Analysis of news and views - from all fields of human interest across the globe - with a view to highlight and promote information useful for human enlightenment and development.
Said : Dr. Raghuram Rajan, Governor, Reserve Bank of India, delivering the Mahtab Memorial Lecture at Bhubaneswar on May 21, 2016.
The Global Outlook and India : RBI Governor
Delivering the Mahtab Memorial Lecture at Bhubaneswar on May 21, 2016, Dr. Raghuram Rajan, Governor, Reserve Bank of India emphasised that even though policies in the rest of the world could enhance uncertainty and volatility for emerging markets like India, because of measures taken by the government and the central bank since the “taper tantrum” in summer of 2013, India was much better prepared for global volatility.
Among the key points he made were:
The world is growing extremely slowly, and while the reasons for slow growth differ between countries, there were probably some common factors.
As a result, the decoupling of growth between industrial countries and emerging markets was probably illusory.
While final demand in industrialised countries was boosted by debt pre-crisis, which was subsequently held back by deleveraging, emerging markets needed to change their export led models because industrial countries no longer bought their goods in such large quantities. Further, the effects of ageing in industrial countries on savings and investments were poorly understood, as were reasons for the slowdown in productivity. This again makes it hard for countries to determine the right policies to boost demand.
Structural reforms to boost potential growth in industrial countries are probably still useful – for example, reforms increasing competition in services as well as reforms increasing the flexibility of labour markets -- but they are politically difficult.
Easy and unconventional monetary policy in industrial countries could increasingly be a part of the problem. For example, it could contribute to low productivity by allowing inefficient companies to continue in business. This may also depress new entry and investment by startups. At the same time, low interest rates could encourage savings as people find they need to save more to reach the amount they want for a comfortable retirement. Thus neither investment nor consumption may move up if rates are cut even further from really low levels. Furthermore, the adverse impact of capital flows, from industrial countries into emerging markets, induced by the low rates could also create volatility, which spread the slowdown to emerging markets.
Unfortunately, even if aggressive monetary policy has little positive effect, with much of even that effect coming from depreciating the currency and taking demand from other countries, central bankers in industrial countries are mandated by their monetary policy framework to keep being aggressive. The difficulty is that there is no requirement in that framework for them to behave as a responsible global citizen, as their mandate to revive the domestic economy trumps everything.
Going forward, it would be good if large central banks started thinking more internationally. To give them an incentive to do so, we need to start discussing new rules of the monetary policy game in the international setting.
These new rules will take time to develop, perhaps even decades. In the meantime, emerging markets like India should focus on macro stabilisation, building buffers and reducing vulnerabilities. "Good policy is the first line of defence – including our focus on controlling fiscal deficits, reforms like the Bankruptcy Code and Aadhaar, and our steady fight against inflation".
To limit external vulnerabilities, India is also taking measures to control inflows, intervening in the foreign exchange market as a macro prudential measure to reduce volatility, and maintaining sufficient foreign exchange reserves to be able to withstand a sudden stop in capital inflows.
Given great uncertainty about outlook and policies of others in these times, a country like India should try to take sensible measures without getting too ambitious, as we have done so far. This will serve as a sound basis for strong and sustainable Indian growth as the world economy picks up.
Said : Carl Icahn, an American business magnate, investor, activist shareholder, and philanthropist.
Billionaire investor Carl Icahn said this while announcing that he has completely liquidated his entire stake in Apple. He is reported to be owning nearly 46 million AAPL shares at the end of 2015. At today’s stock close of $94.81 the total sale value comes to around $4.5 billion.
However, appearing on CNBC news, he acknowledged that Apple was a “great company” and CEO Tim Cook was “doing a great job.” The main reason for his liquidating the Apple stock, according to him, was because of his worries about Apple’s growth in China. This was clear from his statement that if China “was basically steadied,” he would buy back into Apple.
His take on China as a whole was “You worry a little bit — and maybe more than a little — about China’s attitude,” Icahn said, later adding that China’s government could “come in and make it very difficult for Apple to sell there… you can do pretty much what you want there.”
