Surgical, Purgical and Mergical Strikes in the Indian Budget

The surgical strikes carried out by the Indian Army have taken the imagination of the country by storm and rightly so.

In the meanwhile, “Surgical strike” has become the absolutely new buzzword in town. Such is the lure of the word that Chetan Bhagat has immediately decided on his new book: Surgical Strike-Point-(at)-Someone. The fellow is simply incurable.

Newshour has declared 8 weeks of Surgical Strike analysis and apparently been calling up Pakistani politicians furiously to book their dates for the period. This single-handedly has caused dizzying levels of relief for Indian politicians, who for the first time in many days, feel completely free to make idiotic statements and mini-scams without fear of being grilled by the One and Only. The PR team of the UPA scion’s Kisan Yatra is said to have collapsed amidst mingled tears of joy and relief. The Kisans though, are on the run.

B-Schools, tired with meaningless terms such as “leveraging marketing strengths to enhance ground zero” are simply overwhelmed by the discovery of such a powerful new word. Harvard Business School has now officially included a new strategy in the corporate mantras: The Strike with a capital S. Bewildered students are now being asked to “leverage marketing Strike potential to enhance ground zero”. Financial Management Journals, which hitherto described “Strike Price” as the price at which a security can be purchased due to an option, now also include the definition of the “Surgical Strike Price”. This is the price at which security can be enhanced when no options are left with us anymore.

Amidst such corporate celebrations, however, the FM has been sulking. Had he known the term before, he could have leveraged it to enhance ground zero, errr, to highlight main points of the fiscal policy. How? Well, getting the GST passed was no less than a surgical strike, was it? To trump the Opposition in LS elections so as to get the majority in the Lower House, and then to diplomatically isolate them by highlighting their attempts to stall the Bill, was just the start. And then, those incessant sessions with the State Committees to understand the sticky issues and accommodate the sensible demands. Hadn’t he too, spent sleepless nights, before the passage of the Bill?

Take the case of removing the Plan – Non Plan design of the Budget.  For the first time, the Budget will be presented, way before its usual February date, without the usual priorities as suggested by a Five Year Plan. The Budget accounts will only be classified into the Revenue and the Capital Accounts, with zero mention of the legendary Plan and Non-Plan Expenditure classification. To remove the influence of the Five Year Plan from the Budget as well as do away with a separate Railway Budget has been no mean feat; a “purgical” strike, anyone?

Hmmm. And that masterstroke of creating the Monetary Policy Committee (MPC), while at the same time allowing the Governor the autonomy of a casting vote. He had simply changed the dynamics of the game; now there would also be growth combatants together with inflation warriors within the RBI. He had successfully merged growth objectives with inflation management, and how! “Oh, I should have called it my “mergical” strike” he thought wistfully.

Of course, the decision of the MPC, in its very first policy review, to slash rates has not gone down well with all economists. Dr. Rajan, the erstwhile Governor shuddered delicately in Chicago, when quizzed about his reaction to the rate cut. “It’s more of a “splurgical” strike,” he said. “A classic case of too many cooks spoiling the Booth.”

 

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Economics at Wimbledon!

Hi Readers!

I complete a year of blogging today and it’s truly been a fun experience for me. There are so many of you who got connected due to the random, mad thoughts that I post…I have enjoyed the interactions with all of you immensely! There are current students and past students who have been a major part of this virtual classroom (if you will) at manasiecon and they have been a HUGE source of positive energy for me…thank you, guys! This blog also gave me a chance to try my hand at “Tweakonomics”, a column that I write for the Hindu Business Line. A special thanks to R. Srinivasan for having visited the blog and converted it into crazy tweakonomics.

In the meanwhile, there are more wicked thoughts coming your way…so keep reading, keep laughing.

How apt to celebrate this bloganniversary with a mad look at how Wimbledon outcomes change eco-political systems throughout the world 😛

This column appears in today’s Hindu Business Line under “Tweakonomics” and you may want to view it directly at http://www.thehindubusinessline.com/opinion/net-results/article7413884.ece

Else, read it here…as usual, your comments and views are most welcome!

Economics at Wimbledon

Smirk if you will. But tennis and economics are connected. Did you really think its about grass and clay? More like who is in the EU and who goes away. Big serves and volleys? More like whether the stock rallies. Strawberries and cream? Oh, its an economic regime.

Wimbledon 2015. Court No.2 Nick Kyrgios of Greek origin, known for his antics on court, received a warning for “audible obscenity” by British umpire James Keothavong during the match against Frenchman Richard Gasquet. In the next game, Kyrgios showed his defiance by uninterestedly pushing Gasquet’s serves into the net whilst pointing to the hapless umpire.

This small incidence has pushed the Eurozone into a state of terrific panic. Inspired by the Umpire, British PM Cameron too issued a dire warning that he will be restricting movement of Greek citizens into UK, should Greece actually move out of the Euro. Greek voters, incensed by the ball-out by the referee, refused the bail-out in the referendum. What! Beaten by the French! Austerity goes into the net, while defyingly staring at the British.

