Bharat Rakshak

RBI Conducts Tests with Bitcoin

It's obvious that NaMo is looking for ways to leapfrog India out of the current mess of "4-P"s poverty, population, pollution, and Pakistan. We should support this guy Modi with deeds and suggestions in areas where one has experience or expertise.

MUMBAI: In a boost to use of blockchain technology in banking, the RBI's research arm has completed the first ever end-to-end test of the technology behind Bitcoin in a project involving regulators, banks, financial institutions and clearing houses. The RBI's arm, Institute for Development and Research in Banking Technology (IDRBT), conducted the project using the technology behind Bitcoin in a trade application with banks and the National Payments Corporation of India (NPCI) participating too.

Yep, I saw that article, how Modi messed up and pulled down the Indian economy, which was finally beginning to overtake China in growth rate. But the article did have the grace to admit that next year and the year after, growth would rebound.

And yep, the chickens are coming home to roost. Only, they'll soon go out in search of feed again, and everything will be hunky dory.

What do these people think is going on between India and China anyway? Some kind of H&D intensive race? India is doing what she believes to be in her long-term interest. If the Chinese get a giggle out of that for one more year, they're welcome to giggle.

Dipanker wrote:IMF cuts India's growth rate to 6.6% due to note ban

Was'nt this pegged at 7.6% last week?? And is this about IMF cutting (i.e forcibly reducing) the growth rate, or their own calculations indicating that the growth rate would be 6.6%? If it is the second case (i.e it is just an estimate), then it could also change later?

chetak wrote:their intellectual cadres and icons have lost relevance as ordinary folks have increasingly rejected their dominance and are now very strongly asserting themselves across the board

The commies (and their "intellectual" coterie) is still holding out in their bastions like Kerala. In Kerala, the state Fin.Min even took a vacation and wrote a book explaining the demerits of DeMo. The book's launch was done by another "intellectual" (a writer) M.T Vasudevan Nair. He also became a finance expert all of a sudden and "strongly criticised" GoI and this move. The Sanghies how ever gave it back in kind to him, and even today there is a slug fest going on. M.T's own hidden private life got exposed . Secondly in social media the narrative that if commies can criticise some one, they also can get criticised by others is gaining good momentum.

kiranA wrote:

shiv wrote: Well I can see a wholesale economic collapse of people who had a huge black stash and a business that ran on that. I see virtually zero collapse over most of the system

While there are some who accuse the government of dire errors, I think those people also forget the number of people who were lily white or nearly white and living on very little cash

So the news for the views that you express may be bad. the economy for most people is not about to collapse.

Shiv,

To understand what I am saying you need to possess two things.
1) An actual knowledge about how economy works stash of black money
2) A modicum of empathy condensending attitude when you see people suffering for no fault of them being honest and tax abiding .

There; corrected for you!

Neshant wrote:Its a slippery slope once the power to control peoples' earnings & savings is entirely in the hands of a few. (i.e. govt, banksters, corporations)
Its important to understand the issue and consequences of demonetization prior to endorsing your support for it.
This dude focuses a little too much on just Bitcoin (as no doubt he's a holder of the currency).
But the real discussion should be about decentralized money of which crypto-currencies are a part of.

___

Andreas Antonopoulos - The Death of Money - PART 1/2

No Govt will relinquish power, they will always try to bring more aspects of the society under their control. Economy and monetary policy is something fundamental and there will be no way they will lossen their grip on it. Watch the EURO scene, EU countries relinquished most of their powers and are now trying to get out of it now.

sudarshan wrote:.......................

What do these people think is going on between India and China anyway? Some kind of H&D intensive race? India is doing what she believes to be in her long-term interest. If the Chinese get a giggle out of that for one more year, they're welcome to giggle.

Pinkos invariably become ideologues for the philosophy they believe in and will always compare India with their ideal nation state, so the glee expressed at any perceived disadvantage to the home country is quite the norm.

shiv wrote:

kiranA wrote:
Shiv,

To understand what I am saying you need to possess two things.
1) An actual knowledge about how economy works
2) A modicum of empathy when you see people suffering for no fault of them.

