Wednesday, December 15, 2010

Ganga - Victim Of Religion

For always time the religious functionaries have cited excuses of services to god to extenuate the damage done to the Ganges, the holiest river in the world. The practice of dirtying the river is almost as old as the origin of Hinduism. Priests and devotees have together contributed to this practice that now is so rampant and deeply engraved in the mind and soul of the people that they very well might indict any sign of contradiction to their credo. The blatant truth, however, remains the fact that in their quest to “Dignify” their holy mother they have actually been “Dingy-fying” it.

The situation is so bleak today that an educated person would now think a hundred times (before drinking) on being offered water from this holy river. Though the process of polluting the river is all-pervasive, the situation exacerbates especially in the month of January when the holy-fairs stroll in. The Magh-Melas, Kumbhs and Maha-Kumbhs provide for a platform for a quick surge in the amount of pollutants ditched off into the river. The High-court rules, Municipal assurances and communal resolutions all are cordoned-off and people indulge in the religious spree that expedites the process and the Magh-Mela and municipal authorities haven’t yet been able to come up with any concrete measures to curb it. The period also sees exponential increase in the number of plastic bags released into the Ganges.

Another facet of this multi-faceted crisis is the releasing of dead-bodies in the Ganga waters to ensure a holy parting to the deceased. The procedure, on one hand provides another means to puff-up the dirtying process and on the other glues a morbid picture in the minds of children/foreigners who accidently happen to come across the floating dead bodies.

In today’s context, where people honour religion even more than they do their own lives, it is next to impossible to coax them out of these religious rites, especially when they have been following the rituals since thousands of years B.C. For them these rites and rituals form a set of dogma which they would do almost anything to follow

The sole solution lies in education. Mere dissemination of the idea - that how malignant this creed is - down around the public might prove to be futile unless they have a clear understanding of how relevant and called-for their abstinence in today’s scenario is. Incorporating environmental studies in all primary classes’ curriculum (and maybe with special reference to the Ganges) could be one step, creating general public awareness through rallies and Abhiyaans might be another.


Consider for example the Narmadaa Bachaao Andolan; though the mission didn't achieve enough to be an epitome that could be cited, there are evidences of tangible awareness the movement helped procure. Some efforts, while already being made by the NGO(s), need to be ramped-up to cater to the need of the hour.

We need to understand these pressing issues while we still can, lest the religious rites turn sacrilegious.

Tuesday, May 11, 2010

The Hanging Wardens Of Britain

For the first time in over three decades, Uk saw a hung parliament. The hopes cherished by the Conservative leader David Cameron came to an abrupt halt after his party fell 20 seats short of winning a majority mandate.

As the numbers stated, Conservative stood at 306( 20 short of 326, the majority figure), Nick Clegg's Liberal Democrats saw 57, 258 for Gordon Brown's Labour and 28 for others.

The Result : An Imbroglio.

While Nick Clegg failed to cash-in on the prevoius auspicious platform set-up during TV debates, Brown's performance was somewhat better than the world had envisaged.

The ramifications of a major hung-parliament remain obscure. The parties are still negotiating and re-negotiating over the coalitions.

The Prospects :

1.) Lib-Lab coal. : Nick Clegg might tie-up a coalition with Brown.

pro(s) : Clegg gets to take his major agenda( "Electoral Reform")
forthright out for public referendum. (It's noteworthy that
Lib Dems are not satisfied with FIRST-PAST-THE-POST voting
Con(s) : Doing so might foment-up general public for supporting a party the nation had rejected.
moreover forming a coalition who's leader ain't clear( Gordon Brown's stepping down) ain't no plausible.

2.) Lib-Tory Coal. : The Most foresee-able combo pro tem.

pro(s) : A Stable government, David Cameron as the prime minister and may be Nick Clegg gets to play the Home minister.

con(s) : The conservatives fail to acknowledge the need for an electoral reform. And Libe-Dems ain't got a mandate that can compell Conservatives to adapt to its ways.

