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Nobel Laureate Abhijeet Banerjee has recently asked India to print more money and transfer them to the poor class of people to increase demand in the market to tackle upcoming recession post COVID-19.

Reference: https://m.telegraphindia.com/business/abhijit-banerjee-offers-print-money-pill/cid/1763262

A lot of economists will say it is a bad idea because later it will become very difficult to arrest inflation rate. But increasing the demand is a major challenge as well.

Voice your opinion! Will be good or bad step for a diverse country like India?

Unfortunately we are right now seeing the worst performance of Indian rupee , but at the same time it is the same situation all around , unfortunately I do not understand why this suggestion appeared when the government could have just change the financial needs of the various sectors and for a while they should stop focusing on other countries and start focusing on their country.
Export of the drugs is very necessary but at the same time other expenses should be cut short .
All the government money should be used for the people , printing more money is not a solution when they can already reevaluate their spendings and create a slot .

It would hit the country harder if the economic situation declines , how about hitting people with corruption and documenting each and every penny that is being used ?

Its happening in affected countries though and it helped the people during the lockdown. Its not a bad idea as it had been done many times before. If the surrounding countries are printing money to find solution for the crisis, it should be considered. First world countries are even printing more. There are consequences to the action but its very needed for the economy.

For what I can see the solution being proposed here is in fact supported by the mainstream economists all around the world, they want governments to get indebted or to print money to drive up the demand of goods and curb the recession and prevent a depression from happening, as you may guess I do no like those measures however if the world economy was robust and in decent shape maybe some measures like that could be taken but that is not the case, most governments are heavily indebted already and were printing too much money anyway, if they were to increase both now there is a possibility they could lose control of the economy and the inflation rate could grow to huge levels.

Advising countries not to worry with printing too much money is actually a good advice. /s/

The global economy is currently at a halt right now and is in a bad shape. No demand can be pulled off of all pockets except on the food and medical industries. The rest are basically non-essential and does not matter at this point. If every country is to print money to satisfy the welfare of their citizens, expect that inflation will skyrocket, and more and more people will be affected short-term. This is practically telling countries to jump off the ledge and expect for the best, however we know what happens if the advice is followed.

Most countries would surely have their budget intact still for 2020. We're only at the first full quarter of the year and I'm pretty sure governments can re-allocate the budget into emergency funds first and decrease spending on infrastructure and other key areas in the mean time as the most important part of this pandemic is to help keep citizens alive and well. Printing more money should be the last resort, not the first solution that comes into political advisers' mind--be they Nobel laureate or simple economists.

it depends: do you want stability or revolution?

the lockdowns are hardest on the poorest populations, who have no savings, live in overcrowded slum conditions, and are worst equipped for a complete economic stoppage. if this continues for months and nothing is done to mitigate their suffering, they will begin rioting and revolting and taking by force what they need to survive. with a population like india's, no police or armies could ever stop them.

the question for policymakers is, do you want millions and millions of hungry poor rioting in the streets (which will also make the pandemic grow exponentially as society stops heeding social distancing and quarantines)? or do you want stability at the cost of future inflation?

if i were a policymaker trying to maintain the rule of law, the answer seems obvious.

The economy is struggling for a long time and different sectors were affected well before the lock down and in order to overcome the recession if they are printing more money then how they will control the flow of money and how they will be withdrawing the money at a later time, countries like the US and Europe are struggling to withdraw the money they printed earlier and how India will be able to achieve the impossible. The current government has already sold all the public ventures to private parties and i wonder what will be the situation in the next 5 years.

It is a situation that these third world countries need to think while implementing a complete lock down, people will revolt against these lock down as they do not have money nor food and it will create a social violence and the crime starts to increase and if that happens then it will be difficult for the authorities to control the situation and to avoid those they need to act and printing money or providing food is a necessary.

