The first way is by making many people poor enough that their life expectancy falls because of degraded living conditions. Besides poor people have a lot less access to the kind of medical options that richer people have. For example because he had a Gulfstream V Steve Jobs was able to seek a liver over a much bigger distance -- wherever his plane could take him in 6 hours -- than someone without a jet.
Inflation is also a key driver of inequality. Especially that we now know that the inflation of the poor is about 3% higher than the headline number. Inequality will bring people to the streets -- like in the Arab Spring and elsewhere -- and clashes may cause loss of lives.
Of course if inflation is very high things can get very ugly. And that too on a horrendous scale. Like in 1930s Germany where hyperinflation helped put a little guy with a moustache in power. And the world eventually went to war: between 50 and 85 million people died in WWII.
No wonder then that Central Banks have been setting inflation targets for more than 25 years now -- roughly the period of time Lutchmeenaraidoo was not Finance Minister. With the blessings of their governments. As inflation is a major reason why politicians lose power. In fact we owe it to Governor Basant Roi for one of the best descriptions of inflation so far -- he likened it to radioactivity. Which makes it all the more interesting to check his inflation record. And compare it to Manou Bheenick's.
Inflation is also a key driver of inequality. Especially that we now know that the inflation of the poor is about 3% higher than the headline number. Inequality will bring people to the streets -- like in the Arab Spring and elsewhere -- and clashes may cause loss of lives.
Of course if inflation is very high things can get very ugly. And that too on a horrendous scale. Like in 1930s Germany where hyperinflation helped put a little guy with a moustache in power. And the world eventually went to war: between 50 and 85 million people died in WWII.
No wonder then that Central Banks have been setting inflation targets for more than 25 years now -- roughly the period of time Lutchmeenaraidoo was not Finance Minister. With the blessings of their governments. As inflation is a major reason why politicians lose power. In fact we owe it to Governor Basant Roi for one of the best descriptions of inflation so far -- he likened it to radioactivity. Which makes it all the more interesting to check his inflation record. And compare it to Manou Bheenick's.
shame on VL
ReplyDeleteVery few people in Mauritius will understand the connection between inflation and Hitler (simply because this is old and has never been part of our cultural knowledge anyway) - but oh you got it so right there!
ReplyDeleteVL pou mange la poussiere bientot, li p bandiner. inflation li un fleau difficlile a controller, alors ou pas besoin rode la gratelle in the first place.
ReplyDeleteGet sa dapres ene interview Bheenick meme si Ptr/MMM ti gagne elections li pas ti pou rester comme gouverner. Ti pou ena RS comme FM avec sirma ene paillasson comme gouverner qui ti pou oussi depresier nou roupie. En plus fidele a lui meme RS ti pou crase nou estra boucou. Avec zotte ti pour vine avec sa histoire 2e republique qui ti pour faire nou vine ene republique bananiere nette. Donc nous besoin content qui nou fine echappe depuis sa grand malheur la.
ReplyDeletehttp://www.defimedia.info/live-news/item/70846-jeff-gable-chief-economist-a-barclays-africa-la-roupie-se-depreciera-davantage.html
ReplyDeleteValeur de la roupie, lexpress, VL
ReplyDeletePour ce qui est des prises de position par rapport à la valeur de la roupie, le ministre des Finances a expliqué que le Fonds monétaire international affirme que la valeur de notre monnaie est 7 % plus élevée que sa valeur actuelle. «Il est aussi bête de parler d’inflation alors que celle-ci tourne autour de 3 %. Si à la fin de l’année elle atteint 5 % ou 6 %, je viendrai m’excuser.»
Le ministre a aussi annoncé que huit compagnies ont approché le gouvernement pour parrainer des poches de pauvreté. Le deuxième plus grand groupe du pays compte parrainer quatre zones.
La-flam, la-flam...
ReplyDeleteInteresting article which links living conditions to brain surface: children from lowest income group families will lose 6% of it. Something which Gladwell kind of covered. And given what the 'reforms' did we can only guess at the mess that's coming our way. Not a bad idea to switch off all the fans.
ReplyDeleteThe outgoing President of the MCCI lists low inflation as one three challenges. How do you like that? She also appear to be mesmerised by the WB Doing Business rankings. Oh boy!
ReplyDeleteKi zot dir sa desizyon bes repo rate alor ki inflasyon finn ogmante?
ReplyDeleteRational people have already warned us about the effects, but with Ramesh at the helm of BoM, all the gourma-laminn-dipin should be very happy that their blackmail of job creation is working, even if the threat never materialises. On the contrary, exporters give no guarantee of maintaining jobs, and some just close down and flee.
ReplyDeleteEta-eh soz, al lir inpé lor radioactivité ki pé dormi-dormi inpé - ki-ferr to pa goré enn tiginn lor to bann camouwad lott-péi lah? Enn tiginn oussi to kapav montt l'intere-lah pou nou'ssi ta-eh!
ReplyDeleteI hope you understood that you were meant to (try and) match the tone of his unwarranted outburst...
ReplyDelete(grumbling to myself why I missed the link!)