand. No. There is in its stead something extremely vicious lurking out there: some kind of Bolom Loulou.

A new disease has appeared…

So you need a new prescription and you better follow the doctor’s advice scrupulously, right? Not necessarily. The doctor may have come up with the wrong diagnosis and it would make perfect sense to, at least, seek a second opinion before swallowing in the recommended medicine. In fact, it is clear that the way Rama Sithanen has been managing the economy for the past 15 months is the equivalent of gross medical malpractice. And Navin Ramgoolam as the boss of the ‘medical institution’ should already have done the needful to have Mr. Sithanen seated next to Ashock Jugnauth in the Legislative Assembly because his Finance Minister has misread the situation and has proposed half-baked policy responses.

Misreading the situation
The triple external shock argument
As detailed in the previous edition of this newsletter this argument does not hold any water as recent events have started to confirm. The economic konnetou of the current government has simply confused shock for consolidation in the textile sector. As regards to oil, ask yourself the following question: Does the higher price of oil impact negatively on our budget deficit? Not really because when oil imports shoot up from Rs 11 billion to Rs 17 billion as they’ve done over a recent 12 months period, the government collects an additional billion rupees in VAT receipts. Besides, with the automatic pricing mechanism all of the price increase is passed on to us. For the good of the country, but only if he will stay on as Finance Minister for the next little while, Mr Sithanen should immediately be sent to business school to get some management theory under his belt and provided with a copy of the speech of David Walton, Has oil lost the capacity to shock?[1]

The World owes us a living
Mr. Sithanen wants loans that we don’t qualify for from the World Bank and elsewhere. The pathetic excuse used is that of Mauritius being penalized for its past successes. The AFD (Agence Française de Développement) which closed its local offices many years back when we had migrated into the group of middle-income countries has been begged back into Mauritius. Is the UNHCR going to be called in next year?

Growth and unemployment
According to the somewhat convoluted chain of logic of Rama Sithanen, we need 8% growth otherwise jobs may not be created and we will end up with one of his favourite terms: jobless growth. Well, not if you make job creation the focus of your action. We should go for policies that work in practice irrespective of whether they work in theory.

Treaty risk
Mr. Sithanen misreads the Financial Sector as consisting essentially of the offshore sector. There was nothing for Capital Markets in his statement a year ago. Effectively nothing in his recent budget either. And because of this misreading the treaty risk that we face in the offshore sector becomes much larger than it ought to. Hey, but don’t worry. We’ve already sent him along with Minister Boolell abroad with large begging bowls, haven’t we? We really don’t need better management, right? All we need are cheap loans.

Some of the half-baked policy responses
School-feeding program
Who came up with the really smart idea of cancelling this program? Doesn’t that look like one of the typical stinking recommendations on which the International Monetary Fund / World Bank (IMF/WB) has built part of their reputation on? It’s a good thing that the same person(s) back-pedalled.

Subsidy on SC and HSC fees
The targeting of that subsidy has surprised even some of the closest Sithanen supporters. It may unfortunately exclude people who are moonlighting to make ends meet. What an irony when you consider the role that education has played in the life of Hon. Sithanen in getting him to where he is today.

Pension reform: Is Otto back?
Simply extending retirement age by 5 years is like having Chancellor Von Bismarck back to adjust his Ponzi scheme. When are we going to consider better organisational design and paradigmatic shifts? Maybe we are planning to spend another Rs 100 million to have NTan back in a few years when and if another Rs 1 billion is recycled in a parallel conduit?

National Residential Property Tax
Doesn’t it look like a half-pregnant policy to you?

Forex deposits become more attractive
Exports down, imports up. Currency under pressure. What did you expect from the budget? Surprisingly, it made going for foreign currency deposits the reasonable decision. Afterwards, you hear your Finance Minister imploring people to convert their foreign currency positions into rupees. Hmm. That must be the new model he’s talking about. Glory to thee.

Better Options
We could have done better since July 2005 if things had been done differently. Here are a few examples.

There was no need to cry wolf
Rising oil prices surely affect us. But they affect other countries that are not oil-producing too. What we instead expected from our Finance Minister was an intelligent pronouncement as to how we were going to produce each unit of GDP with less oil. In the final analysis, our competitive position could even be improved if our response was smarter than other countries that compete in the same products and markets as we do.

