October 2011
Inside Story What makes great products great
Speed Demon What makes the Formula One machine special
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12
An Insider’s Guide To Rogue Trading Everyone seems to be doing it. Here's how you can, too
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29
New Delhi, Mumbai, Bangalore, Kolkata, Chennai, Ahmedabad, Hyderabad, Chandigarh*, Pune* 
Top Of The Pack Harsha Bhogle on the best cricket matches he has witnessed
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editor’s note
Contents Indulge October 2011
04| Interview
Deconstructions
T
his second issue of Indulge you hold in your hands owes itself to a conversation I had with a reader a month or so ago, after the publication of the first issue. Eventually, we began discussing the various products that had been featured or mentioned in that issue. This reader asked me a question: How do we decide what brand of spirit, model of watch, cut of suit or variant of automobile is worthy of the Indulge treatment? That question might seem simple enough. It’s actually quite hard to answer. I told the reader that the idea of Indulge is to create a platform to talk about great products and services. Sure, we do focus on male readers, and linger on some of the finer things in life. But that doesn’t mean we are going to swoon all over a diamond-encrusted golf club. Unless it is also a great golf club. “Ah, I see,” the reader said. “But what makes a product great?” This second question, a harder one, made the Indulge team sit and think for weeks. What makes a product great? Why is a Blancpain watch any “greater” than the R3,000 quartz timepiece one can buy from the neighbourhood watch retailer? What makes a shot of premium Beefeater 24 gin, shaken with some
fresh pineapple juice, an irresistible spirit? We decided that the best way to find out was to go and ask the people who made, bought and sold these products. Tell us, we challenged them, why are your products so sexy? Everything we learnt we packed into this “deconstructions” special issue. Starting with a Montblanc pen, and ending with an extravagant Chocolate Grand Marnier cake, this issue is packed with deconstructions of around a dozen products we think are great. These include spirits, cars, bikes, a racing circuit, a suit, gadgets and even a superb work of art. One weekend morning, we called up Harsha Bhogle in Mumbai and asked him about great cricket matches. Because few things are as amenable to astounding, unscripted greatness as sport. Half a planet away, we also asked Christian Horner what it means to manage the best F1 racing team in the world (one-word summary: pressure). From front to back, this issue is an attempt to break down great things into their essential elements. As you read these pages, I hope you will be as fascinated and informed as we are.
Red Bull Racing team principal Christian Horner reveals what it means to manage a great F1 team
06| Dissecting Icons: Three
experts on iconic brands and products
08| Column: Madhu Menon on
the eightfold path to cooking enlightenment
09| Column: Joel Harrison
on the greatness in a glass of whisky
28| Watches
Our Time Has Come: New luxury releases in conjunction with the first Indian Grand Prix
29| Column: An Insider’s
Cover Story
10| The Write Stuff 12| Speed Demon 13| Burning Up The Track 14| Easy Riding 19| Good Vibrations 20| Face Value 21| Adding A Personal Touch
23| Bladeless Wonder 24| The Essence Of A Great Painting
25| Gin, But Better 26| As Simple As It Gets 27| A Slice Of Heaven
Guide To Rogue Trading
30| Milestones
Harsha Bhogle on the greatest matches he has witnessed
SIDIN Vadukut issue editor
Cover image: Sennheiser HD800
Cover design: Abel Robinson
Issue editor: SIDIN Vadukut; Editorial coordination: Neil rodricks, Pradip Kumar Saha; Design: abel robinson, Uttam Sharma, Venkatesulu. Mint editorial leadership team: R. Sukumar (Editor), Niranjan Rajadhyaksha (Executive editor), Anil Padmanabhan, Tamal Bandyopadhyay, Priya Ramani, Nabeel Mohideen, Manas Chakravarty, Monika Halan, Shuchi Bansal, sidin vadukut, Jasbir Ladi, ©2011 HT Media Ltd, All Rights Reserved
Interview Photograph: Getty Images
Indulge Interview: Christian Horner
Managing
Victory Christain Horner, team principal, Red Bull Racing Formula One team, talks about how life changes when a team achieves greatness, and about his transition from racing to managing. Red Bull is the reigning F1 constructors’ champion, while Red Bull driver Sebastian Vettel became the youngest driver to win back-to-back drivers’ championships at the Japanese Grand Prix earlier this month.
By Sidin Vadukut
H
sidin.v@livemint.com ow is managing a winning team different from managing one that is not as successful? It is a different challenge in many respects. Expectations go up, for one thing. The goalposts move; you go from being the hunter to being the hunted. Suddenly, the expectation is to continue to win. The most important thing then is stability, in creating a stable workforce. It is a harder challenge now, I think, than it was when we were trying to win. When you wake up in the morning now, are you thinking about different things, compared with before, when you were still working on winning? I think your priorities do change. For us, the immediate priority now is to focus on the next race and make sure we achieve the best possible outcome from the race. As a team, we like to look and focus on one thing at a time rather than think too far into the future. But as team principal, as a manager, do you still look at things on a race-by-race basis? Things are a little different in my case, I suppose. I have to worry about the next race, the next year, and in some cases, about certain issues for the next two or three years. You were a driver who later moved into management. How difficult was the transition? I started my career believing I was going to be a race driver. I grew up in the sport, but eventually I realized that my talent was limited. Having driven over the years for
04
INDULGE | October 2011
good teams and not-so-good teams, I decided that the only industry I really knew, understood and was passionate about was racing. So I decided to step out of a car and manage a team. Do you still drive? Once in a while, but just for fun. Nothing serious at all. For instance, last week I drove at the Goodwood Festival of Speed. But nothing serious. Red Bull has often said the team wants to bring fun back into the sport. Why do you think the fun was missing, and what are you doing about it? Red Bull has injected a tremendous amount of energy into the sport. We’ve been responsible for bringing down some traditional barriers and bringing the sport
closer to the people. We have a very large show car programme where we take Formula One into cities and areas where you’d least expect to see a racing car. Red Bull’s outlook has been quite different, especially in comparison to some of the more traditional, manufacturer-owned teams. What made the sport less fun in the first place? No, I think the sport is not boring at all. The viewing figures are fantastic and I think we put up a good show. But some five or 10 years ago, there was too much involvement by the manufacturers, which, I think, made things too corporate. But I think now the racing is really exciting. There are some big personalities, fantastic drivers, and different teams—you’ve got the heritage of Ferrari, the engineering
aspect of McLaren, and the useful edginess of the new kids on the block like Red Bull. Do the heritage teams take the new kids on the block seriously? When you’ve won 23 grand prix races and two championships, they are bound to take you seriously. But, like any sport, you’re only as good as your last race. Are you excited about coming to India? We are really looking forward to it. I think Formula One becomes a true world championship when we come to India. The circuit looks great and the interest from Indian fans has been incredible. I am really hoping to see a great inaugural race and hope all the teams will be able to put up a great exhibition for the fans.
TOD’S BOUTIQUES: NEW DELHI, DLF EMPORIO, +91-11-46662700
Interview
Dissecting
Icons Exceptional products and services are rare. Products such as the iPhone, the Nintendo Wii or a Montblanc pen have come to represent much more than just excellence in utility. They represent a generational transformation in the way people use these tools. These brands and products established new benchmarks, new standards and new consumer aspirations. They didn’t just own the markets, they dismantled them. Why were these products so powerful? How did they become symbolic not just of the consumers’ buying choices, but of their lifestyle itself? We asked three experts on the concept of greatness, what greatness means to them, and what great products they use in their daily lives. Arvind Kumar Singhal (AKS) is founder and chairman of Technopak Advisors, a Gurgaon-based management-consulting firm with pioneering experience in retail. Kiran Khalap (KK) is an author and founder of Mumbai-based brand and communications consultancy Chlorophyll. He is also an adviser to the UIDAI project. Paurav Shukla (PS) is an expert on branding and luxury marketing. He lectures at Brighton Business School, University of Brighton, UK.
