Saturday, June 21, 2008

A Sapling Grows Into a Giant; The Streets Around It Change, Too

I grew up in Madras. As was the case with numerous other places, even Madras had its places which had lots of trees. As the economy grew, more people made money, credit culture also took great shape, enticing millions of individuals all over the country to go for their personal transport which in turn lead to traffic jams finally resulting in authorities resorting to road widening projects. Madras also participated in this journey for personal vehicles. In short, we had more vehicles than what we could handle. Never mind if the trees were still healthy. Never mind if the trees gave a cool shade to the citizens all these years. The only way by which roads could be widened was by reducing the footpath and removing trees. There were also accidents due to trees. Heartlessly, our local administrations, over the years, have faithfully carried out the tasks of reducing footpaths and removing trees, though in the later case, they were ably aided by property developers, flat owners, owners of hoardings etc. The sufferers were those who had to walk around - in the absence of footpaths and in the absence of cool shades of the trees.

Once a Public Interest Litigation (PIL) resulted in the Madras High Court ordering a stay on the felling of trees along G. N. Chetty Road, North and South Usman Roads, C. P. Ramaswamy Road and TTK Road until an expert panel looked into the issues. Authorities are confronted with a decision making issue - save trees or widen the roads and ease the traffic. The easiest decision to take is to support the public, property developers etc. as at the end of the day, they are the people who are going to vote for politicians. See, we are a democracy where only people have voting rights. Trees don't vote! While PILs helped in saving some time, often the contractors who are given the job, are in great hurry and clear the trees before anyone could react. Transplantation could be tried out wherever possible, but it has not been successful, as it is not a statutory requirement. The easiest solution is cutting of trees, which our people have faithfully done, most of them under the cover of night. In the end, trees lost their lives and Madras lost its tree cover.

I was reminded of the lost trees of Madras when I read this article about a tree in New York Times. Some highlights from the article.

"...The tree, on Kane Street near Tompkins Place, became a giant, with branches that reach across Kane, roots that have torn apart the sidewalk, and a trunk wrapped in vines that leans into the street like an old man warning cars away. In recent weeks, though, residents who live appreciatively in the mulberry’s shade feared the tree faced a new threat: a city chain saw. Then, one morning in early June, Mark Melamed saw posted signs explaining that trees on the street were scheduled for trimming or removal. The family feared the worst. The Melameds’ 16-year-old daughter, Caroline, went to school that day “close to tears,” her mother, Helen Melamed, said. The mulberry’s branches scraped Caroline’s window, providing a leafy prism on the neighborhood. She anxiously called home from school to find out what had happened to the tree...."

Sunday, June 15, 2008

Whip Inflation Now

Highlights from John Mauldin's "Thoughts from the Frontline".

President Nixon instated price controls on the 15th of August, 1971. Inflation was a little over 4% at the time. Price controls manifestly did not work (resulting in shortages of all sorts and a deep recession) and were rescinded a few years later. President Ford went to Congress with programs to fight inflation that was running closer to 10% in October of 1974, with a speech entitled "Whip Inflation Now" (WIN). He famously urged Americans to wear "WIN" buttons. That policy too was less than effective, and the buttons, in a history replete with silly gestures by governments, should stand on anyone's top ten list of such silly gestures. Cynics more thoughtfully wore the buttons upside down and said the inverted letters (which looked like NIM) stood for "No Immediate Miracles." They were right. There was no miracle, just eventual pain and lots of it. Ultimately, Paul Volker defeated inflation, but at the cost of two serious recessions and a lot of economic misery, with unemployment levels over 10% for nine months in 1983.

Some call for the Fed to raise rates so that we do not have to experience another lost decade like the '70s and then ultimately see some future Volker forced to raise rates and drive unemployment back to 10%. Others suggest that "core" inflation is what should be paid heed to, and urge caution. "What will Ben do?" As Donald Coxe has noted, North America has had an 18-year run of remarkably good weather in our growing season. You have to go back 800 years to get a string of years that were that good. Yet today food reserves of all types are at decades-long lows. There is very little room for any type of problem.

Bottom line, Bernanke is in a very difficult position. Inflation by any standards is too high. But the cause of the inflation is not something in the Fed's control. To bring inflation back to 2%, he would have to savage the economy, perhaps at least as much as Volker did. Do you want to see unemployment go to 8-10%? Volker was dealing with wage inflation. Everything had cost of living adjustments (COLAs) back in the late '70s and early '80s. Spiraling wages were one of the primary causes of inflation, if not the most important. A higher Fed funds rate could do something about rising wages by increasing the unemployment rate. Tough love, but effective. Volker had to kill inflation expectations. Today, that is not (so far) Bernanke's problem.

