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Old 10th November 2016, 18:16   #301
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by sukhoi30 View Post
Yes, I knew this would be the problem and that is why I decided not to go and exchange my cash in the bank today. I would rather deposit the cash in bank and withdraw from the ATM tomorrow when that starts. You will get more Rs. 100 notes in the ATM machines.
ATMs will start disbursing Rs 50 notes from Nov 11.

http://www.thehindubusinessline.com/...cle9323117.ece

Appears majority agree with the move (can we add a poll?).
However some feel time should have been provided to prepare. But I tend to agree that would have lost the element of surprise.

Technically, I do read the news as Rs 500 and Rs 1000 are no longer valid. You are accepting them at your own risk.

Those in metros, larger cities, towns need to help the lesser fortunate folks to understand what is happening and how to wade through this. We spoke to the domestic help who comes and have explained what needs to be done. None seemed to be in panic.

This is not an end to black money. But will bring some of it back into our system. The success of this exercise would be how much black money really comes out into the open. Probably also not the last time this will be done. I also dont think this will help moving to a cashless economy in a large way. May give it a small nudge but nothing more. The internet penetration and literacy in our rural areas is very less to be thinking about a cashless/ digital economy so soon.

Last edited by kmadhok : 10th November 2016 at 18:18. Reason: additional after thought
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Old 10th November 2016, 18:18   #302
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by gsurya View Post
This is a pathetic & fascist way to cast those who comment on any Govt policy as anti-national.
Sir, I did not cast you as anti-national. Neither do i appreciate being called fascist. I said that those who rant may be from these four possibilities, out of which one was that the larger picture was not known to them. i do not know why you assume that out of the four possibilities given, you are being targeted as anti-national?

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... that is causing huge hardships to poor & middle class.
My understanding is that it is not causing any hardship, or at least any hard ship that cannot be tolerated or borne.I had the opportunity to discuss the situation with quite a few economically challenged people and the feedback that i got was one of righteous indignation against those who are presumedly "supporting" the poor.
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My mom's operation got postponed by a few days due to this.
Sorry to hear about your Mom's ailment and hope she gets better soon.

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Originally Posted by bbhavan View Post
I don't understand why some members are trying to oppose this move. I fear either they have not understood this very well or just voicing difference only for the sake of doing it.
Count me in. I do not understand why they are opposing too. It is a good move to at least remove the black money in circulation. Yes, the black money that has been converted into assets would take other strategies to be flushed out.
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Originally Posted by Nissan1180 View Post
I'm deeply disappointed that you take such a biased view of the situation. Perhaps it's not an inconvenience for you-perhaps you have someone who could go through the trouble of changing your currency without you being physically present.
On the contrary, Sir, i went to my bank at 10:30 am this morning, and there was no queue at all. There were 6 tellers dispensing money. there was an officer to oversee. I gave a self cheque and received my money in 100's; 50's 20's & 10's. By the time i finished, there were 4 people behind me, and maybe the same with all tellers. It would have taken probably 20 minutes to wait? Not too much to ask if we need to set things right. Right? I grant that it could have been different in other banks and areas.

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Lets not be judgmental about things so quickly.
Thank you for accepting this.

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Originally Posted by Queryanalyzer View Post
I am okay with the 2000 denomination as it will solves my purpose. But if I were to buy something worth say Rs.200 I am in big trouble.
I had the opportunity to talk to two bankers. They assured me that there would be no shortage of money and replenishments were being closely coordinated. Any one had any trouble?

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Originally Posted by gsurya View Post
A better move would have been to take out 1000 Rs notes entirely from circulation, NOT to introduce 2000 Rs note and stick ONLY with 500 Rs notes - with better design & security. This will actually have a better impact on cash hoarding going forward.
Well, let us wait and see.
I am of the view that the step taken by the government is a bold one and one that should lead to tangible benefits for the country and its citizens. There is no doubt that other measure need to be taken, but let us at least have the grace to accept that it is a step in the right direction.
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Old 10th November 2016, 18:22   #303
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by civic-sense View Post
People fall for solutions that sound simple to them. Solutions like killing murderers, castrating rapists and chopping of hands of thieves. It is like putting a skin coloured band-aid on a wound. A quick and easy fix for a more complex problem. Nobody cares about addressing the root cause. Why people hide money? How to make people spend than hide it? To bring the money back into the economy, you should rather encourage people to spend it. Not penalise people for earning it.
Not clear what you want to say, but people does spend. Those who earn more, spend more. Those who earn unscrupulously, spend it that way (apart from normal ways). You have more cash, you are willing to spend more on daily need items. And if you run out of white money, you have black money to spend. This is a big reason of high inflation (on a positive side, this might well be the reason why Indian economy was not much affected by global economic slowdown). Ever wondered, how people are buying 6-7 crore worth of apartments? Ever wondered how is it that there are no job growth, high inflation but still domestic demand is high, coupled with the fact that banks' bad debts are rising and liquidity in banks is seriously challenged? all because of black (unaccounted) cash money running through the system.

