Quotes from Raghuram G. Rajan

decision by consensus is inherently conservative.

The picture of bankers slavering after bonuses soon after they had been rescued by government bailouts was not only outrageous but also pitiable - pitiable because they were clamoring for their primary measure of self-worth and status to be restored

the single most important task in management is to pick good deputies,

developing countries typically have higher inflation, and developing countries also have higher growth.

firms do not borrow as much to invest when rates are higher and individuals stop buying durable goods against credit and, instead, turn to save. Lower demand growth leads to a better match between demand and supply, and thus lower inflation for the goods being produced.

It involves considerable change, and change is risky. But as India develops, not changing is even riskier. We have to keep what is good about our system, of which there is a tremendous amount, even while acting differently where warranted.

Politicians today vow, "Never again!" But they will naturally focus only on dealing with a few scapegoats, not just because the system is harder to change, but also because if politicians traced the fault lines, they would find a few running through themselves.

in a system where relationships are the currency of exchange.

the willingness to be ruthless helps innovation.

The eventual aim was to build a 4,000-acre high-tech park, called Alpha Technopolis, to rival Taiwan's famous Hsinchu Science-Based Industrial Park. The vision was grand, perhaps overly so.

Past experience and relationships are of little value in driving radical innovation: indeed, because the natural human tendency is to do more of the same and to serve existing clients and needs well, past relationships can be positively detrimental.

Indeed, as we will see in the book, healthy communities are essential for sustaining vibrant market democracies. This is perhaps why authoritarian movements like fascism and communism try to replace community consciousness with nationalist or proletarian consciousness.

Finally, the people in industrial democracies, engaged in their communities and thereby organized socially and politically, enforce the necessary separation between markets and the state through their democratic voice. They do so because they want sufficient political and economic competition that the economy does not descend into authoritarianism or cronyism.

When the proximate community is dysfunctional, alienated individuals need some other way to channel their need to belong.4 Populist nationalism offers one such appealing vision of a larger purposeful imagined community—whether it is white majoritarianism in Europe and the United States, the Islamic Turkish nationalism of Turkey's Justice and Development Party, or the Hindu nationalism of India's Rashtriya Swayamsevak Sangh.

Even outside the EEC, global trade grew as new multilateral organizations like the General Agreement on Trade and Tariffs pushed for lower import tariffs across the world. The IMF helped, monitoring exchange rates so that no country attempted to get an undue advantage from the increased openness by depreciating its exchange rate and exporting more—the "beggar-thy-neighbor" strategy that was much feared during the Great Depression.

Apart from the added efficiency, the willingness to be ruthless helps innovation. Past experience and relationships are of little value in driving radical innovation: indeed,

By focusing only on jobs and inflation—and, in effect, only on the former— the Fed behaved myopically, indeed politically.

Two of the pillars I focus on are the usual suspects, the state and markets. Many forests have been consumed by books on the relationship between the two, some favoring the state and others markets.

Policy making invariably involves taking measured risks in the face of uncertainty, for one has neither a prior template nor the luxury of indecision. As an aside, that initial

The personal checks and balances that most of us bring to bear when we are employed in other activities - we ask ourselves if we are producing a socially useful product - operate less well in finance because, with few exceptions, making money is the Raison d'être (reason for existence) for the financier

a dollar's worth of physical capital in India would produce 58 times the returns available in the United States. Global financial markets, he argued, could not be so blind as to ignore these enormous differences in returns, even taking into account the greater risk of investing in India.

Eurosclerosis was the term German economist Herbert Giersch used to describe Europe's slow growth and high unemployment, brought about by the postwar accumulation of regulations and social protections.

The bottom line was that the scheme was a measured risk, with a probability that the RBI would lose money, a certainty that the bankers would make money, but also a reasonable chance that the country would be significantly better off.

As wages in domestic currency rose faster in France and Southern Europe compared to Germany, they needed a steady depreciation of their exchange rate in order to retain competitiveness. Corporations disliked having to manage the resulting exchange rate volatility