May 4,the D-Day

·  The new challenges in IT

·  Nepal Army chief sacked

·  No swine flu case: government

·  Alternatives to politics vs alternative politics

·  Military action looks likely in Swat district

·  Flu spreads through Europe, Latin America

·  Collapsed banks pile up in U.S.

·  U.S. fully backing Pakistan government: Holbrooke

·  TULF for global intervention on civilians

·  FASTFACT

·  Fresh initiatives in SCO expansion

·  Nature of Bliss

May 2

·  Exports plummet 33% in March

·  Sugar output may exceed 147 lakh tonnes

·  Sri Lanka: what needs to be done

·  AIDS vaccine prospects brighten

·  Court: set up six fast track courts to try Godhra & riot cases

·  Trial can be completed in a year: SIT chief

·  3 Sea Tiger suicide boats destroyed

·  ISRO to send bacteria cells into space

·  Swine flu: tight screening at airport

·  Talks to save Swat accord fruitless

·  Japan to give aid to Sri Lanka

·  May Day: demand for jobs, pension

·  Destroy Taliban in two weeks: U.S. to Pakistan

·  FASTFACT

·  Raising profile as a maritime power in East Asia

·  Pursuit of higher values

13th

 

  Codifying social obligations  

  Rajapaksa orders two-day halt to military offensive

  EC advisory to parties on model code

  Emergency declared in Bangkok

  India regains Sultan Azlan Shah Cup

  India has been urging Colombo to stop war: Chidambaram

  Using technology to fight corruption

  India working on ratification procedures (ISSA)

  FASTFACT

  For North Korea, a notable success amidst failure

  India should strive to bring back money from Swiss banks: Arun Shourie

  Devotional practice

 

 

 

12th

 

·  Southern States to benefit from RIL’s gas allocation  

·  India-ASEAN summit put off

 

HINDU TODAY

  Higher fiscal deficit key to economic revival, says Virmani

  In search of a role

  Saving jobs in a time of crisis

  Chandrayaan’s first image of Earth in its entirety

  Russia delivers first batch of nuclear fuel

  Bust of Nehru falls off pedestal

  Italy mourns quake victims

  U.N. asked to pressure LTTE

  Thai protesters leave the stage for ASEAN

  Only 42,000 H-1B applicants in one week

  Fiji’s President assumes power, fires judges  

  Obama breaks fresh ground in Iran

  Jaswant promises to take up Gorkhaland with Centre

  FASTFACT

  Palestinians need a partner for peace

  Somalia: piracy’s feeding frenzy goes on

  Greatness of the Vedas

 

 10th

  Industrial growth shrinks again by 1.2 % in Feb

  Annual inflation at 8.4 per cent

  Power sector to get gas from KG-D6

  Hail to the first human in space!

  Green stimulus

  In good health  

  Iran inaugurates new nuclear fuel facility

  ‘A thorn in India-China relationship’

  India’s biggest auction of oil and gasfields

  Inflation hits new 30-year low

  Who knows facilities exist for the disabled to vote?

  Swat peace deal in jeopardy

  Bangladesh begins war crimes trial

  Bainimarama gives up post after verdict

  Taliban: a response to modernity

  North Korea appreciates India’s stand

  Missile deal not signed in a jiffy: Antony

  “Step towards knowledge society sans boundaries”

  FASTFACT

  Seven words on the Cross

 

9th

  Gold surges on strong global cues

  Battling cervical cancer

  U.S. for involving India in global issues

  India-China relations in one of the best periods in history

  Survey of birds begins in different parts of Kanyakumari district

  India’s spy satellite to eye terrorists

  China is new power centre: Chavez

  Kumar goes to the White House

  Re-democratising the electoral system

  India a vital leader: Holbrooke

  In the world of the disabled

  Hands off academic matters: Court

  FASTFACT

  Different strokes of ‘people power’

  Glimpses of the divine

 

