Bankers aren’t boring any more. They discuss whether they are doves or hawks, as the RBI Governor appears to announce the monetary policy. Would his policy set the cat among pigeons? The cat: an unexpected hike in rates applied to commercial banks. And the pigeons: business heads of industries, who listen to every word the svelte financial official utters in rapt attention. Would the tweaking mean higher interest costs for the business or a respite, when all else is just too dreary? He has already proved that neither is his institution “caged” nor does he “parrot” the Centre’s lines. He has watched the flight of global money across borders, that sets currency markets aflutter in his previous instance. Now like the watchful eagle, he has set his sight on another soaring bird up in the sky – inflation!
But who’s listening? A retired senior may tune in to check whether interest rates would increase as inflation gnaws away at his meager savings, like a rat in FCI’s godown. Or the home-loan borrower, who cannot live like a cuckoo in a borrowed nest, with the hope that home loan interest rates do soften. The rare avid bird-watcher would be away in a wildlife reserve trying to spot a finch or an egret. He would not interested in this routine fiscal event. Neither would most youngsters who would be busy playing “Angry Birds”, “Flappy Birds” or perhaps tweeting. That’s as close as they get to birds in life. They know as much about birds as they know about personal finance - Zilch. As for me, I am easy game for real urban birds, it is their turn to play “Crappy Birds” - and I am their favorite target on Mumbai streets.
Springing a surprise is what he loves - no wonder interest rates move like flitting butterflies changing directions in a jiffy. Anyway, “Neither hawk, nor dove, but we are owls” declared RRR, referring to the stance the RBI took in announcing the latest monetary policy. He had been rather brave too. In a country, where an owl has been bestowed with the attribute of a fool – thanks to the Hindi phrase “Ullu”, and all who “banao” us well and proper “ullus”. Like, who in our country do you think knows that the West associates the owl with Wisdom? Or that the belief dated back to the Greek who believed that owls were wise since the Proto-Corinthian era circa 630 B.C.?
We in India would not care for such details, as we have been “made ullus” for ages by taxing the interest on bank deposits although the inflation has been higher. The Government has been taxing the money that we did not earn as “income”, but only just protected its value over time! We are so used to being “made owls” that we won’t even buy term-insurance as they don’t provide any “returns” or because some columnists asks us to be careful about insurance products which have low premiums!
So eager are we to become ‘ullus’ , that it has already become a widespread national affliction needing eradication. For this very reason, fly-by-night operators continue to con investors seeking higher than inflation real returns with their ingenious ‘get-rich-quick’ schemes. There are no legitimate means to beat inflation without losing an arm or a limb (read: invested capital). Like the magicians who produce doves from thin air, these financial magicians promise to double our hard earned money in double quick time!
When inflation eats away into our savings, some of us bury our head in the sand like an ostrich. That is the only way to deal with inflation, if we are not to fall for the scam-schemes. But we must hail the RBI Governor – he is not an ostrich like us, but an owl with his wisdom. He would like to rein in the soaring inflation for us all, so one would truly wish him all the success in this task. Just do that, Guv. It is time to ground inflation …like Kingfisher… er …. Airlines! Ok, we will not even call it Black Swan event if you do succeed.
(c) Gopinath Mavinkurve