My Books Review: April '12

1) The intelligent investor: This is a classic book on value-investing written by Benjamin Graham who is called as the father of value-investing as well as the dean of security analysis. There are many approaches to investing but the investment based on the inherent value of the business was pioneered and perfected by Ben Graham. The approach of Graham has stood the test of time over decades surviving the worst bear markets of stock market history. The book was first published in the 40s and subsequently edited by Graham till his death in the 70s. This particular edition which I’ve read has commentaries by financial journalist Jason Zweig. 

The book in its outset explains a very important but often neglected point of investment: the difference between investment and speculation. Then starts building methodically the approach, discipline required for value investor. The approach is explained through various historical data, companies. 

It explains meticulously all the factors that are involved in investment process. Graham does analysis with microscopic details. Graham’s theory was well known in investment circles all over the world but was made popular by his most famous student Warren buffet. 

The book has its positives in its meticulous and comprehensive approach to value investing but at times gets boring when it goes into the details of US stock market history. An Indian version of the book explaining the concepts of Graham with Indian stock market history can be useful for Indian investors.

The concepts that are explained in the book require some basic knowledge in finance and investing. A layman who is new to the world of investment will find it difficult to stomach the concepts presented. This is a single, most reliable work on value investing that can’t be missed by the people from world of finance in general and investment in particular.


2) The clash of civilizations and the remaking of world order: This is an important work of Samuel Huntington which attempted to explain geo-politics in the post-cold war world. Ideology formed the central role in international relations in the cold-war era. But after the collapse of Soviet Union and ending of cold war, the place of ideology will be supplanted by culture and civilizations. Thus the book predicts there will be clash of civilization & Global politics will be multi-polar and multi-civilizational. 

The author defines what civilization is and recognizes five major civilizations in the present world: Chinese, Japanese, Indian, Islamic, and Western. The west rose to prominence in the 16th century and the author categorically says it’s not due to any superiority of its civilization. In his own words “The West won the world not by the superiority of its ideas or values or religion (to which few members of other civilizations were converted) but rather by its superiority in applying organized violence”. But there can be no denying the fact that the west is the cradle of majority of political ideologies of the world like: liberalism, socialism, anarchism, corporatism, Marxism, communism, social democracy, conservatism, nationalism, fascism, and Christian democracy. The common denominator of all these are they are the product of western civilization. 

For a universal civilization to emerge there should be a universal language and universal religion. That possibility looks unlikely. It predicts that by the about the third decade of the 21st century, Islam will be the dominant religion of the world displacing western Christianity. The reason being, Christianity spreads primarily by conversion, Islam by conversion and reproduction. It also predicts that by the middle of 21st century, the western grip on the world economy will be over. The main civilizations that are positioned to challenge the west are Confucian and Islamic.

All the civilizations should necessarily have core state which can lead all other nations of that civilization. “Islam, Latin America, and Africa lack core states. Islamist fundamentalism rejects the nation state in favor of the unity of Islam just as Marxism rejected it in favor of the unity of the international proletariat.” The future fault lines are likely to arise from interaction of “Western arrogance, Islamic intolerance, and Sinic assertiveness.”

The role of religion in the fault line war is emphasized by using the Islamic example (Afghan-Soviet war of the ‘79). The role of religion is downplayed by myopic seculars, and those who want to be politically correct. “In the end, the Soviets were defeated by three factors they could not effectively equal or counter: American technology, Saudi money, and Muslim demographics and zeal”

Then comes one of the most discussed and debated part of the book: The incidence of Islam’s bloody borders. “While at the macro or global level of world politics the primary clash of civilizations is between the West and the rest, at the micro or local level it is between Islam and the others.” It quotes many examples in this context: The situation in Bosnia, Kosovo, Cyprus (Muslim Turks and Orthodox Greeks), Chechnya, India, Malaysia, Indonesia, Middle East, Sudan & a few others.

Then, the possible causes of Muslim conflict propensity are analyzed. A few of them are:

1) Islam has from the start been a religion of the sword and that it glorifies military virtues.
2) Islam originated among “warring Bedouin nomadic tribes” and this violent origin is stamped in the foundation of Islam.
3) Muhammad himself is remembered as a hard fighter and a skillful military commander. (No one would say this about Christ or Buddha.)
4) The doctrines of Islam, it is argued, dictate war against unbelievers.

