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?

Why so much love without gain. Must be religion?

Indian Prime Minister, Narendra Modi paid a surprise visit to Pakistan just last month. Hardly had his feet touched Indian ground than the Pakistanis sent in terrorists to attack an air force base in Pathankot. Modi promised a doctrine of bullet for bullet against Pakistan when he was elected in May 2014 and that is what India practiced at first. He called off all talks until Pakistan stopped behaving like mad dogs. And then Obama visited India in January last year for Republic Day celebrations. What the scum, Obama told Modi we do not know but since then India has been kowtowing to Pakistan, as we have been doing for 68 years, since independence. In fact, even as he accepted Modi's invitation the scum, Obama phoned Nawaz Sharif of Pakistan to ask for permission and ask for instructions on what to say. Why is the US a slave of Pakistan? US exports to Pakistan is almost nothing at $1.67 billion while imports are $3.4 billion whereas the US exported $20 billion worth to India and imported $41.7 billion, last year. Despite having no trade with Pakistan the US has been pouring civilian and military aid into that terrorist state. Pakistan has used arms supplied by the US to attack India repeatedly. The ISI in Pakistan was funding the Taliban to kill Nato troops in Afghanistan, using US supplied weapons. Contrary to what the US says Pakistan has no geopolitical importance at all. The Arabian Sea is to the south of Pakistan, India has a coastline of 7,517 km. To the west of Pakistan is Iran with which the US has concluded a nuclear deal. After having been soundly thrashed in Vietnam, Iraq and Afghanistan the US is does not have the guts of taking on Iran, even if it constructs a nuclear weapon, so nothing there. To the northwest is Afghanistan, from where it has just fled with its tail between its legs. To the north Tajikistan has a short border with Pakistan occupied Kashmir and to the northeast is China. The US has little interest in Tajikistan but if it really want to contain China it should be engaging with India which has a large land border with the cockroach-eaters. China is building an economic corridor to the port city of Gwadar. No trade, no political or military importance and an exporter of terrorists. Why so tolerant of this terrorist state? Hindus are heathens to Christian US and Kafirs to Muslim Pakistan. Hence the extreme friendship.

Tears for the US, but what about the world?

President Barack Obama broke down into tears while talking about gun violence in the US, 3 days back. He has promised executive action to make background checks mandatory on everyone wanting to buy a gun. Donald Trump believes that Obama's tears were genuine but we are not so sure. " In this room right here there's a lot of heartache," he said, in front of relatives of victims of mass shootings, in the White House East Room." There's a lot of resilience, there's a lot of strength, but there's a lot of pain." Quite, but why now? Why has he waited so long when he could have passed the same orders in 2012, right after the shooting at Sandy Hook Elementary School at Newtown? At that time he said," If there is one step we can take to save another child, or another parent, or another town, from grief that has visited Tucson, and Arizona, and Oak Creek, and Newtown and communities from Columbia to Blacksberg before that - then surely we have an obligation to try." We know the gasbag can talk but why wait till the last year in office, when you are not only lame, but a dead duck, before passing orders that will be challenged in court and overturned in Congress? He has been extremely lucky because Virginia Tech happened in 2007, before his first election in 2008, and Newtown happened in December 2012, after he had won his second term. But for us outside the US Obama's tears seem immensely hypocritical. After all, he has the record of being the most prolific serial killer in human history, using drones to kill innocent civilians from Pakistan, to Yemen, via Iraq and Syria, on to Somalia and Libya. So either he thinks that killing non-Americans is fine, which makes him a vile racist, or he is acting for his domestic audience, which makes him a most cynical drama queen. While Obama is shedding tears, just before the Oscars are announced, North Korea announced explosion of a hydrogen bomb, although experts are sceptical about the claim. North Korea is a brutal impoverished state supported by China, a brutal wealthy state. China has landed planes on artificial reefs in the South China Sea, in a clear provocation to its neighbors. ISIS has established a 'jihadi university' in Raqqa, in Syria where they may have mastered technology to make thermal batteries for heat seeking missiles with which they can bring down airplanes. We had a Jihadi John, now we have Jihadi Sid, so maybe we can look forward to a Jihadi Bond in the near future. First Saudi Arabia chopped off the head of Nimr al-Nimr, a Shia cleric, then protesters firebombed the Saudi Embassy in Tehran and now Iran is accusing Saudi Arabia of bombing the Iranian Embassy in Yemen, in revenge. We will be rid of Obama this time next year but the world will be suffering his effects for decades to come.