Raising rates in any serious manner would whip inflation but would kill the economy at this point. Rates will need to go back up at some point, but not until the economy shows signs of a rebound. Countries throughout Asia would love to have a 4.2% inflation rate. Indonesia is at 10.4%, almost twice what they were a year ago. Vietnam would love to have such mild inflation, as its own level is up over 25%. Inflation in China is 8%. Inflation is up throughout the continent. And oil and food are the culprits. Korea is particularly strained. Korea has seen its import prices rise by almost 45% in the last 12 months.

What good would a rate hike do? How much more oil or corn would be produced? Why increase our pain when there could be no positive result? The central banks of the world got by for years with easy monetary policies (think Greenspan) because of rising productivity, cheap energy, increased international trade, a disinflationary environment because of cheap Asian labor and imports, etc. Now that economic regime has come to an end. Stability had bred instability in a very uncomfortable Minsky Moment. There are no good solutions. There will only be a choice of how much and what type of pain. The US, Europe, and Japan are entering Muddle Through World. The rest of the world is faced with increased volatility. This is a tough environment in which to be a central banker.

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The Indian context
"Inaction may be India's solution" - Financial Times. Though humorous it speaks volumes about the difficulties in fighting price rise in a country which is very sensitive to price rise and which is going for an election next year. The ADB cautions that rising inflation could also hit investment and corporate earnings, and destabilise governments in Asia.

Annual inflation in India rose to 8.75% for the week ended May 31
, 2008 which is a 7-year high. There is a consensus view that the near-term battle against inflation in India has been lost and inflation is likely to settle down around 9-10% in the near-term. So, the struggle has now shifted to how to bring it under control in the medium-term. And this is after taking up short-term administrative measures to try to stop price rises, including cutting import duties on edible oils, fuels and other food items, introducing export curbs on essential items and suspending futures trading in staple foods such as rice and wheat.

Interestingly, inspite of these measures, there is a view that the Government will not be able to stop
it from accelerating beyond 10%. The only consolation (if at all we can call it that way) is that price gains in neighboring Pakistan accelerated to 19.3% in May, the highest in 30 years. Inflation in Vietnam was 25.2% in the same month, the fastest since 1992, and in Indonesia consumer prices jumped 10.4% from a year ago. But this is no consolation. In a democratic country, where elections are due next year, the poor are more likely to vote, with anger, at the extra-ordinary increase in prices of essential day-to-day consumption items.

Major steel producers decided to reduce prices by Rs 4,000 a tonne after meeting the Prime Minister Manmohan Singh on May 7, 2008. Some cement companies have also announced Rs 3 to Rs 7.5 reduction on a bag of 50 kg. However, it is believed that the government persuasion which lead the commodity manufacturers to reduce prices may not have long lasting effect, as their input costs also are increasing.

While inflation rate at 8.75% has brought out headlines in newspapers crying for immediate action, s
ome economists assert that India's method of calculating inflation is wrong as there are serious flaws in the methodologies used by the government. How does India calculate inflation? And how is it calculated in developed countries? India uses the Wholesale Price Index (WPI) to calculate and then decide the inflation rate in the economy. Most developed countries use the Consumer Price Index (CPI) to calculate inflation. As a common man, I am a witness to the phenomenal increase in all items of daily use, which unfortunately doesn't reflect in the 8.75% inflation rate. To me, the inflation rate clearly appears to be understated. Thus, the actual inflation rate is expected to be much higher than what the official figures indicate.

As an outs
ide observer, I believe that the Reserve Bank of India (RBI), is currently caught between two divergent objectives viz., currency rate management and inflation targeting. The appreciation in the Indian rupee which was happening, suddenly reversed trend and the rupee has gone back from around Rs.39 (for 1 USD) to around Rs.43 (for 1 USD) in a relatively short span of time. May be the outcry from export sensitive sectors employing large number of labour in concentrated locations / industry segments forced the Government to nudge RBI to allow the Indian rupee to depreciate vis-a-vis the USD. But it has also bloated the petroleum bill.

