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Gold grand prix – The Chinese challenge

Total Gold demand - Top world markets (Image courtesy 0 ft.com). Click for a larger copy.

Total Gold demand - Top world markets (Image courtesy - ft.com). Click for a larger copy.

Golden ambitions

Western media has breathlessly announced that India’s leadership of many centuries as the largest buyer of gold has been broken by the Chinese. What does this mean for India and China? Not to forget the rest of the world. In the last few months,

India and China combined to contribute 63 percent of the total gold jewelry demand in the world in the first quarter.

Investment demand has grown (in China) by an average 14 percent a year since deregulation of the market in 2001, “a trend that has continued with the strong growth momentum witnessed in the first quarter,” it said. China’s investment demand jumped 123 percent to 90.9 tons in the first three months, compared with an 8 percent rise to 85.6 tons for India.

The country’s total (investment + jewelry)  gold demand in the first quarter jumped 47 percent from a year ago to 233.8 tons, the council said. That still lags behind Indian consumption of 291.8 tons, according to the council. (emphasised text in brackets supplied.)

Gold-to-silver ratios in the past few decades. Image courtesy - wsj.com. Click for larger image.

Gold-to-silver ratios in the past few decades. Image courtesy - wsj.com. Click for larger image.

Law abiding citizens

International regulatory damping of gold demand – especially in USA, India and China eased from 1975 onwards – from December 31st, 1974, with Executive Order 11825 by Gerald Ford.

Unlike India, which was well serviced and supplied with gold by the Indian underworld, China and the USA were deprived of gold supplies during this regulatory blackout of nearly 50 years. Current growth in demand for gold in China is building on a

low base which means that the investment demand and demand for an inflation hedge from 1.3 billion increasingly wealthy Chinese people is more than sustainable.

The not realized important fact that the people of China were banned from owning gold bullion from 1950 to 2003, means that the per capita consumption of over 1.3 billion people is rising from a tiny base. Gold ownership by the Chinese public remains minuscule. Especially when compared to other Asian countries such as Vietnam and India.

Should the Chinese economy crash as some predict, demand could fall. However, sharp declines in Chinese equity and property markets and a depreciation of the yuan would likely lead to significant safe haven demand for gold. Chinese demand alone likely puts a floor under the gold market at $1,450/oz.

It is worth noting that the People’s Bank of China’s gold reserves are very small when compared to those of the U.S. and indebted European nations. China appears to be quietly accumulating gold bullion reserves. As was the case previously, they will not announce their gold purchases in order to ensure they accumulate sizeable reserves at more competitive prices.

China – Biggest gold producer and consumer

China is already the world’s largest producer of gold from 2007, for four years now. China has captured the top position from

South Africa, which was producing as much as 1,000 tons of gold in 1970, (but) has seen its mining production decline for five straight years.

Accelerating a drop in output last year, the country’s mining authorities started a crackdown on unsafe mines after 3,200 workers were trapped at Harmony Gold Mining Ltd.’s Eldestrand mine in October.

Following an order by President Thabo Mbeki, the mining commission in the last three months started to requiring gold mines that suffer a fatal accident to suspend operations while a safety audit takes place. (emphasised text in brackets supplied.)

In 2010 Chinese gold production was

340.88 tonnes of gold in 2010, retaining the position of the world’s largest producer of the precious metal, the China Gold Association said. The number of domestic gold producers shrank to around 700 at the end of 2010, from 1,200 in 2002, through mergers and acquisitions

Further recently, the Chinese Government, through public sector companies, bought South African gold mines from the Australian owner.

Citic Group, China’s biggest state- owned investment company, and partners agreed to buy Gold One International Ltd. (GDO) for about A$444 million ($469 million), gaining gold assets in South Africa.  China Development Bank Corp. and Long March Capital Group are the other members of the bidding group, which is seeking as much as a 75 percent stake and plans to keep the company trading in Australia and South Africa, with a potential listing in Hong Kong. Citic is bidding through its Baiyin Non-Ferrous Group Co. unit and China Development Bank through its China-Africa Development Fund.

Gold One operates the Modder East mine in South Africa and also has projects in Mozambique and Namibia.

