Category Archives: Growth opportunities

New business opportunities.

MINT is probably as much fluff as BRICS

If you were disappointed by the BRIC hype, you are not alone. A lot of investors were even more upset when it was revealed that BRIC (Brazil, Russia, India, China) became BRICS not because South Africa was truly an emerging economy, but because there was a hue and cry over not adding an African country and adding Nigeria (the other fast growing economy in Africa) was not going to sound very well, they added South Africa.

If you have lost money trying to invest in these economies (the growth has not sustained and unless you invested massive amounts of money, you probably lost it through index funds), don’t fall into the trap replacing them. It is yet another catchy acronym: MINT (Mexico, Indonesia, Nigeria, and Turkey).

Mexico: I mean, seriously! Yes, things are slightly better than before, but if you read the news carefully, there is a civil war underway between militias, drug cartels, and law enforcement (no one knows if they are on the side of the people or the criminals).

Indonesia: This is a country that reminds me of Brazil in BRICS. Not too poor, lots of people, and a rising middle class. I can’t imagine how they can sustain the growth when Indonesian Rupiah is in free fall.

Nigeria: Be careful investing in a company because you cannot trust any financial information. Granted that this is a country rich in resources but almost all the businesses are run by thugs and crooks. So not right for individual investors.

Turkey: We have heard this music before. The country is undergoing enormous turmoil and the fight between the progressives and mullahs is about to get ugly leading to multi-year chaos.

What can unemployed Americans do?

Nobel prize winner Paul Krugman has some interesting findings. According to him, the American job market is hollowing out. What he means by that is that there is a demand for people with very unique skills in management, science, technology, and finance. These are individuals with knowledge and experience in areas that simply cannot be replaced by cheap labor overseas or even by machines (at least at this time). This is important because The Times has a story on how lawyers who were first replaced by cheap labor in India are now being replaced by software. Krugman also concluded that demand for low-skill, low wage employees is still steady, and it makes sense, considering that we simply cannot do without plumbers, janitors, restaurant workers, and so forth.

The most remarkable finding in his work is that medium-wage jobs, the kind that most Americans have had and have allowed them to lead middle class lives, are shrinking as a combination of offshoring and redundancy. In other words, if we were to see a boom in the economy, some of these jobs will come, but if Japanese experience is any guide, they simply won’t.

There are no easy answers except that people need to figure out the opportunities for themselves. One article that caught my attention is about the new breed of farmers that is coming up. It is one example where a business opportunity is emerging that no one with college degree would look at, but with the emphasis on healthy eating among high-income Americans, the demand for locally grown, organic food will continue to grow.