It could be that the above God, Ganesh (the Elephant God), who is the Hindu patron of arts and sciences is having an influence on the populace.  Then again it might be another of the Hindu Gods or any number of them for that matter (there are over 300 million Gods recognized by Hindus).  But I think the primary influence is on the sciences (broadly speaking) because the people are going to school, getting good educations and then going to work.

Known for its huge outsourcing capabilities (as the recipient), it is not just call centers that are helping with economic growth.  Entrepreneurs seem to flourish in the laissez faire environment the government encourages.  In fact it seems they are pampered by the government.  But success is not an unusual story.

Not just little guys either.

Tata Motors, for example,  is well known globally and is most famous for the Nano –  a car that will sell for $2000 and get 62 mpg!  Think of what that will do for India productivity!  Hey, how soon can we import those little suckers??

The technology segment in India is big with a number of significant players and is growing daily thanks to the millions of programmers, web designers and other ‘technophiles’ being cranked by the excellent colleges and universities.  And then there are the outstanding hospitals and health care professionals that make India a prime destination for medical tourists seeking everything from transplants to knee and hip replacements.  At a fraction of the cost of the same care in developed countries.

India seems to have missed much of the trauma of the world-wide recession.  The Bombay Sensex market has doubled since the lows in March.  Unlike China and Russia the increase seems justified.  Indians, at least those that can afford to, are spending and don’t seem worried about the future.  Those that can’t join the consumer crowd are seeing the opportunities and working to get their children educated so that future generations will move up the economic ladder.

The opportunities in India are immense.  Infrastructure is not good and the government can spend decades and Billions of $$ bringing them into the 21st century.  That will create millions of jobs, require boatloads of engineers, architects and other professionals. The net result: a more efficient, educated and capable population.

This potential is not being lost on the government.  The Prime Minister, Dr. Manhoman Singh, the first Sikh in the office, seems to be a genuine leader who has the vast population in mind.  And it is no wonder given his history.  He was born into a village with no electricity and had to study by candlelight.  Yet, he went on to graduate from college.  He then went to England where he graduated from both Oxford and Cambridge.  As an economist with a Ph.D. he seems the perfect person to help India move forward.  Not too liberal and not too conservative.  He is putting the government’s resources to work.

The efforts are working.

The GDP of India is about that of Russia but there is a big difference besides the fact that it is still growing — India has no significant oil reserves and must rely and true manufactured exports and the skills of their work force.  But there are advantages in those differences . . . those 1.1 billion people provide an unlimited workforce and the life expectancy is ten years more for men than in Russia.  That means an added ten years of wisdom and experience–not a small thing for a nation growing as fast as India.

Then there is the fact that India is a true (and incredibly complex but workable) democracy.  The same 1.1 billion people make elections a challenge and then there are the hundreds of political parties.  Indians have been forced to learn how to compromise and resolve differences.  It is the only way to get things done there!  Americans could learn from them, believe me.  Their elections take about a month as polls are moved about the country . . . and they don’t have two years of preliminary electioneering either (another lesson for us).

I think India is for real.  It belongs in the BRIC but maybe only for another ten or so years.  I just don’t think that their progressive government will allow a damaging slow-down.  In the not too distant future India will be numbered among the ‘developed nations.’   Hopefully that progress will include losing the harmful vestiges of the cold war and a much improved Indian-American partnership will be the result.

I think it is cool!

Thanks to flickr’s exfordy for the pic

America is losing the economic supremacy it has held for over a century.  We have gone from a nation of winners to one of losers.  That goes for the stock markets (I remember just a few years ago a friend of mine from Netherlands wanted only American stocks–now he never calls) and for the real estate markets (losing nearly half of our legacy net worth in just three years).

Even Warren Buffet is concerned with our debt and its growing size relative to overall GDP and frankly he supported Obama and the billions and trillions he has spent on less-important things that are politically expedient (Bush is responsible to).

China is building an economic wall around their own internal interests and we stand by congratulating everyone.  They are buying up up natural resources around the globe and it is easy for them because our $$ is weak and our corporations are running scared.

All the while, our President just wants to make nice (he let that moron Putin ramble and complain for 90 minutes in their first personal meeting before responding).  Our Secretary of State seems more worried about how she stacks up against her former President husband that in accomplishing anything (she embarrassed our country and herself by her outburst in Africa).

I read that developing nations now account for half of the world’s GDP . . . and they are ‘developing’ while we are ‘backsliding.’    We used to be preeminent in this area but now the combined output of China, India and Brazil are equal to that of the United States (estimates from the International Monetary fund . . . but according to other figures from The Economist they aren’t even close when it comes to percapita comparisons).

