Green IT refers to,
> Environmentally sustainable computing of IT.
> It is "the study and practice of designing, manufacturing, using, and disposing of computers, servers, and associated subsystems—such as monitors, printers, storage devices, and networking and communications systems—efficiently and effectively with minimal or no impact on the environment.
Why go green?
With increasing recognition that man-made greenhouse gas emissions are a major contributing factor to global warming, enterprises, governments, and society at large now have an important new agenda: tackling environmental issues and adopting environmentally sound practices.
Greening our IT products, applications, services, and practices is an economic and an environmental imperative, as well as our social responsibility.
Reduce the use of hazardous materials, maximize energy efficiency during the product's lifetime, and promote recyclability or biodegradability of defunct products and factory waste.
Rising energy prices, together with government-imposed levies on carbon production, are increasingly impacting on the cost of doing business, making many current business practices economically unsustainable.
- To enhance the brand and to improve corporate image.
The problem
- Energy crunch and high cost in producing it.
- Most of the traditional means of generating energy are environmentally non friendly.
- Development and improvements in technology including hardware and software have largely been achieved without regard to energy consumption.
- Means of disposal of computers, servers, and associated subsystems—such as monitors, printers, storage devices, and networking and communications systems impacting the environment a lot.
- Not many are thinking on reusability of systems or subsystems.
- The threat of recession tightening not only our budgets, but also our customers' budgets;
- Increased pressure around ROI - again within our brand and among our customers.
- A widening set of geographies to reach and manage.
Roads to Green Computing
Green use — reducing the energy consumption of computers and other information systems as well as using them in an environmentally sound manner.
Green disposal — refurbishing and reusing old computers and properly recycling unwanted computers and other electronic equipment.
Green design — designing energy-efficient and environmentally sound components, computers, servers, cooling equipment, and data centers
Green manufacturing — manufacturing electronic components, computers, and other associated subsystems with minimal impact on the environment
These four paths span a number of focus areas and activities, including
- design for environmental sustainability
- energy-efficient computing
- power management
- data center design, layout, and location
-server virtualization
- responsible disposal and recycling
- regulatory compliance
- green metrics, assessment tools, and methodology
- environment-related risk mitigation
- use of renewable energy sources and eco-labeling of IT products
Approaches to green computing
Algorithmic efficiency
The efficiency of algorithms has an impact on the amount of computer resources required for any given computing function and there are many efficiency trade-offs in writing programs.
A study by Alex Wissner-Gross, a physicist at Harvard, estimated that the average Google search released 7 grams of carbon dioxide (CO2). However, Google disputes this figure, arguing instead that a typical search produces only 0.2 grams of CO2. So the energy consumed to run a program can vary on the efficiency of the algorithms.
Virtualization
Computer virtualization refers to the abstraction of computer resources, such as the process of running two or more logical computer systems on one set of physical hardware.
With virtualization, a system administrator could combine several physical systems into virtual machines on one single, powerful system, thereby unplugging the original hardware and reducing power and cooling consumption.
Terminal Servers
When using terminal servers, users connect to a central server; all of the computing is done at the server level but the end user experiences the operating system.
These can be combined with thin clients, which use up to 1/8 the amount of energy of a normal workstation, resulting in a decrease of energy costs and consumption.
Power management
The Advanced Configuration and Power Interface (ACPI), an open industry standard, allows an operating system to directly control the power saving aspects of its underlying hardware.
This allows a system to automatically turn off components such as monitors and hard drives after set periods of inactivity.
Some programs allow the user to manually adjust the voltages supplied to the CPU, which reduces both the amount of heat produced and electricity consumed. This process is called undervolting.
Some CPUs can automatically under volt the processor depending on the workload; this technology is called "SpeedStep" on Intel processors, "PowerNow!"/"Cool'n'Quiet" on AMD chips, LongHaul on VIA CPUs, and LongRun with Transmeta processors.
Recently there is a new solution area emerging, that provides tools to automatically minimize the power consumption of computers in corporate or educational networks by monitoring computer activity and putting computers into power saving modes if they are idle.
Power supply
Desktop computer power supplies (PSUs) are generally 70–75% efficient, dissipating the remaining energy as heat.