Today, we are at a situation where a very large segment of the population is suffering from the impact of inflation (which is the cruelest form of tax on the poor). May be allowing the currency to increase could be one of tools to use against inflation. How does it matter to the Aam aadmi that sensex is rising or falling?
As of now, the situation is clearly unsatisfactory. Whip Inflation Now, is the message for politicians.

Venture Capital, Before High Tech

Highlights from an
interesting piece in New York Times.

THE United States military — credited with spawning the Internet — also helped in the genesis of venture capital. So reveals Spencer E. Ante in “Creative Capital” (Harvard Business School Press, $35), a sometimes slow but ultimately satisfying biography of Georges F. Doriot, the transplanted Frenchman who is often called the father of V.C. Doriot, a United States Army reserve officer who rose to brigadier general, was appointed an administrator - entrepreneur on the home front, responsible for equipping, clothing and feeding millions of soldiers overseas. He and his staff, including many of his students from Harvard, funded research into innovative solutions. A lightweight plastic flak jacket (the Doron) saved thousands of lives. And even some failures had their upsides. Grunts found their powdered lemonade “useful as stove cleaner or hair rinse.”

The book’s matter-of-fact storytelling is not always as superb as the story, but as the book advances it gathers poignancy. Doriot had won the hand of his Harvard-assigned research assistant, Edna Blanche Allen, a brainy beauty. Their 48-year marriage was childless; Harvard men were surrogate sons. Edna had a dream house built for the couple on the Massachusetts shore, then died of lymphoma; her ashes were scattered into the ocean. Doriot kept writing her love poems. Nine years later, in 1987, the pipe-smoking general succumbed to lung cancer. His ashes were cast from the same spot into the Atlantic. DORIOT’S charismatic, French-accented lectures at Harvard over 40 years inspired multiple generations of leaders with firsthand stories and pithy sayings — for example, “Someone somewhere is making a product that will make your product obsolete.” His cause, venture, became ubiquitous, even in philanthropy.

“Someone somewhere is making a product that will make your product obsolete.” - Georges F. Doriot

A Letter to Facebook’s Founder

Deal Professor Steven M Davidoff in an open letter to Facebook's founder - Mark Zuckerberg highlights some important rights which Venture Capitalists normally enjoy when they fund companies. Highlights from the letter -

"I read with great interest your recent interview with Kara Swisher at the D6 Conference. I was particularly struck by your answer to Ms. Swisher’s question about whether Facebook, the popular social networking site you created, can be sold by your venture capital co-owners without your approval. Your response: “I don’t think so.” Your answer made me think of something my own professor at London Business School once said to me: “The day you take a venture capital investment is the day you sell your company.” Venture capital firms are not Warren Buffett — they have limited-term funds and compensation mechanisms that encourage them to exit their transactions once a company reaches maturity. So, is it true that your co-owners can sell without you or otherwise push through an initial public offering of Facebook without your approval as chief executive officer? Well, the answer is maybe."

While the founder said "I don't think so", the Professor says "Maybe". Why is it so? Mainly because of the legal covenants which normally accompany every VC investment. One of the important right is the drag along right. Accordingly to Investopedia a drag along right is "a right that enables a majority shareholder to force a minority shareholder to join in the sale of a company. The majority owner doing the dragging must give the minority shareholder the same price, terms, and conditions as any other seller. This is designed to protect the majority shareholder. Because some buyers are only looking to have complete control of a company, drag-along rights help to eliminate minority owners and sell 100% of a company's securities to the buyer." This issue is explained further in Feld Thoughts.

The Indian Context

In the Indian context, I don't know whether these are practically possible. May be amongst hundreds of transactions, a few might have actually happened when the founder(s) also are inclined to sell out. In a country where the promoters vision starts and ends with their family, and with lax compliance/enforcement environment (notwithstanding the numerous Acts which have been passed regularly by the Central & State legislatures) and a genuine fear that its better to avoid going to Courts for enforcing rights - the current thinking is that it may take around 15 - 20 years (assuming it goes all the way upto Supreme Court) to get justice and even if something positive comes, will there be anything left to implement / salvage .... All these factors inhibit legal recourse and push people towards an amicable out-of-court settlement.

Interestingly, while everyone talks about the multi-baggers that they have had in their portfolio, hardly anyone actually shares information on investments which went sour. There is also a prevailing wisdom that losers come first and its better to concentrate on winners rather than losers. Thus, even in cases involving losers, though the agreement may provide for various rights, still the VCs might prefer not to exercise them, and would rather try to limit the loss/damage and try to get as much as possible and as quickly as possible. In that event, if the founder(s) are not so honest people, they can make use of this general thinking and try to limit the exit proceeds as low as possible, but not so low that the VC would think it is better to go to court to enforce the agreement.

