Reddy’s prescription for the credit fever

“If I aim for high growth and high inflation, I am sunk. I will not be politically in trouble if my growth rate slows down to 8.5 to 8 per cent. I will be in greater trouble if my Inflation rises to 6 per cent this year.” finance minister P Chidambaram at Davos on January 25.

Four days later, RBI governor Y V Reddy effectively told Chidambaram: “I won’t let you sink.” By doing nothing in the third quarter review of annual monetary policy for 2007-08, Reddy has changed RBI’s currency, from economics to politics. In a country that’s barely begun to understand the macroeconomic, strategic, financial and, of course, political implications of growth, Reddy’s prescription this quarter is once again yesterday’s pill.

Story in The Indian Express, January 29, 2008

Faith and market

After five hectic days of going under the news and into the minds and acts of investors as they negotiated a 4,000 point fall in the Sensex followed by a 2,000 point recovery last week, the one thing I’m completely convinced about is that finally faith moves not only mountains, but everything in the esoteric, real and financial worlds. Of the esoteric we know enough, for faith is the currency through which we transact with the other side, using the instrument of prayer. But led by statements like ‘I’ve lost faith in the market’, last week opened up a whole new world of faith investigations for me.

Opinion in The Indian Express, January 27, 2008

Fallen, not broken

Seven trading days ago, on January 10, I got an SMS from a colleague who has an equity exposure that would have the Left parties deliver benign smiles of approval. “Should,” she asked, “I buy this stock (a global pharmaceutical major)?” My answer: No. Not because this person, in her twenties, doesn’t need the equity exposure --- she does --- but because I didn’t want to be the shoulder over which she would fire her first speculative shot. As I walked into office later in the day, I told our resident stocks expert that the market will fall.

Opinion in The Indian Express, January 21, 2008

Nano is beautiful

It’s a small car that’s carrying a big burden. As Ratan Tata announced and unveiled a concept that the world’s business press had been waiting for, global automakers had been afraid of, and governments in three continents had been inviting, he was, for a change, batting on the front foot. An aggression unseen so far in his generally humble and soft demeanour could be felt in his still humble and soft words. Over breakfast, speaking on behalf of Nano, his four-year, Rs 1 lakh dream, it wasn’t a defensive Tata any more. With less than three hours’ sleep behind him, it was an unusually forceful Tata.

Opinion in The Indian Express, January 11, 2008