Currency Demonetisation and Future course of Indian Economy

Suraj · Post by **Suraj** » 13 Dec 2016 04:42

Akshay Kapoor wrote:Something just struck me. Even if mulayam can put lots of cash in the bank (and can take it out too ) he will end up showing thousands of people how much money he has. Surely some will ask in their minds - where did he get that. And more importantly that might lead to - some of it is stolen from my family and me. They may not be able to do anything about it now but surely he will loose some votes ? I think people are missing this point. I would certainly think like this - why should my vote help him to live a more Alishan life ?

You are bringing logic into this discussion unnecessarily. We ares required to believe that all the poor folks are fools who will willingly help the big shots keep their money and will even serve as loyal servants to help them out with it.

SaiK · Post by **SaiK** » 13 Dec 2016 04:47

Akshay Kapoor wrote:
Akshay Kapoor wrote:

Dammit. I've got a huge amount of equities in demat account with them. Moved demat from HDFC as sevive was terrible. And equites broker company that we use have account with them. But what fraud can they do with demat. The companies share register will also have records so it should be fine. Don't worry Karan. Should be okay. You are the owner of the money in the MF and even if they go bankrupt that money should be ring fenced and segregated. I'm reasonably sure. Suraj any comments ?

In my experience (perhaps as an economic fool) I have burnt up to $huge losses for keeping it idle or forgetting about it. I always think, one should keep playing with your money and keep moving it around. You would never know. Keep your risk profile for not more than 4/5 years depending on the type of investment

realized this so late in life, and I am a budda with no money now. your choice... complete freedom. risk are yours

Rudradev · Post by **Rudradev** » 13 Dec 2016 04:55

I have money locked up in Aditya Birla Real Estate Fund. Probably flat lining (if not taking a deep dive) right about now. Fortunately it was a "nice-to-have" investment, that won't destroy me financially if it doesn't pan out.

I hope DeMo works out, though, for the best possible overall result after all this. Many like myself are going to lose out, at least in the short-to-medium term, even though we haven't owned or spent a paisa of black in our lives.

SaiK · Post by **SaiK** » 13 Dec 2016 07:16

DeMo if not followed by "LESS CASH" system, it is all just a short-term gains on the 50% tax/fine collected on these voluntary deposits.

Most importantly, the real real-estate will boom only in a cashless system. Bloody hell! the black marketer especially goondas will now show less interests in RE because, they have to pay taxes.

disha · Post by **disha** » 13 Dec 2016 08:06

Akshay Kapoor wrote:Something just struck me. Even if mulayam can put lots of cash in the bank (and can take it out too ) he will end up showing thousands of people how much money he has. Surely some will ask in their minds - where did he get that. And more importantly that might lead to - some of it is stolen from my family and me. They may not be able to do anything about it now but surely he will loose some votes ? I think people are missing this point. I would certainly think like this - why should my vote help him to live a more Alishan life ?

That is what the educated but illiterate folks understand, see and that is why NaMo's Demo has immense support. They see at as somebody trying to hit at the oppressors. They see that the fight is hard and there might not be even a chance of winning it., but it is the fight they want for once and not the result. Since failing will not be any worse then what they already are in.

I have pointed it out in other forums that the common person sees NaMo as fighting on their behalf and they will not let go of a person fighting on their behalf even if the person is losing a fight. It is the intention that counts. Efforts towards that intention that counts. Mistakes will be forgiven.

It is the chatterati and the lootyens and the elites like us who have suddenly woken up and asked - hey look at the poor who are standing in line at the bank! Heck, I used to stand in line for the ration (oil/sugar) for hours together and remember the frustration that on reaching the doors of the shop., one look at me and the shop owner says - we are out of oil/sugar! I stood in bank lines and in train lines and lines at the court.

So for me standing in a bank line where the unfair price shop owner (ration shop owner) gets a fair deal by NaMo even for a day makes my year.

disha · Post by **disha** » 13 Dec 2016 08:08

SaiK wrote:DeMo if not followed by "LESS CASH" system, it is all just a short-term gains on the 50% tax/fine collected on these voluntary deposits.

Most importantly, the real real-estate will boom only in a cashless system. Bloody hell! the black marketer especially goondas will now show less interests in RE because, they have to pay taxes.

DeMo followed by GST will plug the leakages. Only leakages will be in Edu Institutes, Hospitals and RE. And Opposition has sensed it and hence they are not allowing GST to go through.

Subdas · Post by **Subdas** » 13 Dec 2016 08:24

Amm ami clearly sees DEMO as a bold step in fight against corruption and terrorism. So they will continue to back it even if they have to stand in bank queues. Slowly they will also realize that this will also help to keep their hard earned money in safe place instead of chit funds etc. So all focus no should be to rollout mobile notes to am admi who may not have access to debit cards.