A frothing-at-the-mouth FT.com found many reasons to critique the deal.

China and silver

The other big story is silver. Why this sudden spurt in prices? How sustainable is price increase in silver?

Silver is down nearly 30% this month in volatile trading. Such a move in the Dow Jones Industrial Average would equate to an eye-popping drop of more than 3,700 points. Tony Crescenzi of Pacific Investment Management Co. called silver’s parabolic rise and subsequent skid a “tulip mania-style move.”

Silver backers counter that even with its recent drop, the lesser precious metal has retained a nearly 80% gain over the past year.

While gold supply is well understood, silver bulls and bears argue about just how much silver is out there. Some analysts make the case that silver in batteries and photographic film is “recycled” back into the market, reducing scarcity. Silver bulls, of course, think that’s a bunch of poppycock.

More important, the gold-silver price ratio has gotten out of whack. During most of the past 10 years, the ratio hovered around 60, meaning gold was 60 times more expensive than silver. Silver’s incredible surge over the past year has pushed the ratio down to 43, a level not seen since silver’s last crazed phase in the early 1980s. At its peak, back on April 29, the ratio narrowed to 31, a level not seen in three decades.

Silver bulls will argue that the gold-silver price ratio should reflect the 15.5 level authorized by France in 1803, or the 15 level outlined in the U.S. Coinage Act of 1792. It’s more likely that the ratio will revert to modern-era norms rather than race back to the Napoleonic era. And that means that gold, more than silver, looks like the solid store of value today.

Behind this huge spike in silver prices

The Chinese.

As 2ndlook has pointed out earlier, Chinese love silver – and Indians love gold. Most of Chinese consumption of gold is by a few well-heeled elites with guanxi.

But only look at the Chinese trading frenzy in silver.

Chinese speculators have emerged as a big driver of silver’s spectacular rally and subsequent crash with trading in the metal in Shanghai soaring nearly 30-fold since the start of the year.

The commodity, nicknamed “the devil’s metal” for its wild price swings, surged 175 per cent from August to a peak of almost $50 a troy ounce two weeks ago. Since then, it has plummeted 35 per cent, hitting a low of $32.33 on Thursday.

At the same time, silver turnover on the Shanghai Gold Exchange, China’s main precious metals trading hub spiked, rising 2,837 per cent from the start of this year to a peak of 70m ounces on April 26, according to exchange data.

The number of contracts outstanding, an indicator of investor exposure, doubled over the same period.

Silver trading in Shanghai remains below the levels in London and New York, the two main global hubs, but its rapid growth means its has become increasingly significant in driving prices.  “I’m pretty certain it’s the Chinese retail [investment] that is driving this move,” one senior precious metals banker said. “There’s an enormous amount of speculation going on out there, they’ve got the bit between their teeth.”

The Chinese gorilla

Looking at the reports of the market and commodities, it is plain that the Chinese Government is an interested player in gold acquisition – something that 2ndlook projected nearly 4 years ago. And the Chinese consumer is behind the rise in silver prices.

Since China is anyway the world’s largest producer of gold, disruption in gold supplies has not highly marked. If other Governments follow the Chinese example, gold prices could explode. If Chinese buying gets very aggressive, again, prices could spike.

The only cloud on the horizon could be some kind of consensus to bring some undeclared quantities of gold into the market – like the Central Banks Gold Agreement (CBGA). Is that likely? The only such seller could be EU members? With the Euro-zone and the Euro-currency itself in such trouble,  would ECB members dare to sell gold?

Especially, if the Chinese Government is ready to buy?

Top national central bank gold holdings. (Image courtesy - FT.com.). Click for larger copy.

Top national central bank gold holdings. (Image courtesy - FT.com.). Click for larger copy.

Of Mice and Men – 2015 Gold Outlook

USA, EU traderelationships with oil producers. The European hands-on, micro-management issue of trade balance seems to be delivering? Some may question, what it is delivering, though.

USA, EU trade relationships with oil producers. The European hands-on, micro-management issue of trade balance seems to be delivering? Some may question, what it is delivering, though.