Removal of subsidies on rice and flour
If he couldn’t think of anything better he could have spread this new policy measure over 2-3 years or leave the one on flour because of its cascading effects. This would have given time to the population to adjust and for officials to get the implementation right and would have salvaged the credibility of our monetary policy – whatever remains of it.

Everything is related
Economics cannot be practised in a vacuum. We are being held back by our education system, poor English-speaking skills, quantity and quality of our infrastructure and our leisure policy to name just a few. In India, for instance, the Finance Minister recently estimated that about 200 basis points (2%) are shaved off the annual growth rate because of inadequate infrastructure.

Do not create uncertainty
There is a good deal of uncertainty hanging over our country and a non-negligible part of that sinking feeling can be traced back to the application of Faratanomics by our Finance Minister. More on this below. And the inflation rate is going to exceed the target rate set by the Bank of Mauritius by a significant margin while core inflation is on the rise.
Who likes uncertainty? Rating agencies, for one, don’t. Credible Central Banks neither. Target 2.0 is a publication of the Bank of England named after the targeted rate of inflation that the Old Lady has set to herself. A number of central banks worthy of that name have adopted similar targets: The Federal Reserve and The Bank of Canada. Voters in Belle-Rose/Quatre-Bornes may also wish to learn that in Germany, federal elections, in the past, have been lost over the single issue of the rate of inflation.

How to create uncertainty in 3 easy steps
Start misreading the current situation and remain concentrated so that you misread the past too. Come up with a silly argument such as Triple External Shocks that will speak directly to the spines of the people. Don’t mention Bolom Loulou, at least not in the beginning. And forget that we are a sovereign country.
Get a university buddy who is at least as confused as you are as Financial Secretary. It’s really not a problem if he lives on another planet. It’s even better if he promises to do IMF/WB experiments here. That shouldn’t make it too difficult to make sure this appointment is heralded as another bold move in the history of humanity after man set foot on the moon.
Get another friend as adviser. This friend should ideally be a high-school physics teacher so that he will explain how Newtonian physics can confirm that the first buddy is indeed from outer space and consequently why you shouldn’t expect more cohesion from fellow majority MPs. He may even use cloud dynamics to help your vision stay, uh…, clouded.

Come and do business
That’s the tag line for the world tour that our Finance Minister has been embarking on for the past little while to woo investors into our Motherland. I wonder who is responsible to blurt out such a low-quality tagline although I do remember Rama Sithanen stating a year ago that he would be seeking the help of the World Bank for branding Mauritius.[2] But that will not prevent J. Walter Thomson from turning in his grave. Where can we buy a DVD of these trips to find out what exactly he’s been saying and doing? And who is listening to him?

Attracting talent
We already have more than enough talent here to solve most of our problems. The problem is that a lot of our brains are either planning to move out or are not returning. Before you talk of attracting talent you should first stem the brain drain.
In the financial services sector, for instance, I estimate that about 60 CFA Charterholders could be employed in these following three areas: the Debt Management Unit of the Ministry of Finance, The National Pension Fund (with an appropriate organisational makeup) and the Bank of Mauritius (including managing the country’s reserves portfolios instead of getting the BIS – a club of central banks – to do it for us). This should already have been done back in 1991 if Mr. Sithanen had adopted some of the international best practices the first time he was Finance Minister.
Once you’ve done this kind of basic stuff you may try to see how you compare with Singapore in the stem-cell research race.

Comments: density@intnet.mu.

[1] This speech was delivered on February 23, 2006. Sadly enough, David Walton passed away last June 21 at the age of 43. He was a member of the Monetary Policy Committee of the Bank of England.
[2] Maybe it is inspired from the name of that World Bank ranking called Doing Business. Doing business, Come and do business. You get it? I don’t either.

No. 6 November 2006

© Sanjay Jagatsingh, 2006

The Fallacy of the Triple External Shocks Argument

In science one tries to tell people, in such a way as to be understood by everyone, something that no one ever knew before. But in poetry, it’s the exact opposite.

Paul Dirac

Because most stars are so far away, their light has yet to reach Earth.

Edgar Allan Poe solving Olber’s Paradox in a poem

I don’t know about you but me, I have had an overdose of the so-called Triple External Shocks argument brought forward and used ad nauseam by Rama Sithanen for many months now to paint a very dark picture of our economy. The main problem with this argument is that it stands on shaky grounds at best. Let me tell you why.