An industry initiative called 80 PLUS certifies PSUs that are at least 80% efficient; typically these models are drop-in replacements for older, less efficient PSUs of the same form factor.
As of July 20, 2007, all new Energy Star 4.0-certified desktop PSUs must be at least 80% efficient.
Storage
Smaller form factor (e.g. 2.5 inch) hard disk drives often consume less power per gigabyte than physically larger drives.
Unlike hard disk drives, solid-state drives store data in flash memory or DRAM. With no moving parts, power consumption may be reduced somewhat for low capacity flash based devices.
In a recent case study Fusion-io, manufacturers of the world's fastest Solid State Storage devices, managed to reduce the carbon footprint and operating costs of MySpace data centers by 80% while increasing performance speeds beyond that which is was attainable by multiple hard disk drives in Raid 0. In response, MySpace was able to permanently retire several of their servers, including all heavy-load servers, further reducing their carbon footprint.
As hard drive prices have fallen, storage farms have tended to increase in capacity to make more data available online. This includes archival and backup data that would formerly have been saved on tape or other offline storage.
The increase in online storage has increased power consumption. Reducing the power consumed by large storage arrays, while still providing the benefits of online storage, is a subject of ongoing research.
Video Card
A fast GPU may be the largest power consumer in a computer.
Energy efficient display options include:
1. No video card - use a shared terminal, shared thin client, or desktop sharing software if display required.
2. Use motherboard video output - typically low 3D performance and low power.
3. Select a GPU based on average wattage or performance per watt.
Display
Some newer displays use an array of light-emitting diodes (LEDs) in place of the fluorescent bulb, which reduces the amount of electricity used by the display.
Operating system issues
Due to Microsoft's dominance of the huge desktop operating system market this may have resulted in more energy waste than any other initiative by other vendors.
Microsoft Windows Vista has improved this by adding basic central power management configuration. The basic support offered has been unpopular with system administrators who want to change policy to meet changing user requirements or schedules.
Several software products have been developed to fill this gap including Auto Shutdown Manager, Data Synergy PowerMAN, Faronics Power Save, 1E NightWatchman, Verdiem Surveyor/Edison, Verismic Power Manager, WakeupOnStandBy (WOSB), TOff and Greentrac (also promotes behavioral change) among others.
Materials recycling/ Dematerialisation
Recycling computing equipment can keep harmful materials such as lead, mercury, and hexavalent chromium out of landfills, but often computers gathered through recycling drives are shipped to developing countries where environmental standards are less strict than in North America and Europe.
Computing supplies, such as printer cartridges, paper, and batteries may be recycled as well.
The substitution of high carbon products and activities with low carbon alternatives e.g. paper with e-billing – could play a substantial role in reducing emissions.
Online billing, media and music, replacing paper and CDs all reduce the emissions associated with their manufacture and distribution.
Attractive offers that allow service upgrades without trading the phone/computer in are already increasing the life of the mobile/computer device itself.
For example, A global closed-loop reverse supply chain has enabled Cisco to collect nearly 24 million pounds of returned electronic equipment, more than 99 percent of which was recycled or reused. The networking giant offers a discount on new products in exchange for returned equipment. Redeploying that unwanted equipment saved Cisco $153 million in fiscal 2009, the company said in its just-released Corporate Social Responsibility report.
Telecommuting
Teleconferencing and telepresence technologies are often implemented in green computing initiatives.
The advantages are many; increased worker satisfaction, reduction of greenhouse gas emissions related to travel, and increased profit margins as a result of lower overhead costs for office space, heat, lighting, etc.
Reducing data centre emissions
Higher adoption rates of virtualization architectures and low energy cooling would help achieve step changes in efficiency.
Data centre location to reduce cooling needs. For example, Google is constructing a data center near a sea shore which according to them will reduce the energy and cost in cooling off their data center.
At the Supercomputing 2009 conferencing, Iceotope unveiled a new technology to allow servers to be cooled by immersion in water, a new design that the company estimates could cut energy used to cool data centers by as much as 93 percent.
Green power generation
Companies can do this by purchasing renewable electricity, by installing renewable generation on their sites and by making renewable electricity integral to their products.
In fact, the sector is uniquely placed to partner with power companies to optimize the existing electricity grid to allow more efficient power distribution and enable the use of more renewable or green power.
