This is in continuation of post No. 828 (part 5/10). Click to go to 828. I am collecting quotes relating to this demonetization both from net, and from common people in streets. The real problem of 2016 November is; Rs. 500 is not a high denomination currency. It is held by common people everywhere, as ATMs dispense mostly Rs. 500 notes only, and few Rs. 100 notes as a remnant filler. Example: If Rs. 10,000 is drawn, customer will get Rs. 500x19, and Rs. 100x5, total Rs.10,000/-. Thus, Rs. 100s have been relegated to margins, and Rs. 500s are on the main track. Though Rs. 500 may be a stalking denomination, it is also a common-man's note, for day's expenditure.
"...Every petrol pump will accept notes of Rs 1000 & Rs 500 till 11 Nov, I appeal all to kindly coordinate: Union Minister Dharmendra Pradhan. ..."
Today I went to a photocopy and DTP Centre. They have A4 size stickers on walls that Rs. 500 and Rs. 1000 notes will not be accepted. There I found four employees working. The employees there get salaries of around Rs. 5,000 per month. That is less than Rs. 200 per day. Two Puri-s in tea stalls cost Rs. 28/-. The Employer photocopy-DTP owner came forward to give them Rs. 500/- to buy puris. But the Rs. 500/- note cannot buy them Puri-s. But they can buy petrol!
"... For economy to be robust, it should be cashless. -- Arun Jaitley, Finance Minister."
ybrao-a-donkey's humble view: True, the Economy will become cashless. Rich people will exchange gold, diamonds, silver, art-paintings, antiques, for their transactions of receipts and payments. That was the custom around 300 years back.
Poor people will go back to barter system. They will give a bagful of cotton, and get some rice equal to it in exchange. Salt can become money. Conch Shells can become money. Rudraksha fruits can become money. There is no compulsion for poor people to use banks. Though there will be some initial difficulties in a cashless and bank-less society people have the ingenuity to work out solutions.
"...Thank you. All of us have to work shoulder to shoulder and create a prosperous, inclusive and corruption free India.--- Mr. Narendra Modi in a Twitter Message.
No. Comment. Commenting will be dangerous.
"...Pakistan prints Indian currency more than they print their own. This currency ban by PM Modi will curb terror funding. Only a visionary leader like PM Modi could have done this, this will directly impact terrorism as they work on hawala money. ..Nirmal Singh, J&K deputy chief minister ".
Counterfeit notes from Pakistan is a great menace. Demonetization can to some extent remedy it. But, lot of home work should have been done, to make demonetization SWIFT. It should not become a roller-coaster ride.
Publicise cost of demonetization: Left tells Modi Calling the government decision to demonetize higher denomination notes as a "gimmick", the CPM on Wednesday demanded the cost of withdrawing currency notes to be made public. "This demonetization is attempted as a gimmick to divert attention from serious social and political failures of this government in the past 2.5 years," CPI-M General Secretary Sitaram Yechury tweeted. "What is the cost of withdrawing currency notes and replacing them with Rs 2,000 notes? Also, its economic and social costs must be made public," he said, dubbing the move to be another "jumla"."What are the estimates of black money that will be curbed by this move? Government should make the figures public," said the leader of the Communist Party of India-Marxist.
yb-donkey: CPM does not seem to be acting on right track. Criticism should not be for criticism sake. There is nothing wrong with demonetization per se, even cost-benefit-wise. The problem is with lack of planning. Demonetization both for overcoming black-money and counterfeit-currency notes, needs lot of advance preparation. Banks must have sufficient staff, machines to handle contingencies. Proper procedures,forms for submission are to be designed. Haphazard execution will cause great difficulties to poor and aged persons holding Rs. 500 notes, while rich tycoons scape through unhurt, using loopholes, and surrogates. Example 1: Poor old women may hide their small accumulated lifetime savings in 1 or 10 Rs. 500 notes in the roof of their thatched homes. They will get sudden shock of their lives when they come to know, that they are worthless pieces of papers. Example 2: A rich person can send hired persons giving them Rs. 4,000 each to Bank counters, if Rs. 4,000 is ceiling for on-the-counter conversion.
The dividing line between a "jumla (election stunt or gimmick)", and a genuine action is very thin. What appears as genuine action may become a jumla, and what appears to be a jumla may be a genuine act. Hence, it becomes necessary for us to support Mr. Narendra Modi for both of his surgical strikes on Parkistan Borders, and the Demonetization. The problem is with the timing and methodology.