Lets say I'm stupid and I don't know or notice how others suffer. But I am pretty clear about how I and others close to me have suffered. For no fault of my own. And now I look around and I see the possibility that the mofos who cause my suffering taking a beating. And I am enjoying it very much. I never thought I would see this in my lifetime and it gives me hope that those people can be kicked and beaten into extinction. No one gave a flying fuk when people like me spent every minute being honest and law abiding I only heard derisive laughs about being too stupid to understand how money works or how the economy works. And guess what - you are throwing the same crap at me.

So no. Those who are suffering are welcome to feel sorry for themselves - I will show them as much "empathy" as I and my ilk have received for our "economic ignorance"

Your patronization is no skin off my nose.

Exactly. For decades, those who didn't use black money were seen as gullible fools who didn't 'know how the economy works'. Well kiranA, how do you like em apples ? I have no empathy for your suffering. It's good to see you suffer because your BM stash caused you to burn your fingers. You STILL think you understand the economy better now ? As long as you evaded taxes you were absolutely at fault. Don't go around demanding empathy for your loss. There's none on offer, just satisfaction at seeing you pay your share by giving you no other option but to pay or lose it all.

There is the black economy (flow) and there are black assets (stock). Currency is useful as a medium of exchange when converting from one asset to another via flow or whether converting flow to stock, black or otherwise. The size of the black economy and total black assets were to the best of my knowledge multiple times that of black currency in circulation. Illegal foreign exchange dealers who could not do any business for the last couple of months are now back to regular programming. Conclusion: In the absence of other structural changes things will revert back to what they were. At least that's my best guess at this stage.

Everyone who's claiming 'it's back to regular programming now' leaves me very skeptical. It's not as if there's no structural change. Large transactions have to be reported. There's now a paper trail associated with everyone who made a deposit during DeMo. Lack of immediate IT summons is not proof that they 'got away' - a common argument made earlier. Take forex dealings. That is the most cash liquidity intensive BM activity, because it's the literal conversion between rupee / forex. It requires a large cash hoard to work with, that transacting in land etc does not. There's simply not a large enough cash base now, to claim that it's back to normal. If the standard cash economy is functioning normally, it means the amount of additional cash base backing the BM economy is dramatically lower.

Suraj wrote: There's simply not a large enough cash base now, to claim that it's back to normal. If the standard cash economy is functioning normally, it means the amount of additional cash base backing the BM economy is dramatically lower.

Spot on. If people think that the wheels are slowly churning again then they are going to be in for a big shock down the line. Demon was just one of the ways to remind the people to mend their ways, there would be many more in stow. The government has just done a factory reset on cash flows in the country. It will be extremely difficult from here on to get back into the same fraud scheme of things. As NaMo said even if 1 lakh people are needed to stop this he would and also unearth if things try to go under ground
cheers

Just a post from my understanding

30 million tax payers out of 1.2 billion
nearly 170+ million PANCARDS.

PM JanDhan account-- over 266 million+ bank accounts--about 24% zero accounts.

average account in bank under the scheme is rs 64000

(data from internet, wiki and PM JDY website)

From the above, I believe the tax sleuths can track the accounts thru pancards, aadhar pm jan dhan yojana etc various persons entities - how the money moves.
I believe the first task is people with high money movements across.
This will take upto 1 year of more as this will be easily be few milions.(but a drop in 1.2 billion population).

tax implications by default in most countries is upto 7 years . So tax men have enough time to nail fraudsters.


------------------------------
Due to demonetisation-- likley huge increase in tax payers who cannot escape out of the tax net. almost 2 times the existing tax base.
More awareness amongts all classes of people-- dont know how it helps. But having some knowledge is useful I suppose.
continuing plugging of loop holes thru various other schemems like gst, stopping re routing of black money thru tax havens, taking account of benami land holders, gold etc and agreements with other countries etc etc if taken to logical end by creating a system
NaMo would have ensured that for years to come , govt would not have to worry too much about income thru tax.

But key is going thru the above implementation in the coming years.
Elections have to be won in 2019 to ensure it is not tampered by congress/sickulars.

only time will tell how the plans pan out in the long run.

Huge bold gamble but already a success in my limited view.

----------------------------------

Aside --about NMS filing system-- I recd a email about it -few easy questions.
many others have also recd it.
good begining to catch the tax escapees.

Dipanker wrote:Demo Chickens coming home to roost?

IMF cuts India's growth rate to 6.6% due to note ban

What really matters is employment, i.e. new jobs created. The GDP number can be gamed heavily (it does matter, but only if the growth is real & jobful). Of course as a result of demo, jobs may probably be lost this quarter. The question is how industry, especially small and medium enterprises recover after the fallout.

yensoy wrote: Of course as a result of demo, jobs may probably be lost this quarter. The question is how industry, especially small and medium enterprises recover after the fallout.

