Archive for December 1st, 2014

Don’t buy the hype over payment banks..

December 1, 2014

Given the state of banking in the world, one keeps wondering why should there be so much excitement with respect to banking. The banking stocks keep scaling new highs. The margins in banking have been shrinking and likely to shrink further with technology. It is also highly competitive with all kinds of players competing for the space. The business is also highly tricky and cyclical. Today’s good loans are tomorrow’s bad assets if the cycle reverses.

The Indian policymakers look to resolve financial inclusion with another new kinds of banks – small banks and payment banks. The guidelines were released recently and as is the case with anything in India — enormous hype was generated on how financial inclusion is going to happen etc etc.

It is a different story that none of this is really new after all. India has had many such interventions in the past only to find a dead end after some years and hype of initial launch. This only leads to more and more committees to look at what went wrong and how to keep them going as closing banks is  difficult.

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How a monster was born 100 years ago — Federal Reserve..

December 1, 2014

David Howden of Mises has this hard hitting post on Federal Reserve. Fed opened for business 100 years ago and Howden reflects on the history.

He says there are two schools on Fed- one that supports Fed and other against it (as always):

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The birth of the chokers tag for South African cricket team…

December 1, 2014

Cricket World cup is a few days away and cricinfo.com has wonderful articles on cricket history etc once in a while. One such piece was by Daryl Cullinan, former SA cricketer who reflects on how the word chokers tagged onto the SA team. As per him, it started in the classic 1999 Semi final clash against Australia.The word has hung like a Sword of Damocles for the team ever since.

There are certain tragedies which keep repeating in some select areas. In economics, we have Argentina which keeps getting into one tragedy after the other and just fails to get its economics right.

One such instance in cricket is South African cricket team’s inability to win a major cup despite being a strong contender ahead of each competition. Actually they have won just one major competition – ICC Champions Trophy in 1998, which was the inaugural edition of the once in two year event. The word chokers has remained with them for such a long time that it has become a sad part of SA cricket history. So much so, most cricket lovers (or some) would genuinely wish the team wins given its performance off these events.

So what does Cullinan say?

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From Plannning Commission to Neeti Aayog

December 1, 2014

The more things change the more they remain the same. Infact, those who consider themselves as harbinger of change are most of the time recycling old ideas.

As per this news from BS, Planning Com (Yojana Aayog) is to give way to Neeti Aayog (Policy Commission):

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