Tuesday, October 2, 2012

and they say Inflation is good...


Woke up on a lazy working day with a copy of mint in my hand and  eyes still half closed searching for my specs.. Much needed hike in diesel prices it reads and I thought,  finally the government seems to be waking.. the fiscal deficit might come slightly under control, might send a positive signal to the market..

After a few days I met Dinesh, a skilled painter with bony physique,  who was finishing the final coat of our drawing room ..how is it going I asked him and he looked too busy with his job not really interested in answering any thing. After 5 minutes he comes to me with his clothes spotted with drops of paint and shoulders drooping with the toil of the whole day work and explains, " the price for cooking gas has become 100 Rs/ kg now, price of wheat floor has increased by 5 Rs a kg. My room rent which I share with 3 other inmates has increased from Rs 1500 to 2000 , I am finding it very difficult to sustain here in this city, sending money back home seems to be impossible, I  don't know where to go and how to survive "

I thought to myself, " Dinesh's monthly earnings must be close to Rs 4000 as he was being paid 200 Rs a day by the contractor, All is not so well in India after all ".

Was the diesel price hike the only way to control fiscal deficit, why not put additional duty on the prices of diesel cars? Whenever I see people buying diesel cars the thought hits me, this car is going to consume gallons of fuel subsidized at the cost of people like Dinesh. the thought comes and go and I get busy in other consuming thoughts ..


 

Is it worst than 2008


The world is seeing massive turbulence, European economies are struggling to repay their debt, USA is yet to recover from 2008 recession and is struggling to create employment, Chinese economy seems to be finally cooling off and India too looks to in a state of confusion.

The question which is haunting the economist currently is that  ongoing crisis will lead to even a far bigger crisis ?