The New Financial Resolution and Deposit Insurance Bill of 2016 outs itself with its use of the phrase “creative destruction” to endorse the need for a quick resolution of bank and firm failure.
“Creative Destruction” in this usage is a Marxist term, popularized by the economist Schumpeter and subsequently appropriated by neo-liberal economists, as well as perpetual-war- theorists of the new world order, that describes the need for “capitalism” to “ceaselessly devalue existing wealth (whether through war, dereliction, or regular and periodic economic crises) in order to clear the ground for the creation of new wealth.”
“Isms,” however, do nothing. So I would replace the word “capitalism” there with “capitalists.”
And, being of a skeptical turn of mind, would replace even “capitalist” with “globalist cabal manipulating capital.”
As I blogged before, the reassuring sound of “deposit insurance” should not blind us to the fact that the bill actually demotes protection of depositors – the original mandate of the RBI act of 194 – to second place. The RBI’s new mandate is the ubiquitous one of “financial stability.”
On behalf of financial stability – which, in effect, means some institutions are “too big to fail, too big to jail,” the new bill and the proposed new bankruptcy procedures – get around the standard Indian legal procedure and have complete authority to resolve any issue of bad debt, by winding up the firm/bank and/or restructuring the debt. In essence, that means, a small, overarching and centralized outfit can decide whom to bail out, whom not to, and who gets to foot the bill.
Bank depositors over 1 lakh (Rs 100000 or about $1800-2000) are unsecured creditors of the bank who will be stiffed in the face of senior debt holders.
In short, grandma takes the punch for the globalists.