Monday, November 17, 2008

Citigroup to slash 52,000 jobs, sees hard 2009

Enlarge Photo People walk past a Citibank branch in New York February 17, 2007. Citigroup Inc revealed...
Tue, Nov 18 01:14 AM
By Jonathan Stempel and Dan Wilchins

NEW YORK (Reuters) - Citigroup Inc revealed plans to cut 52,000 jobs by early next year in a dramatic move to restore the No. 2 U.S. bank to health as it combats mounting debt losses and sagging economies worldwide.
The cuts announced by Chief Executive Vikram Pandit on Monday affect 15 percent of Citigroup's workforce, and are in addition to 23,000 jobs eliminated between January and September.
Citigroup plans to slash expenses by as much as 20 percent, and spend a total of $50 billion to $52 billion in 2009. That compares with $61.9 billion over the last four quarters.
The cuts will be global, affecting many regions and business lines, including the retail and investment banks, a person close to the matter said. About one-half will come from layoffs and attrition, and the rest from the sale of units, such as the German retail banking business.
Pandit became Citigroup's chief executive last December, and has faced much criticism from investors and others for failing to implement a workable turnaround plan. The New York-based bank has lost $20.3 billion in the last year, and some analysts do not expect it to make money before 2010.
"As the economy continues to weaken they will have greater credit losses," said Michael Holland, founder of money manager Holland & Co in New York. "Cuts will lessen the losses, but they in no way guarantee profitability."
Pandit told employees in a memo that Citigroup has spent the last year "getting fit," and projects a "difficult" 2009 for clients and customers.
Citigroup's latest cuts are the most by any U.S. company since the global credit crisis began last year. They are also the second most ever, trailing the 60,000 that International Business Machines Corp announced in 1993, according to outplacement firm Challenger, Gray & Christmas Inc.
The latest cuts would leave Citigroup with about 300,000 employees, down 20 percent from the end of 2007 and about the same number it had at the end of 2005. People at the bank said the cuts should be made by the first couple of months of 2009.
Shares of Citigroup, a component of the Dow Jones industrial average, fell 19 cents, or 2 percent, to $9.33 in afternoon trading on the New York Stock Exchange.
Last week, Citigroup stock fell into the single digits for the first time since Sanford "Sandy" Weill created the bank in 1998 from the merger of Travelers Group Inc and Citicorp.
Well over 100,000 jobs have been lost at the world's largest banks and brokerages since the global credit crisis began. In the last month, Goldman Sachs Group Inc began cutting 3,200 jobs, and Morgan Stanley said it will cut 10 percent of jobs in the unit housing its investment bank.
Citigroup said it has a "very strong" capital position, and according to the person close to the matter has no need to further cut its dividend, which has already been reduced twice this year.
Still, many investors remain wary. Through Friday, the bank's stock was down 68 percent this year, leaving Citigroup with a market value of $51.9 billion.
That's barely twice the $25 billion of capital it received from the U.S. Treasury Department's bank bailout plan, and down from more than $270 billion in late 2006.
"We have a bull market in fear," said Henry Asher, president of Northstar Group Inc in New York.
Citigroup also said its board will make decisions on executive compensation after Dec. 31.
That prompted criticism from New York Attorney General Andrew Cuomo, who urged the bank to follow Goldman's decision on Sunday not to pay bonuses to top executives this year.
"It seems only fair that top executives should shoulder their fair share of these difficult economic times," Cuomo said. "It would send exactly the wrong message for Citigroup's top brass to collect bonuses while investors, taxpayers and now Citigroup's own employees suffer."
Citigroup was built principally by Weill, who ceded control to Pandit's predecessor, Charles Prince, in 2003. Analysts have said Citigroup never invested enough in technology or to make the bank's various parts work well together.
Its geographic diversity, including operations in more than 100 countries, is now also working against it as customers in such countries as Brazil, India and Mexico find it harder to stay current on payments.
At the same time, Citigroup's ability to grow at home is relatively limited. Last month, Wells Fargo & Co derailed Citigroup's attempt to buy Wachovia Corp and its $418.8 billion in deposits.
The bank has tried to downplay reports of dissension among directors regarding the performance of Pandit and the bank's chairman, Sir Win Bischoff. Last week, lead director Richard Parsons said the board supported management's plans.

Sunday, September 21, 2008

Q&A: The Wall Street bailout plan
By David Stout
Published: September 21, 2008

WASHINGTON: News reports about the upheaval in the world of finance have been full of esoteric terms like "mortgage-backed securities" and "credit-default swaps," but the crisis has resonated for people who know little about Wall Street and who did not think they would ever have to know.

Here are several questions and answers of concern to people outside the financial world:
Q. The bailout program being negotiated by the Bush administration and congressional leaders calls for the government to spend up to $700 billion to buy distressed mortgages. How did the politicians come up with that number, and could it go higher?
A. The recovery package cannot go higher than $700 billion without additional legislation. As for that figure, it lies between the optimistic estimate of $500 billion and the pessimistic guess of $1 trillion about the cost of fixing the financial mess. But the $700 billion is in addition to an $85 billion agreement on a bailout of the insurance giant American International Group, plus $29 billion in support that the government pledged in the marriage of Bear Stearns and JPMorgan Chase. On top of all that, the Congressional Budget Office says the U.S. government bailout of the mortgage finance companies Fannie Mae and Freddie Mac could cost $25 billion.

Q. Who, really, is going to come up with the $700 billion?
A. American taxpayers will come up with the money, although if you are bullish on the United States in the long run, there is reason to hope that the tab will be less than $700 billion. After the Treasury buys up those troubled mortgages, it will try to resell them to investors. The Treasury's involvement in the crisis and the speed with which Congress is responding could generate long-range optimism and raise the value of those mortgages, although it is impossible to say by how much.

Today in Business with Reuters
Global banks expect to fall under U. S. bailout umbrella
U.S. financial rescue plan appears headed for approval
Will the bailout work?

So it would not be correct to think of the U.S. government as simply writing a check for $700 billion. It is just committing itself to spend that much, if necessary. But the bottom line is, yes, this bailout could cost American taxpayers a lot of money.

Q. So is it fair to say that Americans who are neither rich nor reckless are being asked to rescue people who are? What is in this package for responsible homeowners of modest means who might be forced out of their homes, perhaps for reasons beyond their control?
A. Yes, you could argue that people who cannot tell soybean futures from puts, calls and options are being asked to clean up the costly mess left by Wall Street. To make the bailout palatable to the public, it is being described as far better than inaction, which administration officials and members of Congress say could imperil the retirement savings and other investments of Americans who are anything but rich.