8th

  A sharp deterioration

  Fujimori convicted

  Still a lot of work to do in Iraq: Obama

  Gulf stability is India’s concern

  Obama’s flawed Afghan strategy

  Less rhetoric, more pragmatism in London

  Principle of surrender

 

Hindu Today

 

7^th

 

  Kamal Nath to represent ASEAN summit in Thailand

  Obama and a nuclear-free world

  Problems of plenty

  Airfield to be reopened in east Ladakh

  Nirupam Sen made Special U.N. Adviser

  India an indispensable regional actor, says U.S. think-tank

  Citizens report: how shameful will the 15th Lok Sabha be?

  President rides electric car

  Package deals — with credibility discounts

  ‘Order of Friendship’ conferred on Karan Singh, Bhishma Narain Singh

  Pakistan leery of U.S. war on militants

  Two speeches that change nuclear rules

  Mahavira’s teachings

 

 

6^th

 

 

  Financing health

  Transition in Malaysia

  Controversial satellite launch by North Korea triggers alarm

  “India will not sign NPT in present format”

  India in dilemma over North Korean satellite launch news analysis

  Focus on black money stashed in foreign banks

  Many young voters, but is there a youth vote?

  Antarctic iceberg ‘set to collapse’

  To present Iran a clear choice

  The Divine name

 

5^th

 

 

·  15-20% drop forecast in March exports

·  Why hedonistic polygyny is against Islam

·  India, China have strategic ties: Ambassador Zhang Yan

·  Criminalisation and corruption hurt electoral system, says K.K. Venugopal

·  Violent protests mar NATO Summit

·  India 54th in networked readiness index

·  Include social charter in manifestos: Aruna Roy

 

4^th

 

 

 

 

  G-20 pledge not to raise new trade barriers

  A substantial deal

  Economic crisis and public anger

  Tax havens put on notice

  Joblessness may rise : ILO

  Missile deal with Israeli firm covered by integrity clause

  Factors for success

 

3^rd

 

  Inflation inches up to 0.31%

  Assumes charge as Nasscom Chairman

  Eighth round of NELP to be launched on April 9

  No, he can’t

  IT for health

  London summit pledges $1.1 trillion to boost global economy

  Manmohan expresses concern at rising protectionism

  President’s rule may be revoked

  Extremists threaten the very existence of Pakistan: Petraeus

  Obama was star of the summit

  LTTE plea to Norway

  Indian EVMs for Nepal

  Cesc Fabregas set to return

  Maharashtra: the dull days of White Gold

  A baul’s plea for peace

  Lok Sabha only rule?

  Sole astronaut ideates on India’s space future

  Electing to vote

  Ending decades-old rift with NATO

  Viral screening test effective against cervical cancer

  Politics adds to economic turmoil in Hungary

  Attitude of surrender

 

Some questions on Economics that we trained our caniddates on for the Interview Programme

1.     Do you think Indian economy is in trouble?

2.     What will happen to the 11^th five year plan targets?

3.     Who is Keynes?

4.     We are all said to be Keynesians today. Why?

5.     Haven’t we always been Keynesians in India , since Independence?

6.     What is capitalism?

7.     Is it in crisis?

8.     How do we resolve the crisis?

9.     Differentiate between fiscal stimulus, bailout and monetary stimulus.

10. What is moral hazard?

11. Some say that the RBI is responsible for the crisis. Do you agree?

12. Some say that the RBI is on another planet? Why did they say it?

13. We do not  have a dedicated Finance Minister at the centre.  Are you worried?

14. What is populism/pork barrel?

15. What is a recession? How is it different from Depression?

16. Stagflation?

17. What is liquidity trap?

18. Why are we slashing the direct taxes only? Why cant the income tax be brought down so that people can spend and kickstart the economy?

