Vivek's Commentary

The speech given by Deputy Governor Viral Acharya intensified the conflict of interest between RBI and Central Government. Let's examine that. The real facts behind the conflict are not clear but the most highlighted issue is the transfer of reserves to reduce the fiscal deficit. The government of India is committed to reducing the fiscal deficit to 3% of GDP under the FRBM framework. In March of 2018, the target is revised and 3.5% becomes a new target. On the other hand, we have foreign exchange reserve of US$393524 million on 18th October 2018. It was $ 426082.4 million on 13th April 2018. It is declining from last few months.  Data source - Reserve Bank of India What if we use this reserve to control the fiscal deficit? One should understand that the RBI also holds the government securities and lend the money to the government. Therefore borrowing money and taking money will have a huge impact on inflation. This will put more inflationary pressure on the economy

All the characters and incidents in this writing are imaginary, resemblance to any person dead or alive is purely coincidental. The writer doesn’t intend to outrage, insult, wound or hurt any idea or the ideological sentiments, beliefs or feelings of any person(s) or class or community. Marx: Ohh what was that? It’s a disclaimer. It’s required. Marx: Ohh. You are living in a state. That’s why. In a stateless system, it won’t be required. Maybe. Maybe not. Okay, I don’t want to get into that debate. Today I want to discuss the first chapter of Capital – Commodities. Marx: Okay. Tell me what is the problem? I want more discussion on the use value. You said, “Use values become a reality only by use or consumption”. According to you, use value is different than exchange value. At one point you said, “As use values, commodities are, above all, of different qualities, but as exchange values, they are merely different quantities, and consequently do not con