Two Goals, Two Lessons | What central bankers can learn from Diego Maradona
Diego Maradona’s first goal was akin to monetary policy of the earlier era where there was “mystery and mystique” associated with central banking. His second goal belonged to the modern central banking era
RBI’s conflicting challenges in NBFC regulation
To make India less dependent on banks is one of the central goals of our financial regulators in the next decade
A whistleblower policy every central bank could adopt
Central banks across the world should look at the European Central Bank whistleblower policy and bring themselves under a similar one. There are several benefits of such a policy
Random portfolio rejigging of RBI deputy governors needs to stop
The responsibilities of RBI’s four deputy governors need to be defined and given proper titles and job roles. This will ensure that specialists are chosen for these roles, and will signal to the government that appointments need to be made in time as departments cannot be transferred that easily
Banking troubles in old private sector banks
Earlier, the experts wrote that Indian banking is mainly about regulatory activism and near absence of shareholder activism. It is good to see emergence of shareholder activism in most unlikely of organisations: old private sector banks
Economic Sciences Nobel | Auctions, they’re all around us
Robert Wilson’s and Paul Milgrom’s auction strategy was used for allocating radio spectrums to telecom operators in the US in in 1994. Since then, this strategy has been used across countries and across sectors such as electricity and natural gas
The changing language of finance
Financial organisations have always welcomed new technologies as they are in the business of exchanging information. Now, in addition to the benefits from using technology, they will have to learn how to talk in technological terms
Will chief compliance officers check misgovernance in banks?
One thing which the RBI could have paid more attention to is the tenure of appointment of a CCO. Compliance cultures need longer time periods, especially in the initial years. Ideally, the RBI should have specified the tenure length of any number above five years
Should RBI follow the US Federal Reserve in targeting average inflation?
An AIT approach implies that when inflation is high, policy rates will remain tighter for a longer period of time as well
The Bimal Jalan committee binds RBI transfers to the government
Now, once the RBI balance sheet expands, the contingency fund will expand as well to protect the balance-sheet. This is like the countercyclical buffer which implies that when the balance sheet is expanding one is also adding to the risk buffers
RBI’s new MPC should be fit for new challenges
Now would be a good time for the government to address the issues the MPC is facing
How did Japanification of economy become a bad word?
As the 2008 crisis struck, one problem developed countries faced was to avoid another Great Depression. They managed to duck it, but soon realised that they could resemble Japan
At 90, can we expect BIS to reform and set a benchmark?
The reform of the BIS board will go a long way to make the BIS a truly global institution. It will also act as a benchmark for other global financial institutions.
Pandemic adds fuel to the central bank digital currencies race
The spread of the virus has led to concerns over using physical cash for payments despite limited evidence of the cash being a carrier
75 years of World War II and India’s deficit financing
RBI should recruit climate economists and money futurists without delay
Climate change is clearly one of those future risks that could pose significant challenges to the world economy
Credit guarantees of 1970s make a comeback
The impact of the COVID-19 crisis has been so acute that it has left the government with little choice but to consider measures often regarded as relics of the past
Tryst with destiny, planning and deficit financing
The Indian government has been able to wean itself off its addiction to deficit financing from the central bank only after liberalisation. Will it now go back to monetising deficits?
Tech | What to expect from Facebook’s Libra 2.0?
While the Libra Association has come out with a new digital currency, expect authorities running fiat currencies to continue their criticism
Policy | RBI’s functioning requires more clarity
Central bankers across the world, including the RBI, suffer from a lack of clarity when it comes to appointments. This must change, and the governments can help in bringing in much-needed transparency
The Money Helicopters are on their way
We are living in surreal times where all kinds of ideas thought to be beyond the pale are actually getting implemented
COVID-19 | What if a digital virus hits our payment systems?
Just like the SARS-CoV-2 virus has infected and paralysed human lives, a computer virus can disrupt and paralyse the digital system.
Could Modern Monetary Theory rescue us from the Covid-19 economic crisis?
The crisis has led to the usual discussion on whether one should use monetary policy or fiscal policy to ease it.
Yes Bank | Why is a Financial Redressal Agency missing when it is needed most?
One is really surprised how Yes Bank’s AT1 Bonds made way to retail investors. These bonds are highly complex instruments and even financial experts will struggle to explain the mechanics of the bond.
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