The Economist Who Predicted the Financial Crisis

The economist who predicted the financial crisis just sounded another alarm—it would be wise to listen this time

By Manuel Hinds September 22, 2013

Manuel Hinds is El Salvador’s former finance minister. He also has worked with the World Bank in the public and private sector. In 2010, he won the Manhattan Institute’s Hayek Prize.

Raghuram Rajan, left, was not afraid to take on Alan Greenspan. And now, he’s sounding another clarion call as India’s new central banker. Reuters/Danish Siddiqui

In his first official act as the new governor of the Reserve Bank of India (RBI), Raghuram Rajan raised the benchmark interest rate from 7.25 to 7.5%, causing a ripple of surprise in financial circles and eliciting protests from various business representatives. But for people who know the current condition of emerging markets and Rajan’s professional trajectory, this was not surprising, at all.

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