5) The Koran and other statements of Muslim beliefs contain few prohibitions on violence, and a concept of nonviolence is absent from Muslim doctrine and practice.
6) Even more than Christianity, Islam is an absolutist faith. It merges religion and politics and draws a sharp line between those in the Dar al-Islam and those in the Dar al-harb. As a result, Confucians, Buddhists, Hindus, Western Christians, and Orthodox Christians have less difficulty adapting to and living with each other than any one of them has in adapting to and living with Muslims.
7) From its origin in Arabia, the spread of Islam across northern Africa and much of the Middle East and later to central Asia, the Subcontinent, and the Balkans brought Muslims into direct contact with many different peoples, who were conquered and converted, and the legacy of this process remains.

On an ending note, the book predicts the war based on civilization between different civilizations, most likely involving Muslims on one side and non-Muslims on the other. The book envisages a hypothetical global civilizational war between China & the US, and between India & Pakistan. The US, Europe, Russia and India would engage in a global struggle against China, Japan and most of Islam. The global power would shift from the west to the east and then towards south. The great beneficiary would be India.

The cycle of civilization is explained beautifully in this paragraph: “When civilizations first emerge, their people are usually vigorous, dynamic, brutal, mobile, and expansionist. They are relatively uncivilized. As the civilization evolves it becomes more settled and develops the techniques and skills that make it more Civilized. As the competition among its constituent elements tapers off and a universal state emerges, the civilization reaches its highest level of Civilization, its “golden age,” with a flowering of morality, art, literature, philosophy, technology, and martial, economic, and political competence. As it goes into decay as a civilization, its level of Civilization also declines until it disappears under the onslaught of a different surging civilization with a lower level of Civilization.”

To avoid major inter-civilizational wars, the core states of each civilizations should stop meddling in conflicts with other civilizations, the author advocates. Also, an international order based on civilizations is the surest safeguard against world war.

This book advocates a model based on civilizations for the interactions in global politics. But the truth is that as many experts say, global politics is too complicated to be captured by any single model.

India’s success is special, incomparable..

Among many factors said about India, a few remains undisputed. A few striking features are its diversity and uniqueness. More than one billion population with such a kind of smooth flow (yes, it is!despite some glitches of course) is unparalleled in the world. With the level of diversity, no country would ever have existed or would exist. Author Gregory Roberts says through one of his characters in his novel Shantaram “India is about six times the size of France. But it has almost twenty times the population. Twenty times! Believe me, if there were a billion Frenchmen living in such a crowded space, there would be rivers of blood. Rivers of blood! And, as everyone knows, we French are the most civilized people in Europe. Indeed, in the whole world” There is something which ties all Indians together despite its unending differences and diversities.

Among civilizations, India is the oldest (undisputedly over 5000 years old) civilization of the world. There have been many great civilizations in the past but all have vanished with time. Indian civilization is the only living civilization among them. There should be something immense and profound in it if it has stood the test of time and innumerable onslaughts & invasions.

There can be no doubt that India is a complex nation. No wonder it is called a sub-continent. Two striking diversities are its religion and language. All the major religions of the world have their presence in India. Four of the world’s great religions were born in India. India always has sheltered the persecuted ones (the Zoroastrians, the Tibetans). Besides the religions, there are innumerable cults, sub-cults each practicing their own practices and interpretation of religion.

Among languages, no country in the world houses as many languages as India does. There are easily over hundred languages in India (if dialects are included the number easily surpasses one thousand). In food habits, clothing there exist a radical diversity among many parts of the country. Many say for every hundred kilometer that one travels in India, the food habits, the language significantly change.

As India has a multi-party system, there are innumerable political parties. All the parties profess their own ideologies. There is no single ideology in the country: there are parties which are left-leaning, right-leaning, language based, religion based (of course the main ideologies of all the parties are money and power, all others are secondary details!).

India of course is tormented by vast arrays of problems. Some problems like rampant corruption, red-tapism can be detrimental for economic growth of any country. Despite the host of problems, India’s economic progress has been impressive over the years. Many economists could not come to terms with it and have comfortably labeled India as ‘Magic Economy’!