For example, an £80m (US $130.3 million) green data center under construction in east London will use 9 megawatts (MW) of surplus heat created by racks of servers to power residential and business properties in the surrounding area.
As well as capturing waste heat for re-use, the site will also feature a solar array designed to provide the facility with 6,000 kWh of power a year.
With the installation of a 500 kilowatt wind turbine on its manufacturing facility, Other World Computing says it is the world's first 100 percent wind-powered IT Company. The wind turbine will generate an estimated 1.2 million kilowatt-hours of energy per year, which is more than double the amount OWC says it needs to power its LEED Platinum facility and data center.
It's a corporate responsibility towards the society and it's also a smart way of doing business which in turn proves to be an economic in it's model. So go green is a new mantra everyone is talking and practicing now days.
Cheers,
Vijay...
Thursday, February 25, 2010
Green - A business model
Green is in every aspect of our life. We all are talking about green today more than ever in the past. Amazingly even doctors talk about including green foods in your diet for a healthy life. Talk to automakers, they talk about future generation green cars. Talk to food industrialist, they talk about benefits of organic food. Talk to IT or ITC leaders, they talk about green computing or green ITC. Today you open a news paper, magazine or switch on a news channel, listen to an interview you get to see or listen to this topic. Well, is it become an issue of sentiment or a concern or a business model to market your products? I think it’s a bit of all. Please bear to read my post in detail and then judge me but don’t be very harsh in judging me :)
Every one knows the reason behind global warming. And the reasons in brief are,
- Natural causes
- Deforestation
- Excess GHG emission.
Ok, what exactly green refer to? I think its better I clarify what green means to different people.
In the United States of America, green is a slang term for money, among other things.
Green has broad and sometimes contradictory meanings. In some cultures, green symbolizes hope and growth, while in others; it is associated with death, sickness, envy, or the devil. The most common associations, however, are found in its ties to nature. For example, Islam venerates the color, as it expects paradise to be full of lush greenery. Green is also associated with regeneration, fertility and rebirth for its connections to nature. Recent political groups have taken on the color as symbol of environmental protection and social justice, and consider themselves part of the Green movement, some naming themselves Green parties. This has led to similar campaigns in advertising, as companies have sold green, or environmentally friendly, products.
Many environmentalists, leaders, scientists are fearing that with the current rate of increase in population, deforestation, excess and toxic GHG emissions there are lot of risks to this earth and in a whole to this mankind. Well, I say before we experience the threat from mother earth half of our population will be reduced due to shortage in food, wars between countries, complicated diseases etc. Consider nothing of such issues like food, war, disease will happen and we experience the difficult issue of global warming alone.
There have been at least five major ice ages in the Earth's past. Outside these ages, the Earth seems to have been ice-free even in high latitudes.
Rocks from the earliest well established ice age, called the Huronian, formed around 2.4 to 2.1 Ga (billion) years ago during the early Proterozoic Eon.
The next well-documented ice age, and probably the most severe of the last billion years, occurred from 850 to 630 million years ago.
A minor ice age, the Andean-Saharan, occurred from 460 to 430 million years ago, during the Late Ordovician and the Silurian period.
There were extensive polar ice caps at intervals from 350 to 260 million years ago in South Africa during the Carboniferous and early Permian Periods, associated with the Karoo Ice Age.
The Karoo Ice Age occurred from 360 to 260 million years ago.
My question is, well before mankind exists and even after man kind came in to picture we had ice age. That time there was no industrialization or no excess GHG emission then how come we seen changes in ice age?
Major reasons quoted are,
atmospheric composition (the concentrations of carbon dioxide, methane); changes in the Earth's orbit around the Sun known as Milankovitch cycles (and possibly the Sun's orbit around the galaxy); the motion of tectonic plates resulting in changes in the relative location and amount of continental and oceanic crust on the Earth's surface, which affect wind and ocean currents; variations in solar output; the orbital dynamics of the Earth-Moon system; and the impact of relatively large meteorites, and volcanism including eruptions of super volcanoes.
Reasons quoted gives a sense that natural causes were the major ones in the process of shift in the global warming. Then why should we worry much about other reasons?
Many intellectuals say, with all these man made excess GHG emissions, deforestation is resulting in accelerating the process of global warming. Makes sense and makes me believe this. Then how badly these reasons contribute to global warming?
