Monkey see, monkey do in the Year of the Monkey?

It is beginning to seem increasingly likely that the global economy may plunge into recession towards the end of this year. Last month the European Central Bank cut interest rate to minus 0.3% and promised to continue its bond buying program to March 2017 or beyond. Then a few days back the Bank of Japan reduced interest rate to minus 0.1% while continuing its $666 billion bond buying program. Negative interest rates are meant to discourage savers from saving money, so that increased spending will stimulate production and create jobs, and force banks to lend money by making it expensive for them to park funds with the central bank. Critics say that it is just another way to devalue the currency by forcing foreign funds to look for returns elsewhere. However, while the yen fell on the news the Euro gained 2% against the dollar. No one is sure as to what is going on in China. What everyone is sure of is that the Chinese stock market has been falling despite government support. Part of the problem is that companies with political connections list on the stock market so the government is forced to prop it up. The Peoples Bank has poured $52 billion into banks to increase liquidity before the Chinese New Year holidays. It will be the year of the Monkey and an improvement in global economy is predicted. China is worried about the flight of capital as people fear that the yuan will continue to drop in value against the dollar. Foreign reserves have fallen by $700 billion and an article has warned George Soros, famous for making $1 billion in 3 days by short selling the pound in 1992, not to attempt the same with the yuan. Which may turn out to be a red rag to a bull. Oil prices have collapsed which is disastrous for economies like Russia and Venezuela and is even forcing Saudi Arabia to increase the price of fuel for its own citizens and to sell shares in Aramco. Sanctions on Iran being lifted will depress oil prices still further as Iran tries to catch up for all the wasted years. Whether the increased economic pressure on Arab oil producers leads to greater disturbance in the middle east remains to be seen. The US economy grew by just 0.7% in the last quarter of last year despite very low fuel prices, which is good for consumers. The strong dollar is hurting exports. Apparently," the bond market has been screaming recession for weeks ". High yield bonds or junk bonds are in meltdown which is another sign that the US economy could weaken. The Swiss government proposes to pay every adult 425 pounds and every child 100 pounds to end poverty. No 'targeted subsidy' here. Switzerland already has a negative interest rate and this maybe a way of increasing spending and creating inflation. A global scenario of monkey see, monkey do. It is the Year of the Monkey after all.

Can the GDP grow while production is falling?

Why are politicians constantly harping on the growth rate of our GDP, or Gross Domestic Product? GDP is a total of all the goods and services produced by the country and thus is a measure of the health of the economy. A robust growth rate gives bragging rights to the party in power although it means nothing to citizens because our comfort is dependent on our ability to earn a decent living without our lives being made difficult by arbitrary rule changes, such as the odd-even car restrictions in Delhi, or the lack of basic services, such as good roads and constant electricity supply. In terms of GDP India is apparently the fastest growing economy in the world, with the GDP growing at 7.2% in the first half of the financial year. If the economy is growing so strongly then more wealth is being created, demand must be strong and industrial output must be soaring. But other figures do not support such a conclusion. The Purchasing Managers Index for manufacturing has been falling after a spike in July and the Wholesale Price Index has been falling for over a year. The capital goods sector, which indicates new investment, fell by 24.4% and yet Consumer Prices increased by 5.6% in December. How is it possible that the economy is growing while production is going down? Private consumption provides 57% of total demand and 54% of total consumption is spent on food, which means that food accounts for 31% of total demand. Food prices for consumers have risen by 6.3% but the wholesale price of food has risen by only 0.6%. So, the bulk of the rise in food prices has been due to trading in food, writes a professor. It is this that accounts for the high GDP growth. High spending on food means that households have less money to spend on consumer items, which accounts for falling industrial output in a high growth economy. To give a more meaningful picture Ambit Capital has come out with India Keqiang Index, after the Chinese Premier Li Kiquang, which is based on auto sales, capital goods and power consumption. This gives a growth rate of around 6% year on year. Falling demand means falling profits, which hampers companies from servicing their debt. This is proved by a 14% rise in pledging of shares by promoters. The proportion of shares pledged by promoters has risen from 27% of total holdings to 47%, from Rs 1.28 trillion to Rs 2.03 trillion. The other indication of poor output is the rising volume of bad loans in public sector banks. Exports are also sliding because of the weakness in the global economy. So the trade deficit is increasing. If more capital flows out the rupee will fall and so it is. How can the economy be growing so strongly when everything is going down? All very strange.

Zika will not be noticed in Delhi.

The government of India is to issue a travel advisory, asking pregnant women not to travel to countries suffering an epidemic of Zika virus disease. Earlier the Indian Medical Association issued a similar warning to pregnant women. What is the Zika virus? Apparently it is a virus related to dengue, chikungunya and yellow fever which was first detected in monkeys in the Zika forest in Uganda. Hence the name. Monkeys are the natural reservoir, like in the case of the Ebola virus. There is some anecdotal evidence of the virus spreading through sexual liaison so the advisory should surely include men as well. And not just recently married young men. An old man may carry the virus back to India and then get bitten by an Aedes aegipti female who then spreads it to a young woman. Also Ascending Paralysis, or Guillain-Barre syndrome, can affect men as well as women and, as the name suggests, weakness usually starts in the legs and spreads upwards to affect respiratory muscles, requiring ventilation in an intensive care unit to keep the patient alive. Treatment is therefore very expensive. Logically, the advisory should include everybody. Trouble with the Zika is that 80% of people get no, or minimal flu-like symptoms, which they ignore, but it has a devastating effect on the baby, causing a small head or microcephaly. In that respect it behaves like the German measles or Rubella virus. The vaccine for the Rubella is included in the MMR vaccine and is mandatory for every baby. Apparently it is difficult to test for the Zika because it cross reacts with antibodies to dengue, chikungunya and yellow fever. Anyone travelling to African countries where yellow fever is endemic must take a vaccine before travel. The other 2 diseases have no vaccines as yet, although a vaccine against dengue is in Phase III trial. We are told that the Zika virus is 'spreading explosively' in South America because people there have no immunity against the virus, but if there is cross-reactivity with other viruses then they must have at least partial immunity to the Zika. The BCG vaccine against tuberculosis, caused by Mycobacterium tuberculosis, seems to offer some resistance against leprosy, caused by Mycobacterium leprae. Delhi reported 10,683 cases of dengue last year because the AAP government did not get the drains cleaned before monsoon, resulting in stagnation of water, which is ideal for breeding mosquitoes. 41 people died. Vast number of mild cases must have gone unreported. Municipal workers in east Delhi are on strike because they have not been paid, causing garbage to pile up. If the Zika does get here we can expect an epidemic. Maybe there has been an epidemic already, causing small brains. That may explain why people voted for this gang.

