Posted by: Tanmoy Chakrabarti | November 24, 2008

Worse than the worst

While the financial crisis spread its tentacles and engulfs each and every person in this world, I wonder why did we as global citizens have to see this day? The crisis affects people like us – the normal people, who have little say in the worldly affairs. It affects the underprivileged people much more who have been long suffering from hunger and malnutrition. With every passing day, it makes the globe uncertain and traumatic. It challenges the faith on decision makers and renders all rules and controls to ensure welfare for everyone ineffective.

What amuses me that none of the Nobel winning (and several other stalwarts) Economists, multilateral organisations like UN, IMF, World Bank and WTO could foresee this state. Even if they did foresee they did not ensure that this does not happen. What is the accountability of economic research and theories if everything comes down to crisis management?

I wonder whether terrorism inflicts more harm to the world or a situation like this? To my mind, undoubtedly the later as scenarios that the current ones breeds terrorism as it makes the world take a step backward in ensuring better livelihood for the globe.

If this results in more harm that what terrorism does, then why not someone would be put into a trial for ignoring the fact, that in a unipolar world a country’s Premier needs to be much more responsible? However, after all this it is difficult to expect a trial for irresponsibility. Many of the decision makers would have a merry Christmas but the largest proportion of the world would seek the prayer rooms.

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Responses

  1. here’s my two cents. The world financial system has always been one of checks and balances. There is no place for irrational behavious. Let me define irrational behaviour as any process or activity that is not based on sound principles. This current crisis was precipitated in some measure by the philosophy that “everyone has a right to own a house”. Lots has been written about the sub-prime loan crisis and how the system that was used to hedge exposure was in itself a cardboard fortress.

    Everytime we allow a sentiment to cloud our judgement and make decisions that go against our prior experiences – we take on a huge risk. Nothing wrong with taking risks, but we need to be careful to limit our exposure. In essense, the banks put their entire wealth on the roll of a dice.

    In this case the intentions were good. People were acting in good faith. Thats the difference.

    But capital markets are evolving. Even after 10 years on a motorcycle, I fell off and nearly ended up under a bus. Was it the buses fault, my fault or the fault of that ()*&(*&## that spilt oil on the road? If I had worried about whose fault it was I’d have become the bumper ornament for a PATC bus. The situation demands quick decisive action, we can worry about repurcussions later.


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