Normally wars are great for a leader. You would rarely come across a country that would change its leader in the midst of a war - No matter how incompetent.

George W Bush got re-elected in no small part because of the war in the Middle East.

Roosevelt was replaced because he died! Neville Chamberlain was replaced only because the UK wanted to rebrand its stance toward Hitler.

You see the British hate Jews. They did not want Jewish refugees so badly that they cut out a piece of their “empire” and gave it to the Jews, it’s called Palestine a.k.a. Israel. Even today, only 0.5% of the British population is Jewish.

This was part of the calculus in appeasing Hitler and then he launched Operation Sea Lion.

In the past few months, in quick succession, the incumbent governments in France, Britain, Germany and the US have fallen.

Why?

The US was needling Russia unnecessarily over Ukraine. Russia wanted an undertaking that Ukraine would not join NATO; the US insisted on the opposite. An invasion started. It was the only way for Russia to keep NATO out of Ukraine. The US went to incredible lengths to stop a cease-fire. It kept sending weapons and spent about $183 billion on keeping the war hot.

In addition to that Germany has spent 37 billion euros; France has spent 3.8 billion euros; and Britain 12.8 billion pounds.

The US thought its sanctions would cripple Russia - instead, it was a boomerang that went straight for the pockets of its own people.

Since Europe is a part of NATO it had to fall in line with an octogenarian’s harebrained scheme. Germany cut off the Russian gas supply and had to buy radically more expensive oil from the Middle East. The oil shock that followed pushed inflation through the roof across the world - particularly in the West. They were left with a handful of, what they like to call, dictators that they could turn towards. Oil prices shot up.

There was a time when supply used to have proximity to demand and goods were produced close to their points of consumption. Now it is normal for an apple to have circumnavigated the globe before you consume it. All transport depends on oil and hence everything got expensive.

Here is the thing about inflation. When it comes down, things don’t become cheaper. They get expensive - a little slowly. The last couple of years have been the worst for the poor.

Biden’s election pitch was supposed to be that he has delivered economic growth, unlike anything anyone has seen. GDP growing, low inflation (now), and lowest unemployment rate. But it catered to the rich and ignored the poor.

The current pay hike protest at Boeing was about getting a 40% hike over the next 3 years. Boeing settled for 38% over the next 4 years. The average inflation in the US in 2022 was 7.1%. Do the math. Workers asked for 13% per year and got 9% per year.

What would have cost $100 in 2021 cost $107 in 2022 and now costs about $114 including the 4% inflation during 2023 and 2.6% in 2024. That is 14% from 2021 to 2023. These workers will get 9% a year to offset that while the prices continue to climb.

So when Boeing offers a hike, the workers get poorer a little more slowly!

This is at the heart of what is causing every government to fall. While they hear that their economy is growing, they keep getting poorer and they do not know why.

They are not unemployed, but they are underpaid.

Across the pond, in 2022, Germany had an inflation of 7.9%; France, 5.2% since they still depend a lot on Nuclear and the winner - the UK at 11.1% inflation.

Had the US not fomented war in Ukraine, all of these governments might have been in with a shot at re-election. But they must spend their trillion-dollar defence budget and then some.

For all of the vilification, RFK Jr is undergoing currently, he makes a lot of pertinent points in his speeches. I am particularly moved by what he says about the wages of war. The violence in society and the deteriorating mental and physical health are the wages of war. When a society sends war outside it comes back to the society that perpetrates it.

The price rise is one of those wages that the West has paid. Obviously, it does not hurt the rich. In fact, they make more money through shrinkflation and price gouging.

The poor get hit. To add insult to injury, they are told the economy is growing and things have never been better.

Linkin Park wrote an entire album called ‘Minutes to Midnight’ during the George W Bush Iraq war, which took direct aim at the inequity of the war. In the song ‘Hands Held High’ they say -

My brother had a book he would hold with pride

A little red cover with a broken spine on the back

He hand-wrote a quote inside

"When the rich wage war, it's the poor who die"

At one of the election rallies, Obama was poorly delivering the lyrics of ‘Lose Yourself’ by Eminem. He forgot the song had an intro -

If you had one shot, one opportunity,

To seize everything you ever wanted in one moment

Would you capture it or just let it slip?

The poor (read not the top 10%) took their shot! If the incumbent is not serving them then maybe the other guy would…

Today, one would probably more readily agree to be branded a paedophile than a communist in the USA.

The brainwashing is total and complete.

When you start thinking alike, the small differences get mightily amplified.

Look at the greatest religious animosities - Shia against Sunni; Catholics against Protestants. If you start a debate they would go to the ends of the world. They will tell you how wrong the other side is but are they really that different?

In psychoanalysis, the narcissism of small differences (German: der Narzissmus der kleinen Differenzen) is the idea that the more a relationship or community shares commonalities, the more likely the people in it are to engage in interpersonal feuds and mutual ridicule because of hypersensitivity to minor differences perceived in each other.

Source: Wikipedia

Tomorrow the greatest reality show on television that releases a season every 4 years will wrap up.

My greatest realization this year has been that the US has two ideologies - The Right and The slightly more Right.

There is a tendency to treat these discussions from the standpoint of what is currently happening. It will become a discussion about Biden Vs Trump or Trump Vs Harris. But look at it from the long arc of time say from 1990.