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INDULGE | October 2011
By Sidin Vadukut
W
sidin.v@livemint.com
hat elevates some products and brands from the mundane to the exceptional? AKS: Fundamental innovation, rather than mere “improvement”, makes some products achieve greatness while others could merely be “successful or failures” in the commercial sense. The innovation can be in function, in technology, in design, or even in delivery. Domino’s Pizza’s pioneering effort in the delivery of pizzas is an example. KK: The brand is an idea, conviction or intention in the mind and heart of the creator. The product is a mirror that reflects the strength of this conviction: that’s what makes
What is profound is the intention.Besides getting Indian families from point A to point B at R1 lakh, Ratan Tata intended to create ‘entrepreneurs across the country to manufacture the car’. The Nano reflects that idea.
the difference palpable. Take the iPhone as an example. Steve Jobs believed man-machine interaction must be intuitive in usage and elegant in design. That belief got translated into products that don’t need an instruction manual (iPod, iPhone) and a computer that started with a smiley and a “Hi” (Macintosh). The designer of the iPod (Jonathan Ive) spent weeks with the makers of the katana, the samurai sword, to gain insights into moulding metal, because the inside of the Apple machines had to be as elegant as the outside! PS: In one of our recent studies, we identified four major value aspects luxury brands should serve, social, personal, functional and financial value. The social dimension refers to the pride relating to acquisition and display of the product. The personal dimension reflects the individualistic attitude of materialism and pleasure-seeking. The financial and functional dimensions refer to the price and quality match and the uniqueness. Great luxury brands deliver all of these values in a far better way than their competitors. For example, Hermès understands that its customers mostly belong to the patrician category who prefer privacy of consumption rather than ostentation. These customers are also interested in subtle signals and, therefore, from design to marketing, Hermès focuses on subtlety. On the other hand, brands such as LVMH or Gucci have a large customer base from the middle to the higher-middle class, and many of these customers intend to show off their acquisition. They are interested in loud signals and that is what these brands provide. Is it merely a question of style and substance? In other words, is it what these products represent that makes them great? Is it how and with what they are made? Their design? Or is there something more profound? KK: What is profound is the intention. Besides getting Indian families from point A to point B at R1 lakh, Ratan Tata intended to create “entrepreneurs across the country to manufacture the car”. The Nano reflects that idea, that intention. Of course, the design then has to break many rules to make the idea possible: aluminium engine, wheels at the extreme edges. On the other hand, Enzo Ferrari intended to create a car that would beat Alfa Romeo, his former employer. “The public does not know what’s possible. We do.” said Akio Morita, founder, Sony, and that’s how the original Walkman was born.
Interview This intention, I think, lies at the heart of a great product. Can this product and brand greatness be broken down into parts? If you can do this, how easy is it to repeat and replicate this? AKS: Only a few products can make it to “universal” greatness every decade, while countless new launches take place across all consumer product categories every year. But once a company creates its first iconic product, it can encode this into the corporate DNA in some fashion. Suddenly, the company is able to do it over and over again, often innovating in non-linear, iconoclastic ways. This is what happens in companies like P&G (Procter and Gamble), Gilette, Sony and Apple. KK: However true any mimic is, he exists only because of the idea behind that first iconic original. So a competitor can sit down and reverse-engineer that product. But the idea will always belong to the original. Though, that does not mean that a me-two or me-seven brand will not make commercial sense! Mediocre brands, like mediocre human beings, do not keel over and die. They merely exist. PS: Great brands are multidimensional. The advantage they garner over competing brands is through their superior understanding of the market and consumers and their overall value proposition. So yes, a good brand could become great by learning to do the same things. But it takes very long to get there. They have to keep satisfying their customers over and over again. Iconic products often influence far more than just the market they are meant for. They come to represent certain lifestyles and aesthetic choices. Why and how does this happen? PS: Great products represent a lifestyle because they serve more than one value function for the target market for a long period of time. This doesn’t happen in one day. It happens over a long period of experimentation and tweaking the product to the market needs. To an outsider, it may seem accidental, but in reality, many
painstaking years have gone in coming up with that final product, which everyone agrees upon to be great. For example, when Louis Vuitton made a lightweight and airtight flat-bottom trunk with trianon canvas in 1854, it became successful. However, others were easily copying the product. To regain advantage, Louis Vuitton, changed the trianon design to a beige-andbrown-stripes design in 1876. Moreover, he expanded the business to other countries by 1885, and in 1888, the Damier Canvas pattern was created. It was in 1896 that his son Georges launched the classic Monogram Canvas and patented it. What one has to realize is that the process took nearly 40 years for the organization and two generations to achieve that iconic status. What are some of the great products you use? AKS: For me, personally, products that I find great are also a function of my own stage in life. Hence, in 1980, when I first went to the US for my MBA, my IBM Selectric typewriter was simply the greatest product. It was so fundamentally different from the mechanical offerings from Remington and other brands. In 1988, we got our first Westinghouse microwave oven in India, and that was “great”, too—postWestinghouse, many other brands came to the market. Nokia’s original phone designs were amazing—functionally and ergonomically, in the late 1990s. The iPod was my big deal in the early 2000s, since it allowed me incredible flexibility in storing and managing my music. Right now, I find my Samsung Galaxy SII phone incredible in almost every respect other than battery life. KK: I use a MacBook 24/7 and I’ve never had a virus problem or a hard drive crash. And I wear a Suunto watch-cum-computer on the wrist for my trekking and rock-climbing activities: it allows me to time my activity; and tells me temperature, pressure, height. Both are reliable to the extreme. Edited excerpts. As told to Sidin Vadukut via email.
COLUMN Photographs: iStockphoto
months to years, and, while I make it sound like it’s an intermediate step, it actually continues throughout our lives. The only way to learn is through experimentation. Academic knowledge is useless without tasting real food. Right techniques
A knowledge of ingredients needs to be backed up by solid cooking technique. Once you master basic techniques such as steaming, frying, braising, stewing, sautéing, boiling, etc., you can apply this knowledge to all recipes and improve them. Learn the right temperatures for each technique, then the right utensils, liquid levels, correct quantities of food, and what ingredients work well with what techniques. Lamb will take longer to stew than vegetables (unless you like mushy veggies, and you shouldn’t), so you can’t use the same amount of cooking liquid for both. An egg will cook in a minute in a frying pan, but a chicken breast will take five-six minutes. How much fish can be deep-fried without the temperature dropping drastically and the oil seeping into your food? And what’s the ideal temperature anyway? Right flavours
You’re now in your journeyman stage, so now’s the time to get a better understanding of flavours. Of course, you should learn about basic flavours such as sour, salty, bitter and sweet (and ‘‘spicy” if you’re Indian), but food would be incredibly boring if it were just a combination of four things. Flavours have facets to them: sugar, honey and jaggery are all ‘‘sweet”, but in different ways; vinegar, kokum and lime are all ‘‘sour”, but you can tell them apart. If you talk to chefs, you will get adjectives such as ‘‘smoky”, ‘‘gamey”, ‘‘fruity”, ‘‘tart” and ‘‘meaty”, etc., to add to your flavour vocabulary. Understanding natural flavours of food will help you understand the character of a dish, which is essential to making good food. Right balance
Getting It Just Right
I
vividly recall the first dish I ever tried to cook, when I was 12. It was my version of fried rice, the recipe of which I had tried to guess by watching the cook in the ‘’Chinese’’ food van near my house. It was an undeniable disaster. Fortunately, I now know that teaspoons of turmeric powder are not quite the same as soy sauce, which is what gave the rice its brown colour. So if you think you’re a terrible cook because you have trouble making even instant noodles, trust me, everyone starts off with a blank slate. ‘’I suck at cooking. Can I ever be a good cook?’’ is something I hear a lot. The theme of this issue of Indulge is ‘’deconstruction’’, so it’s a good time for me to take you through the stages of evolution from knowing nothing at all to becoming a great cook. I’ll pretend to be Buddha-like and call it the ‘’eightfold path to cooking enlightenment’’. Let’s start with...