Moreover, lib-dems want a proportionate representation in the house of commons, which is really very likely to be snubbed by the Conservatives.( Hating the lib-dems seems to be in their heart.)

What Can Be Anticipated : Despite major portfolio and policy contrasts, lib-dems coalition with the Tory(s) (The conservatives) looks all the more plausible and possible. It gets a stable government, afterall.

Though what turns-up, no-body knows.

Brace yourselves, the results are about to manifest themselves in a matter of hours.....

Wednesday, May 5, 2010

PIIGS Beginning To Fly?

European market indices rose quickly earlier this month on accounts of buoying generated by the Euro-Zone members confirming a Greek Bail-Out package worth Euro 110 billion, only to drop heavily the next day.

The indices all around Europe saw 2 to 3 % decline in their grades, elucidating the still-to-be-addressed-dissatisfaction of the investors who are on tenterhooks regarding a still very likely prospect of Greek default.

It’s noteworthy that even German chancellor Angela Merkel changed her stance toward ‘profligate’ Greece, evident by her efforts to try and win support of the Greek parliament on issues regarding Germany’s share of chipping-in of funds going to Greek Bail-Out.

She can be right; Germany can gain in the long run as its succour in the bail-out authorises it to borrow money at ever-lower interest rates and lend at ever-higher. But if the deal flounders, Euro-Zone leaders will have to face hard-times explaining to their citizens the impossibility of their money coming ever back again; they’ll be made to eat a humble pie.

And that’s what worries and scares away the investors: the prospect of a default. If Greece defaults, it sends jitters around the Europe and ultimately around the world as part of the Domino-effect. Immediately next in line will be Portugal, Italy, Ireland and Spain (Called as PIIGS when Greece is included).

Euro-Zone leaders have also made it clear that a similar Bail-Out package won’t be sanctioned for other countries on the brink of similar crises. The figures have been anticipated at around a Trillion Euros for bailing-out PIIGS and the notion of it fends-off the European leaders from even discerning about it.

Moreover, stiff conditions imposed on Greece by the Euro-Zone and the IMF (which ropes the bail-out with a humble Euro 30 billion out of the 110 agreed), that involves severe austerity measures that have to be adopted by Greece including public spending cuts, raising VAT to around 22-23 % and much more (and that is the cause of resentment among Greeks) ensures that no other country in future gets on a repetition pattern like this one.

Things can work out for Greece but we still can’t tell whether the PIIGS can fly.

Thursday, April 22, 2010

Green Economy: The World Ain't Enough?

What went wrong with the Homo-Sapiens in the last couple of centuries that we decided to ruin What we live on?

Our mother Earth agreed to give us all we wanted and there was no complacence, we wanted EVEN-MORE.
In our quest for happiness we've left our desired-road far behind and are now traversing the one that has equal and opposite polarity as its destination.

The time to rethink is not too-late even now. We cannot reverse what we've done but can refrain from repetitions.

The term "GREEN ECONOMY" reflects something somewhat similar. It tends to imbibe and inculcate us with morals that we can't always get wealthier and happier at the same time.

Remember, it's never-ever-ever too late to start( but don't wait until you CAN'T-EVEN-TRY).

Here's What Can Be Done::

1.)Fundamental Changes In Behavior:

A recent debate shows just how inefficient the index 'GDP' is for measuring the HUMAN WELFARE.
For the point to sink in, consider this ::

A rise in GDP means a rise in production, a rise in production means a rise in industrial activities and hence the destruction of the natural resources.

Consider the "Easterlin-Paradox":

* "countries do not become happier as they grow wealthier"

This just might be the change in behavior, re figuring-out an index that measures HUMAN WELFARE.

2.) Government Responsibilities:

* The governments might consider ratcheting-up expenditure on agriculture and Eco-friendly organizations and getting harsh on organizations high on carbon emissions.
* Carbon-emission capture plants might prove to be more than useful. It's already being pondered over in USA and other countries might adopt that too.
* Poaching and deforestation should be done away with as soon as possible.