A country which is not diverse, which has one common language and many other commonalities, it is easy for them to march in the direction of progress than a country which is as diverse as India. It’s like the wheels of a vehicle: if there are ten wheels and all are oriented towards a single direction it is easy to reach the destination than the situation where all the wheals are disoriented. In India, the later situation prevails. Among many other reasons, the main reason for ascendance of Soviet Union was its people’s devotion to a single ideology. It ascended to greater heights and reminded sole challenger to the U.S for a long time. (Of course the direction where people are oriented is also of immense importance. Even in Iran, the population is uniform, but to no use.)

So, these factors make India incomparable with any other country because it is too unique. Many yardsticks, parameters which measure certain attributes of India don’t do justice and seldom give complete picture of the nation.

If Buddha was born in Saudi Arabia!

Just imagine! A rebel like Buddha having born in Saudi Arabia post 622 A.D! Being a rebel doesn’t mean that one has to go against the establishment through an armed rebellion or though violence. One can go bereft of them as well. Buddha proved to the world it can be done.

At the time when Buddha got enlightened (he never claimed that he was the chosen one as some later sectarian prophets did), the great spiritual truths were not accessible to common public. It was in the besieged castle of the priestly class. The first thing Buddha did was that he made them available for the public. Sanskrit was a priestly language even then. Prakrit was the common language of the people. So, he preached to the people in Prakrit. Buddha never had any intention of starting a religion but later it was nevertheless started in his name. As they say if Christ and Buddha come back now and see what’s being done in their name they will be crying seeing the ignorance of people. 

Buddha was against established believes, dogmas, doctrines of his day. He declared there was no god. That was a big blow for the established religion of the time. He said ‘Believe nothing, no matter where you read it or who has said it, not even if I have said it, unless it agrees with your own reason and your own common sense.’ They said everything was ‘atman’ (the soul). Buddha declared all are ‘anatman’ (no-soul). There was no god, no soul. That was a death blow for the religion of his time because most of the doctrines were banked on these two concepts. Still, people did not kill him. They invited him for debates and knowledge was expounded. They worshiped him as god incarnate though he mocked at their customs and belief systems. 

If Buddha was born in some Arab nation and if he was vociferous enough to declare there was no god and if he had mocked at their belief in prophet-hood, we would never have known who the Buddha was because he would have been killed. It requires a great maturity to listen to the critics and counter-argument to the established belief system. Indians always had that maturity. Take Jesus Christ for example. He did not tell any revolutionary truths in the beginning at all. He said some simple truths for common people. But people saw him as a threat to their established religion and they exterminated him. If Jesus had been born in India he would have been worshipped as the god incarnate.

India’s religion was never organized. It had many systems and sub-systems. So, it gave a great freedom like no-where else. One could believe in god, one could believe in no-god, one could believe in nothing and still be a Hindu (though the word ‘Hindu’ was coined much later than the time of Buddha). There were idol worshippers, there were advaitins (who believed in the self and god are the same), there were charvakas (downright materialists who believed in nothing they could not see and for whom sensual enjoyment was everything).There was no action which was considered sacrilegious. In fact, in most of the Indian languages there is no exact word which matches with the meaning of the word sacrilege or blasphemy because the freedom given was such that there was no act which was blasphemous in this nation.

The Indian culture had an incredible assimilation power which was unprecedented. If anyone looks at the ethnicity of Indian population, there is all possible kind of races, religions in this country and all are assimilated so well. Swami Vivekananda while delivering the speech in the World's Parliament of Religions in Chicago said “I am proud to belong to a religion which has taught the world both tolerance and universal acceptance. We believe not only in universal toleration, but we accept all religions as true. I am proud to belong to a nation which has sheltered the persecuted and the refugees of all religions and all nations of the earth. I am proud to tell you that we have gathered in our bosom the purest remnant of the Israelites, who came to Southern India and took refuge with us in the very year in which their holy temple was shattered to pieces by Roman tyranny. I am proud to belong to the religion which has sheltered and is still fostering the remnant of the grand Zoroastrian nation.” That’s the uniqueness and strength of this culture. The very factor that this culture is living despite of various severe assaults from different people starting from Alexander to the Muslim invaders to the British is a testimony to the fact.

There have been many great civilizations but the Indian civilization is the only civilization which has not withered away with time. There should be something immense in this civilization which has made it to stand the test of time. Tolerance to other people and assimilation power are natural traits of Indian culture. So, if anyone comes to me and say Hindus have to learn tolerance, I just throw him a smile and with all contempt possible I’ll say ‘buddy! You don’t know what you are talking about’!!