EP 217 | Daily Global Insights | Aug 4, 2021 | Global News | US News | India News | Markets

Sree Iyer: Namaskar, today is August, 4th, Wednesday, and welcome to daily Global Insights Sri and Sree. This is episode number 217. In Global News, Taliban emboldened by its battlefield success in Afghanistan, the US envoy says. Today, there have been reports of firing in Kabul, so this is a very highly changing fluid situation. Your thoughts, Sridharji, as we kick off today’s DGI.

Sridhar Chityala:  Good morning to everybody on this wonderful Wednesday morning. I think we are fast looking at a situation where Afghanistan is probably slipping into a potential Civil War. The Afghan forces have not been able to combat the resurgent Taliban and they’re making their way well into various parts and including right around Kabul. Ashraf Ghani, the President as well as Mr Hamid Karzai, the past President have indicated that USS probably left a bit too early by which they’re saying that they have not prepared the situation for the Afghan forces to combat. A date was set and have moved on and you can see the Taliban, very quickly, making its headway into Afghanistan.

Sree Iyer: Chinese paramilitary train Cuban Security forces are responsible for suppressing, protesters. Hong Kong pro-democracy, protesters sentenced to nine years in prison for violating China imposed National Security Law. China orders Mass testing in Wuhan as the Covid outbreak spreads. Sir, China is occupying 80% of our news.

Sridhar Chityala:  Well, I think China is very, very critical because China is not occupying  80% of the news. China is the hundred per cent of the news around the world. It doesn’t matter whether it is East, West, North or South; you find that the China question has become the single biggest question around three fronts. One is the pandemic, which has engulfed the world and there is still no consensus in the world to address and appoint the blame and figure out as to what exactly is the truth and how exactly your deal with this situation. Everybody is holding back their data and we are groping in the dark, this is the first.

The second is that there are continued skirmishes and threats to the sovereignty of various Nations doesn’t matter whether it is a Himalayan region doesn’t matter whether it’s the Mediterranean, doesn’t matter whether it is the South China Sea, doesn’t matter whether it’s the Indian Ocean, doesn’t matter, whether it’s Pacific, this is the second which is the sovereignty and Boundary threats.

The third I think is they are provocative behaviour around trade, tariffs and some of the things that they’re doing to their own companies. You know, for example, you are seeing, great recalibration of the Chinese Industries which are listed notably in the United States and other parts of the world and being brought under regulation, which is causing havoc in terms of the market cap both for the investors, outside of China as well as inside China. So, naturally, you are beginning to see China, being the front centre. In this specific instance, it’s not surprising that you have the Cuban forces being trained, very similar to the way they dealt with Hong Kong and internally, which is brute force, in terms of putting any kind of Oppression. Now, you are seeing that they are teaching a lesson to the Hong Kong people, which is to say, you are a pro-democracy, you are going to miss the prime part of your life.  We will put you behind bars for 10 years because you have violated the National Security Law, which means you have no right, no will to descent.

Then, as far as the Wuhan, it seems to have gone back straight into their path and they’re facing the consequences in their own country.

Sree Iyer: Tanker seized by suspected Iranian forces in the Arabian Sea is identified as Panama flagged Asphalt princess. As far as my memory goes most ships are registered in Panama for tax reasons, aren’t they?

Sridhar Chityala:  They are but this is a Panamanian ship, which is flagged that the specific details will probably know more tomorrow. But again, you know, making its way probably from, one of the British Port, but Iran itself has raised alarm to say, don’t annoy me blame on me. This could be some kind of a piracy attempt or hijack attempt, but it’s not the Iranian state involved. But, the fact is just off the Strait of Hormuz on the cusp of the Arabian Sea, you find that this has this incident has occurred, this comes close to the heels of the Drone attack on the Mercer Street, Merchants carrier, which resulted in two deaths. Again, that’s another country that is in the front centre and back of the news that’s Iran.

Sree Iyer: Japan confirms with ASEAN the importance of free navigation, in the South China Sea and five-point formula for resolving the Myanmar issue. We talked about how the temporary General has declared himself as Prime Minister yesterday. So, now Japan and the ASEAN are trying to see if they can bring about some kind of rapprochement between the opposition and the ruling Junta isn’t it sir?