3.) Can Global Economy prosper while reducing society's overall impact on environment?

That's the hardest part, I'd say.

Economic progress is directly proportional to the environmental damage( at least for now), and fulfilling our desires and earning our livelihood without affecting the environment negatively is next to impossible.

* Can the employees( all of'em) suddenly choose to abandon leather shoes?
* Can the whole world suddenly go Vegan( or at least vegetarian)?
* Can the airways be stopped to stop carbon emissions?
* Can the Ozone layer be refilled?

But, next to impossible ain't really impossible. We need to remain a bit optimistic.

* Investment on R&D in the field of devising mechanisms that might lead to staving-off carbon emissions might be useful.
* Develop airplanes that are Eco-friendly.
* Use so called 'Vegan-Shoes'.
* Practice afforestation/reforestation.
* Ratchet-up investments on developments of carbon-emission capture plants.

4.) industry sectors that can act as catalysts in transitioning to the green economy:

* Solar energy power plants.
* Wind energy power plants.
* R&D industries concerned with development of concepts that might help.
* Agricultural industries( save for those concerned with Tractor-Developments).
* Hoarding sector.
* Cold-Storage sector.

These are some of the various measures that can be adopted. But what really matters is:

"Practice what you preach."

Monday, April 19, 2010

Is The World N-Safe?

USA witnessed the largest ever conglomeration of countries from around the globe ever since the one during the formation of the United Nations. And the element that formed its basis was something ever-more dreadful than what you can imagine.

The world leaders have always voiced their opinion about the loose nuclear materials like the ‘Highly Enriched Uranium’ and the plutonium falling into the hands of sinister terrorist organisations, but a real action has been almost tardy.

After a significant signing of the US-Russian arms reduction treaty, that’ll serve as a great exemplar in discouraging the nations mulling over N-armament, this was another ‘paying-off’ assortment.

A latest Harvard report articulates stern concern over the safety of the nuclear materials around the globe, the most vulnerable being the stocks in Pakistan. Pakistan, globally notorious because of the ‘Abdul Qadeer Khan’ scandal, has exacerbated its reputation on the grounds that it plays host to the Terrorist organisations’ headquarters.

The malevolent LeT and the militant Al-Qaeda have both their headquarters in Pakistan and any remarkable attempt for their disbanding is yet out of sight. Leaders agonize over the uncanny measures and risible missions by Pakistani army regarding staving-off such Islamist-militant groups.

Also notable were the reactions from France. Sarkozy says he can’t abort nuclear weapons until he’s certain of others doing it too. And he can’t be blamed for that. Who’d like to be weaker when the roof is always ready to cave in, huh?

Though a response from Israel was somewhat lax. Israel refused to attend the summit due to possibilities of its own nuclear programmes’ issues being brought forward. It could have stayed and voiced its opinion.

But on the whole, the summit was a success and has already started to pay-off. Obama does have a reason to smile.

Wednesday, April 7, 2010

It was an epoch of reform

So then, what important did we have in the last 10 days?

Well, pretty much, buddies. A whole new deluge of ground-breaking agreements and policies from around the world waded their ways through the hoops.

And here’s a glimpse of the most important ones:

1.) Obama’s Health-care reform:
Widely touted as the ‘OBAMA-CARE’, this bill has eventually been passed by the US parliament after remaining in the blue for almost a year. And guess what, Obama is all smiles, beaming, laughing his fat arse out.

For those who don’t already know, Obama’s Democratic Party had lost its 3/5th majority some months back and that had marked the beginning of Obama-Woes. Number of democrats had been reduced to 59 (Pity! Just 1 short of Obama’s majority number, and that was all to preclude Obama’s regime from being filibuster-proof.)

Obama then adopted other measures for passing the bill that were hailed as controversial by the Republicans, who seemed to forget though that they had also used them.

Whatever be the scenarios now, it seems that, at least now, most of the US citizens are against this massive overhaul. Concerns also do the rounds now about the bill’s pro or con effects on the US economy.