Climategate controversy – twisted data from the researchers http://www.washingtonpost.com/wp-dyn/content/article/2009/11/20/AR2009112004093.html, Even me this might give us the fair idea on this. You don’t believe so??? Many agencies, many researchers have contributed lot on this topic to confuse Being a sensible human being we should be listening to good people andus? ensure we follow each step to protect ourselves from horrifying things that can occur. We have seen many deadly tsunami, earth quakes, climate shift, acid rain etc causing the death. So it’s a sentimental issue to us and many vested interests are using this topic to sell their products?
All these years, many products like automotives, computers were concentrating only on speed and efficiency and not minimal use of energy. Now they need to because,
• Rising energy prices, together with government-imposed levies on carbon production, are increasingly impacting on the cost of doing business, making many current business practices economically unsustainable.
• To enhance the brand and to improve corporate image.
• Rising energy costs will have an impact on all businesses, and all businesses will increasingly be judged according to their environmental credentials, by legislators, customers and shareholders.
So it’s all about brand and money with a sense of social-corporate responsibility here.
Its bit complicated when it comes to debating on this issue with respect to different countries. Many countries are producing these, so called GHG in excess and many countries that won’t produce GHG are getting affected by these natural calamities. Why? Even though we are different countries, we all are living in a global village. Here comes the interesting topic – carbon tax, carbon credit, carbon offset, carbon cap, when I read in detail about carbon trade etc which contributed wealth for many these factors in detail it amused me and made me raise so many questions and doubts on such regulations. These are simply money making tools for some and in some cases it's hard for regulators to track the records in general.
No one is against green I believe, but are we in a position to go green and if so where are the solutions? Will they take care of all the problems? Does everyone understand the same green language? Why are we struggling so much to achieve greener globe? Very basic questions worry us in this regard I believe. So when we talk about green and including green products in our lives, we really should evaluate the product in a sense of both economy and sentiment. Simply many are using this topic for their vested interests and if they are going green then it’s viable for them otherwise they wouldn’t have dared to. Everyone is behind calculating ROI and the business behind it :( :(
Today we have higher buildings and wider highways but shorter temperaments and narrower points of view.
We spend more but enjoy less.
We have bigger houses, but smaller families.
We have more compromises but less time.
We have more knowledge but less judgment.
We have more medicines but less health.
We have multiplied our possessions but reduced our values.
We talk much, we love only a little, and we hate too much.
We reached the moon and came back but we find it troublesome to cross our own street and meet our neighbors.
We have conquered outer space but not our inner space.
We have higher income, but fewer morals.
These are times with more liberty, but less joy.
We have much more food but less nutrition.
These are days in which two salaries come home, but divorces increased.
These are times of finer houses, but more broken homes.
Sad but true :( :( :(
Cheers,
Vijay...
Every one knows the reason behind global warming. And the reasons in brief are,
- Natural causes
- Deforestation
- Excess GHG emission.
Ok, what exactly green refer to? I think its better I clarify what green means to different people.
In the United States of America, green is a slang term for money, among other things.
Green has broad and sometimes contradictory meanings. In some cultures, green symbolizes hope and growth, while in others; it is associated with death, sickness, envy, or the devil. The most common associations, however, are found in its ties to nature. For example, Islam venerates the color, as it expects paradise to be full of lush greenery. Green is also associated with regeneration, fertility and rebirth for its connections to nature. Recent political groups have taken on the color as symbol of environmental protection and social justice, and consider themselves part of the Green movement, some naming themselves Green parties. This has led to similar campaigns in advertising, as companies have sold green, or environmentally friendly, products.
Many environmentalists, leaders, scientists are fearing that with the current rate of increase in population, deforestation, excess and toxic GHG emissions there are lot of risks to this earth and in a whole to this mankind. Well, I say before we experience the threat from mother earth half of our population will be reduced due to shortage in food, wars between countries, complicated diseases etc. Consider nothing of such issues like food, war, disease will happen and we experience the difficult issue of global warming alone.
There have been at least five major ice ages in the Earth's past. Outside these ages, the Earth seems to have been ice-free even in high latitudes.
Rocks from the earliest well established ice age, called the Huronian, formed around 2.4 to 2.1 Ga (billion) years ago during the early Proterozoic Eon.