NRao · Post by **NRao** » 13 Dec 2016 09:14

SaiK wrote:DeMo if not followed by "LESS CASH" system, it is all just a short-term gains on the 50% tax/fine collected on these voluntary deposits.

Most importantly, the real real-estate will boom only in a cashless system. Bloody hell! the black marketer especially goondas will now show less interests in RE because, they have to pay taxes.

Talk of withdrawing the Rs. 2000 Bill within 7 years. The time it normally takes to fake.

Marten · Post by **Marten** » 13 Dec 2016 09:20

I have been trying spend talking with a cross-section to get a feel of the reactions in BLR. Don't want to sound like the Chindu or rudali(N)DTV, but getting only 2k notes in the ATM will sap the patience of the general public. Got a 15 minute pravachan from 4 security guards this morning on how much demo will help and how they support it despite their suffering due to lack of change below 100. They asked me to explain the concept of inflation - which was easier thanks to the tutorials on this forum. They seem to understand their money will be more valuable while those that have been avoiding taxes and PF are in fact stealing from them! All of this is anecdotal but I spend time gathering these tidbits to understand the currents in at least my general area. I still feel there will be repercussions for NaMo unless he gets visibly large targets within the month AND manages to get RBI to push in lots more change in 10, 20 and 50 notes. Don't see why we cannot order this lot from any other country.

NaMo will have to keep pushing the message across. Given that the Gandhi-Mainos are going to be in legal trouble very soon, expect all of media to rise against society with a vengeance. Imagine a bunch of marxists in Chennai getting this much airtime when there are many more serious issues on hand such as the aftermatch of the cyclone. Chennai though is better prepared than last year!

Deans · Post by **Deans** » 13 Dec 2016 09:32

Karan M wrote:wooops so does the forum think the axis guys are toast? just parked a large sum in their tax saving mutual fund for the tax break under 80c. better to withdraw or remain as is?

The people best placed to weed out fake accounts are the bank audit teams themselves. My feeling is that Axis will be anxious to cooperate
with the authorities as their reputation has already taken a hit. I don't believe regular bank customers need to worry.

Yagnasri · Post by **Yagnasri** » 13 Dec 2016 09:42

http://economictimes.indiatimes.com/mar ... n=COLUMBIA

and RBI has to step in.

https://twitter.com/RBI/status/808280830833397761

This is the problems with New Gen Private Banks. Lack of full level commitment to things like KYC due to pressures of business development. Further as per on info huge amount of gold came into India ( some 250 tonnes) from 9th to 12th November through imports and smuggling.

Yagnasri · Post by **Yagnasri** » 13 Dec 2016 09:53

http://blogs.timesofindia.indiatimes.co ... -benefits/

Sorry if already posted.

Singha · Post by **Singha** » 13 Dec 2016 10:00

interview with axis bank ceo shikha sharma in ET today. some 50 employees are suspended and bank is co-operating to investigate. KPMG has been retained to run forensics on these dealings.

she agreed there are some bad apples in the barrel.

chetak · Post by **chetak** » 13 Dec 2016 10:07

Deans wrote:
Karan M wrote:wooops so does the forum think the axis guys are toast? just parked a large sum in their tax saving mutual fund for the tax break under 80c. better to withdraw or remain as is?
The people best placed to weed out fake accounts are the bank audit teams themselves. My feeling is that Axis will be anxious to cooperate
with the authorities as their reputation has already taken a hit. I don't believe regular bank customers need to worry.

rather like hiring the fox to audit the hen coop, right??

Austin · Post by **Austin** » 13 Dec 2016 10:35

Karan M wrote:wooops so does the forum think the axis guys are toast? just parked a large sum in their tax saving mutual fund for the tax break under 80c. better to withdraw or remain as is?

You cant withdraw 80C savings as it has 3 years lock in period.

MF business of Axis is different from its Banking Business , Axis is not the only entity who is laundering black money for Netas and Business people many Pvt and PSU banks are doing this as every bank manager has to achieve a certain target for their branch and for maintaining good long term customer relation and meet its target they are forced to do it.