19. Have you heard of conditional cash transfers?

20. Mark to market

21. Financial innovation

22. Money multiplier and gearing

23. Decoupling theory
Why is agriculture not growing

24. Bailout and stimulus and liquidity injection

25. Too big to fail- do you believe in it?

26. Financial inclusion

27. Leverage

28. Gearing

29. Flipping

30. Greed

31. Speculation

32. Expectations

33. Deflation

34. Protectionism

35. Liquidity crunch/Liquidity trap/liquidity crisis

36. Deglobalization/deprivatization

37. Nationalization

38. Crisis of confidence

39. Consumer confidence

40. Business confidence

41. What is a well capitalized bank?

42. Basel norms

43. Shadow economy/fictitious economy/virtual economy

44. Regulator should be ahead of the curve- what do u mean?

45. How did Lehman go bankrupt?

46. What are toxic assets

47. Securitization

48. Nationalize the losses and privatize the profits?

49. Good bank bad bank

50. Wall street main street

51. Market failure

52. deflation- is it not good?

 and so on and on 

April 1

  Monetise fiscal deficit, says Venu Srinivasan

  TDSAT upholds spectrum policy

  Anti-dumping duty on stainless steel favoured

  GDP growth will drop to 5%: ADB

  Capital account turns negative

  Pakistan’s failed purchase of peace

  Persisting weakness

  Sanjay Dutt loses plea, can’t contest

  Article 14 does not apply to anything and everything: Katju

  British troops begin Iraq pullout

  UNHCR sets norms for protection of the displaced

  London summit’s burden of expectations

  An Indian space shuttle takes shape

  Secularism can’t be overstretched, says Katju

  First consignment of natural uranium arrives

  India and the East Asian maritime domain

  Russian-American relations: new hopes

  Spiritual practices

 

http://www.telegraphindia.com/1090219/jsp/careergraph/story_10554038.jsp

http://www.telegraphindia.com/1090219/jsp/careergraph/story_10554038.jsp

http://www.telegraphindia.com/1090219/jsp/careergraph/story_10555562.jsp

http://www.telegraphindia.com/1090219/jsp/careergraph/story_10555562.jsp

What Would Keynes Have Done?

The New York Times, November 30, 2008

ECONOMIC VIEW

What Would Keynes Have Done?

By N. GREGORY MANKIW

IF you were going to turn to only one economist to understand the problems

facing the economy, there is little doubt that the economist would be John

Maynard Keynes. Although Keynes died more than a half-century ago, his

diagnosis of recessions and depressions remains the foundation of modern

macroeconomics. His insights go a long way toward explaining the challenges

we now confront.

According to Keynes, the root cause of economic downturns is insufficient

aggregate demand. When the total demand for goods and services declines,

businesses throughout the economy see their sales fall off. Lower sales induce

firms to cut back production and to lay off workers. Rising unemployment and

declining profits further depress demand, leading to a feedback loop with a

very unhappy ending.

The situation reverses, Keynesian theory says, only when some event or policy

increases aggregate demand. The problem right now is that it is hard to see

where that demand might come from.

The economy’s output of goods and services is traditionally divided into four

components: consumption, investment, net exports and government

purchases. Any expansion in demand has to come from one of these four. But

in each case, strong forces are working to keep spending down.

CONSUMPTION The Conference Board reports that consumer confidence is

near its record low. It is easy to understand why consumers are so scared.

House values have declined, 401(k) balances have shrunk and unemployment

is up. For many people, the sense of economic uncertainty is greater than

they’ve ever experienced. When it comes to discretionary purchases, like a new

home, a car, or a washing machine, wait-and-see is the most rational course.

2

A bit more saving is not entirely unwelcome. Many economists have long

lamented the United States saving rate, which is low by international and

historical standards.

For the overall economy, however, a recession is not the best time for

households to start saving. Keynesian theory suggests a “paradox of thrift.” If

all households try to save more, a short-run result could be lower aggregate

demand and thus lower national income. Reduced incomes, in turn, could

prevent households from reaching their new saving goals.