Many people think who has thought about printing money must have a guarantee of gold and dollars is an old-fashioned thought in the midst of a chaotic world. According to the new economic model proposed by Professor Michael Hudson that printing money does not need to have a gold or dollar collateral, what is important is the guarantee productive project.

It's time for India and all countries in the world to use the knowledge used by China and America. Keynesian is too old-fashioned and knowledge for IMF victims countries. Many assume that the knowledge taught in college cannot provide solutions to economic problems and is deliberately spread by capitalists so that they can continue to dominate the world economy. Whereas the capitalists practice another science, namely modern monetary theory.

I would agree. Let tomorrow take care of itself. If there will be an inflation rate too high than what should be considered acceptable as a result of this, then the government and its monetary and economic teams will take care of it at the right time. They will cross the bridge when they get there. For now, the poor people, millions and millions of them are having an empty stomach. They urgently need food on the table!

Damn the torpedoes!

As far as I know, not only the country of India has printed more money even their government knows that for sure of increasing the inflation and would possibly reduce the value of bonds. Probably it will create a problem in the future.

I agree with the decision of the Indian government, they are need to focus on needy by their citizen. There are many people out there that need help by governments through financial in order to buy foods on table that they need while they are under lockdown. I would say, printing money is good but they should have back-up on it by borrowing extra money, financed entirely by RBI and they should not worry about the inflationary consequences. There is always a solution to it, as of now, think the survival of coronavirus.

I definitely agree, I know printing money increases inflation and it would hurt the economy in the long run but the reality is if you do not print money that would mean a bigger problem today. It is definitely like having a huge debt to pay right now that you can't afford so you pay it with a loan from a bank and instead of paying a huge debt right now that you can't even afford anyway and can't pay right now, you are going to just have a worse problem but for longer period of time so you will have time to figure things out.

I am not saying we will, I am not saying it will recover, but at least it gives people a lot more time to find a way to repay it. In the end printing money to give it to banks is horrible, but doing it so to help people would actually help people.

You are correct from one point that a lot of poor people are having empty stomach and something to be done to prevent that, through printing money but if it results high inflation in long run, people will have even more worst situation than the current. Higher inflation can destroy an economy easily. An economy should be planned for future too. If they only consider the current situation, they will have worst day in future of course.

Inflation is a taxation. They are not worried of more taxes. There will be way more taxes in next decades as it was in previous. Governments will impose them on very different ways. Inflation is one of ways.

@avikz it’s quiet difficult to answer this question, but in my personal opinion if the Indian government wants it’s citizens to survive in the long run then they may have to take a risk, and print more money and then deal with any issues that pop up later. @figmentofmyass if we take your hypothetical scenario, and just for a minute imagine that a majority of India’s poor population comes on the road and riots, then India will indeed suffer unimaginable damage and therefore I feel it’s best to pay them some cash and control the situation before it gets out of hand.

I share your thinking, and I don't think there are any solutions that can help at this point, and that on the other hand, does not cause negative consequences in the future. If USA prints money (let's say it has about 4 times less population than India) and a much lower poverty rate then USA, what choice does India then have if they do not want a complete collapse of society and economy?

The idea is not good, but it is said that from two bad things we should always choose one that is at least somewhat better. People have to eat, they need basic things for life - and if you quarantine them for a few months, it's only a matter of time when they rebel and take matters into their own hands.

Although judging by the footage from India, their police have little mercy on people who do not follow the prescribed measures.

https://i.imgur.com/KMVeHWD.jpg (https://www.youtube.com/watch?v=nchRqzcDVzU)

I contradict simply because it's a very risky move, it will be a hard punch for their economy if they insist such thing. In my opinion, printing more money is absolutely a bad idea.

Plus, imagine if their government gave money to each household. Yeah it's nice but do you think they can fully harnessed it since their movement is limited because of the strict quarantine? Of course not thus the help would be inefficient. I think much better if their government just give them relief goods because food is what they badly needed anyway. Another, they could also encourage the families from higher classes and private sectors to run fund raising projects to ease the burden they feel. Remember, a government must spend based on country's economy or else everything will get even worse in the long run.