2.) Greek bail-out package confirmed:
However much might Papandreou have been blamed for his austerity measures by his own countrymen, at least the European Commission now has a soft side for him. I ain’t sayin’ that, the Greek bail-out package is.

After much ado about ‘something’, Euro-Members finally accepted the proposal to raise funds for a ‘desperately-needed’ Greek bail-out, albeit with Mrs. Angela’s lambasting and provisos.

As per ‘her’ norms, Greece would be allowed a bail-out package only after it’s been confirmed that its markets cannot do so on their own. And even more. The majority of the funding would come through the IMF to keep a prying eye on the effective deployment of the financial aid.

Interest rates would also be high to ensure a hasty retrieval of the money out of Greece. Germany was however against this very concept of bailing Greece out and had to bear the criticism of the rest of the members for being so harsh.

It’s noteworthy, here, that some analysts believe German surpluses are one of the responsible factors for Greek deficits.

3.) America-Russia strategic arms reduction treaty in Prague:
The two world-powers will be signing this widely lauded treaty to reduce their arsenal. This would be a landmark achievement and both the nations think that this would set a fine exemplar for other nations bent on armament.

Also remarkable was the USA’s approval to change the site of the installation of the European Missile Shield project. This has ended its face-off with Russia at least pro-tem.

Wednesday, March 17, 2010

US-Banks In Agony

US’s stance on its too-big-to-fail firms just got tougher. New measures, cutting heavily on the big banks’ portfolios and profits, have been proposed.

Barack Obama, moving a step closer to his previously manifested policy (of circumscribing the BIG BANKS), reined in Chris Dodd, chairman of the United States Senate’s Banking Committee, to propose a bill that could contain the hefty firms.

The proposed bill comprises two main aspects:
1.) Creation of the Financial Stability Oversight Council.
Such a council provides for authorities to the FED to take control of any firms it deems as a threat to financial stability. Although such mechanisms did exist for banks but they did not for bank-holding companies.

2.) Creation of Consumer Financial Protection Bureau.
This one will lay-out rules and regulations for a vast range of financial products, viz. Car loans, ATM fees, etc.

These come, obviously in addition to the Federal Deposit Insurance Corporation, which have been doing hopefully well (save for the pre-recession period though).

Though the aspects of the proposal look good, Obama will need to muster a filibuster proof 60 votes, that ain’t no easy. Obama is already facing stale-mate on numerous policies like health care reforms and carbon-emission-capture-plants.

He’ll have to keep his fingers crossed to ensure that this one works out.

Sunday, March 7, 2010

Things Ain’t Workin’ Out For Greece

Looks like there’s no near end to the miseries of Papandreou and Greece. New austerity courses, due to be implemented, and albeit to their pinnacle, are still low (or ‘NO’) measures in the rest of Euro-Zone’s opinion.

When Papandreou, The Greek Prime Minister, laid out strategies for cuttin’ tax evasions, increased VAT from 19 to 21 per-cent, upped excise duties in tobacco and alcohol, and to top’em all, imposed 30% cuts on the holiday bonuses of Civil-Servants, his plans fomented-up the general public.

On one hand he’s being criticised by his own men for implementing austerity measures and on the other, by the world for being too soft and tardy. There ain’t much left for him to do and his dreams to cut the budget deficits from 12.7 to 8.7% (of GDP), this year, seems like a real-far-cry.

Greece’s borrowing requirements (for the current year) is already touching 53 billion Euros and desperate as Greece is to fund it in, the bond yields are up at 6%, and it still can’t find buyers. (Who’d take the risk, right?)

Greece is silently yet keenly watchin’ out for bail-outs from Germany and France (‘for they are all, all honourable men’) but Germans argue (and plausibly enough too) that that’d help Greece to get-off-scott-free after its years of disingenuous behaviour.

So, has Greece caught-22? Let’s wait ‘n watch.