Of mice and men

While the US dollar is weakening, by design, Greece, Ireland, Portugal and Spain are being bankrupted by a deliberately overvalued Euro.

In such a scenario, China believes that it has a winning hand. Even though, the Chinese exports juggernaut has been slowed by a yuan, trading at 17 year-highs. March 2011 reports indicate

an unexpected $7.3 billion trade deficit, the biggest in seven years. The nation’s (China’s) exports rose at the slowest pace since November 2009.

The US is betting that a weak dollar will reignite economic growth – much like what happened after the Japanese Yen strengthened due to Plaza Accord (1985).

For Europe, the grand prix is to replace the dollar as the currency of international trade – especially oil trade. Euro as a international trade-currency-of-choice, will give the Euro region access to more than 1 trillion euros in zero-cost floating balances.

China is expecting the yuan to play a similar role. Such are plans made by mice and men.

Monsieur Murphy says

What can go wrong with these plans? Plenty.

The eternal enemy of currency manipulation – gold. As a million bureaucrats work on the mechanics of their plans,

Increasingly, everyone is a victim - except the powerful 0.5% elite that rules the world. Break their power. Buy gold. (Cartoonist - Ted Rall; courtesy - http://charlesgoyette.com). Click for larger image.

Increasingly, everyone is a victim - except the powerful 0.5% elite that rules the world. Break their power. Buy gold. (Cartoonist - Ted Rall; courtesy - http://charlesgoyette.com). Click for larger image.

Sales of gold coins are on track for the best month in a year amid the worst commodities rout since 2008, a sign that bullion’s longest bull market in nine decades has further to run, if history is a guide.

The U.S. Mint sold 85,000 ounces of American Eagle coins since May 1 as the Standard & Poor’s GSCI Index of 24 raw materials fell 9.9 percent. The last time sales reached that level, bullion rose 21 percent in the next year. Gold will advance 17 percent to a record $1,750 an ounce by Dec. 31 and keep gaining in 2012, the median estimate in a Bloomberg survey of 31 analysts, traders and investors shows.

UBS AG, Switzerland’s biggest bank, had its second-best day this year for physical sales on May 9, according to a report the following day. The bank’s sales to India, the world’s top bullion consumer, are more than 10 percent higher than in 2010. (via Gold Coins Show Bull Market Unbowed in Commodities Decline – Bloomberg).

You take free advice …?

While George Soros talks of gold being the ultimate bubble, his companies are quietly buying gold.

Back in late January, as the world’s important people rubbed elbows in Davos, billionaire investor George Soros had some rather definitive thoughts to offer on gold, which he called “the ultimate asset bubble,” according to reports.

However, he neglected to mention that his hedge fund had been buying.

Another report points out that the liquidation (by people like Soros) of investments in public investment vehicles may be replaced by private investments.

In this game of musical chairs, when the music stops, everyone who does not own gold is out. (Cartoon by David Horsey; Courtesy - http://politicalhumor.about.com). Click for larger image.

In this game of musical chairs, when the music stops, everyone who does not own gold is out. (Cartoon by David Horsey; Courtesy - http://politicalhumor.about.com). Click for larger image.

The new filings from funds “may show that big names exited ETPs and this news may cause prices to slip in the very short term,” said Bayram Dincer, an analyst at LGT Capital Management in Pfaeffikon, Switzerland. Some funds switched to holding gold directly so they wouldn’t have to announce it publicly, he said.

Is gold a bubble?

A rather disbelieving journalist writes of the situation in the West

Gold is in a bubble. Anyone will tell you that. They’ve been saying it since gold was about, oh, $500 an ounce. But it’s a funny kind of a bubble. It’s the only one I’ve encountered where so few people seem to own the asset in question.

During the dot-com bubble, you met lots of people with tech stocks. Taxi drivers told you what dot-coms they owned. During the housing bubble you met normal, ordinary people who were trading up to expensive homes using adjustable-rate mortgages, buying new condos off plan to flip, and cashing out their fictional “equity” through a refinance mortgage.

But who actually owns gold? I keep hearing about the gold bubble, but every time I ask people if they own any themselves, they say, “no, no, of course not, it’s a bubble.”