Are we going to import economic virus from China?

After we hoped for a crisis in China yesterday there is some cheering news today. The Chinese stock markets opened and closed for the entire day in less than an hour this morning when circuit breakers were activated by a 7% fall in market values. The Shanghai Composite fell by 7.32% while the Shenzhen Composite fell by 8.35%. Markets were spooked by a fall in the value of the yuan by 0.6% against the dollar. But that is not the whole story. The Peoples Bank of China has been fixing the yuan at lower rates everyday because it has devalued by 7.5% in offshore markets. China is our biggest enemy, regularly protecting Pakistani terrorist groups at the UN Security Council, so everything bad that happens to this nation of cockroach-eaters is good news for us, right? Unfortunately, as the yuan becomes weaker other currencies become stronger against it which makes exports of other countries more expensive than those of China. There is a danger of central banks in other Asian countries devaluing their currencies to preserve competitive advantage in the export market. That would be very bad news for India. Our exports have been falling for over a year and a strong rupee will not help. So why not devalue the rupee in line with other currencies? Because we pay for our imports, especially oil and gold, with dollars and a weaker rupee will push up costs for customers adding to retail inflation, which at 5.41% is higher than in other countries. The Purchasing Managers Index shows a contraction in manufacturing. Banks are sitting on $60 billion dollars of defaults on their loans and cannot lend unless they can clear up their books. Companies are loaded with debt. One-fifth of non-government, non-financial companies are said to be leveraged, which means their debt is twice that of market capitalisation and 15% of these companies are said to be highly leveraged. All these companies have net worth is less than zero. Higher profits would allow them to pay off the banks, which in turn, will have more cash to lend for new businesses. But profits can only grow if people buy more goods. There is a huge difference in spending pattern between the top 10% and the bottom 10%. While the bottom 10% spends 63% of income on necessities, such as food, the top 10% spends just 33% on necessities. The middle class has been hit hard by a combination of rising prices and ever increasing taxes, apparently to fund social schemes. Sly increases are called cess, which have been diverted for other expenses. Taxes are a straitjacket around the economy which has seen a fall in growth of the nominal GDP. That means lower tax collections. Some are suggesting that government spending should rise to compensate for private sector weakness. That would increase government borrowing and interest rate. A rock and a very hard place, what?

Can you have a free market, with Chinese characteristics?

As stock markets opened on Monday for the first time in 2016 the Shanghai composite index plunged, leading to a circuit breaker coming into effect. It was down 6.9% at the close, while the Shenzhen composite ended 8.2% down, bringing markets down in the rest of the world. The fear is that if the Chinese economy slows all the countries that sell commodities, like Brazil and Australia, will suffer. However, most analysts are optimistic that China's economy will continue to grow, although not in double digits, and manufacturing will pick up in the latter part of the year. China's manufacturing Purchasing Managers Index came in at 48.2 in December, contracting for the tenth month, although the official index was 49.7. Anything below 50 shows contraction. The official services PMI grew to 54.4 in December, from 53.6 in November. The Chinese say that this is because the government is restructuring the economy away from investment towards consumption as the country becomes more wealthy. So, we can all relax? Not so, say some economists who think that growth in China will be much slower leading to the global economy shrinking by 5% this year. If everything was as the government planned it would not trying to stimulate sections of the economy to increase the rate of growth. This will lead to asset price bubbles in those sectors. Countries which sell commodities to China are also big buyers of Chinese made goods so, if their economies become weaker they will buy less from China. The other way to stimulate manufacturing is by making its currency, the renminbi or the yuan, weaker. China devalued the yuan by 2% in August which was said to be an adjustment to bring it into line with the market. This is because China desperately wants the yuan to be part of the IMF's Special Drawing Rights, which are constituted by the dollar, the euro, pound sterling and the Japanese yen at present. This will give it prestige and will prevent fluctuations in its value, as countries make it part of their foreign currency reserves. However, when China devalued the yuan there was a sharp outflow of capital as investors became worried about further devaluations so the Peoples Bank resorted to selling US treasuries to support the yuan. Therein lies the problem. The IMF has approved the yuan becoming part of its SDRs but the government has to stop interfering in the market, which it seems unable to do. If the yuan falls too much other countries will also devalue their currencies to counter the advantage. This is what worries our Reserve Bank governor, Raghuram Rajan. To stop capital flight China has started to fine banks for aggressive currency trading so that some banks are refusing such trades. Once you become used to the stick it is very difficult to put it away. We pray that the stick will soon break and China will break apart. Happy thought.

