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Raghuram Rajan, former chief economist of the International Monetary Fund, is appointed the new chief of India's central bank in August 2013.

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Raghuram Rajan, former chief economist at the IMF, and William White, former head of the economics department at Bank for International Settlements, both see the need to raise rates. But expert opinion on the other side sees the need for caution as the economic outlook worsens, and supports ECB and US Fed's efforts to counteract a deteriorating economic situation.

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Gabriele Steinhauser's interview July 16, 2015 with the chief of eurozone finance ministers, Dutch finance minister Dijsselbloem. He tells Steinhauser the lowest moment in the crisis came on the night of July 5 when the referendum results were announced. He expected a "no" vote as he knows this is the way this sort of referendum turns out. He was present in all the critical moments of the crisis. And this moment gave him a sad feeling because of his conviction that it would take tough measures to sort out something like Greece, and the Greek people had been given the idea that this vote could change things. He says Tsipras heard a lot from European leaders on July 7 about lack of trust. Following an ultimatum to Greece about Grexit or acceptance of the measures to be taken, and Greece's acceptance on July 9, more hurdles emerged on July 11, 2015. One came from the IMF with an estimate of 86 billion euros as the cost of new loans to Greece, and possible writedowns on 180 billion euros already loaned. He says Greece's new finance minister, Euclid Tsakalotos, a Oxford educated economist, who was Alternate Minister for International Economic Affairs in the Syriza government from Jan to July 5, 2015, showed a remarkable ability to absorb the criticism as a lot of the bad news surfaced. A Wikipedia note on Tsakalotos shows a similiar background 10 years apart for George Osborne, Britain's chancellor of the Exchequer, and Tsakalotos- both educated at St. Paul's school and Oxford, and Tsakalotos's wife Heather Gibson also from Britain. Tsakalotos was seen as being at ease with the EU ministers, who thanked him for his attitude, of grace under a lot of pressure, and the way he handled the matter. Another piece of difficult news, says Dijsselbloem, was the insistence of German finance minister Schauble on a default scenario of Greece opting out of the euro for a number of years being included in a eurozone statement. After 17 hours of drafting, the final statement left this scenario out. It included a 50 billion euro privatization fund with half to be setup to help capitalize Greek banks, quarter to pay down debt, and a quarter to generate economic growth. Compared to the day following the referendum, Dijsselbloem says he feels it will be a difficult road with many problems, but he feels now that it can be sorted out. Stangely he does not make any mention of the role of the French under premier Valls and president Hollande between July 6 and July 9, including sending advisors to Greece to help draft proposals, in turning the situation around. Only saying he is relieved- possibly of not having some of the burden of the failure to resolve the crisis falling on the Dutch finance minister....

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Year over year inflation in Dec. 2013 was 9.9% in India. RBI Governor Raghuram Rajan plans to focus on headline inflation which focusses on food and fuel which are about 60% of the consumer basket in India. Earlier RBI efforts used a number of indicators- inflation, growth, financial stability and exchange rates which created confusion in the minds of investors about the serious control of rising prices. Inflation for the last 5 years has been over 8%, and is persistent even as growth slows. The policy rate is now about 2 percentage points below inflation. Inflation targeting under Rajan could take the shape of 8% target in the first year, dropping to 6% and then a range between 2-6%.

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To get an idea of the scale of paralysis in the Congress party administration of Manmohan Singh in India in 2011-2014 consider this- more than $100 billion in critical infrastructure projects were held up by slow growth and red tape, according to estimates of the Centre for Monitoring the Indian Economy. The Congress party was too preoccupied with fighting charges of corruption adding to the lack of leadership from Singh and Gandhi, and focussed on programs of subsidies for voters to prepare for the 2014 elections. In the last 12 months alone ending in March 2014, manufacturing projects of about $54 billion were shelved, according to the Centre for Monitoring the Indian Economy. The climate of uncertainty led to Indian companies investing overseas, or simply holding back instead of investing in the Indian economy. Industrial production declined for the first time since the 1990's during the 12 months ending in March 2014. It is in this vaccum in leadership since 2012, and a seriously troubled economy, that the 2014 parliamentary elections were held. Impatient young voters- with about 100 million new young voters added to voting lists- gave Modi and the BJP party an absolute majority and mandate for coming up with new solutions to India's problems in jobs and infrastructure....

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Raghuram Rajan interviewed by BW's Peter Coy. Rajan was prescient in questioning the Greenspan Fed's policies and the risks posed by the excessive leveraging in the financial system at the 2005 Jackson Hole conference. After the excessive monetary easing by the Bernanke Federal Reserve, Rajan questions the wisdom of keeping interest rates too low for too long. He joins John Taylor, George W. Bush presidential advisor, and Allan Meltzer of Carnegie-Mellon in making this point. Rajan was the chief economist at the IMF from 2003 to 2006. He is the author of a 2010 book, Fault Lines: How Hidden Fractures still Threaten the World Economy. The fault lines he describes are rising inequality in the US and the dependence of the US on loans from China.