Sridhar Chityala:  It is, it is, it is one thing which is very good is that there is a dialogue that is going on in and around ASEAN which again is the epicentre of the pandemic, the epicentre of geographic issues, epicentre of this political tensions by some renegade regimes such as the Junta in Myanmar. So it’s good that they are meeting and they’re re-declaring the necessary for an open and free South China Sea. But we mentioned that Thailand, Indonesia Malaysia have taken the lead and saying, we don’t need external influence that ASEAN countries can work with the Junta and try and find a solution. So they are trying to come up with, which is to say, okay, you know, be transparent, set election date, don’t be regressive with the protesters, you know, come up with a formula whereby, there is a normal transition into conducting free and fair elections and re-establishment of democracy in the ASEAN nation.

Sree Iyer: The United States has given 110 million vaccine doses to 60 countries says the White House spokesperson. Vaccine passport battles continue in Germany, France and other European nations. If you don’t have a passport, then the freedom of movement becomes very heavily restricted, isn’t it?

Sridhar Chityala:  The question of what is a passport and what exactly is the content that is prevalent and how exactly the central database is going to be monitored and maintained and managed is the central question that is bothering many people. It’s not the question of giving people evidence or just like, you know if you have a driver’s license, a driver’s license is registered and lots of data is tracked around that, so it’s very similar. You have in vaccine passport if you’re going to create something and you are going to navigate, nobody is trusting. Because first and foremost, these vaccines itself is not proven, it’s only released in a tested mode and under the circumstances, you are collecting all the central data and navigating that seems to be the central issue. They are basically, saying the right of choice is mine just like Insurance, the right of insurance is mine not by anybody else. So I think this is where the protests are coming. Don’t come and impose and tell me what you want to do. When you want me to show some evidence I’ll show some evidence. Just as you know you board a plane, you have your PCR test conducted which is namely to say that you have proof of vaccine record and proof of no positiveness for Covid test, so, therefore your negative. So you can produce some evidence other than having a passport, this is the central issue, sir.

Sree Iyer: The United States news, Buried in the “Infrastructure, Investment and Jobs Act”, in the US Senate is approval for the Department of Transportation who secretary is Pete. Buttigieg, who was one of the presidential candidates to the Democrats, to test a new federal tax on every mile driven by individual Americans. A little bit more context Sridharji because people will send troves and troves of comments about how, you know, we are only, showing one side of the story, a little bit more context on this, sir.

Sridhar Chityala:  Well, you know, I’m sorry if this sounds sarcastic to everybody, you know, in the United States, you breathe, you pay taxes, you don’t breathe, you pay tax and you don’t breathe and then you are burying, you still come and vote. So therefore you can do anything and everything right under the sun that is my sarcastic comment. But, to make this point that is buried under this infrastructure bill. There’s a specific clause which says to the Transportation secretary who is Mr Buttigieg, test in a sample, you know if somebody has driven a hundred miles whether you can clock and tax him. Hey, you know, you have driven a hundred miles away everyone. So you pay a tax. So this way they say, they can also service the national highways. So on one side, you are creating a National infrastructure bill which is a 1.2 trillion-dollar stimulus, you’re going to fund it by collecting taxes. Now, you’re experimenting another way. Not only do you collect taxes from the individual but if he drives a hundred miles, he has to pay or he drives five miles, he accordingly pays tax. So this is experimentation, it is not yet established as a mechanism to collect taxes. They have asked the transportation secretary to conduct this. There’s another, if I were to give another sarcastic, comment, Mr Manchin, you know who is one of the swing members in the Senate here, his wife, Gayle Manchin has been given 1 billion dollars, 200 million over five years, to develop her department, which is the Appalachian region of about thirteen states where, , she will diverge that money for economic development. So you have all these kinds of hidden things when you have these gigantic numbers and that’s all coming out as people do the parsing. By the way for the purpose of those who think this is a retarding comment, we will share the link so you can see for yourself this specific clause in the infrastructure bill which apparently is running to 2200 plus pages.

Sree Iyer: Four officers have died by suicide after the US Capitol attack. Officer dead after a burst of violence outside Pentagon, this was yesterday, not many details on that. Sridharji, these four officers committing, suicide is very worrisome, sir.

Sridhar Chityala:  It is very worrisome. The one reported yesterday, again, we all share, which is to say the four officers have committed suicide initially to two, followed by two more. We can share the names as well because the names are published, but no reason is mentioned. No reason is given other than to say, for unspecified reasons, these four officers have committed suicide, the cause is unknown and reason unknown. While strangely it was for officers again, who have depots on the day, one of the commission. So, therefore, it’s interesting as to what is going on with that.

With regard to the Pentagon incident, a Pentagon official, who was standing to board a bus on a bus platform, get stabbed. And there is a Meli, there’s a shooting, both the suspect as well as this person has succumbed to the injury. I think that the gunshots of whatever is the is the cause of the death. The suspect has been identified, and he has been named and that’s it. There is no further news. What it reflects is if this is happening right in some of the critical buildings and offices in DC and you have a government in place in DC and you go on blaming Trump for anything and everything that is happening. It’s a very sad reflection of how the situation is being managed out of DC.