madhu Chef
Right ideas
menon
Right recipes
This is where everyone starts, unless you’re attending a professional chef course. Because you know little, you look for recipes from books, TV shows, friends, relatives, and try to recreate dishes based on other people’s experiences. This can work if you get good recipes with critical detail included. Avoid books with titles such as 1,001 Italian Recipes because they probably won’t spend more than four-five lines on each recipe. Look for books that teach you the principles of cooking; they’re better investments. Recipes have their limitations, however. They can’t possibly account for variations in ingredients, storage, climate, utensils, quantities and techniques. We need to learn more. Now that you’re on your cooking journey and have made a few things well, take some time to understand the ingredients you’re working with. For instance, cabbage, cauliflower and broccoli belong to the same family. What makes them different? How do their flavours, textures and cooking times vary? Can you substitute one for the other? How is cooking chicken leg meat different from chicken breast meat? How is the flavour of shiitake mushrooms different from regular button mushrooms? Did you know that roasted whole garlic has a very different flavour and texture from minced raw garlic? This stage will take
INDULGE | October 2011
Right composition
So you know how to make individual dishes taste good, but you also need to know how to combine foods into a meal for harmony. You’ll need to understand the principles of contrasting tastes and textures—pairing crunchy with soft, spicy with mild, hearty dishes with light salads, and not combining foods with similar flavour profiles. You won’t make classic mistakes such as making everything spicy, or having only an array of heavy dishes (a typical buffet meal with ‘‘dal makhani”, ‘‘butter chicken”, ‘‘shahi paneer”—all rich dishes, for instance).
Right ingredients
08
Getting to this stage will complete your transition to ‘‘good cook” (‘‘great” will have to wait). Once you are aware of flavours, the challenge in making good food is combining and balancing them. You can use the same set of ingredients and make very different dishes by changing the balance of flavours. And it’s easy to spoil a dish by overwhelming it with one particular flavour. Your mother’s perfect fish curry recipe can be ruined by making it too sour or by drowning it in chilli. A touch of sugar in a spicy dish can bring incredible balance and rounded flavour without allowing it to taste sweet. Practice will help you get better at this, and it’s necessary to move on to...
To get to this stage, you must already be a master of the previous ones. This is where ‘‘great” begins and ‘‘chefs” are born. You combine your knowledge of ingredients, techniques, flavours, balance and composition to create interesting new dishes, or to modify existing recipes and giving your own spin to them. You will no longer just read recipes from books; you will paint flavours in your head while reading, and be able to virtually taste variations on them before actually cooking. Right learning
A true master knows that learning never stops (sounds like a Gandhian cliché, perhaps?), and now is the time to focus on the trifles that make perfection. Fine-tune techniques, buy books such as Harold McGee’s On Food and Cooking that explain the science of cooking in detail, explore other cuisines, and learn about unfamiliar ingredients. Then combine this knowledge to create even more greatness. And that’s all there is to cooking. This column was meant to be a starting point, not a comprehensive guide; that is not possible in one page. Does all this need some studying and research? Of course. Nobody said it would be easy. It’s just not that hard. But somewhere along the way, you will discover the joy of cooking. And the smiles on the faces of people you feed will give you the fuel to keep pursuing knowledge.
Madhu Menon is a chef, food consultant and writer who lives in Bangalore. Reach him at mail@madhumenon.com or on Twitter @madmanweb Respond to this column at feedback@livemint.com
Column
The Glass In Your Hand
G
reatness. Surely one of the hardest words to define, especially when it comes to drink. What is greatness in a glass, everyone wants to know and I’m often asked, ‘‘Which is the best singlemalt whisky?” ‘’The one I’m drinking right now,” is my usual reply, because nothing else really matters other than the drink currently in your hand. Why? Simply because everything else, no matter how good, is still in the bottle. You can’t hit a century while sitting in the pavilion. Until you’re at the crease, you’re nothing. And if you have to walk early, then be gone! And let the next man try and have his name etched on to the honours board of history. In some arenas, greatness is measured; in others, it is perceived. When it comes to drinks, it is very much about perception, or more specifically, personal taste. Which drink takes the crown as the king of your cabinet is entirely up to you. You have the power to choose. All drinks are bespoke. By this, I do not mean that each drink is specially designed to fit your own flavour profile, but that you should find a liquid out there that fits your taste buds and, above all else, makes you smile when you take that first sip. It could be a well-deserved glass of Royal Salute loaded with ice when you’re getting ready for dinner, or the first Kingfisher you pop open when you get in from work; either way, the point of the drink is to quench the thirst of your soul as much as the thirst of your body. But what is this ‘‘greatness” we all speak of when it come to drinks? One of the major foundations for greatness must be context; the perception of your drink is limited to the vista, the view that you have of the other drinks around it. If your local liquor store only sells Old Monk rum, then Old Monk rum will be the greatest in your world. They say travel expands the mind. But forget education for one moment and think about your drinks portfolio! Probably the best way to expand the context of your selection is through Travel Retail. Travelling may be a curse for some. Time spent hanging around in airports, removing your laptop from your Samsonite cabin bag (yet again) and waiting for instructions to remove your Hermès belt for the scanner...but all this is changing. If you are privileged enough to spend a large swathe of your time jetting between Mumbai and Miami or Delhi and L.A., then you will be familiar with an area of sales that the drinks industry labels ‘‘Travel Retail”. Travel Retail is something of a phenomenon. Often listed as a market in its own right, it can be a real gold mine for brands, not just in terms of sales, but also in terms of profile. So what does this mean for you, dear reader? It means that you have a wonderful opportunity to wow your friends by picking up something utterly unique, which shows that not only are you a connoisseur of fine drinks, but also a businessman of international repute. Okay, that may be a little over the top, but Travel Retail really does provide you an opportunity to purchase something totally exclusive and quite often individual to one specific airport. And some of the biggest changes in this scene have been happening to Travel Retail in India. I asked Neeraj Sharma, business development manager for William Grant and Sons, a family-owned Scottish firm with brands such as Glenfiddich, The Balvenie and Hendricks Gin, what has changed in Travel Retail in India in the last year. ‘‘I would say everything,” he replied. ‘‘It is a very exciting time for airline passengers travelling to, from and within India at the moment.” Take Delhi airport, for example, where, alongside a walkin Humidor, travellers can visit an area dedicated to whisky. Named Uisge Beatha (Gaelic for ‘‘the water of life” and the origin of the word whisky), this is the ultimate experience for any lover of single malts or blends. One addition to this exciting area of the airport is a single cask of Glenfiddich from which the brand team pour samples. It is advanced thinking such as this by drinks companies that has led to Travel Retail becoming the perfect place to test out new products and push creative boundaries. At the start of 2010, Diageo introduced a new member to the Johnnie Walker family, with a release called Double Black, a blended whisky with a greater degree of smoke than the original Black Label. The Double Black was initially rolled out in five key Travel Retail shops across the globe, and, due to the strong reaction from consumers, the availability of the product was increased to further airport retail outlets in 2011. One day, fingers crossed, this excellent product may be on sale in a store near you. It is not just well-priced, unusual and unique bottles that are on offer. Travel Retail also provides brands with October 2011 |
INDULGE
09
joel
harrison
drinks consultant
the perfect setting for consumers looking to upscale their regular purchases. Recently a bottle of 64-year-old Dalmore, a premium single malt whisky from the house of Whyte & Mackay, owned by Vijay Mallya, sold in Singapore Duty Free for just under R1 crore. This astonishing purchase made the Dalmore the most expensive retail bottle of whisky in the world. Now that is some up-scaling from your regular bottle of Scotch! For the gentleman who purchased it, this surely will be one of the greatest liquid investments in his entire life. But will it be the greatest whisky he has ever tried? There is only one way to find out: pop the cork and pour it into a glass. Then the comparisons can start, the completion can begin. And if the businessman in question would like to invite me as a judge, I’ll be on the next flight to Singapore. Then the answer to the question of which is the greatest whisky of all time really will be ‘‘the one I’m drinking right now”. iStockphoto
Joel Harrison is a drinks writer and consultant, and co-founder of the website Caskstrength.com Respond to this column at feedback@livemint.com
Cover story
WHAT MAKES IT GREAT | Pens
The
Write Stuff The design of the clip is based on a sword.
