Which is the true face?

"Reserve Bank of India (RBI) governor Shaktikanta Das has yet again said that equity valuations do not reflect reality and has even linked it to financial stability," wrote Aparna Iyer. "Analysts at Kotak Institutional Equities pointed out that the stress model relied heavily on past trend and the report offered little clarity on the extent of stress beyond the headline numbers." "The report has warned that bad loans on bank balance sheets may double by September 2021 to 13.5%." Rajya Sabha MP Subramanian Swamy tweeted, "Trapeze Artist Adani now owes Rs 4.5 lakh crores (Rs 4.5 trillion) as NPA (non-performing assets) to banks. Correct me if I am wrong. Yet his wealth is doubling every two years since 2016. Why can't he repay the banks? Maybe like with the six airports he might soon buy out all the banks he owes money." To that the Adani Group said that the allegations are not true and that "it maintains an impeccable record of not a single NPA in three decades of its existence". Former US Federal Reserve Chairman Alan Greenspan called it "irrational exuberance", meaning that asset prices did not reflect fundamentals of the economy. "While the economy is expected to contract this year, the stock market has rallied 80%. How's this possible?" asked Vivek Kaul. It could be because investors expect economic growth to roar back in 2021, or excellent corporate earnings growth despite the slowdown, but also because, "Since February 2020, the RBI has pumped in a massive amount of money into the financial system through various measures, some of which involve the printing of money." The RBI said that "it has drained Rs 2 trillion of liquidity from the system via the 14-day reverse repo auction as it begins the process of normalizing liquidity operations," wrote Gopika Gopakumar. "I believe that we will see a strong wave of growth as any country has to grow after being down 25% of GDP," said Prof Raghuram Rajan. India's GDP contracted by 23.9% in April-June quarter of 2020. "I also worry about the structural damage done and you know damage done to households, damage done to children who now have been taken out of school for a long time or who have not been able to keep up with their classes and we need to prepare for all that," said Rajan. "Looking at the Sensex, one thinks problems are over. No they are just starting." The economy needs structural reform which has to start with good governance, said Rajan. About the RBI he said, "We in India tend to be very, very two-faced about institutions. On the one hand, we want to improve the institutions and on the other hand, we resent any potential constraints they place on us." "American brokerage BofA Securities on Friday said the Indian economy continues to be 'weak', pointing to activity indicators tracked by it." Rural India is no better off. "Surprising as it seems, the average employment per household was 48.40 days in 2019-20 when the number of families that worked under the job scheme was 5.48 crore (54.8 million). In contrast, the employment per household has gone down to 44.38 days in 2020-21 when the number of families has  zoomed to 6.90 crore." This is under the government MGNREGA scheme to help the rural poor. So, is the economy strong as shown by the stock market, or weak as shown by the increasing number of poor needing help? Janus-faced economy.