But it is a good bet that the negotiations between the administration and Capitol Hill will include ideas about ways to help middle-class homeowners avoid foreclosure and perhaps some limits on pay for executives. And it should be noted that neither party is solely responsible for whatever neglect led the country to the brink of disaster.

Q. How is it that the administration and Congress, which have not tried to find huge amounts of money to, say, improve the U.S. health insurance system or repair bridges and tunnels, can now be ready to come up with $700 billion to rescue the financial system? And is it realistic to think that the parties can reach agreement and get legislation passed in a hurry?
A. The first question will surely come up again, involving as it does not just issues of spending policy but also more profound questions about national aspirations. As for rescuing the financial system, elected officials in both parties became convinced that, while a couple of venerable investment banks could fade into oblivion or be absorbed by mergers, the entire financial system could not be allowed to collapse.

And, yes, the parties are likely to reach an accord. Many members of Congress are eager to leave Washington to go home and campaign for the November elections, and no one wants to face the voters without having done something to protect modest savings portfolios as well as giant investors.

Stephen Labaton and David M. Herszenhorn contributed reporting.



Thursday, June 12, 2008

Sunday, April 6, 2008

G8 development ministers call for food price steps

Enlarge Photo Loaves of bread sit ready for sale on the shelves of a Wal-Mart store in...
Sun, Apr 6 06:25 PM
By Yoko Nishikawa

TOKYO (Reuters) - Development ministers from the world's rich nations on Sunday called for action to confront soaring food prices, which they say hurt developing nations as well as donors' efforts to help them.
Ministers from the Group of Eight (G8) industrialised nations said development assistance needed to be strengthened and partnership between traditional donors and new donors, such as emerging Asian countries, increased.
But rising food prices, which were not on the official agenda for the meeting and partly for that reason did not make it into the chair's summary statement, became a hot topic on the second day of the two-day meeting in Tokyo.
"Spikes in food prices cause serious problems for development as a whole, especially for Africa, and we shared the view that this is something the international community needs to tackle," Japanese Foreign Minister Masahiko Komura, who chaired the meeting, told a joint news conference by the G8 ministers.
"The problem of food will directly hit lives of poor people. We reached a common determination that there is the need to take necessary steps," he added, without specifying details.
Earlier this month, World Bank President Robert Zoellick called for a new coordinated global response to deal with spiralling food prices exacerbating shortages, hunger and malnutrition around the globe.
Severe weather in producing countries and a boom in demand from fast-developing countries have pushed up prices of staple foods by 80 percent since 2005. Last month, rice prices hit a 19-year high; wheat prices rose to a 28-year high and almost twice the average price of the last 25 years, Zoellick added.
Alain Joyandet, France's secretary of state for cooperation and French-speaking countries, told the G8 news conference France was concerned about the rising cost of food, which he said could affect donors' aid programmes.
Some Asian countries that attended "outreach meetings" with the ministers from Britain, Canada, France, Germany, Italy, Japan, the United States and Russia on the sideline said problems of rising food prices should be taken up at a G8 summit on July 7-9 in Japan, a Japanese Foreign Ministry official said.
But the official said there had not been enough time to discuss any concrete steps to tackle food prices this weekend.
The ministers' meeting, which lays the groundwork for development issues at the G8 summit, took place halfway into the calendar for the U.N. Millennium Development Goals, a set of eight globally agreed targets to be reached by 2015.
The goals, set in 2000, range from halving the number of people living in poverty on less than $1 a day, to providing universal primary education and halting the spread of HIV/AIDS.
Experts say most countries may fail to meet them -- a concern expressed by Komura on Sunday.
The development ministers also expressed concerns about a decline in global official development assistance in 2007 from a year earlier, citing latest OECD figures.
Komura said Japan, which slipped to fifth place from third in overseas aid spending in 2007 as it cut such assistance by 30 percent, was determined to reverse a decline in its official development assistance, but did not give any timeframe.

More than 50 percent chance of U.S. recession: Greenspan

By Sonya Dowsett Sun Apr 6, 6:15 AM ET
MADRID (Reuters) - There is more than a 50 percent chance the United States could go into recession, former Federal Reserve chairman Alan Greenspan told El Pais newspaper in an interview published on Sunday.
However, the U.S. has not yet entered recessionary state marked by sharp falls in orders, strong rises in unemployment and intensive weakening of the economy, he said.
"We would have to see signs of this intensification: there are some, but not many yet," he said. "Therefore ... I would not describe the situation we are in as a recession, although the chances that we'll have one are more than 50 percent."
A sharp downturn in the U.S. housing market has led to a full-blown credit crisis that has reverberated throughout the U.S. financial system.
The economy has become increasingly important in the U.S. presidential campaign, topping the list of voters' concerns heading into the November election.
Greenspan, the U.S. Fed chairman from 1987 to 2006, endorsed the Republican presidential candidate John McCain in the interview.
"I'm Republican and I support John McCain, who I know very well and who I respect a lot," he said.
The economies of the United States and the European Union were at a crossroads after a long period of economic growth without inflation, he said.
"This period is going to be much more difficult, from the point of view of monetary policy, than the period during which I was chairman of the Federal Reserve," he said.
Turning to Europe, he pinpointed Spain as having a bigger real estate bubble than the United States, exposing it to the global credit squeeze.
"The real estate bubble in Spain has been bigger than most other European countries, even bigger than the one in the United States," he said. "In that sense, one would have to presume that there is more vulnerability."
Spain has been the fastest-growing major European economy for more than a decade due to a housing boom during which house prices tripled, but the global credit crisis coupled with higher interest rates have put a sharp brake on growth.
He gave a broadly positive overview of other European economies.
(Reporting by Sonya Dowsett; Editing by Paul Bolding)


