Who are we to curse central bank?

[BTCIndia]

Do you even remember any time before "Bitcoin Propoganda" you stop for a minute to think, understand and criticize about functions and effectiveness of Central Bank?

Please take time to read statement from Governor printed on currency.

If you're thinking to check note then, you don't have right to criticize central bank because you were never aware of currency. godamn! Of course, now you're aware because "they" made you focused on some problem. Allow me to focus you on other problem--sitting too much time in front of computer screen.

Our brain is trained to see what we want to see. Best marketing is one based on fear, dude!

I dare to defend yourself with argument as you'll are active proponent of Bitcoin and never miss chance criticize Central Bank.

[polynesia]

Do you even remember any time before "Bitcoin Propoganda" you stop for a minute to think, understand and criticize about functions and effectiveness Central Bank? Please take time to read statement from Governor printed on currency. If you're thinking to check note then, you don't have right to criticize central bank because you were never aware of currency. godamn! Of course, now you're aware because "they" made you focused on some problem. Allow me to focus you on other problem--sitting too much time in front of computer screen.

Our brain is trained to see what we want to see. Best marketing is one based on fear, dude!

I dare to defend yourself with argument as you'll are active proponent of Bitcoin and never miss chance criticize Central Bank.

Long, long before Bitcoin existed, we have criticized the government and the central bank for inflation.
Inflation has been a real problem in India, touching double digits as time.
Although the RBI governors have demonstrated reasonable independence, they seem to buckle to the Finance Minister's call "Cut Interest Rates, Help the Economy Grow".

[Fernandez]

I don't understand any economics, but I feel RBI has done a reasonable job. Our banks are quite healthy, and we were spared much of the banking crisis. At least the bankers here are nothing like the gang over there in the west who are openly looting the citizens.

[BTCIndia]

Do you even remember any time before "Bitcoin Propoganda" you stop for a minute to think, understand and criticize about functions and effectiveness Central Bank? Please take time to read statement from Governor printed on currency. If you're thinking to check note then, you don't have right to criticize central bank because you were never aware of currency. godamn! Of course, now you're aware because "they" made you focused on some problem. Allow me to focus you on other problem--sitting too much time in front of computer screen.

Our brain is trained to see what we want to see. Best marketing is one based on fear, dude!

I dare to defend yourself with argument as you'll are active proponent of Bitcoin and never miss chance criticize Central Bank.

Long, long before Bitcoin existed, we have criticized the government and the central bank for inflation.
Inflation has been a real problem in India, touching double digits as time.
Although the RBI governors have demonstrated reasonable independence, they seem to buckle to the Finance Minister's call "Cut Interest Rates, Help the Economy Grow".

You're absolutely right about inflation and other mis-management done by RBI or other hand do you have slightest idea about complexity of managing money where more than 1 billion people exists? Think it for some time. Inflation is not just some "measure" which moves up and down when money in injected or sucked out of economy. Its more than that: http://fas.org/sgp/crs/misc/RL30344.pdf

[BTCIndia]

I don't understand any economics, but I feel RBI has done a reasonable job. Our banks are quite healthy, and we were spared much of the banking crisis. At least the bankers here are nothing like the gang over there in the west who are openly looting the citizens.

When we compare our Central Bank with other central banks then, I feel really satisfied with their performance of managing economy and money. Of Course, they fuck up once or twice being statutory body always under pressure from politicians with vested interest. Beautiful thing, in spite of so much political influence and limitations of power, our central bank has performed better than other developed countries. Even better than People's Bank of China who are struggling with property bubble, Brazil trying to curb hot money and Argentina suffering from excessive inflation which might surge above head any time.

[polynesia]

I don't understand any economics, but I feel RBI has done a reasonable job. Our banks are quite healthy, and we were spared much of the banking crisis. At least the bankers here are nothing like the gang over there in the west who are openly looting the citizens.

The RBI has done a reasonable job, as far as protecting the economy from external shocks and overall monetary policy is concerned.
I feel one area that it has failed is in protecting banks (PSU/cooperative) from being run down by politicians. The RBI should have displayed more spine and been proactive in such cases.