Wednesday, March 3, 2010

Indian Budget 2010-2011

Fiscal Consolidation Has Had Its Stake

So finally all that fuss about huge government borrowings and fiscal deficits seems to be subsiding as the new budget 2010-2011 slowly unravels its promising effects.

Amid growing concerns about a possible fiscal crisis (which definitely had Pranab Mukherjee tensed), what we saw was a perfect blend of partial stimulus rollbacks and increased allocations to what was really required.

What really chinned-up the investors and corporate was the revised fiscal deficit figure which has been pegged at 5.5% of the GDP for the fiscal year 2010-2011, 4.8% for 2011-2012 and 4.1% for 2012-2013.

Unlike the last year, where the figures hovered around 6.8% of the GDP and had pronounced huge government borrowings which had in-turn crowded out the corporate sector from borrowing spree, the scenario’s more hopeful this time.

And the firms hardly took any time in understandin’ it. The result: sensex upped 175 points only moments after the budget announcements.

What really were the steps taken for fiscal consolidation?

1.) New figures for fiscal deficit pegged at 5.5% of the GDP.

2.) Raising of around Rs. 40,000 crores through divestment.

3.) Another Rs. 35,000 crores through spectrum sales.

4.) Cenvat rose from 8% up to 10%. (Illustrating a partial stimulus rollback as the new figure is still 4% down of the 14%, its pre-stimulus state.)

5.) MAT has been raised to 18%. (Previous figure being 15 %.) Though this is what took companies by plight.

6.) Custom duties for petrol and diesel, which had been abolished previously, have been re-imposed.

7.) Crude petroleum will bear a 5% custom, petrol and diesel 7.5% and other refined ones a 10% custom duty.

8.) Excise duties on petrol and diesel, previously abolished, have been revived too.

9.) The non-plan spending has been upped only by 6% and the planned one by 15%.

10.) Surcharge has been lowered by a petty 2.5 %. (From 10 to 7.5.)

11.) Custom duty on gold levied at around Rs. 840 per ounce.

And just making sure that these measures don’t mar demand and consumption, the finance minister has given the tax slab a quantum shift.

As per the new norms, income up to Rs. 1,60,000 bears no tax. (Of course it’s 1,90,000 for women and 2,40,000 for senior citizens.)

1,60,000 to 5,00,000-------------10%
5,00,000 to 8,00,000-------------20%
Above 8,00,000---------------------30%

So, overall, well done Mr. Pranab, 9% growth rate ain’t no far-cry.

Wednesday, February 17, 2010

Acquisition Spree Of Indian Firms

Bharti Airtel Keen On Zain;
Well, It’s Plausible:

It ain’t been long since Bharti’s talks to take over South-Africa’s MTN fell through and Airtel is back on track, and this time even more steadfast than it was before. It was only a few days ago when Bharti announced its plans and is already in talks with Zain, a Kuwaiti telecoms company, to buy its sub-Saharan assets for $10.7 billion (Around Rs 50,000 crores).

Looks like the Indian companies’ spree to buy assets abroad remains unaffected by the turmoil around the world. Amid the circumstances of fiscal deficits and hence tentative outcomes of the budget 2010-2011, where the investors are already wary of yet-to-come government policies and fears of stimulus unrolling, Bharti’s announcements slammed heavily upon its shares which plummeted by remarkable figures.

One of the reasons behind the investors’ ire is the speculation doing rounds about the over-valuation of Zain’s assets by Bharti. Vivendi, the French media and telecoms giant, had broken off talks in July with Zain about acquiring these assets for around the same price over issues of ‘profitability’. This is what’s worrying the investors and share-holders.

But Bharti’s plans may not be bad altogether. It should be noted that the telecom business has got saturated in developed countries and is rapidly getting saturated in the developing ones like India too. This can be supposed to have prompted the Bharti players to devise the plan. You see, the number of mobile operators in the country is already 12 and recent arrivals include Norway’s Telenor and Japan’s NTTDoCoMo. This has pushed a cut-throat low-call-rates race.