1st shock: Price of sugar to fall by 5% this year and up to 36% within a few years
We knew that this was coming for a long time so that there is no element of surprise or shock here. We have been growing sugar for 300 years now and it’s been the commodity that has financed the development of other pillars of our economy – under that famous protocol – which incidentally have now dwarfed the sugar sector itself. Paradoxically, Le Grand Argentier has perhaps failed to realise that by recently announcing that the seafood hub would double in size in a few years’ time it will be yet another sector to dwarf King Sugar.
The share of sugar in the economy will inexorably keep on shrinking from its current 5%. This looks like a textbook example of the Product Life Cycle at work – you can only produce something for a given amount of time before you are outgunned by entrants with a lower cost structure than yours. Yes, the economics of the cane industry looks better than that of the sugar industry but we need to look even beyond. And this year’s price cut of 5% shouldn’t have taken so much of our Finance Minister’s saliva. The €URO has also been surging ahead this year, hasn’t it? Naturally, we should see it to it that we are treated fairly by the European Union.

Michelle

Holy Writ was intended to teach men how to go to Heaven, not how the heavens go.

Galileo Galilei

She went through her late dad’s stuff and assembled an interesting collection of his correspondence into a book with the help of Timothy Ferris. On skimming through it you will learn about how he used to help with her homework including an account of a discussion he had with one of her teachers. Keep on reading and you find out that Michelle’s dad was a member of the California Curriculum Commission. Is the story becoming more interesting? If it’s not, it surely will when I tell you his name: Richard Feynman, considered as one of the 20th century’s most innovative physicists.

According to the ranking compiled by Shanghai’s Jiao Tong University, California was home to 6 of the world’s 20 top universities in 2005 and half of the world’s top 6 (Stanford, ‘The Republic of Berkeley’ and CalTech). In fact apart from Oxbridge there was only one other university that made it in the top 20 that was not from America: Tokyo University.

They want Sam
A little luck or research will reveal that one of the schools that are sending students on a massive scale to those temples of learning is none other than Singapore’s Raffle Junior College. In 2004, it sent more than 300 students to top US universities with about 160 attending Ivy League schools. The government foots the bill for those who sign a 6-year bond to come and work for a government-controlled organization – that’s ½ of those going to America. I suppose you don’t drag your feet too much when you have to go to work for Temasek (that would be Singapore’s equivalent of our State Investment Corporation) after your graduate.

Compared to us, Singapore adopts a more competitive approach to education. There is an extra streaming step after 4 years of secondary education. And that’s not all. They attract talent from other countries in the region to their high schools by offering scholarships to those brilliant kids so that the smartest Singaporeans are in the company of an international cream of the crop. [1]

Marx would have lost it
Obeegadoo’s reform which mistook symptoms for causes adopted a coercive approach to try to prevent households from adapting to the shortage of quality secondary schools in a perfectly rational fashion. Besides, one should not forget that, after all, Obeegadoo’s ‘regionalisation’ is basically a new algorithm for allocating seats – one whose adverse effects could have been analysed in a spreadsheet or simulation model BEFORE its actual implementation.[2] The May 2001 report could probably have been entitled ‘Please bear with us while we gamble with your most precious asset!’

The trade-off households embrace
Mauritian parents are ready to have their kids travel a number of extra kilometres for a better secondary school and several thousand kilometres to attend a good university.[3] Why is that? Well, because they have rightly understood that university education is the Royal Route (Route Royale is something else) to landing a good job in our knowledge-based world and this can possibly happen via a state scholarship to a good university overseas. This is particularly true for the QEC: Obeegadoo’s report mentioned that the 143 seats there were filled by candidates ranked between 1 and 150. That makes perfect sense for anybody who is not a pseudo-marxist for two reasons. The first one is given that in some years the QEC has 12 laureates that works out to about a probability of getting a scholarship of a little over 8% for anybody gaining admittance in Form I there. These are amazingly good odds for snatching a free ticket to a good university if you ask me. The second reason is that it is absolutely normal for kids to want to evolve among peers of equal ability. Talent attracts talent and bean-counters flock together with surprising speed.