What I'm only pointing is there are still much better solutions. Sacrificing the growth of their economy must be their last resort.

"Nobel laureate" is the key to comprehending policies pushed by the Paul Krugman and Abhijeet Banerjee's of the world. (See bolded below)



The nobel prize funding and award process is owned, maintained and controlled by banks.

In past eras, the award criteria of nobel prizes was meritocratic.

Today, its more commonly a leftist participation trophy awarded to academics willing to push false narratives and agendas.

Well, other countries have done it in the past^[1], the US has been doing it for awfully long time, and given the state of the world right now, I don't necessarily see this as a bad thing, people need physical cash in their hands, because not everyone can work from home. And if printing more money is the way, they should go ahead and do it.

An inflated economy is better than a non-existent/economy with a fuckton of unhealthy people.

---

^[1]https://www.dw.com/en/what-europes-banks-did-with-the-ecbs-trillion-euros/a-17848344

The feeling I get from India is that the leadership either doesn't know or doesn't care what real life is like for most people. They have their space program. They also have people who live in toilets.

The rescinding of bank notes fucked millions of people. Their lockdown fucked even more. How they didn't figure out that most people live hand to mouth on a daily basis and would face starvation within a few days is beyond me.

That being the case I think the Indian establishment should commit suicide and enrich the real people they're supposed to serve on the way down. Do it. It's not as if day to day life would be much more desperate than it already is.

We are not confronted with good and evil here; we are confronted with evil on both sides. So I guess we will just choose the lesser evil, so to speak. On the one hand, we have the choice to let the hungry, unemployed, home-isolated people take care of themselves while trying to keep the monetary foundation stable, at the same time fighting the spread of the virus. On the other hand, we may resort to drastic means which could be detrimental to the long-term economy and monetary value but could keep the people properly fed and therefore tamed and sane in these very trying times. I definitely prefer the latter. The urgency is on that side.

We cannot talk of preserving the future economy and let the people die of hunger or turn to violence. People are forced to stay inside their homes. They are physically hurt when they go outside. What are they going to eat, then? They cannot just start nimbling their walls. 

Finally, the issue is not whether or not the government will continue printing money out of thin air and commit slow suicide. That is happening all the time. The real issue is whether these money will go to the rich business owners or to the hungry majority.

According to modern monetary theory, what is meant by printing money is not the origin of printing money with a guarantee of thin air like Americans do, but like China does. In China, the renminbi is printed based on layered projects, for example: money printed by country A0, money is channeled to bank A1, money channeled to entrepreneurs A2 and, etc.

All projects in China, although not important as long as it is still beneficial to people's lives, will be funded by the government. With so many productive projects running, it means that the economy is spinning and labor is being absorbed more and more. With so many workers absorbed will improve the economy of a country and of course the economy of lower and middle class.

From the above explanation, it can be concluded that it is not the origin of printing money, because the collaterals are productive projects not fictitious, and the minimum project layered above 6. The money is indeed non-existent but supervision of its use must be very strict and properly monitored because printing money is not allowed to cover the consumption budget or pay the state debt. Another requirement is that all project raw materials must come from within the country, starting from facilities and infrastructure, raw materials, experts and even laborers. And infrastructure or projects built must be export-oriented so they can attract foreign exchange. Therefore licensing in China for business is made easy even China is encouraging its people to make as many projects as possible.

China has even made a leap forward with its BRI program, the location of the project does not have to be in China, it can be throughout the world as long as the raw materials, experts and workers are from China.
This is the model of colonialism 5.0 which is now intensively carried out by China.

All the novel laureate economists are fanatic fiat system supporters and they are constantly preaching about fiscal and monetary stimulus plans,quantitative easing and negative interest rates from the central banks,lower taxes and giving more money to the poor by the governments.Every time a recession happens,they preach the same stuff.They are like doctors,who are trying to cure flu,aids and cancer using only one remedy.
Even if the Indian government gives more money to the poor,they won't spend the money right away,because of the lockdowns.Most of the small "brisk and mortar" businesses are closed.

