Global Recession and Impact on IT in India

Today, Mr. Sitaram Yechuri came to my college to give a talk on the namesake subject.

” This crisis is an inevitable consequence of the path of globalization that was unfolding in recent decades. ”

I wanted to write a small post on this, but when I was gathering resources, I found out this site and came to know that whatever Mr. Yechuri has told us today was already in this site. So I’m just giving a link to the site and I want all the readers to COMPULSORILY go through it if you want to know more about the future of Indian economy.

Now, I come to the points which were exclusively discussed in the college and were not covered in that site.

He said that the recession is reality and we have to face it. If you think that this global recession will be around for the next 8-12 months and after that everything will be all right just-as-before, you are in an illusion. Whenever the annual GDP growth of a country goes in negative (which luckily is not the case with India) even by 1%, it takes at least 3-4 years to recover. And today, the scene is that only 4 countries viz., India, China, South Africa and Brazil have a positive annual GDP growth. Also there is no guarantee that this growth will sustain till the end of this year. So, is there a solution?

Yes. If you’ve read the link above you’ll come to know that the main reason for economic differences between the rich and poor class of people were because of the low purchasing power. So How do we increase the purchasing power of the people. We, Indians feel proud to say that there are 36 billionaires in India, that we have a great economy but the fact is 78% of the people in India live by spending merely 20Rs/day. Only the top 1% of the people hold more money. This clearly explains the scenario of purchasing power of people in India. So what can be done? If you can generate employment for the Indians instead of going for the option of outsourcing, that would be a great idea. Somehow, it is necessary that people have the money so that they can spend it upon the things and thus the purchasing power increases. During the Great Depression, Mr. Roosevelt created this new scheme of dividing the labor into two sets, where one set of people would dig holes in the ground and the other set of people would fill that hole back and both the sets of people were paid for doing that. (Now that’s what I call unfertile employment.) But as you can see, at least they were getting paid for doing that which reduced the income inequalities and increased the purchasing power.

So all I want you to understand is that tough times are ahead and there is no short-cut to run away from them. So lets face them and convert this crisis into an opportunity for developing our country. He ended the talk by giving out this quote :

Whether you want it or not, a new world will be created. The question that arises is, whether you have a role in creating it or not? All I want you to do is take an active part in creating this new world rather than suffering in a world created by someone else.

PS: Mr. Yechuri is an awesome speaker. I enjoyed each and every part of his talk. 🙂


Cheat Theory

Its been a very long time since I’ve written a new post. From now onwards I’ll try to be more serious and keep writing posts regularly.

Coming to the subject, I’ve taken a course “Game Theory” last semester. It was a very interesting course where we came to know about lots of games that we play daily, knowingly or unknowingly. Last night when I was going to sleep, a thought suddenly hit my mind. Whenever we use the word game, we also use the word cheat. I wondered why is there no theory called Cheat Theory?

This is a very important concept. However, ethically this should not exist, but practically, every game has a cheat. May it be sports, Computer games, Personal relationships, Academic performance, or in Casinos. Cheat is applicable everywhere.

A Cheat is a kind of information known to one player which can maximize his/her payoff. Also it can decrease other players’ payoff. This is such an important concept which does not come in the limelight yet its used worldwide.

Eureka! Eureka! I think I just found out some theory which upon developing can shake the world by its results and prove mathematically how world’s greatest, cheats/frauds were organized.

Developing this theory will take a lot of time. Till then ciao.

How Bad Is The Subprime Mortgage Crisis?

Subprime Mortgage Crisis

To understand the nature of the subprime mortgage crisis and how we got ourselves into such an incredible mess (as well as what that mess really is), we need to go back several decades and examine how the financial markets have evolved during that period of time.

We’ll start with a mathematician by the name of John Forbes Nash. If that name sounds vaguely familiar, it’s probably because his life was portrayed in the movie “A Beautiful Mind” starring Russell Crowe.

While the film did a great job of highlighting Mr. Nash’s mental illness, it did a poor job of informing the audience of the important role his game-theory mathematical equations were to modern day finance.

The secondary mortgage market would not have been possible without the mathematical equations that he developed.

Before the introduction and development of the secondary mortgage market, borrowing money to buy a home was rather simple. You applied for a mortgage loan at your bank, and if your banker determined that you were likely to be able and willing to repay the loan, he would loan some of the bank’s deposits to you for the purchase of the house.

The bank needed the deposits in order to make the loan. And if the bank didn’t have enough money in its deposits, it didn’t make the loan.

Rather than come right out and announce that they didn’t have enough deposits available to make any more home loans, banks would increase the interest rate charged and borrowers would choose to apply at a different bank that offered lower rates.

It was a simple illustration of supply and demand working properly in the free market. If there weren’t enough deposits at the banks, interest rates would rise and borrowing would slow.

If the banks were flush with deposits, interest rates would come down as the banks competed with each other for additional business.

The free market would find the perfect equilibrium between the borrowers and the banks through the constant adjustment of interest rates.

The mathematical equations of John Nash made it possible for investment banks to combine those loans into packages and sell those packages to investors.

By being able to tap into larger pools of money besides just deposits at banks, borrowers seeking a home mortgage loan were able to obtain lower rates on their mortgages.