The nib is of 18-carat gold, with the year of release engraved in Roman numerals within a laurel wreath.
P
en aficionados swear by its name, and connoisseurs across the world recognize the iconic logo of a white star with rounded edges. For over 90 years, Montblanc has defined perfect penmanship. Montblanc pens are known for their highest quality and their specially crafted nibs, and the company still makes the classic fountain pen. Montblanc also has an extensive line of high-end ballpoint pens and mechanical pencils. Marking the 20th anniversary of the Patron of the Arts edition, Montblanc in 2011 launched two limited editions—4810 and 888—of luxury fountain pens honouring Gaius Cilnius Maecenas, a patron of the arts and political adviser to the Roman emperor Octavian. But what makes the 888 a masterpiece? By Pradip Kumar Saha pradip.s@livemint.com
The Gaius Maecenas limited edition 888
Price:
R5,42,700
Photographs: Priyanka Parashar/Mint
The skeletonized cap bears the words ‘‘Maecenas atavis edite regiubs”—the first line of Horace’s ode to Maecenas.
‘‘Gaius Cilnius Maecenas” is engraved on a ring on the cap.
The barrel is made of carrara marble—a homage to the Roman empire—adorned with fine decoration on rings of 18-carat gold.
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INDULGE | October 2011
One of the highlights is Maecenas’ portrait on a Roman coin at the end of the cone that is placed by hand.
COVER STORY WHAT MAKES IT GREAT | FORMULA ONE CARS
Speed
Demon F
ormula One is the ultimate in speed, the premier class of racing since the first world championship was held in 1950. Capable of reaching speeds in excess of 350km per hour, it is a sport of thrill and danger. With a nine-month season covering five continents, the sport has spread well beyond its home in Europe—the focus for the last 12-13 years being on Asia. Later this month, India joins the world of Formula One racing with the subcontinent’s first grand prix to be staged at the Buddh International Circuit, Greater Noida. Indulge takes a look at a Red Bull Racing car to see what makes the Formula One machines special. By NEIL RODRICKS neil.r@livemint.com
COCKPIT
The cockpit is designed to allow the driver to get in and out of the car without removing anything other than the steering wheel. Once strapped into the car with all safety gear on, he must be able to remove the steering wheel and get out within five seconds, and then replace the steering within a further five seconds. The car’s survival cell structure, designed to protect the driver in the event of an accident, must extend at least 300mm beyond the driver’s feet, which must not be forward of the front-wheel centre line.
THE CAR
With strict regulations governing design, Formula One cars are typically around 4,635mm long, 1,800mm wide and 950mm high. The cars must weigh at least 640kg, and ballast may be used to bring cars up to weight.
Photographs: Ramesh Pathania/Mint Note: This is a show car used by the Red Bull Racing team.
BRAKES
The carbon-composite brakes used in Formula One cars are built to work at temperatures of up to 1,000 degrees Celsius. And under heavy braking, the drivers are subjected to up to 5.4G at the faster tracks such as Monza in Italy and the Gilles Villeneuve circuit in Montreal, Canada. The cars have one brake system operated through a single brake pedal. The system has two hydraulic circuits, one each for the front and rear wheels. If one circuit fails, the other remains operational.
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INDULGE | October 2011
ENGINE
The Formula One cars have naturally aspirated V8 engines with the capacity limited at 2.4 litres, and are rev-limited to 18,000 rpm. Teams are allowed to run a Kinetic Energy Recovery System that converts waste energy generated during braking into additional power, available to the drivers in fixed amounts per lap. The cars do not have onboard starting systems, and starting devices are used in the pits and on the grid.
TYRES
For the 2011 season, all teams are required to use tyres from a single manufacturer—Pirelli. Over a race weekend, each driver has access to 11 sets of dryweather tyres (six of the harder ‘‘prime” specification and five of the softer ‘‘option”), four sets of intermediate tyres, and three sets of wet tyres. And during the race itself, a driver has to use both dry-weather specs—unless racing in wet conditions—or else face exclusion from the results.
SUSPENSION
Formula One cars have a conventional sprung suspension. Any system—such as an active suspension—that can alter the suspension or its geometry while the car is moving is forbidden. Each wheel is tied to the body by two tethers, each contained within a separate suspension member and with its own attachments at either end. The tethers are designed to stop the wheels coming loose from the car in case of an accident or a suspension failure.
FRONT, REAR WINGS
Movable bodywork is not allowed in Formula One cars, with the exception of the rear wing, and then, only under strict conditions. The angle of incidence of the rear wing can be adjusted from the cockpit, but this is electronically governed and is only available when the driver is less than a second behind another car at predetermined parts of the track. The aim of this ‘‘drag reduction system’’ is to boost overtaking by reducing air turbulence. It is deactivated once the driver brakes.
cover story Photograph: Hindustan Times; graphic: Yogesh Kumar/Mint
The long sweeping curve that begins after turn 9—turning in at high speeds—will be a prime overtaking point.
Burning Up
The Track
By Neil rodricks neil.r@livemint.com
T11 T12 T10
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and
T14
T9
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Clas sic s tand
ic ss Cla
ar St
st (ea d n sta
Race direction T7
(eas t
st
d an
2)
(e
T15
T6
T5
West zone
) t1 as
North zone East zone South zone
Premium stand (north) T16
Main grandstand
T1
Pitlane
3)
T2 T4
Star stand (east 2)
Turn number Start-finish line
T8
th)
The best views of the race will be at the south stands as well as the classic stand-east 2.