Force will not help, information will.

One, Manu Joseph writes a passionate plea for Facebook to be allowed to offer internet.org into India. " Facebook has created a platform called Free Basics that can give free access to a fraction of the Internet to anyone who has even a cheap feature phone," he writes. He is incensed by activists who are campaigning against this service, because it violates the principle of net neutrality. It would be a great service for the poor because they will get it free and " Facebook does not charge any application to be on Free Basics, nor does it pay the service provider for providing the free service ". Quite. But Facebook has no control of over service providers and we know that business fellows in India will do anything for short term profits. " If India's poor were denied their kerosene and food subsidies, and cheap railway tickets and electricity, they would hit the streets and bring the nation to a halt," he fumes. Yes, they would. Because decades of socialism has bred a culture of beggary and entitlement, in which people think they have a right on the state, but without any obligation to serve the nation in any way. Because it is free there are still 20 million without any electricity, because the boards are bankrupt. The electricity discoms have accumulated losses of over Rs 3.5 trillion and owe Rs 5.5 trillion to the banks. There are over 1 billion mobile phone connections with zero unpaid bills. Even the poorest people are buying smart phones and pay their phone bills on time because they enjoy staying connected. Till 1990 we had only the state owned Doordarshan, broadcasting extremely boring programs but once it was deregulated we have an explosion of private Indian and foreign channels. Poor people will live without a refrigerator but not one will dream of living without a color television and a cable connection. If net neutrality is so bad why is it enforced in the US, Mr Zuckerberg's home country? Mr Joseph is a good chap but the problem is that poor people are not content with bread alone, they want meat and fish as well. Those who speak on behalf of the poor believe that they know what is good for them, which is treating the poor as imbeciles, and want the rich to be made poor, through higher taxes and poor services. So, road rationing in Delhi is good because even a little bit helps, even though cars cause a fraction of the pollution, and some other countries have tried it, never mind that it has failed everywhere. Any kind of oppressive diktats imposed by tyrannical politicians is bad, whether in banning beef or dance bars in Mumbai. Rich people will always find ways to help their children stay ahead. Because they have access to greater information. If the poor are to catch up they need a uncontrolled internet.

The start of the entertainment?

Just when we thought that ISIS was coming under control, after losing Ramadi to the Iraqi army, things have hotted up nicely in the middle-east again. Couple of days back Saudi Arabia executed 47 on terrorist charges, of whom 43 were Sunnis, who are the majority in the country. Trouble was that 4 were Shiites, including a cleric, named Nimr al-Nimr. Shiites have been protesting across the region, including in Saudi Arabia, where they are a minority and normally try to stay hidden. The Saudi embassy in Tehran was firebombed. In response, the Saudi government has severed diplomatic relations with Iran and asked the ambassador to leave within 48 hours. " Iran executes far more people a year than Saudi Arabia, but it does not get the negative publicity Saudi Arabia has. This is something that must be addressed," said a Saudi political commentator. Quite. Just stop chopping people's heads in public, as a kind of entertainment. Iran released a picture comparing Saudi Arabia with ISIS in which the Saudi executioner is in white and the ISIS is in traditional black. The Supreme Leader of Iran, Ayatollah Khamenei has promised 'divine revenge'. Meanwhile, Israeli commandos are rescuing Syrian rebel fighters, sworn enemies of Israel, who have been wounded in battle. They are left by their comrades at the fence separating Israel from Syria, picked up by the Israelis and treated by them in the hope of sending them back to fight Bashar al-Assad. But Assad's forces are fighting ISIS, with support from the Russians and help from Iran and Hezbollah from Lebanon. So, will these actions by the Saudis and the Israelis end up helping ISIS which is being targeted by big brother, the US, which supports both countries? On the other hand, Russia has recently eliminated leaders of several other rebel groups fighting Assad, so are Russian actions helping ISIS? Turkey's President Erdogan is helping the US to bomb ISIS but is also helping them by bombing Kurdish PKK forces. Turkish fighter planes shot down a Russian SU-24 returning from a bombing mission, apparently for straying into Turkish air space for 17 seconds. Russia is sure that this was in revenge for bombing ISIS oil trucks which were being bought by Erdogan's son. Turkish fans booed during one minute silence for the victims of the Paris attacks, before a friendly football match with Greece. Meanwhile, a ceasefire has broken down in Yemen, to the south of Saudi Arabia, where a coalition of Arab countries, including Saudi, has been bombing Houthi rebels, who are Shia. Across the Red Sea, in North Africa terrorists are busy practicing their craft. We have written many times that Israel and Saudi Arabia will join together to attack Iran's nuclear facilities. Maybe, it will be more exciting than that. We wait to be entertained.