Nash’s equations simply made for more efficient means for borrowers to tap into large pools of money that were available.

The loans were still being made one at a time. But the banks, with the help of Wall Street (which received a commission for facilitating the transaction), could combine hundreds of loans and sell the package to very large investors, such as insurance companies, mutual funds, foreign companies, and even foreign governments.

At that point in time, there still wasn’t a problem. That was how the secondary mortgage market formed and operated in the 1980’s.

Wall Street Firms Got Greedy

Wall Street Corrupts the process

But things begin to change in the 1990’s. Wall Street wasn’t satisfied with just getting a commission. As usual, Wall Street wanted more: more money, a bigger piece of the pie, and more profits. How else could all those Wall Street people afford to buy multi-million dollar homes in the Hamptons?

And this is where the problem begins.

Wall Street made some changes to what was up to that point a very straightforward process. Wall Street added derivatives to the mix.

Instead of just packaging a group of say, 1,000 mortgages together and selling them for the interest that they paid, Wall Street included complicated, opaque derivatives in the package.

The first instance of credit derivatives being used on Wall Street was 1981 when Salomon Brothers arranged for IBM and the World Bank to swap debt payments in Swiss Francs and German Marks for dollar obligations.

The practice spread like wildfire on a dry tundra during the 1990’s.

Wall Street firms deliberately structured these packages to be opaque and confusing. That way, the investors weren’t really sure what they were getting.

Let’s take a look at a simple example to expose the truth. Suppose 500 people each owe me $10.00. That is $5,000 in total owed to me. These people are paying me seventy cents per year in interest (7%).

Suppose that I package the 500 loans together and sell them to you. You would then be able to collect the interest as well as the principal when it is paid back. We will call this a five thousand dollar package.

I might sell this package of loans to you for $4,925 to allow for approximately 1.5% of the loans not getting repaid.

Now, what if that five thousand dollar package didn’t contain 500 loans of ten dollars each? What if it only contained something like 200 or 300 loans for ten dollars each, and of those, more than half were subprime and of questionable ability to repay, and the remainder of the “five thousand dollar package” was used lottery tickets?

Would you still want to pay $4,925 for a package of those loans? Of course not! You would only be owed about half of what you paid, and you probably will not receive even half, because so much is owed by borrowers with poor credit ratings who have difficulty making payments on time. There is no way that “package” would be worth $5,000.

Yet Wall Street put packages like that together. Where was the value for the other half of the package?

From derivatives.

Derivatives are nothing more than speculative bets, thus the example of used lottery tickets.

CDO’s (collateralized debt obligations) are comprised of a combination of mortgages and derivatives very similar to the above illustration.

And therein lies the problem. The value of TRILLIONS of dollars of CDOs is based upon complex, opaque derivatives of very little if any tangible value. The latest figures that the amount of derivatives currently outstanding worldwide exceeds $540 TRILLION.

So here we are in 2008 and these mortgage-backed “securities” have been created by Wall Street by the trillions upon trillions of dollars in the last 20 years.

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The housing market is going one way: backwards.

And everything worked fine, until the housing market turned down and just a few too many subprime borrowers begin to default on their loans.

And when those borrowers stopped making their payments, some holders of the mortgage back securities wanted to cut their losses and sell.

And then comes the 500 trillion dollar question: sell to whom?

You see, every other holder of mortgage-backed securities was experiencing the same thing: an increased number of defaults.

These packaged mortgage securities are not traded on an exchange like stocks. They are unregulated by the government. The buying and selling of them is done privately.

The problem is that the largest portion of value in these various mortgage-backed securities is based upon derivatives that are of “questionable” value at best. When a hedge fund, bank, or insurance company decided to sell their “investments” in CDO’s in the later summer of 2007, there simply were no buyers.

The genie was let out of the bottle, and now there is no way the genie can be put back into the bottle again. Specifically, the genie is the fact that the CDO’s, MBS’s, and most “structured finance” products are not worth anywhere near what they are supposed to be worth, or what Wall Street firms claimed that they were worth.

The buyers of these financial products have now realized en masse that they have been sold a package that isn’t worth anything near what they paid.

Needless to say, investment buyers around the world have stopped purchasing mortgage-backed securities, resulting in the funding for mortgages drying up. Everything from First time home buyer loans to jumbo mortgages are now much more difficult to obtain.

And this will cause massive changes to the economy through a domino-type effect. The first area to be effected has been real estate. It has already started, but what you are seeing is just the beginning of the first inning, we’ve still got 8 and one-half innings to go.

Congressman Ron Paul question the Federal Reserve Chairman on the housing crisis.

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Basically, the secondary mortgage market is barely functioning, if at all. Banks now have to lend from their own deposits. Needless to say, last year, when banks and mortgage companies could sell the loan as part of a package, they were not nearly as concerned with the borrower being able to pay back the loan. That would become somebody else’s problem.

Now that banks have to loan from their own funds, they have become very, very concerned about the borrower’s ability to repay. Banks don’t want to take losses. They want profits. And they are not going to loan to questionable borrowers.

That mean that millions of people who previously qualified for mortgage loans under the old rules no longer qualify. Thankfully, many states still provide first time home buyer grants to help 1st time buyers qualify for their first mortgage.

