Cracks In The Mask

A beam of sunlight enters the classroom, falling upon the teacher’s desk. The way the dust motes seem to dance around in the light truly fascinates me. It is as if fairies have come from a faraway land, just to lighten the sombre mood of the classroom and spread colour all around. How friendly of the fairies, and the light that was nice enough to carry them all the way here!

I feel a light tap on the shoulder. Turning around, I expect to see a friend. Instead, I find nothing but the bored face of a classmate, buried in his textbook as he snored away silently, completely oblivious to his surroundings. Oh well, it must have been my imagination. Why would someone tap my shoulder in the middle of class, and why would they tap it only once?

I turn around, hoping to see the fairies in the sunlight again, but someone had closed the gap between the curtains, putting an end to the fairy ball. My eyes wander around the classroom, settling on an especially fascinating spot, where the drywall was peeling off. I see it come to life, dancing as it weaves intricate patterns in the air. Beautiful. Simply beautiful.

The bell went off, snapping me out of my reverie. I quickly gather my books, packing them into my bag. I take out a novel by my favourite author before standing up and moving out of my chair. As I move out, I feel my foot brush against something. I glance down, and am surprised to see a paper ball. I pick it up, opening the ball and reading the contents.

“Go back to fantasy land idiot!”, it says, in what seems to be rushed handwriting. I feel a twinge of sympathy in my heart. Poor child. It would hurt to be the one this letter was addressed to. I quickly crumple the paper up again, stuffing it into my pocket. The subject of this heartless letter would not need to suffer today.

I walk out of the grey, dreary classroom, and into… the drearier hallway. The paint seems to have faded away completely, leaving nothing but the traces of hard work left behind by the workers who had put their heart and soul into building this school. I sigh, before making an impulsive decision-today would be the day I would go out and meet my friends in the playground. It had been very long, after all.

I walk down the stairs and onto the ground floor, whistling happily. The hallway seems to have been renovated recently; the bright red paint on the walls stands out against the rest of the dull school.  In fact, it seemed to be brighter and airier than before! Maybe they installed a few new windows? Who knows?

I walk towards the bathroom, and hear two voices, belonging to my classmates. Subconsciously I hide in a corner, listening in on their conversation.  

“Hey, you know that kid you threw the paper ball at? Doesn’t he just creep you out?! Ugh! I heard he has no life outside those weird novels he keeps reading. God, how creepy.”

“Seriously? What a loser, loner kid. He just needs to not be so weird. Hey, by the way, did you catch that new song…”

I feel bad for the subject. What a lonely existence. Of course, there is nothing wrong with novels, but he has no friends? My heart really does ache for him.

I walk out, turning left and into the final stretch of the hallway that is the entrance to the playground. It seems like this area hasn’t been renovated, since everything seems dark and lifeless, despite the abundance of light from the outdoors.

I stop for a moment, for some reason. I wonder why-

The bell rings, signalling the end of the break. I turn away from the playground, and run back to the classroom.

My eyes sting. The sudden adjustment between dark hallways and the outdoors isn’t to be taken lightly, after all.

I feel something wet drop down my cheek. Oh my, the light made my eyes water.

I ignore the sudden deluge of tears, no doubt caused by the bright and malevolent light, and wonder about the boy they threw the paper ball at, and the boy who they made fun of in the bathroom.

I hope he makes friends soon enough.

Oh, I should slow down. My watering eyes are blurring my vision, making it hard to see in this colourless, drab hallway. I don’t want to trip and fall, after all.

The Love-Hate Relationship Between Bitcoins And Governments

Image from Quillette

According to Merriam-webster, Bitcoin is “a digital currency created for use in peer-to-peer online transactions.” This basically means that direct transactions can take place without the interference of a central authority, electronically through what is called a ‘blockchain’. The creator of bitcoins is known by the pseudonym ‘Satoshi Nakamoto’ but the gender, age, etc. of the creator is unknown. Nobody even knows if Satoshi is a single person or a group!