T#
Clas si (we c stand st 1)
T13
Nat
nd sta ) nic rth Pic (no
The Buddh International Circuit at Greater Noida, designed by German engineer and racer Hermann Tilke and the latest to join the Formula One calendar, is set to host one of the fastest races of motorsports’ premier class, with an average race speed of close to 210km per hour. Unveiled 10 days before the Indian Grand Prix weekend begins, the circuit is a continuation of Tilke’s designs at the other racetracks across Asia—Turkey, Abu Dhabi, Malaysia, China, South Korea—long, fast straights going into sharp turns, with a series of long, winding curves. But added to these are changes in elevation across the track, which should make the inaugural Indian race a fast and exciting one.
The start-finish straight and a 1.2km straight between turns 3 and 4 will see the F1 cars pushing their limits.
Cla s (w sic s es ta t 2 nd )
WHAT MAKES IT GREAT | Formula one tracks
Pr em (so ium ut sta h) nd
The drivers will experience high levels of lateral pressure at three chicanes—turns 6-7, 8-9 and the faster 13-14.
T3
Star stand (east 1)
Turn 16—the final one of the lap—will be crucial for overtaking as it is the beginning of a very fast sequence, including the three straights on the circuit and heavy braking at turns 1, 3 and 4.
Classic stand (north)
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WHAT MAKES IT GREAT | MOTORCYCLES
Easy Riding A heavyweight in its category of heavyweight bikes, the Fat Boy was introduced as part of Harley-Davidson’s Softail line in 1990, and it promptly became a legend in itself. With its muscular styling, powerful displacement and low seating, this is the bike for a drive down those long Indian highways. Big wheels for a big country. By NEIL RODRICKS neil.r@livemint.com
TOTAL CONTROL
The Fat Boy’s 140mm wide front tyre mitigates feedback from the streets and the 200mm one at the rear provides sure contact with the road. Manufactured by Dunlop, these tyres are sure to give you excellent traction.
Price:
R19.7 lakh
(ex-showroom, New Delhi)
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INDULGE | October 2011
PURE POWER
COMFORT DRIVE
Along with the low seat height, Harley-Davidson has slimmed down the width of the seat itself—giving it a unique style without sacrificing comfort.
The Fat Boy’s Twin Cam 1,584cc engine is capable of producing a torque of 125Nm at 3,000rpm—more than you need for our Indian roads. The bike is also fitted with an electronic sequential port fuel injection system.
all style Ample space
The full-length footboards provide plenty of space for rest, and allows for heel-toe gear shifting without the possibility of damage to your boots.
All Harley-Davidson fuel tanks are hand-finished, resulting in a seamless design.
security package
For the Fat Boy model with the optional antilock braking system, the components are hidden within the wheel. This means that not only will the bike still have that streamlined design, but will also behave whenever you need it to.
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WHAT MAKES IT GREAT | HEADPHONES
Good Vibrations S
ince the late Fritz Sennheiser founded the Laboratorium Wennebostel in 1945, manufacturing tube voltmeters that year and expanding to microphone production the next, his company has developed into a force majeure in the world of sound experience. The Wedemark, Germanybased company offers products and customized solutions across all areas of sound recording, transmission and reproduction, but Sennheiser’s HD800 headphones are testament to its more than 60 years of research and development. What sets the HD800 apart is its ability to produce a more voluminous sound wave, a distinctly clearer sound, and better playback.
By Neil Rodricks neil.r@livemint.com
Transparent chassis with hi-tech stainless steel mesh protector
Ring transducer for maximum sound and a minimum of spurious oscillation
Protector
Precision magnet
Bigger the better
The transducer of the HD800 is, at 56mm in diameter, the largest that can be found in dynamic headphones. In theory, the more transducer surface that vibrates, the purer the sound at low frequencies, but at high frequencies, there is a distortion in sound reproduction. Sennheiser’s design for the ring minimizes this distortion.
Sennheiser HD800
The transducer is encased in precision material made of stainless steel. The large ear cups fit comfortably over the ears, and the weight of the headphone—just 350gm— makes listening a pleasure. And the angles at which the ear cups are placed create the sensation of natural hearing—a replication of basic acoustic conditions.
Price:
R79,990
October 2011 |
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cover story
WHAT MAKES IT GREAT | Watches
Face Value T
he Le Brassus split-seconds flyback chronograph from Blancpain does not, as you may have noticed, have the tourbillons, minute repeaters or diamond-encrusted bezels that some think distinguish a luxurious modern mechanical watch. But, in fact, it is a superb complicated watch that sits well on the wrist and screams class instead of carats. We asked Southampton-based Blancpain watchmaker James Avery what he thought made this timepiece exceptional.
Movement Blancpain’s own 40F6 calibre movement comprises 398 components and 37 rubies.
Dial The opaline dial is minimal with subtle lettering and simple demarcations.
by Sidin VAdukut
Hands
sidin.v@livemint.com
Unlike many chronographs, the hands are slim, without any luminous inserts, which gives it an austere, classic look. Somewhat reminiscent of heritage pocketwatches.
Price
ÂŁ35,590
Bezel At 42mm in diameter and 8mm in thickness, the watch is perfectly proportioned for most wrists. The model shown has a simple, quintessentially Blancpain case with that extra element of luxury in the red gold metal, a colour popular with Asian markets.
Buttons The watch houses a split-seconds flyback chronograph, a complicated movement in itself. But here, the pusher for the split-seconds function is integrated into the crown. This retains the horizontal symmetry of the case.
Caseback The transparent window showcases exceptional craftsmanship and finishing. Every element of the movement, including parts the average user will never see, is worked on by hand.
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Cover Story Photographs: Priyanka Parashar/Mint
WHAT MAKES IT GREAT | suits
Adding A
Personal Touch
T
he suit jacket is essential to any man's wardrobe, the right one for the right occasion, be it a wedding or for the office. And the effect of the suit can never be overlooked—beyond style, it exudes power and confidence. The company founded by Ermenegildo Zegna in 1910 now makes suits not only under its own brand, but also for the likes of Tom Ford and Yves Saint Laurent. All Zegna suits are given that personal touch, with 30% of the work on each suit being done by hand—for some, this is as high as 70%. By Neil Rodricks neil.r@livemint.com
The lapels are made using AMF stitching, which keeps the interlining in place as it moves with the outer fabric. The suit jacket is made of 15-micron, Australian Merino wool. The interlining is made of silk from Mongolia and China, or satin sourced from Europe.
The collar—again wool—can be lifted up so a muffler can be worn, either in the cold or simply for style.
All buttons on the outside are of buffalo horn, while those on the inside are mother-of-pearl.
The warding—the layer closest to the body—is stiched to the rest of the jacket with horsehair and camel hair.
Even the thread used to sew the jacket together is wool.
The buttonholes are sewn by hand using pure silk thread.
The hand-sewn breast pocket is angled so that the pocket square remains in place no matter what.
The suit jacket has side vents, allowing for comfort while sitting as well as keeping your hands in your pocket.