Will the Commissar win in Delhi?

Since the first of January rationing of cars, with odd and even number plates allowed on the streets on alternate days, has been imposed by force on the citizens of Delhi. It was very successful on the first day, presumably because many offices were closed on New Year Day and because few would like to pay an extortionate fine of Rs 2,000. Delhi Chief Minister was ecstatic at being able to cause such misery to people and because auto-rickshaw drivers are making windfall profits by overcharging commuters. So happy was he that he quoted a John Lennon song," You may say I'm a dreamer, but I'm not the only one. I hope someday you'll join us." Wrong, on all counts. You are not dreaming of enhancing the quality of life for the people of Delhi, but of becoming the prime minister of India someday, which, God willing, will never be fulfilled. The scheme has been successful so far because of heavy policing, the threat of heavy fines and because it is only for 15 days. If you try to make it permanent to help your auto-rickshaw vote-bank we will just buy second-hand cars. which will pollute more, to beat the system. That will lead to humongous parking problems with people being killed over parking spots. If parking is made expensive, by heavily taxing extra cars, people will buy cars in other states or even in names of relatives who live outside Delhi. Car rationing has not worked elsewhere because people will do whatever it takes to get to work. For survival. It worked in Beijing during summer Olympics in 2008 because factories were also shut down during the period. On 2 January there was greater confusion and one may expect massive traffic jams at borders with neighboring states, from 4 January, which will be the first full working day since this oppression started, when people block traffic to argue with police. When Soviet Union banned decadent western Jazz and rock'n'roll people pressed music on used old X-ray plates, to beat the system, although you could end up in Lubyanka for doing so. Perhaps our very own Commissar would like to try the same with us. At least 2 studies, one from IIT Delhi and the other from the US, showed that wood smoke and emission from power stations were the biggest polluters. IIT-Kanpur found more pollution from trucks and two-wheelers. Add to that dust from construction and burning of stubble by farmers in Punjab, pollution from cars is a tiny fraction. So far luck has favored the Commissar because the weather has been mild, with no fog. Hopefully, it will become really chilly, when people will burn wood and waste for warmth, and fog will trap pollution near the ground revealing the Commissar's lies. If that happens he will no doubt blame the Prime Minister in uncouth language. The fault lies with the greedy people of Delhi for voting this fascist into power, in the hope of getting cheap water. However, Delhi people are world experts at breaking the law. Let us see who wins. Very droll.

Monetary integration with political separation, surely impossible?

" The current non-system is pushing the world towards competitive monetary easing, to no one's ultimate benefit. Developing a consensus for free trade and responsible global citizenship - and thus resisting parochial pressures - would set the stage for the sustainable growth the world desperately needs," writes Reserve Bank Governor, Raghuram Rajan. He is concerned about a low rate of global economic growth, which is reducing demand and the need for new investments. Rich countries need higher growth rate to fund social security costs of aging populations and for wages to rise, to reduce rising inequality. They could spend on infrastructure but that would increase savings due to increasing anxiety about tax increases. " That means overcoming deficit fetishism. It makes sense for countries like the US and Germany that can borrow at negative long-term interest rates to borrow to make the investments that are needed," writes Professor Joseph Stiglitz. Unfortunately he realises," The obstacles the global economy faces are not rooted in economics, but in politics and ideology." Exactly. As the then Prime Minister of Luxembourg, Jean-Claude Juncker said," We all know what to do; we just don't know how to get re-elected after we have done it." But maybe they do not know what to do. Economists are beginning to understand that the world has changed and what they learnt may not solve today's problems. Human beings do not behave according to mathematical models. Not only will individuals try to find ways to game the system, as the wealthy do when they spend millions of dollars to find loopholes in tax laws to save billions of dollars in taxes, but millions of people will behave in irrational manner, as when Delhi voted overwhelmingly for Kejriwal because he promised 20,000 liters of water free every month. Economists believe that they have to find new models which will incorporate the changes in society. But, surely that is impossible? We do not have a global parliament elected by all the peoples of the world. Politicians are elected by their own people and are expected to serve their interests, even if they are harmful to other countries. Colonialism was a perfect, if extreme, example of that, in which European countries enslaved other nations and plundered their resources to grow very wealthy. Although very similar in culture and religion the European Union is being pulled apart under the twin stresses of economic recession and refugee migration. The US has just negotiated the Trans Pacific Partnership with 11 countries which will tie them in strict trading rules. The US is pursuing a similar trade deal with Europe, called the TTIP. Closer integration of trade with complete separation of political systems, which means each country adopting its monetary policy to take advantage of the system. That is what is frustrating Raghuram Rajan.