Tuesday, April 1, 2008

CHINA and INDIA on the rise

The Baton Passes to Asia
Published: March 31, 2008

Roger Cohen
It’s the end of the era of the white man.
I know your head is spinning. The world can feel like one of those split-screen TVs with images of a suicide bombing in Baghdad flashing, and the latest awful market news coursing along the bottom, and an ad for some stool-loosening wonder drug squeezed into a corner.
The jumble makes no sense. It just goes on, like the mindless clacking of an ice-dispenser.
On the globalized treadmill, you drop your eyes again from the screen (now showing ads for gourmet canine cuisine) to the New Yorker or Asahi Shimbun. And another bomb goes off.
There’s a lot of noise and not much signal. Everywhere there is flux and the reaction to it: the quest, sometimes violent, for national or religious identity. These alternate faces of globalization — fluidity and tribalism — define our frontier-dissolving world.
But in all the movement back and forth, basic things shift. The world exists in what Paul Saffo, a forecaster at Stanford University, calls “punctuated equilibrium.” Every now and again, an ice cap the size of Rhode Island breaks off.
The breaking sound right now is that of the end of the era of the white man.
I’d been thinking about this at Dubai airport in the middle of the night, as the latest news came in from the United States of the bloody end to the mother of all spending binges. I was watching the newly affluent from other parts of the world — Asians and Arabs principally — spend their way through the early-morning hours.
The West’s moment, I thought, is passing. Money and might are increasingly elsewhere. America’s little dose of socialism from Ben Bernanke and Hank Paulson might stave off the worst but cannot halt the trend.
Then I arrived in Hong Kong. The talk was all about how U.S. economic woes could impact Chinese growth. Might it tumble to 8 from over 11 percent? And what of India, powering along with growth of a mere 8 percent or so?
The West should have such troubles! Even revised downward, these growth rates are at levels Europe and the United States can only dream of.
Decoupling — another Hong Kong buzzword — is not possible in an interlinked world: export-led Asian economies are vulnerable in some measure to U.S. troubles. But that measure dwindles as the Chinese, Indian and Vietnamese domestic markets explode.
Asian statistics can be numbing. With one third of humanity, the numbers get big. There are now 450 million cell phones in China.
But take another — the likelihood that some 300 million people will move from rural to urban India in the next 20 years — and you get a sense of the shifts underway. By 2030, India will probably overtake Japan as the world’s third-largest economy behind the United States and China.
But in the end, transformation is not about numbers. It’s about the mind. Come to Asia and fear drains away. It’s replaced by confidence and a burning desire to succeed. Asian business leaders are rock stars. The culture of education and achievement is fierce. China is bent on beating the U.S.A.
What you feel in Asia, said Claude Smadja, a prominent global strategist, is “a burst of energy, of new dreams, and the end of the era of Western domination and the white man.”
Hong Kong purrs. Its efficiency and high-speed airport train make New York seem third-world. All the talk of Shanghai rising and Hong Kong falling was wrong: they’re both booming. Mainland Chinese tourists come here in droves to play and spend.
I went to see Frederick Ma, Hong Kong’s secretary for commerce. He’s suave in that effortless Hong Kong way, the shrewdness wrapped in a soothing patter of bonhomie. How is it that this is the only place on earth where people think of what you want before you’ve thought of it yourself?
He eased seamlessly from talk of mind-boggling infrastructure plans involving bridges and high-speed trains to a gentle lament for America.
“I am very worried about the U.S. economy right now,” he said. “When I was visiting last November, I asked a banker friend what’s going on, and she told me that a Wall Street problem was soon going to be a Main Street problem.”
Yep, it’s a Main Street problem all right when people lose their homes and realize overnight they’re illiquid and have 1930s visions as Bear Stearns goes “Poof!” in the night.
Everything passes. In the 17th century, China and India accounted for more than half the world’s economic output. After a modest interlude, the pendulum is swinging back to them at a speed the West has not grasped.
It’s the end of the era of the white man; and, before it even began in earnest, of the white woman, too.
More Articles in Opinion »


Monday, March 24, 2008

NRI Remittances

It seems in the calander year 2007, India origin persons send home to India a sum of USD 27 B. This is an average of about USD 4,700 per person abroad.

Read about it .... http://economictime s.indiatimes. com/News/ Economy/Finance/ Indians_abroad_ sent_27_bn_ home_in_2007/ articleshow/ 2885060.cms It is probably the single largest item on the foreign remittance list. Long live 'brain drain' from the developed world. It is also interesting to note that the investment by India companies abroad has also shot up to such above levels.

So that should answer, who is propping up whom. Best wishes.

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Monday, March 17, 2008

Sensex tumbles in US tailspin

18 Mar 2008, 0029 hrs IST,TNN
MUMBAI: The monsoon is still a few months away. But that doesn’t mean a thing to the deluge of bad news which continues to dampen spirits on Dalal Street. Fears of further losses to Indian banks, slowdown in corporate growth and a fast-spreading contagion of turmoil in the global financial markets took a huge toll on Monday. The sensex lost 951 points in its second steepest fall, wiping out Rs 3.2 lakh crore in investor wealth. Since January 10, when the sensex touched its peak of 21,206 points, over Rs 25.1 lakh crore of investor wealth has just vanished. On New Year’s eve, investors, brokers and fund managers were unanimous that the party in the Indian stock markets was here to stay.

Today, they are a confused lot. Now, they can’t agree if it is over or if it’s time to just hang on or start afresh. Says Shankar Sharma, director at Mumbai-based broking firm First Global, "It is a great time to sell." Counters another large domestic broker: "Does anybody have a clue where the market is headed?"

A fund manager for Reliance Capital continues to be optimistic. Indian stocks have become cheap and the market could soon correct upwards, he says. One thing is for sure. Over the next few months, investors will have to go through gut-wrenching uncertainty.

Track your stocks

Sensex provisionally closes down 6.5 pct

Reuters - 04:28 PM
BANGALORE (Reuters) - India's main stock index provisionally fell 6.47 percent on Monday, tailing a global equities rout, with index heavyweights ICICI Bank and Reliance Industries leading the losses. More »


Wednesday, March 12, 2008

Industrial growth dips to 5.3 pc in Jan amid fears of slowdown

--> Industrial growth dips to 5.3 pc in Jan amid fears of slowdown-->
Wed, Mar 12 03:01 PM
New Delhi, Mar 12 (PTI) In what could be construed as the beginning of a slow down, the year 2008 began on an ominous note with the industrial growth dipping to 5.3 per cent in January, less than half of what was recorded in the same month last year.
The slump in industrial growth would force the Reserve Bank (RBI) to cut interest rates during 2008-09 even if it decides to maintain status quo in its annual monetary policy, to be unveiled in April, because of its concerns on inflation, said HDFC Bank Chief Economist Abheek Barua. Industrial growth, as measured by Index of Industrial Production (IIP) slipped mainly on account of poor showing by all sectors of the industry, including manufacturing, electricity and mining, coupled with negative growth in consumer durables output.
The decline in industrial growth, Barua said, "confirms apprehensions of a slow down in economy. The growth in 2008-09 will be close to 8 per cent rather than 8.
5-9 per cent." The economy is projected to grow by 8.
7 per cent in the current fiscal, as per the advance estimates of the Central Statistical Organisation (CSO). While industrial production in January slipped sharply to 5.
3 per cent from 11.6 per cent in the same month last year, the cumulative growth during April-January worked out to be 8.
7 per cent, down from 11.2 per cent, as per the IIP figures released by the government today.
The growth in the manufacturing sector output, which has almost 80 per cent weight in IIP, declined to 5.9 per cent in January, against 12.
3 per cent in the same month last year. PTI.