Incidents like this should be more common
http://www.livemint.com/Politics/GSrHywfnohoGyZC3PmLffL/RBI-dissolves-Maharashtra-state-coop-bank-board.html
 

[BTCIndia]

I don't understand any economics, but I feel RBI has done a reasonable job. Our banks are quite healthy, and we were spared much of the banking crisis. At least the bankers here are nothing like the gang over there in the west who are openly looting the citizens.

The RBI has done a reasonable job, as far as protecting the economy from external shocks and overall monetary policy is concerned.
I feel one area that it has failed is in protecting banks (PSU/cooperative) from being run down by politicians. The RBI should have displayed more spine and been proactive in such cases.

Incidents like this should be more common
http://www.livemint.com/Politics/GSrHywfnohoGyZC3PmLffL/RBI-dissolves-Maharashtra-state-coop-bank-board.html
 

PSU is being played by Disivenstement Department who is under political pressure to sale enterprises because of one or other reason that I wasn't able to digest.

And Cooperative Bank are not bank exactly as you think. Its more of hybrid between bank and business with USP of social good. More will be failing in future as important decision are with people who are elected by election and they're more corrupt than politicians. I know a guy from Indira Cooperative Bank who once held prominent position in bank and has crores of assets now.

The RBI should have displayed more spine and been proactive in such cases.
 

I'll definitely talk to Raghuram Rajan about his forgotten responsibility. Thanks!

Many ATM's are plundered and stolen does that mean-RBI should have displayed more spine and been proactive in such cases. They should have been! After all ATM's are established with sole permission from RBI.

[polynesia]

I'll definitely talk to Raghuram Rajan about his forgotten responsibility. Thanks!

You should definitely do that!! But then again, he might decide not to humour you.

Many ATM's are plundered and stolen does that mean-RBI should have displayed more spine and been proactive in such cases. They should have been! After all ATM's are established with sole permission from RBI.

Amazing reasoning. You compare ATM theft with failed banks? Even for an exaggerated comparison, that makes absolutely no sense.
Ever heard of systemic risk and what the RBI's actual responsibilities are?

[BTCIndia]

I'll definitely talk to Raghuram Rajan about his forgotten responsibility. Thanks!

You should definitely do that!! But then again, he might decide not to humour you.

I'm not afraid of being made humour of or disliked. You've to wrong before you're right. And by the way, that was sarcasm, for your 'conclusion' that, RBI should have displayed more spine and been proactive in such cases.

So easily said by someone who doesn't even understand cooperative bank and how it is sanctioned and works. For your kind information, that was pretty good move to dismantle State Cooperative Bank knowing their performances and tangent they were moving. Problem can be identified by anyone, what matter is solution you suggest or attemp. There is so much corruption and equality in India, government should do something about it...blah blah blah.Typical Indian attitude!

SOLUTION. or at least attempt for solution.

Focus energy on SOLUTION, man. Not problem. They can be identified by anyone, even my driver comes up with amazing criticism. Its solution which makes difference between him and me.

I compared ATM with not failed banks but "cooperative banks"...C.O.O.P.E.R.A.T.I.V.E  B.A.N.K.S there is hell lot of difference between 'bank' and 'cooperative bank'. Educated yourself to better understand analogy used!

"Systemic Risk" is very subjective which engulfs number of other risks collectively. It would be much better you can point of some specific risk management rather than dragging me into debate of 'systemic risk' and RBI responsibilities are something I've well aware of. I try to stay updated, but there is always knowledge lag.

[polynesia]

And Cooperative Bank are not bank exactly. 

...C.O.O.P.E.R.A.T.I.V.E  B.A.N.K.S there is hell lot of difference between 'bank' and 'cooperative bank'.

I think you should get your terminology straight.
Cooperative banks are definitely banks.
A cooperative bank is a type of bank, where the owners and the customers are the same. So the motives might not be the same as that of a commercial bank (i.e. maximise profits). That doesn't mean that cooperative banks are not banks.

[BTCIndia]

And Cooperative Bank are not bank exactly.  