The climate issue was first raked up at Kyoto when Vice President ‘Inconvenient Truth’ was in office and he conveniently stood aside while the US refused to sign on to it. It has been pretty much the same whether a Republican or a Democrat is in office. Biden, the so-called climate-friendly president opened up Alaska to oil drilling. US oil production reached historic highs during the Biden Presidency. The policy has been consistent. The only difference is, the Republicans have not bothered to dress it up as opposed to the Democrats.

War-mongering is something that the country has been engaged in no matter who the President is. Clinton - Kosovo; Bush - Iraq, Afghanistan; Obama - Libya, Yemen, Somalia, Syria; Biden - Ukraine, Gaza, Yemen. Looks like Trump was the only one who did not engage in anything new or perhaps I was unable to find it.

Catering to the needs of the rich is the raison d’être of the US government. They are there to make sure that the rich are not taxed while the not-so-rich pay all the taxes and the illegal immigrants pay as much tax as possible while having no rights at all! None of the presidents/parties have done anything to change this. The Minimum Wage has not moved in 14 years. In the name of capitalism, the US delivers some of the worst treatment to its workers.

Source

On immigration, let us get some facts straight. The US has a total fertility rate of 1.78. The replacement rate is 2.1. Without immigration, the US population would be rapidly declining. The US desperately needs immigration, but pretends it does not. Everyone talks, nobody does anything. It is not like this immigration cannot be made legal. They might have done something about it if illegal immigration was not so profitable. Illegal immigrants have no right but must adhere to all the laws and pay all the taxes, are they not the best?

The US arguably has the worst healthcare not only amongst the OECD but even among most developing countries. The greatest reform that the country received was when Obama launched what we in India call PolicyBazaar.

In the current election cycle, Kamala Harris has the endorsement of a sitting war criminal (Biden) and a past war criminal (Dick Cheney). So we know who is going to dance to the tunes of the Defence Industrial Complex.

Ultimately, this is proof of the fact that the two sides are not all that far apart. Their ideologies are not that dissimilar and their actions even less so.

Going back to what I said in the beginning - If you made a Catholic and Protestant debate over who was better; it would get a lot more heated up than if you asked a Hindu and a Christian to debate it.

America is so polarized because they are so similar. It is a narcissism of small differences that causes hatred and differences to spike so much. This results in intense polarization.

So whatever the outcome of the elections don’t be bothered. It’s a reality show held every 4 years, much like organising a debate between a Protestant and a Catholic to show how great the differences are.

If it really was such a grand choice which could take things down radically different directions would the billionaires in America really allow it to happen?

Germany annexed Austria in what came to be known as the Anschsluss in March 1938. It was not until the 1st of September 1939 that Germany invaded Poland. On the 3rd of September 1939 the same year England and France declared war on Germany and sat on their bums. By August 1940, all of France was under Hitler!

Just feels like wars take longer and longer to progress.

It has been over 80 years since.

The war between Ukraine and Russia could have ended in a matter of weeks, a deal was on the table on 29th March 2022.

Former Israeli Prime Minister Naftali Bennett revealed to Israeli media that he traveled to Moscow as Israeli prime minister last March to broker an early ceasefire between Russia and Ukraine and the two sides agreed to make comprises, but the ceasefire talks were "interrupted" by the West.

[…]

In April 2022, Russian Foreign Minister Sergey Lavrov said that the Russian-Ukrainian talks that were proceeding quite successfully in Istanbul were broken down "on the direct order from the U.S. and London," which "totally controlled" Zelenskyy, who had "evidently received an order from the Washington patrons to frustrate the negotiations."

Source: CGTN

The West was successful and as a consequence had to begin arming Ukraine to the teeth. Now Ukraine is using those same weapons and entering Russian territory.

Ukrainian President Volodymyr Zelensky has acknowledged for the first time that his military is conducting a cross-border offensive inside Russia's western Kursk region.

In his video address late on Saturday, Mr Zelensky said Ukraine's military was pushing the war onto "the aggressor's territory".

Kyiv launched its surprise attack on Tuesday, rapidly advancing more than 10km (six miles) inside Russia - the deepest raid since Moscow began its full-scale invasion of Ukraine in February 2022.

Source: BBC

Now this is a proper legitimate war. No holds barred and the further Ukraine progresses, the higher the likelihood of escalating in myriad ways including Nuclear.

This is in the backdrop of consistent Israeli escalations in the Middle East. One genocide does not a Zionist make. They are itching for more and attacking Lebanon and engaging Hezbollah.

Ultimately this is a proxy fight against the only country that does not sell oil to the US - Iran.

Source: Google Maps

If you look at the map above you should be able to see the proximity of the fighting. Iran and Russia share proximity in terms of geography and ideological alignment against the US. Ukraine and Israel are proxies for the US.

Allies - Axis. Does this echo the history that we have studied?

This entire situation has been precipitated by a demented octogenarian whose memory formation stopped sometime in the 1970s. Stuck in a world where the Yom Kippur War and the Cold War are raging his policy decisions have pushed the world to this edge.

As Jeffery Sachs puts it

The Western narrative about the Ukraine war is that it is an unprovoked attack by Putin in the quest to recreate the Russian empire. Yet the real history starts with the Western promise to Soviet President Mikhail Gorbachev that NATO would not enlarge to the East, followed by four waves of NATO aggrandizement: in 1999, incorporating three Central European countries; in 2004, incorporating 7 more, including in the Black Sea and Baltic States; in 2008, committing to enlarge to Ukraine and Georgia; and in 2022, inviting four Asia-Pacific leaders to NATO to take aim at China.

