Financial Crisis- Some Old Questions and Maybe Some New Answers
Dr.DuvvuriSubbarao, Governor, Reserve Bank of India delivered C.D. Deshmukh Memorial Lecture at Council for Social Development, Hyderabad on August 5,2010. He raised five question and shown that how crisis has possibly thrown new answers. Q. 1. Have emerging market economies (EMEs) decoupled from the advanced economies? Pre-Crisis-An Increasingly Assertive ‘YES’ Post Crisis- Q uite Nuanced Q.2.Should central banks persist with pure inflation targeting? · Pre-crisis- An Increasingly Confident ‘YES’ · Post-Crisis- An Increasingly Qualified ‘YES’. Q.3.Should financial stability be an explicit mandate of central banks? · Pre-Crisis- No Answer · Post Crisis- Mostly ‘YES’ Q.4.Are controls an appropriate mechanism for managing the capital account? · Pre-Crisis-Largely ‘NO’ · Post Crisis- Qualified ‘YES’ Q.5.Has fiscal dominance of monetary policy ended? · Pre crisis-‘Hopefully’ · Post Crisis-‘Ho