Carl is a New York City native and grew up in Far Rockaway, Queens. After receiving a degree in philosophy from Princeton University in 1957, he attended medical school at New York University and then joined the Army. In 1961 Carl began his career on Wall Street. He has gone on to become one of the most well-known and influential investors in America. In 1968, he formed Icahn & Co., a securities firm that focused on arbitrage and options trading. In 1978, he began taking very substantial and sometimes controlling positions in individual companies. Over the years, these positions include RJR Nabisco, Texaco, Phillips Petroleum, Western Union, Gulf & Western, Viacom, Uniroyal, Dan River, Marshall Field, E-II (Culligan and Samsonite), American Can, USX, Marvel, Revlon, ImClone, Fairmont, Kerr-McGee, Time Warner, Yahoo!, Lions Gate, CIT, Motorola, Genzyme, Biogen, BEA Systems, Chesapeake Energy, El Paso, Amylin Pharmaceuticals, Regeneron, Mylan Labs, KT&G, Lawson Software, MedImmune, Dell, Herbalife, Navistar International, Transocean, Take-Two, Hain Celestial, Mentor Graphics, Netflix, Forest Laboratories, Apple and eBay.
President Obama said on Friday that Donald Trump’s recent comments that South Korea and Japan should acquire nuclear weapons show the leading Republican presidential candidate is not well informed on international relations. ‘What the statements you mentioned tell us – they tell us that the person who made the statements doesn’t know much about foreign policy or nuclear policy or the Korean peninsula, or the world, generally,’ Obama told a news conference at the conclusion of a nuclear security summit
Said : Bernard Esambert in an interview with Les-crises, a French blog intended to provide maximum information on the current crises - economic and social. The interview was conducted on January 14, 2013.
Born in 1934, Bernard Esambertwas Industrial and scientific adviser to President of the French Republic Georges Pompidou from 1969 to 1974. He was also the President of the Institut Pasteur from 1994 to 1997.
According to Bernard Esambert, French banks have been constantly increasing their cash flow for two reasons. The first, not to get eaten by a large British bank, German or American, and second, to eat the neighbor.
"Therefore, both to guard against a takeover bid from elsewhere, and in order to make a takeover bid for a domestic bank, these banks have sought to greatly increase their income so as to have a substantially increased market capitalization. But how can you massively increase earnings without attracting by making extra deposit accounts which requires enormous efforts," he added.
"We worship the bank size in France but it is not unjustified.To support our major industrial champions in the world requires a large bank and for my part, I do not mind practicing a bank patriotism as I practice an industrial patriotism, common indeed to all major Western countries.It would not occur to the mind of any American to question the nationality of Microsoft or General Motors ..."
Bernard also made it clear that in order to escape from a foreign predator and to become one domestically, banks needed to develop new business products, and not just any, risky product to achieve significantly improved results. But it wasn't easy to massively increase earnings without taking risks. Most large banks, therefore, started to introduce new original products - from low risk to very risky ones.
Agreeing with the interviewer, Olivier Berruyer, Founder of Les-crises blog, Bernard said : "Yes, we have almost forgotten that it is difficult to have high profitability without having a high risk.."
Said : FBI Director James B. Comey, as per a report in The Washington Post. The FBI is now investigating the San Bernardino, Calif., massacre as an act of terrorism.
FBI Director James Comey and Attorney General Loretta Lynch speak to reporters about this week’s mass shooting in San Bernardino, California during a press availability held December 4, 2015 at FBI Headquarters in Washington, D.C.
In an official briefingon Dec 4, with respect to the San Bernardino shootings, Comey said the incident was "now a federal terrorism investigation led by the FBI and the reason for that is that the investigation so far has developed indications of radicalization by the killers and of a potential inspiration by foreign terrorist organizations."
"We know that this is very unsettling for the people of the United States. What we hope you will do is not let fear become disabling but to instead try to channel it into an awareness of your surroundings."
According to the FBI officials, after the shooting, the Pakistani woman Tashfeen Malik, 29 - who teamed with her husband Chicago-born Syed Rizwan Farook, 29, in the mass murder - went on Facebook to pledge her allegiance to the leader of the Islamic State, the Post reported. The Huffington Post has profiled the victims of the San Bernardino shooting in it's Dec 3 edition.
Said : Annie Gowen, Delhi based India bureau chief for The Washington Post. Annie's twitter profile mentions her email ID : annie.gowen@washpost.com Annie's tweet goes as under : Annie Gowen @anniegowen
We have been contacted twice in recent weeks by private PR companies representing Indian govt. officials. Good use of govt funds? @PMOIndia
Leaders of Congress party have taken up this matter seriously, specially on the social media, under the hashtag of modimediagate. The users have their own comments on this matter. One user's comment reads : "It seems Modiji has been misinformed that international news agencies work like Aaj Tak, Zee News and India TV."
Annie Gowen is The Post’s India bureau chief and has reported for the Post throughout South Asia and the Middle East. She spent the summer of 2011 in Iraq, examining the continued violence and ramifications of the U.S. troop withdrawal there. She is a graduate of the William Allen White School of Journalism and Mass Communications at the University of Kansas and lives in New Delhi.