Nor do the Western media mention the US role in the 2014 overthrow of Ukraine’s pro-Russian president Viktor Yanukovych; the failure of the Governments of France and Germany, guarantors of the Minsk II agreement, to press Ukraine to carry out its commitments; the vast US armaments sent to Ukraine during the Trump and Biden Administrations in the lead-up to war; nor the refusal of the US to negotiate with Putin over NATO enlargement to Ukraine.

Of course, NATO says that is purely defensive, so that Putin should have nothing to fear. In other words, Putin should take no notice of the CIA operations in Afghanistan and Syria; the NATO bombing of Serbia in 1999; the NATO overthrow of Moammar Qaddafi in 2011; the NATO occupation of Afghanistan for 15 years; nor Biden’s “gaffe” calling for Putin’s ouster (which of course was no gaffe at all); nor US Defense Secretary Lloyd Austin stating that the US war aim in Ukraine is the weakening of Russia.

At the core of all of this is the US attempt to remain the world’s hegemonic power, by augmenting military alliances around the world to contain or defeat China and Russia. It’s a dangerous, delusional, and outmoded idea. The US has a mere 4.2% of the world population, and now a mere 16% of world GDP (measured at international prices). In fact, the combined GDP of the G7 is now less than that of the BRICS (Brazil, Russia, India, China, and South Africa), while the G7 population is just 6 percent of the world compared with 41 percent in the BRICS.

Source: Jeffery Sachs

Jeffery Sachs is a professor at the University of Columbia. He served the UN, he is no hack job.

Of course, this is not new so far as America is concerned. The bedrock of the country was making agreements in bad faith with the natives and reneging on those agreements time and again. It is quite literally how the country was created.

Recently while reading the book “Raven Rock”, a book about the US plans to secure the government during a nuclear strike, I got to learn about the Cuban Missile Crisis blow-by-blow.

Whenever I have read about the “Crisis” I have always thought of it as a gross overreaction by the Americans. There were a few missiles kept in another country that happened to be close to the USA.

So what?

You see in others, what you are.

The USA is a trigger-happy country that does not think twice before spilling blood, they expected the Russians to do the same. If you read some of the discussions taking place at the White House, it would have seemed like bombs were going to start raining in the next 15 minutes.

You know how you psyche yourself up sometimes that something bad is going to happen? The Pentagon was doing that.

So given the bouts of dysentery that the Americans had about some missiles in Cuba and how they invaded the Bay of Pigs! Why is Russia not justified in doing the same when every Western nation promises to put its weapons in Ukraine by including it in NATO?

For 2 years, the Americans have used the Ukrainians as fodder to paint Russia in poor light. By stepping into Russia, Ukrainians have created conditions where the Russian people can galvanise.

If it was Mexico that was attacking the US with Russian weapons and their soldiers had gone 20 Km inside Texas, what do you think the Americans would have done?

As if having fomented all the grief in Ukraine and Palestine was not enough, the Americans had to finger around in the Indian subcontinent as well!

In a democracy, it is possible to foment a colour revolution and displace the leaders, as the CIA recently accomplished in Bangladesh.

A letter allegedly from former Bangladesh Prime Minister Sheikh Hasina was circulating among supporters of her Awami League party over the weekend, suggesting that her ouster after 15 years in power was the result of pressure from the United States (US) regarding St Martin's Island in the Bay of Bengal.

"I could have remained in power if I had left St Martin's and the Bay of Bengal to America," the letter reportedly said.

Source: Business Standard

We all know the kind of security that any head of state is afforded. Even in the poorest nations. You have the police, the military, and the entire legal apparatus. It takes a lot of money to render all of them impotent which is a necessary ingredient for a colour revolution.

You cannot do that in a country like Russia because people are not serving due to protocol they are serving Putin out of loyalty. You cannot buy them out. This is why America loves a democracy. There are always those you can buy.

Sometimes silence speaks louder than words.

Notice how Russia seems least interested in repelling the Ukrainians? The more they progress into Russian territory, the more the country galvanises. Even the most disciplined army will rape and kill. The more of this happens, the more justified an extreme step would seem.

In the meantime, as the bird flies, just 2000 km south of Ukraine the seeds of a battle are being sown. It would not take a huge leap for Russia to align with Iran and decide to clean the slate in the entire region.

The problem today is often in identifying a monopoly. Is Facebook a monopoly? They will claim that other platforms compete with them in various areas. Is Google a monopoly? Sure, there are other search engines, but would you survive if I forbade you from using Google? Google has over 80% market share. Most computers and mobiles come with Google as default, in my opinion, it is certainly a monopoly.

Then there is a market definition argument.

Is Amazon a monopoly? Well, Amazon would say that it is a retailer and it occupies a very small share of the retail market. Probably why it bought Whole Foods so that this argument would hold water.

In today’s environment, it has become harder and harder to pin down monopolies.

But why are monopolies such a bad thing? Are there not diminishing costs to scale? As they become bigger does it not get cheaper for them to make things? Sure it does, but…

Back in the late 1800s America was filled with monopolies, Oil monopolies, Railroad monopolies, and Electricity monopolies. Often what happens is that when you are the only game in town you get complete pricing power.

