Mrs. Balentine at LOWRY MEMORIAL SCHOOL

At the Lowry Memorial School there was a Lady of Anglo Indian or possibly of fully Anglican descent by name Mrs. Balentine who used to teach Mathematics at Elementary School. She was a dynamic woman who had a passion for Children and must have been some fifty odd years when she was teaching at Elementary school in 1975. She used to use the phrase pitchy-maddy at erring students. She along with her older sister used to live at a residence near the old Main Gate of the School.

Some how I suddenly remembered this lady and thought she needed reckoning for  the services she rendered to us as children.

The Paradox of Stealth

Economics of Saving is a very important component of Macro Economics and Global Economics. Saving and Savings by itself provide various safe-guards to the Economy. Point 1 It prevents people hoarding money in their private domain and denying some form of circulation...Point 2 by default organized Banking institutions increase the worth of money...Point 3 money can be deployed into sectors of the economy where it is badly needed and finally Banks provide a safe haven and prevents crimes of theft.

Banking Institutions in India are an important life-line of the Economy and provides a frame work for social security and given the higher levels of population and density of population as seen in India Banking will have a say which will increase manifold in the future considering the fact that a large sector of the population is still un-Banked. Conversely said as the number of people inducted into the banking system increases more the stability of Banks a feature characteristic of India to the possible exclusion of many other countries of the World and also note that banking in India is a hundred year old phenomenon.

Alongside Banking is the activity of stock-broking which could be called as Corporate Banking if one would say so..a higher risk venture of directly investing in Companies through shares through Stock exchanges and the like and expecting rewards...this is banking through investments in Corporates a form of exchange found in many countries of the world today and supports and co-exists with the conventional banking system and set to morph and evolve in many ways.

For a moment let us focus on the conventional Banking system which is familiar and prevalent and is for practical purposes collector of money from the public; large sums at times to be lent in the public domain and is a lawful responsibility of individuals to do so and support the financial system.

What is the Paradox of Stealth ? A wealthy man who has invested in the Banking system whose money increases proportionately and unencumbered with time feels famished and poor and counts only his liquidity as his source of wealth and not the Deposits he has and note that this paradox is more prevalent with term deposits as against conventional Savings. He deceives himself into believing he is much less richer than what he is because much of the wealth is invisible and sometimes concealed in the Banking System.

This phenomenon can be seen more so in the Working sections of the population who are still over dependant on their employment though they are seemingly well-off and fail to take advantage of their position some times for various reasons.

How can someone avoid the Paradox of Stealth ?

One ..properly accounting for his long term and short term liquidity needs

Two..Assessing periodically his return from the Banking System

Three..Measure reasonably the Economic significance of Employment at any given instance

finally take decisions taking the full position and not the stealthy position.

ECONOMIC REVENUE AND OPPORTUNITY COSTS

Opportunity Costs  are an important component of Economic studies and forms a core domain of Economics. Many people define Oppurtunity costs in many ways and there are various approaches to analysing opportunity costs.

For practical purposes what is Opportunity Costs ?   They are basically of two kinds..costs of missed opportunities and also the costs of Alertnate choices as the case might be.

We see Opportunity Costs in the case of missed Business opportunities  and Opportunity costs of a different kind in the use of resources for alternate production in the areas of Manufacturing.

Let us take the case of Oppurtunity costs in the form of missed Oppurtunity with regards to Business Economics.

                                 QUANTITY      DEMAND    PRICE                   REVENUE

TEA                              7                       8                        7                               49

COFFEE                       6                       5                       8                                 48

Note the context of missed Opportunities;

Demand for tea was 8 but quantity produced was only 7 and there is loss of opportunity of one tea

Also note that one extra coffee was made with one coffee as wasted opportunity.

Loss of income due to missed opportunities id to the tune of   7  +  8  which is 15

The economic Revenue so to say is less than the Market Revenue;

TOTAL MARKET REVENUE IS 49+48  which is 97

Loss of opportunity is 15

SO ECONOMIC REVENUE IS 97 – 15  WHICH IS 82

ECONOMIC REVENUE = MARKET REVENUE When TEA PRODUCED IS 8  AND COFFEE IS  5

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