School choice
Quality of school is then the most important factor. But parents are also reasonable. They wouldn’t mind sending their kids to the neighbourhood school provided it is of an acceptable quality. With that in mind, they should be provided with more information, in a standardised format, about all the island’s secondary schools. And that should be available via the web.[4] In effect, we should come up with comprehensive descriptors of school quality (pass rate at SC and HSC levels, number of laureates if any, accomplishments in sports, amenities, etc) including a ranking of those schools that would be updated every year. Many households would then decide, for example, whether it is worth for their son or daughter to travel 5 additional kilometres to attend a school that has a HSC pass rate that’s 2% higher than the school next door.[5]

Cleaning up the mess
Minister Gokhool’s introduction of the National College is a step in the right direction and has necessitated the introduction of the A+ grade which gets us closer to the most meritocratic and transparent scheme for the allocation of seats in secondary schools: ranking. It surely is a much better criteria than skin colour, religion, straightness of hair, size of wallet or a combination thereof, right? And I hope that Dharam Gokhool does rapidly away with the retrograde approach for admission to the regional schools namely the combination of grade aggregate and residence. The problem with the grade aggregate is that it is not an unambiguous metric of performance as GPA (grade point average) or ranking are while the criteria of residence clearly tilts the scales in favour of the well-to-do.

What the CPE ranking is, really
It determines what secondary school you get into. That’s all. A better ranking definitely doesn’t mean that you will be ahead of or behind your peers throughout your whole adult life. Neither does the fact of winning a state scholarship a few years later.

CPE failure rate is ultimately a policy decision
When you have a CPE failure rate higher than 30% a number of possible reasons for such an unacceptable situation crosses your mind: the exams are too tough, a third of our kids are dumb, some teachers are not doing their jobs properly, etc. I don’t think that our children are dumb. I rather think that the exams are probably too tough and that some teachers are either unable or unwilling to teach properly. Add to that the fact that some manuals don’t even have an index! That really helps parents to get involved, eh?

What’s more troubling is that apparently a large number of students coming out of primary school don’t even know how to read. How can that possibly be? For sure, some of our kids need special attention and I sincerely hope that we are being inspired by what other countries are doing or have done in that domain.[6]

For one, the American ‘No Child Left Behind’ policy has reduced the time spent on subjects other than math and reading for some of the lowest performing schools. In some schools, children do only these two subjects and physical education until such time that they are ready to go back into the mainstream through some kind of standardized testing procedure.

The proportion of our kids that join the academic track should be determined by the pool of skills we need to ensure the kind of competitive advantage that works for a maximum of our citizens. Maybe not more than 5% to 10% of primary school-leavers should go into vocational schools. Let's hear what the data has to say. This is something we could have done before going to the polls this year if we had thought harder during the past few years. Or is it decades?[7]

The school system of today and tomorrow
It is important to note that 9/10 of every scientist who ever lived is alive today which partly explains why codified knowledge is expanding at an exponential rate. This should cause us to reassess the relative importance of the 3 or 4 major knowledge-acquisition techniques that are known to humanity.

Our education system should also have a great deal of flexibility to allow many opportunities for our citizens to increase their human capital throughout their lives. That should include ample options to change streams or to add skills from either one. Also, that system should make getting an university degree as easy as buying a soap.

We also need one or more mega-universities in the next couple of years and the provision of adequate financing and scholarships to students.[8]

The easy access to quality tertiary education in adequate quantity will have a positive effect on the behaviour of parents at the primary and secondary level. I bet you that they would then see a much smaller need for private tuition and instead load on extra-curricular activities which the system would have to provide on a much larger scale.

Oh yeah, one very bizarre characteristic of our current set-up is that girls and boys are always together from kindergarten to university except at the secondary level. Is there a good reason for that? I don’t think so.

The gross tertiary enrolment ratio can also be boosted by allowing SC holders aged 23+ to get university education as mature students once they get through a couple of math classes delivered in the evening in a number of our secondary schools.

Furthermore, we should participate in major international surveys of student performance like OECD’s PISA (Programme for International Student Assessment) and other prestigious competitions.[9]

Education policy, just like any other policy for that matter, should be backed by solid research. Our CSO, MES, MRC should be beefed up with all the necessary tools to improve the measurement of the drivers of economic well-being and their findings should be widely disseminated.[10]

For most of us, probably the last time we started to learn our third or fourth language we were about 5-6 years old. This paradox should be corrected given that we will live to 80 or more years. Our extraordinary ability to take up at least a couple of additional foreign languages remains pretty much unexploited.

