tag:blogger.com,1999:blog-582368152716771238.post5362831723877124605..comments2024-03-29T04:41:56.077-05:00Comments on The Grumpy Economist: Rajan on PikettyJohn H. Cochranehttp://www.blogger.com/profile/04842601651429471525noreply@blogger.comBlogger12125tag:blogger.com,1999:blog-582368152716771238.post-27900879259652916082020-09-02T07:19:54.992-05:002020-09-02T07:19:54.992-05:00Many in the West express genuine and artificial am...Many in the West express genuine and artificial amazement at the India Economic Story, which is steered by the RBI, id.,est,the Robbers and Barons Of India.dindooohindoo<br /><br />How does the RBI protect the Robbers and Barons.The Indian Banking system does not do any commercial banking.It is a VC enterprise,which lends to ultra-high risk activities,id.est FRAUD.<br /><br />Let us say Mr A starts a business B and then takes a bank loan from a Private Bank Say HDFC bank - and then steals the money.Then what ? Then The RBI gives him the key to the door of a lower tier Private Bank,like Axis Bank - say,for working capital funding (after sinking the term loan - by diversion and over- invoicing).This money is also eaten up by A.<br /><br />Then A goes to a 2nd tier state owned bank - but by now his name is flashed ONLY In the banking system.So he floats a new trading cum manufacturing company called D,and starts the entire process again.Within 1 year,he digests this money also. Then he targets the STCIL,MMMTC and MSTC and PEC to get merchant financing for transactions, as a trader or an associate and he rips them off also.<br /><br />Now,the beauty is that all these Banks and other agencies,have more than Rs 900000 crores of such OUTRIGHT FRAUDS and Mr A has positioned him at a scale and a type of fraud which is far less than the rest and so,Mr A is NOT a Priority for the bank or the legal system.Now Mr A has to be creative.So he taps his trusted suppliers and other participants in the supply and value chain of Business B and D, to raise working capital loans from new banks, based on bogus financial statements - and now Mr A has a cartel - of partners in crime.So Mr A is a seed VC, who has tried and tested the banking system,and placed his confidants in a position to loot money on his behalf – who will follow the same pattern as that of Mr A<br /><br />Then Mr A moves to the last tier of the Indian Banks,which is the Cooperative banks and Societies - a perpetual black hole.Here he has to just share the loot with the bank board and the local neta.The bank will be bailed out by the state - else,there will be civil war.<br /><br />The genius of the RBI is that the Indian Public does not know the names of the companies, shareholders and directors of these FRAUDULENT BORROWERS.The RBI says that it is a State Secret.The purpose is to ensure that these Robbers and Barons,can keep the Ponzi scheme working,y ripping off as many institutions,suppliers and public as possible.<br /><br />Now Mr A has invested the stolen 1 Billion USD, in land or gold or stocks and in 10 years, it is worth say USD 3-5 billion, and he now wants to "get back in the gane".So what does he do ? He dials the banker and asks for a CDR/OTS,and the banker thinks that an angel has descended from the pole star.The entire bank staff stands in line with garlands and does bharatnatyam when Mt A descends in his Chariot. <br /><br />Mr A has the interest halved or waived,has the principal loan converted into equity and then uses his OWN 3 Billion USD to route it through some FII or entrepreneur (say USD 100 million) to be a partner in the CDR.He also secures some tax concessions for the old plant.<br /><br />People say ,Y did he wait for 10 years ? Simple - in 10 years, the demand of the products outstripped supply and the Indian economy and banking was busted and vulnerable.<br /><br />Next day,it is the top wired news across the world and a case study, for the WB and IMF and Harvard.<br /><br />But what of Company D ? Mr A says that he has redeemed his sins.So he lets the company be taken over by ARCIL, and uses his links with Netas to force some PSU to PURCHASE THE ASSETS OF CONPANY D, at the WDV and pay off the loans ! WONDERBAR ! Now Mr A will get a Bharat Ratna and be the talk of the Robber Community for decades.<br /><br />But Mr A has to get back his 100 million USD in the CDR - and so,within a year he does an IPO,and his so called partner, exists his 100 Million at 150 Million,and pays 145 million in cash back to A,and Mr A sells of 5% of the entire equity of his company B,and then,he is off to a Greek Island with the female beaus of Adnan Orkutsamir sardananoreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-61503927696240619262020-03-29T09:00:03.230-05:002020-03-29T09:00:03.230-05:00While I agree with the thought that John tends tow...While I agree with the thought that John tends toward the theoretical, I think that the statement you cite is more aimed at saying quality over quantity. It is better to publish a few well done studies over many poor ones, be they empirical or theoretical.Anonymoushttps://www.blogger.com/profile/00819497494258472109noreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-34445548248329235012020-03-22T17:34:49.426-05:002020-03-22T17:34:49.426-05:00Cochrane writes, "I measure scholarship by qu...Cochrane writes, "I measure scholarship by quality not by weight." <br /><br />On its face this statement can hardly be quarreled with. But isn't this just another way of stating, "I favor rationalist arguments over empirical ones"?