Why would you want power if not for gain?

The Corruption Perception Index published by Transparency International scores India at 38, the same level as 2 years ago. Transparency International is an NGO, based in Germany, which defines 'corruption' as " the abuse of entrusted power for private gain ". By that definition wealthy parents, occupying high posts, using their network of friends to give their children a higher start in life maybe deemed to be corruption. Real corruption comes from politicians and civil servants, who use the system to enrich themselves and pass laws to make themselves immune to prosecution. Like the CBI having to seek permission from the Governor of Maharashtra to charge a former chief minister in the Adarsh scam. Predictably Congress has accused the BJP government of using the CBI for political purpose. All this circus gives plenty of time for a fire to start 'accidentally', destroying all evidence, as it did in June 2012. Three people died in that fire but no one has been charged with arson. The 'honest' Nitish Kumar government in Bihar is withdrawing all cases against Mr Lalu Prasad Yadav and family. Nitish Kumar cannot claim to have no knowledge of Mr Yadav's friends as our former Prime Minister does about all the scams that looted trillions of rupees during his 10 years in office. There are enormous protests across India about the suicide of a student in Hyderabad, who had been expelled for protesting against the hanging of Afzal Guru, a filthy terrorist. Yet there is not a whimper about the suicide of 3 girls in Tamil Nadu who had paid hundreds of thousands of rupees as fees to a college, but were not being taught anything. Education is big business in India with desperate parents paying millions for their children to get admission to professional colleges. There are allegations that the limbs of the 3 girls were tied, which would make it a triple murder. This is where politicians earn their share of the spoils, by forcing the police to declare it as suicide and confuse evidence so that no one can be convicted. Where are all the howling liberals when you need them? For some reason outrage is very selective in India. Mystery. If the death of a high profile person like Sunanda Pushkar has been thoroughly muddied what hope 3 girls from poor families have of ever getting justice. Sandal wood smuggler Veerappan killed police officers at will and yet got away every time. Dawood Ibrahim wanted to surrender but no one apparently wanted to arrest him. When coated with so much mud it is no surprise that politicians spend taxpayer money on advertising themselves, like whitening creams. If no one believes you in India why not advertise in foreign papers. At least the corruption is transparent. We can see it.

How will they distinguish between refugees, migrants or terrorists?

This year is going to be very unpredictable. The war in the middle east goes on, a previously unheard of virus, called the Zika virus, is causing microcephaly in babies in Brazil, the global economy could fall into a recession, China's growth is slowing down and the US is in the middle of its election jamboree. But it is Europe, thinks a professor, that is going to decide the geopolitics of the world. The many challenges facing Europe are recognised by the President of the European Parliament who thinks that nations could yet unite to solve the problems. " It is time for Europe's leaders to break the decades old habit of pursuing half-baked projects that blunt the symptoms of crises, and to implement real reforms that address root causes," he writes. " If Europe's leaders are to inspire their people to build a shared future, they must demonstrate an understanding of what the future has in store - and how to make the most of it. They should start by changing attitudes and committing to working together to face present and future crises head-on." Pious words. But just when we thought that a united Europe will follow common policies he recoils." My call for a renewed commitment to the EU does not stem from some federalist mantra," he hastens to correct himself. Exactly. The European Union is an assortment of 28 nations, each with its own elected government and different economies but with no control over monetary policy, which is set by the European Central Bank. That has created a north-south divide where the rich north feels that the south must become more competitive, while the poor south feels that the north is being vindictive. Perhaps, the migrant crisis will create a crisis that will decide whether the EU breaks up behind barbed wire fences or unites in a federal Europe where policies are common to all. The EU has blamed Greece for allowing migrants to come into Europe to which a spokeswoman for the Greek government responded," This tactic of diverting responsibility is not an effective response to a problem of historic dimensions." The Syriza government in Greece may still be smarting from the severe austerity imposed on them by the Troika and presumably see no reason why they should be spending scarce money on migrants. Apparently, Germany is unable to locate 600,000 migrants out of 1.1 million that it has admitted. Many have multiple identities and cannot be tracked by official agencies. Denmark has passed a law to confiscate valuables from migrants, which has been criticised by the United Nations. Sweden is to expel 80,000 refugees, but where to? In Finland some are adopting the Ku Klux Klan. Further terrorist attacks are certain in Europe's cities. How long before we see all out war?

How can you have research without basic education?

A survey of 56 countries by a think tank in the US finds that there is virtually no innovation from India. The figures are dismal. India, which means the government, spends $1,248 per school student, less than Colombia and Vietnam. We are in the bottom six in government funding of university research, behind South Africa and Brazil. Funding of university research is just $12 per capita and we have only 17 universities in the top 800 in the world. When it comes to published research articles we have almost none. Tiny countries like Israel, Denmark and Switzerland are way up there. Of course, research costs money and India is a poor country but why are Mexico, Ukraine and South Africa ahead of us in publications? The rot starts in primary schools. Teachers spend their time supervising the cooking of midday meals in government schools,especially after teachers were arrested when 23 children died of pesticide poisoning in a school in Bihar. Naturally, children, especially in rural areas, come to school to eat and learn very little because teachers are busy cooking. It is not surprising that they learn virtually nothing. Imagine paying huge salaries to teachers who are busy cooking. If children have learnt nothing in school they are unlikely to learn very much in college, which is why 80% of engineering graduates are not fit to be employed. A college degree serves to makes a person more eligible in getting a sweeper's job and those with PhD degrees apply for jobs as peons. The reason is that government jobs pay regular salaries, there is no danger of being sacked for poor performance and there are no other takers for people with useless degrees. The government controls all higher education through the University Grants Commission which gives great powers to politicians and civil servants. Mediocrity is an asset. Last year only 246 MBBS seats, out of a total of 600, in Delhi were in the general category, which means purely on merit, the rest being reserved for various other categories, who received admission with much less marks. Professors are promoted according to seniority and not appointed directly, as in the west, based on research publications. So, while people of Indian origin in the US are known for their research work professors in India get appointed on plagiarism. Because of poor standards wealthy Indians send their children to the US for higher education and donate to US universities, rather than to Indian ones. US universities boast of billions of dollars in endowments. A previous minister made it a rule that all donations to educational institutions must go through his ministry. Naturally no one donated. Those in power benefit from the system. Why should they change it?