Last but not least, we should place a premium on the importance of great teachers. Of all the awards that Richard Feynman won (that includes a Nobel), the one he treasured most was the Oersted Medal for Teaching.

Comments, as usual, are welcomed at density@intnet.mu.

[1] See The Wall Street Journal, May 6, 2004.
[2] The electoral reform debate about proportional representation should also go through a similar analysis.
[3] Last July, the ex-rector of RCPL, J. Gopaul, reported that in the 90s he had noted that more than 25% of the 900 students in his college came from rural areas especially from the north of the island. And God forbid no Mauritian parent finds out about a university in some distant galaxy.
[4] That should become even easier with the project to be headed by Dr. Appu Kuttan.
[5] Given that we’ve been so great at planning things in our country over the last quarter of a century or so the trade-off is in fact between quality of school and travelling time. It can only be hoped that the purchase of specialised transportation software authorised in one of the very first cabinet meetings of the current government has already yielded solutions that will be implemented Godspeed.
[6] It is interesting to note that special needs are also recognised at the tertiary level elsewhere. Indeed, some universities like McGill University have an Office for Students with Disabilities which make sure that such students get as much as twice the time indicated on their exams to complete them.
[7] It would be interesting to enlist the help of psychometricians and unbiased psychologists to have another angle on how the difficulty level of the CPE exams has varied over its history.
[8] These student loans could be subsidised by government.
[9] The next PISA survey is in 2009. We better not miss it.
[10] The computers of the MES have barely told us what they know.

No. 4 April 2006

© Sanjay Jagatsingh, 2006

Waiting For Rama?

If you can’t stand the heat, get out of the kitchen.

Harry Truman

Of course not. He has already shown his mettle and it is not difficult to see that he has a strong action bias and has uplifted what has otherwise always been a dull ministry. I am, of course, speaking of Rama Valayden.
The story with the other Rama, the one everybody was waiting for is entirely different. One of the most important ministries in the government – remember that the Ministry for Financial Services has also been merged with the Ministry of Finance – is close to becoming invisible after having gone to sleep for the past couple of months.

This is all surprising for a lot of people because the job of Minister of Finance is the only reason why Mr. Sithanen is in politics. We also remember how he switched sides overnight in September 2000 when he found out that he would not be part of ‘l’àccord à l’Israélienne’ or the so-called Medpoint accord.

And at least one person has regretted the absence of Mr. Sithanen from national decision-making quarters for more than a decade. The same people would also have us believe that Mr. Sithanen is among that small group of people who share a few other characteristics that are so godly that future generations of the beautiful people of Mauritius would be immensely grateful if members of that group would donate a chunk of their DNA in the hope that modern medical science would able to get a clone up and running after the day they get transformed into blue energy. It is not clear, however, if their egos should be sent to Harvard for study in the meantime. So much for Antoine St Exupery’s notion of ‘Murdered Mozarts’.

So you would have thought that the new Finance Minister would have come out of the starting blocks with a bang and with an urgent desire to sink his teeth into something meaty right away. Nothing of the sort really happened.

Tell us something we don’t know!
I don’t mean to say that Mr. Sithanen has been absolutely quiet. Far from it. The problem is that for the past 5 months only one clear message has been repeated ad nauseam – we are in a bigger mess than we thought we were (that’s his insider’s view). And he even marked an unnecessary pause for discussing the content of the Article IV Consultation which unsurprisingly added nothing new to public knowledge. We should also not forget that for the last 10 years he was out of Parliament, Rama Sithanen never missed an opportunity of painting a very gloomy picture of the economy often with his darling of ‘la méthode des quatre quarts’.

And who is interested in being constantly reminded what the previous government did or did not do? Didn’t the people already express their opinion on the overall management of the affairs of Mauritius between September 2000 and July 2005 and on Phase II of the Medpoint Accord? Rama Sithanen should instead tell us what he intends to do given that he is now in the driver’s seat.[1] A to-do list with deadlines and outcome measures is a good place to start.