I totally agree with it! The disparity between the riches and poor class is really eye-popping. The world's costliest house is in India and at the same time, world's biggest slum is also located in In India, in the same city indeed! It happens because India has been rules under bureaucracy since independence for the benefit of politicians where common people have no/little power! I too think the current administration should step down and let the young blood take over the country. Our PM failed us miserably and we are seeing highest number of social unrest due to the hate politics undertaken by the ruling party! It's a shame indeed! 

Well.. being an Indian resident, I know the reasons for this eye-popping income disparity. The governments have repeatedly followed a populist approach, rather than taking concrete actions to remove or reduce the poverty levels. The single-most reason for poverty in India is uncontrolled population explosion, but yet none of the major political parties have the courage to talk about it. There are certain religious groups that refuse to participate in family planning and no one has the will to enforce the policies on them.

I saw a docummentary about life in the poor slums of India. There are whole communities, towns even, that live off segregating trash. Their houses are gull of plastic bags and bottles, they literally sleep on piles of plastic and wake up early every day to bring back more before the busy day starts and the city wakes up. They sleep during the day and work at night and morning to clean up the streets and get paid less than 5 dollars a day.
They have running asbestos factories that mix it with concrete to make roof tiles... They have people dismantling electronics in their back yards, working every day in fumes that kill them before they reach 40. India is crazy poor. Many parts of the country are a tipical third world where people live with farm animals in the same building and spend $1 a day on food because that's all they can spare.

I absolutely agree with this, and, also, I don't think a Nobel Laureate in Economic Sciences could recommend something bad, regarding economy.

I just want to add one point, which may seem controversial, but that's what I think based on my experience. Poor people don't suffer from inflation because they don't have savings, and thus nothing in their possession can be devalued. A daylaborer spends all he earns the same day, or the day after, and if inflation comes, the prices rise and he's paid more for the same job.

The advice from the OP may not be suitable for all countries, but I think it would be a good step for India, where 30% of the total population lives below poverty line, earning less than $1 per day.

If inflation really takes hold then the whole country seizes up and even if you're earning in an effectively inflation free way there might not be anything to buy. Look at supply chains, imports and production in places like Zimbabwe and Venezuela.

I don't know how you moderate it but you'd need to keep a careful eye on it.

In most states in India police are taking strict actions against lock down violators including beating their ass up and giving them silly punishments, i do not support police brutality during this pandemic situation and today there is a terrible news coming from Punjab where people cut off the arm of a police officer when they tried to stop them. People are loosing their minds sitting at home and with brutality like these, its awful.

I do accept that Keynesian concept will not work in 2020, it is an age old concept and it worked well during the great depression but not anymore.

If people violate the lock down, impose heavy fines and take legal actions and if they violate again they should impose jail terms and make sure they understand the gravity of the situation rather than beating people like animals.

Printing more money can have other dimensions too rather than giving money to each household, the government will allow people to loan amounts from banks with much lower interest considering many business lost money during these period and to help them out the government will provide loans, relief fund does not mean printing more money and since the suggestion is given by a Nobel award winning economist i expect some logic in what he meant.

I don't know what the attitude of the Indian police is on a day to day basis, but in the UK the police are asking for cooperation mainly. If they all started chasing people around with sticks I don't think their legitimacy would last too long.

The same thing is going to be done by most other governments as well to tackle demand and supply issue in the economy.But this could be an eye opener for all the people who have been trusting the fiat money issued by the governments which is day by day the value of the money we having is going to get decreased so we need something which cannot be printed anymore like bitcoin.

In India there is no middle class, either you are very rich or so poor that they can't afford drinking water. Printing more money wont solve the problem because India is the country with the second biggest population so there is a need for good social politics, not just printing money.