Price:
R1,45,500
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cover story
WHAT MAKES IT GREAT | Fans
Bladeless
Wonder E
A mixed-flow impeller—a combination of technologies used in turbochargers and jet engines—draws air into the base of the machine.
lectric fans haven’t changed much since they were invented in 1882—blades slicing through the air to push it forward. When the engineers at Dyson first began working on a fan without blades, they started with pressurized air, forcing it through narrow apertures to create jets. But a breakthrough came when they noticed that accelerating air over a ramp amplified it 10-20 times. Fluid dynamics engineers spent four years ‘‘running hundreds of simulations to precisely measure and optimize the machine’s aperture and airfoil-shaped ramp”, and air fluctuations were mapped using laser doppler annometry, finally revealing the ideal ramp angle, aperture width and loop amplifier dimensions. ‘‘We realized that this inducement, or multiplication, effect could be further enhanced by passing airflow over a ramp,” says inventor James Dyson. ‘‘And, of course, this was the point where the idea of a bladeless fan became a real possibility.”
By Neil Rodricks neil.r@livemint.com
Price:
R33,000
The air then passes over a 16-degree airfoil-shaped ramp, channelling its direction.
Price:
R26,000
The surrounding air is drawn into the airflow, too. This is called entrainment.
The resulting airflow is amplified 15 times.
10-inch AM01 Table Fan The Dyson Air Multiplier pulls air through a brushless motor base and multiplies it 15 times, expelling it at 118 gallons per second.
AM02 Tower Fan
These fans don’t cause buffeting like conventional fans that chop the air before it hits you.
Photographs: Priyanka Parashar/Mint
October 2011 |
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cover story WHAT MAKES IT GREAT | ART
The Essence Of
A Great Painting
I
ndian painter Jehangir Sabavala worked most often in oils, creating landscapes and seascapes of rarefied beauty. Born in an affluent Parsi family in Mumbai, he studied at Mumbai’s Sir JJ School of Art before attending art schools in London and Paris in the 1940s and 1950s. In Europe, Sabavala was influenced by Impressionism and cubism. Today, he is regarded as the greatest Indian exponent of cubism. In a Sotheby’s auction on 15 September 2011 in New York, his serene and delicate Cobweb Cloud (1973) sold for $266,500 to a private collector from Europe. It generated much interest also because of the timing: Sabavala passed away on 2 September in Mumbai. We asked Maithili Parekh, country head and director of Sotheby’s, India, what gives Cobweb Cloud its venerated status in art circles. By Anindita Ghose
anindita.g@livemint.com
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INDULGE | October 2011
PROVENANCE
Photographs: Sotheby’s, Hindustan Times
ESSENCE
TECHNIQUE
The painting was exhibited at Mumbai’s Jehangir Art Gallery in 1973 (the year it was executed) and has been housed in a private collection ever since— and, hence, rarely seen. It was chosen by Sabavala and curator Ranjit Hoskote, also the artist’s biographer, to be exhibited at the artist’s retrospective, The Art of Jehangir Sabavala, at the National Gallery of Modern Art in Mumbai and Delhi in 2005-2006.
Cobweb Cloud symbolizes, according to Sabavala, ‘‘the essence of painting”. ‘‘...The essence of painting coalesces, for me, in a painting like Cobweb Cloud. Here, composition, colour and texture are spun together, with the mystery of the spirit, in a gossamer landscape.” (As quoted by Hoskote in The Crucible of Painting: The Art of Jehangir Sabavala, 2005)
Cobweb Cloud is reminiscent of the early 20th century protocubist works by Pablo Picasso, Juan Gris and André Lhote (under whom Sabavala studied in Paris from 1947 to 1951). It displays a departure point between Sabavala’s early tightly ordered, analytical cubist works and the richly textured composition planes of his later works.
COLOURS
COMPOSITION
MESSAGE
Cobweb Cloud utilizes the artist’s characteristic subdued palette—shades of calming azure, greys and ochre—capturing the arc of evening light over a plain. Through the 1970s and 1980s, Sabavala seemed to be responding to a history of loss by evoking the elements as the ultimate home of the homeless. In these canvases, the subtle colouring and the vast amplitude of land, sky and sea provided a sense of the infinite.
A beautifully balanced composition, where lonely pilgrim figures punctuate the various planes, Sabavala distils the landscape he sees around him using crystalline geometry, carefully controlled and deliberate strokes of refined abstraction to create a timeless vista, capturing an austere and still vastness enveloped in mystery.
‘‘Clouds—evanescent, magical, ominous— have been a favourite subject of mine, to which I often return. In this work, a delicate web has been spun across the landscape, enmeshing the humanoids on their journey. Can they escape? Will they free themselves?” (Personal communication between Sotheby’s and Sabavala on 4 August 2011 about this work.)
cover story
WHAT MAKES IT GREAT | LIQUOR
Gin,
But Better
S
ince 1820, Beefeater has been known as the definitive London gin. Distilled in a brewery in Kennington, a stone’s throw from the famous Oval cricket ground, the clear, fruity, spicy spirit is indispensable in the English summer when it pairs with tonic to form a classic cocktail. In 2008, Beefeater’s master gin distiller Desmond Payne put his 40 years of experience into creating a new Super Premium spirit ‘‘for the 21st century”. However, a classic spirits recipe that has remained unchanged for decades is not to be dabbled with lightly. During his research, Payne discovered that founder James Burrough’s father was a tea merchant by royal appointment to Queen Victoria. He had his inspiration. In addition to the classic Beefeater gin’s nine botanicals, superpremium Beefeater 24, so called because 12 botanicals are steeped in the liquor for a full 24 hours before distilling, contains grapefruit peel and a blend of Japanese Sencha and Chinese green teas. The result is a masterpiece. Your palate may not pick out all the elements. But it will salute the sum of the parts.
By Sidin vadukut
sidin.v@livemint.com 1 Juniper berries These are what make gin what it is. Impart flavour and slight bitterness through tannin compounds. Beefeater uses junipers grown in the hills of Italy, Serbia and Macedonia. 2-3 Angelica root
4
Price: Approx. $30 per 700ml bottle
and seeds
Along with the coriander, this imparts a spicy flavour and a long floral finish to the aroma. The root gives it a dry, woody flavour.
Coriander seeds
Besides being the spice coriander is famous for, it also gives the spirit a fresh, light taste.
5
Liquorice
Popular in confections, liquorice gives gin a lingering, sweet finish on the palate.
10 Grapefruit peel Special to the Beefeater 24, grapefruit peel imparts additional tang and tartness.
6
Almond
11
Japanese Sencha tea
7
Orris root
12
Chinese green tea
8
9
Gives the spirt a light flavouring of soft spices and marzipan. This imparts aroma to the spirit, but also, more importantly, acts as a fixing agent binding all the different aromas together.
Seville orange peel
Seville oranges are bitter, but the dried peel is an excellent flavour enhancer imparting clean, citrus notes.
Lemon peel
This tea is smooth, grassy and even a little citrus. It is an unusual botanical that makes Beefeater 24 unique. Complements the Japanese Sencha tea with an additional floral flavour.
• Bottle
Inspired by an Arts and Crafts era ceramic flask once used by the company at the turn of the 20th century.
Combines with the other citrus botanicals to give balance and complexity to the gin.
10
12
2
6 3
1
9 11 8 7
4 5
Photographs: iStockphoto, Thinkstock, Getty Images
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cover story Photograph: Priyanka Parashar/Mint
WHAT MAKES IT GREAT | COCKTAILS
As Simple
T
As It Gets
hough there can be innumerable derivatives of the martini, the quintessential drink is basically gin and vermouth, in varying proportions, and served in a conical stemmed glass with either a slice of lemon or a green olive. And it is its simplicity that makes the martini such a great cocktail. It is available in both classic and flavoured variants, the latter replacing the gin with, preferably, vodka. Indulge, with The Oberoi in New Delhi, looks into what gives the martini a place of pride among other cocktails. The signature martini, or the basilico, at The Oberoi is gin with lemon and basil—the basil adding a freshness and sweetness to offset the dry, bitter flavour the cocktail would have otherwise. By Neil Rodricks neil.r@livemint.com
LONDON DRY GIN 60ml (Bombay Sapphire)
London dry gin is the most common form of gin. The principal content is juniper, but it is usually distilled in the presence of citrus botanicals as well as a combination of spices. Bombay Sapphire has 10 botanicals—almond, lemon peel, liquorice, juniper berries, orris root, angelica, coriander, cassia bark, cubeb berries and grains of paradise.
