Raghuram Rajan ex RBI governor

techynt · Post by **techynt** » Sun Jun 19, 2016 8:07 pm

I feel that now it will be similar to congress time, it will be all smoke and mirrors, RBI will be used to cover up things to make it look good in the short term to win elections.

http://www.bloomberg.com/news/articles/2016-06-19/with-rajan-undone-by-indian-politics-pressure-rises-on-modi

direstraits88 · Post by **direstraits88** » Sun Jun 19, 2016 10:28 pm

Rajan insisted on banks cleaning up their NPAs. Monies owed by Big business to various public sector banks, ~ 1 Lac crores..

So the big business asked Modi to let his crazy dog (subramania swamy) go after Rajan.

With Rajan out of the way, now the expectation is more money will be made available to these crooks ( i mean business men). legal looting ! Banks will just cook their books to show no NPA to write down their losses.

Half way into his 5 year term, Modi has not much time to deliver ! The billion dollars spent on buying media and people need to be recouped with interest by his backers before the next election cycle.

techynt · Post by **techynt** » Mon Jun 20, 2016 3:40 am

my biggest worry is that govt will now use the printing press of RBI to flood the market with cheap money, unfortunately it will not be free market driven and transparent, it will be based on crony capitalism only to people with right connection.

All Indian govts, in the past 5 decades, have been unable to find a solution to food inflation so they try to subsidize in other forms.

And then they are going to cut the interest rate in the name of improving economy all the while inflation will again go to 10%...

At average income of around 5 lacs, people are willing to pay 50 lacs for 2 bedroom apt, around 10 times income, when mortgage rate is at 10%, I cant imagine where the home/land price will be when mortgage rate goes to 7% or lower (I am expecting them to cut the interest rate to less than 5% in 12-18 months, unless markets does not allow them to do it).

I have significant amount of Re FD in Indian banks, but they are earning around 10% interest since I had fixed them for 10 years a while back. Even then I am contemplating repatriating the money back to USA since the biggest risk is to Rupee. Anybody else thinking about repatriating their deposits?

plansup · Post by **plansup** » Mon Jun 20, 2016 4:14 am

I would if I could, repatriate the money that is. Mine is locked , that means I cannot even break FDs until maturity.

The whole Rajan thing speaks of general paranoia about NRIs and more specifically US NRIs. The fact that Rajan was so mercilessly attacked for his green card and US connections and nobody frm govt minced a word in his defense is so telling on the new psuedo-nationalist despensation.

It's good for Rajan in the end, he can go where his heart his, academia ie. These baffoons dont deserve him. The rest of the circus will go on for another 3 to 8 years unfortunately.

Old-Spice2 · Post by **Old-Spice2** » Mon Jun 20, 2016 4:17 am

techynt;633120my biggest worry is that govt will now use the printing press of RBI to flood the market with cheap money, unfortunately it will not be free market driven and transparent, it will be based on crony capitalism only to people with right connection.

All Indian govts, in the past 5 decades, have been unable to find a solution to food inflation so they try to subsidize in other forms.

Nothing of that sort is going to happen with Modi govt. During the last NDA-1, the inflation was running at 4%. Interestingly consumers were complaining the FD returns are low but did not consider inflation was also low. That time there was no Rajan heading the RBI. Losing a talented person is a loss for the govt but it is not end of the world. There are other talented people in the country who can run the show.

RBI is only part of inflation control. Other side is done by Jaitley and his team by controlling govt expenses and fiscal deficit.

farfromhome · Post by **farfromhome** » Mon Jun 20, 2016 6:38 am

Old-Spice2;633125Nothing of that sort is going to happen with Modi govt. During the last NDA-1, the inflation was running at 4%. Interestingly consumers were complaining the FD returns are low but did not consider inflation was also low. That time there was no Rajan heading the RBI. Losing a talented person is a loss for the govt but it is not end of the world. There are other talented people in the country who can run the show.

RBI is only part of inflation control. Other side is done by Jaitley and his team by controlling govt expenses and fiscal deficit.

Forgotten story :)

http://www.businesstoday.in/magazine/features/rbi-monetary-policy-review-rates-unchanged/story/189551.html

Lakshya · Post by **Lakshya** » Mon Jun 20, 2016 6:59 am

direstraits88;633112Rajan insisted on banks cleaning up their NPAs. Monies owed by Big business to various public sector banks, ~ 1 Lac crores..

So the big business asked Modi to let his crazy dog (subramania swamy) go after Rajan.

With Rajan out of the way, now the expectation is more money will be made available to these crooks ( i mean business men). legal looting ! Banks will just cook their books to show no NPA to write down their losses.

Half way into his 5 year term, Modi has not much time to deliver ! The billion dollars spent on buying media and people need to be recouped with interest by his backers before the next election cycle.

Can we have some logical answer.... this NPA was built up in last 2 years? Rajan was not appointed by Modi... so why all these businessmen never told Manmhoan singh to remove rajan? Not defending current govt decision to let go rajan but looking for a solid reason for Rajan exit...

plansup · Post by **plansup** » Mon Jun 20, 2016 7:19 am

It is only politically convenient to keep blaming previous govts for all the malaise. Dates below should make it abundantly clear the meaning of "mentally not fully Indian".

In India, following the asset quality review, banks have reported a near 70 per cent surge in non-performing assets over the last six months. Gross NPAs of banks and institutions have shot up by Rs 2,41,000 crore in these two quarters — December and March quarters of fiscal 2015-16 — mostly due to the aggressive provisioning undertaken by PSU banks at the behest of the RBI.
According to data compiled by Care Ratings, gross NPAs have surged from Rs 349,113 crore in September 2015 when the RBI ordered the asset review to Rs 590,772 crore by March 2016.

The impact of the Reserve Bank of India’s Asset Quality Review, which is at the heart of the “deep surgery” prescribed by the RBI Governor Raghuram Rajan in February as a desperate measure to clean up bank books, could be beginning to show results.

According to RBI deputy governor SS Mundra, even in tier II and tier III towns, promoters have begun to realise the banks are going to come hard after them if they do not observe credit discipline.

http://indianexpress.com/article/business/business-others/rbis-asset-quality-review-deep-surgery-starting-to-show-results-2838340/

Desi · Post by **Desi** » Mon Jun 20, 2016 7:38 am

Lakshya;633129Rajan was not appointed by Modi... so why all these businessmen never told Manmhoan singh to remove rajan?

Because under MMS he was only there for less than a year and that is not sufficient time. It takes time to make ones policies apparent. I am sure it took some months first to understand the system before he started shaping his policies. And by the time NPA issue became a serious issue, the Modi govt was already in place and had been. It is more than that. Rajan has been vocal on issues of tolerance and religion which does not sit well with current govt.

rajradio · Post by **rajradio** » Mon Jun 20, 2016 7:57 am

I cannot understand the banks and industry glamour to reduce rates, we already have so much excess liquidity due to rampant corruption, the inflation will crazy if reduce interest rates with such a bad fiscal management