Currency Demonetisation and Future course of Indian Economy

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vijayk
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Re: Currency Demonetisation and Future course of Indian Economy

Postby vijayk » 13 Nov 2016 22:02

IndraD wrote:Jaggi has written on Swaraj Mag
Before undertaking this
what stopped the government from promoting e-wallets and mobile money, the infrastructure for which was ready six months ago? Why does it require only commercial operators like PayTM or private banks to entice people into digital money? If millions of Africans can use mobile phones for their daily transactions, it beggars the imagination that we are so slow to push the idea#
any expert comment?


Good observation.

I also think they should incentivize people to voluntary disclosure by reducing penalties.

We are corrupted in our thinking for generations. We don't want to pay even 5% and here we are trying to make the people join main economic stream by paying taxes of 45% during amnesty and 30/60/90% NOW.

You have to incentivize to acquire customers and reduce the tax burden. Same thing with taxes like registration tax etc.

What BJP and COngis don't understand is instead of 12.5% of taxes on 1000 crores of white transaction, if they collect only 4% of 4000 cr, they get the same money. Use incentive to bring people into system and keep all the money white.

Instead they impose huge burden and let people run away

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Deans » 13 Nov 2016 22:22

abhischekcc wrote:
JohnTitor wrote:Mohd - I am unsure what your grief is. You seem to be moving the goal posts all the time.

First you say, noone has black money and there will be no demand, then you say there is no liquidity..

Can you succinctly - in one line (not sentence) state what it is that has changed on a fundamental level? I genuinely want to understand and respond through discussion

John bhai,

Try running a business in India, then no one will need to explain what the problem is.


I have run a business in India and am as unclear as John as to what the rants are about.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Sachin » 13 Nov 2016 22:23

bharotshontan wrote:Would like to ask a question at logistical level. Say local goon lines up 50 villagers to deposit 1lakh into their JDY accounts each and promises them 10-20% commission. What is preventing the villagers from depositing the money and then just keeping it? Is it muscle power of the goons?

This approach has been reported from Northern districts of Kerala. What the goons (Hawala agents) do is to line up people with some ID proof and make them deposit the money into their own accounts. But then the IDs which they used are "seized" by these agents, who would only return that back once the chappie who pushed the money to his account, with draws and gives it back. The jokers do not know that this chappie may be asked to show some proof on how he receieved the money in the first place.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Sicanta » 13 Nov 2016 22:26

IndraD wrote:Jaggi has written on Swaraj Mag
Before undertaking this
what stopped the government from promoting e-wallets and mobile money, the infrastructure for which was ready six months ago? Why does it require only commercial operators like PayTM or private banks to entice people into digital money? If millions of Africans can use mobile phones for their daily transactions, it beggars the imagination that we are so slow to push the idea#
any expert comment?


We have UPI (unified payment interface) by NPCI. I am using Bank Of Maharashtra app and have linked 3 separate accounts, through which one can transfer 10 to 1 lakh immediately unlike say NEFT. Just need to know other person id which may be his mobile no or email id. Though i agree that the app has not been promoted properly so far.

So far 26 banks have joined in.

and India Post Payment Bank is to start next year. It will make use of mobile phone to provide last leg connectivity in rural areas as well as say those employed in cottage industries, etc.
Last edited by Sicanta on 13 Nov 2016 22:36, edited 1 time in total.

Suresh S
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Re: Currency Demonetisation and Future course of Indian Economy

Postby Suresh S » 13 Nov 2016 22:35

I like this surgical strike on black money. Aap ko bhi hum maan gay modiji, wah kya jor se mara.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby vijayk » 13 Nov 2016 22:36

User Actions
Dhanya RajendranVerified account
@dhanyarajendran
Salt tweet, did only on basis of two shops. Will tell Ulsoor station. Should not have said 'bangalore too', so deleting it


see how rumors are being spread

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Amit Patel » 13 Nov 2016 22:38

IndraD wrote:Jaggi has written on Swaraj Mag
Before undertaking this
what stopped the government from promoting e-wallets and mobile money, the infrastructure for which was ready six months ago? Why does it require only commercial operators like PayTM or private banks to entice people into digital money? If millions of Africans can use mobile phones for their daily transactions, it beggars the imagination that we are so slow to push the idea#
any expert comment?