Some bubble.

Central banks around the world are printing more dollars, euros, pounds and yen. Gold may simply be a less awful currency than all the others. Banks can’t print any more of it, so its price should probably rise while other currencies fall.

For this year, the question in India seems to be, “Will gold cross Rs.25000, by 2011 Diwali?”

The shadow of oil

Middle East Politics (from Coming apart, coming together By Edward R. Kantowicz; Page 165; courtesy - books.google.com). Click to go to source.

Middle East Politics (from Coming apart, coming together By Edward R. Kantowicz; Page 165; courtesy - books.google.com). Click to go to source.

Is the USA like Britain was a hundred years ago? (Caroon courtesy - mpg50.com.). Click for larger image.

Is Pax Americana like Britain was a hundred years ago? (Cartoon courtesy - mpg50.com.). Click for larger image.

Fat and lazy

Between 1875-1935, Britain was dependent on India for gunpowder, on USA and Iran for  oil, on Malaya and India for rubber. British economy had grown fat and uncompetitive – unlike Italian, German and Japanese economies.

Even though Britain won WWII, their economy was a lost cause. Though Germany, Italy and Japan were losers, with their economy in shambles, they could make a brilliant recovery and vastly out-compete Britain.

The story of Middle East oil is similar for USA and West. The Welfare State, built on a diet of cheap oil, easy dollars,  is now too expensive for the West to sustain. The above book extract gives an excellent snapshot of the oil industry in the 20th century.

And the shadow of oil on the 21st century.

Abbottabad does not quite add up

May 11, 2011 2 comments
The difference between 'civilized' West and 'barbaric' Islamic world. (Cartoon by John Cole; courtesy - caglecartoons.com). Click for original image.

The difference between 'civilized' West and 'barbaric' Islamic world. (Cartoon by John Cole; courtesy - caglecartoons.com). Click for original image.

Things go bump in the night

In the early hours of 2nd May, 2011, an obscure twitter-user started tweeting  about the US raid on Osama Bin Laden’s safe-house – 35 km from Islamabad, 200 miles south of the Afghanistan border, in Abbottabad. In a city, which houses Pakistan’s equivalent of Indian Military Academy.

But Pakistan’s police, para-military, military forces claimed ignorance, showed surprise, feigned outrage. Par for the course. Was it abject failure or a cover-up in Pakistan , by the powers-that-be?

US triumphalism is misplaced. But then Osama's death will surely get Obama many votes. (Cartoon courtesy - http://jeffreyhill.typepad.com). Click for larger image.

US triumphalism is misplaced. But then Osama's death will surely get Obama many votes. (Cartoon courtesy - http://jeffreyhill.typepad.com). Click for larger image.

Afraid of the mullah-madrasa-mujahid combine, predictably, Pakistan started denying any role in the killing of Osama Bin Laden. Truly Pakistan ‘doth protest too much, methinks’. Secret deal or not, in the past or post-facto, a deal around killing Osama could have been easily hammered out between Pakistan and USA.

It suited both the leaderships.

It is election time in USA

Pakistan was not alone in using Osama. Osama alive was source of US funds for Pakistan. Osama dead is an election ticket and a feel-good factor for the a USA being battered by the Great Recession. As Rajiv Dogra points out, on the opposite side of the world,

The timing suited Obama well. It had long been speculated that Osama would be killed around the time Obama’s re-election campaign kicked off.

Predictably, the US made a song-and-dance about the annual aid of US$3 billion that they dole out to Pakistan. Compared to the US$3 trillion that the US Department of Defence is unable to account for, this talk of US$3 billion makes for poor form.

Pakistan's soldiers patrolling the tribal area of Ditta Kheil in North Waziristan for militants and al-Qaida activists in March.| Photograph by Mohammad Iqbal/Associated Press | Picture courtesy nytimes.com /Click for original image.

Pakistan's soldiers patrolling the tribal area of Ditta Kheil in North Waziristan for militants and al-Qaida activists in March.| Photograph by Mohammad Iqbal/Associated Press | Picture courtesy nytimes.com /Click for original image.