Will there be a Happy New Year for children?

As 2016 starts, Nobel Peace Prize winner, Kailash Satyarthi writes a heartfelt plea about protecting our children. New amendments to the Child Labor Act will allow children below the age of 14 years to help their families in 'non-hazardous' family businesses or in the entertainment industry. He gives examples of 3 children, between the ages of 8 and 10 years, being treated like slaves by their uncles. 'Uncle' is a generic term in India. It is possible that the children were sold by their parents to fill their own stomachs. In Bangalore 3 girls were sold to 2 men who assaulted them sexually. They ran away once, only to be resold by their parents to the same 2 men. In Tamil Nadu 3 girls, even younger in age, were sold by their parents to 2 families who employed them as household servants and tortured them. Child labor is abhorrent and must be eliminated. But how? When adults have the right to produce as many children as they want and parents have total control over their children. In 2012 there was a huge controversy when Norwegian Child Protection Service removed 2 Indian children from the care of their parents. Foreigners have accused the Norwegians of using child protection as an excuse to abduct children from their natural parents and hand them over to Norwegians who do not have children. No politician in India would ever dream of protecting children. The reason is simple: Children do not have the right to vote. So to show their hypocritical concern they passed the Right to Education Act which forces private schools to reserve 25% of their seats for children from slums. Very noble. Except that the reason that middle class children do well in studies is that with educated parents they get a lot of help at home, which will show in exam results. So, to stop widespread failure of poor students all exams up to Class 10 were made optional and no student could be detained. Which meant that there was no way of knowing whether children were learning anything in school, so teachers stopped teaching. Only 48% of Class 5 students can read Class 2 texts and only 44% of Class 8 students could do divisions. Government school teachers are incompetent so the crafty politicians thought that RTE was a cheap way of getting votes. Now 18 states are going to revoke the policy of no detention of students for failing in exams. Uttarakhand, a Congress ruled state, says that it cannot afford the cost of RTE. With such enormous right to education is it any wonder that there are 75,000 beggars, that is 21% of the total, who have passed Class 12. What can they do when 2.3 million applied for jobs as peons in UP, around 25,000 with post graduate degrees. Unless you are in politics when you become deputy chief minister. Instead of giving phony rights children should be given the real right: The right not to be born. Will anyone listen?

Wisdom does not come from knowledge.