Bollywood lauds PM Modi’s decision to scrap Rs 500 and Rs 1000 notes.
yb-donkey: Bollywood might have long back siphoned off their black monies to tax havens.
"... The withdrawal of 500 and 1,000 rupee notes from circulation will not help in fighting black money as it is stashed away in foreign banks, foreign currency, gold or in the form of other assets, a top leader of the All India Bank Employees Association said. "Everyone knows that black money is mostly in foreign currency, in foreign banks, in gold or in properties and less in cash. Hence, this steps alone is not going to help in unearthing black money, ... AIBEA's general secretary CH Venkatachalam. ..."
yb-donkey: I totally agree. Indian Foreign Exchange Receipt-Payments System, Export-Imports System is like a cilli kunda. First those cillis/bokkas (holes) are to be plugged. Even in my dream-fantasy of True-Complete Socialism, where there is NO MONEY AT ALL WHERE EVERYTHING IS GOING TO BE FREE, -- preventing STATE MONEY GOING OUT SURREPTITIOUSLY TO HAVENS LIKE SINGAPORE, HONGKONG, HAVENS RUN BY UK GOVERNMENT, HAVENS RUN BY AMERICAN GOVERNMENT, -- is going to be real EXTREMELY SERIOUS problem. It is one of the reasons for the collapse of U.S.S.R. (name for Russia upto 1991). It is happening in China which flaunts itself as a Communist Country, though it was/is never.
"... It is perhaps most significant move ever taken to curtail the parallel economy. ... - Chanda Kochhar, CEO and MD of ICICI bank"
yb-donkey: Though she is the Chair-person of the largest Private Sector Bank in India, in my humble opinion, she does not know much about the true nature of Indian Economy and its problems. She wants to curry-favour with the Government, by praising it.
President of India Verified account @RashtrapatiBhvn
#PresidentMukherjee called upon people not to panic and follow Govt guidelines for exchange of Rs 1000/500 notes President of India, at Twitter.com.
yb-donkey: President of India is also a politician. It will be dangerous to comment on what the President or President says, in the current environment.
"...Other denomination notes of Rs 10, 20, 100 and 1,000 will be printed in the due course of time. --- RBI"
yb-donkey: There may not be any such need. People will design their own methods of "new money" such as barter, and also new methods for "storing value". Earlier gold, silver, precious stones were serving this purpose right from the YudhishThira days when King Marut stored his gold below Himalayas (as per mythology). Today, even 'real-estate' serves as a storage value, They have already staged a come back. Even if they become scarce, new materials/substances/ modes can be found. However, acquiring real estate for 'storage value of money' will become a problem, because of Government's restrictions. Yet, different forms of money- distinct from paper money, can be evolved, have been evolved since long. Here, the adage "Necessity is the mother of invention" will apply.
Between 2011-2016, circulation of all other denominations has grown by 40%. But, circulation of Rs 500 and Rs 1,000 grew by 76% and 109% respectively: Shaktikanta Das, Secretary, Department of Economic Affairs, Govt. of India.
yb-donkey: Mr. Shaktikanta Das seems to have forgotten about inflation. What Rs. 100/- was purchasing a decade back, Rs. 500 note is buying now. ONLY the number on the piece of paper has changed.
"...Great move Sir, many Black money holder going to get heart attack today. ..." -- A reader by name Santosh.
yb-donkey: Black-money holders are as intelligent as Mr. Narendra Modi, if not more, some of them, intelligent than him. Temporarily they may lose some piece/peace of mind, because they have not anticipated the risk, and actively converted their TOTAL money into some other medium. Intelligent Black-money holders might have already sufficiently hedged themselves. It is not possible to get 100% protection anywhere, through any method. For that reason alone, there is a proverb: "Do not keep all your eggs in one basket". And they might have already kept their eggs in different baskets, except innocent persons who are not intelligent enough to hedge themselves. Even if they lose one basket of eggs, they only lose partially, for which there is no need to get heart-attack. Only foolish black-money holders keep all their money in Rs.500-1000 currency bundles. Supporters of Mr. Narendra Modi appear to be hasty in drawing conclusions, just as Mr. Modi is an expert in making tall promises, and creating jumlas, making mountains out of mole-hills.
To continue. सशेष. ఇంకా ఉంది.