Discussions on macroeconomic policy in the US and other high income countries tend to focus overwhelmingly on central banks' interest rate adjustments, with little clarity on what impact those changes have domestically.

There is a paradox at the core of the efflorescence of science that has occurred over the last millennium. In essence this efflorescence has the potential to increase human freedom immensely.

There are fundamental objections to the plan of the government to privatise at least some of the public sector banks. They centre around the fact that such a move will change the pattern of deployment of credit, away from productive activities towards speculation, away from peasant agriculture towards big business (with dangerous implications for peasant viability, food security and employment), and away from domestic to global destinations.

The RBI, in deciding its rescue package needs to distinguish between liquidity risk and solvency risk. Rescuing mutual funds which, despite SEBI guidelines, chose to invest in high-risk debt securities may encourage such errant behaviour.

Under Covid-related uncertainty, as investors desert global markets and seek safety in the US, the Fed has decided to deploy swap lines to ease dollar-funding strains in countries that matter. India is not yet among them.

The flight of footloose portfolio capital from India has attracted attention because of its impact on stock indices and the value of the rupee. But the bigger danger is of a debt shock that can be more damaging for the corporate sector.

Financial flow has shrunk drastically in recent months, affecting the real economy in multiple ways. But the problem is systemic, arising from investment decisions driven by the euphoria of neoliberal reform that proved to be wrong. Minor measures to increase credit flow may not be the solution.

Lowering interest rates to revive economic activity has been ineffective, because the global slowdown since 2008 is not the result of "dented animal spirits" of capitalists, but the contractionary and inequalizing tendencies of neoliberal capitalism.

The sudden and steep rise in the repo rate signals a major liquidity crunch in the US money market, and even urgent action by the US Fed to bring rates down might not be able to prevent an economic recession.

The Modi government's demonetization move has been universally criticized, but there are significant differences between a neoliberal critique focused on the impact on GDP and the Left's assessment that looks at the impact on people.

The problem of large NPAs of nationalised banks can be traced to the neoliberal reforms in the financial sector and outside, which prevent large government investments in infrastructure and capital-intensive industries that are imperative for development but too difficult a responsibility for the private sector to shoulder.

Rising interest rates in the domestic market have been encouraging large firms in the Indian corporate sector to resort to foreign borrowing to finance domestic expenditures. In particular, there has been significant rise in the shares of commercial borrowings and short-term debt in total external debt. This tendency is increasing external vulnerability.

The price trends over the last one-and-a-half years suggest that inflation is being driven by factors which are structurally embedded in the economic environment generated by the government's neoliberal reform agenda adopted for two decades now. Further, neoliberal thinking is leading not only to policy paralysis and absurd reasoning, but also to policy responses that are contrary to what is needed.

Recent inflation in India is special both because of its peaks and its persistence. It is argued that unlike during 2008-09, recent inflation is due to structural problems. Further, a distributional analysis reveals that its impact is not shared equally. People in the lower income groups have been facing uncommon difficulties, as their purchasing power seems to have been halved over the last four years.

The injection of cheap money at home to invest in emerging markets for profit by the US Federal Reserve, and its pressure on emerging market economies to allow their exchange rates to appreciate, in the hope that it would expand US exports and reduce its imports and facilitate a recovery, are a sure recipe for conflict.

The spike in stock prices and the strengthening of the rupee are signals that it is time the government acted to regulate the capital flows that are generating these speculative trends. But while the government and the central bank are responding to inflation in the prices of goods, they are choosing to ignore the much sharper inflation in asset prices.