Huge trade imbalances are washing our incomes and wealth overseas.  Some economists say this is not a problem . . . but of course it is.  At some point America’s debt will be ‘called’ just like that of all of neighbors who are losing their homes.

We have been a nation of spenders, though, due to the recent and unrelenting crisis, Americans are starting to save.

I just wonder if it is too late.  Has the global power shift to Asia and South America become irreversible?  Are America and Europe destined to become the lowest on the economic totem pole in the next generation?

Dang, it seems so and that is NOT a good thing. We have to stop or at least slow the trend.

Our technological and intellectual superiority (education-wise and not inherently) have been a big advantage for decades.  Our abundant natural resources were a tremendous foundation on which to build.  In both areas we are in rapid decline (can’t you remember that incoherent rambling by Miss California in the Miss America pageant?).

Something can be done about this.  Bailing out financial and auto companies and their executives to the tune of several trillion $$ is NOT one of the ways. Let the capitalist economic system destroy the weak and open doors for the strong.

We need to put our money where our mouth is.  We need to ‘recreate’ our infrastructure.  We need to create millions of jobs (there are 12 million more workers in the U.S. now than there were in 2000–yet nearly 7 million jobs have been los!t).  We need to invest in the best technologies and we need to subsidize education so that is available to all (imagine an inner-city ghetto child with an IQ of 150 who is forced by circumstances to forgo an education that just might lead to the discovery of a truly unlimited alternative fuel–then multiply that by ten million or more!).

By the way, one of the things that makes America great is that virtually anyone with the desire, innate capacity and the time can accomplish great things.  Not in China it seems, Newsweek informed us (July 20 issue) that 91% of the 3,220 multi-millionaire Chinese are the children of top Communist Party officials.  Yeah people, that seems fair and balanced!!

Back to the issue at hand.

Sure healtcare is important, but we can’t forget all the other things that make healthcare even a possibility for most.  Create a strong foundation and let’s build up again from there.

I hope Congress (and now the President) who are on vacation for the next two weeks get rested and come back ready to start facing the tough decisions that time will only make worse.  Yet, I fear they only worry about getting re-elected.

America was better when we were an economic power house . . . guess what, so was the rest of the world!

Go USA!!

thanks to smokingpermitted for the photo from flickr

Much of this is smoke and mirrrors.  At least until we (the politicians) generate a bunch more confidence and get a handle on unemployment.

So, what gives?

The market this week was driven by three main stocks.  Goldman Sachs, Intel and IBM.  And you know what all of these have in common, and why you shouldn’t be raiding your mattress for $$ to throw at the market?  They have huge international components to their earnings.

If you take the time you can read all the press releases and you will soon discover that the gains are not a result of a change in perspective by the ‘all important’ American consumer.  These good earnings are a result of positive GDP (Gross Domestic Product — the value of all goods and services) in three of the so called BRIC countries.  Brasil, India and of course China.

These countries have a combined GDP of about $4.5 trillion.  The United States has a GDP of about $13 trillion.  But the U.S. is going to lose ground this year (negative GDP growth) and the BIC (BRIC less Russia) are going to have an average GDP growth of around 6-8%.  Their consumers are spending.  Their governments are NOT running up huge deficits (China even has a huge net SURPLUS — several $trillion).  Their governments are not trying to do too much with too little.

These countries have a population of around 2.6 billion people (the U.S. has 305 million) or about twelve times ours.  So they don’t ALL have to be buying computers, TVs and Toyotas.  But a bunch of them are.  Buying computers with Intel chips and IBM software or consulting.  Plus, because they are growing, the innovators in these countries are growing or starting companies and where do they get the money and financial savvy to do that?   Goldman Sachs and the boys.

DELL, the once dominant American PC company reported disappointing earnings and projections.  Starting to see the picture?

The bottom line:  The U.S. is not even close to being out of this recession.  Obama and his team of ghurus and knuckleheads have got to get a handle on unemployment and rising taxes.  Don’t expect this runup to continue.  If you have some good profits then consider taking some of them off the table in the next few weeks . . . you just might be able to get back in cheaper if and when the next wave of bad news hits (for the traders our there, and not the long-term investors . . . wait are there any of those left?).

By the way, historically the month of October seems to be when markets can take some awful hits–especially if things aren’t going well– and they aren’t and probably won’t be by then.

Too bad we are pumping out bad news all the time (i.e. full speed ahead with universal health care and damn the costs) and the BIC’s are pumping out real infrastructure projects, sensible energy policy (well at least Brasil), and actual economic growth.

Stay tuned.

This ain’t over yet baby!

thanks to epak at Flickr for the photo