Bitcoins are obtained through a process called ‘mining’ with the help of supercomputers that solve increasingly complex puzzles. The reward for solving these puzzles, of course, is one bitcoin. The mining consumes a massive amount of fossil fuel. As a result, the supercomputers used for the same are usually set up in China due to the low carbon tax. Of course, bitcoins can’t be mined for all eternity; about 18.5 million bitcoins have been mined so far, out of a total of 21 million possible bitcoins. This means that the moment we reach the upper limit for bitcoins, we’re out. There’s no way for us to obtain more.

Bitcoins are extremely hard to counterfeit too, making money laundering harder. It is even considered ‘pseudonymous’ since no one can link you to the pseudonym you used for your bitcoin transaction unless it is accidentally revealed in some way. All of this is well and good. However, Bitcoin is more volatile than an Indian parent after you accidentally let slip that Sharma ji’s son got more marks than you.

In April 2021, one bitcoin was worth about 60 thousand USD. And now? It’s barely even worth 33 thousand. Let’s compare it to gold, which was earlier the standard for a lot of currencies. The value of gold seen an increase of almost 50% in the past half decade whereas bitcoin…well, it’s another ball game altogether. An increase of 4000% percent from 2016 to 2021. This is, to put it simply, insane. There’s a good reason why many people consider investing in cryptocurrencies like bitcoin more akin to gambling than sensible investing. Especially since Elon Musk’s tweets seem to control the flow of cryptocurrencies.

As a result, many governments are trying to stop bitcoin in its tracks for multiple reasons, including the amount of energy it uses (5% of ALL the energy in China is used by bitcoin mining computers).

 1) China recently (in May 2021) banned cryptocurrency trades. People holding cryptocurrency wouldn’t be penalized but “The institutions must not provide saving, trust or pledging services of cryptocurrency, nor issue financial product related to cryptocurrency”. Even in 2017, they shut down local cryptocurrency exchanges in attempt to torpedo the ever growing, unstoppable behemoth.  

2) The Indian Government banned banks from dealing in cryptocurrencies in 2018. Though this order was overturned by the Supreme Court in 2020, the government is still pushing for regulation of cryptocurrencies.

3) The use of 12 virtual currencies (including bitcoins) for official transactions is illegal in Bolivia.

And yet, countries like El Salvador, headed by the ‘good dictator’ Nayib Bukele plan to use bitcoins alongside the dollar as official currencies…

 Similarly, in Venezuela, many are adopting crypto money as spiralling hyperinflation has harmed the Bolivar, the official currency.

With all these changes taking place, it is hard to understand what exactly prompts governments to take the decisions they do. The primary reason, no matter what they say, is the fact that a widespread use of cryptocurrencies would make central banks and their monetary policies obsolete. I personally believe that having central banks lose a bit, or even a fair amount, of their power would hurt no one. After all, it’s the banks that often mess up and cause further inflation, unemployment, etc. The financial crisis of 2008 and the mistakes of the central banks and their heads in helping solve the problem continue to hurt the common man today as well. Did you know that in 2009, Hank Paulson cost taxpayers an additional, saveable 40 billion USD?  The US government decided to bail out the 9 largest banks in the country by providing them with capital infusions, rather than by purchasing their bad debts. Paulson used 125 billion USD of taxpayers’ money in exchange for shares in the banks. However, three weeks prior, Warren Buffet had done something similar with Goldman Sachs and had secured more generous terms. If Paulson had done the same as Buffet, the US taxpayers could’ve made almost 40 billion USD. This is just one example of banks exacerbating already existing problems.

And still, it is hard to argue against banks. Why? Simply because they provide security. If the world was to (for some reason) adopt cryptocurrencies as fiat (official) currencies tomorrow, it would be well and good- transactions would take place seamlessly, anonymously and easily. However, who would you approach if banks ceased to exist, and you needed help since you got scammed? Who will you approach if your transaction gets stuck in the electronic equivalent of limbo, and now you have no money or assets? Who will give you interest on money that you deposit with them?