Take electricity; today, it is classified as a utility and is highly regulated. You cannot go around raising prices willy-nilly. It was not in 1890. So a company supplying electricity could increase the prices without cause. If you don’t like it, you can disconnect your power. The consumer had no choice.

Also, one large company could acquire all the rest of the competitors and eliminate all competition and choice. This is exactly what a gentleman by the name of John Rockefeller did. He created a Trust and brought all of the companies under the Trust. The Trust was solely controlled by him. So while there were many companies and the illusion of choice, there was none.

A Senator from Ohio, John Sherman sponsored a bill which went on to be called the Sherman Act which broke such Trusts and introduced Anti-Trust action.

A trust is an arrangement by which stockholders in several companies transfer their shares to a single set of trustees. In exchange, the stockholders receive a certificate entitling them to a specified share of the consolidated earnings of the jointly managed companies.

Toward the end of the 19th century, trusts come to dominate a number of major industries, destroying competition. For example, on January 2, 1882, the Standard Oil Trust was formed. Attorney Samuel Dodd of Standard Oil first had the idea of a trust. A board of trustees was set up, and all the Standard properties were placed in its hands. Every stockholder received 20 trust certificates for each share of Standard Oil stock. All the profits of the component companies were sent to the nine trustees, who determined the dividends. The nine trustees elected the directors and officers of all the component companies. This allowed Standard Oil to function as a monopoly since the nine trustees ran all the component companies.

The Sherman Anti-Trust Act authorized the federal government to institute proceedings against trusts in order to dissolve them. Any combination "in the form of trust or otherwise that was in restraint of trade or commerce among the several states, or with foreign nations" was declared illegal. Persons forming such combinations were subject to fines of $5,000 and a year in jail. Individuals and companies suffering losses because of trusts were permitted to sue in federal court for triple damages.

Source: National Archives

Incidentally, it is the same Trust structure that has been weaponised by all the so-called Philanthropists to hoard their money and keep it safe from being taxed.

But I digress.

The Sherman Act was meant for consumer protection. If a company was acting like a monopoly and squeezing the customer then anti-trust action could be initiated against such a company. There have been over 140 antitrust cases fought in the US since the introduction of this bill

Anti-trust cases have also been fought when companies have acted in a manner that has prevented competitors from entering a market. The most famous of these was Microsoft bundling the Internet Explorer along with Windows. Windows in the late 90s was a true monopoly and had close to 95% of the market share. By bundling IE, they were making it impossible for other browsers to enter the market.

The Sherman Act and competitive authorities across the world protect the demand side of the economy.

The current state of competition laws ensures that the demand side is not hurt but they don’t do much about the supply side.

When Swiggy started in Bangalore back in 2016, they used to take a respectable 10% - 15% from the restaurants to provide delivery services and sourcing the orders. Their popularity grew, their market power grew and their ability to negotiate grew. They went from 15% to 25% and are now at 35%. A third of whatever you are paying for your food just goes to Swiggy.

When you order something from Amazon, sellers are fighting one another to get into the buy box, this involves offering the lowest price and highest service quality. At the same time they have to pay Amazon a percentage based on category which can go as high as 25% and then there is a closing fee and a shipping fee and other fees.

I suppose you see a pattern here.

The consumer gets a great deal! They get the lowest prices. But the producer or the supply side of the economy is getting squeezed by these monopolists who offer them no other way out.

For gig workers, the situation is even worse.

Meet Rakesh, a delivery partner with one of India’s top food delivery platforms. This chap is literally a machine, pulling off 100 deliveries a week and 14-hour days. His hustle earned him a gold-level rating, unlocking some sweet perks. For context, some food delivery companies have a ranking system split into gold, silver and bronze, based on how much and how well their delivery partners work. When their ratings go up, so do their perks. And for Rakesh, that translated into a company-sponsored health insurance policy for him and his family.

But then, out of nowhere, Rakesh’s wife got really sick. He had to take time off work. And bam! His ratings tanked. See, these platforms use automated systems to monitor everything — work hours, earnings, customer feedback, you name it. So, when Rakesh wasn’t working, his rating dropped like a rock. And with that, he lost his insurance benefits and ended up paying over ₹1,00,000 for his wife’s hospitalisation out of pocket.

Source: Finshots

This is true across the world. Not only are the workers not classified as employees, but they do not have the flexibility to show up when they please and turn off when they don’t. The companies want them to work almost like automatons who are there to fill in statistics on their dashboards.

Somebody needs to protect them?

Our comfortable lives are currently standing on the backs of micro and small entrepreneurs who are being squeezed to their bones by platforms that control all of the market access.

Every corporation operates on the principle of maximising shareholder returns. They are ruthless and immoral when it comes to delivering that. While there are laws to protect the consumer there are none that protect the suppliers and this needs to change.

If 100,000 people have an issue why would Microsoft build for them? What difference would an additional million dollars make to their P&L. They would be scouting the next multi-billion dollar opportunity because that is what is going to move the needle.

In the hyper-financialised world that we live in, everything is measured in terms of percentage growth. And it is not that a million is not a lot of money it is just that as a percentage of 100 billion it is nothing.

But then political operatives took this same thinking and dove into creating voter blocks or niches.