The days of the “no-doc” loan are gone. The days of the real estate boom are gone. We are now headed rapidly in the other direction: real estate bust.

In the coming months, billions upon billions worth of mortgages that had low initial “teaser” rates will be resetting higher. Much higher. Many of these people will not be able to afford to keep their home.

Foreclosures are already increasing rapidly. Expect this trend to continue for at least the next 2 years. It may take 3 to 4 years for the glut of foreclosures and extra inventory to be worked out of the system.

Because of this, look for real estate prices to continue to fall. Again, expect this trend to also continue for the next 2 to 4 years. But even when it does come back, without a prosperous secondary mortgage market, real estate will never be like it was in the late 1990’s and early 2000’s.

When you consider that construction and real estate accounts for 20% of the US economy, expect real estate to drag down the rest of the economy. Millions of construction workers, real estate brokers, mortgage loan officers, as well as workers in related industries such as appliance manufacturers, carpet manufacturers, window companies, etc, will all be searching for other lines of work.

The level of business in real estate and construction will not support the amount of labor and careers that it did 2 years ago. It may not even support half of it.

Warning: The Television Talking Heads Will Announce Over and Over that the “Worst is Behind Us”

What else can they do? Do you think they can tell the truth and announce that it is going to get worse? That would cause consumers to prepare for the coming hard times by reducing their spending and hoarding cash. The very action of consumers reducing spending would hurt an already critically-ill economy even more.

Forget it. You will not be told the truth by the mass media.

The worst will not be behind us until the mess has been cleaned out of the system, and that is going to take, at a very minimum, 2 to 3 more years. That’s a minimum. It could be much longer, depending upon how the government handles the mess.

Governments usually don’t do what’s best for the population as a whole. Governments typically do what’s best for the few well-connected. Expect big, fat-cat bankers and Wall Street Firms to be bailed out, but very little in the way of real help for the common man.

Unfortunately, the common man will suffer the most.

Despite “official” government statistics that proclaim the economy isn’t that bad off, the truth will be the exact opposite. The economy is in a downward spiral that will not be stopped.

The only way to stop it would be for banks to go back to their loose lending standards and for the secondary mortgage market to go back to doing billions upon billions of dollars per week in CDO’s and MBS’s (collateralized debt obligations and mortgage-backed securities).

But investors no longer want to purchase CDO’s and MBS’s that are full of toxic derivatives, now that the secret about the true value of those derivatives is out in the open. And no bank wants to make reckless loans with their own capital at risk. That only leaves us on the path we are on: a cleaning out of the real estate mess.

Lower interest rates will not help. The interest rates on home mortgages could go to zero. But what good would that do if the banks will not grant you a loan? It doesn’t matter what the published interest rate is. If the bank won’t give you a loan, the interest rate is merely for show.

Source :

Best Article on Subprime Mortgage Crisis

Why is the US Economy Facing A Recession?

Readers Question: Why is the US economy facing an economic meltdown?

The US economy faces many severe problems, a falling stock market, record levels of public debt, banks on the verge of bankruptcy, frozen money markets, a plummeting dollar and the imminent threat of a recession. How did the US economy get into such a desperate situation?

The Housing market

The housing market plays a crucial role in determining consumer spending and therefore the rate of economic growth. When house prices are rising, consumers experience an increase in wealth; this boosts their confidence and enables them to remortgage and gain equity withdrawal to spend. When house prices fall, the opposite happens.

The Housing Bubble.

Up until 2006, US house prices rose rapidly; against a backdrop of rising house prices many analysts felt that even risky mortgage loans were safe and this encouraged even more unsuitable mortgages. For example, it was hoped 100% mortgages would be easier to pay back because rising prices would give homeowners an effective deposit.

The combination of low interest rates, aggressive marketing of mortgages and overly optimistic predictions for the housing market caused house prices to rise. However, the ratio of house prices to income went far above the long run trend rate; making mortgages increasingly unaffordable for first time buyers. Then in 2006 the Fed were forced to raise interest rates to over 4% because of inflationary pressure in the economy. This increase in interest rates caused many mortgage owners to struggle with their repayments. Also, there was another problem – many new mortgages were ‘balloon mortgages’ this means that for the first two years homeowners had a specially low introductory rate. However, after two years, the mortgage rate suddenly shot up increasing monthly payments very significantly. Therefore, first time buyers who had stretched themselves to get a mortgage suddenly found themselves with a large increase in monthly payments. There are several examples of homeowners with mortgage payments greater than their total income. These mortgages should never have been sold, but, in the housing boom there was a lack of self regulation. The needs of the consumers were ignored in the pursuit for selling ‘profitable mortgages’

The Housing Bubble Bursts

Therefore, with a rise in defaults and fall in affordability, the US housing market turned. Suddenly after years of growth, the ‘unthinkable’ happened and house prices started to fall. This came as a shock to many who assumed house prices could only rise. Therefore, people who had been speculating in the housing market felt this was the time to get out and sell. Therefore, prices fell even more. Since their peak in 2006, house prices have fallen by 10% (in some areas it is much higher, the housing market is very localised). Furthermore, there is still the prospect of even more falls in house prices. As house prices fall consumers have less confidence to spend. There has also been a worrying increase in unemployment in real estate related jobs, such as construction.