Switch Ramas?
Maybe Mr. Sithanen is more interested with Electoral Reform and the Constitution? Or maybe he simply doesn’t have a clue of how to get us out of the small mess in which we are? In either case, the kitchen is not a good place for Mr. Sithanen to stay in. I suggest he moves to the living room, grab a good book on comparative analysis of electoral systems and relax comfortably in an armchair. Although, we have to note that it is with our current electoral system that we managed to prove Meade wrong.

In the meantime, the Prime Minister should proceed with a reshuffle. I personally think Mr. Valayden would very likely make a far better Minister of Finance as his energy level compares very favourably with that of Rama Sithanen and he understands that deciding is not doing – implementation is everything. There is, of course, another very strong contender for the top finance job in the cabinet: Navin Ramgoolam himself!

A recipe for doing almost nothing.
That’s what emerging from the performance of Mr. Sithanen since his return to his favourite manifestation last July. Write a little statement (a high-school-level essay) about what to do to set the stage for robust growth; brand it in a silly package such as ‘insider view’; appear really full of anguish on national TV and then go into hiding; sporadically come out to say ‘see, the World Bank too thinks we’re in a mess’ or ‘Moody’s confirms what I’ve been saying all along’. The latest ingredient is to hire someone from the World Bank (WB) as Financial Secretary who promises to be an ‘action man…’ for World Bank orthodox policies.[2] Time, of course, has not been waiting for Rama Sithanen: in a couple of weeks, six months or a full 10% of this government’s mandate would have elapsed.

Two questions.
Given that Mr. Sithanen is about to embrace the folly of WB Mantras it is most fitting to ask him a couple of questions.

Q1. What percentage of the success of a country like Singapore can be attributed to World Bank Policies and what percentage can be attributed to a visionary leader?
Q2. Is the story different for Dubai, the United States of America and other successful countries?

Until we hear his answer, let us deeply meditate on an alternative recipe:

In a different world we need to find a niche for ourselves, little corners where in spite of our small size we can perform a role which will be useful to the world. To do that, you will need people at the top, decision-makers who have got foresight, good minds, who are open to ideas, who can seize opportunities like we did. My job really was to find my successors. I found them, they are there; their job is to find their successors. So there must be this continuous renewal of talented, dedicated, honest, able people who will do things not for themselves but for their people and for their country. If they can do that, they will carry on for another one generation and so it goes on. The moment that breaks, it's gone. The World Bank report's conclusions are part of the culture of America and, by extension, of international institutions. It had to present its findings in a bland and universalizable way, which I find unsatisfying because it doesn't grapple with the real problems. It makes the hopeful assumption that all men are equal, that people all over the world are the same. They are not. Singapore shall be forever a sovereign democratic and independent nation, founded upon the principles of liberty and justice and ever seeking the welfare and happiness of the people in a most and just equal society. Even from my sick bed, even if you are going to lower me into the grave and I feel something is going wrong, I will get up.

This is of course Lee Kwan Yew’s idea of running Singapore. Clearly, this mantra can readily be used to assess our leaders.

Our leaders should always stick with those policies that are good for Mauritius irrespective of whether they are good for the politician’s future. The selfless leader would not hesitate to execute policies that are good for Mauritius even if it means making his re-election more difficult as the interest of the country should always take precedence. There are, of course, many policies that are good for both the politician and the country. I hope they appear pretty quickly on Mr. Sithanen’s to-do list.

Person of the year
Attributed to Navin Ramgoolam on account of his massive political achievements in the General and Municipal Elections in 2005.

A note to the readers of The Jag!
Thank you for your very encouraging comments and support. I wish you all Happy Holidays!

Comments: density@intnet.mu

[1] Mr. Sithanen should also tell us pretty quickly what we should be doing to avert a downgrading of our risk rating.
[2] Apparently, Mr. Ali Mansoor holds exactly the two degrees Mr. Sithanen has as they have both studied at LSE. This gives you an idea of the likelihood of an interesting cross-fertilisation of ideas. So much for the value of an orthogonal knowledge set. I have also been made to understand that Mr. Mansoor may be able to help us look at waste from a different angle.
No. 3 December 2005
© Sanjay Jagatsingh, 2005

100 Days After

Poetry is a net with which to catch reality.