Thursday, March 6, 2008

the impact of recession in US

Is the Sky Falling?
Since returning to reality from Australia I can't help but notice an uptick in business conversations about how bad things are in the US and how it will affect Canada. Until now, my observation was that those in the financial services businesses were fully immersed in the issue but other business leaders weren't registering direct concerns. I would say that's changed.Yesterday I got a copy of a Merrill Lynch (US) analysis that summarizes their view of how bad things are/might be. Keeping in mind that over-reaction might always be a reality in both good times and bad (maybe it is, I don't know), this analysis is starkly negative.Their view is based on the simple notion that what the US is facing is a credit contraction and that there is little doubt the consumer - up until now the primary engine keeping the US economy afloat - is about to go AWOL. The bottom line impact? As the report says "for global producers who sell $2.3 trillion of goods and services the US, 70% of which is geared to the consumer class, to be forewarned is to be forearmed - find a new customer somewhere else in the world".Here's some of the thinking on what's happening:> boomers have spent their adult years using credit, backed by the unstoppable increases in the value of their homes to live beyond their means> savings have dried up (personal savings rates in the US are close to zero, down from over 10% in 1985)> boomer retirements, which are just around the corner, were to be funded to a very large extent by home equity> with house prices going the wrong way now, financial debt exceeds financial assets for many boomers - this is driving severely contracted spending on everything - from mortgage and other financial obligations (debt) - to home renovations and most other discretionary spending (everything but food)> boomers who can no longer able to count on the value of their homes, will finally start saving for retirement> with foreclosures, late payments and delinquencies soaring, credit providers are upping the hurdles and severely restricting credit that is available to consumers> with more savings and less available credit, the drag on the economy will be intense. The author concludes: "we have identified the very serious economic issues that could make this recession much more problematic than previous post-war setbacks". Maybe the sky is falling.Some numbers from the analysis:> household liabilities absorb over 50% more of after tax personal income than it did 20 years ago - when interest rates were double what they are now> the household debt-service ratio is 14.3% close to a record high> the personal savings rate is .05%, almost a record low> 1/3 of non-traditional mortgages are already in default> 39% of people who bought a home in the US last year now find their mortgage is larger than the value of their home> credit card approval rates have fallen to 32% from 40% a year ago - direct mail solicitations (remember those) to lure new customers are down 16%.One of the things I've heard some say here is that inflation in the US will be a problem because of the rapid and high prices we're seeing in raw materials like oil and wheat.


Monday, March 3, 2008

Sunday, March 2, 2008

Loan Melas

This new Finance Bill FY09 has presented an unthinkable in populist policy … proposing to write off up to rupees 60,000 crores in farmer debts without even a fig leaf of budgetary support. Writing off farmer loans, reminds me of an earlier era.

During PM Indira Gandhi's time, one of her Ministers: Janardhan Poojari, would go about arranging 'loan melaas' and distribute money (actually loans which were to be treated as 'grants'), and garner votes. This was considered a great socialistic move and praised such that 'Indira became synonymous with India'. She outdid her father the great Jawaharlal who abdicated on 'market compensation' for 'land nationalization'. She is remembered for 'prince purses abdication', bank nationalization' and 'collieries nationalization'.

We citizens are still enjoying the fruits of these great deeds. There is no shortage of fools, right from Md. Bin Tuglak's time, who gave away gold coins for copper. These 'gigantic personalities' are revered-reviled, even today. This single proposal being already treated as a given, announced by FM P. Chidambaram, has dealt a body blow to financial prudence.

Now the farmer will always think that a 'loan' after delinquency becomes a 'grant'. In some ways, this has been going on every few years but in small measure. A prudent policy would have been to reduce interest rates to 1% retroactively, grant a five year period to pay off amount thru EMIs, allow fresh loans to be permitted, again at lower rates. After all farm sector has required a boost for the past ten years. Why was this delayed for so long?

The FM could allow 'market' driven economy for farm products, provide supply-delivery chains free of state borders, better seeds and technology free to the marginal farmers, and alos tax the rich farmers who earn more than Rs. 3 lakhs per year. Force the 28 states to fall in line, by denying their farmers the above benefits.

The marginal farmers are bound by laws of economics to remain marginal for perpetuity and thereby be a major burden on society. So most important, encourage thru fiscal measures, marginal farmers to combine with other littoral one's so that their joint holdings reach 100 hectares, which will allow economies of scale. Such cooperatives to be like village panchayats, keep all politicians and boffins out of it.

Dissolve all politically driven farm cooperatives by denying them tax deductions and subsidies of any kind. Such reforms are pragmatic and create permanent traditions, yet our FM has no heart for it for the past five years. Giving a fish instead of teaching how to fish, ensures that the target group remains enmeshed in poverty to be then browbeaten every election year. I am certain this FM will join the other 'gigantic personalities' mentioned before and be revered-reviled for ages to come. Jai Hind.

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Tuesday, February 26, 2008


Railway Budget

New Delhi - Jammu Tawi train will ply daily.
Freight on petrol, diesel to be cut by 5%.
To cut fares for AC-I by 7%. AC-II by 4% and AC-III by 3%.
To cut sleeper fare by 5%.
New Railway lines to be introduced in Kashmir.
New Udaipur-Delhi bi-weekly train to be introduced.
New Railway hospital in Delhi to be fully airconditioned.
Minorities to get preference on recruitment board.
Modernisation of all rail workshops to be undertaken.
To start 53 new passenger trains. 10 new Garib Raths to be introduced.
All unmanned crossings to be now manned.
New rail-coach factory to be set up in Kerala.
Free season's tickets for female students till graduate level.
50 per cent discount for senior women citizens.
Increased concessions for under-graduate students.
State-of-the-art equipment for Railway Protection Force.
5 per cent job reservation for women in RPF.
Mother-child health express to be launched.
AIDS patients to be given special discounts.
Patna and Delhi stations to be upgraded.
Passenger trains to have anti-collision devices.
In talks with foreign companies for new wagon designs.
Metal detectors and CCTVs to be introduced on all platforms.
560 stations to be lengthened.
Mumbai's CST station to be upgraded.
Bulk handling terminals for Cement and foodgrains.
Public Address Systems for express trains.
Issuance of wait-listed e-tickets to be allowed.
Newly designed high-capacity wagons to be manufactured.
Plan to provide ticket booking via mobile phones.
To upgrade infrastructure in 7 years at Rs 75,000 cr.
50 big terminals planned in Mumbai, Pune, Gaziabad.
Plan to set up 20,000km of high density network.
Railway connectivity to ports to be increased.
New coaches in all Rajdhani trains by 2010.
6,000 automated ticket machines in two years.
30 big stations to have multi-level parking.
50 stations will have elevator and escalator facility.
To link trains via software communication by FY09.
Maintenance of trains to be handed over to private agencies.
To start making steel coaches from FY09.
Smart card based ticket system in the offing.
790 tonnes payload target achieved.
E-tickets to be available through vending machines.
Railway call centre scheme has been a huge success.
Ticket reservation would be possible from anywhere.
Railway fund balance up by Rs 40,298 cr.
Surcharge applied only in peak season.
Revenue from passenger fares increased by 14%.
Tremendous increase in productivity of railway assets.
Railway operating ratio at 76%
Rs 49,250 crore invested in new projects
Railways ended with a profit of Rs 25,000 crore in FY 2007-08
Lalu says, "I have earned crores for Railway in my tenure."
Lalu Prasad Yadav starts to present his 5th Rail Budget.
Lok Sabha adjourned till 12 noon.
The Indian Railways initiative on e-ticketing using the internet is a classic model of how the internet is being leveraged successfully.