There is an entire section of population that despite having access to net banking and credit cards is unwilling to use them.

I for one fall into this category. I had a CC for a long time ... unused for 1 year and got cancelled.
Planning to reactivate the same and change my future financial management.

There is also an entire populace that is borderline crorepati and engaged in sme who manage their personal tax and finance in such a way that they end up officially paying zero to no tax, which I believe needs to change.

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Re: Currency Demonitisation and Future course of Indian Economy

Postby srinebula » 13 Nov 2016 22:41

They extended it to property tax also. Telangana Govt. said people can pay fines for regularizing their illegal constructions also using demonetized notes.
Today again there were reports of record collections.

There were reports of officers in RTC hoarding away currency from bus conductors, and replacing it with demonetized notes. This has two negative impacts: these thugs are able to convert their BM; also this will affect circulation of currency as they are actively sucking out valid money and are pumping invalid money.
There was twitter talk about money being laundered at petrol pumps using similar mechanism.

srinebula wrote:I saw on TV Hyderabad water board claiming they have received Rs. 40 cr payments today in old 500/1000 notes.
I am wondering if Babus are somehow channeling BM through utilities payments route. I can't figure this out; This money will have to go into the board's bank accounts; so, probably there is no easy way for them to take it back. Is it possible they are just dumping their BM into the utility instead of burning it. By enriching the utility with their BM, they my have a better chance later to take a cut into it.

I think many of the state Govt.s might try to exploit these loopholes and get some of their BM converted. Let's say CM level they decide to pump lot of BM into utilities through utility payment route. Since these utilities are fully under state Govt. control, they may easily siphon off this money.
Just some thoughts.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Sicanta » 13 Nov 2016 22:41

Yeah, my parents too had this habit of withdrawing money from the bank directly as needed. Finally they are willing to start using their debit cards. I have also set up upi on their mobiles so atleast any transactions between us is a 30 secs job tops.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Deans » 13 Nov 2016 22:42

shiv wrote:
bharotshontan wrote:Would like to ask a question at logistical level. Say local goon lines up 50 villagers to deposit 1lakh into their JDY accounts each and promises them 10-20% commission. What is preventing the villagers from depositing the money and then just keeping it? Is it muscle power of the goons?

Yes.


It wont work if there are actually 50 villagers depositing money. More likely the goon's `accountant' who deposits money into 50 accounts
he created, in connivance with the bank branch manager, using 50 aadhar cards.

It would be worthwhile for the Govt to announce a whistle-blowers scheme where a proxy depositor can retain the money deposited in his
account if he reveals the name of the BM holder.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby srinebula » 13 Nov 2016 22:47

Sir, one sincere request. Please start using your debit card, net banking etc., for few days. Those of us who can manage without touching cash should do this for next couple months, and reduce burden on currency circulation.

My Milk+water supplier agreed to take money through online transfer because of cash crunch. People are trying to cope in different ways. IMHO anyone who is on this forum or on twitter can manage without touching cash for few months. Let's all try and help in this difficult phase.

Amit Patel wrote:I for one fall into this category. I had a CC for a long time ... unused for 1 year and got cancelled.
Planning to reactivate the same and change my future financial management.

There is also an entire populace that is borderline crorepati and engaged in sme who manage their personal tax and finance in such a way that they end up officially paying zero to no tax, which I believe needs to change.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby srinebula » 13 Nov 2016 22:50

Deans wrote:
shiv wrote:Yes.


It wont work if there are actually 50 villagers depositing money. More likely the goon's `accountant' who deposits money into 50 accounts
he created, in connivance with the bank branch manager, using 50 aadhar cards.

It would be worthwhile for the Govt to announce a whistle-blowers scheme where a proxy depositor can retain the money deposited in his
account if he reveals the name of the BM holder.

+100 on rewarding whistle-blowers. Not just in this scheme, but lot of other schemes being invented for converting BM notes. People should be encouraged to report offenders.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby darshan » 13 Nov 2016 23:02

Many have stated here that apart from BM the other major components of this was to tackle fake currency, Islamic economy and terrorism. Yes, when you rip off a band aid there is some pain. Not all medicines I take are pleasant but I still do.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby abhijitm » 13 Nov 2016 23:05

IndraD wrote:Jaggi has written on Swaraj Mag
Before undertaking this
what stopped the government from promoting e-wallets and mobile money, the infrastructure for which was ready six months ago? Why does it require only commercial operators like PayTM or private banks to entice people into digital money? If millions of Africans can use mobile phones for their daily transactions, it beggars the imagination that we are so slow to push the idea#
any expert comment?