That is how things works in real world

wig · Post by **wig** » 13 Dec 2016 10:53

http://www.tribuneindia.com/news/haryan ... 35965.html

Pandits paid in scrapped notes

More than 2,000 pandits, who chanted mantras in Sanskrit for nine days during the Lakschandi Yajna organised by the BJP district unit, were taken aback when they were handed over Rs 3,500 each in scrapped currency during the culmination ceremony here today.
The pandits, who were invited from different parts of the state and outside to perform the ‘auspicious’ yajna, were given ‘dakshina’ in the form of three notes of Rs 1,000 and a Rs 500 note each.
The BJP district unit had termed the event historic. Governor Kaptan Singh Solanki had inaugurated it on December 4 and several Cabinet Ministers, including Ram Bilas Sharma and OP Dhankar, had marked their presence at the event.
One of the pandits said they could not believe their eye when the organising committee members gave them old currency notes.
“It seems to be an attempt to get rid of black money by organising a mahayajna,” they alleged. Sources said about Rs 70 lakh in banned currency was distributed among pandits and others on the occasion.
Pandits lamented, “We have to go back to our homes. How can we use this money that is no longer a legal tender?” Organising committee members refused to comment on the issue.

Akshay Kapoor · Post by **Akshay Kapoor** » 13 Dec 2016 10:56

disha wrote:
SaiK wrote:DeMo if not followed by "LESS CASH" system, it is all just a short-term gains on the 50% tax/fine collected on these voluntary deposits.

Most importantly, the real real-estate will boom only in a cashless system. Bloody hell! the black marketer especially goondas will now show less interests in RE because, they have to pay taxes.
DeMo followed by GST will plug the leakages. Only leakages will be in Edu Institutes, Hospitals and RE. And Opposition has sensed it and hence they are not allowing GST to go through.

Namo should use int agencies and threats of sending Vadra to jail to win GST. He is playing too nicely. Am tempted to offer my services. Have seen how people can crack under interrogation. Can't use that with these esteemed leaders but can certainly get tons of dirt on them and pick them off one by one. This is a no bar no prisoner taken war now.

Akshay Kapoor · Post by **Akshay Kapoor** » 13 Dec 2016 10:58

wig wrote:http://www.tribuneindia.com/news/haryan ... 35965.html

Pandits paid in scrapped notes
More than 2,000 pandits, who chanted mantras in Sanskrit for nine days during the Lakschandi Yajna organised by the BJP district unit, were taken aback when they were handed over Rs 3,500 each in scrapped currency during the culmination ceremony here today.
The pandits, who were invited from different parts of the state and outside to perform the ‘auspicious’ yajna, were given ‘dakshina’ in the form of three notes of Rs 1,000 and a Rs 500 note each.
The BJP district unit had termed the event historic. Governor Kaptan Singh Solanki had inaugurated it on December 4 and several Cabinet Ministers, including Ram Bilas Sharma and OP Dhankar, had marked their presence at the event.
One of the pandits said they could not believe their eye when the organising committee members gave them old currency notes.
“It seems to be an attempt to get rid of black money by organising a mahayajna,” they alleged. Sources said about Rs 70 lakh in banned currency was distributed among pandits and others on the occasion.
Pandits lamented, “We have to go back to our homes. How can we use this money that is no longer a legal tender?” Organising committee members refused to comment on the issue.

Hahahaha. Have to give it to these politicos. Total haramis. Can't imagine a more ironical thing.

RajeshG · Post by **RajeshG** » 13 Dec 2016 11:14

Suraj wrote:
Akshay Kapoor wrote:Something just struck me. Even if mulayam can put lots of cash in the bank (and can take it out too ) he will end up showing thousands of people how much money he has. Surely some will ask in their minds - where did he get that. And more importantly that might lead to - some of it is stolen from my family and me. They may not be able to do anything about it now but surely he will loose some votes ? I think people are missing this point. I would certainly think like this - why should my vote help him to live a more Alishan life ?
You are bringing logic into this discussion unnecessarily. We ares required to believe that all the poor folks are fools who will willingly help the big shots keep their money and will even serve as loyal servants to help them out with it.

Kapoor saab and Suraj

How do you think the money mule system worked ?

But again Chandragupta's main point was different. As i understood it, his point was that the big shots can have n number of ways to solve their problems ( with one simple scalable eg ). Please refer to Dr Soumya Ghosh's ( CEA SBI ) EconWatch report from March 2016. Even back in March he suspected that demo has started. But again we dont know how - atleast i never will, the scale of the issue is unfathomable to simple minds like mine who dont even know how many zeroes come in those amounts.

What we do know however is that aam-aadmi wants retribution. People just love the feeling that neighbors have all this wads of cash ( that they dont ) which they will have to shred/burn. People want sarkaar to employ huge forces to knock on neighbor's door and drag them to the street ( or whatever strikes their fancy ). Ironically when TV visuals are shown of that tandon fellow's wads that were actually caught, people get even more p1ssed and want an even bigger spectacle.

And if the big guys have fixed their stuff and if sarkaar has to knock on aam-aadmi doors then that would not be good.

sankum · Post by **sankum** » 13 Dec 2016 11:18

Situation will ease by Dec end as Rs12000-15000 Cr being printed daily.