It might be possible and more effective to enforce the rights enshrined in the agreement where there is a separation of ownership and management. In the Indian context, that (generally speaking) does not appear to be the case, thus frightening potential buyers (mainly due to poor corporate governance standards, especially in smaller firms where the distinction between the owner and the company is often blurred). To that extent, though Indian VCs too have same / similar rights, I doubt how many of these rights are actually exercised and enforced.

Secret Life of a Deal

Highlights from an interesting article in New York Times by ANDREW ROSS SORKIN -

"An enormous cast of characters from Wall Street worked for months — some behind the backs of their own clients — to pursue a deal. The list of big names may surprise you: Henry R. Kravis of Kohlberg Kravis Roberts, Peter A. Weinberg of Perella Weinberg (formerly of Goldman Sachs), Martin Lipton of Wachtell, Lipton, Rosen & Katz and yes, the man of the moment, James Dimon of JPMorgan Chase. As Dow Chemical tells the story — at this point, its version is the more credible — the plot started in the fall of 2006. The plan was to overthrow Dow Chemical’s chief executive, Andrew N. Liveris, and replace him with Mr. Reinhard and Mr. Kreinberg after the buyout. In the space of several months, the plotters lined up financing from the Sultanate of Oman. JPMorgan, which long considered Dow Chemical a client, seems to be in a terrible spot in this story. Perhaps the bank was duped — as it now claims. But it sure doesn’t seem that way from the now-disclosed documents. They show that the bank eagerly pursued the deal even though at least some of its top bankers knew full well that Dow Chemical’s board was not on board. JPMorgan executives met with Mr. Kreinberg and Mr. Reinhard in secret at a hotel, the Compleat Angler, 40 miles outside London. A JPMorgan e-mail message said the participants had “hired entire hotel for confidentiality.” It was only after that meeting that Mr. Winters determined that “‘management’ is not on board but rather a potentially rogue element." And still JPMorgan continued to work on the transaction, and “pitched the transaction to K.K.R. on March 13 and to TPG on March 14.” It was only once news reports about a possible deal emerged — and Dow contacted JPMorgan — that it stopped working on the deal. That is also when everything unraveled."

The Indian Context
Interestingly, Reliance Industries tried to do a Joint Venture with Dow. Both sides were believed to be discussing a possible $20-billion JV in which Reliance could take 59% stake. Dow’s basic chemicals and plastics businesses were expected to be spun off into a separate company in which Reliance which already uses Dow technology at its petrochemicals facilities was to pick up stake. The joint venture was expected to set up manufacturing and R & D facilities in low cost locations with Dow handling the customer front. It made sense for Reliance as it
wanted to be able to team up with buyers who will guarantee offtake of polymers that it produces. But the PE bid for Dow was expected to ruin Reliance's plans and analysts were worried. May be that's why its said that the best-laid plans of mice and men often go awry. All in all, an uncertain world.

Saturday, June 14, 2008

Financial speculators and ban on futures trading

"In Washington, financial speculators are being blamed for high gas prices, soaring grocery bills and volatile commodity markets, and lawmakers are lashing out at market regulators for not cracking down on them more vigorously," says this article in New York Times. Even billionaire George Soros, has said that speculation has spurred the rise in crude prices. The phenomenal increase in the commodity prices have turned the attention of the authorities on the speculators who are otherwise viewed as performing an important function by bringing liquidity to the market.

The Indian Context
The runaway price rise in India has prompted the authorities to extend
ban on futures trading in respect of some commodities to cool prices. But Chairman of the Forward Markets Commission, B.C. Khatua, says the ban on futures trading in some agri commodities is resulting in illegal or ‘dabba’ trading. Interestingly, earlier some traders' groups themselves sought delivery-based forward trading (instead of futures trading), a system that will considerably prevent large scale flow of speculative funds chasing commodities in genuine short supply.

Mint says that instead of taming inflation, futures ban has seen prices rising and may result in illegal trade and hoarding. An article in Mint argues that the current trend of rising prices has put a question mark on the role of futures markets in fuelling inflationary tendencies in the economy. As less than 2% of farmers were aware of the futures market, leave alone participating in it, the general belief is that it is the speculators who are participating and influencing inflationary trends. Unfortunately, the signals which policy makers would otherwise get by the functioning of a well established futures market, would now not be available for the policy makers. As far as India is concerned, my feeling is that conclusive evidence that only speculators are the reason for the price rise is yet to come, though too many people including politicians, bureaucrats and strangely even traders groups themselves have blamed it all on speculators.

