Monday, June 13, 2016
Sovereign Man on Vietnam
Capitalism Always Wins
Under communist rule, Vietnam suffered some of the worst economic conditions imaginable: soaring debt, inflation, corruption, unemployment, rampant poverty, and even famine.
The central planners created extraordinary mismatches in supply and demand and production inefficiencies.
It was just like those old stories from the Soviet Union– too many factories making left boots without any factories making right boots.
Eventually they saw the light, and nearly all of these socialist countries started a long, slow conversion to embrace capitalism.
It really started in earnest about 15 years ago after Vietnam signed a trade deal with the United States.
And since then the changes have been extraordinary.
Capitalism always wins because people want the comfort and lifestyle that become possible when talented people have the incentive to work hard and innovate.
It doesn’t even really require too much to create these incentives. The recipe is simple: property rights, financial reward, and limited bureaucracy.
I am really stoked on Vietnam and because of a couple of catalysts which I mentioned here I expect the market in Vietnam to really take off. I also got in on the cheap at a discount which is also nice. Vietnam is one of my favorite economies and I am expecting big things over the next few years.