On a lighter – and logical side

Famous for the song केम छे ‘kem che, kem che’ from the film जिस देश में गंगा रहता है Jis Desh Mein Ganga Rahta Hain, a Bollywood songwriter confidently predicted, soon after 9/11, that Bin Laden would be found near the White House or Islamabad!

Coming to India

Memories dimmed, history forgotten, India draws wrong conclusions from these Western adventures in our neighbourhood.

After WWII, as British, French and Dutch colonialists were being thrown out of Asia, in country after country, the West was in real danger of losing markets and raw material sources.

To make war palatable, Desert Bloc invented religion. (Image  source - loonpond.com; artist attribution not available at image  source)

To make war palatable, Desert Bloc invented religion. (Image source - http://loonpond.blogspot.com; artist attribution not available at image source).

A new power, fueled by a growing migrant population, USA, took the place of tired, old powers – Britain, France and the Dutch. Instead of the openly exploitative system of European powers directly running colonial governments in these Asian countries, the US installed an opaque system – which is equally exploitative. To impose its writ on the newly independent Asian countries, the US simply destroyed their  economies by war. The USA, then instituted the innovative USCAP Program and ‘helped’ these countries. These countries (Taiwan, Singapore, Japan, South Korea, Indonesia, Malaysia, et al) were now ruled by overtly independent regimes – but covertly, client states of the USA.

US multinationals and home-grown oligarchs (keiretsus, chaebols, etc.) took over the economy – and sidelined British, French and Dutch companies. To impose this economic model, US armies, using nearly 1 million troops, killed 50 lakh Asians. The takeover of European colonial possessions by the USA was handled over 3 regimes of Eisenhower-Kennedy-Johnson seamlessly.

Between a rampant USA, behind biggest terror spots of the world, and a nuclear-armed, imploding Pakistan, India’s choices are difficult – and reactive policies inadequate.

Once more, Osama’s death and Obama’s antics bring out India’s policy inadequacy in sharp relief.

How was Churchill different from Hitler …

October 30, 2010 3 comments

How was Churchill different from Hitler? A mercenary mass-media and a ‘captive’ academia distort the picture!

Churchill blamed Indians for the Gret Bengal Famine - After all, why did Indians have to breed like rabbits ...? he asked.

Churchill blamed Indians for the Great Bengal Famine - After all, why did Indians have to breed like rabbits ...? he asked. Click for larger image.

Decades of planning

Emerging nations (India is, hopefully, re-emerging), at some point, will confront militant and aggressive powers, who have used major massacres to secure their ends. Apart from well documented and known military massacres , there are equally effective massacres – the Bengal Famine of 1943 being a prime example.

Like much of Western history, the British (Lord Willingdon, Neville Chamberlain, Montagu Norman, Winston Churchill – as the Chancellor of the Exchequer) executed a scorched earth policy in India from 1920-1945 – culminating in the The Great Bengal Famine.

After all what is a brown life worth?

A propaganda victory

Some three million Indians died in the famine of 1943. The majority of the deaths were in Bengal. In a shocking new book, Churchill’s Secret War, journalist Madhusree Mukherjee blames Mr Churchill’s policies for being largely responsible for one of the worst famines in India’s history. It is a gripping and scholarly investigation into what must count as one of the most shameful chapters in the history of the Empire.

The scarcity, Mukherjee writes, was caused by large-scale exports of food from India for use in the war theatres and consumption in Britain – India exported more than 70,000 tonnes of rice between January and July 1943, even as the famine set in. This would have kept nearly 400,000 people alive for a full year. Mr Churchill turned down fervent pleas to export food to India citing a shortage of ships – this when shiploads of Australian wheat, for example, would pass by India to be stored for future consumption in Europe. As imports dropped, prices shot up and hoarders made a killing. Mr Churchill also pushed a scorched earth policy – which went by the sinister name of Denial Policy – in coastal Bengal where the colonisers feared the Japanese would land. So authorities removed boats (the lifeline of the region) and the police destroyed and seized rice stocks. (via How Churchill ‘starved’ India.).