I have experience in mobile wallets start ups so I can comment by observation that the african model wil not work in India because africans are using digital wallets not because it is better but because the economic conditions force them to. Wallets provide them best to get around the problem of theft, high inflation, devalued currency. In India we are not "forced" to use them. Until carrying cash becomes untenable this will not happen. When people can carry cash it gives them assurance of transaction over an electronic transaction which has multiple points of failure. Idea is to gradually take out higher denomination cash so that people start adopting the digital transactions. Bank's MDR on small value transaction also needs to be negotiated to overcome cost per transaction issue.

It will happen eventually.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby tandav » 13 Nov 2016 23:07

Some advice needed needed

Some clients have defaulted/not paid on payments for good and services provided and have indicated that they would like to remit old 500 and 1000 to clear dues.

Q1 Can firms accept these old notes and deposit to company account after raising invoices etc.
Q2 What documentation do the goods and service provider need to take to deposit such cash remittances.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Marten » 13 Nov 2016 23:12

I was astounded by some of the comments. My milkman is paid via monthly fund transfer. The local grocer is paid through a debit card while most of our monthly purchases are via bigbasket+debit card. I pay for cabs via a wallet or the other. I've not had a credit card since 2004. We usually have only about 25k at home for contingencies. Other than this, I carry hardly a couple of thousands at any point. Not once would I be inconvenienced by this change. Current understanding is that the 100 notes are being cornered by folks attempting to stack their BM away. Eventually these will disappear since a lot of BM is chasing these notes. Which is why the new notes are coming in just in time.

PS: I don't think the 2000 notes will remain in the market for more than a year. I hope we are working on polymer notes.
PS: Tandav, RBI has not issued any advice for firms. If your regular turnover is not affected, the banks should not be bothered about how much you accept/deposit. Why do the customers refuse to pay via other means--is your business a regular cash+carry business?

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Re: Currency Demonetisation and Future course of Indian Economy

Postby vijayk » 13 Nov 2016 23:13

Good analysis


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Re: Currency Demonetisation and Future course of Indian Economy

Postby vijayk » 13 Nov 2016 23:16

tandav wrote:Some advice needed needed

Some clients have defaulted/not paid on payments for good and services provided and have indicated that they would like to remit old 500 and 1000 to clear dues.

Q1 Can firms accept these old notes and deposit to company account after raising invoices etc.
Q2 What documentation do the goods and service provider need to take to deposit such cash remittances.


Invoices and Receipts should be before Nov 8.

They are trying to convert black money. Depends on the car amount too.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Picklu » 13 Nov 2016 23:23

srinebula wrote:
Deans wrote:
It wont work if there are actually 50 villagers depositing money. More likely the goon's `accountant' who deposits money into 50 accounts
he created, in connivance with the bank branch manager, using 50 aadhar cards.

It would be worthwhile for the Govt to announce a whistle-blowers scheme where a proxy depositor can retain the money deposited in his
account if he reveals the name of the BM holder.

+100 on rewarding whistle-blowers. Not just in this scheme, but lot of other schemes being invented for converting BM notes. People should be encouraged to report offenders.


I would suggest not to allow the single whistle-blower to retain fund as he would become the sole target of thugs.

Instead, the gov should (may be as a special one time scheme this time) confiscate 50% from all such JDY accounts and let everyone of the poor fellows to retain the remaining 50%. That would give more BPL people a motive to stand up and resist pressure from goons. The goons also have to go after a lot of people to intimidate :)

This allows the govt to penalty 50% anyway and the other 50% goes from the BM holder to a bunch of poor needy folks who will thank NaMo for ages.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby hanumadu » 13 Nov 2016 23:38

tandav wrote:Some advice needed needed

Some clients have defaulted/not paid on payments for good and services provided and have indicated that they would like to remit old 500 and 1000 to clear dues.