...C.O.O.P.E.R.A.T.I.V.E  B.A.N.K.S there is hell lot of difference between 'bank' and 'cooperative bank'.

I think you should get your terminology straight.
Cooperative banks are definitely banks.
A cooperative bank is a type of bank, where the owners and the customers are the same. So the motives might not be the same as that of a commercial bank (i.e. maximise profits). That doesn't mean that cooperative banks are not banks.

OMG! I didn't say cooperative banks are not banks. Okay? Please take time to read those message carefully again. If you've trbouble comprehending sentences then bellow pictures will clearly explain you.

http://s29.postimg.org/lq5cwk86f/Banks_in_India.png

Next Image:

http://s23.postimg.org/99itmtfuj/bank_1.jpg

The biggest problem facing co-operative banks is the they have more than one master — in the case of UCBs, you have the RBI and the Registrar of Co-operative Societies (RCS) of the respective state and in the case of the district and state co-operative banks, you have Nabard, the RBI and the RCS.Given the close links between politicians and co-operatives and the fact that the RCS functions under the state government, in practice this dual or triple custody of the health of co-operative banks has, in practice, led to poor supervision and control. Also most co-operative banks are lacking in skill/expertise.

Recruitments are politicised as are appointments at most levels. Income recognition and prudential norms that were introduced for commercial banks in the early 90s were also not extended to the co-operative sector.

Source:http://articles.economictimes.indiatimes.com/2002-05-13/news/27357297_1_cooperative-bank-ucbs-banking-regulation-act

Suggested Read: http://shodhganga.inflibnet.ac.in/bitstream/10603/2031/11/11_chapter%202.pdf

The RBI should have displayed more spine and been proactive in such cases.

Recent Activity: http://www.livemint.com/Opinion/fGmd3fJ0kILX7L1CExXMGI/How-safe-is-your-money-with-Coop-banks.html

Incidents like this should be more common
http://www.livemint.com/Politics/GSrHywfnohoGyZC3PmLffL/RBI-dissolves-Maharashtra-state-coop-bank-board.html

P.S. : That News which you provided to back your argument was published in 2011. And this is year 2014.


I solemnly accept that blood banks are banks. We should definitely apply conventional banking definition on these banks too.  

[BTCIndia]

Any mood to discuss issue of systemic risk raised?
Yes or No. Who cares?
Cuz I don't fee like as there is no common floor of common knowledge to have sensible discussion. May be few years later we can have. Oops! How can I ignore my learning.

Sorry! Never in future!

[polynesia]

And Cooperative Bank are not bank exactly.

...C.O.O.P.E.R.A.T.I.V.E  B.A.N.K.S there is hell lot of difference between 'bank' and 'cooperative bank'.

OMG! I didn't say cooperative banks are not banks.

Okay. I think I didn't get through to you. Let me try to show you how your different statements sound
1) And cats are not animals exactly
2) There is hell lot of difference between cat and animal
3) OMG! I didn't say cats are not animals.

As you can see, there are inconsistencies and that is why I tried to correct your terminology.

Okay? Please take time to read those message carefully again. If you've trbouble comprehending sentences then bellow pictures will clearly explain you.

I am sorry, but no matter how much time I spend reading your messages, it is going to look the same to me. I suggest you spend more time framing your sentences.


This shows that your understanding is not all that off. Congratulations.

The biggest problem facing co-operative banks is the they have more than one master — in the case of UCBs, you have the RBI and the Registrar of Co-operative Societies (RCS) of the respective state and in the case of the district and state co-operative banks, you have Nabard, the RBI and the RCS.Given the close links between politicians and co-operatives and the fact that the RCS functions under the state government, in practice this dual or triple custody of the health of co-operative banks has, in practice, led to poor supervision and control. Also most co-operative banks are lacking in skill/expertise.
Recruitments are politicised as are appointments at most levels. Income recognition and prudential norms that were introduced for commercial banks in the early 90s were also not extended to the co-operative sector.

Of course, which is why problems are more in cooperative banks. So your point is....?