While as for the new deal (if it proceeds), Bharti should find a way-in in the 15 countries, including Nigeria, Uganda and Tanzania, where Zain provides mobile phones to some 42m customers. And noteworthy is the fact that most of’em are poor ones and provide for immense platform for telecom sector to flourish.

Though it can be taken for granted that the newly acquired assets would take a while to emerge as profitable units, but it is indeed a coherent deal (or so I consider) when you look at its future prospects.

Tuesday, February 16, 2010

Beware the 26th of feb

Indian Union Budget 2010-2011: Pro-People or Pro-Fiscal?

The finance minister Pranab Mukherjee will have to tread a tightrope in the course of framing his second consecutive budget on behalf of the UPA government. The queue of expectations is already superfluous and delivering all the things on the list seems quite out-of-question for Mr. Pranab.

It’d be worthwhile to mention that the recovery from recession around the world (India being no exception) was primarily based upon the government spending, stimulus packages, tax holidays/exemptions and sacking of many fund raising mechanisms. When the budget 2009-2010 was out, the FM had to face austere flak about not being transparent enough to mention how the funds would be arranged to meet the faces promised by the budget. Economists had foreseen a rising fiscal deficit and unfortunately that’s exactly what has come about. Worse, it’s morphing into a second version of the crisis, “The Fiscal Crisis”.

The fiscal deficit has bloated to an ever-high position and the government is anything but certain on how to bring it down. The obvious answer then comes out quite perilously: taxes.
While the corporate world stands asking for extension of tax holidays, abolition of surcharges, and abolition of wealth tax, there are individuals (us) asking for increase in limits of tax deduction, reduction in prices and increase in housing loan interest deductions.
Where should the government go?
Continue issuing stimulus packages and get exhausted of its funds?
Continue borrowing and crowd out the corporate?
Continue accruing debts and feature a great uncertainty?

Or should it rather go the other way around? Increase taxes, sack stimulus packages, unroll exemptions and build up revenue?
The government should, indeed, return to the path of fiscal consolidation. Greece is on the verge of an irreparable fiscal breakdown and other Eurozone members have still not decided whether or not to bail it out. Ensuring India doesn’t meet the same fate calls for immediate measures to rebuild the revenues.

It’s a difficult but pressing decision to unroll some of the government spending programmes right-away. The best the government can do is to initiate in a moderate fashion, i.e., neither too-much-too-soon nor too-less-too-late.

And the best you and I can do is to wait and watch “Which Way The ‘Budget’ Jumps.”

Monday, February 15, 2010

Desperate Measures For Desperate Times

Deadlock For The Indian Government

When recovery seemed just around the corner, the spook of inflation flashed its grim face, and lo, all was stalled (or so it seems). While UPA government deserves credit for turning the economy around palpably well, it’s also being reviled for letting the commodity prices go sky-rocketing. Such are the circumstances that the FM, Pranab Mukherjee will find it hard to sleep before the final framings and verdicts regarding the Union-Budget 2010-2011 are shaped. For the time being, he’s busy tackling the salvo of “Bring-Inflation-Down”.
"At 7.31 per cent, the headline inflation rate has crossed the RBI's projected rate of 6.5 per cent for March-end," says Amit Mitra, secretary general, FICCI.
It’s noteworthy that inflation is a sign of growth in economy but only when it’s a healthy one. High inflation rates can curb consumer spending beyond control and would stall progress. Thus bringing it down is vouched for by many to be the new budgets priority.
"Inflation is a matter of concern, and cooling prices a priority on industry wish list", avers Mitra.

Now What’s The Deadlock?
India, just to remind you, is still reeling under a tangible fiscal deficit (6.8%). The reason why the much fuss in the industries about cutting-down the MAT rates and extending tax-holidays ain’t being given much attention is that India wants to refill its coffers. In its attempts to redirect our country on the GDP growth trajectory of 9%, it needs funds to lend a hand to the hard-hit-sectors. That’s the reason why the government has chosen to be silent for a while. On the other hand to counter inflation, it’s chosen the Demand-Side-Management rather than the Supply-Side one. Raising the CRR by 75 basis points is due to suck out Rs 36,000 crores (Rs 360 billions) and would check demand up to some extent that’ll in turn check inflation.

