Adjacent possible was coined by scientist Stuart Kaufman.
It includes all the things possible; just next to what we have already achieved in a technology or idea.
For example man picked up stones to break nuts. Next possible change it saw was that heavy stones work better.
Then man found that sharp stones work better. Then, stones that fit between thumb and finger work better.
Then, man found that stones tied to a stick produce greater force.
Then, he found metals and made tools with metals. Then, he inserted batteries in tools like drills.
Each discovery led to next possible discovery.
And exploring next possible thing slowly, man reached present time of nuclear weapons, with which he can terminate his eternal stupidity and greed.
So one development in a technology opens doir to next possible improvement or addition, which is a slow process happening by contribution of multiple brains.
Adjacent possible is next possible improvement in present idea or technology.
It is not infinite.
It presents infinite possibilities out of which few are useful or meaningful.
It is slow and continuous.
Its boundaries grow as new possibilities are added or arise.
It applies to living beings and non-living things too.
Initially computers were text only medium. Then possibilities kept adding on to it and now you can post your photo or thoughts at the flick of your thumb, which similar sapiens all over the globe can see.
Hence, whenever you work with your ideas keep an eye on what is the next possible valuable addition to this idea.
That’s where next big thing resides.
Also keep searching your adjacent possible. You were not same in the past and you will also change in future. Keep jumping into adjacent possible of yourself and keep improving like all technologies do with time.
Right from the time, when we wriggled out of the sea water and started infiltrating all over this planet; we always needed fiction to survive.
We needed myths like Gods, states and religion.
Man needed stories to stick to. We needed groups to be part of and we needed feeling of, “us and them” to feel purpose in our life.
Then ideologies corrupted our minds. Some followed communism; which raised right questions but provided few solutions.
Few followed capitalism; that solved many problems but gave birth to extreme inequality and ecological disturbance.
Communism still holds firm in many countries; especially in Eastern parts of the globe.
Communism is basically,” from each according to his ability and to each according to his needs.”
In this all property is owned by the community and each person contributes and receives according to his ability and needs.
Communism is still deeply ingrained inside every inch of capitalism and we don’t even observe it.
It is necessary for capitalism to flourish and spread.
In the house joint family members share their possessions with each other. They earn them by capitlistic market and then put to use based on communist principles.
When we get out of house; we ask strangers for directions free of cost. We may get shelter under strangers umbrella. Somebody may tell you that you forgot to remove stand of your bike, without charging money.
In office, your senior colleague may answer your queries or act as a mentor free of cost.
Now see Facebook and Instagram. How much money they would earn if people didn’t share their pictures and art free of cost.
Would Amazon feel the same, if reviewers didn’t post product reviews for free on it.
So, capitalism may boast of anything but it is nothing without this daily communism.
Elinor Ostrom took this idea to her heart and studied how humans can judiciously share common resources without need of a state or autocracy to intervene.
This concept of commons need to reach more people and should be recognised for its vital role.
Her studies got Elinor Ostrom; Nobel prize in 2009 but still capitalism with its bright lights is outshining the garden of commons.
When human beings started as a hunter gatherers, it was relatively easy to be happy. You needed few things to be happy. You needed food, water, warmth, safety and a family and you were okay.
Their were no stocks, bills or quarterly targets.
As time passed, hapiness got increasingly attached to external things. It depended on things you could gather and then feel happy by displaying those things to others. Humans started collecting land, money, metals, fat and servants.
But then things got more complicated. It was still hard to be happy.
They stocked more and more stuff,only to see that it got outdated before they could earn enough to buy its next version.
They needed pills more frequently to be happy and feel meaningful.
As incomes grew; after a particular level of money; hapiness stayed the same.
So, it was probably wrong approach to achieve sustained hapiness free of transient dopamine spikes.
Only when hapiness is detached from the external things, tgen only it can become stable and eternal.
When I read , courage to be disliked, I realised it was the simplest philosophy to be happy. Although it was hard to apply fully in real world; but it provides framework over which sustained hapiness could be developed.
I will share few of these concepts of Alderian psychology in this blog with illustrations.
Here we go.
1. Think in terms of teleology and not in terms of aetiology.
Aetiology is cause of an event. Teleology is purpose behind that event.
For example if somebody is depressed, we may deduce that, he is depressed because of his troubled home environment. ( Aetiological explaination)
In teleolgical terms, person has created depressive symptoms to avoid the effort of sorting out causes of his depression. ( Teleological explaination)
So, if we start seeing things in terms of hidden purpose, in stead of exact cause; it will be easier to start acting for improvement of the condition.