The Credit Crunch

The problems in the US housing market and in particular the subprime mortgage sector soon spread to the rest of the finance system. Many big investment banks and commercial banks had been enthusiastic purchases of these CDOs. Basically, big banks had been refinancing these risky mortgage loans. When mortgage defaults started to occur, the commercial banks realised they were facing huge losses. Their losses were exaggerated by the risky nature of the loans. Some hedge funds collapsed completely. Despite the magnitude of the defaults, many of the big banks could afford to write off billions of pounds and still remain solvent.

However, the experience left Wall Street and the global finance system realising the dangers of risky lending. Therefore, the market sentiment changed to one of great conservatism. Banks were reluctant to lend to anyone, even each other and usually secure lending. This led to a shortage of funds in the money markets (such as interbank lending). This credit crunch is basically about a shortage of liquidity in the finance sector. The effects are that ordinary borrowing becomes more expensive and more difficult. Both the UK and US have seen most ‘subprime’ lending products withdrawn.

The credit crunch has also caused great difficulties for banks such as Northern Rock in UK and Bear Sterns in the US. Basically the banks couldn’t raise enough money on the money markets so had to resort to some kind of rescue package. The concern is that more banks could suffer a similar fate and future bank rescues will be more difficult.

Because of the credit crunch, since July, the monetary authorities have been forced to inject liquidity into the money markets three times to avoid a complete shortage of funds. However, there is no guarantee that the markets won’t keep freezing again.

Effect on Consumers and Economic Growth

Falling house prices, falling confidence, higher costs of borrowing have all contributed to a fall in consumer spending and it is this which is the main factor causing a downturn and likely recession. Furthermore, the credit crunch has caused difficulties for many borrowers, who now struggle to borrow at affordable rates. The US also has very high levels of consumer borrowing, therefore, increased cost of borrowing has caused widespread problems. – although the rate cuts by the Fed have made it less painful, it may still not be enough.

It Gets Worse

On its own the Housing crash and credit crunch would cause serious problems. However, the US economy has other underlying problems which makes it more difficult to deal with the problem.

Devaluing Dollar. In one sense the depreciating dollar is helping to increase exports and maintain growth in the export sector; to some extent this may counter the fall in consumer spending. However, the depreciating dollar is contributing to both cost push inflation and declining living standards. This means the US could face the unpleasant occurrence of both inflation and lower growth. It makes the job of the Fed more difficult; in particular rate cuts further weaken the dollar and increase inflation. At the moment, the Fed have decided the recession is more serious than inflation, and rates have been cut.

Current account deficit. The current account deficit is an indication of an unbalanced economy – too much spending, low savings ratio. A downturn in the economy and depreciation in dollar are necessary to deal with this.

National Debt. The US national debt stands at 65% of GDP, (even more if you include future pension liabilities). This gives the economy little room for expansionary fiscal policy. It means the US pays a lot in debt interest payments and the forthcoming recession will only aggravate the debt situation.

Nice Interview Tips


Because communication skills are such an integral part of effective management, some schools include personal interviews as part of the admissions process. Some tips to help you prepare for an interview :
o Review your application; the interviewer is likely to ask specific questions about it.
o Be ready to provide examples and specifics and to elaborate on info on your resume and application.
o Be open and honest.
o Ask questions, since the interview is as much an opportunity for you to learn about the school as for the school to learn about you.
o Follow proper business decorum.
o Watch your nonverbal clues, such as eye contact, posture, and fidgeting. o Be courteous to the administrative staff, since how you treat them can have an impact (positive or negative).

Some Frequently Asked Questions on Interviews :

“Tell us about yourself”?

In an interview how does one handle the question “Tell us about yourself?”.

An often asked opening question. Perhaps the most frequently asked question across interviews. Your opening statement needs to be a summary of your goals, overall professional capabilities, achievements, background (educational and family), strengths, professional objectives and anything about your personality that is relevant and interesting. This question represents an opportunity to lead the interviewer in the direction you want him to go e.g., your speciality or whatever else you may wish to highlight.

Your intention should be to try subtly convincing the interviewers that you are a good candidate, you have proved that in the past and have a personality that fits the requirement.

Remember that the first impression you create will go a long way in the ultimate selection. Keep in mind, most candidates who are asked this question just blurt out their schooling, college, marks and qualifications. All this is already there in the CV. Why tell the interviewer something he already knows?

A final word on approaching this question. Once you have said what you have to say – shut up. Don’t drone on for the sake of speaking for you just might say something foolish. Sometimes interviewers don’t interrupt in order to give the candidate the impression that he has not spoken enough. This is just a stress/error-inducing tactic. Don’t fall for it, especially if you feel you have spoken enough. In case the pause gets too awkward for your liking, just add something like, “Is there something specific that you wish to know about me?”

Is it better to have a longer selection interview or a shorter one?