New notes worth Rs 5 lakh crore in, less than one-third demonetised

RajeshG · Post by **RajeshG** » 13 Dec 2016 11:22

Manish_Sharma wrote:
RajeshG wrote:
He has to just for show. From the way Narendra (?) Aggarwal speaks in the house they arent really 'opposed'....
Its Naresh Aggarwal.

You are joking right?

He was so upset and seething that he even pointed towards BJP benches and said "...these sarkari dalals..." , he also cited his personal family thing to urge the govt. in taking this back, citing how his own wife has been keeping money from him without telling and has only now told him...

https://www.youtube.com/watch?v=PeBB2_0XFaw

Please watch this video and tell me whether you think he looks upset.

Sachin · Post by **Sachin** » 13 Dec 2016 11:24

Looks like it is fun times in Kerala. The earlier report was that NABARD was happy with the KYC adherence of the District & State Co.Op banks of Kerala. And it was armed with this report, that these worthies have filed a case in Supreme Court. Now Malayala Manorama has the below report (in Malayalam).
In search of the owners of 1000 crore rupees (Malayalam)
Will try to get an English report of the same as well, but till then my rough translation of the report....
NABARD has launched an investigation to find out the true owners of 1000 crore (Rupees) which was deposited to District Co.Op banks through the Primary Co.Op banks. How ever the District Co.Op banks who allowed the primary co.op banks to deposit their entire money, is unable to provide the details of the account holders, as that data would only be available with the primary co.op banks.

There was a plan to allow people to have a "mirror" account of the primary co.op bank account in a district co.op bank. How ever the primary co.op banks did NOT provide the KYC details of these account holders to the district co.op bank, fearing that the account holder would switch his account to the district co.op bank. This has now led to a situation that NABARD can inform the central government that district co.op banks do have around 1000 crore worth of rupees, for which true account holders cannot be identified. Such a report would have a negative impact on the case which the Co.Op banks are fighting at the Supreme court.

Supreme Court is planning to hear the case tomorrow (14th Dec), and the Co.Op bank staff complain that NABARD officials are doing the investigations even when the state had a long week end, so that the report reaches the Central Govt. before the case hearing . Selected District Co.Op banks in Kannur, Wayanad, Thrissur, Ernakulam & Thiruvananthapuram were under scrutiny over the last few days. Thiruvananthapuram & Malappuram had the officials visiting the banks on Sunday. Today the team would visit banks at Kollam, Aalapuzha, Kozhikode & Kasargod districts.

The plan is to collate all reports from various parts of the state, and submit the final report by end of the day today. The District Co.Op banks have KYC details of their direct account holders, but only the details of the Primary Co.Op bank when it comes to the money deposited by them. There are rumours that a few new-generation banks have taken the entire amount deposited by the Primary Co.Op banks. Such a bank in Chennai is said to have taken in Rs.300 crore worth of deposit from a primary co.op bank in Malappuram.

Yagnasri · Post by **Yagnasri** » 13 Dec 2016 12:16

http://swarajyamag.com/economy/how-much ... oming-back

As per the above report:

"Based on RBI’s balance sheet for the financial year ending 31 March 2016, the value of specified bank notes withdrawn was initially estimated to be around Rs 14.63 lakh crore. On Tuesday (29 November), in a reply to a question in the Rajya Sabha, Minister of State for Finance Arjun Ram Meghwal said that there were 17,165 million pieces of Rs 500 notes and 6,858 million pieces of Rs 1,000 notes in circulation on the day Modi made his historic announcement. The total amount of high denomination currency circulating in the system on 8 November was, thus, Rs 15.44 lakh crore (Rs 8.58 lakh crore in Rs 500 notes and Rs 6.86 lakh crore in Rs 1,000). This means that close to Rs 4 lakh crore is yet to come back."

“in the Rs 11.5 lakh crore number there is a lot of double counting. We think that the total deposits garnered so far are lower than that number.”

So we may yet get some good amount of money not coming into the system.

Chandragupta · Post by **Chandragupta** » 13 Dec 2016 12:43

Suraj wrote:
Akshay Kapoor wrote:Something just struck me. Even if mulayam can put lots of cash in the bank (and can take it out too ) he will end up showing thousands of people how much money he has. Surely some will ask in their minds - where did he get that. And more importantly that might lead to - some of it is stolen from my family and me. They may not be able to do anything about it now but surely he will loose some votes ? I think people are missing this point. I would certainly think like this - why should my vote help him to live a more Alishan life ?
You are bringing logic into this discussion unnecessarily. We ares required to believe that all the poor folks are fools who will willingly help the big shots keep their money and will even serve as loyal servants to help them out with it.