As 2015 comes to an end we can look forward to the last year of Barack Obama as the President of the US. In November next year the US will elect a new president and on 20 January 2017 we will hopefully see the last of the gasbag. After George Bush, who has been ridiculed as a moron, Obama was thought to be a cerebral president, an alumnus of Harvard Law School, no less, but he leaves the world an infinitely more dangerous place than when he first came to power. Much like Dr Manmohan Singh was built up as a great economist, only to reduce our economy to near bankruptcy in his determination to cling on to his chair, whatever the cost to the nation. Obama probably thinks that he is so smart that the rest of the world should do as they are told. What he has not understood is that the US may be the richest and the strongest nation in the world but it is just another country on Mother Earth. The Climate talks in Paris earlier this month ended with a wishy-washy deal because the US insisted on the same levels of sacrifice from emerging nations. Obama had already signed a deal with China, which allows China to peak its CO2 emission levels by 2030 and the US would try to reduce CO2 below 2005 levels. If numbers one and two are not going to reduce their emissions why would anyone else? Mother Earth has just reminded Obama that she is the boss. Floods are affecting several states and 69 tornadoes have hit the US in December. 49 people have died and damage will be in billions of dollars. There are floods where Brazil, Argentina, Paraguay and Uruguay meet in South America while Storm Frank is causing more misery in Britain which was already inundated from previous rains. The Arctic temperature is going to rise to above freezing when it should be -20 Celsius at this time of the year. Apparently the El Nino is going to be as bad as in 1997-98, which was the worst on record. Having engineered an armed coup in Ukraine against an elected president, Victor Yanukovych, the country is now at the point of anarchy as rivals fight for power while the eastern half of the country gradually breaks away. Strangely, former President of Georgia, Mikheil Saakashvili, a US stooge, is the governor of Odessa. While Iraq was Bush's stupidity, Libya is Obama's. It is astonishing that a 'cerebral' man did not learn from the chaos produced by removing Saddam Hussein. His nuclear deal with Iran is seen as a triumph but what was he hiding? You get a bad smell when you learn that the NSA was spying on Israel's Prime Minister, including on his conversations with members of the US Congress. Having dismissed ISIS as 'JV team' he has started bombing ISIS in Syria which, of course, allowed Al Qaeda to re-establish bases in Afghanistan. He can be proud of his record of killing hundreds of civilians by using drones indiscriminately. Is it better to be a serial killer than a moron? That is surely a cerebral debate.

Without experience Nehru did a lot better than the present lot.

Couple of days ago, the Congress, theoretically India's largest party, became 131 years old, having been founded in 1885. However, the Congress is not the party it was. It was trounced in the Lok Sabha elections last year, which saw its share of seats cut from 206 in 2009 to a paltry 44, and was denied official leader of the opposition status. It is in power in only 8 states out of 29 and in 2 others, namely Bihar and Kerala, it is part of the ruling coalition. Perhaps, to illustrate the sickness inside the party an article, criticising Nehru and Sonia Gandhi, appeared in Congress Darshan, which is a Congress mouthpiece published from Mumbai. The article, written anonymously, mentions details of Sonia Gandhi's life and that her father was a fascist, which he was. It claims that Jawaharlal Nehru made a mess of foreign policy by not listening to Sardar Vallabhbhai Patel, who was Home Minister at the time. We would add other charges such as, not using air power against China in 1962, accepting China's claim over Tibet, probably refusing a seat at the UN Security Council, following a communist model of command economy, which has made India one of the most corrupt countries in the world and not making education free and compulsory, like in the west. The most confusing is the complete capitulation to Pakistan since independence. Every time our brave soldiers have sacrificed their lives to win against Pakistan our politicians have signed away all the gains without anything in return. If Lal Bahadur Shastri's death was not natural who signed the treaty with Pakistan in Tashkent? These are not fantasies or conspiracy theories but questions of enormous importance for national security. Did Nehru sign a deal with Britain to let Pakistan do what it wants in return for becoming the Prime Minister? Did Gandhi know or, even suggest, such perfidy? Whatever Nehru did we must remember that no one in India had any idea of governance after 600 years of depredation under Mogul and British conquerors. Most countries could not make a successful transition to democracy after independence from colonial rule. Pakistan is a failed state under army rule and the first President of Bangladesh, Sheikh Mujibur Rahman was gunned down, along with his family. That has to be the greatest achievement of Nehru: That he kept the army under civilian control, that he stood for elections every 5 years and that he established centers of excellence, such as the IITs and AIIMS. Compared to that the present Congress is clinging on to The Family for some reflected glory, which has dimmed considerably. " The party is so huge that it needs to have some ideology which is not present - instead the focus is on just one family," said a professor. Exactly. A party which claims to be liberal, secular and socialist, which means everything to everyone, without any reason for existence except to grab power by any means possible. The great socialist, Rahul Gandhi has just gone to Europe for a holiday. He tweeted us a Happy New Year. How twit!

Is it wrong to have principles or ideals?