In Zimbabwe and Venezuela they were printing money, right, but they weren't giving it to the poor, as Abhijeet Banerjee suggested for India. Since this has never been done before, it's unknown how can it affect the economy overall. But most likely it would affect it positively since the suggestion comes from a Nobel Prize winner in Economy.

It won't be "eye opener" since fiat economy is not falling.
It is printing more money, it is inflating as hell, but it is not falling and people's faith will remain

This could be a way for us to look up as to why China had become very successful by the way how they rule their own people. Its always the militarize government that will win in the end and can control the baddest situation could ever happen like riots and chaos. Armed forces are always going to be the best solution to control that even a starving individual will just have to find a solution to feed himself and family instead of raiding someone else storage.

A Nobel prize winner wouldn't probably suggest anything stupid so it could be a possible move that their government could take. It's just, this move would probably require the government of India to closely watch over or maintain constant surveillance to the country's economy. As was said, the ones leading don't probably know what the hell is going on with their country, especially with the poor side, so this may actually be hurtful to them in the long run instead of actually helping. Well, it could help at the start, but really, without the government properly managing literally anything, inflation would probably just a matter of time and would severely impact their economy.

Inflation is the sign of fall and people won't recognize it until they turns out to be hyper inflation but most governments will keep the inflation under the moderate rate so people will have their faith remain but as an individual we have to see that value of fiat is falling and falling years after years.

Printing money is always two sides of this decision, with one of them, it increases inflation and a decrease in real incomes of citizens, on the other, it will provide the demand for goods from the population, and will help businesses that help taxes to the state.

This wouldn't be a good idea. If they want to be like the Zimbabwean dollar with the hyperinflation thing affecting their economy, go right ahead. I think the best move for India is just to ask the private and government companies to help the needy. It's just the same right? Helping them without affecting the economy.

Other than what we have been taught in classes as to the effect of excess money in circulation, a Nobel laureate is surely not some quack or speech writer looking for attention. It must have been from a fully thought out process but that does not mean its right. Zimbabwe to my understanding have tried this model which eventually backfired but situation, economy and time differs which could return a different outcome. Its on government and its policy advisers to think a way through and actually address his fear rather than just discarding his own private suggestion.

Well, these are economic reactions of these coronavirus lockdown:

1. Limited in production and supply being that many non essential sectors are temporarily closedown.
2. Demand is obviously higher than supply- for both essential and non essential goods.
3. The income level of people can't sustain the economy at this state of little or no incoming of income.
4. Printing the rupee and injecting it into the economy will cause a demand-Pulled inflation, a situation were too much money is chasing few goods.

Well, that's not a good monetary policy at this stage of the economy.

If the money to be printed was to be given to the poor as a measure to try to keep the stability of society to avoid riots and the like during these difficult times then it could be considered, however we know that is just an excuse, of all the money that will be printed around the world to try to solve this most of it is not going to be given to the people and instead it is going to be given to the banks and other big businesses deemed too big to fail, this will only help the rich and while the poor may get some short term help, over the long run this will be counterproductive for them as inflation will grow really quickly during the next years.

That is the thing about the printing money and actually having a problem or not having a problem. Now if one nation prints money and others don't, that will cause some inflation inside and we are talking about a big problem for that nation, however if 50 nations prints money that means there will not be an inflation that big since all other nations printed as well, still a problem inside because things will go higher with people having more money but things costing more money as well, but not as big as doing it alone since you can at least use it for global payments as well.

However looks like countries will go for cheap or zero interest rate loans to big companies so that they could both restart the economy and not have to print money as well if they can afford to.

First of all, I never give much importance to these Nobel prize winners. It lost all the credibility, when the prizes were awarded to people such as Barack Obama. Nowadays, Nobel awards are being decided through a lot of political interference. And secondly, the Nobel prize for economics is not being given by the Nobel Committee. It is awarded by Sweden's central bank (Sveriges Riksbank).

