Courtesy of Russ Winter of Winter Watch at Wall Street Examiner
There are large scale rolling blackouts in India now affecting 700 million people. The causa promixa is hot weather and a drought, and the causa remota is infrastructure neglect. This Economist article details a bagunca of heavily indebted infrastructure companies, bad loans and poor policy. I offer the chart of India’s busted infrastructure ETF without comment. The International Energy Agency estimates that India will need close to 250 more electric grids to make the country fully electrified. In comparison, the estimate for China is for an additional two new grids. In fact, a 2010 report by IEA on poverty and energy lists 400 million Indians without electricity, this compares to China at only 8 million without electricity.
This illustrates in spades “complexity theory.” This is where we see short term slash and burn operations such as urbanization around manufacturing without making the expensive investment necessary to support the new complex system. Frankly I am surprised this took this long, and do not think it is an outlier event at all.
Complexity is not free, and it is all reducible to energy.” – Joseph Tainter
For additional analysis on this topic and related trades subscribe to Russ Winter's Actionable – risk free for 30 days.The subscription fee is $69 per quarter and helps support Russ.s work on your behalf. Click here for more information.
Copyright © 2012 The Wall Street Examiner. All Rights Reserved. The above may be reposted with attribution and a prominent link to The Wall Street Examiner.
