Market is like Nature

Being politically aware definitely has its perks. One is politically vigilant and is quick to provide insights on news that "ordinary" people ignore as just another news. Unless its a tax increase, or an interest waiver or worse, a terror attack, people usually pass ignorant, generic, narrow minded comments on political happenings. A politically aware person sees a different view. Bailing out GM or AIG. Whats your view on it? If I get responses on it, I will flaunt my political awareness :). And political awareness has its disadvantages as well. Your blog may get blocked at work. Cool ain't it? You join the ranks of Al Qaeda, LTTE, LeT, and even porn sites!. Talking about being IN the league. Coming to the point, after being in the US for almost two years, I have come to realize my political stance with respect to American politics. I am a Republican :). Republicans or conservatives are people who believe in the founding principles of this country. Which is free market, entrepreneurship, limited Government and individual efforts. To me that is very liberal. Democrats on the other hand, termed as Liberals (Ironical) are ones who believe in... forget it. They believe in everything. They are leftists, centrists, what not. Even gays. Because? knock knock! They are liberals! They can be anything.

My political stance is inspired by the founding principles of America on its market. When a company fails, or when the market collectively fails, it is because of a bad business model. And its up to the market which should rise and sustain on its own to support its very existence. Very much like nature. If a chameleon that is black in skin color in a rain forest, 9 out of 10 times its going to fall prey. What does it do? Its species adapts itself to its surroundings and eventually a new kind of chameleon species is formed that can now change color. Camouflage to protect itself. A free market is like nature. It changes, adapts and reinvents itself. Tomorrow if Bank of America fails. Sure a few people lose jobs. Next door Daniel who is super talented loses his job. Its not his fault that Bank of America had a bad business model in lending sub prime mortgages. BUT! The market has a demand. That regardless of BofA's existence is big enough. This demand will pave way for a better, faster growing organization booming in confidence that can absorb talented people like Daniel. In fact such an event will redefine business models around to be forced to be better and more efficient. Surely if A and B have an ice cream shop and if B has more cleaner, friendlier shop than A, A cannot afford to be lackluster. A will reinvent itself.

In a socialist economy, the opposite happens. The govt bails out failed, sick enterprises. Air India is a sick enterprise forever on loss. Its shoddy, inefficient model is the reason for the rise of better, more efficient and swankier airline companies in India. If Air India is no more subsidized, sure Air India will fail. People will lose jobs. But the better of the airline companies will absorb market talent paving way for a better, faster market. And by the way, if Air India is subsidized keeping the lazy babus still in their jobs, sure it looks good in terms of providing job security. But whose money is it? OURS. We keep these lazy babus in their jobs only to provide us with shoddy service. Same holds for the thousands of sick steel units, power units around the country.

Therefore free market economy is the way to nurture more talent. Limited govt meaning lesser taxes. If you invest 25% of the taxes that you pay on a sound scheme, you will be a rich (hell yeah, rich) by the time you retire. And this is at a conservative number of 10% per annum. This is my 0.02$ worth opinion on market. And just to complete, market is linked to politics. And to reemphasize my point of self adapting and self bettering systems, I would allow you to figure out how politics and markets are linked.