Can we just point out one thing here:


This guy not only known in India for being an economist, he works at MIT and has been recognized by the world. Sigh. I'm assuming that India thinks that they can do this b/c no one is spending money now, which means that inflation will probably stay in the realm of 2-3 percent even with more QE (money printing) then usual.

This is what happens with a limitless volume of fiat, they want to destroy the world economy by printing more money. Well when Zimbabwe was printing more money without corresponding export and production to back it up, this lead to a total collapse of their economy leading to hyperinflation.

You have an intelligent point here.
There can't be stability in any economy as there is never a situation of economic equilibrium.

Yes, in regards to exponential growth of the virus and inflation there is need for a tradeoff between the two.

Better still, a stimulus package should be given to people.

This is a bad idea...
the cost to print money is very expensive, it is better if the money/cost to print the money they share with the poor. people generally think that printing money is easy.  :-\

In situations like this the government must act quickly and decisively. It can take months before some rich companies will make up their minds to shell out something to help the needy. And some of them will not do it at all. I think Abhijeet Banerjee suggested a good thing, and of course he's aware of Zimbabwe, Venezuela and similar examples of money printing turning bad, and he knows how prevent that from happening.

No, the advantage so to speak of having almost every country in the world printing money is that your export sector is not going to suffer, a measure that has been known for a long time in order to raise your exports is to weaken your currency so foreigners can buy more of the stuff being produced in your country, and how do you weaken a currency? By printing money of course, however when everyone is doing it then no one gets any advantage in the exports sector, but the internal market will suffer as the price of everything goes up and the salaries stay the same.

Me too I think it is a bad idea to print more money because it will mean so much  money in circulation. This is what causes inflation. If there is more money and India does not have a strong fiscal policy it will mess up the economy and Indians will be the ones to suffer at the end.

There is not enough money in the world to help out the poor if you never did that before to begin with. Would Sweden be capable of helping out everyone including companies and every single person during this time of need?

Well, of course they would be capable of doing that, however they were always a social democracy to begin with and they are quite happy to be like that and they are getting help, now they need bigger but they at least had a base to start working with.

Other nations including India and even the bigger ones like usa or uk do not have that because they are full of politicians who are only thinking with their pockets and not their hearts, so to begin now would be way too late and wouldn't be possible because they spent all the taxes on useless stuff to get more money into their pockets to begin with. Hence why printing money is the solution. Also do not consider all money printing with Zimbabwe, USA has been creating more money out of thin air all the time and nothing really happened to them all that bad.

Print money intended by Laureate mimics the strategy carried out by America in solving its economic problems by printing money, only because the dollar is used as an international currency then the inflation effect is borne by the whole world.

The money-printing policy was also carried out by China with a guarantee of multiple projects. The principle of China as long as there is a project that is productive is not fictitious although it is not very important as long as it is beneficial for the community to be funded by the government. An example is the installation of chips in a tree to measure levels of CO2 and other pollutants. When printing money the project must be layered so that the wheels of the economy spin fast.

It's just that China requires that all raw materials must be made and produced in China (100% made in China) not imported goods, and the workforce must be Chinese people. The project may be worldwide, the value may be fantastic but China will arrange in such a way that Renmimbi will continue to circulate within China but the dollar will enter China. Even when funding infrastructure development in a country within BRI, China also sends its workforce from the level of expert staff to technicians.

Print money made by China is not for consumption, not to pay foreign debt, not for imports but for projects where natural and human resources are in China.

I understand what you are trying to say but it would still affect the economy, probably at a different rate since it would affect the whole world.

So in clarity, it's okay to print money that is going to be used inside the economy of India (since we are talking about India in this topic), and affecting their economy only? Everything goes back to the people of India and back to them, just make sure it would be of help, right?

Not only India, many countries can print their own money as long as they print money with real project guarantees layered with the natural resources and labor they have and without imports from other countries to run the project.

