Avinash Meetoo

Let us build a Smart Mauritius

This work is licensed by Avinash Meetoo under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 Unported License. Creative Commons License

What is high inflation and what can we do?

By Leave a Comment

Inflation is rising all over the world

I am not an economist but I have a family and it is important for us to be financially literate and sound. I have been hearing, for the past few months, that inflation is rising all over the world and is currently at 6.3% in Mauritius according to my own calculations. The last time the rate of inflation was that high in Mauritius was in 2011, eleven years ago.

I am trying to understand what effects a rising inflation will have on the country’s economy but also the economy of a typical household. I am doing that by reading a lot of articles online, watching relevant videos on YouTube as well as participating in a few selected online forums.

Why inflation is so high?

As observed in an article in The Conversation, the population generally feels that COVID-19 is under control and are going out and consuming / purchasing more now.

People are using their own savings made during the pandemic but also the stimulus checks and other pandemic-related aid they obtained from Government.

In some countries, because of the Great Resignation currently happening, companies have had to increase salaries to retain their departing staff. This contributes to an increasing inflation. I don’t think that salaries are increasing in Mauritius yet but I might be wrong…

Consequently, as demand is increasing, sellers are increasing the prices for products and services (and this is what inflation basically is).

The disruptions in shipping and logistics are also contributing to increased prices. There are also chip shortages for important electronic products.

Why high inflation is bad?

High inflation means high prices and poor people will start having difficulties. This is already happening in many countries and can give rise to social unrests.

Companies also suffer when inflation is high as they buy their raw supplies at higher prices. They are forced to sell at a higher price too to keep their profitability (or they need to lower their expectations or decrease production).

If inflation continues increasing, then there is the risk of hyperinflation. This has happened in the past in a few countries.

How does central banks limit inflation?

The best way to control inflation is to incite people and companies not to consume or purchase too much. The way to do that is to increase the interest rates on savings in banks.

Right now, it is around 0.4% per year in Mauritius and, with a 6.3% inflation rate, people have (nearly) zero incentive to save. Better use the money, which will be worth 6.3% less next year, and get the latest car or TV, they say.

The central banks will surely decide to increase the interest rate on savings this year. Of course, people will save more and, hence, the economy will slow down. Similarly, borrowers will have higher interest rates to pay which will also incite them not to borrow too much thereby slowing down the economy even more.

But slowing the economy too much is as dangerous as letting prices increase.

Central banks will definitely have to be careful in their approach.

I am trying to understand what to invest in (securely) in times of high inflation. I will write a post on that. Meantime, please free to offer your suggestions in the comments section.

Mauritius becoming a Knowledge Society

By Leave a Comment

Google is 23 years old today: the company started in 1998, the year Christina and I were finishing our studies in France.

Within a few years, Google would perfect its search engine and create all the novel products it is known for today (Android, Gmail, etc). I do not know much about the way the company works and, maybe, this is one of the few things I regret. I was interviewed by Google in April 2007 but I was not offered a job there. I wonder how my life would have been different if I had obtained the job. Or, in March 2008, when I was offered a job in San Francisco by a consulting company but I had to decline because of the infamous Global Financial Crisis then.

Anyway, for the past 23 years, Christina have been in Mauritius. And we are very happy to have lived this quarter of a century here. We have had two wonderful kids who are big enough to fare for themselves now (and they are not spoilt) and we have managed, over the years, to forge formidable memories with family and friends (and these memories are preserved thanks to public photos and private videos).

In many ways, the world we live in today, where I can easily speak to my daughter in France every day, is one imagined by the founders of companies such as Google, Apple, Facebook and Amazon. They dreamt of an always connected world and we are living in one now.

I also need to pay tribute to all the UNIX and Linux geeks in the world. Thanks to them and over open-source software developers all over the world, software works. Most of the formidable things we admire today (think Tesla cars or the datacenters of Google or Amazon) are powered by Linux and open-source software. Apple is also a major user of open-source software, most notably BSD and Mach for its operating system, macOS.

Of course, not everything is rosy for the Mauritian population. Some people are still on the other side of the digital divide and some still do not know how to use technology for enriching their lives. And, to be blunt, some use technology to (try to) keep people in the dark ages…

But one thing I have been thinking about for a long time now is to use the existing technology infrastructure in Mauritius (the fibre, the Internet and the myriad of online services provided by companies such as Google), to transform the country into a Knowledge Country, not only a Knowledge Economy.

I think that our people are sophisticated enough to form part of a Knowledge Society.

What do you think? What does a Knowledge Society looks like? How can we create one? How can we reach enlightenment?

How to (really) learn

By Leave a Comment

Yesterday, I watched an intriguing video on YouTube called How I’d Learn Music Theory (If I Had To Start Over) and, interestingly, it’s not really about music theory only but is about how to learn in general. One of the key recommendations was to read articles from research journals and, because the video was about music theory, a peer-reviewed journal called Music Theory Online was mentioned.

In it, I found this interesting research paper, which is actually an “essay”, by Jeremy W. Smith from the School of Music at the University of Louisville in Kentucky, USA. It is about how modern music uses pitch slides (glissandos), crescendos, fade ins, accelerandos, and filter sweeps (which the author calls continuous processes) to create excitement and tension, compared to more traditional notes, melodies and harmonies (which are discrete). Clearly, the author had a lot of fun and is surely a fan of EDM like me.

Underlying everything in the video is the fact that, instead of learning theory for the sake of theory, one should learn enough theory in order to get interesting things done and then learn more of the theory to get more interesting things done, etc., etc. And connect things which were previously disconnected.

By coincidence, I also read The Age of the Essay by Paul Graham yesterday, and he says: “Study lots of different things, because some of the most interesting surprises are unexpected connections between different fields. For example, jam, bacon, pickles, and cheese, which are among the most pleasing of foods, were all originally intended as methods of preservation. And so were books and paintings.”

I fully agree with these sentiments.