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Old 17th May 2017, 11:10   #2401
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by sgiitk View Post
@ksameer1234; My info from the banks is that far less of the 2000 notes are coming back into circulation, ie they are being stashed away.
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The same black money cycle starting up all over again then?
I have been a pro-demonetisation chap all the while (please read all my comments in this thread). Six months after Dec 31st dead line, I must admit that I am getting more cynical.

1. In the city suburb where I stay, all the usual chaps who did transactions only via cash have started going the old way. Doctors have started demanding fees by cash. Medical shops etc., who did get credit card machines have now started saying that the machines don't work. This kind of confirms that the old "cash hoarding" tactics have started again.
2. ATMs still remain an erratic business, most of them are open for transactions only for 2-3 days a week. And they get emptied out soon as well. From what I observed many of the labourers/working class still rely on ATMs (which also means that they still rely on cash transactions).
3. From various parts of South India, large hoards of cash are now getting hauled up. The latest rumour is that they were all supposed to be sent abroad and then returned as income from foreign countries. Nagaraj & "Bomb Naga" an ex-don of Bangalore has now been picked up. He is ready to confess that the money was given by the big & mighty from Karnataka. In Kerala another racket got busted yesterday.
4. The RBI or Govt. of India still have NOT released any official statements about the black money hauls, or any progress made. They may be more confused than us, is what I feel.

What I do these days is to rely on my Tech.Park ATMs to pull out a fixed amount of cash - twice every month. I cannot rely on a 100% cashless transaction/digital mode. I have noticed that PayTM is unable to fetch my balance, when I am in some of the smaller towns. For quite some time most of my big payments like SIP and EMIs were any way done through NEFT/IMPS.
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Old 17th May 2017, 17:28   #2402
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by dailydriver View Post
You can try depositing through an NRI friend/relative.
The serial numbers are noted at airport customs, so they should have the notes at the time of entering into India. Its only those notes that are exchanged at RBI.
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Old 17th May 2017, 17:53   #2403
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by sachinpk View Post
all the usual chaps who did transactions only via cash have started going the old way.
While a lot of people who had resorted to cashless modes are again going back to cash, the infrastructure that came up in terms of POS, Paytm etc. is still there.

With reference to ATMs again running dry, may be this is a second wave where RBI is strategically controlling the flow of cash. To expect 1.25 billion people to go cashless overnight was unthinkable but it did happen. Now this needs to percolate as a habit which will happen in some time.

Quote:
From what I observed many of the labourers/working class still rely on ATMs (which also means that they still rely on cash transactions).
The comfort of using cash which built up over decades won't vanish so soon. However, that is the direction to go and we'll eventually get there.

Quote:
What I do these days is to rely on my Tech.Park ATMs to pull out a fixed amount of cash - twice every month. I cannot rely on a 100% cashless transaction/digital mode.
There are many like us who now visit ATM far less than before. Such percentage will only increase gradually.
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Old 17th May 2017, 19:18   #2404
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by narayans80 View Post
The serial numbers are noted at airport customs, so they should have the notes at the time of entering into India. Its only those notes that are exchanged at RBI.
Valid point. Thanks.

Green channel passage at airport customs doesn't apparently apply for Old High Denomination Notes being brought in by NRIs.

As per money control.com(God bless them ), Government requires that NRIs carrying old notes should declare them at the customs desk, fill a declaration and after getting it stamped, present it at RBI counters in specified cities. RBI will then route the deposits to their KYC compliant accounts.

Last edited by dailydriver : 17th May 2017 at 19:20.
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Old 17th May 2017, 21:30   #2405
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by narayans80 View Post
The serial numbers are noted at airport customs, so they should have the notes at the time of entering into India. Its only those notes that are exchanged at RBI.
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Originally Posted by dailydriver View Post
Valid point. Thanks.

Green channel passage at airport customs doesn't apparently apply for Old High Denomination Notes being....
Hypothetical Situation:
I'm an NRI returning to India after 1 year. I have a home in India but no family here. I have kept 20,000 in cash in demonitised notes in this house. What do I do with this money?
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Old 17th May 2017, 21:48   #2406
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by samaspire View Post
What do I do with this money?
Nothing can be done!

Ideal way would have been to ask someone trusted to go this house, get and deposit this money before 31-Dec-16.

OT: In reality, I find it hard to believe if somebody would've gone abroad leaving a house locked with valuables inside, unattended for that long a time. These are easy targets for vandalism.
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Old 17th May 2017, 22:14   #2407
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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What do I do with this money?

The Specified Bank Notes (Cessation of Liabilities) Act, 2017
makes holding 10 or more of the devalued currency notes an offence punishable with a fine of ₹10,000. (Not sure whether the same notes, say 1,000x10=10,000 would be accepted in lieu of fine ).

On the brighter side, a researcher or collector can possess up to 25 of these notes. However, in terms of monetary value, they are worthless. Ergo, the hypothetical 20k won't find a cozy home in any of our bank accounts.
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Old 9th June 2017, 13:55   #2408
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

Along with the reduction now visible in GDP growth, another possible effect of demonetisation?
"So why has a bumper crop led to a crisis in farming?
Some believe that the price crash is the result of India's controversial withdrawal of high value banknotes - popularly called demonetisation - late last year." The argument being that cash starved middlemen were not able to pick up all the extra production.