Yes, please believe it. For a cut, everybody wants a piece of the gravy train in India. That's been our story since 1947. Why do you think people like Pawar, Yadav, Lalu, Amma, Muka, Didi win elections after elections? Do mango people don't know how corrupt they are?

srinebula · Post by **srinebula** » 13 Dec 2016 12:56

Chandragupta wrote:
Suraj wrote: You are bringing logic into this discussion unnecessarily. We ares required to believe that all the poor folks are fools who will willingly help the big shots keep their money and will even serve as loyal servants to help them out with it.
Yes, please believe it. For a cut, everybody wants a piece of the gravy train in India. That's been our story since 1947. Why do you think people like Pawar, Yadav, Lalu, Amma, Muka, Didi win elections after elections? Do mango people don't know how corrupt they are?

This is absolutely correct. This factor can be seen very transparently in rural local body elections; only a few thousand voters are there in panchayats and they know the candidates personally. If most of the voters are honest, the most honest candidate should win in these elections. But nope, that very rarely happens.

jamwal · Post by **jamwal** » 13 Dec 2016 13:08

http://www.thehindu.com/opinion/op-ed/N ... epage=true
Not a tragedy, but the remedy

Narendra Modi is correcting the monumental mismanagement of the economy by the economist Dr. Manmohan Singh

In his article (“Making of a mammoth tragedy”, The Hindu, December 9), Dr. Manmohan Singh attacked the demonetisation of high denomination notes (HDNs) by the National Democratic Alliance (NDA) government as the “making of a mammoth tragedy”. In his prose, Dr. Singh speaks less as an economist in which capacity he is respected more than as the former Prime Minister, the role which has actually dented his image. Yet it is best to respond to him on economic issues which he has kept away from, not to his political verses. Undisputed facts, not alluring rhetoric, should decide whether demonetisation is a tragedy or a remedy. Is it a monumental mismanagement of the economy as Dr. Singh charges? Or is it a remedy for the accumulated filth as Prime Minister Narendra Modi claims? To know the answer, the story of the Indian economy from 1999 to 2004 under the NDA and from 2004 to 2014 under the United Progressive Alliance (UPA) needs to be recalled.

ALSO READ

Real versus statistic

During the NDA rule (1999-2004), real GDP grew by 27.8 per cent, annually 5.5 percentage points. Annual money supply, that fuels inflation, by 15.3 per cent. Prices by 23 per cent, annually 4.6 per cent. Asset prices rose only moderately in those five years. Stocks rose by 32 per cent; gold by 38 per cent. Taking Chennai as an illustration, land prices by 32 per cent. Jobs rose phenomenally, by almost 60 million. The NDA also turned in a surplus of $20 billion in 2002-04 in the external sector, after decades of unending deficits, save in two years in the late 1970s.

Now come to the UPA rule under Dr. Singh, the economist Prime Minister. In the first and best six years of the UPA (2004-05 to 2009-10), before it was hit by scams, real GDP grew by 50.8 per cent, annually 8.4 percentage points — one-and-a-half times NDA’s. The world celebrated Dr. Singh. The UPA was intoxicated by the “high growth” story. But how many jobs did UPA’s high growth produce? Believe it or not, just 27 lakhs against 600 lakhs during NDA’s five years, according to NSSO data. UPA achieved one-and-a-half times NDA’s GDP growth, but just 5 per cent of its job growth. Dr. Singh now bemoans that Mr. Modi’s demonetisation will stifle jobs!

Move on. In the six years, prices rose by 6.5 per cent (4.6 per cent under NDA). The external sector deficit was $100 billion (against NDA’s $20 billion surplus). Did high petroleum prices force it? No. Zero-rated customs duty-led capital goods imports which topped petroleum imports was the culprit.

Asset inflation

Why was the UPA’s high growth jobless? The well-kept secret is that huge asset price inflation, not production, passed off as high growth. In the first six years of the UPA, stock and gold prices jumped by three times — annually by 60 per cent. Property prices doubled every two-three years. In Gurgaon, not on the property map in 1999, land prices rose by 10-20 times. Asset inflation in six years was three times the annual nominal GDP growth. The asset inflation not the result but the cause of the UPA’s “high growth”! How? Modern economics deducts the non-asset price inflation from nominal growth to know the real growth. But it sees asset price rise as wealth and prosperity and adds it to GDP. See how this economics worked for the UPA.