And even more importantly, how much worse would the financial crisis have been if the government/central banks didn’t intervene?

So, it is clear that while banks have their drawbacks, it is impossible to imagine a world without banks that can function without devolving into a dystopian society.

Having established the importance of banks, as well as the problems with bitcoins, I would like to talk more about the bitcoin scenario in India, as mentioned in the second example given earlier.

There are talks of a new bill being passed in the parliament, regarding cryptocurrency. This bill would prohibit all private cryptocurrencies and also begin the process for the launching of a central digital currency. The RBI has stated that it is working on creating a new central bank digital currency (CBDC) that would eliminate the need for cryptocurrencies. RBI has also expressed worries over the fact that cryptocurrencies can easily be used for illegal activities since it is borderline impossible to track it successfully. Moreover, bitcoins, if stolen, cannot be compensated for by anyone either. If you lose your private key (sort of like your personal bitcoin wallet), you lose your bitcoins forever and ever. Mt. Gox, among the largest virtual currency exchanges, declared bankruptcy and shut down after having bitcoins worth 350 million USD stolen from it. Bitfinex, a major bitcoin exchange, was also hacked and lost 60 million USD in bitcoins.

Even if the government decides to step in and offer protection for virtual currencies like these, there’s no guarantee that your money will remain safe and sound. I’m sure all of us have heard of the Colonial Pipeline being hacked and 2020 United States Federal Government Breach. Then again, this does go for practically any virtual currency.

To sum up, the GoI and numerous other governments are pushing for regulation of cryptocurrencies, while also trying to finalise their own CBDC and release it to the public. The Bahamas have already taken a step in this direction, releasing their virtual currency known as the ‘sand dollar’ as a digital fiat currency alongside the standard pen and paper currency in October 2020.

I believe that while banning cryptocurrencies entirely would not be a smart move, (as bans and censorship often serve as a pathway to proliferation of the banned thing) there is some need for regulation. Moreover, awareness needs to be spread about virtual currencies and people educated about trading and the stock market. How many times have all of us seen advertisements scream “GET RICH QUICK BY BUYING [insert any cryptocurrency]!!!!” on any website related to finance and the economy? I know that I have seen dozens of these advertisements and I can personally attest to the fact that my mental health has suffered as a result of this constant barrage of ads. Of course, I don’t actually fall for such ads. But imagine how many people do fall for these, and for more scams. Such people need to be taught, at the very least, about the basics of trading. We all must understand that if something’s too good to be true, it probably isn’t.

Though I digress, all it comes down to is this- you’re probably better off not investing in cryptocurrencies, especially since many governments are going to be working against it.

The Lie Of Trickle Down Economics

image from thenewmainetimes

Trickle Down Economics, popularized as Reaganomics, is simply a pseudo economic theory that aims to benefit the ultra-rich while masquerading as something that can lift the poor out of poverty.

This ‘theory’ advocates tax-cuts for the rich, stating that more income for the rich can effectively lead to employment generation and greater income returns for the poor, since the wealthy will obtain more money which can be invested further. Thus, it can be considered as a subset of supply-side economics, which deals with tax-cuts for society as a whole.

In Trickle Down Economics, corporate taxes are cut; taxes may be cut for wealthy taxpayers as well. So, essentially, the private sector benefits from a higher level of income. Thus, wages for workers increase, new factories pop up everywhere, and people are incentivised to invest more- all of which leads to a boom in income generation.

This widespread economic growth, in turn, leads to more revenue for the government, since they collect more through income tax revenues, which more than compensates for the money they initially lost due to the tax cuts.

In theory, all of this sounds well and good. It makes sense too, does it not? The ultra-rich have more money than ever in their hands, which they can invest into the economy. This will lead to the poor receiving the ‘bread-crumbs’ that fall off the table- in other words, money that trickles down. The government benefits too!