Startup firms used the internet to create new business models such as portals, exchanges, e-tailing, auctions, and intermediaries.

The Indian Railways initiative on e-ticketing using the internet is a classic model of how the internet is being leveraged successfully.

Startup firms used the internet to create new business models such as portals, exchanges, e-tailing, auctions, and intermediaries.

Startup firms used the internet to create new business models such as portals, exchanges, e-tailing, auctions, and intermediaries.

The Indian Railways initiative on e-ticketing using the internet is a classic model of how the internet is being leveraged successfully.

The Indian Railways initiative on e-ticketing using the internet is a classic model of how the internet is being leveraged successfully.

Startup firms used the internet to create new business models such as portals, exchanges, e-tailing, auctions, and intermediaries.

The Indian Railways initiative on e-ticketing using the internet is a classic model of how the internet is being leveraged successfully.

Startup firms used the internet to create new business models such as portals, exchanges, e-tailing, auctions, and intermediaries.

Startup firms used the internet to create new business models such as portals.

To cut fares for AC-I by 7%. AC-II by 4% and AC-III by 3%. Sleeper fares cut by 5%
Railway employees to get 70-day bonus.
Mother-child express trains to have special medical facilities.
Special emphasis on security measures in Lalu's Budget.
No standing in long queues in two years.
Incresed transparency in all railway transactions.
New modernization schemes including elevator, escalator, multi-level car park, Vending machines for e-tickets, smart card based access in the offing.
Turnaround of the Indian Railways was due largely to the efforts of its 1.4 million employees.
Maintenance of trains especially Rajdhani and Shatabadi to be handed over to private agencies.
Lalu presents Part-A of the Rail Budget, which concerns with the macro picture. Part-C will carry his proposals.
'Will Lalu make the common man happy?.
The Indian Railways initiative on e-ticketing using the internet is a classic model.

Startup firms used the internet to create new business models such as portals.


Startup firms used the internet to create new business models such as portals.

The Indian Railways initiative on e-ticketing using the internet is a classic model.

Startup firms used the internet to create new business models such as portals.

Startup firms used the internet to create new business models such as portals.



Monday, February 25, 2008


United States dollar
For details of current paper money and coins, see Federal Reserve Note and Coins of the United States dollar.
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The dollar (currency code USD) is the unit of currency of the United States. The U.S. dollar has also been adopted as the official and legal currency by the governments in a few other countries. The U.S. dollar is normally abbreviated as the dollar sign, $, or as USD or US$ to distinguish it from other dollar-denominated currencies and from others that use the $ symbol. It is divided into 100 cents.

Adopted by the Congress of the Confederation of the United States on July 6, 1785,[2] the U.S. dollar is the currency most used in international transactions.[3] Several countries use the U.S. dollar as their official currency, and many others allow it to be used in a de facto capacity.[4] In 1995, over US $380 billion were in circulation, two-thirds of which was outside the United States. By 2005, that figure had doubled to nearly $760 billion, with an estimated half to two-thirds being held overseas,[5] representing an annual growth rate of about 7.6%. However, as of December 2006, the dollar was surpassed by the euro in terms of combined value of cash in circulation.[6] Since then the current value of euro cash in circulation has risen to more than €695 billion, equivalent to US$1,029 billion at current exchange rates.[7]

1 Overview
2 Etymology
2.1 Nicknames
3 Dollar sign
4 History
4.1 Continental currency
4.2 Silver and gold standards
5 Coins
6 Banknotes
7 Value
7.1 Factors influencing the price
7.2 Time-relative value
8 International use
8.1 Dollar versus euro
8.2 The dollar as the major international reserve currency
8.3 US Dollar Index
8.4 Dollarization and fixed exchange rates
9 Exchange rates
9.1 Historical exchange rates
10 See also
11 References
12 External links
12.1 Images of U.S. currency and coins


Article Excerpt
IT IS TIME the United States wakes up to a serious problem. The dollar is increasingly losing the position it has enjoyed for nearly half a century as the world's currency of last resort. And as that happens, the advantages we have gleaned from that status--the ability to finance our twin fiscal and trade deficits while keeping our interest rates low--will also be lost. And yet no one, particularly in Washington, seems overly concerned. The world is awash in dollars right now, and the situation cannot last. My concern is that many in this country continue to have unrealistic views about the sustainability of the status quo. Yes, our domestic economy is doing reasonably well--we have modest but real growth, inflation is quiet, the stock market is booming. But we also have not done anything to address an out-of-control federal government budget deficit and the ongoing huge trade deficits we run up with other nations. How long will other countries continue to provide us with our credit card? Other countries may no longer be willing to provide Washington with a blank check--literally. China's enormous trade surpluses with the United States have generated more than one trillion dollars worth...NOTE: All illustrations and photos have been removed from this article.


China Ends Fixed-Rate Currency
Administration Hails Policy Shift
By Peter S. GoodmanWashington Post Foreign ServiceFriday, July 22, 2005; Page A01

SHANGHAI, July 21 -- China on Thursday took an important step forward in its move toward a market economy, announcing it would increase the value of its currency, the yuan, and abandon its decade-old fixed exchange rate to the U.S. dollar in favor of a link to a basket of world currencies.

The evening announcement on state television delivered China's first concrete move toward allowing the yuan -- also known as the renminbi -- to eventually float freely at the whim of global traders.

Currency Evaluation
The Goal
Under a "float," which China says it wants someday, a currency rises and falls on global markets according to supply and demand. This is the system that applies to many major currencies such as the U.S. dollar, the euro and British pound.

The Old System
Under a "peg," which China has had since 1995, the currency's value is fixed - in China's case, at 8.28 yuan per U.S. dollar.