<br /><br />I've always felt that Cochrane favors theory over experiment, elegant mathematics over laborious evidence-gathering. He is a rationalist by temperament. <br /><br />That's not a criticism per se; a science needs both theorists and empiricists. But this type of scholarship bias in economics does merit more scrutiny than Cochrane himself provides us.<br /><br />JZhttps://www.blogger.com/profile/12994372644670111315noreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-86455418669605751282020-03-17T22:59:23.558-05:002020-03-17T22:59:23.558-05:00Crony east European oligarchs (e.g.Czech PM is one...Crony east European oligarchs (e.g.Czech PM is one of many) definitely do not deserve to prosper in free markets...Martin Rojkohttps://www.blogger.com/profile/00354382833146079325noreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-25707489283554858682020-03-12T21:53:54.353-05:002020-03-12T21:53:54.353-05:00Envy is as much a Deadly Sin as is greed.Envy is as much a Deadly Sin as is greed.Jerseymanhttps://www.blogger.com/profile/14021431961794615870noreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-11719974134413502912020-03-12T21:53:19.553-05:002020-03-12T21:53:19.553-05:00Envy is as much a cardinal sin as greed.Envy is as much a cardinal sin as greed.Jerseymanhttps://www.blogger.com/profile/14021431961794615870noreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-82131799719887444312020-03-12T01:18:16.783-05:002020-03-12T01:18:16.783-05:00We may all have time on our hands in the next mont...We may all have time on our hands in the next month or so.<br /><br />Making the Best of Enforced Solitude: Quillette’s Quarantine Book Club written by Jonathan Kay and Published on March 9, 2020<br />https://quillette.com/2020/03/09/making-the-best-of-enforced-solitude-quillettes-quarantine-book-club/Fat Manhttps://www.blogger.com/profile/09554029467445000453noreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-48110307278439576862020-03-11T19:38:52.767-05:002020-03-11T19:38:52.767-05:00"Piketty claims instead that the nature of pr..."Piketty claims instead that the nature of property rights and their distribution is largely driven by the prevailing ideology... ."<br /><br />This is nothing more than the claim that a new man will be produced, someone without self-interest, to be guided by his or her superiors' wishes. That, of course, was naked Stalinism.<br /><br />Piketty is merely another post-modernist. Charlie Marx himself would be turning over in his grave.Frank https://www.blogger.com/profile/00272351675231621678noreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-49724456134868520242020-03-11T19:36:02.453-05:002020-03-11T19:36:02.453-05:00The recent contests held during the primary electi...The recent contests held during the primary elections have decisively demonstrated that Piketty's and Saez's proposals lack popular support in the USA. Sen. Warren and Sen. Sanders both advocated taxing accumulated wealth at punitive rates. Sen. Warren has abandoned her quest for the nomination; Sen. Sanders is failing in his. This will not be the last time we'll hear of those proposals, but it might be last time any serious contender for the position of president of USA puts those proposals forward as policy. Old Eagle Eyehttps://www.blogger.com/profile/05270080708077871311noreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-75982108994536952642020-03-11T18:22:22.220-05:002020-03-11T18:22:22.220-05:00After reading this evisceration, Piketty seems to ...After reading this evisceration, Piketty seems to be arguing something similar what Plato did in The Republic: The philosophers should run the city state. But, The Republic was also a lamentation, because it really was the end of idealism in Plato's mind. Piketty appears to have created this utopia in a version of Plato's transcendent realm, where all is perfect. Ha. <br /><br />The line I enjoyed the most:<br /><br /><i>"Also, one virtue of the entrepreneurial rich retaining control over their wealth is that they have already shown an ability to put resources to good use — which is why they are wealthy. How costly would it be to hand over their wealth to a bevy of untried entrepreneurs? Temporary ownership may be very detrimental to society’s productivity." </i><br /><br />Entrepreneurship to a large extent is being able to learn from failures <b>and</b> adapt. No one has all the answers when starting up a business. It can be, and often times is, a walk into the unknown, for the promise of generating wealth, and generating something useful at the same time.<br />Mykel G. Larsonhttps://www.blogger.com/profile/17128735421035292909noreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-4275536321859913912020-03-11T16:43:07.806-05:002020-03-11T16:43:07.806-05:00The link to FT is paywalled. Is there an open link...The link to FT is paywalled. Is there an open link?Fat Manhttps://www.blogger.com/profile/09554029467445000453noreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-63762116230537005962020-03-11T15:36:54.017-05:002020-03-11T15:36:54.017-05:00Steven Kaplan debated Emanuel Saez on the topics o...Steven Kaplan debated Emanuel Saez on the topics of wealth inequality and taxes. Kaplan did an amazing job, but they never got around to the central topic of why billionaires' existence is a problem? <br /><br />Maybe Dr. Cochrane can drive across the San Mateo bridge and debate Dr. Saez on this very point. I would certainly be very curious to see it and there's not much if any traffic on the bay area highways these days!James Carlylehttps://www.blogger.com/profile/06778250145758547603noreply@blogger.com