Large population and will soon get a demographic bonus and although many Indians live in poverty, India is a country with advanced technology and even basic education in technology-based India. So that the millennial generation that is synonymous with innovation and change will become the economic power of India. This innovative generation can create practical new ideas to accelerate the economy.

What is blocking India from printing money right now is that India is now a strategic partner of the United States to compete with China in Asia. The United States is now building India as sadly as it did before building the Chinese industry. This could be an opportunity for the rapid development of India as well as a scourge because when there is FDI then they will not want to print money and rely on debt and imports for their development.

So right now, it's best to invest now (by printing money) and believe in the incoming/current generation to bring power to the economy, which is a good idea, and wait for the development of technological advancements. So with all the possible positive things that printing money could bring to everyone, does it still solve the current situation that we are in right now?

I know there are a lot of solutions trying to solve COVID-19, but does this affect it directly? All I could think of is the future impact on the economy.

Okay make more money to the economy

• Give to frontlliners
• More R&D
• Helping the needy

It's still going to affect the economy no matter what but then I guess it's better than having a deflation in this current time, right?

It's a good idea to influence the economy rather than print  All the countries of the earth are browsing a crisis because of COVID-19  to unravel this if the country's economy is trying to reinforce it's an honest step in the long run. this might prevent inflation and increase export investment Helpless people will find a source of income.

Printing more money per se is not that bad. Especially if it is done as an extreme measure to something that is extremely urgent such as what is currently happening to almost all countries. Also, it is being done all around the world. This is not peculiar to India. For as long as it is well-managed, I believe it will do more good than bad.

This is not the only thing that causes inflation. There are so many factors that cause inflation. And, most importantly, inflation is actually not to be fully avoided. It is designed to be there. It should be there, albeit closely managed. 

The choice is in the hands of Indian leaders, using the old Keynesian understanding or copying countries that have chosen to print money to support development and growth without experiencing inflation as did the United States, China, and Japan. Printing money does not always bring inflation as is the case in Japan now instead Japan wants a little inflation but it can't because of a culture of people who love to save and live frugally. Inflation is not always bad as long its not becoming hyperinflation.

In addition to printing money, modern economists monetary theory also sparked the idea of   a sovereign wealth fund (SWF) and a consolidated bottom of the pyramid. For the current conditions, it will be very effective for India to conduct equity crowdfunding as a step to consolidate the bottom of pyramid. With a profit sharing system and with a small investment, each Indian can help each other and work together to produce economic turnover.

India's millennial generation with technology literacy is expected to be an agent of change for the consolidation of the bottom of the pyramid. So far we have always focused on macroeconomics, so we forget that the microeconomic foundation is the most important. To spin the Indian macroeconomic wheels will be very heavy, but each individual can turn the economic wheels of their environment then consumption and income will be stable because money continues to rotate in the real economy sector and because it revolves in the middle and lower classes then very little money is used for the non-real sector.

The problem is that printing money has gone to something we do in extraordinary circumstances to a standard tactic, governments now print a lot of money for no reason at all and now when printing money could be used as a way to stimulate the economy to get off this difficult circumstances they find out this could damage the economy as well, if this crisis last for a lot longer I am not so sure the economic system will survive and probably a big reform will come during the next years.

Yeah, I bet they do. Well, that has always been the downside of fiat, and in the hands of some people with questionable integrity.


Printing money out of thin air is one standard economic stimulus, but it is not everyday that we need it. It is not everyday that we are facing a hard economic struggle. That is basically a drastic measure that is much needed in dire times. Yes, it may hurt the economy in the long run, but that could really be needed in times like these. After all, that economic long-term negative effect could be remedied. In the meantime, the majority of the populace do not have food on the table and are not allowed to work either; that is valid enough reason to print more money.