I think this is responsible for creating identity groups based on anything and everything including who somebody is sleeping with.

It was first gay and lesbian. Then it became lesbian, gay, bisexual and transsexual. Now it has become an alphabet soup.

They are referred to as LGBTQIA+; they have themselves given up and just added + because a new category seems to emerge every few months.

According to the Gallup poll in the US, 7.1% identify as LGBT.

In the United States, poverty has both social and political implications. In 2020, there were 37.2 million people in poverty.

Source: Wikipedia

That is more than 11% of the US population. But you see they are poor!

They don’t go out to vote in large numbers.

Politicians go where capitalism goes. You cannot raise any money from them. You can’t even sell them flags, hoodies and t-shirts. Are you planning to sell them T-shirts that say “Poor Despair”?

People will be like there is homophobia, they are differently treated by society. Well so are the poor. It is just that it serves political ends to talk about homophobia rather than Aporaphobia; you have not even heard of that word, have you? I just found out right now, myself! As I was typing, it got autocorrected to agoraphobia.

There is nothing changed societally. People who were disgusted by those who are gay, continue to be. Those who did not have a group to identify with - align. The rest did not care before and don’t care now.

But, a voting block was created that will swing in one direction.

The west has a fertility problem.

The cost of child rearing is so high, that most people in the west are abstaining from having children.

Source: Wikipedia

The replacement rate of fertility is 2.1, anything lower than that indicates a declining population. Europe and US are well below 2.

If you want to play around with models having different fertility rates, you can go to this site and knock yourself out.

Now, if you have listened to stock market news for even a minute, the only thing they care about is growth. If you have fewer people to sell to, your economy will eventually decline no matter how good your marketing is. There is only so much that you can make people consume. They are not going buy a dozen refrigerators.

Migrants, no matter how poor need to consume. They need to eat, they need shelter and they need other things like clothing, etc. The presence of immigrants only increases consumption and hence causes the economy to grow. Outsourcing does not create consumption in the local economy.

The real reason is outsourcing and not immigration. Outsourcing meant to preserve the environment has taken jobs to other countries. The rich get to make money irrespective of where the products are produced, whereas the poor are often just robbed of their jobs.

When they cite the unfairness of it all, the only boogeyman that the politicians are able to find are the immigrants.

Hence the shift towards the right. The recently concluded elections in the EU show a strong shift towards the right in countries like Germany and France.

You cannot keep blaming the immigrants and expect people not to vote into power, those who promise to remove them.

In the meantime…

Exhibit C: The Giving Pledge is a promise to give the majority of your wealth away by the time you die. The Pledge receives a lot of press. Bill Gates and Warren Buffet introduced it in an effort to spur billionaire giving above the anemic 10% that’s been the norm. The good it has done, however, is dwarfed by its promise and PR. “Giving” excludes political donations, but that’s about it, and notably permits the same private foundations that billionaires have long used to avoid actually giving anyone else a dime. There’s an organization behind the Pledge that coordinates events and conversations between members, but I believe this has (mostly) been window dressing, obscuring an obscene level of income inequality that runs unfettered. Gates and Buffet are richer than when they started giving; the 73 members of the Pledge, who were all billionaires in 2010, have tripled their collective wealth in the past decade. Wouldn’t a more apt name be “the Hoarding Pledge”?

Source: No Mercy No Malice

Elon Musk was just awarded a pay day of $46 billion by Tesla shareholders. Why? He may not be in a position to do any good for Tesla but he can certainly do a lot of harm. He can quit the company, badmouth it on Twitter and destroy shareholder value in an unprecedented manner.

This hoarding and inequality is the problem, not the immigrants.

Once the right rises and the immigrants are shown the door, the fun will really begin then. Then the West will be left with a Resident Crisis also known as a Revolution!

You hire two chefs who create some of the best bakes; customers love it. The demand is so much that you sell out every day and by the end of the year, you note that you have been able to generate a huge profit for the year.

What do you do?

You could pat yourself on the back and compliment yourself for making such amazing hires and take all the money and put it in your bank.

OR

You could recognise the talent and efforts of those who have made this success possible and take a portion of the profits and reward them with a bonus and then take the rest of the profits.

If you thought option 2, you are not cut out for business.

It is only fair to give some of the profits generated to those who made the profit possible in the first place.

In the real world that is not what happens.

Take Apple for instance.

They give stock grants to top executives whose job is to ensure that they are working towards increasing the share value of the company.

The vast production chain has been outsourced and these people would never get to partake in any of the profits that are generated. Apple would probably be using its economic power to ensure that it is squeezing these companies to offer lower prices and by extension pay even less to their employees.

On the other side are the retail workers which forms the vast majority of the employees on Apple payrolls. They are also paid incredibly low salaries and there is no universe in which they could get a stock grant or a stock option. The situation is so bad many store employees are trying to unionise.

Despite all the patents and all the technologies, if the factory workers and retail workers were not to do their best to deliver quality and customer service Apple would not be as successful as it is.

Apple produces incredible profits and recently announced $100 billion in stock buyback.

It also means that the company does not have any avenues to invest this money and generate a return on investment.

In the entire bargain, it is assumed that the people who made this all possible do not deserve a single penny more.

This is fundamentally what is magnifying the inequities in wealth.

In the eyes of Wall Street, the profits were generated because the CEO has a big brain. All of the compensation is laid at the doors of the CEO when a bumper profit is generated. Everyone else is just a cog in the machine.