Q1 Can firms accept these old notes and deposit to company account after raising invoices etc.
Q2 What documentation do the goods and service provider need to take to deposit such cash remittances.


All 500 and 1000 Re bills are void after Nov 8 midnight. I suggest you not to accept them if possible.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby saip » 13 Nov 2016 23:46

tandav wrote:Some advice needed needed

Some clients have defaulted/not paid on payments for good and services provided and have indicated that they would like to remit old 500 and 1000 to clear dues.

Q1 Can firms accept these old notes and deposit to company account after raising invoices etc.
Q2 What documentation do the goods and service provider need to take to deposit such cash remittances.


The question is can you accept notes which are NOT legal tender in discharge of debts after Nov 8th. If you do, are you not guilty of money laundering?
I believe the only places these notes can be tendered are the places notified - banks (hospitals, bus stands, railways, airlines etc for a few days). If your company does not fall into any of these AND within the time limit specified you would be guilty too. (That is my opinion and I am NOT a practicing attorney).

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Re: Currency Demonetisation and Future course of Indian Economy

Postby vijayk » 13 Nov 2016 23:56

Manak Gupta ‏@manakgupta 4h4 hours ago
Cash deposit - 75945 crore
Exchange - 3753 crore
Withdrawal - 7705 crore


(SBI figures till 5 PM)

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Re: Currency Demonetisation and Future course of Indian Economy

Postby hanumadu » 14 Nov 2016 00:00

vijayk wrote:
IndraD wrote:Jaggi has written on Swaraj Mag
Before undertaking this
what stopped the government from promoting e-wallets and mobile money, the infrastructure for which was ready six months ago? Why does it require only commercial operators like PayTM or private banks to entice people into digital money? If millions of Africans can use mobile phones for their daily transactions, it beggars the imagination that we are so slow to push the idea#
any expert comment?


Good observation.

I also think they should incentivize people to voluntary disclosure by reducing penalties.

We are corrupted in our thinking for generations. We don't want to pay even 5% and here we are trying to make the people join main economic stream by paying taxes of 45% during amnesty and 30/60/90% NOW.

You have to incentivize to acquire customers and reduce the tax burden. Same thing with taxes like registration tax etc.

What BJP and COngis don't understand is instead of 12.5% of taxes on 1000 crores of white transaction, if they collect only 4% of 4000 cr, they get the same money. Use incentive to bring people into system and keep all the money white.

Instead they impose huge burden and let people run away


He already did it. People did not heed? What else can he do?

Any rate below 45% is unfair to people to paid their taxes on time and at 30%. It will also create complacency and will encourage them to think there will be such future amnesty schemes. Its this fear and guarantee of losing everything that Modi wants to create to encourage future compliance. As already pointed by posters on this forum, Indian taxes are lower than many countries. Further lowering can only occur gradually after looking at the revenues.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby aakashrj » 14 Nov 2016 00:00

http://www.hindustantimes.com/india-new ... dG8bM.html

His countrymen may be fretting and fuming chasing scarce 100-rupee banknotes, but Manilal Prajapati, 45, is without a care in the world.
A cable operator in the village of Akodara, some 90kms from Ahmedabad, Prajapati on Friday bought wheat flour and a packet of potato chips for Rs 200 from the local grocer with just few clicks on his mobile phone. His phone is linked to his bank account and money was instantly transferred to the account of the grocer, Pankil Patel.

While tremors of the Centre’s demonetization move resulting in acute scarcity of cash are felt across the country, Akodara is an oasis of calm. It is India’s first ‘digital village’ where all families fall back on e-banking for everything – from buying milk to biscuits – through their mobile phones.
Prajapati, for that matter, collects his monthly cable connection rents in a similar fashion. All that his subscribers have to do is to send an SMS to the bank after typing 3 followed by Prajapati’s mobile number, the amount to be transferred and the last six digits of their own account numbers and the amount is credited in no time.

Sabar Dairy’s milk collection center at Akodara uses a special software to keep account of milk supplied by local farmers. Payment is done through e-banking on the every tenth day. (Siddharaj Solanki/HT Photo)

“We have got used to e-banking and hardly deal in cash and therefore the notes scarcity has not hit us,” says Patel, the grocer. For anything above Rs 10, his collections are through e-banking.
“Like the rest of Indians, we are not worried about depositing or exchanging cash. All the adults here have bank accounts linked to their Aadhar numbers. As all the transactions at markets, milk cooperatives, shops and even vegetable vendors here are cashless, we withdraw cash only when we have to go outside the village,” says J S Patel, a farmer.

