ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846
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Status and Flatus-A Comment

But now all protagonists of equality seem to have risen against a planned subsidisation of weaker sections through lower interest rates. The majority argues that the monetary system offers less scope for re-distribution than the fiscal system as there is a recurring element in the latter supposedly absent in the former. This assumes that bank loans are to be fossilised with the same borrowers. This has indeed been the case as far as large borrowers are concerned, but it only shows the inertia of bank managements. Even when companies are such prized possessions as to become the objects of proxy wars and take-overs, no banker has thought that companies which have a high market rating should be asked to raise funds on the market. Once adequate collateral is provided, these large borrowers become entitled to bank funds and remain so indefinitely.

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