Wednesday, September 4, 2013

Raghuram Rajan have to show some spine

Mangoman wrote few days back that Rajan has to be judged after his first monetary policy. But now the situation warrants that mangoman write something to Rajan before he takes over from Subbarao.

1. Corporate mafia will start shedding crocodile with every new person coming into Mint street. He should be wary of these cheats as they are responsible for the economic collapse of India.

2. Rajan should teach them the basics of economics and basic ethics of business practices. He also should tell them the importance of doing business with decent margin than obscene margin.

3.Corrupt government is not going to encourage rate increases. But Raghu has to bite the bullet as the RBI's bond sales are continuously devolving. That shows the system is screaming for rate increase. Anybody who takes are rate cut at this juncture must be a criminal.

4. Gold consumption is going to hit sky high. Better not to treat the symptom. He should straightaway raise the deposit rates and should make the financial instruments viable.

5. He should look into banks like Yes bank and Indus Ind bank and see that how many rural branches they have, instead of asking the new banks to open 5000000 new rural banks when they start operations.

6. He should tell cleary which inflation measure he is going to follow  WPI or CPI? Central bankers cannot talk as per their whims and fancies..

              ( to be continued)


  1. Will Rajan be the next Paul Volcker? Good write up in the WSJ:

  2. i dont think he will do what volcker did .But it will be surprising