What is more sobering is another quoted fact: HALF of all Indian jobs are in farming, that contributes about 15% of GDP. Which means that this fastest growing economy in the world business isn't doing anything significant for half the working population. Along with recent reports of how Indian manufacturing is not adding jobs by being capital intensive, and the turbulence in the IT sector, the creating of 250 million net new jobs needed by 2030 looks a bigger challenge every time one looks at it.

Air India seems to be heading into turbulent times.
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Old 10th June 2017, 07:50   #2409
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

@Sawyer; A bumper crop almost always leads to a glut and a price crash. So nothing new, and no need to ascribe it to A or B. What is worse is that the previous years' high prices often lead to far higher sowing.
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Old 10th June 2017, 08:03   #2410
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by samaspire View Post
Hypothetical Situation:
I'm an NRI returning to India after 1 year. I have a home in India but no family here. I have kept 20,000 in cash in demonitised notes in this house. What do I do with this money?
I know of a friend who lost 45000. He couldn't take a flight to India just to convert notes.

He asked me if I could help, but then it was too late.

I wounder how many more years, we, common men will have to wait to see the benefit of highly boasted demonetization!
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Old 10th June 2017, 08:09   #2411
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by sj_koova View Post
I know of a friend who lost 45000. He couldn't take a flight to India just to convert notes.

He asked me if I could help, but then it was too late.

I wounder how many more years, we, common men will have to wait to see the benefit of highly boasted demonetization!
Ask him to hold on to these for a few years and then sell it on eBay for a profit. Collectors will lap it up.
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Old 14th June 2017, 15:33   #2412
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

Its coffee smelling time for more people.

I didn't expect Jaggi would give up so soon.

https://swarajyamag.com/economy/modi...ce-of-evidence
Quote:
'It is time for a mea culpa,' he writes. 'Now, and especially after the farmer agitations for loan waivers, I believe that the negative side of the ledger on demonetisation (DeMo) is larger than the positive. It has failed.'

Further, he says, 'the bottom line on DeMo, seven months after Modi announced that he was withdrawing the legal tender status of Rs 500 and Rs 1,000 notes from 8 November, is that the costs are outweighing the benefits. And the rising demand for fiscally ruinous farm loan waivers surely has a direct link to DeMo.'

There's a link between the growing farmers' protests and the note ban, he points out. 'It can also now be clearly said that DeMo was the last straw that broke the farmer's back, leading to a cascade of farmer protests and political demands for loan waivers.

'DeMo will damage the fisc like nothing else before this. Two consecutive droughts did not do as much damage as DeMo. All the fiscal prudence shown by the Modi government in the last three years will be washed away now in one huge burst of state government populism.'

In conclusion, Jagannathan notes: 'It is great to be thought of as a bold leader who can take tough decisions to break the back of black money. But it is not so great to go about it in a ham-handed way and breaking the back of the Indian economy in the process.'
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Old 14th June 2017, 15:50   #2413
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

It is called the law of unintended consequences. Linkages of money in the economy are both wide and deep to an extent that it is next to impossible to model/predict all the consequences of decisions to play around with it by top down diktats. The wise stay away from such edicts that can be weapons of mass destruction.

And on loan waivers, how does one waive loans granted by moneylenders and others? Is all the distress caused by loans given by banks? Or are these covered as well? And is the underlying problem that caused loans to be distressed being examined at all?

Back on the job creation front - I believe that while the economy grew by about 50% in the last 12 years, only 15 million new jobs were created, a growth of 3%.

250 million more to be created by 2030? India needs to address this subject on a bipartisan basis as a national emergency like a war. Because wars are less threatening to our security than a failure on this aspect will be. But where is the leadership to get such a national project underway? Instead, we are running around about cows, peacocks, liquor by highways, toilet building and many other distractions that don't allow us to focus on the onrushing train on our track.
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Old 14th June 2017, 16:37   #2414
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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And on loan waivers, how does one waive loans granted by moneylenders and others? Is all the distress caused by loans given by banks? Or are these covered as well?
Loan waiver I feel is a neat little bomb which the opposition have managed use with good efficiency. The nation as such is used to freebies and waivers/subsidies so it is quite natural that every one wants every thing to come from the government.

There were cases where the "farming loans" which were taken, was misused by the loan taker for other expenses like marriages. And as you rightly said, loan waiver can be given for loans from national banks, but loans from money lenders should not be waived off.

Money lenders were actually money-hoarders. Now if the farmers get money to pay a loan to the money lender, it is basically giving such people large sums of money to still play around with. What ever money the money lender had to deposit in the bank (due to demonetisation), may now come back to him through the hands of the farmer, who gets a loan waiver.
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Old 14th June 2017, 17:12   #2415
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Loan waiver I feel is a neat little bomb which the opposition have managed use with good efficiency.

There were cases where the "farming loans" which were taken, was misused by the loan taker for other expenses like marriages.
The opposition in a democracy will point out and take advantage of the situation when one poll bound state gets a waiver and the rest are left to fend for themselves. The government created the mess, it's a time bomb alright, but it's been ticking for some time and demonetization was the proverbial straw that broke the camel's back.

Like "farming loans", that were misused as you claim, (just exposes your ignorance about how the rural economy functions),there are a few business houses that are responsible for the NPA mess. They won't starve and they will be looked after, private profits and socialized losses, crony capitalism at its best. I'm sure you are OK with that.

There's approximately 10 lakh crores in bad loans, a farm waiver will be a drop in the ocean. The problem for farmers is that they don't get invited to TV studios to blame government policy and bankers' inflexibility on their inability to service their loans.
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