Economy a hostage to politics, is there any hope?

Economists cannot account for politics because the behavior of politicians cannot be calculated. Politics is the only reason why India remains poor while China, South Korea and Singapore have zoomed ahead. A paper on the effects of politics on our economy from 1993-2014 suggests that in the nineties deals were open, which means they were transparent, and ordered, which means they were honored. From 2002-10, during the Congress regime when commodity prices were booming, deals became closed, when mines were distributed to friends and relatives. When the extent of corruption became public and revenues dropped because of stagnant growth deals became disordered, as when the government tried to impose retrospective taxation. So, what is happening under the BJP government? " After a decade of ossification, the landscape is changing at a rapid rate for India Inc. as: (1) An unconventional PM calls time on the traditional model of subsidy funded consumption growth and crony capitalism driven capex growth in India; (2) A gutsy RBI governor brings about multiple policy changes to radically increase competition in the Financial Services Sector; and (3) Technology lowers the barriers to entry into sectors such as lending, consumer goods and auto," says a report by Ambit Capital. And therein lie the problems. After carefully constructing a system where a few made billions from resources and votes were bought with handouts, paid for by punitive taxes, the whole edifice is in danger of collapse. That is why they have stopped all business in the Rajya Sabha so that all reforms will be blocked. The monsoon session was because of alleged shady deals by Lalit Modi, the winter session because of an alleged murder of a 'minority' and they are preparing to disrupt the budget session because of the tragic suicide of  a Dalit student. It is not that they are concerned about issues but it is an attempt to find any cause not to let the Rajya Sabha function so that the economy cannot grow and they have chance to win power back in 2019. Market capitalization of public sector banks have dropped so low, because so much money has been stolen from them, that 5 banks can be bought for $1.5 billion, when a start up, like Flipkart is valued at $15 billion. The RBI governor is trying very hard to clean up the banking system but the crooks are very well protected. Finally, technology maybe lowering barriers to some businesses but the use of technology is limited only to those with the skills, which means millions of unskilled could become redundant. A daunting challenge for the government when 80% of graduate engineers are unfit for employment. Since we do not export bananas we cannot be called a banana republic but on our Republic Day we pray for a strong wealthy nation. May our enemies wither.

Why do we believe in publicity? Are we idiots?

In a stunning revelation it seems that there exists a Committee on the Human Rights of Parliamentarians. Most of us ordinary folk would think that we urgently need a committee to protect our human tights from parliamentarians. Apparently, there were 320 attacks in 43 countries in 2015. Africa topped the list with 36% of cases while Asia came second with 29%. Two-thirds, or 71%, of all cases are by opposition politicians. Not surprising, is it? When 186 out of 543 members of the Lok Sabha have serious criminal charges against them. We are not talking parking tickets or failure to return library books. We are talking murder, kidnapping, robbery and rape. However, there was an attack on our most esteemed Chief Minister of Delhi when a woman threw ink on him, to protest against his policies. Since he is not a Scandinavian blonde we cannot see any sign of ink on him but his henchmen reacted furiously to this 'attempted murder'. " They may also kill people because they cannot stand the success of the odd-even scheme and AAP's popularity among the masses," fumed one henchman. No one has ever heard of anyone dying from a few drops of ink and surely being such a popular leader of the Aam Aadmi, which means ordinary people, he should allow such a harmless protest? Not a chance. The woman has been released on bail, on a bond of Rs 10,000. If he is so popular why has he spent Rs 600 million on his own publicity out of Rs 5.26 billion kept aside for this purpose. With so much of our taxes used for bluffing people there was nothing left for cleaning the storm drains of Delhi, which led to a Dengue epidemic, with 10,683 cases and 41 deaths. Why such fury over a minor incident? Because henchmen depend on the leader to protect them from the law, while the power of the leader comes from intimidation of the people, by the henchmen. In Bengal this has got out of hand so that no one wants to invest in the state. The Chief Minister says that she has been promised Rs 2.5 trillion worth of new investments but she has received proposals, not actual investments, of just Rs 68.71 billion. The Chief Minister's protection of illegal immigrants from Bangladesh led to a mob of 250,000 attacking a police station in Malda district. Terrorists from Bangladesh have established bomb factories in Bengal and are now planning attacks on the Republic Day parade in Delhi. The condition of UP is dire. Like in Delhi, the Chief Minister of UP bought a flattering advertisement in the Financial Times. How much taxpayer money was wasted we do not know. Indian politicians must think that the citizens are imbeciles to fall for blatantly false publicity. They maybe right, because they keep winning elections.

Why not replace the adversarial system with service? Much cheaper.

A chartered accountant makes a heartfelt plea for a better direct tax system. Direct taxes in India are based on the iniquitous 'Tax Deduction at Source', or TDS, which mandates that tax should be deducted before any payment is made. Thus, before paying salary an employer has to deduct tax and submit it to the tax department. A bank must deduct tax at 10% if the total interest accrued on term deposits exceeds Rs 10,000 in the financial year. Anyone paying rent in excess of Rs 1,80,000 in one year has to deduct TDS as well as Service Tax at 12.5% on the rent. Since the taxes are meant to be paid by the landlord it means that the payee is acting as an agent of the government. But, while politicians and civil servants get huge salaries and perks from the taxes we pay the payee is promised punishment if he fails to carry out the dirty work of our masters. The taxpayer has to claim back excess tax paid when he files returns at the end of the financial year and if there has been any mistake then he may never get his money back. Rs 650 billion in tax refunds have been paid so far this year but many people are still waiting. If refunds are delayed the authorities must pay interest at 6% but a panel, headed by a retired high court judge, has recommended less stringent treatment of taxpayers and a higher interest rate. Imagine the amount of money the government is wasting in paying the humongous salaries of tax officers, which has been increased by another humongous addition of 23.55% by the Seventh Pay Commission, for calculating refunds of millions of taxpayers and then paying interest on their sloth. The most amusing news for us hapless taxpayers is that no one, including the government, knows how many government employees actually exist because India has a long and proud tradition of 'ghost employees', whose salary is drawn every month. In her blog the accountant suggests a passbook system where an entry will be made every time a TDS is deducted on that taxpayer. It is an excellent suggestion to reduce taxpayer harassment and save time for officials but it does not go far enough. In a countrywide drive, that the gestapo would have been proud of, 93% of adults have already been issued an Aadhar card with a unique 12 digit number based on photographs, prints of all 10 fingers and iris scans. This is apparently to target handouts to the vote bank so that taxpayers do not benefit. Why not use Aadhar numbers for targeted salaries and eliminate the ghosts? The Aadhar number should be the only bank account number for individuals and tax officers will sit in main branches of banks where they will instantly calculate what tax to be paid. The adversarial system was used by the British. We want some service from our public and civil servants. Pipe dream?