When those profits are not generated it is not like the CEO is fired. There are layoffs made where the very people who were robbed of any upside in the first place are fired. For those who remain, they are expected to produce just as much output or more with fewer resources.

Thanks to index funds and the rise of private equity a large portion of the global economy is controlled by a few.

Although it’s a relatively young industry, private equity firms controlled $8.2 trillion in assets globally last year, according to consultancy McKinsey & Company.

[…]

These are the top five firms, which raised a combined $474.2 billion in capital in the five-year period ending March, 31 2023.

Source: Quartz

These tricks are being used by companies across the world, not just in the US because a significant chunk of the global economy is controlled by these firms.

Stock buybacks have become the preferred way of raiding the company’s coffers. “Activist shareholders” take a position on the board and force companies to engage in stock buybacks to inflate share value and no sooner is it done, that they dump the shares and walk away.

This has earned Private Equity investors the monicker “Vulture Capitalists”.

The worker, whether in a factory, in a mine, a retail store or in the supply chain almost sees none of the profits that they generated by toiling in soul-sapping conditions.

Squarely explains the rise of populism and right-wing conservative thinking.

Anybody who can promise a glass of cold water to a person living in hell!

When a flat-eather writes “Everyone around the world knows that the earth is flat.” It gives away a worldview that has been imbibed through language into their psyche.

Democracy in principle is a rule by the people, of the people and for the people.

In principle. Language gives it away.

People only have any say once in 4 or 5 years when they are manipulated into making choices. The fact that the people do not have any power at all is also revealed by the language we use.

In India we have a term for the party that gets elected to office - “Ruling Party”. If someone is ruling, then there must be someone who is ruled. More importantly, ruling is something that monarchs do; not people who have ostensibly been elected to perform a public service. They are public servants. What do you do when you are unhappy with a servant?

You FIRE them! Without notice in most cases.

In the case of democratic servitude, this act is made almost impossibly difficult AND can only be triggered by others who are also servants. These servants are the judge, jury and executioner.

The thing that we call democracy is not that at all.

If you were to elect a representative and that representative happened to vote for a bill that turns your neighbourhood into a garbage dump, you have NO recourse whatsoever. NONE!

You can call, write to them, even try to meet them but you cannot do anything about it till the next elections!

This is true as much with the ruling party in India as it is with the “party in power” in the USA or England.

In the meantime every 5 years we show up stupidly to cast our vote. To choose between bad and worse.

If Democracy were real, winners of the election would be called the ‘Serving Party’.

The Yom Kippur War had not ended well for the Arabs and given this path to almost unlimited wealth, he did not wish to upset the apple cart.

He took all that energy which Osama had and diverted it towards Afghanistan. The Russians were fighting the Muslim brethren and Osama could save them by fighting those infidels. The CIA covertly financed Osama because an enemy of an enemy…

Al Qaeda was born.

Arguably Al Qaeda and Islam are distinct. But in the aftermath of 9/11, those distinctions were not seen. The government did not understand it, let alone the common people. Scores of Muslims who ended up in Guantanamo Bay would testify to this. Islamophobia became a thing, not very different from anti-semitism.

Al Qaeda was a terror organisation that happened to be Islamic.

The Zionist movement is a terror organisation that happens to be Jewish. Its roots predate the Second World War. In the 1930s the Zionists were negotiating with Hitler for Israel.

Osama Bin Laden and Al Qaeda wanted a separate nation where ostensibly puritanical Islam could be practised free of the influence of the infidels (The West). The Zionists wanted a puritanical state as well.

Chamberlain had negotiated with Hitler. Thus the Zionists knew that the British were not averse to negotiating with genocidal regimes. Once Hitler fell, they negotiated with the British and Israel was carved out of Palestine.

In the aftermath of the Second World War, they were awarded the country as a penance for English inaction during the 30s. They swung into action once the war arrived at their doorstep. They took a nation that they had colonised - Palestine - and handed it over to the Zionists who rebranded it to Israel.

The actions of Al Qaeda were not that of all Muslims, it was that of one terror outfit. But all Muslims came under the scanner.

What is happening in Gaza is Zionist action and not Jewish. The problem is that the West is unwilling to make this distinction; so much so that they do not even mention the word Zionist.

A day will come when the tide will turn and much like the innocent Muslims who ended up getting tortured in Guantanamo, many innocent Jews will end up subjected to a new wave of anti-semitism.

There was a time when this distinction used to be made. Hitler was Christian and almost every Nazi was Christian but that did not imply that every Christian was Nazi.

The 2024 election is between a demagogue and a man stuck in the Cold War. One is focused on destroying the inside of America and another on destroying everything outside of it.

After 100,000 people cast a dissenting vote during the Michigan primaries against Biden because of his enthusiastic support for the genocide in Gaza, Biden started to question Netanyahu.

During the last election, many of the states were won by a margin of 10s of thousands of votes. 100,000 absentees would be a veritable disaster.

Look at what Trump is doing, he said - Every jew who votes democratic, is someone who hates their religion.

This forces Biden and the rest of the Democrats to support the Zionist genocide since they have been unable to make the distinction between Jews and Zionists.

On the other hand, Trump is trying to go for the Jewish vote as well as the Arab-American vote - if not go for it, at least keep them away from Biden. This will be an election of attrition. It will come down to who is hated more and who is seen as more incapable.