The New System
Under a "managed float," which China adopted yesterday, the currency can rise and fall but only within prescribed limits.

Friday, 11 a.m. ET
Chinese Currency ChangeMarc Miles, director of the Center for International Trade and Economics at The Heritage Foundation, discusses China's announcement Thursday that it will no longer tie the value of its currency to the U.S. dollar.
China's Currency May Float a Little
Senators Told China Will Loosen Policy On Currency
China Rejects Global Pressure To Change Policy on Currency Talk
Share Your Thoughts

,'China on Thursday took an important step forward in its move toward a market economy, announcing it would increase the value of its currency, the yuan, and abandon its decade-old fixed exchange rate to the U.S. dollar in favor of a link to a basket of world currencies.','Peter S. Goodman') ;

The move eased tensions between China and the United States on a key source of trade friction. The White House, pressured by manufacturers and vocal members of Congress, has lobbied China to raise the value of its currency, arguing that a low-priced yuan has unfairly kept Chinese goods artificially cheap.

The Chinese move was welcomed heartily by the Bush administration.
"They've put in place a mechanism that provides room for significant movement over time in the currency, and they've expressed a commitment to using market forces to let the currency move," Treasury Secretary John W. Snow said at a news conference. "I think today's developments are extremely positive."

China's most strenuous critics in the United States have demanded that Beijing increase the value of its currency by at least 10 percent. Sens. Charles E. Schumer (D-N.Y.) and Lindsey O. Graham (R-S.C.) have been pressing a bill that would impose across-the-board punitive tariffs of 27.5 percent against Chinese imports if China does not substantially raise the value of the yuan. Last month, the two senators delayed the vote after saying they had been assured by Snow and Federal Reserve Chairman Alan Greenspan that a Chinese revaluation was imminent.

The details of China's announced shift fell short of their demands. In a statement posted on its Web site, China's central bank said it would on Friday free the yuan to rise to 8.11 from its current 8.28 to the dollar -- an increase of about 2.1 percent. The bank also said it would allow the yuan to move within a trading range of 0.3 percent above or below the previous day's closing price, continuing its "managed float" policy.

The change garnered measured praise from Schumer: "It is smaller than we hoped," the senator said in a news conference. "But to paraphrase the Chinese philosophers, a trip of a thousand miles can well begin with the first baby step. And the fact that they have opened the door to future increases of 0.3 percent makes us feel and hope that this is not the last."

Analysts said Thursday's movement was probably only the beginning of a series of measures that will eventually allow the yuan to move in a broader trading band with other currencies and to float freely -- albeit not for several years.

"The new managed floating currency regime is just an interim system," said He Fan, an economist at the Chinese Academy of Social Sciences in Beijing. "There is a chance of a further widening of the band in the not-distant future, but it will go step by step."

Others suggested that Beijing was not likely to move again anytime soon. "I believe this revaluation will stay in place for the next 24 months," said Yu Nanping, an economist at East China Normal University in Shanghai.

In a sign of China's regional economic influence, Malaysia on Thursday followed with its own announcement that it, too, is allowing its currency, the ringgit, to float within a proscribed trading band. By contrast, Hong Kong announced it would retain its currency peg to the U.S. dollar.

The Euro as an International Currency: An Evaluation of the Challenge to the Dollar Based on Currency Reserves and the Exchange Rate Ekaterina Kouznetsova, B.A. (Awarded in 2007)Economics
Adviser: Matteo Iacoviello
Download the Thesis (594 K, 63 p., PDF file)
Tell a colleague about it.

Since its launch, the euro has successfully achieved the status of an international currency, and the prospect of its ability to challenge the dollar is increasingly credible. This paper supplements the ongoing academic discussion by reevaluating the characteristics necessary for such a position in light of the most recent information available on the euro area, and then providing econometric evidence as support. I regress the lags of shares of dollar and euro reserves on the current shares and predict steady state values for each currency. I then regress the same lags, as well as the exchange rate lag, on the change in the euro/dollar exchange rate. I find, first, that the share of euro reserves, while still not as high as the share of dollars, is nonetheless significant: about 26%. Second, the euro/dollar exchange rate is only slightly affected by changes in the share of either currency’s reserves. I conclude that confidence in the euro as an alternative international currency is growing, and that the euro has become a real challenge to the dollar.


The US dollar, the euro, and the yen: An evaluation of their present and future status as international currencies

Beckmann, Rainer, Born, Jürgen and Kösters, Wim (2001): The US dollar, the euro, and the yen: An evaluation of their present and future status as international currencies. Published in: IEW Diskussionsbeiträge 38 (2001)
Full text available as:

PDF - Requires a PDF viewer such as GSview, Xpdf or Adobe Acrobat Reader172Kb

The process of European integration and especially the introduction of the euro as the single currency for up to now 12 member countries of the EU in 1999 may alter the existing clear currency hierarchy. The euro area is comparable in size to the US with respect to GDP and even exceeds the US regarding the share in world trade. Thus questions arise of whether the international monetary system turns out to be bipolar in the long run or whether the yen can also play its part.It turns out that real activity, size and sophistication of financial markets, monetary and financial stability and inertia are the most prominent characteristics making a currency to be preferred on a world-wide level.We thus conclude that the integration and the development of European financial markets are of special importance for a stronger international role of the dollar, but that the historical experience of only gradually changing supremacy of international currencies still applies.


US recession

US recession: The Big Daddy grows old
By Haresh Soneji & Shravan Sreenivasula, CNBC-TV18

Knock Knock.
Who’s It?
Recession Who?
The US recession leading the world to a slowdown.

Yes, a lot of people will talk. A lot of people are talking. People will debate. People will criticise. But, people won't forget this for sure for a long long time. This is something that will affect everybody - the US recession. Believe it or not, it’s on. And as they, when America sneezes, the world catches cold.

You may argue that things are changing. We are sure, it will in the long run along the normal curve. But, in the short term, US will affect the world.

CNBC-TV18 does some fact finding and digs out some hard clues for you; look at some of these charts for a clearer picture -

Consumer confidence is falling drastically. Now, almost at its all time low -a 22% drop from its high in July '07.

Home sales data is the lowest ever. Falling consistently since the peak of April ‘05. Down 50% since then. And fallen 26% since April ‘07. The speed has increased.


The Facts On The Sub-Prime Mortgage Meltdown

By Terry Keenan
Ted Turner.

Confused about what the sub-prime mortgage meltdown means for the economy and your money?
Well first, let's call a spade a spade. These risky mortgages aren't really so complex or exotic —they're junk mortgages, plain and simple. Sub-prime is just a euphemism bankers have whipped up to disguise their risk.