It has worked to some extent in practical situations, though the true causes remain unclear. After all, correlation is not equal to causation. For example, this theory played a role in ending the 1980 US recession.  According to sources, Reagan cut taxes- from 46% to 40% for corporates and to 28% for anyone earning above $18,500. Defenders of the theory often cite this as evidence of Trickle-down economics being valid.

At the same time, however, he increased government spending, almost tripling the Federal debt from 1981-1989. Thus, it is just as likely that the massive government spending helped end the recession, rather than the tax cuts themselves. Of course, this part is oft ignored and omitted, so that a favourable view of the theory can be promoted.

More recently, in 2017, President Trump signed the Tax Cuts and Jobs Act, resulting in a reduction of corporate tax rates and tax rates for the rich. According to a study by the Tax Policy Centre,  based on this act, “on average in 2027, taxes would rise modestly for the lowest-income group, change little for middle-income groups, and decrease for higher-income groups.” In other words, not even close to what the move was touted to be. Trump even said that the act would help compensate for the loss incurred due to tax cuts, but the Joint Committee on Taxation states that it would result in the debt increasing by more than a trillion dollars.

Kent Smetters, Wharton professor of business economics and public policy, believes that trickle-down economics is nothing but a way to disparage supply side economics. In fact, he even states that “this is not something we have tested or seriously theorized about as economists.”

Similarly, according to popular financial website, Investopedia, “Trickle-down economics is political, not scientific. Although it is commonly associated with supply-side economics, there is no single comprehensive economic policy identified as trickle-down economics. Any policy can be considered “trickle-down” if the following are true: First, a principal mechanism of the policy disproportionately benefits wealthy businesses and individuals in the short run. Second, the policy is designed to boost standards of living for all individuals in the long run.”

More recently, a 2020 study by the London School of Economics that studied data over 50 years from 18 countries found that the only significant effect of Trickle-Down Economics was that it created further income inequality.

This is also evidenced by the fact that income inequality worsened between 1979 and 2005 due to tax cuts by US presidents Reagan and Bush and after-tax household income rose 6% for the bottom fifth. What is wrong with that, you ask? After all, an increase in income levels is good for everyone, isn’t it?

And I agree with you, dear reader. ‘Money makes the world go round’, as Joel Grey and Liza Minnelli sang, and more money is always helpful.

But this isn’t true if the top 20% see their incomes increase by 80%, and the top 1% see their income triple. Instead of the money trickling down, it seems that it trickled up- leaving behind nothing but a barren wasteland for the poor while the rich frolic in their paradise fuelled by the hard work of said poor.

It is thus reasonable to assume that Trickle-Down Economics is nothing but a load of hogwash. It seems as if those who support this theory forget that selfishness is a trait intrinsic to an unfortunate number of humans, especially those in power. Pope Francis himself said it best in his third Encyclical, “Fratelli Tutti”, on 4th October, 2020: “Some people continue to defend trickle-down theories which assume that economic growth, encouraged by a free market, will inevitably succeed in bringing about greater justice and inclusiveness in the world. This opinion, which has never been confirmed by facts, expresses a crude and naive trust in the goodness of those wielding economic power and in the sacralised workings of the prevailing economic system.”

Yet, the Indian Government led by Narendra Modi in 2019 decided to cut corporate taxes to 22% from 30% and to 15% from 25% for new manufacturing companies- this took place less than 40 hours before Modi’s Houston trip.

According to Modi, “This move will give a great stimulus to #MakeInIndia, attract private investment from across the globe, improve competitiveness of our private sector, create more jobs and result in a win-win for 130 crore Indians.”

Of course, many people genuinely believed this. However, this move, which resulted in a loss of nearly Rs. 1.5 lakh crore through direct tax revenue for the government, has done little to stimulate the economy and increase FDI.

In FY 2019, India received about 50 billion USD through FDI, but a sizeable amount of it was made before the move by Modi. Thus, it is clear that the tax cuts did little except increase income inequality (as expected, by most familiar with the nature of Reaganomics and by extension, its derivatives).