If only the Democrats had made the distinction. If only they had not invoked the police state when groups of Jews were protesting and carrying banners saying “Not in my name”.

If only…

A corporation such as Apple borrows money using bonds and their interest rate negotiations tend to be in basis points (bps in industry parlance). Apple would be bargaining between paying 1.75% or 1.85% per annum interest, a difference of 10 basis points.

When a well-to-do individual needs to buy something expensive such as a car or a home, they borrow money from banks and they often negotiate percentages. You might end up paying 4% - 5% per annum in the US or 8% - 10% per annum in a country like India which has high inflation.

Poorer people end up borrowing to tide over the month and many of them use credit cards or informal channels of lending. In the case of a credit card, a non-payment can send your interest rates from 24% to 42% per annum and informal lenders (loan sharks) end up charging as much interest for a month.

Not to mention the criminal fees that credit card companies slap on over and above the interest which brings the actual interest paid to 60% - 75%. Let us average that out at 50%.

Now if you had $1 billion who would you want to lend to? Depends on your risk appetite, but think about it.

Apple would give you $17.5 million on that capital. If you gave it as a part of a credit card, you would get 500 million on that same capital.

In Hindi we have a word - Aukaad which loosely translates to status; but does not have a literal English equivalent. Rich people have it and poor people don’t.

So while Apple can borrow $1 billion, a poor person cannot. So the banks and other financial institutions find a million people and give them $1000 credit cards to extract the $500 million in interest.

Over the past 8 years, there has been an explosion in the number of companies that have been taking advantage of the low-interest rate environment that was unleashed by the 2008 crisis to start lending companies that use an App and hence are euphemistically known as Fin-tech companies.

Every payment company everywhere in the world is a lending company that is masquerading as a payment company. Processing payments is not a very profitable business. In India, they get to charge 2% at most, and in the US about 3%. 60% - 80% of that goes to VISA and MASTERCARD. After all costs, they are left with 10 basis points or about 0.1%.

Now take a company that is processing $1 billion, they get about $1 million in revenue out of it!

That probably covers the server costs. Rents, salaries and other costs need to be financed with VC money. Their only salvation is lending.

Startups being startups don’t call it Credit Card - They call it Buy Now, Pay Later. I wrote about this a while ago.

When you scale a bad idea quickly -

Source: Quartz

The last time interest rates peaked like this, was in 2007. That time it was mortgages that caused the spike, this time around…

Source: Quartz

Banks take deposits from depositors and pay them a measly rate of interest. They further lend it out to Non-Banking Financial Corporations at a higher rate, who then lend it out or create a line of credit to a fintech company that further lends it out to individuals.

When individuals default on payments to fintechs, they would have to default to NBFCs who would then struggle to pay back the banks.

Credit card rates, which make themselves felt in wallets much more immediately, have jumped from less than 15% on average in February 2022 to nearly 21.5%. Data from the Federal Reserve Bank of New York (pdf) suggests that there has been a big spike in the amount of credit card and auto loan debt going into delinquency. And that’s on top of student loans coming back into the economic picture.

Source: Quartz

Some point to the rising federal rates for this spike but that is rubbish. It is not like credit card providers were charging 4% interest before the rates spiked. It would have been an excuse to increase already sky-high rates a bit more. Much the same way that the oil companies profited from the Ukraine war.

At the same time, they are pushing the late payment fees higher and higher since the credit card industry has been undergoing a consolidation over the years.

In response to new late-fee caps announced on Tuesday, the banking industry’s largest trade group is arguing that consumer penalties and sky-high interest rates account for the risk of people failing to pay their credit card bills. But as a recent federal report showed, credit card companies have nearly doubled the interest rates they charge to consumers — far outpacing the financial risk they’re taking on by lending people money.

[…]

Critics argue that as a handful of companies now control most of America’s credit card transactions, lenders are able to use their outsize market power to increase rates far above the underlying interest rate the Federal Reserve sets for credit cards without fear of price competition. And they say the situation will worsen if regulators approve a proposed merger between Capital One and Discover.

Source: Jacobin

And like that the minimum wage workers are being robbed blind to make the rich, richer.

The first question is how long can this party last? How long will credit card holders be able to keep up with these interest payments? I think the days are numbered.

The second question is what happens when the party stops? The first to go will be the Buy Now, Pay Later companies and fintechs who are lending at insane speed to justify their valuations. Then depending on how well they are capitalised with VC money, the next domino will fall and so on.

Why? Cheap thrills!!

Unable to come up with an explanation, all the punditry mentions news from weeks or months ago that could have caused it.

So much for rationality.

Markets exist for price discovery.

When it comes to valuing companies millions of people use theories that were propounded half a century ago to arrive at a value.

In the stock market, all the information about a company is available. Then, based on the theories mentioned above a valuation can be arrived at. Despite this, we still find one group of people who think the price is right to sell and another who think the price is right to buy. If all decisions are rational, then one of them is wrong.

But all decisions are not rational. In some ways, this is just a reflection of the optimist vs the pessimist.

How can one person think a stock is undervalued when, at the same time, another thinks it is overvalued?

The mere fact that trades are executed every day on the stock market is proof that humans are not rational.

Law

Laws are rules.