Pictures of the hungry and dying in Bengal during the famine.

Pictures of the hungry and dying in Bengal during the famine. Click for larger image.

Systematic Britons

They implemented a series of economic and administrative measures that killed millions in the Bengal Famine, would impoverish India – and sustain the empire. Between 1920-1945, the British manipulated exchange rates and trade to impoverish the Indians. Food grain prices rose sharply on supply disruptions during WW2. Indians had no financial reserves. 40 lakhs Indians died in the resultant Bengal Famine.

Savage response

After the fall of Singapore, and the rapid Japanese advance, with Subhash Chandra Bose in the vicinity, a revolt by Bengal would have had catastrophic effect on the colonial administration. Howard Fast, in his novel ‘The Pledge’ speculated that the Bengal Famine was a deliberate creation – possibly to weaken the local population. Subsequent research has confirmed that this ‘theory’ of  deliberate famine.

No bodies ... no famine ... What famine ... ? The British efficiently disposed of the bodies in Kolktta. (Picture by life.com; courtesy - oldindianphotos.blogspot.com.).

No bodies ... no famine ... What famine ... ? The British efficiently disposed of the bodies in Kolktta. (Picture by life.com; courtesy - oldindianphotos.blogspot.com.). Click for larger image

Caught in a pincer movement, between Subhash Bose’s trained and armed soldiers and Gandhiji’s unarmed force, the British Raj responded savagely. With massive additions to the Indian police force.

The British were better …

Under dubious licences and restrictions, the British Raj turned Bengal into a huge concentration camp. Like the Spanish had done in Cuba, nearly 80 years ago. General Valeriano Weyler, “The Butcher,” was sent from Spain to stamp out the independence movement in Cuba. He created modern history’s first concentration camps. Hundreds of thousands of men women and children were put into concentration camps. In Havana city alone, 52,000 people died.

Afraid that Bengal would fall to Subhash Bose, Burma’s rice crop was barricaded from Bengal. To cut Bengal from Burmese rice, Indian traders in Burma were hounded out. Grain trucks were not allowed to move into Bengal. Without Burmese rice, on which Bengal depended, an estimated 40-50 lakh people in Bengal died.

All that was left of Indians - Skin and bones. Why did Indians have to breed like rabbits? asked Churchill. (Picture by life.com; courtesy - oldindianphotos.blogspot.com.). Click for larger image

All that was left of Indians - Skin and bones. Why did Indians have to breed like rabbits? asked Churchill. (Picture by life.com; courtesy - oldindianphotos.blogspot.com.). Click for larger image

The Bengal Burma link of the ages was broken. Chettiar money lenders were thrown out of Burma. From being a granary of Asia, Burma started declining – and there was no rice for exports. Result – The Bengal Famine of 1943. Tally – 40-50 lakh deaths. As Gideon Polya has pointed out, Australian sheep have lower mortality rates.

Dignity of death

In his study (Poverty and Famines: An Essay on Entitlement and Deprivation By Amartya Sen) about The Great Bengal Famine, Amartya Sen highlights that “…for every dead woman there were nearly two dead men …” Sir Charles Elliot Famine Commissioner in Mysore in 1876 the general belief about Indian famines that “all authorities seem agreed that women succumb to famine less easily than men.”

The end of extraction

After WW2, Churchill very much wanted the option of squeezing the Brown man at least a little more. Whatever little there was left of the Brown man after the Great Bengal Famine of 1943.

A womans collects fallen grains of food from the road. (Picture by life.com; courtesy - oldindianphotos.blogspot.com.). Click for larger image

A womans collects fallen grains of food from the road. (Picture by life.com; courtesy - oldindianphotos.blogspot.com.). Click for larger image

Clement Attlee pointed out that there was nothing left to squeeze. Attlee thought that the cost of squeezing was greater than the value of the extract. After Montagu Norman, Churchill, Lord Willingdon, Neville Chamberlain had finished with the Great Bullion Scam against India from 1925-1945. After the war was over and the Brown man was used in Africa and Europe. They let us go – and allowed us to rule ourselves.

How can we ever repay this debt?