The length of an interview in no way is an indicator of how well an interview went. This is especially so when there are a number of candidates to be interviewed, like in the Civil Services interview or the MBA entrance interview. In the past, a number of candidates have reported varying lengths of interviews. Nothing positive or negative should be read into this. An interview is only a device whereby the panel seeks information about the candidate. Information that will help the panel decide whether or not the candidate should be selected. If the panel feels that it has gathered enough information about the candidate in 15 minutes of the interview commencing and that it has no further questions to ask the interview will be terminated in 15 minutes. If on the other hand the panel takes an hour to gather the information required to take a decision the interview will last for an hour. In either case the decision could be positive or negative. It is a fallacy to believe that interview panels take longer interviews of candidates whom they are more interested in. No panel likes to waste its time. If an interview is lasting longer than usual then it only means that the panel is seeking more information about the candidate in order to take a decision.

In the MBA entrance interview how do I justify my decision to pursue the MBA programme?

When you are asked this for God’s sake don’t tell the panel that you are looking for a”challenging job in a good firm with lots of money, status and glamour”. That is the first answer that most candidates think of. Unfortunately, it is the last answer that will get you admission. In the answer to a direct question on this subject you must convey to the interview panel that you have made a rational and informed decision about your career choice and your intended course of higher study. There are broadly four areas which your answer could touch upon:

Career Objectives : You could talk about your career objectives and how the two year MBA programme will help you achieve them. This implies that you have a clear idea of what your career objectives are and how you wish to achieve them. For example, you may want to be an entrepreneur and wish to set up your independent enterprise after doing your MBA and then working for a few years in a professionally managed company. You could explain to the panel that the MBA programme will provide you with the necessary inputs to help you run your business enterprise better. But then you must be clear about what the inputs you will receive in the MBA programme are.

Value Addition : That brings us to the second area that your answer should touch upon. What is the value you will add to yourself during your two year study of management. Value addition will essentially be in two forms knowledge and skills. Knowledge of the various areas of management e.g. marketing, finance, systems, HRD etc. and skills of analysis and communication. You will find it useful to talk to a few people who are either doing their MBA or have already done it. They will be able to give you a more detailed idea of what they gained from their MBA.

Background : Remember, there must be no inconsistency between your proposed study of management and your past subject of study or your past work experience. If you have studied commerce in college then management is a natural course of higher studies. If you are an engineer this is a tricky area. You must never say that by pursuing a career in management you will be wasting your engineering degree. Try and say that the MBA course and your engineering degree will help you do your job better in the company that you will join. But then you should be able to justify how your engineering qualification will help.

Opportunities and Rewards : You could also at this stage mention the opportunities that are opening up in organizations for management graduates. Highlight with examples. At the end you may mention that while monetary rewards are not everything they are also important and MBAs do get paid well. You must not mention these reasons as your primary motivators even if that may be the case.

What to Expect ?

In general, B-school interviews are not formulaic. The focus can range from specific questions about your job responsibilities to broad discussions of life. Approach the interview as a conversation to be enjoyed, not as a question-and-answer ordeal to get through. You may talk more about your hobbies or recent cross-country trip. This doesn’t mean that it won’t feel like a job interview. It just means you’re being sized up as a person and future professional in all your dimensions. Try to be your witty, charming, natural self. Interviews are conducted by students, faculty, admissions personnel and alumni. Don’t dismiss students as the lightweights; they follow a tight script and report back to the committee. However, because they’re inexperienced beyond the script, their interviews are most likely to be duds. You may have to work harder to get your points across.

How to Prepare ?

Prepare for the interview in several ways: Expect to discuss many things about yourself. Be ready to go into greater depth than you did in your essays (but don’t assume the interviewer has read them). Put together two or three points about yourself that you want the interviewer to remember you by. Go in with examples, or even a portfolio of your work, to showcase your achievements. Practice speaking about your accomplishments without a lot of “I did this, I did that.” Finally, be prepared to give a strong and convincing answer to the interviewer’s inevitable question: “Why here?”

Self Awareness
1. How would you describe yourself ?
2. Tell me about yourself ?
3. How do you think a friend or professor who knows you would describe you?
4. What motivates you to put forth your best effort ?
5. How do you determine or evaluate success ?
6. What academic subjects did you like best ? Least ?
7. What led you to choose the career for which you are preparing ?
8. What personal characteristics are necessary for succeeding in the career that you are interested in ?
9. What is your philosophy of life ?
10. Why have you switched career fields ?

Weaknesses / Negatives

1. What major problems have you encountered and how have you dealt with them ?
2. What have you learnt form your mistakes ?
3. What do you consider to be your greatest weakness ?
4. Did you ever have problems with your supervisor ?

Skills / Abilities / Qualifications

1. What do you consider to be your greatest strength ?
2. Are you creative ? Give an example.
3. What qualifications do you have that makes you think you will be successful ?
4. In what way do you think you can make a contribution to society?
5. Why should we take you ?
6. What are your own special abilities ?
7. Why should we take you over another candidate ?
8. What is your managing style ?
9. Why do you want to join this institute ?
10. What do you know about our institute ?


1. What is your attitude towards working hard ?
2. What part does your family play in your life ?
3. What are the most important rewards you expect in your career ?
4. What is more important to you : money offered, or the type of job ?
5. Do you enjoy independent research ?
6. In what kind of a work environment are you most comfortable ?
7. How would you describe the ideal job for you ?
8. What two or three things are most important to you in your job ?
9. Do you prefer working with others or all by yourself ?
10. How do you like to work ?
11. Under what conditions do you work best ?
12. What is the highest form of praise ?


