Face-Off with Students from The Walton College of Business

It’s the night before we meet our exchange students from the Walton College of Business (WCOB), USA. I am eager and nervous to meet them.  There are a number of things to learn about them, their country, and many questions pop in my head in anticipation.  But first, I have to introduce myself as a cool dude…so I practice…

”Hey friends my name is Dhruv….. Hey!! I am Dhruv…. Hi, nice to meet you, I am Dhruv”… Thinking…Still thinking…adjusting my sunglasses… Aahhh. Maybe I should change the ‘Dhruv’ to ‘Dhruvy’…Like they always change their names –‘Elizabeth’ becomes ‘Liz’, ‘Richard’ becomes ‘Dick’ and ‘Thomas’ becomes ‘Tom’.

A week before their arrival, we were divided into groups and an informal session had already begun over emails and facebook. Not just the FIIB students, but the WCOB students were equally eager to meet us. The groups had four to five students with a mix of students from both FIIB and WCOB. My group constituted of Ravi and Shreesti from FIIB, and Todd, Marcus and Caitlin from WCOB.

Our journey was an amazing one – it took us from the crowded streets of Chandni Chowk to the plush and exquisite interiors of the Emporio Mall.  Our conversations over this 2-day period were very deep and vast.  I have tried to include them here with a prologue on my thought process for each issue I have reported (included below in square brackets).

However, at first, I am totally appreciative about my foreign mates’ curiosity and drive to know more about India, its people, the culture, religions, economy, and politics.  Despite the blistering 44-degrees, they kept the conversation going enthusiastically in the rickshaw, in the metro, in the cramped car.  Read on for their responses to some of my questions aimed at understanding them and their American context better…

[Each group was given a topic to study and research on, and our group had to prepare on the income levels of India. With this I started my first question]

Dhruv: So what do you understand by the income levels of India and what are they going to help you achieve?

Todd: The project consists of us understanding about the different income levels or the income groups of India and what an American company needs to learn about the perception of an Indian consumer. The two places we visited, Sarojni Nagar and South Ex are contrasting in every sense.  Sarojni has Shirts available at an average price of Rs. 150 while South Ex which usually has American companies sells a Shirt at an average price of Rs.850. Even though an American would prefer the Rs 850 shirt over the Rs 150, because of the quality, most of the Indians would choose the opposite. It is not because quality doesn’t matter to the Indians, it’s because most of the Indians fall in an income group which leaves them with no option except Sarojni.

­[Recently I read an article which stated that the Federal Bank of US is trying to pump in money into its economy by reducing the interest rates and trying to boost the U.S. economy. However the article did give me a brief, but I wasn’t completely satisfied by it. So I thought of asking.]

Dhruv: Hey I have heard that the U.S. Federal Bank is trying to increase the inflow of money….?

Before I could complete my question, Marcus was all over it. Here’s how it went.

Marcus: In America the interest rates are as low as half a percent or even less. Hence people were investing into gold and this was not just causing a reduction in the investments but also a fall in the US Dollar as dollar and gold are inversely proportional.  Yes the Federal Bank of U.S. is trying to pump in money in the economy, and this process is called Quantitative Easing. In this process, the government tries to increase the money supply by buying government securities or other securities from the market, thus pumping in capital in the economy, which will later not just boost the stock market but also the US Dollar. This was the major reason why gold prices have fallen.

[The Prime Minister of India, Dr. Manmohan Singh, lately removed the burden of loans (crores of it) from the Indian farmers which were given to them when the last elections were held. This has greatly increased the deficit and buried India under it. With this, I came to politics in U.S. and their thoughts on it. And to my surprise, the things I got to know were completely different from what I had thought.]

Dhruv: So what are your views on the U.S. politics, the scenario of the republicans and the democrats, and whether Obama has been a hero for them and for America?

Jenna, Alley and Alex: We are republicans.

[And this sentence just hit me, because with democrats leading, Obama himself being a democrat, I thought most of the people would have said democrat.]

 Jenna: The scenario as of now between the democrats and the republicans is not so intense, as it was a couple of months before.

Alley: The North and the Eastern Americans usually support the republicans while the democrats are supported by the South and the Western Americans.

Alex: Obama hasn’t been as successful as the voices, which have reached a thousand ears. I do appreciate that he has improved the healthcare system, but the improvement has been at the cost of cut in taxes, fall in interest rates, ailment in the economy.

Alley: The republicans are to the point i.e. pay taxes, increase the interest rates and they would invest in defense, in infrastructure, in the development of the country, and of course focusing on the healthcare and the education sector as well.

Jenna: Obama should stand for the country, instead of just focusing on a particular area, should focus on the whole economy.

[In our Macroeconomics lecture, Prof. Kumar uses a phrase quite often, “When US sneezes India catches cold”. This made way to my next question. The global downturn in 2009. ]

 Dhruv:  The US economy has seen one of its worst times after the global crisis. How do you think US will be able to re-establish itself?

Mary: As Marcus had already discussed about the concept of Quantitative Easing, that would shortly be my answer to the question. In 2001, Japan had faced similar crisis, where its economy was stagnant with the Yen going weak and a rise in the unemployment.  USA is in a similar situation and to counter the same, a few bold steps have been taken by Obama like putting pressures on the interest rates, increasing the money supply which would further boost the stock market and thus would trickle down in helping the companies revive and the economy stabilize.(Without realizing that this might boost the inflation as well). The pressure on USA has doubled from just reviving its economy to competing with the next superpower- China.

My questions didn’t end here, but unfortunately the two days did. I must appreciate the patience with which they answered my questions and have promised to continue the same when they head back home. I was lucky enough to be a part of this amazing program. I made some very good friends and have memories of a lifetime.