Sree Iyer: It gets better, New York Governor Andrew Cuomo, sexually harassed multiple women, investigation finds. The President of the United States Joe Biden has called on Cuomo to resign after the bombshell sexual harassment report. Till now, he has not resigned. Sir, your thoughts, is he going to go or he will have to be pushed out?

Sridhar Chityala:  Right now, he is stubbornly reminding defiant. He basically says I’ve committed no crime. By the way, this is the New York Attorney General, who is a Democrat who has conducted the investigation four governors of Democratic states have asked him to resign. The president of the country, who’s also a Democrat who had initially supported

Andrew Cuomo has asked him to resign, Nancy Pelosi has asked him to resign. He stays. This very much reminds me of what happened in Bill Clinton’s case, he remained defiant, until it was proven beyond doubt, what happened but he could have saved all of those things by going a different path. We are seeing something similar being played out in the Andrew Cuomo case.

Sree Iyer: Lawmakers say Chinese investment in the US farmland poses a security threat. Well, the Chinese have invested significantly in the United States over the past 20-25 years. In fact, I have said this thing in many episodes that you know, there was a time when Chinese investors used to come with suitcases full of cash to buy your property. What’s this shouldn’t come as anything new, having bought up office space and the built-up area in the cities perhaps now they are buying a Farm Land sir.

Sridhar Chityala:  And they probably were buying Farm Land all the time because as you all know that China has a significant shortage of food and it needs to import more than 50% of the food. They bought pretty much anything and everything they could lay their hands on in New Zealand on dairy farms. So, most of the dairy is actually now imported from New Zealand or it is coming from their own sources. So I think this is something similar that is being attempted in the United States. So the question that poses is that if they owned the farms, will the United States people be deprived and the food will be leaving the country because they all these particular agro farms, that’s the question. Whether there are two more investigations that are getting in one is as we speak one is, they’re looking at the educational institutions and what kind of aid and grant is being given. And I think the third one that they are looking at, you know, is the behaviour of some of the listed companies in the US stock exchanges. So, therefore you are now beginning to see more of these things being put on the table, but most of it is coming from GOP. Not much support from the Democrats as yet.

Sree Iyer: Dominion voting systems and Maricopa County rejects subpoena in Arizona election audit. Sir, how can somebody reject a subpoena? You’re supposed to comply otherwise you are in contempt of court.

Sridhar Chityala: It’s very interesting because you have this conflict between the legislative branch and the judicial branch. So, it’s being played out in the state courts and if again, the judgment should turn one way or the other way depending on who is the appointee of judge of the Local Court or the High Court, whether it is a Democratic or a Republican. Depending on which way it goes, it goes to the Supreme Court and eventually it’ll find its way. What’s the overarching message? There’s a problem in Arizona, there’s a problem in Pennsylvania. There’s a problem in Georgia. The problem is going to slip very soon to Wisconsin and maybe Michigan too. So, therefore, the election issue is not over and it will probably make its way.

Sree Iyer: Twitter partners with Associated Press and Reuters to combat misinformation. Fox to guard the henhouse.

Sridhar Chityala: I think that it says, they have the right. So they are sir public company as we call it here in the United States. They are public companies so they can choose to do what they want to do. At least, they’ve been very transparent, which is to say we partner with AP, we partner with Reuters. If it meets the threshold of Reuters editorial guidelines, meets the guidelines of AP whether they’re left, right, or centre, they meet. They are an established publication. So at least, I am satisfied but everybody knows openly which way Twitter is going.

Sree Iyer: Let’s take a look at India related news now. India and foreign Ministers of ASEAN meet on Wednesday, virtually. Brunei as a chair will be the host. Asia Summit meeting will also be held on Wednesday. India and seven other nations with 10 other ASEAN nations will be attending. The US has invited India for the Mekong ministerial meeting along with the United Kingdom. Five Mekong river countries, Thailand, Myanmar, Cambodia, Laos, and Vietnam and partners and global institutions will be attending this meeting. Sir, your thoughts. There are lots of meetings, lots of activity going on. The MEA should be wishing that he could clone himself.