Bottlemania: How Water Went on Sale and Why We Bought It

Highlights from a book review by Lisa Margonelli in New York Times. Lisa Margonelli is an Irvine fellow at the New America Foundation and the author of “Oil on the Brain: Petroleum’s Long Strange Trip to Your Tank.”
  • Why did Americans spend nearly $11 billion on bottled water in 2006, when we could have guzzled tap water at up to about one ten-thousandth the cost? The facile answer is marketing, marketing and more marketing, but Elizabeth Royte goes much deeper into the drink in “Bottlemania: How Water Went on Sale and Why We Bought It,” streaming trends cultural, economic, political and hydrological into an engaging investigation of an unexpectedly murky substance.
  • In 1987, Americans drank only 5.7 gallons of bottled water per person per year, but the cumulative impact of ad campaigns and the vision of Madonna fellating a bottle of Evian in “Truth or Dare” more than doubled consumption by 1997. In 2000 the chief executive of Quaker Oats bragged to analysts that “the biggest enemy is tap water.” By 2005, the enemy had become the consumer’s bladder; and in 2006, Pepsi, which owns Aquafina, spent $20 million suggesting that Americans “drink more water.” That year we drank 27.6 gallons each at a rate of about a billion bottles a week.
  • But marketing swings both ways. As quickly as bottled water became a symbol of healthy hyperindividualism — sort of an iPod for your kidneys — a backlash turned it into the devil’s drink. one expert tells Royte, “the total energy required for every bottle’s production, transport and disposal is equivalent, on average, to filling that bottle a quarter of the way with oil.” Mayors from San Francisco to New York suddenly became aware of the new symbolism of bottled water as a waste of taxpayer money, a diss of local tap water and a threat to the environment. Some canceled their city’s bottled water contracts.
  • By the time I finished “Bottlemania” I thought twice about drinking any water. Among the risks: arsenic, gasoline additives, 82 different pharmaceuticals, fertilizer runoff sufficient to raise nitrate levels so that Iowa communities issue “blue baby” alerts. And in 42 states, Royte notes, “people drink tap water that contains at least 10 different pollutants on the same day.” The privatization of pristine water is part of a larger story, a tragic failure to steward our shared destiny. And if you think buying water will protect you, Royte points out that it too is loosely regulated. And there is more — the dangers of pipes and of plastic bottles, the hazards of filters, and yes, that “toilet to tap” issue. But there is slim comfort: Royte says we don’t really need to drink eight glasses of water a day. Drink when you’re thirsty, an expert says. That’s refreshing.
The Indian Context
This book review caught my attention for various reasons. The protests that erupted in the State of Kerala over excessive water use leading to depletion of ground water resources in the local community is still fresh in the mind. The second issue that comes to mind is the study made by Delhi-based NGO, Centre for Science and Environment (CSE), headed by Ms Sunita Narain, revealing that all soft drink brands sold by Coke and Pepsi comprised a cocktail of pesticide residues. This had forced some of the State Governments to restrict sales of cola
products. Further, Coca Cola was also in the news being accused of disposing hazardous sludge outside its bottling plant in Palakkad, Kerala.

In the Indian context, people use bottled water especially while travelling, more for health considerations as tap water is considered not safe enough to drink without purification/boiling etc. Thus, many people while travelling consume Coke/Pepsi feeling that its safe - but which subsequent tests proved not so safe. As regards the bottled water, it was interesting to learn recently from a conversation I had with a person who had visited a water bottling plant. He had been told that bacteria is eliminated at the plant stage while bottling, but it develops/grows after 4-5 hours. Thus, even bottled drinking water is not safe, this person was told! But, as we know our Indian conditions, we still feel bottled water is safe - may be, continuous advertisements have reinforced that thought in our minds.

"Drink when you’re thirsty, an expert says. That’s refreshing," concludes the book review. Very true. Only the question is which water - bottled water or tap water? May be if we are at home, tap water - duly boiled would be good for consumption and if we are travelling then we will have no alternative but to consume bottled water.