For real wealth we need to sell abroad.

India's exports fell by 14.75% in December, 2015 to $22.3 billion while imports shrank by 3.9% to $33.9 billion, giving a trade deficit of $11.7 billion. Total trade deficit for the full financial year will be around $140 billion. The good news is that Indians living abroad remitted $70 billion back home and oil prices have fallen from a high of $115 to around $30 a barrel today, reducing our import bill. The bad news is that India has agreed with the US Foreign Account Tax Compliance Act which might restrict remittances from the US and the fall in the price of oil, while good for our import bill, will certainly reduce remittances from Gulf countries, as they reduce their budget spending to account for the severe reduction in income. An article explaining the steep fall in our exports says that "....the main culprit is the exchange rate of the rupee ". From 31 December, 2014 to 31 December, 2015 the rupee has fallen by 4.2% against the dollar, almost the same as the Chinese yuan which has fallen by 4.3%. But the South Korean won has fallen by 6.6%, the Thai baht by 9.4%, the Indonesian rupiah by 10.4%, the Mexican peso by 17%,and the Turkish lira by 25.4%. Even the Euro has fallen by 13.6% against the dollar. The strength of the rupee compared to a basket of currencies is shown by 2 indices - the nominal effective exchange rate, or NEER, which has climbed from 70 to 75.6, and the real effective exchange rate, or REER, which is adjusted for inflation, has climbed from 101.3 to 115.6. Why is our government comfortable with a strong rupee when it is harming our exports? It maybe because a strong currency gives the appearance of a strong economy or it maybe a way to attract foreign portfolio investment, to pay for our current account deficit. Foreign portfolio investment brought in a total of $89.5 billion in 2014-15, of which $57.2 billion was in debt and $32.3 billion was in equities. That is nearly a quarter of our total foreign exchange reserve of $350 billion. The rupee has fallen because FPIs have sold $1.23 billion of equities since the beginning of the year. What the article misses is that a strong rupee keeps inflation under control by reducing the price of imports, especially fuel, and allows the Reserve Bank to lower interest rate. This is because our politicians have an almost religious belief that low interest rates, regardless of any other factor, will somehow magically stimulate economic growth. Trade inside the country merely circulates the same money in a merry-go-round while exports bring in new money. Because of competition goods for exports have to improve constantly while keeping prices as low as possible. This leads to innovation and technological improvements which are vital for growth. That is why the Prime Minister has launched the 'Make in India' initiative. Not much point in having bags full of rupees. We need dollars, and for that we have to sell abroad.

Do they want to fight everyone?

A report by a retired High Court judge in Britain alleges that the Russian President, Vladimir Putin probably approved of the killing of Alexander Litvinenko, using radioactive Polonium, in London in 2006. What kind of a judge gives a probable opinion? Is that what they do in British courts - fellow probably committed a crime so throw him in jail? Clearly, this is a hatchet job by a retired judge, eager to please his political masters so that he is given more sinecures in future. So, who was Litvinenko? He was a KGB agent who turned rogue and was working for the British. He was therefore guilty of treason which would be punishable with life in prison, if not hanging, depending on where you are. Ever since David Cameron became Prime Minister he has been itching to start wars. He instigated the illegal war on Libya despite Gaddafi's warning that removing him would lead to the rise of Islamic terror groups which will attack Europe. An Iraqi defector, code named 'Curveball', lied about Saddam Hussein's WMD program, which led to the Iraq war. The first Gulf War killed at least 200,000 and another 500,000 are estimated to have died due to the second one. Britain was an eager accomplice in all these killings but is curiously shy about revealing the full extent of its involvement. The US has published some of the torture inflicted by the CIA but Britain is silent about its role in widespread war crimes, torture and genocide. Not only do the US and Britain commit atrocities they also support a wide range of terrorist groups like the Al-Nusra front in Syria. Pakistan is said to be mourning the dead in the attack on Bacha Khan University a couple of days ago. Are we supposed to feel sorry for the death of Pakistani scum just a few days after 6 of our soldiers were killed in the attack on Pathankot Air Force base? Who trains, arms and funds this terrorists? Lashkar-e-Taiba and the Afghan Taliban follow orders of the ISI, which is the intelligence unit of the Pakistan army, said Hafez Saeed Khan, chief of the IS-Khorasan, contemptuously calling them 'tawaghit' which means 'evil powers'. " There are specific arrangements in those regions and the Muslims will soon hear pleasant news about the Khalifah's expansion to those lands," he said about Kashmir. Pakistan has 110-130 nuclear warheads to threaten India so that it can continue with its support of terrorist attacks on India, says a US report. So what is the US going to do about it? It is going to reward Pakistan with a nuclear deal similar to that with India. Not only do the US and Britain commit the most genocides, they are also the biggest state sponsors of terrorism. We can only pray that these nuclear weapons go towards the west.

Right direction but still a long way to go.

