Caselet on Devaluation

Topics: Inflation, Democracy, Investment Pages: 2 (644 words) Published: October 30, 2012
aseltTechno Consultants and the Inflation in Utopia !!!

Utopia is a hypothetical economy situated in Africa. For long Utopia was under military rule. Recently there was a people’s rebellion which overthrew the military despot and established a popular government through the first democratic elections in the history of the country.

The Government and the central bank of the country, The Central Bank of Utopia had an immediate problem to tackle. The country was facing a hitherto unprecedented high rate of inflation [of around 15%], which was believed to be largely attributed to excessive liquidity in the economy owing to booming private investment in the real estate sector of the country. The Government wanted The Central Bank to advise it on ‘what was to be done’- both from the perspective of the Central Bank and The Government. The Bank itself was undergoing the pangs of transition. Almost everyone in the director board of The Bank, except Mr. Jones the Chairman of the Recruitment Board of the bank, appointed by the military government had been sacked immediately after the democratic government came to power. Jones was appointed as the caretaker CEO till the reconstitution of the board would which was expected to take at least 2-3 weeks time. But the problem before The Bank warranted immediate solutions.

Jones had to act as quickly as possible. Jones, being a person from an HR background, wasn’t confident to handle the situation all by himself, which forced him to seek external help. Jones had worked with a bank in South Africa before he joined The Bank of Utopia. There, he had come across ‘Techno Consultants’, a consultancy set up by fresh MBA graduates from the Indian community in South Africa. At that time he was very much impressed by the work they did for his bank for a particular assignment. He decided to hire Techno Consultants to advice the bank on the right policy to be adopted.

In his initial conversation over the phone with Mr....
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