Even the GDP dipped a few points, before COVID struck. Moreover, the unemployment rate didn’t increase or decrease by a massive amount, which was what most people would probably expect from such massive indirect expenditures meant to, in part, fight unemployment. Of course, this is all being said without considering the pandemic and its effects on the economy. No one can be blamed for the problems it posed since it was beyond our control.

If the government had not taken such a bold step all the way back in September, 2019, it would’ve had more money to give to the poor. More money to help fight the pandemic. I’m sure that all of us would rather pay higher taxes and receive benefits from the government in return, than have the rich getting richer, and the poor getting poorer.

#UncleTim- What is it? Where did it start from?

Twitter Blocks 'Uncle Tim' From Trends Section After Senator Tim Scott's  Speech
Senator Tim Scott- image from Yahoo News

President Joe Biden of the United States has been pressuring the Congress to pass the new Criminal Justice Bill, and push for police reform, before the 25th of May, 2021- the anniversary of George Floyd’s death- in his first State of The Union address.

In response, Senator Tim Scott, a Black Republican, remarked, “America is not a racist country.” This remark resulted in outrage on social media, and led to the #UncleTim tag reaching the #10 spot on ‘trending’ in twitter.

‘Uncle Tim’ is a play on the phrase ‘Uncle Tom’, the protagonist of Uncle Tom’s Cabin, an abolitionist novel written by Harriot Beecher Stowe in 1852. Uncle Tom is often used as a derogatory term to refer to those who ‘betray’ their culture by supporting the opposition or by being complicit with oppression. Typically, it is used to refer to a Black person who is subservient to white people.

Twitter allowed the attacks on Senator Tim to run for almost 12 hours, before it stopped the tag from showing up on the website. Many have criticised him for his comments, which have been called ‘inherently contradictory’, due to the fact that he earlier mentioned the discrimination and racism he faced. However, others have praised the Senator. Fox News anchor Martha McCallum praised him for resonating with the people and for his sincerity, while fellow Republicans too have applauded him for being a representative of the conservative viewpoint in the country.

Effects of COVID-19 on Indian Start-ups

The dire state of Indian Start-ups due to COVID-19

India is a country that can definitely be described as a haven for entrepreneurship, as it has the third highest number of start-ups in the world. With fast-paced innovations in technology, and rapid economic growth, it would not be wrong to say that India has the potential to become an economic superpower in the near future.

2019 saw an increase in the investments in Indian start-ups. According to major research firm Tracxn, $14.5 billion was invested in start-ups in the year 2019, an increase of more than 30% from 2018. More than 1000 start-ups were launched in India. 9 companies joined the league as “Unicorns”- companies valued over $1 Billion. Tracxn also believes that 60 companies are soonicorns, or soon to be unicorns, which means that they have the potential to be unicorns in the near future.

Growth of international investors in start-ups: by Tracxn

After the massive increases in investments in 2019, many experts expected 2020 to be a year with even greater profits. However, all expectations were subverted, due to the spread of the novel coronavirus or COVID-19, causing a pandemic that swept through the nation, causing massive damage to every facet of society. The virus resulted in a loss of human lives, but also crippled the economic sector of India- to the point where India witnessed the largest GDP contraction ever in the second Quarter (April–June) of FY2020–2021 at -24%

This also harmed the growth of start-ups in India; According to a report by Venture Intelligence, funding in March 2020 fell by a whopping 50%, which spells trouble for all stakeholders. The plight of the start-ups was exacerbated by a change in the Foreign Direct Investment Policy. The change was made on 18th April, 2020, in order to “protect Indian companies from acquisition during the pandemic by its land neighbours”. This means that any investment by a country sharing land borders with India would have to receive approval from the Government of India, or The Reserve Bank of India, before being made. While this is an admirable step from the point of view of protecting domestic companies from foreign, particularly Chinese, control, this also means that any investment made would take longer than usual. Additionally, 18 of 30 unicorns are backed by Chinese venture capitalists and investors. Chinese investments are valued at about $8 billion, far more than the investments made by the rest of India’s neighbours combined.  