The National Family Health Survey 2015-16 has published its findings, which show significant improvement in maternal and child health in the 13 states surveyed so far. Antenatal care is almost 100% and a majority of women are delivering in healthcare facilities. Infant mortality has declined in all states and 60% of all children have been immunised. But the survey throws up some amazing statistics as well. While all states report a decline in fertility rates they also report a decline in the use of contraception. How is that possible? Male fertility has been declining in the west, which has been attributed mainly to the use of plastics in everyday life. Some scientists dispute the fact that sperm counts are declining but Bisphenol A in plastics is said to have estrogen effect. Estrogen is a female sex hormone and so has deleterious effect on male fertility. Since plastic utensils are cheap poor people could be using them instead of glass or steel. Indians are certainly eating better. But they are eating more fats and less protein than before which maybe causing obesity and ill health. This needs research. The other amazing statistic is the sex ratio. The normal sex ratio at birth for humans is 107 boys to 100 girls or 1000 boys per 934 girls. This is because mortality is higher among males because of a higher incidence of severe inherited diseases, like hemophilia and muscular dystrophy, so that the ratio becomes about equal in young adults. But the survey shows that there are 1062 girls per 1000 boys in Bihar, 1018 in Goa, 1033 in Tamil Nadu, 1015 in Uttarakhand and 1011 in Bengal. Only Haryana fails with a ratio of 876 girls per 1000 boys. What is happening in India? Are people aborting boys or is the widespread use of plastics resulting in a natural selection of girls? Very interesting! If the overall health of Indians has increased why are over 50% of children anemic? The survey shows that virtually every household has an improved source of drinking water and sanitation facilities have improved, though no where near desired levels. Perhaps children are suffering from worms which enter human bodies through the feet. Hence, open defecation with walking barefoot results in worm infestation. Perhaps wearing sandals have the same effect because soil comes in contact with feet. A pilot project is running in the Gajapati district of Odisha in which children are fed rice, fortified with iron powder, in their midday meals. Excellent idea. Men normally need 1 mg of iron per day while post adolescent women need 2 mg per day. However, all children in rural areas should be dewormed every 6 months. All it needs is one tablet of Albendazole 400 mg. Surveys are fine but what we need is proper research into what the numbers mean. Else it will be window dressing.

Should the government protect people from the rich?

This is election year in the US and a series of articles have focused attention on the activities of the billionaire Koch brothers. There are 4 brothers, but David and Charles are the ones that people mean when they talk about the Koch brothers. The 2 brothers are apparently worth $41 billion each through their control of Koch Industries which are in oil, chemicals, agricultural and consumer products. A new book, 'Dark Money' by Jane Meyer attempts to shed light on the 2 brothers. Their father, Fred Koch built his fortune through business deals in Nazi Germany and Stalin's Russia. The brothers were brought up by a fearsome governess who administered castor oil and enemas if they did not open their bowels every morning. Why this interest in a couple of billionaires? Because Charles Koch has an intense hatred of government, apparently because of excessive discipline as a child, and the brothers are using their wealth to support extreme right wing politicians in Congress who will pass laws to privatise social security, reduce environment laws and reduce punishment for white collar crimes, while toughening punishment for child sex offenders. They support libertarian organisations, like the Cato Institute, have campaigned against judges in different states and spent a lot of money to defeat Obama in 2012, failing miserably. They contribute heavily, but secretly, to super PACs which are allowed to criticise candidates they oppose, while supporting a candidate they support, without paying directly into the candidate's campaign. After fierce criticism from Senator Harry Reid the brothers decided to re-brand themselves and are now contributing to several charities. They have adopted 'well-being' as their theme so as to convince people that the government is the enemy and not businesses. They push their message through think-tanks, by supporting fringe societies among university students and by owning several newspapers. A similar picture emerges of the billionaire Barclay brothers of Britain who are extremely secretive about their activities and have bought newspapers to push their points of view. So are these brothers and other conservatives typical robber barons who would rob the poor to enrich themselves? Maybe, but they also run big businesses, employing lots of people and creating wealth in their respective countries. There are numerous studies and articles on the wealthy but none on socialists who do not produce anything but promise to rob the rich to distribute handouts to the poor, while enriching themselves. Socialists aim to control a nation's resources, which they distribute to reward their supporters, creating a form of crony capitalism which enrich politicians, their families and their friends. India is a prime example. Wish we had a few billionaire libertarians.

Professors profess, but who do we follow?

Any opinion by a professor at MIT, in the US, is treated as a heavenly pronouncement by our media. So when a professor says that India's corporate taxes are low, it makes headline news. " We don't talk about taxing the rich in any form, it's all about lower taxes....we are still talking about cutting corporate taxes. Our corporate taxes are not high, they are low," he said. He said that there is now a consensus on policies of "redistribution at the bottom end". Why does he say that? Because he is professor at Abdul Latif Jameel Poverty Action Lab and has written a 'highly acclaimed book Poor Economics'. Our knowledge of economics is not even an infinite fraction of the exalted professor but we feel that since he is a professor of poverty he would have little interest in seeing poverty disappear. If he really wants to reduce poverty in India he would research ways of helping the poor not to have children, which would increase wages by reducing the supply of cheap labor, improve the health of women because of fewer pregnancies, improve the health of children as parents afford better nutrition and improve education by reducing overcrowding in schools, resulting in long term reduction of poverty. In theory, redistribution sounds very seductive. If you take Rs 10,000 in taxes from a billionaire he will not even notice it but if you give Rs 10,000 to a poor man it would immediately relieve stress on him by doubling his income for a month. Trouble is that a lot of this money leaks out from the system. This is known as 'Okun's bucket' after Arthur Okun who likened redistribution to a leaky bucket. In India, where corruption is a way of life, 84% of funds leak out so that the poor are left with pennies. Even charities spend a fraction of all the donations they receive on good causes. But there is very good reason for lower tax rates. Indian startups are shifting their registered offices to Singapore, on reaching a certain size, because tax rates are low there and rules are much simpler. Even worse, Ireland has lowered its corporate tax rate to 6.25% from an already low rate of 12.5% to attract multinational giants like Google, Apple and Microsoft. Naturally, companies will shift their tax bases to where they pay the lowest taxes. What are you going to do, attack Ireland? The EU has accused Apple of evading $8 billion in taxes. Apple has paid 318 million Euros to settle a tax case in Italy. All by basing operations in Ireland. Even in the US, where MIT is based, the rich spend millions of dollars to save hundreds of millions in taxes. National wealth vanishes overseas, quite legitimately. Is there nothing the government can do? Simplify tax laws, keep them constant and do away with loopholes. It is idiotic to allow companies to show zero profits and then force them to pay a Minimum Alternate Tax. A professor at Harvard thinks that inclusion is better than redistribution. Harvard or MIT, who wins?

Biblical prophesies for today's global economy?