INVESTMENT In normal times, a fall in consumption could be met by an

increase in investment, which includes spending by businesses on plant and

equipment and by households on new homes. But several factors are keeping

investment spending at bay.

The most obvious is the state of the housing market. Over the past three years,

residential investment has fallen 42 percent. With house prices continuing to

decline, increased building of new homes is not likely to be a source of robust

demand over the next few years.

Business investment has lately been stronger than residential investment, but

it is unlikely to pick up the slack in the near future. With the stock market

down, interest rates on corporate bonds up and the banking system teetering

on the edge, financing new business projects will not be easy.

NET EXPORTS Not long ago, it looked as if the rest of the world would save

the United States economy from a deep downturn. From March 2004 to

March 2008, the dollar fell 19 percent against an average of other major

currencies. By increasing the price of foreign goods in the United States and

reducing the price of American goods abroad, this depreciation discouraged

imports and bolstered exports. Over the last three years, real net exports have

increased by about $250 billion.

In the coming months, however, the situation may well go into reverse. As the

United States financial crisis has spread to the rest of the world, fast-moving

international capital has been looking for a safe haven. Ironically, that haven

3

is the United States. Since March, the dollar has appreciated 19 percent, a

move that will put a crimp in the export boom.

GOVERNMENT PURCHASES That leaves the government as the

demander of last resort. Calls for increased infrastructure spending fit well

with Keynesian theory. In principle, every dollar spent by the government

could cause national income to increase by more than a dollar if it leads to a

more vibrant economy and stimulates spending by consumers and companies.

By all reports, that is precisely the plan that the incoming Obama

administration has in mind.

The fly in the ointment — or perhaps it is more an elephant — is the long-term

fiscal picture. Increased government spending may be a good short-run fix,

but it would add to the budget deficit. The baby boomers are now starting to

retire and claim Social Security and Medicare benefits. Any increase in the

national debt will make fulfilling those unfunded promises harder in coming

years.

Keynesian economists often dismiss these long-run concerns when the

economy has short-run problems. “In the long run we are all dead,” Keynes

famously quipped.

The longer-term problem we now face, however, may be more serious than

any that Keynes ever envisioned. Passing a larger national debt to the next

generation may look attractive to those without children. (Keynes himself was

childless.) But the rest of us cannot feel much comfort knowing that, in the

long run, when we are dead, our children and grandchildren will be dealing

with our fiscal legacy.

So what is to be done? Many economists still hope the Federal Reserve will

save the day.

In normal times, the Fed can bolster aggregate demand by reducing interest

rates. Lower interest rates encourage households and companies to borrow

and spend. They also bolster equity values and, by encouraging international

4

capital to look elsewhere, reduce the value of the dollar in foreign-exchange

markets. Spending on consumption, investment and net exports all increase.

But these are not normal times. The Fed has already cut the federal funds rate

to 1 percent, close to its lower bound of zero. Some fear that our central bank

is almost out of ammunition.

Fortunately, the Fed has a few secret weapons. It can set a target for longerterm

interest rates. It can commit itself to keeping interest rates low for a

sustained period. Most important, it can try to manage expectations and

assure markets that it will do whatever it takes to avoid prolonged deflation.

The Fed’s decision last week to start buying mortgage debt shows its

willingness to act creatively.

It is hard to say how successful monetary and fiscal policy will be in avoiding a

deep downturn. But as events unfold, you can be sure that policymakers in the

Fed and Treasury will be looking at them through a Keynesian lens.

In 1936, Keynes wrote, “Practical men, who believe themselves to be quite

exempt from any intellectual influence, are usually the slave of some defunct

economist.” In 2008, no defunct economist is more prominent than Keynes

himself.

 

http://www.economics.harvard.edu/faculty/mankiw/files/Beyond%20the%20Noise.pdf

http://www.economics.harvard.edu/faculty/mankiw/files/Beyond%20the%20Noise.pdf