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<b>Letters:</b> Executing 'helicopter drop'

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Business Standard New Delhi
Last Updated : Apr 02 2013 | 9:03 PM IST
Apropos Alok Sheel's article "The central banker's Brahmastra" (April 2), it is clear that quantitative easing (QE) and credit easing are not as effective to serve the objective of a country in recession. Capital-infusion through the financial system without the money multiplier has done no good to inflation, output and credit demand. Despite the fact that money has been pushed into the system on a massive scale, asset values have not grown significantly so as to allow economic units to reap the benefit of their wealth. The "helicopter drop" would at least provide direct benefits to the recipient to utilise the money in the manner he wishes to do. However, no mechanism has so far been invented by any banking or financial institution through which each consumer can enjoy the benefit of a QE splurge.
R K Arya Faridabad

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First Published: Apr 02 2013 | 9:02 PM IST

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