It's been a familiar theme in the last few years, as other Wall Street word-meisters have taken to re-labeling risk as well. Leveraged buy-out firms are now called "private equity" shops, junk bonds now are "high yield," and hedge funds are supposedly, well ... hedged. It's a far cry from 20 years ago, when Drexel Burnham was firing up its junk bond machine.

Back then, CNN founder Ted Turner had no problem boasting that junk bonds were for "people who couldn't borrow from the bank." He was right. And while Turner Broadcasting survived, Drexel and hundreds of other high-yield borrowers didn't. The fallout helped to exacerbate the Savings and Loan crisis, the real estate bust of the early 90s, and the recession of 1991-92. But at least investors were warned of the risk — the bonds belonged in the junkyard when it came to credit quality.

Not so this time around. Although the housing bears have been warning the risky features of mortgage lending in recent years, those cautious few were laughed off. Few really talked about just how "sub" the sub-prime borrower really was.

Well, now we know. Not only were millions able to borrow with no money down, no proof of income, not even proof of legal status, the Mortgage Bankers Association now says nearly 14 percent of those junky borrowers were delinquent on their mortgage payments at the end of 2006 — even with the economy at near full employment.

Now that it's all over, except the crying, Washington is wading into the mess. With estimates floating around this week that 2.2 million Americans may lose their homes to foreclosure, Democrats are calling for hearings into so-called "predatory" lending practices. Yes, the very same lawmakers who turned a blind's eye to years of lax lending in their own backyard (at Fannie Mae and Freddie Mac) now want to turn millions of Americans into victims of the housing boom they championed.

It's going to get messy, and that's why investors are frightened, and rightly so. As in the wake of other financial crises such as Enron, Orange County and Long Term Capital, the Fed, lawmakers and lenders are cracking now that the game has come to an end. Where were they to protect unqualified borrowers a year or two ago, when the trashy mortgage party was just kicking off?
What the market is saying is that the hangover is here and it's going to be a doozy. Mortgages will be far harder to come by, down payments will go way up, home prices will continue to go down, and the money machine that was the $6.5 trillion mortgage industry will grind to a halt. That will hit the brokerage stocks, the banks, the homebuilders and the housing products stocks right in the bottom-line.

And with those companies making up more than 30 percent of the value of the S&P 500, there's likely more fallout to come.

Terry Keenan is anchor of Cashin’ In and is a FOX News Channel business correspondent. Tune in to Cashin' In on Saturdays at 11:30am and find out what you need to know to make your money grow and keep what you already have!


Sub-prime mortgage market -Some facts and data
Fri, 16 Mar 2007 15:26:09 GMTby Peter Possing Andersen
Danske Bank A/S

The sub-prime mortgage market
The sub-prime market is the part of the mortgage market devoted to borrowers with a less than perfect or bad credit record.
According to the latest MBA (Mortgage Bankers Association) figures the sub-prime sector makes up13.7% of the total mortgage market.
Sub-prime borrowers face higher costs due to their lower credit standards and higher risk of delinquency.

The sub-prime market covers the same spectre of available loan types as the prime market: adjustable rate mortgages (ARM), fixed rate mortgages (FRM) etc.

The structure of the US mortgage market
Sub-prime as a share of total mortgages.
Sub-prime delinquencies
Sub-prime foreclosures
Prime delinquencies
Prime foreclosures
Delinquencies and foreclosures -all mortgage loans
Tighter mortgage credit standards
No signs of distress in broad credit measures.
Consumer balance sheets remain healthy

What are the concerns?
A bust in the sub-prime market impacting the financial sector negatively
Households with loans in the sub-prime market cutting back consumption due to credit distress
Prime lending standards tightening and feeding negatively into a broad consumer slowdown

Is this the first sign of liquidity drying out?
Our take on the macroeconomic impacts #1
No doubt that the problems in the sub-prime market are serious.
The sub-prime jitters could be an early warning of more widespread trouble in the credit market, with negative macroeconomic consequences.
While signs of such developments should be watched closely, we expect the problems to remain contained within the sub-prime sector.

At present there are no signs of distress in neither the prime mortgage market or other segments of the consumer credit markets.

Our take on the macroeconomic impacts #2
With the economy remaining sound outside the housing market (i.e. healthy household and corporate balance sheets, continued job growth and high income growth) the conditions for a credit crunch are not present.

Moreover, we do not expect a major outright drop in house prices. That said, mortgage credit standards are likely to be tightened further going forward.

However, given the present situation we do not expect aggregate consumer spending to enjoy any major spill-over from the crisis in the sub-prime mortgage sector.

As a whole we expect no large ramifications on the macro economy from the sub-prime crisis.
Download full Sub-prime mortgage market with charts


German Bank Blames UBS for Subprime Hit

By Carrick Mollenkamp
Word Count: 397 Companies Featured in This Article: UBS, Citigroup, Merrill Lynch

HSH Nordbank AG said Swiss bank UBS AG sold it $500 million in securities tied to U.S. subprime mortgages that have since soured, in the latest case of a midtier German lender to be singed by the slump in the U.S. mortgage market.

HSH, which specializes in shipping finance, joins a growing number of investors around the world, including municipalities in the U.S. and Australia, that fault the banks that packaged and sold the investments. HSH said yesterday in a ...

get scholarships, help page

Mukund Chandak,
VJTI, Mumbai

“We aspire to provide help to the economically weak but brilliant brains throughout the world in general, but developing countries and rural areas, in specific, so as to help in making them capable of something they have in themselves”

We the students of VJTI believe that every child has a right to education and no student should be deprived of education for the need of funds. We observed that if a student is sure that his education will not be interrupted due to lack of money he can work more efficiently. There are many trusts that provide a helping hand to the needy students. But at present there is no way for students to know how to contact these trusts. As a small step towards completion of this mission we are trying to provide a database enlisting the details of various organizations which provide the necessary resources for fulfilling the dreams of these bright students

Hillary sings Obama tune to oppose outsourcing

Hillary, who had in the past refused to join the anti-outsourcing bandwagon, has been perceived as a fence sitter on the issue till now

Washington: Democratic Presidential hopeful Hillary Clinton has joined party rival Barak Obama in promising an end to tax breaks to companies that ship jobs overseas, playing to the gallery on the hot-button issue of outsourcing as she tries to resuscitate her White House bid.

“We are going to rid the tax code of these loopholes and giveaways. We’re going to stop giving a penny of your money to anybody who ships a job out of Texas, Ohio or anywhere else to another country,” Hillary said during a debate with Obama at University of Texas in Austin.
Hillary, who had in the past refused to join the anti-outsourcing bandwagon, has been perceived as a fence sitter on the issue till now.