A partially tongue in cheek article tries to match predictions made in the Book of Revelations in the Bible which predicts that the end of the world will coincide with the appearance of the four horsemen of the apocalypse. Famous investor, George Soros sees a crisis in global markets like that in 2008 emanating from China. The Royal Bank of Scotland advises investors to sell everything as a crash maybe imminent. So, what are the 4 horsemen of a possible financial apocalypse? The one on a white horse is that of deflation. Commodity prices are dropping, led by oil. With prices dropping to below $30 a barrel, yesterday's lifting of sanctions means that Iran will soon be exporting its oil. Crude oil prices could drop to $20 a barrel or even lower. It is disaster for countries like Venezuela whose economy contracted by 7.1% and inflation is running at 141.5%. Venezuela needs a break-even price of $117 a barrel but analysts predict a price of $50 a barrel by the end of the decade. The Baltic Dry Index, which is the cost of shipping commodities, has fallen by 70%, showing that the global economy is grinding to a halt. The South African Rand has collapsed by 9%, bringing fears of a recession and a credit downgrade to junk status. The rider on the red horse signifies China which saw foreign reserves fall by a whopping $512.66 billion in 2015, almost twice India's total annual export. As China continues to devalue its currency, the yuan, analysts fear that China is exporting its deflation to the rest of the world as its products become even cheaper. Devaluation of the yuan could lead to a tit-for-tat devaluations of other currencies, as nations fight to defend their export markets. The black horse denotes currency wars. Interest rate in European countries are negative, which means that instead of receiving interest on your deposit you have to pay the bank. This is an attempt to penalise savings, so that increased spending will lead to growth, and to stop foreigners buying Euros, so that the exchange rate of the Euro against other currencies stays low. Lastly, the one on the pale horse denotes debt. Central banks and the private sector have been piling on debt because of record low interest rates. The Bank of International Settlements says the debt of the non-financial sector has increased to 265% of GDP globally. Non-financial debt of China is up by 235%, of Hong Kong by 258% and of South Korea by 228%. For India the External Commercial Borrowing of companies has increased to 9% of nominal GDP, of which 39% is hedged against a fall in the value of the rupee. No wonder that yields of emerging market bonds are rising as markets factor in a rising risk of default. If indeed there is a global recession the suffering will be exclusively felt by the poor. Starvation will lead to war, which will lead to famine, which will lead to disease and death. Not a happy new year, is it?

Yesterday's events will shape the rest of the year.

Yesterday may turn out to be the most eventful day of the year. Al Qaeda in the Islamic Maghreb claimed an attack on Splendid Hotel in Ouagadougou, capital of Burkina Faso, a landlocked country in the west of Africa bordering on Mali. In November there was an attack on Radisson Blu Hotel in Bamako in neighboring Mali, in which 22 people died. Attacks were designed to target mainly foreigners. For the first time a woman was elected President of Taiwan. Tsai Ing-wen is from the opposition Democratic Progressive Party which wants independence from China. " Our democratic system, national identity and international space must be respected. Any forms of suppression will harm the stability of cross-strait relations," she said. Sounds like a declaration of independence. In response Beijing has snarled, like it snarls at all its neighbors, that it will not deal with anyone who does not recognise that Taiwan should abandon any " hallucination " towards independence. President Benigno Aquino of Philippines has compared China to Hitler's Nazi Germany, in response to which China snarled that Aquino is " ignorant and amateurish ". China has kidnapped 5 men from a bookshop in Hong Kong which publishes books critical of the mainland and has published a book on the love life of President Xi Jinping. Hong Kong saw the Umbrella Movement in 2014, which was broken up by the police. Now the students who led the movement are facing criminal charges. China is used to kidnapping its own citizens. Anyone protesting the brutal regime in China disappears into a system of 'black jails' where abuse is common and impunity guaranteed. It is not a big surprise that China is feared and hated by its neighbors. Sanctions on Iran have been lifted following certification by the International Atomic Energy Agency that it has complied with its nuclear obligations. US Secretary of State, John Kerry cheered," Today marks the start of a safer world." If so, why did Iranian President Hassan Rouhani declare a " glorious victory " for the " patient state of Iran "? Of course, it does not matter how safe John Kerry thinks the world has become because future events will be decided in Riyadh and Tel Aviv as the conflicts in Iraq, Syria and Yemen grind on. Never thought the day would come when Mr Rahul Gandhi would be accused of talking sense but yesterday he offered assistance to pass the GST bill in 15 minutes if the government agrees to the 3 conditions laid down by the Congress. A rate of 18% will increase revenues as increased tax collections from the services sector, which comprises 52% of the economy, will make up for lesser collections from manufacturing. A fixed rate will reassure anyone wanting to invest in India that taxes and rules will not change suddenly at the whim of politicians, like the idiotic GAAR. A binding neutral dispute resolution will reduce unnecessary court cases. Eminently sensible, what? What a day!

Spend on handbags by saving on diesel.

Apparently there are 137,000 ultra high net worth households in India, which means their net worth is over Rs 250 million each. The number has jumped from 62,000 in 2010 to 137,000 in 2015, while the combined net worth has soared from Rs 45 trillion to Rs 128 trillion. Yet when it comes to paying income tax only 48,000 pay tax on an income of Rs 10 million and just 5,000 pay tax on an income of Rs 50 million. So, what are these ultra rich people doing with the money that most of us can only dream about? " The situation has started changing in India and over the last five years, brands like Michael Kors, Charles and Keith, Coach, Gucci, Louis Vuitton and even Hermes have started making their presence felt," says an article. Naturally, while ladies are buying expensive handbags men are buying cars costing upwards of Rs 3 million. Yet, they choose to buy diesel, rather than petrol, engines because the cost of diesel is lower in India, so running cost will be low. That is why the odd-even scheme in Delhi was just a gimmick. If they increase taxes on diesel to bring its value at par with petrol, like in the US, where diesel is more expensive, people will switch to petrol engines. This will bring down pollution without inconveniencing people. Seems strange that people with so much money try to save on pennies. The reason maybe that a large amount of their wealth is in real estate, which means that a lot of it is black money and, while their asset values maybe enormous, a lot of it is not disposable. The biggest problem in India is that it is not easy to become rich, because 68 years of socialism has resulted in a culture of mediocrity where merit has become a dirty word. New businesses starting up in India transfer their registered offices to Singapore, on reaching a certain size, because taxes are so high in India and rules keep changing according to the whims of politicians. Unions are gangs of thugs which prey on the vulnerable as an Americans artist found, in Kerala. You have to pay a ransom to union thugs even if they have not done any work for you. India's formal labor force is a paltry 3 million in  population of 1.25 billion, the rest are in the unorganized sector, where there is no job security, wages are low and there are no benefits. This in a country where 68,922 people are turning 25 years old everyday, which is 2.1 million every month. Even though there are so many seeking employment salaries will increase by 10.5% this year. Why? Because over 50% of graduates are unfit to be employed. The Bombay High Court is of the opinion that companies should earmark 2% of their profits to pay the medical bills of poor people. We do not know whether this is on top of the 2% of profits companies are forced to spend on social welfare under the CSR Act. When making money is so difficult it is no wonder that the rich save on diesel. It is at least 10% saving.

