Wednesday, March 19, 2014

Tsarist Ambitions...Seeds of Cold War II

Trust Vladimir Putin to define the Russian version of 'Cowboy'.Words like annexation,acts like taking over of parliament by Russian supporters etc sound anachronistic in the 21st Century.The Tsars must finally be finding some common ground with a communist after lying in the graves for more than a century.

But read your history of the last 150 odd years and somehow it does not seem surprising at all.The old wars are being fought under new aliases is all.

The graveyard of Empires continues to be so.Afghanistan.

The British,Russians and now the American coalition driven out by a bunch of fanatic tribesmen.Simple tech or firepower sometimes does not work along expected lines.

The adventures in Ukraine,Crimea signifies a new order where a powerful nation state can steamroll legitimate countries,usurp territory,browbeat the politics into submission as long as it has the natural resources to take on the World.A Russia full of natural gas,oil and gold reserves has silenced Europe for no Prime Minister worth his political salt would have the gas tap turned off or see an unprecedented increase in prices sudden enough to upset all calculations.

A stifled President Obama and non existent United Nations is guilty of simply standing by.Will China take this as an opportunity to annex spratly islands from Vietnam,Phillipines,Japan?Will it launch a raid to capture Ladakh,Sikkim and Arunachal from India.That after having completely swallowed Tibet.

A decade after the American led forces dismembered former Yugoslavia to form Serbia,Bosnia,Montenegro,Kosovo etc ad the USSR dismembered itself,the World is set for another round of geographic battles.

Rather than a cooperative ambience across the globe to battle hunger,greenhouse gases,shrinking wildlife habitats......we are back to taking the planet to the brink of another armageddon.As if sundry uprisings in Syria,Libya,the simmering palestine issue and a generally unsettled Asia weren't enough!

It seems that the Russia-China axis will take on Nato led sanctions,more frightening is the emergence of a National policy that allows a military-economic power to impose its will on weaker neighbours.The destruction of an indigenous culture may take many decades but often enough the recovery takes many centuries.

India-still to emerge from the british indigo tax and the prohibition in manufacturing has yet to regain its basic industrial shape six decades after indepence.More countries will slip under the shadow of a dominant neighbour.Multi national companies that held sway finally have a competitor in the form of one Super-president.Will there be more...?

Tuesday, March 4, 2014

Early 2014 Themes...

This is going to be a short post but something I really feel needs to be said...

Indian Elections:The crux or fulcrum so to say on which the outlook for the entire economy depends.Mr Modi wishing to turn every state into Gujarat(hope he doesnt intend to turn it into the Kutch desert!),Prince Rahul wants to learn how to give more sops to the poor,AAP just bothered about bringing out lists naming corrupt politicians,businessmen,bureaucrats and sundry.Conviction -  Null.

Stock Markets:Lacklustre,in wait and watch mode till the new financial year.The fiasco with United Bank of India(UBI),highlights the inherent faults in PSU firms-used as pin cushion for various bureacrats,ministers.The PSU banks need recapitalization to bring them upto par with Basel III norms.

Global News Factor:The Russian shadow on Ukraine will not go away quickly or quietly.President Putin in his desire to leave a legacy that will make Russians proud of him.He controls the natural gas supplies to Europe but the brutal plummet in Bond prices on the rumoured Russian invasion shows that the economy faces huge headwinds.
The quiet rise in terrorism related incidents in China are spreading from Uighur province to neighbouring areas as well.Pakistan and China use it as strategic policy and shows that some amount of blowback is happening.Although small and controlled at present it could give security forces a huge headache in the future.

US:With a new head Fed(pun unintended!)its upto Janet Yellen to bring up the US economy to speed.Jobs,manufacturing are still nascent and will take time to turn around.Important to see if she still feels like rolling back the liquidity tap as per schedule.

Fashion Sells:In the Indian context the amazing sales of the 'Bullet' motorbike by Eicher Motors show how an old brand can be revitalized by competition.In my travel across major metro and non metro cities I found so many new 'Bullets',a once has been with limited fuel efficiency and strained maneuverability on narrow Indian roads.BUT the entry of Harley Davidson and the return of 'machismo'has resulted in aspirational buys.Eicher looks like a good investment.

Somewhere in mid 2014 all these factors will come together to either propel or retard the Indian growth story.The "Fragile 5" and all that makes good copy but as seen through the decades,India endures.There are enough resources and (I hope)enough sensible leaders to ensure that the country can keep the Manmohanomics story going.......

Qui Desideret Pacem
Praeparet Bellum
                                - Flavius Renatus
<Let him who desires peace,prepare for War>