Even the local dairy cooperative has stopped making cash payments since the past one year. It transfers money to the accounts of the farmers, saving the administration the trouble of handling huge volumes of cash.
The village with a population of 1,200 was adopted by the ICICI Bank as part of Prime Minister Narendra Modi’s Digital India campaign. It has transformed the village into one with few parallels.
“Unlike other bank branches in the rest of the country, there is no rush here. Its business as usual for us,” says bank manager Pratik Panchal.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby tandav » 14 Nov 2016 00:13

Marten wrote:snipped...
PS: Tandav, RBI has not issued any advice for firms. If your regular turnover is not affected, the banks should not be bothered about how much you accept/deposit. Why do the customers refuse to pay via other means--is your business a regular cash+carry business?


Well heck if I know... All we know is that the vendor has been following up for payments for 6 months now and after demonetization client has said that they have the cash and would consider paying in cash. The vendor has essentially given up receiving the monies (written it off and considering legal options) but this comes as an option now. Vendor however has never dealt with cash. It is always NEFT/RTGS/Checks in their line of business. But the outstandings are very large nearly Rs 80 lacs+

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Shaktimaan » 14 Nov 2016 00:23



Arun Jaitley on Aap Ki Adalat today.

He made good points but overall I feel he was dismissive of the concerns of the common people who are standing in line for hours. He could have made the same points with some more sensitivity.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Sicanta » 14 Nov 2016 00:26

Thing with BSBD accounts under jan dhan yojana is that one can not withdraw more than 10000 in a month. It will have to be huge undertaking on part of bm holders to get back their money.
Last edited by Sicanta on 14 Nov 2016 00:29, edited 1 time in total.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby tandav » 14 Nov 2016 00:26

saip wrote:
tandav wrote:Some advice needed needed

Some clients have defaulted/not paid on payments for good and services provided and have indicated that they would like to remit old 500 and 1000 to clear dues.

Q1 Can firms accept these old notes and deposit to company account after raising invoices etc.
Q2 What documentation do the goods and service provider need to take to deposit such cash remittances.


The question is can you accept notes which are NOT legal tender in discharge of debts after Nov 8th. If you do, are you not guilty of money laundering?
I believe the only places these notes can be tendered are the places notified - banks (hospitals, bus stands, railways, airlines etc for a few days). If your company does not fall into any of these AND within the time limit specified you would be guilty too. (That is my opinion and I am NOT a practicing attorney).


Exactly my thought and advice to the vendor that only notified institutions can now accept cash. However demonetization appears to be a once in a lifetime opportunity to recover all the writeoffs and provide a springboard for growth for many SMEs in the same situation.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Suraj » 14 Nov 2016 00:34

abhischekcc wrote:
Suraj wrote:abhischekcc, some questions for you:
a) did you support Modi's plan to take on black money ?
b) did you understand what taking on the black economy entails ?
c) if you did understand, did you make contingency plans to move to all white transactions ?


a) Only to the extent it destroys FICN and old black money. But the introduction of 2000, 1000, and 500 notes means that corruption will resurface in future. There is no long term plan for fighting corruption, as Modi thinks Congress/others are beaten and only BJP will rule from now on. Hence, BJP can do corruption without restraint.

Hold it right there. We are talking of black money. Not corruption, not business difficulty etc. Not the same things. Let's not conflate them. Black money HAS been destroyed. In fact that's literally what happened - as of midnight Nov 9 2016, every last Rs.500/1000 note of black money is worth Rs.0. As someone (pankajs ?) said, all they are now, is a chit that you have to take to the bank to actually get money. Further, there is no plan to print the same amount of new notes. Not even 10% of the current notes out there.
abhischekcc wrote:b) Sure, it means going after each and every suspect, analysing their expenditure and seeing if it is above known sources of income, and then filing cases against them. This involves going after crores of Indians. I also understand that Modi has tried to sidestep fighting corruption with this hair brained and improperly planned stunt, which he obviously thinks is a 'cunning' plan. His assumption is (assuming he is sincere) - denude people with BM and corruption will end. Haha, corruption will only end if the avenues of corruption are removed.