Will the European Union become a European Disunion?

ISIS has claimed responsibility for the Paris style attack in Jakarta in Indonesia yesterday, giving a taste of what to expect for the rest of 2016. ISIS has a research facility in which its scientists are inventing new systems to make heat seeking missiles and remote controlled car bombs. The US is in suspended animation, waiting for a new president to be sworn in next year. Till then hundreds of crucial posts in the administration will remain vacant as a hostile Congress refuses to confirm anyone nominated by Obama. The World Bank has cut growth estimate for this year from 3.3% to 2.9%. That is provided there is no major war or a natural calamity such as Fukushima. Legendary investor, George Soros is warning of a 2008 like crisis. The Royal Bank of Scotland advised investors to sell everything. There are risks everywhere, but it is Europe, which is quietly simmering away in the background, that could provide the biggest headaches. Greece could yet be thrown out of the Euro, Britain could exit the EU and increasing numbers of migrants could lead to the end of the Schengen agreement. European countries want Germany, the largest economy in Europe, to lead, but at the same time politicians do not want to be told what to do because they have domestic electorates to pander to. Germany is still suffering a guilt complex dating back to the Nazi era, which it blames on the hyperinflation in 1922-23, so is reluctant to assume leadership, while imposing austerity on highly indebted countries. It is the migrant crisis, on top of economic slowdown, that could cause real political problems in Europe. There is apparently an Arabic word for gang-rape, which is 'Taharrush', which is being heard in Europe. Over 500 women were sexually attacked in Cologne in New Year's Eve celebrations. Police in Sweden covered up sexual attacks by under-age migrants because of fear of reprisals. A girl of 17 is raped at a swimming pool in Munich and her 14-year-old sister sexually assaulted. A three-year-old boy is raped by multiple people in an asylum centre in Norway. Stories like these have led to revenge attacks on kebab shops in Leipzig, as anger grows against all immigrants. Firearm sales in Austria have increased by 350%. " Europe needs more cooperation, integration, risk-sharing and solidarity. Instead, Europeans appear to be embracing nationalism, Balkanization, divergence and disintegration," writes Prof Roubini. Exactly. Nationalism is born of politically correct fanatics. Opposite poles.

A Faustian bargain, but who pays?

After rising by 9.8% in October Industrial Production fell by 3.2% in November while retail inflation inched up to 5.61% in December from 5.41% in the previous month. Consumer durables, such as cars and electronic items, grew by 12.5% but non-durables, such as food and items of daily use, contracted by 4.7%. Apparently rural demand is down after 2 years of poor monsoons. If so, why is rural inflation higher at 6.32%, compared to an urban inflation rate of 4.73%? Mystery. Of course, figures do not tell the whole truth. Life style inflation is much higher because of soaring taxes. Politicians win elections by promising handouts and then increase taxes to pay for them. Delhi government is ecstatic at higher collections, having doubled taxes on hotels and cinemas from 20% to 40%. Why? Because they have increased salaries of MLAs by 400%. So, we pay extortion money so that they can travel abroad, attend marriage parties and buy gifts. Isn't that what the mafia does? Chief Minister of Bihar, Nitish Kumar has imposed 13.5% tax on luxury items, including samosas, kachauris, mosquito repellent and hair oil. Apart from the fact that we should have the individual freedom to eat out or use whatever cosmetics we like these items are mainly used by the poor. Why is Nitish Kumar punishing the poor? Because in his uncontrollable desire to be chief minister he made a large number of rash promises which have to be paid for. He has also boxed himself in by promising to ban the sale of alcohol, which means he loses Rs 40 billion in excise revenue. The people of Bihar suffer but goonda raj will make windfall profits from smuggling liquor. An election victory is for 5 years. By 2017 rises in salaries under Seventh Pay Commission and the restructuring of electricity boards, under the Ujwal Discom Assurance Yojana, will kick in, putting further stress on expenditure. The global economy is uncertain and no one can predict at what rate it will grow. Recent growth was fueled by $200 trillion of debt, which is unsustainable. In such a volatile situation India's growth prospects look limited and the incessant rise in taxes will strangle any prospect of growth by reducing consumer spending. What we can look forward to is more people with PhD degrees applying for jobs as peons. Politicians will continue to enjoy.

When does a nationalist become a patriot?

In a clear demonstration of arrogant shortsightedness that afflict all Americans a professor has written that the Indian Prime Minister, Modi could visit Pakistan only because he is a 'nationalist'. His predecessor, Manmohan Singh could not do the same because he would have faced criticism for being soft on the terrorist state. Not true. Manmohan Singh went all the way to Sharm-el-Sheikh in Egypt to capitulate to Pakistan just 8 months after the murderous attack on Mumbai, which was coordinated live by handlers in Pakistan. If Modi was a true nationalist he would stop all talks with Pakistan, seal the border with fencing and mines and reply every bullet with 10 of our own. It is weird that if an Indian wants to protect his people he is branded a nationalist but an American is exalted as a patriot. Ronald Reagan armed the Afghan mujahideen, which led to the Taliban, George Bush attacked Iraq, because of which thousands of civilians are still being killed, and Obama is now a celebrated comic book super-hero, known as the Drone Master, for his slaughter of thousands of civilians by the indiscriminate use of drones. Bush even passed a Patriot Act, which allows spying on US citizens, and which has been renamed The USA Freedom Act under Obama. Freedom for whom? Pakistani military officers were part of the group which attacked the Indian consulate in Mazar-e-Sharif in Afghanistan. Who is supplying arms to the Pakistan military? The US. Saudi Arabia finances terrorist groups everywhere. Who is keeping the Saudi monarchy in power? The US. The US is thus a state sponsor of terrorism. Ariel Sharon was a true nationalist so he could withdraw unilaterally from Gaza. What did the Palestinians do in response? They elected the terrorist group, Hamas which fought with the governing Fatah and has been fighting with Israel since. So confident is Pakistan about US support that it mocks India with ludicrous excuses after every terrorist outrage. If Modi is a true nationalist he should block of all entry points with landmines, so that not even a mouse can cross into India, and rendition those Americans who are supplying arms to Pakistan. That would elevate him from a nationalist to a patriot. But he won't.