1. In what part-time or summer job have you been most interested ?
2. Tell me about your experience.
3. What jobs have you held ?
4. How did your previous employer treat you ?
5. What have you learnt from some of the jobs that you have held ?
6. What jobs have you enjoyed most ? Least ? Why ?
7. What have you done that shows initiative and willingness to work ?
8. Describe your current job.
9. What did you like least about your last job ?
10. What did you like most about your last job ?

Goals / Objectives

1. What are your short-term and long-term goals and objectives ?
2. What specific goals other than those related to your occupation have you chosen for yourself for the next 10 years ?
3. What do you see yourself doing 5 years from now ?
4. What do you really want to do in life ?
5. How do you plan to achieve your career goals ?


1. How has your education prepared you for a career ?
2. Describe your most rewarding college experience.
3. Why did you select your college or university ?
4. If you could, would you plan your academic study differently ?
5. Do you think grades are a good indication of your academic achievement ?
6. What have you learnt from participation in extracurricular activities ?
7. Do you have plans for continuing your studies ?
8. Why did you pick your programme ?
9. What courses did you like best and why ?
10. What courses did you like least and why ?
11. How has your college experience prepared you for this job ?
12. How did you pick your dissertation ?
13. Describe your dissertation process.


1. What do you expect to earn in 5 years ?
2. What did you earn in your last job ?


1. What are your outside interests ?
2. What do you do with your free time ?
3. What are your hobbies ?
4. What types of books do you read ?
5. How interested are you in sports ?
6. How did you spend your vacations in school ?


1. What qualities should a successful manager possess ?
2. Describe the relationship that should exist between a supervisor and a subordinate.
3. What 3 accomplishments have given you the greatest satisfaction ?
4. If you were taking a graduate for this institute, what qualities would you look for ?
5. What can I do for you ?
6. Tell me a story.
7. Define cooperation.

Stress Questions

1. What causes you to lose your temper ?
2. How often have you been absent from school, work or training ?
3. Have you ever had trouble with other people on the job ?
4. Can you take instructions without getting upset ?
5. Don’t you feel you are a little to old/young for this job ?
6. How does your family like you being away on business trips ?
7. With your background, we believe that you are overqualified to join this institute.
8. You haven’t had sufficient experience in this field.
9. Our experience with women on this job has not been good.
10. What would irritate you most if I as a manager did it ?

Influencing Others

1. Tell me about the time you were most persuasive in overcoming resistance to your ideas or point of view.
2. Tell me about the last time someone made an unreasonable request of you.
3. Describe the most disappointing and frustrating experience in gaining the support of others for an idea or proposal.

Interpersonal Skills
1. Describe a situation where it was most important for you to display tact and diplomacy.
2. Tell me about the last time you had a clash or disagreement with someone at school/college/workplace.
3. Tell me about a time when you felt most frustrated and disappointed at a person with whom you had worked.

Personal Adaptability

1. Tell me about the last time you were criticized by a supervisor or a professor.
2. Tell me about the time when you felt most pressured or stressed at work/ school/internship. 3. Tell me about the time when you felt most frustrated at your school/workplace.
4. In what aspects of your work/internship do you have the most confidence in your abilities.

Communication Skills

1. Tell me about the time when you felt best about your ability to draw out or solicit information from another person.
2. Tell me about the time when you had to work your hardest in order to fully understand what another person was saying to you.
3. Describe the last time when someone at school/work misunderstood what you were trying to communicate.

1. Tell me about the most long term, sustained extra hours of effort that you put into your work/college/internship.
2. Describe a time when you felt most frustrated or discouraged in reaching your goals or objectives.
3. What do you feel has been your most significant work/school/internship related achievement within the past year or so ?
4. Describe the last time you did something well which went beyond the expectations in your work/internship.

Administrative Skills

1. Tell me how you go about organizing your work and scheduling your own time.
2. What do you do to ensure that your goals and objectives are met in a timely way ?
3. Describe the most extensive planning that you have ever done.

Problem Solving and Decision Making

1.Tell me about the most difficult problem that you faced in your work/school/internship ?
2.Tell me about the last time you made a decision that backfired.
3.Tell me about the time when you regretted most not getting advice before you went ahead ?

Conflict Management Skills

1. Tell me about the last significant crisis situation that you faced in your work.

2. Tell me about a time when you were most persuasive in overcoming resistance to your ideas.

3. Tell me about the time when you had a disagreement with someone at work.


All the best for the interviews!

7 days remaining for CAT 2008

What to do and What not to do in the last 7 days. (An awesome passage by Sarang Gupta from

It is often said, that a true dream is not what you see in your sleep, it’s the one that does not let you sleep.

It is that time of the year when one of the toughest exams on any side of this multi billion year old planet approaches again. It’s an exam that tests the character of a person as much as it tests his skill. For many, who appear for this grueling test of will and skill, it’s also the time when they decide whether to fight for their dream or to simply try again the next year. This article is for all those people to dare to believe that they have it in them to shoot the 10 pointer.