Lost in E-Mail, Tech Firms Face Self-Made Beast

The onslaught of cellphone calls and e-mail and instant messages is fracturing attention spans and hurting productivity says MATT RICHTEL in this informative article in New York Times. Some highlights from the article -
  • Intel found in an eight-month internal study that some employees who were encouraged to limit digital interruptions said they were more productive and creative as a result.
  • The fractured attention comes at a cost. In the United States, more than $650 billion a year in productivity is lost because of unnecessary interruptions, predominately mundane matters, according to Basex. The firm says that a big chunk of that cost comes from the time it takes people to recover from an interruption and get back to work.
  • The E-Mail Addict feature in Gmail is more of a blunt instrument. Clicking the “Take a break” link turns the screen gray, and a message reads: “Take a walk, get some real work done, or have a snack. We’ll be back in 15 minutes!”
Cell phones and e-mails have taken a good chunk of time. In the Indian context, with the law enforcement being lax, too many marketing calls / SMSs tend to disturb and distract out attention, even if we have registered for "Do Not Disturb". On the issue relating to e-mails, I was fascinated by the "zero e-mail Fridays" experimented by Intel. One problem which I had seen/experienced was that there is always some urgency to respond - in the process "thinking time" is less and I guess we are making more mistakes than what we would have done had we used the old written (I mean paper) communication.

Oh Jerry, It’s No Longer Your Baby

Young entreprenuers get an innovative idea which also gets funded. They grow the business and at some stage the Company also goes public. In the Indian context, there may not be too many companies where promoters hold minor stakes, though Groups like Tatas have run their companies with minority stakes. If the promoter owns non-dominant stake in the company which he helped found, will he still let go of management control? Yahoo is an example in recent times. Microsoft's Yahoo bid(s) get rebuffed - reasons are given why the offer is low etc. But are they the true reasons for rejecting the offer or is it loss of identity/control over the company which Jerry helped found is the reason. What's the future of the company? Does joining hands with Google the better answer, rather than joining hands with Microsoft?

"Jerry, you’re a billionaire because people all over the world bought your stock, and trusted you to do right by them. That’s the compact you make when you take a company public: you get to be really rich, but in return, you have an obligation to do everything you can to ensure that shareholders get a healthy return on their investment. It doesn’t matter that you would like Yahoo to remain independent, or that you can’t stand Microsoft. Your feelings aren’t supposed to get in the way of your fiduciary duty," says JOE NOCERA in this open letter to Jerry Yang in New York Times.

I feel this is applicable for many Indian businesses too, where owners also double up as managers of businesses and refuse to let go management control (into competent / professional hands), both in their interest as also in the interest of all shareholders.

How Does Your Waist Measure Up?

Is there a link between the size of waist and health? Yes, says this interesting article in New York Times. Some highlights from the article -

Studies suggest that health risks begin to increase when a woman’s waist reaches 31.5 inches, and her risk jumps substantially once her waist expands to 35 inches or more. For a man, risk starts to climb at 37 inches, but it becomes a bigger worry once his waist reaches or exceeds 40 inches. Last month, The International Journal of Obesity suggested that, particularly for young people, the waist-to-height ratio might be a better indicator of overall health risks. Put simply, your waist should be less than half your height.

Experts Revive Debate Over Cellphones and Cancer

What started as a status symbol in India has slowly transformed into a necessity for all. I am talking about the cell phone. It has reached a stage where even vegetable vendors, auto rickshaw drivers, school children,... you name a segment and you will find them using the mobile phones. India, has become a market with lowest tariffs and this has helped in growing the market by leaps and bounds. But it has its side effects too, as this New York Times articles points out.

What do brain surgeons know about cellphone safety that the rest of us don’t, asks TARA PARKER-POPE in this interesting article in New York Times. The article says that three prominent neurosurgeons had told the CNN interviewer Larry King that they did not hold cellphones next to their ears. Again, the American Journal of Epidemiology had published data from Israel finding a 58 percent higher risk of parotid gland tumors among heavy cellphone users. Also last year, a Swedish analysis of 16 studies in the journal Occupational and Environmental Medicine showed a doubling of risk for acoustic neuroma and glioma after 10 years of heavy cellphone use. The real concern, some doctors say, is not older cellphone users, who began using phones as adults, but children who are beginning to use phones today and face a lifetime of exposure.

Better to be safe, rather than feel sorry later. Its time that India too conducts some study to find if there are linkages between cell usage and ill health. Pending that it can atleast conduct an educational campaign using the mass media to suggest alternate (or) better and safe ways of using cell phones.