Recent Activity: http://www.livemint.com/Opinion/fGmd3fJ0kILX7L1CExXMGI/How-safe-is-your-money-with-Coop-banks.html

Incidents like this should be more common
http://www.livemint.com/Politics/GSrHywfnohoGyZC3PmLffL/RBI-dissolves-Maharashtra-state-coop-bank-board.html

P.S. : That News which you provided to back your argument was published in 2011. And this is year 2014.

How is the year of the article even relevant? If you had the time to read that article, you would have realized that the RBI had dismissed the Board of a bank controlled by the sitting Deputy CM, Ajit Pawar. It did this when the Congress-NCP coalition was in power both in the state of Maharashtra and in the Union Government. This shows that they did act fearlessly and I lauded them for their actions.

Of course, I agree that the link you posted about Amanath Co-operative Bank is more recent.

I solemnly accept that blood banks are banks. We should definitely apply conventional banking definition on these banks too.  

There you go again. Making unrelated statements. Personally, I think going off on tangents and making unrelated comments reflects inability to come up with logical and cogent arguments.

[BTCIndia]

http://www.google.co.in/imgres?imgurl=http%3A%2F%2Frt.com%2Ffiles%2Fnews%2F32%2F14%2Fb0%2F00%2F1-a-1.jpg&imgrefurl=http%3A%2F%2Frt.com%2Fnews%2F205131-australia-heads-climate-change%2F&h=460&w=690&tbnid=khQIazQNQgXtdM%3A&zoom=1&docid=pPlN6cYT1mb4ZM&ei=eppwVI-PM8GeugSt0oCQCw&tbm=isch&ved=0CB4QMygEMAQ&iact=rc&uact=3&dur=3377&page=1&start=0&ndsp=12

Incidents like this should be more common
http://www.livemint.com/Politics/GSrHywfnohoGyZC3PmLffL/RBI-dissolves-Maharashtra-state-coop-bank-board.html

1. I feel guilty as I misinterpreted "Incidents like this should be more common" in negative connotation.

2. I should have not rushed with venn diagram of banks they've many mistakes. But, I'd like to justify those because, I was focued on another picture sent to explain analogy used--ATM comparision with co-operative banks. Other pictures was much more important therefore, I din't work much on first picture. Mistake is mistake! Sincere apologies!

I solemnly accept that blood banks are banks. We should definitely apply conventional banking definition on these banks too.

That was sarcasm! Not attempt to another tangent.

[polynesia]

"Systemic Risk" is very subjective which engulfs number of other risks collectively. It would be much better you can point of some specific risk management rather than dragging me into debate of 'systemic risk' and RBI responsibilities are something I've well aware of. I try to stay updated, but there is always knowledge lag.

I think you are confusing systemic risk and systematic risk.
Wikipedia isn't usually the most reliable source of information, but in this case it will suffice.

http://en.wikipedia.org/wiki/Systematic_risk
http://en.wikipedia.org/wiki/Systemic_risk

Systemic risk is what differentiates the risks (to the broader economy) of a bank going bankrupt and the risks of a normal company going bankrupt. My limited point was that the RBI has the power to dismiss the board of any bank. In case a bank goes down (due to whatever reason - corruption, political interference, etc), it has implications for the broader economy.

[BTCIndia]

"Systemic Risk" is very subjective which engulfs number of other risks collectively. It would be much better you can point of some specific risk management rather than dragging me into debate of 'systemic risk' and RBI responsibilities are something I've well aware of. I try to stay updated, but there is always knowledge lag.

I think you are confusing systemic risk and systematic risk.
Wikipedia isn't usually the most reliable source of information, but in this case it will suffice.

http://en.wikipedia.org/wiki/Systematic_risk
http://en.wikipedia.org/wiki/Systemic_risk

Systemic risk is what differentiates the risks (to the broader economy) of a bank going bankrupt and the risks of a normal company going bankrupt. My limited point was that the RBI has the power to dismiss the board of any bank. In case a bank goes down (due to whatever reason - corruption, political interference, etc), it has implications for the broader economy.

My attention was focused on systemic risk.
We've consensus on above statement.