The next well-documented ice age, and probably the most severe of the last billion years, occurred from 850 to 630 million years ago.
A minor ice age, the Andean-Saharan, occurred from 460 to 430 million years ago, during the Late Ordovician and the Silurian period.
There were extensive polar ice caps at intervals from 350 to 260 million years ago in South Africa during the Carboniferous and early Permian Periods, associated with the Karoo Ice Age.
The Karoo Ice Age occurred from 360 to 260 million years ago.
My question is, well before mankind exists and even after man kind came in to picture we had ice age. That time there was no industrialization or no excess GHG emission then how come we seen changes in ice age?
Major reasons quoted are,
atmospheric composition (the concentrations of carbon dioxide, methane); changes in the Earth's orbit around the Sun known as Milankovitch cycles (and possibly the Sun's orbit around the galaxy); the motion of tectonic plates resulting in changes in the relative location and amount of continental and oceanic crust on the Earth's surface, which affect wind and ocean currents; variations in solar output; the orbital dynamics of the Earth-Moon system; and the impact of relatively large meteorites, and volcanism including eruptions of super volcanoes.
Reasons quoted gives a sense that natural causes were the major ones in the process of shift in the global warming. Then why should we worry much about other reasons?
Many intellectuals say, with all these man made excess GHG emissions, deforestation is resulting in accelerating the process of global warming. Makes sense and makes me believe this. Then how badly these reasons contribute to global warming?
Climategate controversy – twisted data from the researchers http://www.washingtonpost.com/wp-dyn/content/article/2009/11/20/AR2009112004093.html, Even me this might give us the fair idea on this. You don’t believe so??? Many agencies, many researchers have contributed lot on this topic to confuse Being a sensible human being we should be listening to good people andus? ensure we follow each step to protect ourselves from horrifying things that can occur. We have seen many deadly tsunami, earth quakes, climate shift, acid rain etc causing the death. So it’s a sentimental issue to us and many vested interests are using this topic to sell their products?
All these years, many products like automotives, computers were concentrating only on speed and efficiency and not minimal use of energy. Now they need to because,
• Rising energy prices, together with government-imposed levies on carbon production, are increasingly impacting on the cost of doing business, making many current business practices economically unsustainable.
• To enhance the brand and to improve corporate image.
• Rising energy costs will have an impact on all businesses, and all businesses will increasingly be judged according to their environmental credentials, by legislators, customers and shareholders.
So it’s all about brand and money with a sense of social-corporate responsibility here.
Its bit complicated when it comes to debating on this issue with respect to different countries. Many countries are producing these, so called GHG in excess and many countries that won’t produce GHG are getting affected by these natural calamities. Why? Even though we are different countries, we all are living in a global village. Here comes the interesting topic – carbon tax, carbon credit, carbon offset, carbon cap, when I read in detail about carbon trade etc which contributed wealth for many these factors in detail it amused me and made me raise so many questions and doubts on such regulations. These are simply money making tools for some and in some cases it's hard for regulators to track the records in general.
No one is against green I believe, but are we in a position to go green and if so where are the solutions? Will they take care of all the problems? Does everyone understand the same green language? Why are we struggling so much to achieve greener globe? Very basic questions worry us in this regard I believe. So when we talk about green and including green products in our lives, we really should evaluate the product in a sense of both economy and sentiment. Simply many are using this topic for their vested interests and if they are going green then it’s viable for them otherwise they wouldn’t have dared to. Everyone is behind calculating ROI and the business behind it :( :(
Today we have higher buildings and wider highways but shorter temperaments and narrower points of view.
We spend more but enjoy less.
We have bigger houses, but smaller families.
We have more compromises but less time.
We have more knowledge but less judgment.
We have more medicines but less health.
We have multiplied our possessions but reduced our values.
We talk much, we love only a little, and we hate too much.
We reached the moon and came back but we find it troublesome to cross our own street and meet our neighbors.
We have conquered outer space but not our inner space.
We have higher income, but fewer morals.
These are times with more liberty, but less joy.
We have much more food but less nutrition.
These are days in which two salaries come home, but divorces increased.
These are times of finer houses, but more broken homes.
Sad but true :( :( :(
Cheers,
Vijay...