Again, stop. Black money is not a synonym for corruption. If you claim that, every kirana store person is corrupt . Is that your claim ? No. Now put that aside.

I ask you this very straightforward question: if they participants in a black economy have the currency they hold being invalidated, what do you think happens to the black economy ? It dies. Anything asset whose value held up by transactions in black money, falls in price.

Before you lose track of the thought process and say 'they'll just buy gold / land / etc', let me restate - not a single Rs.500/1000 old note has any face value anymore. It's a chit. They can't buy things with it. They can unload a little bit to someone more gullible, but not their entire hoard. Every single 'chit' is now something no one wants to deal with, because they either have to go to the bank, or give it to someone who will go to the bank.

You can't divide it in small portions and deposit it anonymously. The total cash float in Rs.500/1000 was approx $250 billion, or Rs.1,65,00,00,00,00,000, i.e. we're talking in crore-crores (whatever that unit is) . A large part of that was 'black money' . The more you divide it, the more effort it takes, and the more time you lose. It can't be swapped with Rs.50/100s . It's mathematically impossible because 86% of the cash float was in Rs.500/1000 and 14% was in Rs.100 or less. Can't. be. done.

abhischekcc wrote:c) All my transactions are white :lol:

Maybe, but your original complaint was the fall in price of your property. You may have purchased it in 100% white money, and plan to sell in 100% white money. But the RE market has a lot of black money. Any gains in the house price since purchase was backed significantly by demand caused by black money.

Now that money is worth Rs.0 . What do you think happens to the value of assets you hold ? This is why I asked you (b) above - did you understand what taking on black money entails ? You don't have to literally deal with black money, but if you hold assets whose market is dominated by black money, it will fall in price. On the other hand, all the cash you hold rises in value . Did you understand that when you supported Modi in this effort, anytime before Nov 8 2016 ?

I ask this question repeatedly, because an understanding of 'action against black money' means that if you support a politician whom you want to act on black money and thing action is imminent, the most logical course of action is to go into cash and unload as many things that you can, whose market is held up by black money. This is no different from selling bonds when you think interest rates will rise.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Suraj » 14 Nov 2016 00:40

tandav wrote:Some advice needed needed

Some clients have defaulted/not paid on payments for good and services provided and have indicated that they would like to remit old 500 and 1000 to clear dues.

Q1 Can firms accept these old notes and deposit to company account after raising invoices etc.
Q2 What documentation do the goods and service provider need to take to deposit such cash remittances.

Please don't. Insist on a check or other banking means, or delay payment from them until after they have new cash. As others have stated, There are no 'old Rs.500 / Rs.1000' anymore . They have Rs.0 face value. Now is a good time to consider accepting largely or only in non-cash ways. The short term pain can't be denied but you'll be doing something worthwhile for your own long term benefit.

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Re: Currency Demonitisation and Future course of Indian Economy

Postby Sanju » 14 Nov 2016 00:41

Primus wrote:
Sanju wrote:My FIL sold his property in August asking for all white and selling it at the Govt. rate. When the buyer said I don't have the money all in white, He said give it to me when you have it. He could have of-course sold it partly in black and made more money. But then after serving the Army for 30 years as a Doc in AMC he is still supporting his country and doing the right thing.

I hear what the businessmen here are saying. I empathize with you that yes it is a hard step for you. I can only say that you need to have some faith in Modi, who I am sure has gamed it and the sky will come falling down on the corrupt officials. You are all way better off than the Chinese people who lost their livelihood and their property. No consolation but perspective.....for the larger good of the country people will have to go through hardship.


Sanju Ji, my sentiments exactly. We have been waiting for five years for my father's house to be be bought by someone willing to pay white, he was a scientist with DRDO, very much a patriot. Now one can hope this will indeed happen.


Primus ji,
I hope that it happens and soon. All it needs is one person starting the trend and everyone else following. Good night will actually be a good night as one can sleep in peace w/o worrying about hassles from IT or anyone else.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby ManuJ » 14 Nov 2016 00:48

Small businessmen who claim to be 'all white' should note that there's no limit on depositing old denomination notes in banks. Even if they deposit 1 crore of notes, as long as they can show that it's all white, they should have no concern.
So where is the liquidity crunch, beyond the very short-term lack of availability of new notes?