Perhaps we should then list down some business which was heavily relying on black money. Real Estate sector for sure is one. And at least in Kerala, there were reports of lots of "Bengalis" going back as there was no work for them. They were all predominantly working in construction jobs, and in some areas also into wood works. Another area which saw a negative outlook was "vehicle sales", but here again we do not know if low sales volume would take out the jobs.

Why is a blip in growth a surprise or even news to anyone ? Or even something that supposedly is a critique of demonetization ? It's absolutely guaranteed that demonetization would cause dramatic economic restructuring. If anything 1-1.5% blip in GDP is is a sign of tremendous resilience. Remember that the early estimates were far more pessimistic, like the legendary one claiming GDP growth would fall to 0% ?

To those who post such statements as a critique, how about making a stand ? Do you deem demonetization as something that should not have been done ? Why ? On what basis do you defend the existence of the black economy ? And in fact, do you have a better proposal to make ?

the question is, did demo really finish off or atleast significantly damage black economy?

demo would prove to be useless if things are back to how they were in 6-12months time

Of course it didn't finish it off. There are BRF members who resolutely defend black money and black economy, and their desire to keep doing things as they did before. How on earth is black money going to be gone if people stubbornly consider it their right to conduct theft ?

Dipanker wrote:Demo Chickens coming home to roost?

IMF cuts India's growth rate to 6.6% due to note ban

Looks like chickens have decided to skip their home coming for some time
UN puts India’s GDP growth at 7.7% for 2016-17

Now whom to believe IMF or UN? And the next question is what is the credibility of all these reports? Are these the benchmarks or they are just indicative reports?

Unfortunately it is back to regular programming.
Rent a crowd political rallies and street sloganeering is back.

What has happened is very simple. Explained it steps.

1. GoI announces demonetisation
2. Common people praise it and slug it out in long queues
3. Crooks finds ways to circumvent
4. Banks help is money laundering
5. Situation worsen as banks siphon off cash to launder money for crooks and criminals
6. Daily withdrawal limit revised as GoI sense discomfort and murmurs of complain
7. As months wear off all cash seems to have made its way into banks, except a small amount of supposedly BM left outside
8. Common people wise up and start realising that they have been taken for a ride and made to suffer the fool
9. GoI panics and raises withdrawal limit to 10K per day.

GoI has thrown in the towel.

10k per day withdrawal is too high an amount, almost at pre No 8 levels. All cash is finding way back into BM economy.

I have stated, very first few days of this event and very first few pages of this thread. I will repeat this again.

1. Cashless / electronic transactions must have been made mandatory for all govt. agencies state and central. Long ago.
2. On demonetisation announcement, banks must been instructed to entertain only their branch customer for exchanges.
3. On demonetisation announcement, banks must been instructed to entertain only their branch customer for deposits and ATM withdrawals.
4. Non banked currency holders must have been instructed to surrender the same at RBI office, Post Offices etc. with suitable identifications and trace ability mechanisms.

Anyway, its time to move. It was last chance to undertake any serious any anti-corruption measure. Notwithstanding intentions, it was poorly implemented.

If this is the mental calibre of our leadership and best in the bureaucracy, then it is time to emigrate perhaps.

Dipanker wrote:Demo Chickens coming home to roost?

IMF cuts India's growth rate to 6.6% due to note ban

Dipankar,

You would have done yourself, and us, a favour if you had cared to post this chart too. This was with the story.



The chart says it all. That is the real effect of the demonetization - a temporary blip with a lot of benefits. Two of the most striking ones are the partial recapitalisation of banks without government bailout and a money trail for all the money that came back to the banking system. Even the black money that came in and became white will remain so from now on subject to taxes and a money trail. This is a point that is not much appreciated.

More needs to be done, that's for sure but to say DeMo has been a failure by quoting selective stats is something that Papu does for a living. One would expect better from BRF IMHO.

But yes, down with Modi for DeMo. China is going to grow 0.1 per cent faster than India in 2016! How disastrous - 1962 redux all over again!

NB: A small data point for you. For 2015-16, the really smart guys at IMF forecast a 7.3 per cent GDP growth for India. The actual growth was 7.6 per cent.