As 2015 comes to an end there are hundreds of articles by pundits and 'intellectuals', giving a synopsis of events in the year gone by and their interpretation thereof. While liberals write voluminous articles on every subject we can think of conservatives write very little. This is as true in the US as it is in India. The New York Times is known to be leftist, as a cartoon by the Republican Senator, Ted Cruz so aptly illustrates, and an article in the paper lists a number of cracks that appeared in liberalism in 2015. The biggest problems were in Europe. Greece and Spain voted for left wing parties while many in France voted for the far right National Front. In Britain the Scottish Nationalists won big in Scotland and there is a danger of Britain leaving the EU. Angela Merkel's decision to admit 1 million Muslim migrants into Germany has provoked a furious backlash. In the US, Donald Trump leads the Republican race, making outrageous statements, while Black Lives Matter shut down a shopping mall and an airport terminal over shooting of black men by police in the US. The article ends optimistically saying," It is wise to bet on the current order, in other words, and against its enemies and rivals and would-be saboteurs." Is it? Liberals are so arrogant in their moral superiority, so offensive in their criticism of anyone they brand as 'conservative' and so intolerant of any view that does not echo their own egotistical interpretations, that they are as fanatical as ISIS. An Indian who prides himself on his liberalism writes that the difference between liberal and conservative is between " open minded versus close minded ". " To my mind, the liberal is defined by a lack of ideology," he writes. That is precisely the problem. The liberal has no principle, no ideal and no truth to hold on to. He is prepared to compromise with anyone or any lie to prove his lack of ideology. When Neville Chamberlain signed a peace deal with Hitler he was told," Your name will go down in history as a statesman who saved civilisation from destruction." Dozens of students at Yale, an Ivy League University in the US, signed a petition to revoke the First Amendment of the Constitution, which guarantees freedom of speech, because they are against criticism of other views. In Finland, there were riots in a normally peaceful town of Kempele when a 14 year old girl was raped by an Afghan migrant. Sharia courts in Britain are forcing women to stay locked in violent marriages, a study showed, prompting a furious columnist to question why feminists do not object to these courts. It is the liberals' tendency to excuse terrorists as a tiny minority, extremely perverted rapists as juvenile and to mock any dissent as loonies, deluded by a false feeling of 'victimhood', that will be the death of liberalism. There will definitely be a series of extremely violent wars in the world. Liberals will be responsible.

Invent anything and we will use it for fighting.

From a list of " 100 Events That Changed The World " in the National Geographic, 14 events have been selected which show how man has used every invention for the purpose of killing. Man learnt the controlled use of fire 1.4 million years ago, which immediately gave us a defence against wild animals and allowed us to keep warm, cook food and create light after sunset. Fire would be used later to mould metal into arms. If there is one invention that civilisation rests on it must be that of the wheel in 3,500 BCE. Transport, pottery and pulleys all depend on wheels, but by 2,000 BCE Hittities were using chariots for war. They also started using iron by 1,400 BCE, which quickly led to weapons and armor made of iron. In 1569 CE new maps of the world with variably spaced latitude lines would make navigation at sea much easier. This would lead to the colonisation of Asia, Africa, Australia and the Americas by white Europeans, resulting in widespread genocide, slavery and plunder of resources, whose effects are being felt till today. The industrial revolution, which started in 1712, would allow Europeans to subjugate peoples of the world but also resulted in wars between themselves, as each nation tried to gain dominance, resulting in the two World Wars. In 1876 Graham Bell invented the telephone which revolutionised communications and could be used to send signals in code. In 1903 the first manned flight would take warfare to the skies and would lead to the theory of 'shock and awe', a bombing of such ferocity that any population would be devastated . The power of the atom was used by the US on Hiroshima and Nagasaki, probably as trial and also for revenge for the bombing of Pearl Harbor. Today 9 countries have nuclear weapons, with Iran on the threshold of making one. Terrorists in Libya took control of 11 commercial jetliners last year and ISIS has got hold of a flight simulator to train some of its fighters to fly airplanes. ISIS is looking to buy nuclear weapons. Load a nuke into a commercial plane, fly low over the sea onto a city in Europe and explode the bomb in a suicide mission. Not hard to imagine, is it? The latest Star Wars movie has already raked in over $1 billion and as the name says, it is not about love among the stars but about killing, although they have tried to put an intellectual gloss on the fighting by feeling 'The Force' and the use of the lightsaber. The ISIS has been adept at using the internet as a recruiting tool by showing extreme violence interspersed with pictures of celebrating Eid, farming and fishing. Now scientists are  close to finding ways to regenerate limbs lost in battle. We can look forward to armies of invincible cyborgs taking over the world, coolly replacing a damaged part with another. No wonder man has used even God for fighting.

We need money to grow, but from where?