If we are happy being deceived how can we improve?

The global economy which is limping along, is not going to do any better this year, thinks Joseph Stiglitz. With so many Nobel Prize winning economists around they should have foreseen and prevented the crisis in 2007-08, and be able to suggest ways of kick-starting growth. After all they have had plenty of practice. Starting with the Great Depression of 1929 there have been at least 12 boom-bust cycles in the US since 1940. Some say that we should learn from old masters, such as Hyman Minsky and John Maynard Keynes, whereas others says that the world has changed so the old theories are outdated. If economists were able to predict markets then they would be billionaires. Turns out that professors of economics and finance are poor at making money from market investments while those in maths and computers are highly successful. Economic theories cannot account for human behavior so studies on behavioral science have assumed great importance. Successful politicians have an instinctive understanding of human behavior which they exploit to grab and hang on to power. Human beings live in large societies so practice deception all the time. That maybe why they ignore all the lies that politicians tell and vote for them. Donald Trump is leading among the Republican candidates for the presidential election later this year. According to Politifact, 76% of his statements are false and 16 statements are in the ' Pants on Fire ' category, which means whoppers. Which means that his supporters do not care that he is lying to them, even though journalists are pointing out his lies. Seems that chimpanzees also tend to lie if they can get away with it, so it maybe an instinctive behavior in humans. Perhaps they are oversimplifying human behavior. In the US, the richest country in the world, people worry about security and about maintaining US superiority over the rest of the world. In poor countries like India people want handouts, such as food and money. Thus, Donald Trump says he can make America great again because he is a billionaire whereas Rahul Gandhi, although also a billionaire, wants to stop any reforms because he can win elections by promising handouts. Financial investors look for short term gains, ignoring virtuous behavior while rewarding villains. Since human behavior is going to remain unpredictable the global economy will limp along. The rich will remain rich, the rest of us will scrape along.

Every silver lining has a dark cloud behind it.

Brazil, Russia, China and India were lumped together into BRIC in 2001, before South Africa joined in 2010 to make it BRICS. Now some think that India should distance itself from this group. We know that China's economy is slowing down, although why a growth rate of 7% is considered slow is a mystery. Xi Jinping has decided that the rate of growth should not fall below 6.5% through 2020 so the government will try and stimulate the economy. The stock market fell steeply last week and is falling again this morning. Russia is in recession due to sanctions and there is little prospect of improvement in the near future. Russia is heavily dependent on oil exports and the price of crude is unlikely to rise any time soon. If the conflict in the middle east becomes worse the price of crude may increase but if the price goes up shale oil production will become profitable once more, so supplies will increase. If sanctions on Iran are lifted more oil will come to the market and the price will stay down. Saudi Arabia, not a member of BRICS, is having to restructure its economy by reducing expenditure and generous subsidies for its people. The South African economy is in such deep trouble that comparisons are being made with neighboring Zimbabwe. President Jacob Zuma has changed Finance Minister 3 times in recent weeks. Brazil's economy is in crisis. The Supreme Court has impeded opposition attempts to impeach President Dilma Rousseff for now. Its economy is shrinking, inflation is in double digits, the trade gap is dangerously high and its debt has junk rating. So what of India, the 'i' in BRICS? The Congress multiplied entitlement programs to win votes, leading to double digit inflation, high fiscal and current account deficits and a steep fall in growth rates. The fall in the price of oil has been a boon for the economy but the steel industry is suffering from a double whammy of falling iron ore prices and a weaker Chinese currency, making Chinese steel cheaper to import. However, retail inflation is still relatively high at 5.41% , so the RBI cannot lower the price of rupee by much because it will make imports more expensive and worsen inflation. " As 2016 begins there are clear signs of of serious debt/default squalls on the horizon," writes Carmen Reinhart. " From a historical perspective, the emerging economies are headed toward a major crisis." God help us.

A round face with a prominent moustache is very suspect.

Delhi has deteriorated rapidly under the rough despotic Chief Minister, in the past one year that he has been in power. Roads have not been repaired, piles of garbage everywhere and electricity outages have become common, lasting 7 hours in South Delhi on the 8 January. Instead of working hard to improve our lives he abuses everyone from Prime Minister to civil servants in the most uncouth language. Civil servants went on strike against his thuggish behavior, to which he wanted to " replace bureaucrats with professionals and sector experts ". Indeedy doody. Thing is, Kejriwal qualified as a mechanical engineer from IIT, Kharagpur, which is a premier institute in India. That makes him a professional. Yet he absconded from his post as Assistant Commissioner of Income Tax to start a NGO. We confess that we are extremely cynical about NGOs, of which there are more than 3 million in India. As the Delhi High Court observed," 99% of the existing NGOs are fraud and simply moneymaking devices." Why are we suffering from power outages, lasting for hours? Because Kejriwal is protecting people who have not paid their bills. This is one of the bribes, like free water, with taxpayer money that he used to win his election. The car rationing scheme imposed on us by diktat is an assault on our freedom and our lives. Studies show that most pollution comes from burning of stubble by farmers, coal fired power plants and burning of wood by poorer people. Pollution from vehicles is not more than 25%, of which cars will be a small proportion. Although 2.8 million cars are registered in Delhi the actual number is much less because a car's registration is not cancelled when it is trashed. That does not stop Kejriwal from assaulting the citizens of Delhi with this punishing scheme. He has employed a top lawyer to defend the scheme in front of the Delhi High Court, when the data shows that pollution levels have been no better than other years. This, despite unusually mild weather with virtually no fog to trap pollution in the air. Is the lawyer indulging in blatant perjury in front of the judges? Top lawyers charge humongous amounts to represent, so we, the taxpayers are paying for lies about a scheme that punishes us. A man with a round face and a prominent moustache is suspect as pictures of El Chapo, just arrested in Mexico and Dawood Ibrahim clearly demonstrate. Who is the psychopath then?