Exactly. And that is because USD is accepted everywhere(even in North Korea most people would be happy if paid with USD). I think the US could "print out" up to $5 trillion, and no one would notice. India, however, is not in this postilion. So they should do it cautiously, in order to not end up like Zimbabwe. And I think they can do it successfully, if they will follow the Abhijeet Banerjee's advices. The thing is that in countries like Zimbabwe the newly printed money go to the rich as a matter of priority, but Banerjee is suggesting to transfer it to the poor.

When banking institution tells you not worry about money printing then that's the time you should be very worried. Because when they print money their not really making value. They're just stealing value from other units already in circulation to buy stuff like corporate debt, bonds and soon stocks. Look at how most money has loss so much value over time affecting the economy increasing the price of products.

There are levels between being like USA and being like Zimbabwe, if your money doesn't worth anything you could be like Zimbabwe and I realize that but Indian money is not worthless neither, people actually use it around the world for either purchasing something from India, or tourism to go there and vacation (and I think it is an amazing place to visit) and most importantly people give their own money to buy Indian labor from the people and get service in return, which those people turn into Indian fiat and use in their regular lives.

So, India may not be like USA at all, nobody is like USA they are maybe rivaled by only China and nobody else, however that doesn't mean that Indian economy is not strong around the world neither, they are doing pretty fine, not awesome but decent enough.

Is there any other choice right now? Everyone knows how poor country India is (while keeping second place in world's population ranking) and how people live there.
In india there are some tallented programmers and I know it they do 2000$ job for 50-100$ just to live and survive. When you put such country in lockdown, it's another death verdict. At least you can develop immune system against coronavirus but you have no choice when you are left in front of hunger.
So for this reason if they want to still continue lockdown and get rid of excessive death caused by hunger, then they have to print money to just escape now. But what may happen in future... In any way inflation will cause a bad scenario.

India is a country that has a consistent state platform to become a regional power. proven by India to increase its military power and its foreign policy is more inclined towards America. Modi is great at reading opportunities even now India is a strategic partner of the United States. The United States will build India as America did China in the 90s. India will be used as a proxy by the Americans to fight China in Asia.

This opportunity can be exploited by India to overtake corners before the Americans start looking for trouble with India. It could be because usually, initially, China was also a copycat country tracing how America built its dynamic infrastructure first and then the static infrastructure. After that China made modifications and innovations and improvisations. India can imitate Germany which prints money for weapons of war, or imitates China printing money for means of production or imitates Japan printing money to overcome deflation or follow America to print money to perpetuate its dominance.

But sir, if the number of poor class people in India is huge, then the gov must print lots of money! It's not the same as the US if you look at the poverty rate and financial strength.

Moreover, money should be used to move the economy by giving incentives to businesses and tax holidays, not for charity purposes.

India will be next to turn on the money printer. In a televised address tonight, Modi announced a $266 billion stimulus package.

He said the plan would be unveiled by his finance minister in the next few days. Not many details are available yet on either the funding or spending side, but economists expect it'll be paid for with bond issuance, direct overseas borrowing, and RBI spending. That means a weaker rupee.

https://www.ft.com/content/5734f333-e4d7-4ebf-9de2-220e537da3f0

Ideas and pressures for printing money are not only happening in India but this discourse is also being debated in Indonesia. Between the two camps, the technocrats were chaired by the Minister of Finance and the camp of politicians. But the final decision remains with the President, which is printing project-based money or printing money by issuing bonds.

Pro technocrats means there are political consequences that arise such as coalition splits and loss of political support for the president whereas if winning the camp of politicians there is a possibility that a country will lose the trust of the international world even the Minister of Finance can resign.

I would say it is a good step for most countries out there.
Because what does govs by printing more money is actually taking away some value from every money out there a little bit and then give this whole amount to some certain type of people.
In case of US it is an adequate decision to give 'em out to literally every US citizen just because there are foreign holders out there who will suffer the most.
In case of India it is a good decision because if they're going to give out to poor class of people then the rich people are going to suffer (which is not that big of deal - they're going to get their money back from their businesses after surge in demand)