Aetiology provides difficult route to a solution. Teleology makes it a bit simpler. Aetiology gives causes, teleology guides towards possible solutions.
2. Stay away from life lies –
Life lie is lie that we make to avoid change. We shift blame from ourselves to someone else.
Like feeling inferiority to avoid being courageous enough to change your circumstances. It is easy to stay locked in home by constructing life lie of inferiority complex; than going out to face your fears and making best of whatever talent you possess.
3. Once you find purpose behind a particular symptom, you need to accept yourself and move ahead in spite of the fear. You need to have courage.
As all great minds have said, we choose our emotions, our reactions to a particular event and meaning that we provide to a certain event.
If you accept these, you give yourself power to change.
Humans are slow to change. Change needs courage. Change is inconvenient. Change needs sacrifice and pain.
We rather choose to avoid it. We may create symptoms like anger, impulsiveness, depression, irritability, inferiority to avoid the change. Our purpose of all these symptoms may be an effort to avoid process of painful change.
Better thing is to see that you can change situation with hit and trials using courage and assistance from your family, meditation or your doctor.
First you need to know that you have power over your response and thoughts.
“Think I have ability.
4. All problems are interpersonal problems.
All problems can be seen as problems arising out of our relationship with others and situations.
Don’t put your happiness in the hands of external things. Other people or things or situations. This will free you of a lot of burden.
Keep out of useless competition. Don’t get sucked up into useless struggles, to prove your superiority to anyone. Even if you are correct, don’t assert your yourself. If you are right, don’t sweat to prove it.
Don’t fall in trap of reward punishment circuit.
Step back and show no reaction. See problem in the circumstances, not in the particular person.
Life is not a competition. Don’t compare with others, compare with your old self. You should be improving with time.
5. Develop feeling that all people are my comrades. Develop horizontal relationships.
All humans are not same, but all are equal. Consider everyone as your friend or comrade.
It gives you power to think positively and to stay away from negative feelings. This will give you ability to see their perspective. It will solve a lot of problems.
Treat everyone as equal with no bias or hierarchy. It gives community feeling. Know that you are not centre of the universe and don’t expect many things from others. See what you can contribute, in place of what you can get.
6. Seperate tasks –
See clearly which is your task and which is not. If it is not your task, don’t overindulge in its execution. Provide nudge or guidance but don’t do it yourself.
For example, if child is not studying well understand that it is his task. Tell him that studies are necessary for him. Provide for tuition, reading space and help whenever he requires. But don’t force things on the child or punish.
Let him walk his path himself, so that he learns to face life alone.
7. Know that contribution leads to hapiness –
If you contribute to society and other people, your feeling of self-worth and hapiness are exalated. Believe in others. Don’t generalise things.
Few bad events or people don’t make everything bad.
Contribute according to your ability. But still know that person is worthy for being or existing. His contribution increases this worth.
8. Know that life is a journey, not a destination. Life is a series of dots, it is not a straight line.
To summarise everything.
See purpose of an event or action. Seperate tasks. Focus on internal drive for hapiness. Treat everyone as comrade. Solve interpersonal issues. Have courage to change.
It is eye-opening write-up. It tells us that; even if intentions are good and legislation in place, still beneficiary may be deprived of a benefit due to misinterpretation of things and complexities of a process.
In year 2015, as people tried to flee to better lands amongst middle eastern Syrin war. As many as 4000 refugees drowned in meditarranean sea; as they tried to cross it with inflatable boats.
They paid loafty money to mediators and found themselves with their families; in the middle of no where.
This happened in spite of Geneva convention aggrement; which enables refugees from Syria to seek asylum in Europe.
But, when people tried to reach airports they faced effects of anti illegal immigrants directive, which was designed to stop illegal immigrants. This directive required airlines company to ship back illegal immigrant for free.
Hence, on airport counter every asylum seeker was seen as illegal immigrant. Hence Geneva convention failed to help them due unclear and complex process.
Why didn’t they use good boats.
Because, there is EU policy to confiscate illegal boats. Hence, if people used boats they will be captured and gone
Hence, desperate people used inflatable boats which are very unstable and risky.
Hence inspite of remedy (permission of asylum under Geneva convention); it was really hard for refugees to reach Europe to seek asylum.
Sorry, for the heading of the blog. This was to get your kind attention.
This blog is about stocks, also known as shares, with particular focus on Indian general masses, who want to enter and explore share market.
It is simplified basic knowledge about share markets.
Babies will not need it. But their dads will need it, to secure their future. Hence in a way this blog is for those babies too; who are going to discover in future, that their daddy knew next to nothing about economics and investing.
As uncertainty, looms in the economy with unpredictable future, you need to have knowledge about all the spheres of the investing.