It’s probably because of the same, saving funds, issues that the government has chosen to let agri-prices rise to cater to the needs of farmers rather than going for the Supply-Side-Management which it could do by providing a fillip to the agriculture sector outputs (which would have the same pro-farmer effect but would call for government spending).
Now that’s what needs to be noticed. Agricultural and other commodities are registering snowballing prices and inflation is looming high and still government is desperate on its way to shirk-off fiscal deficits and can’t adopt the required measures.
In other words : It’s a Stern Deadlock.

Saturday, February 13, 2010

Global Policies Take A Quantum Leap

• Paradigm shift in the government and bank policies around the world :

In the wake of the economic crisis, regulators and reformers around the world are eyeing for another renaissance. What was really worth considering was that the banks world-around, especially the ones in U.S.A, went under the meltdown despite years of boom. Economists world over consider it as an utter failure to retain a “decent share of their profits”. Even the big ones couldn’t avoid being in the red. This is what initiated recession and this is what the economists are trying to reform through “countercyclical buffering “. Just to provide a brief overview from around the world, here’s what you need to know:

1.) Shirking off the ‘too-big-to-fail’ :

Reformers have at last sought to change their beliefs in the organisations that are treated as ‘Too big to fail’. The ‘Baseline Scenario’ reports the notion to be rapidly gaining ground in the U.S.A. economists believe that no organisation/bank should be given the status ‘too big to fail’. In other words, even the big ones won’t be receiving government helps and bail-outs and would meet the same fate as the smaller ones. Simply put, they would be allowed to fail too. Reformers think such organisations are dangerous for the financial status of the country by accumulating the major portions of the wealth.

2.) Glass-Steagall revisited :

Just as the great depression saw the establishment of the FDIC (Federal Deposit Insurance Corporation) and the banking act of 1933 (better known as the Glass-Steagall act); Obama administration seeks to bring in the proposed ‘Volcker Rule’ very soon. Though it differs with the Glass-Steagall in many prospects, the underlying idea is the same, i.e., separating the commercial banks from the investment ones. Volcker-Rule states that:

1.) No commercial banks would be allowed to dwell into ‘proprietary trading’ or owning/sponsoring hedge funds.

2.) The overall size of the banks would be capped to about less than 10% of the U.S government insured deposits (the current figure), although how much it’d be has not been decided yet.

Though this rule makes no bindings on the commercial banks regarding ‘underwriting’, which the Glass-Steagull actually did, the theme remains the same.

3.) C.R.R rises by 75 basis points in India:

Among the major changes in Indian banking policies was the R.B.I’s stance toward the Cash-Reserve-Ratio. Each bank is required to deposit a portion of its asset with the R.B.I (reserve bank of India). The C.R.R stood at 5 per-cents but is set to rise by 75 basis points from February, 13, 2010 in two tranches. And I’m not sure if it’s for the same reason or not but the S.B.I’s lending rates are also due to rise. Looks like R.B.I’s attempt to cap India’s banks will have the citizens paying for it.

4.) Greece debt crisis:

But at least the condition in India is much better than that in Greece which is ailing under rigorous debt crisis. The government, on its attempt to jettison its deficits, has cast severe blows on its own people. Numerous schools have been shut down, flights have been grounded and hospitals are running on the emergency-only basis. Although the European Union will take this agenda as its foremost point of consideration in the meetings that follow, but for now, it seems that Greece can be forced to discontinue the use of Euro by the other nations.

The good thing for the world, though, is that at last the U.S.A is taking a tougher stance toward its big-banks. Although such measures can be ground-breaking, they’ll have to get through the opposition-protests and austere lobbying by the organisations and banks. But the conditions do seem to be turning around pro tem.