Mukti

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  1. Who’s the best? « Mukti said, on March 11, 2012 at 3:38 pm

    [...] from over.  And my data run to no later than 2011 financial year (that is, 30 June 2011).  Given the serious risks, there is a good chance that by the end of the government’s term, the points will look quite [...]

  2. Diganta said, on May 3, 2012 at 12:25 am

    This is a ‘WOW’ post. Thanks for getting the data and doing the hard analysis on it. Somehow I feel a lot of emerging economies are in this red-hot state and India is one of the prime example of it. For India, the current account deficit and inflation are the top two reasons. But due to its size, I still believe India will get a soft landing.

    • jrahman said, on May 5, 2012 at 3:38 pm

      You’re probably right re: India. At least I hope you’re right. The thing is, a country like India or China, where entire generations are now used to rapid growth, hardlanding doesn’t mean full blown recession. Even if growth dips to, say, around 4%, there will probably be major sociopolitical repercussions. India is in a vulnerable position also because of its macro policy constraints (see the latest post) — if India’s growth slows to 4%, it will not be able to stimulate the economy without risking a debt crisis, and if growth slows to below 4%, there will be a debt crisis. Again, it probably won’t happen, but the risk is very much there.

      • Diganta said, on May 7, 2012 at 11:36 pm

        History says debt crisis are good for India, because that’s when Govt took most bold decisions. :)

  3. Wiggly party? « Mukti said, on May 5, 2012 at 6:44 am

    [...] by the Economist to see whether the Bangladeshi economy was overheating.  The verdict was that ‘it was getting hot’.  An overheated economy is not only more vulnerable to an external shock, it also usually leaves [...]

  4. Compared to what? « Mukti said, on June 27, 2012 at 5:17 pm

    [...] development, the current government is actually performing remarkably well.  Sure there have been risks.  And the Bangladeshi economy has definitely dodged some bullets.  But the fact is, as of June [...]

  5. [...] Well, 2011 was a time of multiple monetary and financial shock to the economy.  The DSE bubble burst (that something peculiar was going on became obvious much earlier, and actions then would have spared us from the volatility of 2011).  The Bangladesh Bank printed money to pay for the government’s quick rental power plants.  The imported fuels needed for these plants pushed us towards a balance of payments crisis, and in the year to January 2012, taka depreciated by 17% against the dollar.  With double digit inflation (not just food prices, but all consumer prices), by late 2011/early 2012, the economy appeared to be overheating. [...]

  6. […] The government’s electricity record is something I’ll leave for another time.  For now, let’s accept that electricity is important, and put aside the question of whether subsidies are appropriate.  The relevant issue for us is, how the fiscal blowout caused by the mistaken fuel price assumption and the subsidies were paid for.  In late 2011, when the full fiscal cost of the rental power plants was becoming apparent, the government resorted to borrowing, including from the Bangladesh Bank (Chart 3) — that is, printing money.  This directly pushed inflation up, and put Bangladesh at risk of a crisis. […]

  7. […] The government’s electricity record is something I’ll leave for another time.  For now, let’s accept that electricity is important, and put aside the question of whether subsidies are appropriate.  The relevant issue for us is, how the fiscal blowout caused by the mistaken fuel price assumption and the subsidies were paid for.  In late 2011, when the full fiscal cost of the rental power plants was becoming apparent, the government resorted to borrowing, including from the Bangladesh Bank (Chart 3) — that is, printing money.  This directly pushed inflation up, and put Bangladesh at risk of a crisis. […]


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