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INDULGE | October 2011
Tap the basil and place it in a shaker.
Then add the gin and shake well with ice. This enhances the flavour of the basil.
Squeeze fresh lemon juice.
Price: R600-700
cover story Photographs: Priyanka Parashar/Mint
Price:
R3,500/kg (R3,000/kg without the edible gold)
WHAT MAKES IT GREAT | CONFECTIONeRY
A Slice Of
Heaven W hen we asked Delhi-based pastry chef extraordinaire Kishi Arora to bake us a great cake, it took her all of five minutes to decide on her signature Chocolate Grand Marnier masterpiece. Arora, who studied her craft at the famed Culinary Institute of America and runs her Foodaholics bakery in the Capital, crafted this stacked tower of decadence out of eight layers. No visual or verbal deconstruction will do the cake justice. But we still tried. By Sidin Vadukut
sidin.v@livemint.com
A finishing layer of white chocolate pearls dusted with gold and edible gold balls. Topped with marzipan flowers and hand-rolled chocolate cigars with gold foil Chocolate ganache, but with orange segments soaked in the cream for extra... orangey-ness PailletĂŠ Feuilletine, a French concoction of crushed paper thin wafers or crĂŞpes A compote, or spicy and sweet reduction, of Seville oranges Chocolate cake drenched in Grand Marnier and orange blossom water Cream cheese with whipped cream and intense Madagascan vanilla Chocolate Bavarian with fresh orange zest and high-grade, luxury French Valrhona chocolate
Chocolate cake with a sour cream base, soaked in orange blossom honey, wine and navel orange juice
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WATCHES
Our Time Has Come With India’s first Formula One race just around the corner, we look at three luxury watchmakers that are launching special edition chronographs in conjunction with the race. By Neil Rodricks neil.r@livemint.com
Hublot
F1 King Power India The Swiss luxury watchmaker is coming out with a limited edition of 200 pieces, sporting the F1 logo and the colours of the Indian flag on the dial and bracelet. The watch has several aspects made from an array of high-tech materials directly inspired by Formula One, some of which have never before been used in watchmaking. These include a ceramic bezel with a circular-grained satin finish adorned with multiple holes to represent a high performance brake disc, and a strap made from rubber and Nomex, a synthetic fibre developed by Dupont De Nemours and used to make the suits worn by F1 drivers. Price: R20.24 lakh Available at: Select stores in New Delhi, Mumbai, Kolkata, Chennai, Bangalore, Ahmedabad and Hyderabad
Richard Mille
RM 011 Felipe Massa This Flyback chronograph, with its oversize date, annual calendar, totalizer and 60-minute countdown timer, is made of 18-carat red gold and limited to 10 pieces. It reflects the colours of the Indian flag on the dial, rounded off with a deep saffron Alcryn grip on a grade-5 titanium crown. Each watch has a special serial number engraved on the back with the words ‘‘Felipe Massa First Indian Race’’. Ferrari driver Felipe Massa, runner-up in the 2008 Formula One championship, has been ‘‘testdriving” Richard Mille watches since 2006. Price: R2.28 lakh Available at: Select stores in New Delhi and Mumbai
TAG Heuer
India Racing Limited Edition TAG Heuer has had a long involvement with Formula One, dating back to 1963 when Jack W. Heuer, the son of CharlesEdouard Heuer, started work on a new chronograph specifically designed for drivers and motor racing enthusiasts. For the Indian Grand Prix, the Carrera Tachymeter Chronograph has been chosen for a special edition of 200 pieces, adorned with the logo ‘‘Mastering Speed for 150 Years’’ in saffron and green on the dial as well as on the sapphire crystal caseback, along with a car-shaped logo on the dial. The chronograph hand and the thread stitching on the leather strap are coloured saffron. Price: R1.99 lakh Available at: Select TAG Heuer stores across India
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COLUMN
An Insider’s Guide To
Rogue Trading
Photographs: AFP, Bloomberg
tier I banks are similar; each wannabe bank is deficient in its own way.” A quick look at history will justify this famous quote: Nick Leeson used a hidden account for his rogue trades, Adoboli apparently used deficiencies in monitoring forex exposure, and Kerviel used French managers’ assumption of omniscience. Step 4
Now that the preparation is done, pacts are made, onward to the fourth step: initiating the rogue trade through gradually increasing the long position in the traded asset. Rogue trades, almost by definition, are on the long side, primarily due to two reasons. The first being that long-risk positions benefit from the behavioural quirk of being perceived as ‘‘natural” and, hence, lower risk with the positive carry providing daily confirmation of this erroneous belief. A short-risk position, in contrast, requires an explanation for the daily carry cost, which increases with position size leading to detection before optimal size is reached. The second is the lower number of operational issues such as repo, stock borrow, etc., associated with long positions reducing the probability TOP OF THE CLASS: (clockwise from of early detection. top left) Kweku A gradual increase in position size Adoboli, Nick is recommended as the increased time Leeson, Yasuo Hamanaka and to attain rogue status allows unknown Jerome Kerviel. unknowns to appear at a pace that can be dealt with successfully. The hall of fame is testament to the fact that patience is a virtue: Yasuo Hamanaka, Leeson, Kerviel, Adoboli all built their gigantic long positions over time. Step 5
T
he credit crisis and its aftermath, the European sovereign debt crisis, have ruined a generation of bankers who have entered the industry in the last five years. The closest they’ll ever get to seeing big bonuses is when reading about them in Michael Lewis’ books. However, for traders and aspiring traders who joined the industry for the noble purpose of helping others see Ferraris, Patek Philippes and luxury penthouses, all is not lost. Here is a simple, five-step process to teach the aspiring trader to play their cards right and unleash the inner rogue. Step 1
The first step is to choose a tier II or tier III bank with pretensions of becoming the next Goldman Sachs. Almost all potential candidates trip at this first hurdle and consign themselves to a life of upper-middleclass drudgery. Ironic, since traders set great store in being contrarian. The reason for such a choice is simple: these wannabe banks have poor systems to monitor risk, with a mish-mash of cheap, off-theshelf software and ad-hoc, internally developed VB spreadsheets just about passing regulatory muster. Add in management mediocrity in an organization with its strict adherence to the Peter Principle and our aspiring trader feels like the Wehrmacht encountering Polish resistance. In contrast, a tier I bank will disable their pass and issue an all-points bulletin even before they reach the parking lot after misbooking a piddling $10 million trade. Step 2
The next step is to choose to trade either in a liquid exchange-traded market or a completely opaque complex derivative book, which requires multiple-model inputs as it successfully evades the small number of effective risk controls in place. The historical bias has been for the former simply
Su Do
Nim
investment banker
because first, tier II and III banks don’t have big enough books to lose enough money on complex derivatives and, second, the entry requirements are tougher with a master’s or PhD required to trade. After the disservice done to traders by the media’s portrayal of them as reckless gamblers and its confirmation by traders’ antics, banks have managed to create a Maginot Line covering the semi-liquid markets such as corporate bonds. The undefended positions in the very liquid exchange-traded market are due to the management belief that it is impossible to hide positions or price incorrectly. In complex opaque markets, the management has no idea about the product and defers to the trader as long as his profit and loss statement is in black and he can answer any question on pricing with a sufficiently overly complicated argument using triple integrals. Step 3