The typical situation for most such people is as follows. They have done well in at least one of the mock CATs that they appeared for and many wonder whether it was a fluke. Unfortunately it’s the stage when many give up hope, thinking simply that they are just not good enough and many lose their way, because they don’t know what needs to be done to make the final cut.

In the final stages one has to study smart and not hard. It requires a lot of analysis, patience and the will to believe. I shall break the problem down to smaller elements…

1. The approach you should take
2. The techniques you should have mastered
3. The analysis you REALLY need to do

1. The approach you should take

The best strategy is to take one mock test a day followed by a detailed analysis of the test. In the remaining time, you could clear the concepts you find lacking in various sections and improve on preparation holes surface from the mock test analysis.

The idea of taking as many tests as possible is to get you battle ready, with barely a few days remaining, most people have already done a lot of practice and are sufficiently aware of various concepts for all sections. However taking a test itself is an art and requires a lot of stamina and patience.

You must also keep in mind your stage of preparation; if your concepts still need improvement then you could take lesser number tests. You should also not end up in a situation that at the time of the D-Day you become totally fatigued. It’s always good to relax once in a while. So one should take as many tests possible keeping these aspects in mind.

The best way to approach every mock test is to try and do it better than your best. If you could do that for every test, then you are on the path to beat the rest.

Ideally people should spend their day according to how it would be on the D-day. That is, take all your mock tests at 10 am. That gets the entire body clock to function accordingly. I have often seen that people who are used to practicing in the night, are not able to perform with the same efficiency in the morning. However for those who cannot practice in the morning, they should find opportunities to test themselves in the morning. It is admissible to go late to office once in a while.

To get your body clock to work for you when the CAT clock is working against you, one should get up every day like it were the d-day. Do what you would do before the actual exam, eat light and do whatever makes you feel good. Under any circumstances don’t fall for a gastronomical meal before the exam.

Wear the most comfortable clothes you have because the last thing you want to worry about is the jeans being too tight for you to fit in. Accept that you are not going to a fashion show after all.

For the first five minutes before you take the mock test, do some mental calculations to get your head running and stimulated, quite like an athlete warms up his body.

How the CAT is solved has led to a more than a billion dollar industry, hence I would not delve on the point. But one needs to have evolved to certain levels in their approach, technique and strategy in order to crack the CAT. It’s not necessary that you would have developed each one of these. But some techniques could be…

2. The techniques you should have mastered


Give 2 minutes to browse through the sections and glance over the type of questions, to understand which section you should take up first. Following a strategy of solving only English or Math’s first could lead to your doom, especially if that’s the tough section.

One easy technique in the Math section is to look out for short questions, of the nature you easily able to recognize.
In order to develop a sense of selecting a section you need to develop the ability of glancing through.
Glancing involves spotting the key elements of the question to understand what it is about. It is something we all do when the time is precious, but one need’s to put a lot of thought about how to select a question after glancing it. It is a sin to read the entire question in order to decide whether you would solve it. Time is extremely precious. Hence glancing questions and sections through can give you the start you need.

Reading a question twice is could also lead to trouble; one must develop the ability to assimilate all information while reading in a precise manner at once. One technique could be to jot down the values beside the question as you read it.


While it is good to know the formulae behind different types of questions, your approach should not be to look for formulae to solve a question. In fact a lot of questions could be solved through simple logic. When doing the problem focus on what the problem is rather than which formula to apply. Try to reduce your dependence on knowing multiple formulae with short cuts, for different types of questions.
This said, there are obviously situations when you just can’t do without the formulae, again the idea is one should not be worried about whether he or she remembers them, be confident about what you know and not worry about what you don’t know. Once a week you go through the formulae that you feel are important, an interesting way to decipher the same is to play around and combine formulae and think what twists you could bring in them.

You need to be able to spot the easy questions irrespective of your ability to solve certain type of questions, which perhaps is one of the greatest tricks to crack the CAT.

You definitely need to let your ego die. Just because you have solved 500 questions in Probability and have developed a comfort level in it, does not mean you would be able to solve the 501st question. It also could lead to a trap, where you would end up wasting time on a long drawn out question.

Working out a question backwards from the answer, is an underutilized form of answering. Try practicing it even for those questions which seem impossible to be solved by the approach. Most questions are solved through multiple steps, at each step try and use the given answers to your advantage. Developing ability to do so can save you precious time.

You should definitely have developed a comfort if not a mastery towards all forms of questions, you never know which questions might come easy.

Data Interpretation

You should be able to solve DI questions without using a pen. DI questions are normally ones in which calculations are required. Hence if you begin to write things down for each and every question, then DI can consume a lot of time.

You should focus on solving problems without using a pen as far as possible. This is to challenge you to think of innovative ways to solve questions. In DI, it’s important to understand that calculating the correct answer is not the challenge; the challenge lies in spotting the right answer. If there are questions where you need to calculate then probably the question is not worth answering.

The above words are more of an approach to follow. Some people find it very difficult to solve DI as it requires a lot of calculation and they think they are just not that fast with numbers. If something however is working well for you, then perhaps you can continue with your strategy.