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The new head of U.S. President Obama's Council of Economic Advisors, is Princeton economics professor, Alan Krueger. Kueger is known as the academic's academic, whose office is located with other labor scholars in the Princeton library. His work has focussed on what he calls "Rockenomics" (research about which bands do well and the reasons for this), on commuting, on studies such as the one with a suggestive title, "Sorting in the Labor Market: Do Gregarious Workers Flock to Interactive Jobs?" His appointment suggests the Obama administration is looking at no new policy initiatives, focussing on an incrementalist approach in policy actions, with the hope that he can get both political parties behind smaller changes. Putting a micro-specialist in charge at a time of huge volatility in financial markets shows an administration that is likely to continue the status quo with small changes till the presidential elections in 2012- the opposite of strong action because the Obama adminstration has no idea how to turn this economy around and only hopes things will change....

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Indifference on the Republican side, and a sense that not much is going to get done on the Democratic side, as President Obama pitches a $447 billion second stimulus plan in a speech to both houses of the U.S. Congress on September 8, 2011. Dana Milbank documents the attitudes and skepticism with which members of Congress received the proposals- a general sense that President Obama was too weak and ineffective to get things done and has lost credibility. John Taylor, senior economic advisor on the Republican side pointed out in a Wall Street Journal column a few days before the speech, that the jobs proposals Obama and economic advisor Alan Krueger were presenting were similiar to old plans that have not produced results. Taylor viewed them as placing too much reliance on government and not enough on the private sector to generate economic growth and jobs.

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Former prime minister Nawaz Sharif's PML-N party wins 125 of 269 seats in Pakistan's parliament. The Tehreek-e-Insaf party of Imran Khan won 31 seats and the PML-N party of the current president Asif Zardari won 32 seats mostly in Sindh province. Independents won 31 seats and some of these independents are likely to support Sharif in forming a new government. Election turnout of 60% showed a large degree of enthusiasm in this election and hopes for economic revival in Pakistan. The focus of Sharif will be on improving the economy, tackling electricity shortages, and building infrastructure. Sharif promised to pursue peaceful relations with India and Afghanistan, and keep the focus on the economy. Sharif and his advisers are bringing a new deftness in the dealings with the Army, the Pakistan Taliban, saying he would call for a halting of drone strikes, limiting the role the U.S. plays in the region, both positions popular in Pakistan, separating differences with former president Musharraf from the institutional role of the military. Small business owners and large business support Sharif's efforts to tackle electricity shortages, with an estimated loss of $12 billion in idled factories alone. The long period of political conflicts between the military, the judiciary and the political parties have led to neglect of Pakistan's economy, as neighboring countries in Asia surged ahead. The realization that popular pressure for improving standards of living and the economic opportunities are both huge has led to an extraordinary election, and put Sharif at the centre of an important new beginning for Pakistan. ...

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Proposals by economists Rajan, Stein and Kashyap on financial catastrophe insurance, and bonuses held in escrow, as corrective measures after learning from the 2008 global financial crisis.

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After increasing the price of subsidized diesel, the Indian government lays out a plan to cut the deficit over five years. The plan sets a goal for the deficit of 5.3% for fiscal year ending March 2013 to come down to 3% by 2017. Earlier India's central bank, the Reserve Bank of India (RBI), had said the government needed to take action on the deficit before it reduced interest rates. The RBI faces a difficult task in reducing rates to stimulate the slowing economy because inflation was 7.8% in Sept. 2012. At the same time the sharp decline in growth is a cause for serious concern- the most recent RBI forecast for GDP growth made in July for the current fiscal year through March 2013 is 6.5%. This may not be achieved as other economists have lowered the estimate to as low as 5% because of slow government action in economic reforms, high interest rates, and the uncertain global economc outlook. The last action by the RBI to lower interest rates was a drop of half a percentage point in April 2012. Much of the momentum for the Indian economy was lost in the first half of 2012 with the governments vacillating steps for opening the retail and other sectors to foreign investment. Only in October 2012 has prime minister Manmohan Singh set a clear direction by dropping coalition partners opposed to reforms and announcing new policies for foreign investment....