If you have money, it should grow with time and this can be done by wise investing.
So let’s clear our basic doubts about shares.
First let’s clear biggest confusion according to my analysis. It is terminology which blogs use to explain shares. It is confusing.
We must know that ;
equity = share = stock = security
First you should know this fact that they call shares with so many names. As different sources write different names, it can be daunting. They all are interchangeable.
We will use term share in this blog, to avoid confusion.
“Share is a physical or digital certificate that gives buyer partial ownership of a business.”
Let’s imagine a business is worth 100 rupees. Its owner divides this into 100 shares each worth 1 rupee.
Now, he puts them in stock market ( stock exchange) from where people can buy or sell these shares.
So, if someone buys 40 shares of this company, he becomes 40% owner of the company. Any one who invests 1 rupee, he becomes 1% owner.
So shares help businesses in raising money for their operations.
His investments are now dependent on the performance of the business. If it grows, he earns money and if business falters, he looses money.
He can buy or sell shares anytime on the stock exchanges.
There are two main stock exchanges in India –
1. The Bombay stock exchange ( BSE)
2. The National Stock exchange ( NSE).
Companies are listed on stock exchange. And only listed companies can sell their stock in stock market.
These are regulated by SEBI ( Securities and exchange board of India); which is a statutory body responsible for fair working of the exchanges.
It penalises for wrong practices and frauds and formulates rules and regulations for working of stock exchanges.
Hence, one can invest money in stock market without worrying about frauds or cheating, as far as stock companies are concerned. Whole system runs on trust.
These days stocks are available in digital format and can be easily purchased or sold using apps like zerodha, Angelbroking etc. Whole process is very simple.
You need to make a demat account with regulator and after kyc verification (know your customer) verification; you can purchase and sell from comfort of your home.
How does initial price of a stock is decided?
It is random value in decimels decided by the company promoters. After that performance of the business and demand and supply and perceptions about future decide the price of that stock.
Total number of stocks issued is called total shares outstanding.
If we multiply number of shares issued with the price of one share, we get market capitalisation ( market cap) of the company.
All companies listed on stock exchange are divided into groups based on market cap.
1. Large cap –
Top 100 companies in terms of their market capitalisation. These are safer and successful companies. Examples in India are TCS, HDFC, L and T, wipro etc.
2. Mid cap –
101-250 in list of companies based on market capitalisation. Examples are pfizer, emami, bayer etc.
3. Small cap –
Above 250. These are generally lesser known volatile companies.
Now based on performance of the company, its management, brand value, public sentiments and many external factors like war, disaster, competition, fads;there are fluctuations in the price of stock in the market on day to day basis.
But generally in long term ( 10-15 years ); if business of the company is sound, it results in rise in stock price over time in spite of the short term wide fluctuations. Hence stock market investment is for long term.
If you don’t have 10-20 years of time to let your money grow, it can be less fruitful mode of investment.
What happens when stock prizes rises?
Company can give you part of the profit, that is called dividend.
Or it may hold extra cash for liquidity and expansion.
It may invest gains for further expansion of the business.
Why the people worried about Sensex rising or falling. What is this sensex?
Sensex is a metric using which we can guess overall performance of the economy.
We can’t check each and every stock daily. So we have devised a simple measurement number. It simplifies monitoring.
Sensex and nifty are such numbers. They are stock market indices. They tell the direction of the market, whether towards positive or negative.
Sensex belongs to Bombay stock exchange. It is made up of 31 hand picked companies, which are picked by private firms.
For example, sensex companies are picked by Sand P global. Companies are not fixed. Based on performance new companies enter and go.
Nifty belongs to the national stock exchange. It is made up of 50 stock. Hence, it is called Nifty 50.
Hence, next time you see a news anchor worried about fall in sensex, you will know that, she is talking about the performance of choosen list of companies on that day. Their performance is averaged based on their size and sector.
Few more terms that you hear everyday.
Bull market – when the market is on the rise like horns of a bull.
Bear market – when market is on fall like a crouching bear.
Blue chip companies- companies which are reliable performers.
What is initial public offering?
IPO – Initial public offering –
Each company starts as a small privately owned company. With Time it grows and it needs more money to expand. It then lists itself on Stock exchange, so that anyone in public can buy its shares as IPO. It raises a lot of money for the company.
A board of governors is appointed to oversee working of the company. Its data and performance are public. It is responsible to its shareholders for maintaining good performance.
Hence, IPO is the initial offering stock by a private company, which enlists itself on the stock exchange so that its stock can be bought and sold by general public.
This blog is aimed to provide introduction to the share market to Indian readers.