......A hypothetical question, though one relevant from the perspective of central banking, is, would Dr Rajan -- the top-notch academic who has often warned about the shortcomings of an excessive reliance by developed economies on central banks and monetary policy to fix their problems, and not enough on structural reforms -- have recommended such swap windows if he were not a central-bank governor? In other words, did Governor Rajan, the practitioner, lower the bar for policy options, from doing what is primarily right but painful in the short-term to doing what should be a no-no even if it is effective in the near term? The above is not a new dilemma for central bankers........
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