Some food for thought
"It is a queer thing, but
imaginary troubles are harder to bear than actual ones."
—Dorothy Dix (American
Journalist, 1861-1951)
Word for the day
Gallinaceous (adj)
Pertaining to or resembling the domestic fowls.
First random thought this morning
The sight of large garbage dumps, overflowing garbage
containers, walls & signage colored with red spits, etc are common in states
like Uttar Pradesh, Bihar, West Bengal, Delhi and Haryana, etc. In fact these
are so common that most residents of these cities would even not take an
exception to this. This is accepted as an integral part of their life.
Dirtiness in India is not only a problem of resources, logistics or habits. It
is as much a problem of mindset and consciousness. The impact of the National
Cleanliness Mission must be assessed keeping this in mind.
I consider the following as decent progress on this account, and
accept this as a personal success of the prime minister himself.
- There is an emphasis on cleanliness at administration level.
- State is making effort to create awareness about the benefits of cleanliness.
- A separate head of resource allocation has been created in budgets of central government as well as many state governments.
- Some shift in mindset is clearly visible, especially in urban middle class people. Even if they indulge in littering and spitting, it is not without guilt. Many of them in fact do make effort not to be seen.
Of course, there is a long way to go, but a decent beginning has
been made. Thing may not change dramatically in short time, but things have
started to move in right direction for sure.
Missing elephant in the room
The global growth cycle that started a few years back has almost
peaked. Two large economies, viz., Japan and Germany, have already reported
contraction in the quarter ended September 2018. US and China growth also
distinctly indicated a slowdown.
Commodity prices have been volatile this year, but of late many
commodities have shown a distinct weakness in price trends.
Inversion in yield curve is commonly seen as harbinger of
slowdown. Many economists and analysts track the spread between US Fed fund
rates and long term (30yr) yields to forecast recessionary phases. As per
Bloomberg data highlighted by some analysts, we now have 11 large economies
with 30-year yields lower than the fed funds rate. South Korea just joined the
pack last month.
Some analysts have highlighted that the global economy might be
close to a liquidity crunch, as indicated by the collapsing global yield curve.
The global economy is already experiencing some deflationary
pressures, due primarily to (a) persistently poor real wage growth; (b) absence
of capital expenditure in capacity building; and to some extent (c) winding
down of monetary stimulus created in the aftermath of global financial crisis
during 2008-09.
The economics history suggests that deflation is much bigger
malice than the inflation, especially for the growing economies like India.
It's a silent killer like low blood pressure.
In this background the debate over inflation in India seems bit
out of place. Unfortunately, most of the politicians here do not seem to
understand the basic difference in prices of goods and services and (rate of)
annual inflation in these prices.
The prevailing price of fresh green peas (a seasonal vegetable)
in the local markets (not air conditioned malls) in Delhi NCR is about
Rs150/kg. Whereas, the rate of annual vegetable inflation in October 2018 was
recorded as negative 8%. Overall Food inflation was also marginally negative.
The worry is not price change relative to last year. The real problem is the
absolute level of price of essential goods that is becoming unaffordable. More
on this tomorrow.