The Finance Ministry has lowered its growth forecast for the current financial year to 7-7.5% from an earlier prediction of 8.1-8.5%. Politicians quibble about minor differences in the rate of growth of the economy presumably to impress financial institutions, such as the IMF and World Bank, and credit agencies so that they write good things about us, which will encourage foreign investors to invest precious dollars, euros or yens in India. For us living in India such figures have no meaning. Our feel-good depends on our quality of life, on prices of what we buy, on availability of jobs, a smooth delivery of essential services and relief from the tyranny of government thugs. There is some progress but it is slow because the Congress left behind a moribund economy and has blocked all progress in parliament so far. Even at 7% India will be the fastest growing economy in the world with China second at 6.8%, the US at 2.6% and the Euro area growing by 1.5%, while Brazil contracted by 2.5%. For growth to continue millions of jobs have to be created which can only come from new investments. And therein lies the problem. Public sector investment is limited by the need to contain fiscal deficit while the private sector is completely frozen. The reason is that companies borrowed merrily during Congress regime because the Reserve Bank was bullied into holding interest rate at unreasonably low levels, in the face of soaring inflation, and they were given the impression that they would not have to repay their loans. The Reserve Bank has taken a tough stance against public sector banks on restructuring loans, which was a way of keeping bad loans off their books. The rot in the banking system is gradually coming to light and the figures are terrifying, at over Rs 6 trillion. Banks are reluctant to lend until their previous loans are repaid and taking over assets of leveraged companies will not clear outstanding loans because there is no market for stressed assets. Thus, the quality of loans is getting worse. Private sector debt has reached 52% of GDP and External Commercial Borrowing, which is loans in foreign currencies, has increased by 9% of nominal GDP. Only 39% of such loans have been hedged against a fall in the value of the rupee, which is expected to fall to around 70 against the dollar as interest rates rise in the US. That will make it more difficult for companies to service their debt. So, why not increase government spending to kick-start the economy and allow the fiscal deficit to remain at 3.9%? Trouble is that India has one of the highest fiscal deficits in the world, at 7.2%, if central and state government spending are added. Consumer inflation is also high at 5.4% while that in China is at 1.5%, in the US at 0.5% and in the EU area at 0.1%. Why? Because real estate prices increased at 13.7%. Property prices have to come down. But how?

Are we ordinary because we expect too much?

All politicians are liars, some more than others. Candidate for president in the US, Donald Trump has been deemed Liar of the Year by Politifact for 2015. Out of 77 statements made by Trump this year 16 were in 'Pants on Fire' category, which means absolute whoppers, and 77% were deemed to be lies. And yet he leads the Republican pack with 39% approval ratings, with Ted Cruz a distant second on 18%. So, why do his supporters overlook his blatant lies, his rudeness and his extremely crude language, saying that Hillary Clinton was 'schlonged' by Obama in 2008. When Trump was accused of being vulgar he defended himself by accusing the media of bias. People approve of Trump because he has not been in politics and so is seen as an outsider, which gives them an opportunity to " throw the bums out ". More important, people despise all politicians and so try to pick what they like out of all the promises that politicians make. In India, elections are decided by the poor who vote for whoever promises the most handouts, so there is no real debate about issues and the educated middle class think its a waste of time to vote. Trump's support comes from white working class people who have lost out in the transition of the economy from manufacturing to digital technology and finance and blame immigrants for taking away their jobs. This is apparently what is happening in Germany where support for right wing neo-Nazi is increasing. A few days back there was a mudslide of industrial waste in China. Industrial accidents are common in China but what is remarkable is the large number of excavators digging for survivors, the shining helmets and clean clothes of the rescuers and the advanced evacuation equipment. Contrast that with firemen in Delhi who took off their clothes and jumped bare bodied into sewage treatment tanks near Delhi airport, in this cold weather, to pull out bodies of Border Security Force officers, after a plane accident. No wetsuit or breathing equipment to keep the sewage off their bodies and out of their mouths. The daughter of one of the victims quite reasonably asked the Home Minister why our soldiers keep dying unnecessarily. We have lost hundreds of pilots in accidents because of faulty aircraft. Politicians and civil servants are never exposed to such risks even though they are the highest paid. Defence procurement is highly corrupt, with kickbacks in every deal. Who makes the deals? Politicians and civil servants. This is the real inequality in India. It is not that there are rich and poor, though there is huge inequality there, it is that politicians and civil servants have enormous powers over us and we can do nothing. Ordinary people all over the world are looking for real leaders. All we get are liars.