You should have developed your own tricks for addition, subtraction, percentages etc. Simple calculations, for instance adding of (36+78+93+41+76+89+53=466) should not hassle you too much. One technique is to round them off (35+80+95+40+75+90+55=470). Generally, that is enough to indicate the right answer.

Similar percentage calculations of 348/812 should not be a problem. A convenient way is to take 10% of the denominator (which in this case is 81.2), 4 times of 10% or 40% is ~324 which leaves a remainder of (348-324) of 24. Then take 1% of denominator (which is 8.12), ~3% therefore would be 24, so you get an answer as ~43%.

Though at first this may seem tedious it actually is a technique you could use to calculate percentages real fast within your mind. You should have developed your ways of identifying which graph would be easy to read; for instance, pie-chart questions are usually the easy ones. However, do not put too much weightage on pre-conceived notions.

You should have developed a way of jotting down markings on each graph to help you simplify the problem. For instance line graphs with more than 3-4 lines can often confuse you, you could make marks on the line to differentiate easily.


Reading Comprehension is normally a cause of concern for many people. You should have by now been able to develop multiple ways of reading a comprehension passage. For example, some test-takers read questions first to get a hang on whether the questions are factual or philosophical. Some people read the first paragraph, the last paragraph and the first lines of each paragraph and then try to attempt questions directly.

Some people develop very fast reading abilities and hence comprehension becomes a cakewalk for them. For each type of comprehension passage, you should have a ready strategy. If majority of the questions seem too factual, then perhaps reading the first lines of each paragraph, should give you sufficient idea about where the answer lies. Some people only look to solve factual questions across all passages.

Reading the first paragraph slowly is often key to understanding the rest of the passage, hence it’s always advisable to read the first paragraph slowly.

A common time consuming problem in comprehension and other english questions is that more than one answer seems right, and we often end up wasting crucial minutes trying to argue over the ambiguity between possibly correct options. More often than not, we get half of our intelligent answers wrong. One needs to have the trick to break away from this mental loop. A technique I personally adopted was to mark the longer answer as correct. You could always keep a mark of the question and return if you have time.

3. The analysis you REALLY need to do

People are often happy just taking the test and then seeing what was their score is at the end of it. I think it’s the worst approach you could have. You need to do a detailed analysis for every test you take. It could be the difference between you doing good and doing your best. One must carefully do the following…

How many and which easy questions did you miss and why did you miss them? Did you leave them because they were long? Did you leave them because you were not confident in their concepts? Did initial wastage of time lead to missing easy section?

Which questions did you answer wrong and where did you go wrong, made careless mistakes or suffer from ignorance of concepts etc?

For every mock test, you could track the number of questions you could not solve due to lack of concepts, the number of easy questions you missed and how many questions were answered incorrectly due to careless mistakes. This could help you identify crucial improvement areas

The most important point being – which questions could have been solved faster, and how could they have saved precious minutes?

For example, which questions could have been solved using the answer directly, or which questions could one have solved using a simpler approach rather than the complicated approaches we often adopt? This insight is extremely important, because it often leads to you being able to identify easy questions and considerably reduces your dependence on formulae.

In English, you should carefully see which passages you ought to have have attempted, and what could have been the reading style. Hence you need to spend time on thinking multiple ways to solve a problem.

The importance of analysis cannot stressed upon more. It’s a simple process however it should be thorough, often taking more than 3-4 hours.

I hope these simple thoughts will help you make the cut. May the force be with you!!


A small experiment

Please look at the following pic. Can you find a hidden deer?

Ok. Now record the time taken by your brain to find out the hidden deer. Now reset your timer and have a look at this pic. Now, can you find the hidden tiger?

Again record the time taken by you to find the hidden tiger. If you’ve seen both the pics for the first time, you’ll notice that the time taken to find the hidden tiger was more than the time taken to find the hidden deer?

Why does this happen? I’ll tell you. Visual illusions are more catchy and are immediately spotted by our receptor cells. You can spot the hidden deer within 2 – 3 seconds. Now your brain starts constructing things and when you see the second image, first your brain tries to find the image of a tiger in the second image, instead of finding the text. It tries and tries and in the end it gives up. The answer actually lies in the image itself. Look at the stripes of the tiger. But your brain was not able to figure it out in the first shot(Why?). Its not your mistake. Its the way brain constructs things. It happens to everyone. This is called as learning by experience. Now once you have noticed the difference you’d like to tell this to your friends to see if they too can find it in the first shot. Believe me its hard for any normal human being to find it in the first take. This is because right from our childhood we’ve trained our brain to do things in this manner only. This is how we have shaped our brain to be and hence this is how it is. There are more than 100 forms of learnings. Learning by experience has always topped the list.

This does not end here. You can cultivate your mind to think in anyway it wants to, you can reduce the time in solving puzzles by thinking in a different way, you can solve the problems easily. There are many techniques. But this requires practice, a lot of practice. Right from our childhood we have cultivated our brains to be like this and changing the way we think isn’t going to be easy. Change is never acceptable in first place. But later you get used to it. To find out more on this read the books by Edward De Bono. And also by doing meditation and a few other techniques, the capacity to think can be improvised. After all, isn’t our brain the most beautiful thing ever created by God?
Keep reading for more information on cognitive processes and thinking capabilities.