Yet, some start-ups have benefited from this pandemic, and have helped alleviate the damage caused by it. The E-commerce sector has made massive profits- the grocery segment saw a 76% hike in sales due to the high demand for door-to-door delivery services. Tech giant Amazon also reported huge profits in 2020, as did other ecommerce vendors. Uber launched “UberMedics”, to provide transportation in order to support frontline healthcare workers, while Ola provided 500 cars to the Karnataka State Government as a show of support.

Why the discrepancy? Several factors could have caused this. The lockdowns in India drastically affected the production of goods, which caused damage to the supply chain, thus hurting industries. In contrast, tech start-ups soared in value. Zoom, a hitherto relatively unknown company, became a household name over the course of a few months. Its value increased by 569%, raising its market cap to $129 billion, which means that it is one of 20 biggest tech companies in the USA. Zoom is but one example of a tech start-up that increased in market value. Still, the economy as a whole was suffering.

COVID cases reduced from November 2020 onwards- this gave the economy breathing space. However, it was a short-lived relief as India was hit by a second wave, often described as a ‘tsunami’, which brought with it mutant strains of the coronavirus.

The second wave of COVID has also negatively impacted the economy, albeit on a smaller scale, as industries are still functioning to a limited extent, and the chain of supply has not been completely broken. Vaccination drives for adults were also started on May 1, 2021, which will go a long way in helping the nation combat the pandemic.  Thus, things are beginning to look up for the economy. It is likely that India’s GDP will reach 2019 levels by 2022, after which start-ups will also most probably witness an increase in investments.

Black Fungus- the illegitimate child of COVID that appeared after 13 years

A short blog post about Black Fungus and its spread, symptoms, etc.

Mucormycosis Black fungus: All you need to know about the black fungal  infection symptoms, treatment and prevention
Image from The Times of India

COVID-19, caused by SARS-CoV-2, is the first pandemic faced by humanity in 10 years. First discovered on New Year’s Eve in 2019, the virus has wreaked havoc. As if causing untold damage to the economy, to the healthcare system, and to humanity as a whole wasn’t enough, it mutated and created variants that were both, more dangerous, and more contagious. Now, however, we may be facing something far more sinister- something that would be right at home in a post-apocalyptic movie.

A horrifying infection, mucormycosis, or black fungal infection, seems to have ‘resurfaced’ in 2021, as reports are being made of patients contracting it. In Maharashtra, news media reported that 200 patients who had recovered from COVID contracted mucormycosis, and 8 of them died. The threat posed by this disease and its symptoms is enough to plunge even the most optimistic of minds into despair, and seems to be increasing day-by-day; Gujarat recently ordered 5,000 doses of Amphotericin-B medicine to combat it.  

Black fungal infection causes facial swelling on one side, a splitting headache, nasal congestion and black lesions in the mouth, and an extremely high fever. The infection has a mortality rate of 54%, and spells certain doom for those infected by it, if it reaches their brain. To prevent the infection from spreading to the brain, some patients have undergone surgery to have their eye removed. The sheer danger of this disease makes the loss of an eye seem like a trivial sacrifice.

Of course, mucormycosis isn’t a disease caused directly by the virus. In fact, it was first reported by a 2014 study of a fungal outbreak in a pediatric hospital in 2008, where 5 children met their demise due to it. Scientists speculate that the anti-immune steroids taken by COVID patients to reduce inflammation also weakened the body’s immune response, leading to them contracting the fungal infection.  For similar reasons, diabetics are particularly susceptible to it, owing to their compromised immune system. Thus, they, and people with compromised immune systems, should be especially careful about maintaining social distancing rules and wearing masks.

Hopefully, with mass vaccination drives taking place, and with lockdowns being enforced more strictly throughout the nation, we can hope to see an improvement in the condition of the country. For now, all we can do is pray for our ‘happy ending’ to this dystopian movie we seem to be stuck in.