Unmonitored Rs.500/1,000 notes

Economics says money, growth, prices and jobs are inter-related. Apply this rule to the NDA and UPA periods. During 2004-10, average money supply grew annually 18 per cent (15.3 per cent under the NDA). But asset prices rose by several multiples of it. The moderate rise in money supply over the NDA’s number does not explain the huge asset inflation. The clue hides in the rising unmonitored HDN cash stock with the public which made black money deals easy. In 1999, the cash with the public was 9.4 per cent of nominal GDP. By 2007-08, instead of falling due to rising bank and digital payments, it jumped to 13 per cent of nominal GDP. Later it began hovering around 12 per cent. More critically, the HDNs with the public more than doubled from 34 per cent in 2004 to 79 per cent in 2010. On November 8, 2016, it was 87 per cent. The average annual rise in HDNs was 51 per cent between 2004 and 2010 and the annual rise was 63 per cent by 2013-14. The Reserve Bank of India noted that two-thirds of the Rs.1,000 notes and one-third of the Rs.500 notes — that is over Rs. 6 lakh crore now — never returned to banks after they were issued. The unmonitored HDNs roaming outside banks began driving up the gold and land prices by black cash and the stock prices through Participatory Notes (PNs) — which are largely hawala transfers out of India — that came back pretending as foreign investment in stocks. The PNs rose from Rs.68,000 crore in 2004 to Rs.3.81 lakh crore in 2007.

How did the asset inflation lead to the UPA’s “high growth”? Inflated asset prices to the extent realised by sale got accounted as part of income and included in GDP. Large part of the gains on stock sale got added to GDP with very little tax under Securities Transaction Tax. The spurious wealth effect also led to high-end consumption. The annual private consumption growth averaged 18 per cent till six years to 2009-10 — 80 per cent over the NDA average. The fake wealth effect, powered by HDN cash, scripted the UPA’s “high growth” story. HDNs outside banks took refuge in stocks, gold and land, produced capital gains-led growth and consumption. Had the HDNs circulated through the banking system, it would have multiplied through the fractional reserve model, reduced the inflation and interest, and funded the small-and-medium enterprises starved of organised funding.

Catch-22 situation

The curse — asset inflation inspired jobless growth — seems irreversible till unmonitored HDNs roam and fuel fake growth. Dr. Singh had had enough wake-up calls when the share of HDN cash was escalating year after year from 2004. He could have de-escalated the hugely growing cash economy had he remonetised the HDNs by lesser denominations without demonetisation — sparing the people of discomfort and economy of short-term damage. Of course, he would have lost the “high growth” brand that made UPA rule an economic success. To unmask this deception and revive job productive growth, the unmonitored HDNs needed to be brought to account forcibly. By his inaction, undeniably, Dr. Singh had landed the economy in a Catch-22 situation. The Modi government could either opt to continue the status quo of jobless growth or force temporary decline in growth to reinstate real growth and jobs. It opted for the latter. Even an undergraduate student in economics will tell you that it will cause hardship and hit growth in the short run. A Cambridge economist is not needed to write a column on that. It is already late. If the status quo of unmonitored HDNs were to last for another five-six years, the size of HDNs would have become so huge that no government may have been able to act against it — inevitably inviting a huge crisis, both internal and external. Prime Minister Modi has rightly called the demonetisation as “kadak chai” (bitter pill). That HDNs promoted high bribery and helped terror funding through fake HDNs cannot be disputed at all. Far from doing a monumental misappropriation or making a “mammoth tragedy”, Mr. Modi is correcting the monumental mismanagement of the economy by the economist Dr. Singh.

Rishi Verma · Post by **Rishi Verma** » 13 Dec 2016 13:18

K. Michael of Bangaluru, an RBI official, arrested by CBI in money laundering. In other continuing raids, Jaipur and Assam can be included in the list.

Gov should streamline these arrests and investigations. If the CBI and courts take 10+ years to conclude the cases then will the seized notes (new Rs2000 bills) be kept as court exhibits? We need those notes in circulation.

So the gov should initiate something like a plea bargain and make smaller fish pay a hefty penalty, give bigger names, and let them go.

Jmt

Sicanta · Post by **Sicanta** » 13 Dec 2016 13:21

srinebula wrote:
Chandragupta wrote:
Yes, please believe it. For a cut, everybody wants a piece of the gravy train in India. That's been our story since 1947. Why do you think people like Pawar, Yadav, Lalu, Amma, Muka, Didi win elections after elections? Do mango people don't know how corrupt they are?
This is absolutely correct. This factor can be seen very transparently in rural local body elections; only a few thousand voters are there in panchayats and they know the candidates personally. If most of the voters are honest, the most honest candidate should win in these elections. But nope, that very rarely happens.