Spinoza

Another major event follows the historic victory of July 3^rd: Labour and allies grab all 5 municipalities. That of course includes Port-Louis, Curepipe and Berenger’s stronghold of BB/RH. Of course most of the credit of this massive political achievement goes to the new man in charge of Mauritius: Navin Ramgoolam. Let’s look at a couple of reasons why it’s massive.

1. No political leader in our short political history has staged a comeback by presenting himself as PM for five years. And this without any exit clause.

2. For the first time one of the three major political parties managed to beat an alliance of the other two winning a very comfortable majority.

3. It’s been a long time since we’ve had such a very strong PM in place. That was certainly not the case during 2/5-of-a-term Prime Ministership of Paul Berenger: MPs had just to threaten of provoking a bye-election to get the ear of the then PM and more.

4. All of this has been achieved quite disrespectfully of the divine signal: “The Guy Must Go”.

Naturally, the past few years has confirmed that skin pigmentation is no driver of stellar economic performance – a fact not unknown to anyone not living in the 18^th century Mauritius.[1]

What’s left on Ramgoolam’s shopping list.

This is not dissimilar to Michael Jordan travelling up his own little list of 50+ point performance at Madison Square Garden after his return to the ‘game of basketball’ in 1995.

1. Rama Valayden gets elected in Rose-Hill in 2010 or whenever general elections get called.

2. Labour and allies take all the 3 seats in Rose-Hill.

While the first item was already an intriguing possibility before July 3^rd, the results of the last general elections in No. 19 have confirmed that very little is left to be done (less than 1200 voters need to switch allegiance). And that was of course before the October 2^nd municipal results.

Those who don’t study history…

What happened to the MMM and the MSM this year happened to other parties before: no succession planning.

1. Labour in 1982: (Although, SSR did publicly hint about his successor in 1979).

2. MSM in 1995: Lutchmeenaraidoo and Dulloo were denied their go at the top party-job by being conveniently sidelined.

3. MMM in 2005: Berenger has been around for 36 years with only two as PM. For comparison, Stalin and Brezhnev were in the driver seat for 28 and 17 years respectively.

A Tale of 2 ages.

With the recent change of government we have left the ice age way behind to step into the... stone age. It’s a huge improvement: a sleepy D-350 has been replaced by a vigorous D-14000 (the reach in km of our economic diplomacy), we don’t consider ourselves the best managed country in the world and Prime Ministerial missions are not silly attempts to compete with National Geographic documentaries anymore. But it’s not enough. Here are a few things we should really worry about:

1. Rama Sithanen, Finance Minister, gives the impression that he does not believe in Financial Markets – there was nothing for Financial Markets in his recent statement about setting the stage for robust growth. That’s not good news especially after the overregulation and lethargy witnessed over the past 5 years and given that it’s one of the few pillars where lots of growth is still possible. Deeper capital markets will add up to 200bp to our growth rate and is one of the instruments par excellence for the democratisation of the economy.[2]

2. There is no doubt that this government is well-intentioned. It clearly does not indulge itself in the mathematics of hate. The problem, however, is that an integrated approach to problem solving has not been adopted. Richard Feynman, the daddy of quantum mechanics, among others, rightly observed that “everything is related – you just need to find the link”. For instance, our education and transportation problems are linked for obvious reasons. It’s not because this was not considered in the ‘rattrapage’ Obeegadoo that we need to forget about it.

3. We unfortunately don’t have a measurement culture here. I am sure you heard about “what gets measured gets managed”.[3] This goes even further: what is not measured technically does not exist. And the greatest ignorance-reducing strategy is measurement.

And where are we with the ‘branding Mauritius’ project? Are the neurons of our leaders connected here or are we outsourcing our thinking to the World Bank?

Comments: density@intnet.mu

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[1] One may read Malcolm Gladwell’s Blink (2005) and then Antonio Damasio’s Descartes’ Error (2005) for interesting insights on human decision-making including the benefits of a healthy ventromedial prefrontal cortex.

[2] It is no surprise that Mark Anson, CFA, Chief Investment Officer for CalPERS has been voted “Most Influential” in the current issue of the CFA Magazine. We will return to California in subsequent editions of The Jag!.

[3] Which can be thought of as the modern equivalent of Lord Kelvin’s reminder of knowledge of the “meagre and unsatisfactory kind”.

No. 2 November 2005

© Sanjay Jagatsingh, 2005