The third step is to befriend everyone in IT, product control and risk management. This was easier when traders rose from the ranks, but Kweku Adoboli of UBS and Jerome Kerviel of Société Générale have erected a class barrier. However, the aspiring trader must reach across the divide as not only will it help in understanding the system and risk control process deficiencies, but also give an early warning in case the rogue trade is unravelling since the product controller friend is likely to ask the trader to confirm discrepancies before going to the boss. As Leo Tolstoy might have said today, ‘‘All
The fifth step is the most difficult with even those in the hall of fame unable to execute it successfully. It involves cashing in on the rogue trade irrespective of the outcome of the trade for the bank. Usually, the rogue trade fluctuates between a large gain and a large loss as the trader becomes mesmerized by the roulette wheel and forgets that the aim of the game is to walk out of the casino floor with a suitcase full of chips. Eventually, the large loss is discovered and Christmas comes early for readers of The Guardian. A large loss is obviously a problem, but a large gain on the rogue trade is a problem as well. This is mainly due to two reasons. The first is the way bank compensation works where gains beyond a small absolute amount are earmarked for the management bonus pool. Marx was so enraged by this that he wrote pages and pages on the expropriation of the value added by labour. The second is that large profits also raise red flags and, often, it is not easy to realize the mark-to-market gain and hide the cash. Therefore, the trader is advised to follow a simple three-step process to reap the rewards of his hard work. 1. Set up a personal trading account, which cannot be traced back easily, preferably in a jurisdiction where access to money is easy, extradition is not. 2. Take the opposite position in this account. In case of a gain on the rogue trade, use the rogue position and profit to push the market the other way and gain on personal account until the large profit reduces to a more manageable size, which can be reported to further trading career within the bank. This cycle can be repeated until one is unfortunate enough to chalk up a large loss. 3. When detection becomes inevitable, the trader needs to catch the first available flight to the destination of his personal account and not ask his Facebook friends to pray for a miracle. The bank’s forced unwind of the position will ensure the personal account is topped up nicely. Once safely ensconced in a penthouse with a sea view, he can profusely apologize for his trades, deny criminal intent, and state that he had the best interests of the bank at heart. Then he should concentrate on the more important work of securing a large advance for the book, selling the movie rights, setting up a lecture tour (in non-extraditing countries only) and offering expertise in risk management and fraud detection to banks.
Su Do Nim is a sceptical investment banker based in London. He wished to remain anonymous, while his blood funnel sucks the life out of the global financial markets. And your savings. October 2011 |
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Interview Photographs: Nisha/Mint, AFP
Harsha Bhogle on...
His Greatest
Cricket Matches
I
am trying to think of both the best matches I have ever seen, and my best days at work. For instance, in 2008, there was the third Test in Perth against Australia. This followed the extremely controversial second Test in Sydney. India came back and won at a ground where they were expected to be blown away in threeand-a-half days. I remember saying then that Shaun Tait was going to bowl at 200km per hour and he was going to destroy. But India won. So from a cricketing and sporting perspective, that was a brilliant occasion. Or winning in adverse conditions in Leeds in 2002—that was a superb match. Another match that truly stands out for me is the Twenty20 World Cup final in 2007, which India won against all odds. I wasn’t expecting anything. There was a sense of discovery about the whole format. No one knew where T20 was going to go. And as it turned out, one magical decision by M.S. Dhoni to throw the ball to Joginder Sharma and one moment of madness by Misbah-ulHaq changed the future of T20 cricket. For if India hadn’t won that World Cup, T20 would never have become big in India. But it did become big...and the rest is history. Just think of that moment when Shahid Afridi walks into the ground and decides to hit Irfan Pathan first ball—and gets out. The game just changed in that moment. It was like going into the unknown. From the first match of that tournament...that whole T20 World Cup, in fact, was a journey into the unknown for all of us. If I had to be abandoned on a deserted island with a DVD of just one match, it would have to be that T20 World Cup final and...one other game that I must have watched around a hundred times, in various instalments over the years—the NatWest Series final in 2002. What makes these games great? One aspect is the fact that you don’t know till the very last moment how the game is going to swing. You are on tenterhooks throughout. And maybe something unexpected happens. For instance, THAT Test match against Australia at Eden Gardens. I did the previous game in Mumbai in 2001 where we got destroyed in three days. And everyone was expecting the same treatment in the second one. India is trailing by 274 and you are expecting another fourth-day finish. When you suddenly see two Indian batsmen batting the entire day without getting out. Which is completely unexpected, out of the blue. How can you not remember that? It is not just about remembering great batting or great bowling. For me, it is about witnessing how a situation suddenly changes. Which is why I would remember that Test match more than the following Test match in Chennai. The next match was even closer. It was another brilliant Test match...Harbhajan Singh, Sameer Dighe all shined. But watching two batsmen bat the entire day, no one had seen anything like that before. An Indian batsman scoring 281, hitting the ball anywhere he wanted against McGrath, Warne and Gillespie...we will never see that again. When I think about it now, seeing an innings like that can impact the way you
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INDULGE | October 2011
Harsha Bhogle began commenting on cricket when he was just 19 years old. A chemical engineer and an MBA, Bhogle has since gone on to become one of the most famous faces, voices and intellects in international cricket. In a profession with an unfortunate reputation for cliche and analytical shallowness, Bhogle has the unique ability to elevate broadcasts with sharpness and wit. During a top-level career that has lasted two decades, Bhogle has witnessed and commented on some great matches. But which were the best?
watch cricket in two ways. On the one hand, every time you see Laxman play, you think, “I’ve seen him do something special before. Maybe he can do it again”. But then you also realize that what you saw was such a special moment, such a one-off achievement, that you will perhaps never see that again. Indeed, if tomorrow Laxman makes 281 again against an Australian attack, then his first achievement would cease to be unique. In fact, I think it would diminish his performance at Eden Gardens. The moments that stand apart are those once-in-a-lifetime events. Which is why, for me, the greatest moment in cricket has to be the IndiaPakistan Test match in Chennai in 1999. Where the crowd gave Pakistan a standing ovation after they defeated India...in India! Will that ever happen again, given the political situation? Will it ever happen in Chennai again? And it was so unexpected. It was a very politically charged tour. It was more a political thing than a cricketing thing. Everywhere you went, there was security. And then this happens. After the match, I am in the middle of the stands somewhere, doing my closing piece-to-camera and I hear my producer saying, “Keep talking for the next 20-30 seconds, I am going to give you some pictures to talk over.” And suddenly I see this Mexican wave...the entire Chennai crowd is giving Pakistan a standing ovation. I don’t think we will ever see something like that again. Is there a parallel for this anywhere else in world sport? I don’t think so. What an unforgettable moment. What a privilege to witness it. Edited excerpts. As told to Sidin Vadukut.
A DAY TO REMEMBER: V.V.S. Laxman (left) and Rahul Dravid walk back to the pavilion unbeaten on the fourth day of the second Test between India and Australia at Eden Gardens, Kolkata, on 14 March 2001.