And we are taking a very simplistic view of the problem. Voting in all those politicians was a practical decision in order to ensure theur own survival. I remember reading one of brihaspati ji's post expounding the reality then. Plus education level low so demands by voters low. Our democracy is maturing now. Awhile back complete majority for a single party in UP was nearly unthinkable. Now voters do so to ensure that the present day gov has full freedom to implement its promises. And they are taken to task for their failures. Is caste among other factors still playing a role? Yes but its influence is on wane. If the same were not true, modi would not have been voted in with his message of 'sabka vikas', and the support from the people not existing today despite all the hardships they have had to face in conducting day to day activities. Dalits in UP voted for him which resulted in BSP getting 0 seats, 543 mentions that those in punjab are gravitating towards bjp. People want a better future for themselves and the nation. And they are sure modi will protect them to the best of his ability.

Things have changed since 2014.

chetak · Post by **chetak** » 13 Dec 2016 13:26

^^^^^^^
@jamwal

http://www.thehindu.com/opinion/op-ed/N ... epage=true

Unbelievable that this article has been published in the chindu too.

Quite the bitter dose for all scammers to swallow.

chetak · Post by **chetak** » 13 Dec 2016 13:32

Karan M · Post by **Karan M** » 13 Dec 2016 13:40

Akshay Kapoor wrote:
SaiK wrote:Karan ji, move it out to HDFC

Dammit. I've got a huge amount of equities in demat account with them. Moved demat from HDFC as sevive was terrible. And equites broker company that we use have account with them. But what fraud can they do with demat. The companies share register will also have records so it should be fine. Don't worry Karan. Should be okay.

Akshay saar if equities then ok, after all they are just a broker i guess. i have invested in their MF. perhaps bank and AMC will be treated separately.

i have some good amount parked in their ELSS funds. this one in particular
http://m.moneycontrol.com/mutual-funds/ ... lan/MAA011

now taking it out and moving to another is pain because most of these chaps ask for physical visits and their online fund deposit always has some con. eg FT India, you get a message saying that if you want cashless deposit to your account, visit a branch. Axis was the easiest setup TBH. SBI is hilarious. their online access is, print this form and submit to branch.

hmmm...wondering if there is some substance to these axis rumors.

Shaktimaan · Post by **Shaktimaan** » 13 Dec 2016 13:49

A senior central bank official was arrested in Bengaluru today by the Central Bureau of Investigation, for his alleged involvement in illegally exchanging as much as Rs 1.50 crore, ANI reported.
The official, K Michael, is a senior special assistant in the Reserve Bank of India.
Further details are awaited.

The first RBI official caught for illegal money exchange. I hope there are no more such individuals.

Singha · Post by **Singha** » 13 Dec 2016 14:01

http://m.indiatoday.in/story/bengaluru- ... 33217.html

One more from blr....sbi sbm kotak and karnataka bank officers nabbed

Singha · Post by **Singha** » 13 Dec 2016 14:04

Top to bottom from rbi to branch is compromised

We need to deploy and nsg srg spetzgruppa nationwide with maximum ruthlessness to send a message out loud and clear. Its one thing to be served warrant by a local cop with compromised senior ranks....one thing to have black masked stone faced nsg team kick bedroom door in and haul them out nanga to unmarked vans

Suraj · Post by **Suraj** » 13 Dec 2016 14:10

RajeshG wrote:
Suraj wrote: You are bringing logic into this discussion unnecessarily. We ares required to believe that all the poor folks are fools who will willingly help the big shots keep their money and will even serve as loyal servants to help them out with it.
Kapoor saab and Suraj

How do you think the money mule system worked ?

These people are not mules to begin with. It also entirely discounts what disha said - that people are not interested in being mules.

Chandragupta wrote:Yes, please believe it. For a cut, everybody wants a piece of the gravy train in India. That's been our story since 1947. Why do you think people like Pawar, Yadav, Lalu, Amma, Muka, Didi win elections after elections? Do mango people don't know how corrupt they are?

No sorry. 'Believe it' does not work except when Bhagwan asks for it. Everyone else has to present evidence.

The situation you state and the present are diametrically opposite power dynamics. In the past , the politicians controlled the power. They had the money - real functional money - and the ability to deploy muscle with that money to get their way. People are glad to take some crumbs coming their way then. The people had only one source of power here, and that was to elect the other guy, who had exactly the same sort of power over them too. All the people do in such a situation is alternately elect one or the other to keep them all on their toes, aka 'anti-incumbency'.

With DeMo, politicians don't have money. They have huge bundles of nice printed paper that says '500' or '1000' on it. Just like the 500 and 1000 on Monopoly game notes, and EXACTLY the same value as those game notes, i.e. zero. They have to convince their goons to accept that printed paper and do their bidding, paper that those goons cannot even buy a dozen bananas with. And they have to convince the mango men to also accept the nice printed paper. And they have to make all those people go to bank, get real money out in exchange, and hand it back to them.