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Suraj » 14 Nov 2016 00:49

Karthik S wrote:We know that banks received deposits worth $30B. Any idea on the amount of money discarded ? That will be the amount by which RBI's liability goes down.

That will be known after Dec 30 . Whatever didn't get deposited by then is toilet paper, and deemed destroyed.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby JayS » 14 Nov 2016 00:55

https://twitter.com/3iedRaven/status/797862797480558592

If you want to report some BM related incidence you can report it at -

http://www.ceib.nic.in/reward.htm

Anonymous option also available.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Suraj » 14 Nov 2016 00:57

abhischekcc wrote:
JohnTitor wrote:You realise you contradict yourself, right?

Cashless has to start somewhere. In any case, purchase of high value items such as vehicles, gold (above a certain amount), property all need to be forced to go cashless. This is how it works in the developed economies. No one will pay $1m in cash to buy a house - even if you have it in cash, you will generally be asked to deposit it and create an electronic transfer otherwise It will raise too many red flags.


I think you are misinterpreting my words.

In my post, small transactions means shopping related - grocery, petrol, white goods, etc. Large transaction means RE or business related.

Certainly, autos need all WM to purchase for middle class, but not so for second hand autos.

And when I said gold will be used in high value transactions, I meant as a medium of exchange. Not as the end purchase product.

You are still asserting circular logic. Realize that all the large fishes are sitting on piles of old notes that have 0 face value . To buy gold, they have to find enough jewelers willing to accept that worthless paper *and* fudge their books and deal with IT later. If they buy land , they have to find realtors who will do the same. This is basically one big fish passing the buck to another. Someone finally still needs to deposit that cash in the bank, and to unlock its value, they have to prove that it's white. All that's happening in this process is big fishes transferring the problem between each other, i.e. there's no net solution to their problem.

This is the central failure of every claim that 'big fishes will move elsewhere'. Black money notes have 0 value now. They *can't* move elsewhere. Maybe a fraction of money can be exchanged with some other unscrupulous or gullible person. But there's too much of such cash out there and not enough gullible people.

Even the success in depositing money in the bank guarantees nothing. They can't take it out, except in small amounts. When GoI later investigates and looks at anomalies, these accounts will be suspended, and the money probably confiscated. When that happens, they don't just sit on piles of paper worth Rs.0 . They'll sit on nothing.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Manish_Sharma » 14 Nov 2016 01:15

Another plus point of Demonetisation :

Image

Suraj
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Re: Currency Demonetisation and Future course of Indian Economy

Postby Suraj » 14 Nov 2016 01:44

Translation please. I got the gist of it, but don't understand a couple of words. Dihari ?

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Re: Currency Demonetisation and Future course of Indian Economy

Postby sanjayc » 14 Nov 2016 01:46

Dihari - daily wages

In Kashmir, after Fridah prayers, no stone were thrown on the army and no slogans were shouted
With discontinuation of Rs 500-1000 notes, daily wages of stone pelters ended too, and so did their Jihad
Last edited by sanjayc on 14 Nov 2016 01:48, edited 1 time in total.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby jamwal » 14 Nov 2016 01:47

No sfone pelting and sloganeering in kashmir after friday brayers.
500 and 1000 notes gone, daily wages finiahed, jihadi finished.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Suraj » 14 Nov 2016 01:54

Sicanta wrote:Thing with BSBD accounts under jan dhan yojana is that one can not withdraw more than 10000 in a month. It will have to be huge undertaking on part of bm holders to get back their money.

They can't take it all out. Nowhere near the same amount of cash is being printed again. Anecdotal claims of a handful of people getting part of their cash back in new notes means nothing. It just means the rest of the big fishes get nothing out, since the fewer bank notes out makes it a zero sum case for the rest.

Once the money is deposited back in the banking system, GoI has all that deposit base back. Anything that gets destroyed means nothing, because even the 'deposited money' is physically destroyed. Destruction instead of deposit means RBI can simply mark off 'this much cash no longer in circulation, so we can increase our own balance sheet by that much, for free'.


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