Global economic crisis - What exactly is it and how it affected all of us?
Recently my uncle and aunt had been to my place and we were just talking about the things happening in our lives. He asked me "dude, what about marriage? when are you getting married? what are your future plans?". Suddenly i went blank. I told, Hmmm, i am thinking to get marry this year. then he had a smile on his face and said, that's good man. I thought you will marry once you get old enough, hihihi.. Again he said, do you know that now a days parents don't want their daughters to marry a s/w engg? everyone is bothered about their security. and again he gave an example of a family who rejected an offer to marry their daughter to a s/w engg.
Then i said, wow my goodness, That's horrible. There was a time when people wanted a s/w engg as their son in law and even gals wanted a boy who is a s/w engg. I always knew that time changes and good and bad cycles repeat but never expected so fast. Hard time for s/w engg hardly ended in 2004 but never expected it to be more worst than that so soon. Well, that's very bad. Then i asked, so what do you expect me to do now? you don't want me to get married now?
He told, when did i say that? Me: Then what about your story which you just told me?
Uncle: It's all destiny, don't worry. There will be a partner for everybody. You just don't worry.That was like a butter on a hot dosa, which has more holes than normal this time....
Then suddenly he asked, what exactly is a reason for such a situation? what exactly is global recession? when everything will be allright? who is responsible for all of this? Is it because of George W Bush and his wars against terrorism? Then i told him, yes that's also a reason partly and other main reasons are subprime mortgage crisis, mortgage delinquencies and foreclosures in the United States, with major adverse consequences for banks and financial markets around the globe, Mortgage market, Credit risk, Boom and bust in the housing market, High-risk mortgage loans and lending/borrowing practices, Securitization practices, Inaccurate credit ratings,Government policies, Policies of central banks, Financial institution debt levels and incentives, Credit default swaps, Inflow of funds due to trade deficits, Impact in the U.S, Financial market impacts, 2007, Financial market impacts, 2008, Indirect economic effects etc... He was like blind to all this.. Then he said, wow dude i didn't get you.I was bit exhausted after telling all this, even he asked so many questions in between when i was explaining the above points to him. Then it was a challenge for me to make him understand. I told him, just give me 5 mins break and then i will tell you a simple story. Then i scratched my head like anythin and came up with an example which can make him understand very easily. I made sure that he shouldn't ask any questions in between when i tell him the story, which was very simple to understand any person.
Listen to the story:
A person with a monthly income of INR 5000 is happy with his family. This amount is enough for him to lead a comfortable life. Even he was saving INR 1000 and investing in insurance, bank etc. One day a friend of him tells him that, dude why don't you earn some extra money and invest in something that makes you and your family more secure. Then he asks what to do to earn that extra amount. He advices him to buy a cow and start selling milk in the morning and evening. This fellow feels that yeah, this is a good idea and without analysing much he decides to buy a cow and earn that extra amount.He goes to a rich person and asks for a loan and after convincing a lot rich person agrees to lend him money at the rate of 3% interest / month. Even rich person doesn't analyses much like what if he can't pay regularly? Rich person calculates about future like i will get INR 600 interest per month, so i can invest that amount on my sons education. So he sends his son to a good school whose fees is bit higher than what they use to pay before. With the INR 20000 at the rate of 3% interest / month, he takes money and buy a cow from a market. Once he took that cow to his place he looks after it very well and after few days that cow falls sick. He takes it to the doctor and invest some money, and after few days it feel better. But it stops giving milk. Owner thinks that may be it's because of it's health. so he feeds it well and invest money on it's food and some other things. But even after long time, cow doesn't start giving milk.Rich person who lent the money, comes to know that owner of the cow didn't pay his interest nor the capital from last two months. He comes to the owner and asks for the money, and owner tells all the story and tells that he can't repay his money now. Rich person goes mad and feels no other way other than he takes that cow and resell it. He takes that cow and feeds it till he finds a suitable buyer. At last rich person sells that cow to a butcher for INR 3000. And asks the old owner to pay remaining INR 17000 without interest. if he pays that money in installments then he needs to cutdown his monthly expenditure and if he doesn't then rich person loses the capital. This way rich person loses interest plus the interest he would have got from the bank if he would have deposited it in bank, and the extra money he invested in his son's education.Even the person who bought the cow lost some money in looking after the cows daily expenditure and money spent on it's health. This way everyone looses the amount. Every one experienced the recession. On a large scale, this is what a global economic crisis.Then my uncle didn't even ask a single question on this topic. Hope he found the answer appropriate....