And we're supposed to believe that people are collectively too dumb to realize who has the power - them or the politician, in this situation. Modi doesn't care about any of them accumulating some of that ill gotten cash from Mulayam. Even the Kashmiri rageboys and Maoists took just a day to realize that the game is up. All these 'mules' supposedly don't understand they're being handed toilet paper and told to give back real money, and keep a little of that real money. When they could just keep it all.

If you saw above, I posted PMJDY account deposit data. Deposit aggregate has not fallen. It has kept rising week upon week. Unless there is net outflow, there is no proof of the PMJDY mechanism being used. This is what I mean by data. There is no data to support this thesis as plausible to any further extent than converting some chickenfeed amount, definitely not some big fish level amounts...

Yagnasri · Post by **Yagnasri** » 13 Dec 2016 14:16

@ For those who are worried about the MF investments - Normally the entities relating to MFs will be subsidiaries. There will be separate staff and other things will be there. Further, the MFs are tightly regulated activity and suppose to ensure proper activities. So no need to panic, be vigilant.

Suraj · Post by **Suraj** » 13 Dec 2016 14:16

Singha wrote:Top to bottom from rbi to branch is compromised

We need to deploy and nsg srg spetzgruppa nationwide with maximum ruthlessness to send a message out loud and clear. Its one thing to be served warrant by a local cop with compromised senior ranks....one thing to have black masked stone faced nsg team kick bedroom door in and haul them out nanga to unmarked vans

As this whole drama plays out, it reminds me of SoKo during the early days of Park Chung Hee. He went through a protracted period of the same thing - taking on the previous corrupt kleptocracy that had embedded itself in economic and public life. Followed by which he was able to initiate dramatic reforms that transformed a basketcase (they were way poorer than us in the 1950s) into what the place is today.

Most of the action will not get MSM publicity, because the MSM is part of that same cabal. It's important to track through other sources.

Karan M · Post by **Karan M** » 13 Dec 2016 14:22

Austin wrote:
Karan M wrote:wooops so does the forum think the axis guys are toast? just parked a large sum in their tax saving mutual fund for the tax break under 80c. better to withdraw or remain as is?
You cant withdraw 80C savings as it has 3 years lock in period.

MF business of Axis is different from its Banking Business , Axis is not the only entity who is laundering black money for Netas and Business people many Pvt and PSU banks are doing this as every bank manager has to achieve a certain target for their branch and for maintaining good long term customer relation and meet its target they are forced to do it.

That is how things works in real world

i think the big state banks are at least straightforward. ythey follow rules. so much so they will make you run around for basic stuff. pvt ones, i dont know.

regarding 80c if its before the cutoff, logic dictates i should be able to switch funds. its a pain but it is what it is. or am i missing something.

Marten · Post by **Marten** » 13 Dec 2016 14:33

Austin wrote:
Karan M wrote:wooops so does the forum think the axis guys are toast? just parked a large sum in their tax saving mutual fund for the tax break under 80c. better to withdraw or remain as is?
You cant withdraw 80C savings as it has 3 years lock in period.

MF business of Axis is different from its Banking Business , Axis is not the only entity who is laundering black money for Netas and Business people many Pvt and PSU banks are doing this as every bank manager has to achieve a certain target for their branch and for maintaining good long term customer relation and meet its target they are forced to do it.

That is how things works in real world

OT: Austin, could you contribute to the Savings and Investments thread and suggest the right investments in specific areas? Am sure there are many other capable experts here who will contribute.

Suraj · Post by **Suraj** » 13 Dec 2016 14:37

Marten wrote:I have been trying spend talking with a cross-section to get a feel of the reactions in BLR. Don't want to sound like the Chindu or rudali(N)DTV, but getting only 2k notes in the ATM will sap the patience of the general public. Got a 15 minute pravachan from 4 security guards this morning on how much demo will help and how they support it despite their suffering due to lack of change below 100. They asked me to explain the concept of inflation - which was easier thanks to the tutorials on this forum. They seem to understand their money will be more valuable while those that have been avoiding taxes and PF are in fact stealing from them! All of this is anecdotal but I spend time gathering these tidbits to understand the currents in at least my general area. I still feel there will be repercussions for NaMo unless he gets visibly large targets within the month AND manages to get RBI to push in lots more change in 10, 20 and 50 notes. Don't see why we cannot order this lot from any other country.

NaMo will have to keep pushing the message across. Given that the Gandhi-Mainos are going to be in legal trouble very soon, expect all of media to rise against society with a vengeance. Imagine a bunch of marxists in Chennai getting this much airtime when there are many more serious issues on hand such as the aftermatch of the cyclone. Chennai though is better prepared than last year!

Great work Marten . I'm going to add your suggestions to my next write to PM message, to follow up on the previous feedback I've sent them.