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Did U.S. Treaury Secretary, Timothy Geithner, ignore a key request by President Obama to present plans for the restructuring of Citigroup after the government bailout of Citigroup? Ron Suskind says this is what happened in his book on the Obama administration and how the White House operated to make key decisions. Ron Suskind, intervewed key members of the Obama White House economic policy team, Lawrence Summers, Christina Romer, Peter Orszag. In all Suskind conducted 700 hours of interviews for his new book in Sept 2011: "Confidence Men: Wall Street, Washington and the Education of a President." According to the book, in early 2009 after Obama authorized a series of stress tests for banks he told Geithner to develop a plan for restructuring Citigroup. A month later at a meeting not attended by Geithner Obama raised a question about the status of the plan. He was told by Romer that no restructuring plan had been developed for Citi. Suskind says Geithner disagreed about a plan to restructure Citi and decided to ignore the request. Geithner and the Treasury Department say Obama asked Geithner to develop a backup plan to overhaul banks if the government was forced to keep a big ownership stake in the companies, and "there was fortunately never a need to put them in place." Geithner told Suskind that he doesn't slow-walk the President on any matter. Other aspects of the operation of the economic policy team that Suskind covers are a series of memos from top aide Pete Rouse raising questions that ongoing communication between some members of the economic team and Summers was giving Summers power to shape policy. Summers, Director of the National Economic Council, is shown as trying to keep out the views of Romer and budget director Orszag from reaching the President without going through him. When Orszag gives a private report to the president on the deficit, Summers objects saying that this was immoral. Obama lacked the fresh ideas needed to tackle the problems created by the mortgage and banking crisis of 2008, when he used the Clinton administration economic policy team of the 1990's- Rubin, Bernanke, Summers and Geithner. Fresh approaches were needed two decades after Clinton's election in 1992, and the Bush administration that followed, as many of the problems developed during this period. The similiar embedded thinking was shared during the Clinton and Bush administrations and the economic advisors about dealings with the banking sector, but the situation for deficits, unemployment, housing, and the economy had completely changed requiring fresh approaches. ...

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Economist John Spence on advice to the Chinese government to tackle problems of shifting from an export based economy to one more dependent on domestic spending. And managing the shift upscale to sophisticated technologies from basic consumer goods.

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This NYT editorial on slowing growth in India is critical of the performance of prime minister Manmohan Singh's government.

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Amol Sharma and Paul Beckett of the WSJ interview Finance Minister Chidambaram about the Indian government's decisions to open up the insurance, retail and airline sectors to foreign investment, and bring the deficit down to close to 5.3% in 2013. Faced with slowing growth and the risk of credit ratings agencies lowering India's credit ratings the government of prime minister Manmohan Singh has decided to take some decisive steps, including a shift in coalition partners to maintain parliamentary support for these steps. When asked about what influenced the government's resolve to take these decisions, Chidambaram says credit ratings was one factor, another was the difficulty Indian companies were having raising capital inside the Indian market and overseas. In addition he says growth could not be sustained at earlier levels without new capital, and new foreign investment was needed for sustained growth. The Kelkar committee report provided a sense of urgency to the government by providing an independent view and showing the worst case scenario if the government maintained the status quo. Chidambaram says subsidies will now be transferred in the form of cash directly to beneficiaries and reduce costs by cutting leakage in the system.The government will use the list of LPG cooking gas households to transfer the subsidy for 6 gas cylinders directly to beneficiary accounts. The plan is to do the same for the Rural Employment Guarantee Program and subsidized foodgrains to cut the leakage that stems from duplication and falsification. The Indian government's ongoing program to use information technology to have computerized records of the the entire population and linking to the financial system, incuding a large rural population, now makes it possible to take these steps. On the Kelkar committee's recommendation to increase prices of basic commodities cooking gas, kerosene and food to reduce government subsidies, Chidambaram says this is ambitious and the government has to consider the political context even though it agrees that this has to be done over time....

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This editorial in the New York Times is strongly critical of former president Barack Obama for accepting $400,000 in speaking fees from Wall Street for a single speech. It says the news is causing people to question the ideas and words presented by Obama in his books about the dangers of losing sight of the interests of ordinary people. It gives the impression says the NYT, that Obama is cashing in like everybody else, and that his talk was empty. The editorial says the millions raised by Hillary Clinton led to her defeat in the election. Obama is reported to plan a foundation with the work of training a new generation of political leaders. This NYT editorial says it would be better to stay true to vision and purpose, to walk the talk for president Obama, especially now that a recent poll shows two thirds of voters, including about half of Democrats say that the Democratic Party is out of touch with the interests of the American People. By associating this closely with wealthy donors leading Democrats contributed to this. During a period when some of the remarkable achievements of the last fifty years such as the European Union are being called into question, when ordinary working people, young people and older people are struggling, this is all the more a tone deaf approach by politicians. The idea of helping train a new generation of political leaders through a foundation sounds bizarre in this context, and seems to suggest politicians believe there is always a solution through marketing their audacity and money.   ...