A bench of the Supreme Court recently said: “When you say it is the world’s oldest profession and when you are not able to curb it by laws, why don’t you legalise it?” Really? While dealing with a PIL filed by Bachpan Bachao Andolan about large scale child trafficking in the country, a Supreme Court bench of Justice Dalveer Bhandari and Justice AK Pattnaik are reported to have advised the...

The collapse of the Dubai dream is not without any implications; it may be an indication that the travails of finance capitalism are not over. GLOBAL capitalism is in a phase in which it must deal with the fruits of the overextension during the previous boom, and there is no doubt that this is going to be painful. The financial crisis in the United States and some other developed countries...

The recession was less calamitous than many feared. Its aftermath will be more dangerous than many expect IT HAS become known as the “Great Recession”, the year in which the global economy suffered its deepest slump since the second world war. But an equally apt name would be the “Great Stabilisation”. For 2009 was extraordinary not just for how output fell, but for how a catastrophe was averted. Twelve months ago,...

Government and regulators need to focus on the systemic risk engendered by excessive compensation. As calendar year 2009 draws to a close, it is bonus season for the financial sector in the West. In the last several months, the need to cap bonuses and compensation packages has been extensively discussed in the context of limiting the future impact of the next financial sector breakdown. On December 9, 2009, the UK was...

After dedicating most of 2009 to jump-starting financial markets through stimulus packages, developed countries are now turning their attention to reforming the basic architecture of those markets, especially the incentives for risk-taking. In a major step towards regulating systemic risks, the United Kingdom last week announced a one-off 50 per cent “super-tax” on bankers’ discretionary bonuses exceeding £25,000. The move could raise £550 milli on, which would be used to...