Cheers,
Vijay....
Then i said, wow my goodness, That's horrible. There was a time when people wanted a s/w engg as their son in law and even gals wanted a boy who is a s/w engg. I always knew that time changes and good and bad cycles repeat but never expected so fast. Hard time for s/w engg hardly ended in 2004 but never expected it to be more worst than that so soon. Well, that's very bad. Then i asked, so what do you expect me to do now? you don't want me to get married now?
He told, when did i say that? Me: Then what about your story which you just told me?
Uncle: It's all destiny, don't worry. There will be a partner for everybody. You just don't worry.That was like a butter on a hot dosa, which has more holes than normal this time....
Then suddenly he asked, what exactly is a reason for such a situation? what exactly is global recession? when everything will be allright? who is responsible for all of this? Is it because of George W Bush and his wars against terrorism? Then i told him, yes that's also a reason partly and other main reasons are subprime mortgage crisis, mortgage delinquencies and foreclosures in the United States, with major adverse consequences for banks and financial markets around the globe, Mortgage market, Credit risk, Boom and bust in the housing market, High-risk mortgage loans and lending/borrowing practices, Securitization practices, Inaccurate credit ratings,Government policies, Policies of central banks, Financial institution debt levels and incentives, Credit default swaps, Inflow of funds due to trade deficits, Impact in the U.S, Financial market impacts, 2007, Financial market impacts, 2008, Indirect economic effects etc... He was like blind to all this.. Then he said, wow dude i didn't get you.I was bit exhausted after telling all this, even he asked so many questions in between when i was explaining the above points to him. Then it was a challenge for me to make him understand. I told him, just give me 5 mins break and then i will tell you a simple story. Then i scratched my head like anythin and came up with an example which can make him understand very easily. I made sure that he shouldn't ask any questions in between when i tell him the story, which was very simple to understand any person.
Listen to the story:
A person with a monthly income of INR 5000 is happy with his family. This amount is enough for him to lead a comfortable life. Even he was saving INR 1000 and investing in insurance, bank etc. One day a friend of him tells him that, dude why don't you earn some extra money and invest in something that makes you and your family more secure. Then he asks what to do to earn that extra amount. He advices him to buy a cow and start selling milk in the morning and evening. This fellow feels that yeah, this is a good idea and without analysing much he decides to buy a cow and earn that extra amount.He goes to a rich person and asks for a loan and after convincing a lot rich person agrees to lend him money at the rate of 3% interest / month. Even rich person doesn't analyses much like what if he can't pay regularly? Rich person calculates about future like i will get INR 600 interest per month, so i can invest that amount on my sons education. So he sends his son to a good school whose fees is bit higher than what they use to pay before. With the INR 20000 at the rate of 3% interest / month, he takes money and buy a cow from a market. Once he took that cow to his place he looks after it very well and after few days that cow falls sick. He takes it to the doctor and invest some money, and after few days it feel better. But it stops giving milk. Owner thinks that may be it's because of it's health. so he feeds it well and invest money on it's food and some other things. But even after long time, cow doesn't start giving milk.Rich person who lent the money, comes to know that owner of the cow didn't pay his interest nor the capital from last two months. He comes to the owner and asks for the money, and owner tells all the story and tells that he can't repay his money now. Rich person goes mad and feels no other way other than he takes that cow and resell it. He takes that cow and feeds it till he finds a suitable buyer. At last rich person sells that cow to a butcher for INR 3000. And asks the old owner to pay remaining INR 17000 without interest. if he pays that money in installments then he needs to cutdown his monthly expenditure and if he doesn't then rich person loses the capital. This way rich person loses interest plus the interest he would have got from the bank if he would have deposited it in bank, and the extra money he invested in his son's education.Even the person who bought the cow lost some money in looking after the cows daily expenditure and money spent on it's health. This way everyone looses the amount. Every one experienced the recession. On a large scale, this is what a global economic crisis.Then my uncle didn't even ask a single question on this topic. Hope he found the answer appropriate....
Cheers,
Vijay....
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