Hitler was never alone

Hitler’s biggest mistake – he lost the war.

The genocide with which his regime was charged with was also carried out against the Native Americans in the USA, the Australian aborigines, in Congo by the Belgians.

Post colonial Governments in Kenya and India have ignored the cover-up of the millions killed by the colonial rulers – in the Mau Mau operations in Kenya or the 1857 War in India.

Bodies were disposed as efficiently as food was denied in Bengal. ((Picture by life.com; courtesy - oldindianphotos.blogspot.com.). Click for larger image.

Bodies were disposed as efficiently as food was denied in Bengal. ((Picture by life.com; courtesy - oldindianphotos.blogspot.com.). Click for larger image.

While Hitler killed millions (some 5-6 millions) in his concentration camps, Britain killed a similar number in  Bengal. Britain wreaked havoc in India by creating The Great Bengal Famine. Some 40-50 lakh Indians died. Hitler rained the Holocaust on the Jews. Some 50-60 lakh Jews died.

Same difference.

What’s the difference

How were German concentration camps different from Bengal-as-a-concentration camp? There was one significant difference.

The British were kind enough not to use Zyklon gas – which would have killed Indians faster. Instead Indians died, slow, horrible deaths, over a period of 2 years. Unlike Jews, who were killed quickly.  The British were without doubt the more humane murderers – compared to the Germans.


End of the Asian premium on oil?

Citibank has been saved 3 times in 30 years!

Citibank has been saved 3 times in 30 years!

Resource-scarce economies, such as China, India, Japan and South Korea, have long been heavily dependent on oil from the Middle East, giving producers there the upper hand in pricing. The surcharge, known as the “Asian premium,” has averaged about $1.20 a barrel since 1988.

Now, the tables are turning, handing an advantage to the region’s fast-growing countries in the form of relatively less expensive energy.

In March, Saudi Arabia, the world’s largest oil exporter, sold its Arab Light crude to Asia for $6.37 less per barrel than it charged European buyers … Kuwait and Iraq also followed suit … though official statistics aren’t yet available.

The latest flip in prices has led many analysts to conclude that fundamental changes in the global oil trade will soon eliminate the Asian premium for good, eliminating a drag on the region’s economy. In 2008, for example, Asian customers bought about 14 million barrels of oil a day from the Middle East, according to BP Statistical Review of World Energy. The premium averaged $8.08 a barrel that year, amounting to about $41 billion. (via Economic Clout Earns Asia an Oil Discount – WSJ.com).

Economic miracles

Going down the drain!

Going down the drain!

One by one, each Asian country has been able to pull itself out colonial cess-pit that seemed bottomless at one point of time. Barring a few like Pakistan, Bangladesh, Afghanistan, some Central Asian republics, Asia is truly on its way out of the 20th century misery.

There are two economic miracles. One we have seen.

It is a miracle that Asia has been able to come out of its poverty pit, where it found itself in the 20th century – especially after WW2.

The greater miracle will be when Europe and Middle East find a way to rebuild their economic model – without the Asian premium!

And that is the miracle we may not see!

The building of the Churchill Myth

Winston Churchill - (courtesy - telegraph.co.uk)

Winston Churchill - (courtesy - telegraph.co.uk)

The three crucial broadcasts were made not by Churchill but by an actor hired to impersonate him. Norman Shelley, who played Winnie-the-Pooh for the BBC’s Children’s Hour, ventriloquized Churchill for history and fooled millions of listeners. Perhaps Churchill was too much incapacitated by drink to deliver the speeches himself. (via The New York Times > Books > First Chapters > First Chapter: ‘Love, Poverty, and War’).

Propagnda masters

To use an actor to deliver a speech, in the middle of WW2. To fool the British public itself, calls for a certain brazenness.

Whatever one may fault the British for, at propaganda they are the best. To drown facts under a tidal wave of falsities, shows British mastery over the ‘science’ of propaganda. I am sure that propaganda is what Indian ancients referred to as  माया maya. There are some other gems also in this post – about British propaganda, which persist even today. Worth a read!

Why am I not surprised by British acknowledgment of Goebbels as a ‘better at propaganda.’

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