Why India didn't have a financial crisis

http://www.huffingtonpost.com/robert-kuttner/ask-dr-reddy_b_533328.html

Attending this founding conference of the George Soros-funded Institute for New Economic Thinking, at Kings College, Cambridge, one appreciates how much the Obama Adminstration could learn from thoughtful foreign observers of the financial crisis, who are far ahead of American thinking. Take the case of Dr. Yaga Reddy, the former Governor of the Bank of India, who addressed the meeting.

India had no financial crisis. Its high rate of economic growth continued unabated. Why? Because Reddy, over the objections of Western bankers, International Monetary Fund kibitzing, and kindred local banking pressures, simply did not allow the Indian banking system to engage in Wall Street-style speculation.

I first met Reddy at a U.N. conference in 2008 just as the financial meltdown was going critical. I asked him how India had managed to dodge the bullet. "We are a poor developing nation," Dr. Reddy said puckishly. "We don't really understand these securities, so we don't permit our banks to use them. We leave them to the advanced nations like you."

How did Reddy manage that trick? First, banks that wanted to issue complex securities were required to hold capital reserves against them. That requirement shut down the game of bank-sponsored gambling that crashed the American system. Second, as Reddy told me Saturday, the Indian central bank didn't just rein in banks. It also regulated other financial players.

For example, if a financial services company wanted to issue securities against car loans, or credit cards, Reddy also required them to post reserves. So none of the extreme leverage that afflicted the US financial system infected India. The Indian bankers who condemned him earlier in the last decade for denying them profits are now praising Reddy as a prophet.

I asked Reddy if he anyone in Washington was seeking his counsel. "No," he said. "If they want to ask me, I am in Hyderabad."

manufacturing jobs that went lock, stock and barrel to India and left us jobless in a number of cases.

The main point is "banks that wanted to issue complex securities were required to hold capital reserves against them"

to lecture me at this time of morning.

I'm UK.

Good morning :hi:

Muslim nations didn't suffer either because Sharia laws prohibit 'gambling as banking'

Or their economy won't grow.

There is such a thing as taking too large chances, true. But taking none at all would let others pass you by.

If the economy had tanked, Indian banks would have tanked.

Why the insistence in maintaining exponential growth at the cost of the rest of society?

The "strong growing economy" is a propaganda tool, put in place to make you sympathize with the people who are raping you, making you think the savage assfucking you're taking against your will isn't actually so bad.