Sridhar Chityala: I think, it’s firstly fascinating that as I mentioned to you, you had the ASEAN foreign ministers with Japan. Now we have the ASEAN foreign ministers with East Asia Sumit with Seven Nations that includes US, UK, France, India, including China, having a regional foreign ministers meet to discuss wide-ranging issues. The United States is going to host this Mekong River. By the way, we were one of the first people who conducted a Fireside session exclusively on the Mekong River challenges, the upstream dams that have drained water supply to the river systems. We have even shared the photographs. Thailand was one of the first countries to raise a big red flag which is to say that Thailand is reliant on farming and these dams in the upstream Himalayan ranges or in the Mekong River system is creating a huge problem s. So now they have established a Mekong Valley meeting that actually is going to have not only these five countries, ASEAN but will also have Korea and Australia as part of it with institutions such as the World Bank. Why? To point out that if there is a famine and shortage, it is not caused by some climate accord. It is caused by man-made disasters.

Sree Iyer: Viewers, one small request. As soon as you start listening to this program when you come online can you please click on the like button or share button if you happen to be watching it on Facebook and retweet and like if you are on Twitter? This helps us spread the message faster. We feel that we are days ahead of the normal cycle of news, and yet somehow our numbers don’t justify the fact that we are the tip of the spear. Thank you very much.

664 ceasefire violations, this year in Jammu & Kashmir by Pakistan, per the ministry of Home Affairs. Pakistan needs to vacate PoK, says the Indian Envoy to the UN Tirumurti. Is this the first time that India is openly calling out this thing, sir?

Sridhar Chityala: You are right. I think this is the first time I have heard in the United Nations session, where India will be the chairperson for the month of August. India is a permanent member for two years. But as long as they have the chairmanship, they fired the salvo, which is to say vacate PoK. That is not doesn’t belong to you. So we can commence the restoration and peace in the region. So I think that’s a great statement and before I ignore the prior news item, though it was featured in the Indian section, it basically says India is again at the front and centre of diplomacy around the entire ASEAN and Indo-Pacific and broadly the Asian region which is very great news from a diplomatic positioning point of view that India is the considered. Now, Blinken asking India to attend is another very telling indication as to what has happened during Mr Blinken’s visit to India.

Sree Iyer: India has no plans to cut import duties after Tesla appeals to slash taxes. Free grain scheme costing 2 lakh crores help reduce hunger says the Prime Minister.  Let us take a look at these two because I have something to add about the Tesla thing. You go ahead.

Sridhar Chityala: On the Tesla side, I think Make in India seems to be the overarching force. They are not prepared to give the concessions. I don’t have the full details but they’re saying comply with the rules or become part of the overarching scheme. I just don’t believe Tesla will wait and watch and see how the markets develop. They have similar problems in China, but they began to normalize. So I expect something similar.

As far as the food is concerned, as you probably know, during the pandemic over 800 million people have been given access to free food and that has now been extended till November. So, the point that Modi is making is that we have provisions and funds in the balance sheet, this is how we have dealt with the pandemic.

Sree Iyer: Excellent gesture sir, excellent. I cannot describe in words the kind of thing that the Modi government did to the economically oppressed and those who are driven out of their city dwellings back to their villages. This is one of the biggest to at least alleviate hunger.

Sir, on the Tesla, here is what I have understood. One of the things that India requires is, for anybody to have a plant in India they need to have, I think 30% or 35% import substitution. Now, here’s the problem with an electric car. There are not that many parts that are moving around. The only thing that they can do as a substitute is a battery which runs the length and breadth of a Tesla. The problem is that India does not have the wherewithal to manufacture batteries of that size. First of all, India doesn’t have the rare metal required, lithium-ion and so this is not so easy. It is not a practical solution. It is a difficult one. I think India should give an exception to Tesla because it is important to bring Tesla in so that the electric vehicle market becomes mainstream. Some people have paid an exorbitant amount of customs duties just to get a Tesla in India. There are two or three cars I believe. We’re a population of 1.4 billion, that’s laughable. We should have many more. But it’s just the fact that you have to work through so many duties plus I must also tell you when the car fails, it fails big. Very, very major problems. It’s a dead weight in the middle of the road if it fails for any reason. So those are the caveat. Sir, your thoughts on the API Imports, which have stood at 28,529 crores. The exports are at 32,000 crores. So that means India is now becoming slowly a net exporter, at least in the API. So, I think API is the Parma thing, right?

Sridhar Chityala: Yeah. API is part of the chemicals and fertilizers chemical. The component of the chemical is very specifically relevant to the farmer. The fact that India is the largest producer of vaccines is a reflection that it has many APIs as it relates to probably other vaccines that it domestically manufactures. The issues that are being looked at is, as relates to the covid-19 vaccines and I think once they begin to… Apparently, Covaxin, which is India manufactured is now indigenous. It was initially reliant on some key APIs being exported but that’s being resting addressed. The size of the market is quite astounding. It’s 96,000 crores, according to the minister as in 2019-20. So that again reflects that chemicals and is one of the biggest opportunities and markets in India.

