Jayant Bhandari, who MBA from Manchester Business School (UK) and B. Engineering from SGSITS (India), believes we are now coming to realize how excessively governments control our lives. “Without legislative approvals or court processes, the executive in many countries have been able to put billions of people under house arrest, shut businesses, stop children from playing, and stop the movement of people,” he said.
Bhandari has kept a tabs on the virus in India. He notes that on March 24, 2020, the Prime Minister, Narendra Modi, came on the TV and announced a complete curfew all across the country of 1,380 million people. “All flights, road transportation, and trains––after continually running for 167 years––came to a full, shrieking, complete halt,” he said. “100s of millions of people got stuck, without food and money, wherever they were.”
There was no way for them to get back home or travel for any emergency. “Those who dared to sneak out to go to the hospital or to buy groceries were ruthlessly beaten up by the police,” he said. “This wasn’t a lockdown, but a real curfew.”
Bhandari transports us to India and paints a picture. “Anything up to 100 million migrant workers, who earn $3 or so a day, were no longer employed, and have no social security,” he said. “These people live from hand to mouth. Living in slums, they share a single room with a lot of other people, often sharing the same bed. They suddenly found themselves penniless and foodless.”
And then, millions of the migrant workers soon walk as much as 1,500 km to their rural homes. “Hundreds get killed in the oppressive heat. Scores, perhaps hundreds, of women gave birth to children while walking and then continued walking. They took brutality by the police in its stride.”
Indian GDP is $2,350 per capita per year. “When a rich country like the US has been so hesitant to lockdown everything, India went for a full curfew for everyone,” he said. “Depending on which statistics you look at, between 300 million to 1,000 million Indians go to bed hungry on a typical day. These people were sent to starvation by the curfew. “
This curfew has all the makings of the worst humanitarian disaster of this century, says Bhandari. I have asked myself if Modi wants to be the next Mao. Here is the irony of the ironies. Despite running a curfew for two months, much longer than what China took to clean up everything, with a far less atrocious lockdown, Indian covid19 cases are increasing exponentially.” The Indian government is braindead and utterly incompetent, he says.
“I am so pleased with myself that when I could, I emigrated,” Bhandari said. “The Indian economy was stagnating before the curfew was imposed, but now the government has destroyed it, because of their simplistic, rather idiotic thinking.”
He believes the philosophy of Darwin and Malthus are wide-awake and increasingly active in India. “I won’t be surprised if tens of millions, perhaps 100s of million disappear in this god-forsaken country,” he said. “This won’t happen because of covid19, but because India is so chaotic, mismanaged, and forever dependent on the West.
He finds solace in the fact that, across the spectrum of political beliefs, Americans, Australians, and Canadians have resisted draconian, Machiavellian controls of their governments. “Despite having dimmed, Liberty survives in the US and some other parts of the West,” he said. “While societies and politics of East Asia—Japan, Korea, Taiwan, Hong Kong, and Singapore—are not necessarily rooted in the philosophy of Liberty, their governments are also not dominated by welfare-statists.” They have been very measured in their responses to covid19, and are among the most capitalist countries on the planet, he says.
Bhandari has come to have increased respect for US President Donald Trump, as well as Singaporean Prime Minister, Lee Hsien Loong. “Both of them have been the most statesman-like in how they have shown their dislike for the lockdown,” he said, mentioning the speeches given by Mr. Lee on his YouTube channel.
Bhandari believes China, based on what we know so far, overreacted to covid19 and was at times heavy-handed. “But what stands to reason is that they were able to stop the spread once they decided to do so.” He is optimistic about their economy, as well as much of East Asia, which he calls the most capitalist countries in the world.
“No wonder, they have been the most measured in their response to Cod19,” said Bhandari, who runs a yearly philosophy seminar in Vancouver, Capitalism & Morality. “Capitalism gives the capability to do a cost-benefit analysis. What we today have in most of the world is over-centralization, where governments have excessive control over the citizens. At the same time, while they have an instinct for what the masses like to hear, the politicians are not, to put it mildly, very intelligent.” They are unable to do a cost-benefit analysis, he says.
The number of deaths because of only-covid19 has been minimal. “Most deaths have been of those with comorbidities,” said Bhandari. “A question that should have crossed the minds of the politicians, but didn’t, is: Is trying to delay deaths, by a few months, of 0.1% of the population, worth it compared to destroying the economy, making 10% to 30% of the labor force unemployed, and house-arresting everyone leading to depression and fights within the families?”
He says politicians have a herd-mentality, so they did what China started. “They have no lateral thinking or capability to do something different,” said Bhandari. He is reminded of Sweden, where the government decided not to enforce a lockdown.
“What we need is capitalism, where people can do a cost-benefit analysis and be accountable for their decisions. Our politicians have no such accountability,” he said. “Capitalism makes cost-benefit analysis possible. Capitalism is a funny word and stands juxtaposed with a nice-sounding one, socialism.”
He says capitalism merely means that people have the right to do any economic transaction without a need to be told by the government what it should be. “Socialism takes away your agency and makes you a slave by taking away what you produce,” he says. “The consequences are far-reaching, not just economic. Capitalism leads to a moral, rational, self-reliant, happy society. Socialism leads to immorality, self-centredness, and degradation of social relationships.”
The harm to the economy that we will have done, all over the world, will be enormous. “We will eventually realize that the benefits of this self-inflicted economic damage weren’t worth the cost,” said Bhandari. “That said, most East Asian economies are already on track. So is the case with China. I am happy to be investing in their stock markets.”
He is also investing in commodity businesses. “Their valuations are easy to do when the future economic structure of society looks unknown,” he said. “For example, I no longer know what the balance sheets of banks or airlines will look like or what kind of business a clothes manufacturer will have. But commodity businesses are simpler to understand, given their inputs and outputs are known and traded internationally.”
He believes the stock market for the remainder of 2020 will be volatile. “As profitabilities of companies start to reflect the harm the lockdown will have caused, we should focus on what can generate returns.”
Property is not one of them. “The property market has now been going up for at least three decades everywhere in the world,” he said. “It is too expensive, offering minimal yields. Stock markets are expensive. This boom had to happen, for savers don’t have many choices. Cash is an increasingly depreciating asset given the negative real interest rate regime we have.”
While there are still some isolated companies, markets, and properties with a bright future, investing in them is not everyone’s cup of tea, he says. “In such a situation, anything that you can touch and assess the value of most efficiently and with the least uncertainty will be one of the ways to protect your savings. Everyone should look at precious metals for some protection.”