b mahapatra : the global financial crisis – new awakening address of mr b mahapatra, executive director of the reserve bank of india, at the convocation ceremony of chetana ’ s institute of management & research, mumbai, 21 january 2012. * * * the contributions made by smt usha janakiraman and tariqa singh are gratefully acknowledged. 1. shri shirish choudhary, honorary secretary, chetana trust, dr. ashok choudhury, trustee member, smt. madhumita patil, chief executive officer, dr. m. v. deshpande, director, chetana ’ s institute of management & research ( cmir ), other eminent dignitaries on the dais, guests, and distinguished faculty members, graduating students, relieved parents and family members : it is a great pleasure for me to deliver the convocation address today for the batch of 2011 at the chetana ’ s institute of management & research, which has evolved as a premier management institute. it would be in the fitness of things to pause for a few minutes and remember the founder president of the chetana trust : late shri madhukarrao chaudhari, philanthropist, former education & finance minister, maharashtra and speaker, maharashtra legislative assembly. his vision was to develop chetana as a world class institute of academic excellence and to develop outstanding business professionals who make valuable contributions to the corporate world and society. this vision has been achieved through the rapid strides made by the institute in the past several years in the field of management education and research. 2. i am privileged to be here today on an occasion which is both joyous and solemn. for many of you, this day will be an extremely happy one and an important milestone in your life. you are graduating from a student life to a corporate life with a splendid future in front of you. opportunities in india today are at par with the best that the world has to offer. when you reach my age, india will, in all likelihood be in the forefront of nations that have eliminated poverty and entering the ranks of advanced economies. some of you would have created companies, while some others would have climbed your way to the top of the corporate ladder. some among you may have chosen to become academicians and a number of you will choose to dedicate your life to social work. 3. undoubtedly, you will also a have feelings of sadness today and in the days to come. campus life creates a coco

jean - claude trichet : the changing role of communication introductory remarks by mr jean - claude trichet, president of the european central bank, at a dinner with members of the “ internationaler club frankfurter wirtschaftsjournalisten ”, frankfurt am main, 15 december 2008. * * * ladies and gentlemen, a very warm welcome to all of you and thank you very much for your invitation to this club evening. i am happy to see many familiar faces in the audience tonight. communication is a very important issue for all times. being here in frankfurt i am thinking of the very profound remark by goethe : “ niemand wurde in gesellschaften viel sprechen, wenn er sich bewuβt ware, wie oft er die anderen missversteht “. nevertheless let me be bold enough to share with you some thoughts on communication and central banks. communication is a key element for central banks to enhance the effectiveness, predictability and credibility of their monetary policy decisions. it becomes even more important in difficult times, when the economic outlook darkens and confidence weakens. it seems to me that central banks have improved their communication significantly in good times – and also in bad times – while some years ago communication was almost seen as a breach of their professional code. why this change? why did central banks decide to become transparent? prior to the 1990s, central banks were very much working on the assumption that monetary policy effectiveness is greatest when the central bank systematically surprises the markets. the old belief was based on the notion that a central bank would measure the success of its actions by the extent to which economic activity could be raised and maintained above potential. if rational individuals already expect a certain change, they adjust their behaviour to that expectation. and that means that a monetary policy change would have no effect. in the past fifteen years, however, two important developments changed the theory and practice of central banking. first, the assumption that successful monetary policy acts by surprises and is made by a sequence of isolated steps has been the subject of thorough theoretical scrutiny and is now close to oblivion. it became clear that policy - making by surprises and isolated steps will bear no lasting effect on the economy once the public recognises the intentions that motivate the monetary authority. a monetary policy strategy made of isolated actions with the intention of boosting output above potential is bound to lose effectiveness because the short - term inflationary impact of that policy soon becomes embedded in price and