Sree Iyer: A small observation. Thanks to many of you who have started liking this video webcast. Tomorrow, I want you to do this thing as soon as the transmission starts. That’s when the virality is decided. This is helping. We are seeing more viewers join. But it would really help if it is done right at the beginning of the show within the first minute. That will help us to get the message across. This is nothing out of the ordinary here. It is just a way to tell these algorithms that this show has a lot of content that is useful for the world.

So let’s take a look at Market, sir. Dow climbs more than 200 points, S&P 500 closes at a record. SEC asked Congress to help agencies take out regulatory grounds in crypto. Mainstream, now. It was going to be mainstream and because we also realized that this thing is a very important point we, in fact, are also going to give you an update on what is happening in the crypto market. So, in today’s video that I’m going to show where Sridharji can talk to it from the background. We’re going to also cover the crypto numbers. So here you go sir and putting up the video now.

Sridhar Chityala: Yes, thank you. We are covering 4 Market parameters. These are the 3 indices. We can add Russell also by the dollar index, the S&P index, and the NASDAQ. As you can see, the markets are at an all-time high. Dow climbed 278 points. The second index that we were showing is the energy, which is the Oil, Brent, and natural gas. You can see the Brent crude and the oil is now around the 70 – 72 mark, which can come down from 74, yesterday. Then, the third parameter that we will be showing Is that the bond markets. Yesterday, it was at a 1.1 rate. Today is 1.17. This is the 10-year US Bond reflecting that the bond market is held up. There is a new parameter which is Bitcoin. Bitcoin, which was less than 30,000, just about 2 – 3 days ago has now shot past 38,350. So the crypto is here. Now, the point around the SEC. Gary Gensler statement is that he saying we have to bring crypto mainstream. Crypto has to have regulatory oversight. And once that is done, then they perhaps may even allow EPFs on Cryptos to be permitted and traded in the exchanges. So. those who had apprehensions around the crypto, hold onto your seat belts and sit straight. I think it is shortly going mainstream. We already reported that many of the bank branches may now retail the cryptos. That is, in other words, you use your Wells Fargo account or a JPMorgan Chase account or the City bank account or a Bank of America to fund and buy crypto. And there is processing that is going to be done by Fidelity and I think it’s the NYD who is going to offer the capability of wallet management. So I think that’s on the crypto side. That’s on the regulatory side, a very bold statement, from the SEC chairman. The markets are again, we have been saying that 2021 is the year markets, for equities because of the liquidity that is available. Still, somewhere between $2 – $3 trillion of money that is sitting on consumer wallets is yet to be unleashed into the markets and there’s more stimulus coming.

Sree Iyer: Thanks for watching. As always, it’s a pleasure having you on this platform, sharing your thoughts. Viewers, Sridharji puts an enormous amount of effort in collating and analyzing and dissecting data. If you notice, he does not read from any notes, he is doing it extempore. The man has a photographic memory. Let’s tip our hats to him. Thank you very much, sir. May you live long, and let’s hope that our numbers start picking up because I am convinced that we are doing something different, we’re doing something that the world has not seen before. It takes time. We are also now on LinkedIn and a new platform called KWCH. We are streaming live on these two also. We will be doing more platforms as and when the technology catches up with what we are doing. Today’s broadcast was on 1080p. Thanks for joining. Namaskar and see you tomorrow.

Sridhar Chityala: Thank you. And again, let’s also thank Sreeji for his untiring and dedicated efforts, and again, we need your support, we’re counting on your support so that the program has virality and a much wider reach. Every day, Sreeji wakes up around 3:30 – 3:45. Remember he is on the west coast. I am in the east and when the show goes live, it’s around 5 a.m. in the morning, which means he has to be up around 3:45, get himself organized and his team organized from a production point of view as we go live. So thank you, Sreeji for your efforts. We are now into the 217th episode which is quite a number. We have not had a gap and barring the time when I was unwell. We have just sustained this day in and day out every day, five days a week. Thank you so much again for your support. And as Sree Iyerji requested, we are counting on your help in making sure that it is retweeted and shared with a number of your friends and family.

Sree Iyer: Do it within the first few seconds of you watching this thing. Thank you very much. See you all tomorrow. Let’s look for a big blast in numbers tomorrow. Namaskar.

Sridhar Chityala: Thank you. Namaskar. Have a wonderful day and a wonderful evening.