By
Siddhartha Rastogi
The History
On 28th June 1914, Franz Ferdinand, Archduke of Austria and Sophie, Duchess of Hohenberg, rulers of the Austria-Hungarian Empire, were travelling in a motorcade to address the town hall at Sarajevo. An assassin hurled a bomb on Ferdinand’s car. The bomb bounces off the car and explodes in the next car, wounding 20 people. Franz and Sophie, unhurt, reach the town hall, and address the crowd waiting for them.
After the town hall, Franz and Sophie decide to abort their next program and instead head to the city hospital to see the wounded. This time they took a different route to avoid the city centre where the bomb was thrown (this was unplanned). In severe confusion the motorcade continued with the original plan whilst Franz and Sophie’s car moved ahead without the rest of the security personnel. The driver of Franz and Sophie’s car took a wrong turn, where another Serbian assassin shot both of them at point blank range. As a result, the Austria-Hungarian Empire bombed the Serbian capital. Russia, a supporter of Serbia, mobilized against the Austria-Hungarian Empire. Seeing Russia’s intervention, Germany, an ally of ther Austria-Hungarian Empire attacked Russia and the First World War breaks out killing 20 million people and wounding 21 million humans.
What has World War I got to do with Chaos Theory?
What is Chaos Theory?
Somewhere in the 17th century Newton anointed the theory of Determinism, which helped humanity find out the position and movement of earth and other planets in the solar system. The theory in simple terms defined the outcome, if you know the initial position of the object and the quantum of force applied on it.
In the middle of the 20th century, American mathematician Edward Lorenz, whilst finding the pattern of weather incidentally propounded the CHAOS theory, which stated,
“Highly dynamic amd complex systems, which produce constant chaotic outcomes, have a regular and set pattern”
This means, in context of life, weather, relationships, complex machine systems, it’s difficult to predict the outcome every time, due to a multitude of variables, however one can see the similar patterns in longer cycles, even if the outcome every time is random.
This theory led to another discovery known as the Butterfly effect:
“Any small change in initial conditions can lead to a significantly large and different outcome.”
As we noticed from the above story, where a wrong turn by the driver led to the First World War which killed~ 20 million people, one butterfly flapping its wings in Hong Kong can lead to a tornado in Brazil.
If you think deeper on the subject, this is true in life. The biggest fights, the biggest arguments and finally biggest consequences happen on the most trivial issues.
The Pulwama Attack Feb 2019 (India): The attack on Indian Soil which killed 40 bravehearts, 40 sons of soil was executed by a man named Adil Ahmad Dar. The reason Dar was unhappy and upset was, when he was still in school, he was asked by local police to rub his nose on the ground and draw a line around the police vehicle. Since then he had resentment and a grudge against the establishment that led to one of the deadliest attacks on Indian soil by terrorists. Who knows what other events will transpire from here.
However, the butterfly effect can also make your life hugely successful. Five minutes of mindful meditation and ten minutes of daily exercise can do wonders in your quality of life and health.
The Business
With regards to investments, a small decision to have good quality companies with high level of corporate integrity in one’s fund manager’s portfolio can ensure socially unresponsive and poorly managed companies don’t get valuations or investors in the stock market. When capital markets are gripped with uncertainty and fear, these kind of companies are dumped by shareholders first, creating a downward spiral, thereby eroding wealth for everyone. If during good times, one decides to stay away from these unethical, bad and dirty companies, eventually these kind of companies and businesses will cease to exist, creating a healthy and positive business and a capital market environment which is not gripped with fear.
Sport
Finally to end the note, another short inspirational story:
Another Serbian, Novak Djokovic, a professional tennis player who is currently ranked world No. 1 in men’s singles tennis.
Djokovic has won 15 Grand Slam singles titles and is the first and only male player to have won all nine of the Masters 1,000 tournaments. Djokovic is the first Serbian player to be ranked No. 1 by the ATP and the first male player representing Serbia to win a Grand Slam singles title.
This is what everyone knows.
What you don’t know?
In 04-05, he was ranked 682 in the world, winning 49% of the matches he played earning ~USD 300,000 per annum in prize money and endorsements, which were barely there. He also used to win only 49% of the total points played.
What’s remarkable is, by making small changes in his decision making, practice and approach to his game, he started winning 52% of the total points by 06’ -07’ he played from 49%. By just improving 3%, he moved from 600+ rank to 3rd rank in the world of tennis, winning 79% of the matches earning 5 million USD per annum.
With another 3% from 52% to 55%, improvement in points he wins, he became the no.1 tennis player in the world, winning 90% of the matches he played earning 14 million USD every year.
Thus Siddhartha Rastogi says, “Small, optically insignificant changes can lead to great desired results in life and humanity. Just Keep pursuing your dreams, by taking baby steps every day.”
Siddhartha Rastogi
Siddhartha was born to a learned middle class educated family in Semi Urban India. His father was an extremely honest man who because of his honesty had to pay the price in corporate world. Mother is a determined woman who ensured that children are being well taken care off. After a few years of birth, doctors called Siddhartha, a slow child having flat foot. He would fall more than he could walk. Determined mother ensured all therapies for her son to come out strong to fight the world. Siddhartha joined swimming when he was in 6th standard. Seeing other children of his class, he jumped in 10 feet deep pool and learnt swimming on his own, the very same day.
From that day there was no looking back. He topped his city in 12th and went to score highest in his B school exams. During his profession as banker, he became youngest branch manager of a MNC bank managing their biggest wealth branch in the country. There he found love of his life and got married. His love of his life emerged in the form of his daughter who completely changed him for good.
Siddhartha Rastogi is Director for a boutique Investment bank in India.
Siddhartha is a forward looking thinker & writer who has written a book on decision making. 8 Simple steps to effective decision making.
He writes on various social and current issues via his blog and can also be found on twitter.
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