This certainly does NOT gel well
Parliamentary Committee criticises RBI governor for inability to answer questions on Demonetisation

The RBI Governor was unable to tell us how much money has come back to the banks: Saugata Roy(TMC), member of standing committee on finance
pic.twitter.com/Vil5d29rOD — ANI (@ANI_news) January 18, 2017......

I am expecting some major fire works on this now.

SRoy sir, this demonetization exercise has been taken to eliminate FICN. So it is a success.

Black Money, is not in the form of Cash. It is in the form of quid pro quo's, into Agriculture, to a lesser extent into Real Estate, then in the foreign Land. At any point of time, the BM is not even 2-3% in cash.

If your aim is to curb the black money, you need to ask the government to
1. Digitize the government departments
2. Start taxing Agricultural income
3.Stall all Real Estate development for a fixed period of time
4. Stall the youngsters to emigrate to Western countries, and put the rule that only people above the age of 40 years only to travel to foreign countries. STOP education loans to students.

TKiran wrote:SRoy sir, this demonetization exercise has been taken to eliminate FICN. So it is a success.

Black Money, is not in the form of Cash. It is in the form of quid pro quo's, into Agriculture, to a lesser extent into Real Estate, then in the foreign Land. At any point of time, the BM is not even 2-3% in cash.

........

4. Stall the youngsters to emigrate to Western countries, and put the rule that only people above the age of 40 years only to travel to foreign countries. STOP education loans to students.

I am a bit confused. Could you please explain?

Most of the corrupt baboons send their wards abroad by taking loans and the loan disappears subsequent financial year. It would be impossible to track down such transactions. Then all the black money would be routed through hawala. This has been the latest trend, not unlike in 90's only a handful of iitians used get Admission in to good US university with fee waiver and assistantships, and landing at the Land of honey and milk with 20 dollahs in pocket

^^

It has always amazed me how so many people I know are able to send their kids to study in very expensive universities in the US where average costs are at least $75K per year (tuition plus dorm plus living expenses) which is way more than what the parents are 'officially' making at home. Many of these are business families where understandably the income is very hard to calculate from the outside, but quite a few are the children of salaried government or private employees.

TKiran wrote:Most of the corrupt baboons send their wards abroad by taking loans and the loan disappears subsequent financial year. It would be impossible to track down such transactions. Then all the black money would be routed through hawala. This has been the latest trend, not unlike in 90's only a handful of iitians used get Admission in to good US university with fee waiver and assistantships, and landing at the Land of honey and milk with 20 dollahs in pocket

That is perhaps the old ways. Not familiar with any of these things, but what would be the situation in an electronic world? Do you expect the funds to "disappear"?

@SRoy,

Two problems with your post. First as has been pointed out by many money deposited in banks does not make it white. The IT-ED agencies are going to look into it hopefully with a magnifying glass. This process is going to take long as the population is big. It does not mean demo has been a failure "yet".
The other mistake in your post is that you want govt to coerce people to go cashless. In a democracy it will backfire. It has to be done with incentives and disincentives. As for people going back to cash other steps are necessary to ensure e.g. that the neighborhood kirana uses a POS machine for sales. Demo is not going to do that. they have to think of other things. Cashless or more appropriately less-cash economy is a long term goal that the govt wants to move towards not a one time magic.

Sachin wrote:

Dipanker wrote:Demo Chickens coming home to roost?

IMF cuts India's growth rate to 6.6% due to note ban

Looks like chickens have decided to skip their home coming for some time
UN puts India’s GDP growth at 7.7% for 2016-17

Now whom to believe IMF or UN? And the next question is what is the credibility of all these reports? Are these the benchmarks or they are just indicative reports?

If you read the article you posted you will get the impression that UN study was done before demonetization and the forecast for the calendar year 2017 then was indeed 7.7%.

However, it turns out that even before the demonetization the economy was slowing down a bit and the forecast was revised to ~7.1% by one of the govt. organization (can't recall which one) based on the economy data upto October 2016. Then demonetization happened and net effect of demonetization have been estimated anywhere between 0.5% to 3% slowdown.

If we go by the lower estimate of 0.5 then the IMF figure of 6.6% ( 7.1 - 0.5 ), seems about right. If we go by the higher estimates, things could actually end up worse.

These are estimates and most often conservative. We will get the real picture in another 6 months.

