Missing the punchline

On Tuesday, reporters raced each other out of a banking summit in Mumbai to file their stories without waiting for the punchline. The unlikely humourist was D. Subbarao, governor of the RBI, a rather humourless institution. But when the economy is a black joke — black as coal, in fact — he can perhaps be excused his attempt to lighten up.

Subbarao prefaced his talk on the Basel III banking regulatory framework with an "important announcement". Late the night before, he said, he had appointed a committee to look into the possibility of abolishing the credit reserve ratio — the fraction of deposits that retail banks must deposit with the central bank. The members would be his deputy K.C. Chakrabarty and SBI Chairman Pratip Chaudhuri, who had recently had an unseemly spat over CRR, when the latter pressed for its abolition. Subbarao said that the two antagonists would be locked up in a room and not allowed to emerge until they had a solution — which could not be earlier than the end of his term as RBI governor.

By this time, Subbarao was grinning while the audience roared with laughter. Even the densest reporter could not fail to get the joke. So was this a case of newsbreak hunger, or was there more to the story? Financial news can trigger market movements within minutes and indeed, confusion in the bond market followed, bringing on a spurt in bank stocks. Market pundits have been exhorting Subbarao to sober up, but perhaps that message should be directed at the media. If it reports a joke, it should stay with the story till the punchline. Or the joke would be on the media.

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