In the meanwhile, the French do not know quite what to do and are hoping that the Germans do. The Germans are admittedly worried. Especially after Spaniard Rafael Nadal received that humiliating defeat at the hands of German Dustin Brown. Some people have opined that those kind of dreadlocks should not be allowed on the Wimbledon courts. The entire Spain is on a hair-trimming spree and contribution of the hair-dressers towards GDP and sentiment is at an all time high. Spain has now threatened that it may well be the next to move out of the Euro. Angela Merkel is thinking of changing her hairstyle to keep the PIIGS in check. What a d(r)eadlock!

And then, there’s Federer. This Federer Reserves a place for himself in top 5 and when usurped, can cause more economic issues than all of the Federal Reserves in the USA put together. Why, when he crashed out of Australian Open in January 2015, it got the Swiss Government unpegged and they floated the Swiss Franc against the Euro. It’s only with Stan Wawrinka’s win at Roland Garros that the Franc stabilized a bit. However, depreciation of the Federer form is generally perceived to be a greater problem than the Wow-rinka appreciation and the Franc continues to be volatile.

The clear winner is of course, Serbia. Serbia, which has long wanted accession to the EU, has grown tired of continuously answering to silly EU queries. What the deuce! We have an advantage. No.1 is quite our own Djoker. Why so serious, EU? Come on, let us in.

Closer to home, as PM Modi delivers a career grand slam internationally, Indian players have got confused as to which country to pair up with. The poor souls are trying every combination in all doubles events with players from Switzerland, Brazil, Croatia and Canada. Break point at Wimbledon to make it in India.

The dollar has never looked stronger and more “Serene”. Maria Sharapova keeps getting better too. Oh no, not her shots. Her shrieks. This year, she notched 109 decibels in the 4th round, a feat so far only achieved by India’s very own Arnab Goswami. Rumour is that we will soon see him on the tennis circuits, demanding answers for racquet abuses and unforced errors. Ear doctors and heart specialists in London are rubbing their hands in glee, thinking of the rise in business this will create. Pharma stocks have risen.

LaMo doesn’t want to stay in London anymore. He’s coming back to India.

 

Eeks, it’s the Greeks!

Dear Reader,

Hi! This column is a part of my series titled “Tweakonomics” in the Hindu Business Line. You can see the piece also at http://www.thehindubusinessline.com/opinion/columns/eeks-its-the-greeks/article7379648.ece …Enjoy!

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The flavour of this week is distinctly “Gre”. Not Grey. Though that definitely would have to be the color of this week. Grexit, Greferendum and Greekonomics. Google is flummoxed with the number of searches beginning with “Gre”. The German Chancellor is seriously thinking of changing her name to Grengela Merkel to get voted the most popularly searched Eurozone leader. The only snag seems to be the Greek PM Alexis Tsipras, who has threatened to copyright all innovative words starting with the letters “Gre”.

This, in short, is the deal. Deny us the bailout and we will see how any Great Gregarious words in this Greedy Greasy world can survive.

This has caused great discomfort to Alan Gre-enspan. Gre-at Britain, which faces the threat of being re-christened Small Britain, has given a statement that its interest is in a stable but flexible Eurozone. The Germans are thanking the day when they decided to use the Latin (not Greek) root Germanus to call themselves Germans and not Gremans.

In the meanwhile, Alexis Tsipras, that wily statesman, is trying every known Greek treek to stay within the EU and win Angela back. When Helen is to be won, sail away from the shore, leaving the Trojan horse behind. One can almost see Tsipras sailing away from the Eurozone, claiming that the austerity measures have created a “humanitarian” crisis in Greece. The call for referendum is not an impulsive decision to connect to his votebank. It’s his Trojan horse, designed to buy him time. The Achilles heel unfortunately, is the horrendously high 160% debt ratio that won’t reduce till some drastic austerity measures and reforms can be implemented.

And if copyrights and Trojan horses are not enough to coax the Germans, he can always get a bit philosophical. He’s a Greek, after all. “Be slow to fall into friendship, but when thou art in, continue firm and constant”, said Socrates. Too bad that Goldman Sachs did not read their Socrates carefully while hurrying the Greeks into the Maastricht. They seem to have trusted Pythagoras more. “All things are generated from number.” Especially EU membership. Eureka!

There is another reason Tsipras is hopeful of staying in the Eurozone for some more time. The Gre-at Depression phenomenon. At the London School of Economics, young economists were recently informed of the possibilities of the big, bad Gre around the corner. Puts your bad GRE score into perspective, this one. And who gave the young, innocents, this Greu-some piece of news? The RBI Gre-vernor, no less! And this guy really knows his crises. There is this decadal frequency with which he senses it. Further, the consultancy firms have also developed a Rajan geographical crisis indicator scale.

Here’s how. Dr. Rajan hinted at the possibility of a crisis in 2005 at a US conference. What happened next? With a two year lag, the crisis hit the US. Now that he has spoken about the Depression in Europe in 2015, it is obvious that the Eurozone will see a crisis happen only in 2017. For Tsipras, this is good news indeed. This means that the bailout and the stalemate can definitely be held off till 2017, till which time, hopefully some other country in the Eurozone will have bad enough fundamentals to fulfil the Rajan prophecy. The geographical crisis indicator scale suggests that in one decade, the crisis has moved from US to Europe i.e. around 99 degrees to the East of the US.

In the meanwhile, the Chinese are suddenly upset. They are 99 degrees to the east of Europe, you see.

The author is a Pune-based economist and can be contacted at manasi.phadke@gmail.com