@Supratik,

What people at large initially suspected and later became well known (scan newspapers reports) is that banks diverted cash for their preferred customers. This contributed to discomfort in the initial days. Agreed IT-ED are working. But unless we results, lets not bet on anything.

About the cashless bit. I don't want govt. to coerce people, rather govt. departments must be made to accept cashless payments. You got it other way around.

@SRoy,

Yes, lets wait to see the next steps before we conclude demo has been a failure. As for aam janta thing have returned to almost normal.

Re: govt depts. It is already happening e.g. there was a post on railways in SCC that payments are now almost 99% digital and reserved booking 75% digital.

I am more worried about the fact that majority of the 12 million shop owners may be cheating on their income. Apart from people like doctors, lawyers, traders, etc. How to make them go white is the biggest challenge.

SRoy wrote:What people at large initially suspected and later became well known (scan newspapers reports) is that banks diverted cash for their preferred customers.

What newspaper reports and 'diverting cash to preferred customers' ? Everyone came under the same set of rules, with no scope for discretion.

Kiran Kumar S ‏@KiranKS 45m45 minutes ago
Indian banks issued Rs. 9,20,000,00,00,000 new currency to customers, in just 10 weeks. The quantity and speed, never seen in human history!

http://economictimes.indiatimes.com/new ... 652611.cms

Manmohan Singh asks finance committee members to show restraint with Urjit Patel

According to an MP, Singh, a former governor of RBI and finance minister, said a firm ‘no’ when some Congress members of the panel, particularly Digvijaya Singh, asked Patel whether he feared a “run on the banks” if RBI lifts the ceiling on withdrawal of cash from ATMs and banks.

“No, you don’t have to answer that question,” Singh is learnt to have told the RBI governor as soon as the sensitive question was put to the RBI governor.

....

Singh also played a significant role in making the meeting less stormy for the RBI chief. Perhaps aware of the surcharged political fight over note recall and the reports about the planned ‘grilling’ of Patel at the committee, Singh told members ahead of the RBI governor’s and his three deputies appearance, to ensure “the prestige of the institution is respected” during committee interactions.

Primus wrote:It has always amazed me how so many people I know are able to send their kids to study in very expensive universities in the US where average costs are at least $75K per year (tuition plus dorm plus living expenses) which is way more than what the parents are 'officially' making at home. Many of these are business families where understandably the income is very hard to calculate from the outside, but quite a few are the children of salaried government or private employees.

Lots of people are leveraging the boom (whether it is justified or not is anybody's guess) in real estate. If the real estate goes south, the wards are already well settled in the US and will payback the loans. At least that is the "white" explanation.

Supratik wrote:@SRoy,

Yes, lets wait to see the next steps before we conclude demo has been a failure. As for aam janta thing have returned to almost normal.

Re: govt depts. It is already happening e.g. there was a post on railways in SCC that payments are now almost 99% digital and reserved booking 75% digital.

I am more worried about the fact that majority of the 12 million shop owners may be cheating on their income. Apart from people like doctors, lawyers, traders, etc. How to make them go white is the biggest challenge.

No problem, if it is suspected that any is cheating and has black money a very simple thing to be done - remove the new 500 and 2000 rupee notes as a legal tender. That will teach these people a lesson!

I suspect that the parliament committee's grilling of RBI's Patel is to pre-empt another round of demo. Many Neta's seem to have survived the losses but don't want the new notes to be withdrawn.

I will make no difference to the government if it plans to have another round of demonitasition. It will simply go ahead. No amount of grandstanding by the opposition will help.

From twitter

Banks have to report to IT deposits of 10 lakh per year and cash payment of 1 lakh on credit card bill. The squeeze is on.

http://economictimes.indiatimes.com/new ... s?from=mdr

Notes ban: IT writes to RBI; says co-operative banks’ cash records seriously tampered with
The Income Tax Department has written to the RBI informing it about alleged illegal malpractices being deployed by a number of cooperative banks after its probe found “serious” difference in accounts, to the tune of multi-crore rupees, in the aftermath of the notes ban.

http://www.livemint.com/Money/EopbIW2tq ... ising.html

"In December, steel consumption rose by 5.2% over a year ago and by 17.1% over November, according to data collated by the government’s Joint Plant Committee (JPC)."

Since these numbers are counter-intuitive from the demonetization POV, the analysts believe that this has simply gone into inventory.