According to Greek mythology; Persephone, the daughter of Zeus and Demeter, was abducted by Hades the god of the underworld because he was extremely taken by her beauty. Demeter looked for her daughter all over the Earth. She went crying to the sun god who revealed to her that Hades had kidnapped her daughter.

Upset that Zeus had not revealed this to her, Demeter the goddess of fertility took a leave from her duties and terrible starvation visited the lands. Hearing this, Zeus sought to find a solution. It was determined that Persephone would marry Hades and become the Queen of the underworld and would spend 6 months with her mother and 6 months in the underworld.

When Persephone goes away to visit Hades, Demeter becomes sad and fertility reduces and these 6 months are known as Winter.

Except the Greeks did not know Australia where it is summer at the same time. Australia is very much on the Earth and not in the Underworld.

Centuries later, the actual reason for the onset of winters was explained. It has nothing to do with Zeus, Hades, Demeter or Persephone and everything to do with the tilt of the Earth

When you have a rule or an explanation that requires exceptions, you can rest assured that the rule is wrong.

Murder is wrong in almost every law. Except -

• In self-defence

• In a fit of insanity

• If a person is mentally unwell

Are not all of us mentally unwell? To some degree…

That aside, if we are all irrational, (at least those participating in the stock market do not seem to be!), then should there even be laws?

Underlying every law is an assumption that a rational human would act in a certain way. But if humans are not rational then should laws exist? Can you even use the same yardstick for everyone?

Of course, you should not. But laws were invented to serve capital.

Capitalism

Even an animal leaves the carcass for other animals once it is done. All life on earth takes as much as it needs and leaves the rest.

Humans, on the other hand, would do anything to keep “their” food from falling into the hands of another. We will preserve, refrigerate, and even bury it in the ground to keep it from going to another.

How is hoarding up food when others are starving rational? Isn’t caring the foundation of humanity?

Margaret Mead, an anthropologist was once asked what is the first sign of civilisation.

The Femur connects the hip with the knee, it is one of the longest and strongest bones in the body. In the wild, a fractured femur is a guaranteed death. You can no longer run, hunt, or do anything in fact and it takes weeks to heal. A human with a broken femur that has healed is the surest sign of civilisation. The first one to be discovered is 15,000 years old.

To care is to be civilised.

What do you think would happen to a homeless person with a broken femur in your city?

Capitalism is the religion of the insane. Governed by laws that assume everyone is rational.

At the same time, news began to emerge about the “hallucinations” that LLM was often engaged in. LLMs are autocomplete on steroids. They are not fact-checking machines. A lawyer in the US got fined because he used ChatGPT to come up with case precedents. The software gave him precedents without checking if they existed or not. They did not!

The one thing that ChatGPT is very good at which has been much overlooked is - Writing Code. There is a lot of content on the internet of people trying to fix their code and find solutions to bugs. This excellent training data has provided the LLM with comprehensive code data.

Hence, rather than content writers, it is code writers or software programmers who are becoming redundant. 90% of the people who write code essentially go into Stackoverflow looking for code snippets that can be copied. I have had engineers tell me during interviews - that anybody can go to Stack Overflow and look at code, but an engineer knows what to copy and paste.

In this copy-paste world, the coders are the ones that are the easiest to lay off.

The numbers: Fourteen days into the New Year, 46 tech companies have laid off ~7,500 employees, per layoffs tracker Layoffs.fyi. Some notable announcements:

Google confirmed it was axing about 1,000 employees last Wednesday across its Google Assistant, core engineering, and hardware teams that work on Pixel, Nest, and Fitbit.

Amazon cut hundreds of people working in its Audible, Twitch, MGM Studios, and Prime Video units.

Discord, the messaging app with IPO ambitions, slashed 17% of its staff.

Apple, which avoided the mass-scale layoffs of its rivals in 2023, is shutting down a 121-person team working on AI in San Diego, Bloomberg reported.

Source: Morning Brew

All of them have fired people in core engineering teams. I am certain these jobs have been eliminated because code can code. LLMs can write code and making it copy-paste should not be that hard.

Duolingo laid off 10 per cent of its contractors because of AI.

*Bloomberg* reports that a spokesperson for the language learning app said Duolingo doesn’t as many people anymore to perform the contractors’ work, adding that “part of that could be attributed to AI.”

The spokesperson also said AI isn’t a “straight replacement” because workers are already using AI to help them work. Duolingo has long used AI, having incorporated chatbots in 2016 and OpenAI’s Chat GPT-4 early last year.

Source: Verge

In 1500 it would take about a man-years worth of work to weave the sail of a ship. Weaving was lucrative and workers craftspeople used to be handsomely paid.

Then technology came in and…

• Took the skill out of the production

• Made it easier to weave in quantity

• Destroyed the value of the individual involved in the trade

Beyond Yoga was worth $400 million in 2021, when it was purchased by Levi Strauss. Its leggings retail for about $100. Like many brands, the company relies on garment-sewing contractors to stitch together its products. In the US, such contractors pay workers as little as $1.58 an hour in the most egregious cases.

Source: Quartz

Is history going to repeat itself? Are computer engineers going to go the way of garment workers?

250 years ago, Ned Ludd could lead garment makers to revolt and break the machines that were robbing them of their jobs. They were called Luddites. Today, the rich strangled power in such a way that it would not even be possible for such a movement to take root. The Police state serving the rich would finish them.