Taking a cue from Obama, who has been fiercely opposing outsourcing, the 60-year-old, who is banking on March 4 contests in Ohio and Texas to revive her fading campaign, appeared to be joining the hardliners in an effort to attract the blue-collared workers.

“You don’t need an economist or the Federal Reserve to tell the American people that the economy’s in trouble, because they’ve been experiencing it for years now,” Obama said last night.

Promising to restore “a sense of fairness and balance” to the US economy, he said “we’ve got to stop giving tax breaks to companies that are shipping jobs overseas and invest those tax breaks in companies that are investing here in the United States of America.”

Clinton agreed, “We are going to rid the tax code of these loopholes and giveaways. We’re going to stop giving a penny of your money to anybody who ships a job out of Texas, Ohio or anywhere else to another country.”

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What the Indian FM should do

Abolish income tax and look at other ways to ensure that India does not slip into an economic crisis
Subramanian Swamy

Congress party leaders have let the cat out of the bag and publicly deflated finance minister (FM) P. Chidambaram in a most embarrassing way. According to a well-placed media leak, a conclave of 38 party leaders told the FM that this year they would like to have a Budget “that caters to the aam aadmi”. Thus, they told him, inflation and farmers’ woes must be combated head-on and relief given concretely. No more esoteric dream budget rhetoric, they told him.

(Jayachandran/Mint)The implication of this directive is that the last four budgets Chidambaram presented did not cater to the aam aadmi, and that today inflation is rampant and farmers are in distress. Thus the globetrotting FM was rudely brought down on desi soil and given a reality check by the party itself.

Despite high GDP growth, the internal organs of the Indian economy are not healthy today. This is alarming. Any fast growing economy can collapse suddenly, as the 1997 experience of the East Asian economies showed.

These are the principal ills in the economy right now.
1. Jobless, low-productivity growth. High growth rates are not generating enough jobs, which have been growing at 2.25% a year since 1999-2000. However, to progressively reduce the unemployment backlog, absorb excess farm labour into industry and provide for the new entrants in the labour market, jobs must grow at about 3.5% a year. At the same time, the economy must raise productivity of labour and capital through induced innovations and new management practices, so that higher and higher investment rates would not be needed to sustain growth. Hence, in the Budget there must be adequate provision for encouragement of labour-using instead of labour-substituting technology. There should also be provisions to promote innovation through radical tax breaks. This means the education sector has to be nurtured in the Budget.

2. Lack of agricultural reforms. The growth rate in agriculture should be at least 4% annually to ensure that 8-10% GDP growth is sustainable. But since 1997, agriculture has shown a trend rate of 2.5%, with wide fluctuations year to year, due to lack of reforms, declining public investment, and poor, even pre-modern, infrastructure. Rather than resorting to the silly ad hoc measures to uplift rural people that we have seen in past budgets, we must empower farmers to export through imaginative schemes rather than provide more subsidies and higher purchase prices.
3. Fiscal deficit. Governments are impounding public sector bank funds (nearly 48%) to finance the budget deficit, thereby starving the public sector (especially manufacturing) of resources. Chidambaram has a propensity to play to the gallery of unions of organized labour by wrecking fiscal balances through the appointment of pay commissions (for example, in 1997 and 2006) and then creating a huge capital account budget surplus to finance the huge revenue account budget deficit. This is anti-development. No wonder inflation is rampant today, fuelled by rising money ­supply from revenue ­expenditure.

4. Debt trap. The debt accumulated by the Centre and states is so large (86% of GDP) that the annual servicing outlay now exceeds the fresh loans taken. This is unsustainable and can explode into a crisis. Moreover, if we correct Chidambaram’s budgets to date for the Enron-type classification of contingent liabilities, then, as the International Monetary Fund (IMF) recently found, the fiscal deficit as a ratio of GDP has actually been rising, and not falling as the FM claims.

5. Budget allocations are straitjacketed. Due to the folly of all finance ministers since 1996, nearly 98% of the receipts in the revenue budget are committed to heads that cannot be politically pruned. That is, items such as defence, subsidies, interest payments, counter-guarantees, pensions, police and grants to states are those committed allocations that weak governments cannot reduce. These commitments leave only 2% of total revenue receipts for other sectors. Hence, the governments are dependent on loans for funding other heads of expenditure, which, however, due to the debt trap, is also an evaporating option for funds.

So, the question will be: How will the Budget address these five major ills without aggravating the economic situation? By 2101, ­India will at this rate face a major fiscal crisis of the kind we have not seen before.

First, the middle class has to be motivated to save more, go in for financial products such as insurance and equity, and buy consumer durables on credit. For this, we must abolish income tax, which is largely at the root of India’s black money. The resources lost for the government can be more than recouped through increased quantum of excise revenue due to higher growth rate arising from higher investment.

Second, Indian industry must be encouraged to out-compete Chinese labour-intensive manufacturing. For this, India must invite foreign direct investment and otherwise invest in food processing, textiles, retail trade, infrastructure and R&D. We need a nationally focused skill augmenting education system.

Third, treat agriculture as industry and extend all the fiscal concessions to industry to it. Land should be leased and consolidated where farmer cooperatives want to enter grain, vegetable, fruit, milk and flower exports. Local feeder airports should be constructed for speedy freight transport and e-commerce introduced.

Fourth, to discourage the government from poaching on bank finances for revenue expenditure, public sector banks must be privatized. The government can compete with others for these funds through the market, or by equity floating of public sector enterprises.
Subramanian Swamy is a former Union minister of commerce. Comments are welcome at ­
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Wall Street

Elaborate marble facade of NYSE as seen from the intersection of Broad and Wall Streets
Wall Street is a thoroughfare in lower Manhattan island, New York City, USA. It runs east from Broadway downhill to South Street on the East River, through the historical center of the Financial District. Wall Street was the first permanent home of the New York Stock Exchange, and over time Wall Street became the name of the surrounding geographic neighborhood.[1] Wall Street is also shorthand (or a metonym) for "influential financial interests" in the U.S.[2] as well as for the financial industry in the New York City area.
Several major U.S. stock and other exchanges remain headquartered on Wall Street and in the Financial District, including the NYSE, NASDAQ, AMEX, NYMEX, and NYBOT. Many New York-based financial firms are no longer headquartered on Wall Street, but are in midtown Manhattan, the outer boroughs of the city, Long Island, Westchester County, Fairfield County, Connecticut, or New Jersey.
1 History
1.1 Decline and revitalization
2 Wall Street today
3 Buildings
4 Personalities
5 Cultural influence
5.1 Wall Street vs. Main Street
5.2 Perceptions
5.3 In literature and popular culture
6 Transport
7 Similar institutions
8 See also
9 References
9.1 Cited references
9.2 Bibliography
10 External links