The Mint Road mavens, from RBI chief Shaktikanta Das to panel member Chetan Ghate, seem to be borrowing a leaf or two from the lexicon of legendary US Federal Reserve chair Alan Greenspan, who was once described as someone practicing the art of “constructive ambiguity”.
Closer home, Parliamentarian and erudite speaker-writer Shashi Tharoor’s usages have been lessons in vocabulary and one of them found its way in reference to the growth forecast by Monetary Policy Committee member Ghate.
“The estimates of economic growth have unfortunately been subject to a fair degree of floccinaucinihilipilification. Notwithstanding this, growth is likely to pick up,” he said during the previous three-day MPC meet, as per the minutes released on August 21.
The Oxford dictionary defines ‘Floccinaucinihilipilification’ as an “action or habit of estimating something as worthless”. The 29-letter word, one of the longest, is based on four Latin terms that mean “at little value” — flocci, nauci, nihili and pili.
Governor Das, a history graduate and unlike his immediate predecessors Urjit Patel and Raghuram Rajan who have reams of academic papers on economics and monetary policy, on August 19 left the Mint Road watchers and bankers scrambling for dictionaries to decipher his remarks at a banking summit in the financial capital.
Das invoked the French philosopher and novelist Voltaire in a speech on the economy. “I am not saying we maintain a Panglossian countenance and smile away every difficulty,” he remarked.
The dictionary meaning of ‘Panglossian’ is “a way of life characterised by one of extreme optimism”. The expression refers to Professor Pangloss, a character in ‘Candide, ou l’Optimisme’ or ‘Candide: Optimism’ — a satire written by Voltaire in 1759.
Earlier this month, the MPC unanimously voted for a rate cut and with a 4:2 majority chose an unconventional 35 basis points — the first in the history of the Reserve Bank, while the other two voted for a 25 bps reduction. The central bank has slashed rates four times in a row.
Maybe given the complex way the Street and the real economy have been behaving, policy wonks are trying to decipher more meaning into the crisis.
Ghate is an external member of the MPC and is a professor of economics and planning at the Indian Statistical Institute in the national capital.
If we look at the central bank languages elsewhere, especially in the US, there is something called the Fedspeak aka Greenspeak, which was full of indecipherable delphic dialects.
Those were usages that Alan Greenspan, one of the longest serving US Federal Reserve chairmen, popularised and were even derided as “a turgid dialect of English”, a parallel to the ‘newspeak’ language portrayed in George Orwell’s novel ‘1984’.
Greenspan was known for making wordy, vague, and ambiguous statements and the strategy was used to prevent the financial markets from overreacting to his remarks.
Some change started with his successor Ben Bernanke, who began to depart from the obfuscation that characterised the previous three decades of Fed communication. Later, Janet Yellen and Jerome Powell also preferred plain language instead of lengthy statements loaded with monetary policy jargon.
Though former Fed chairmen Arthur Burns and Paul Volcker were known for blowing smoke, both literally and figuratively, when appearing before Congress, Greenspan made it a high art.
It was said that Greenspan used to take pride in the resulting obfuscation — which he characterised as ‘mumbling with great incoherence’.
Once he told a senator who claimed to have understood him that, “in that case, I must have misspoken”.
In his 2007 book ‘The Age of Turbulence’, Greenspan said he used such confusing words to prevent unintended jolts to the markets as confusing statements were typically ignored.
He was so confusing that once two newspapers had opposite headlines from the same speech. To this, Greenspan responded that “then I succeeded’ — something BusinessWeek in August 2012 described as “practicing the art of constructive ambiguity”.
However, the average English-speaking Indians should thank Tharoor for introducing the word ‘Floccinaucinihilipilification’ to them. He had done this more than 14 months before Ghate.
The vocabulary of the very articulate Congress MP from Thiruvananthapuram of late has been replete with almost unheard of words such as ‘prurient’, ‘esurient’, ‘parturient’, ‘farrago’ ‘rodomontade’, ‘snollygoster’, ‘apposite’, ‘fatuous’ and everything in between.
To “all the well-meaning folks who send me parodies of my supposed speaking/writing style: The purpose of speaking or writing is to communicate with precision. I choose my words because they are the best ones for the idea I want to convey, not the most obscure or rodomontade ones!,” Tharoor had tweeted.
Maybe the central bank wonks too are treading the same path.