A salaried class person with no other source of money/unaccounted money, feels the pinch and wonder - what is going on? Inspite of getting a fairly good salary hikes every year, I am still struggling to make ends meet? While small shop owners/small businessmen/dealers/RE agents are driving around in big SUVs, flaunting Iphones and fat gold chains?
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Old 10th November 2016, 18:30   #304
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

I am a salaried person and totally support this move. Let me fast forward

01-01-2017:

1. Only new 500/- and 2000/- rupee notes are available.
2. Cash withdrawal in ATM is restricted to 20000/- per week.
3. All high-value transactions (eg: gold, property, car) are tracked.
4. All digital transactions can or may be tracked.
5. IT - department will start scrutinizing the deposits made between 10-Nov-16 and 31-Dec-16.
6. Responsible citizens will use cheques or cards or bank transfer or other online modes.
7. Tax collections will increase.
8. Chances of reduction in Income tax slab will be on the cards.
9. Buying power of the public will increase.

One has to wait for a long time to stash money. People who have converted current black to white through agents or lower income group will start collecting the bills from them and accumulate to do large transactions without tax. This is where I am not able to understand. Finance experts can throw more light.
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Old 10th November 2016, 18:30   #305
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by civic-sense View Post
People fall for solutions that sound simple to them. Solutions like killing murderers, castrating rapists and chopping of hands of thieves. It is like putting a skin coloured band-aid on a wound. A quick and easy fix for a more complex problem. Nobody cares about addressing the root cause. Why people hide money? How to make people spend than hide it? To bring the money back into the economy, you should rather encourage people to spend it. Not penalise people for earning it.
Encouraging people to spend is being done through re-structuring and simplifying tax structure.

De-monetization was done to cast a wider net and include more people into tax 'scheme of things'

If you are suggesting no tax - a la Ayn Rand way, I say it is too idealistic and not work.
Way to go is a simplified and rationalized tax structure and majority of citizens should be part of direct tax paying set.
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Old 10th November 2016, 18:38   #306
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by kmadhok View Post
However some feel time should have been provided to prepare. But I tend to agree that would have lost the element of surprise.
This article: http://www.livemint.com/Money/WTRdjK...orruption.html

puts out a couple of points of view why the element of surprise was needed. Her arguments for not giving a long enough time for the transition:

1. Cash would be converted to gold etc.
2. Cash would be palmed off to the weakest members of society.
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Old 10th November 2016, 18:45   #307
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by Queryanalyzer View Post
I am not talking about me. I can use debit/credit card for almost all of my needs. I am talking about the vegetable vendor, the street sweeper, the construction workers. Neither I nor my sisters could manage to buy anything from the local stores (the ones that dont accept cards) around here. Why? Because they dont want to be stuck with the 500 bill.
You seem to be dodging the simple question I asked .
Everyone understood that the old currency notes of 500 & 1000 are no longer valid and need to be exchanged. The message was actually loud and clear. The PM's address and subsequent media-coverage was quite straightforward. So your statement "Rs.500 and Rs.1000 is worthless is that message that everyone got." is actually not true and a gross generalization.
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Old 10th November 2016, 18:45   #308
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

As some people here think other people are just making up issues to criticize Govt. A list of issues seen in my circle of family & friends today:
  1. Massive queues at banks - 2+ hours at some
  2. Some banks stopping in an hour as money got over
  3. Some banks did not start working until 2 PM as there was no money
  4. Workers returning recent salaries to employer requesting dispense in 100s
  5. Workers rushing back home to villages as id proof back home
  6. Many villagers who rely only on Panchayat to disseminate information remain clueless about whats happening & the procedure and being fleeced
  7. Some banks insisting on Aadhaar, which many dont have
  8. Huge time taken at counter as some banks are listing each note serial number
  9. Post offices are even worse at money handling than banks, lot of issues
  10. Many banks ran out of smaller denominations, left only with 2000!
  11. From tomorrow ATMs also have to be stocked, so banks worried about sufficient money
  12. Many companies/contractors that use daily workers stopped working as no money to pay
  13. Huge corruption by jewelers & dalals exchanging notes for gold/commission
  14. Huge business losses for day traders in various goods
  15. Day & migrant workers of any kind most affected - as most dont have bank account at place of work, usually at hometown
  16. Poor, elderly, women most affected as they are usually not connected to the grid, dont have ids, bank accounts etc
  17. Big problems especially for those who were in the middle of marriages, travel or hospitalization

I grant that today was only day two & things should smooth out with time - but this will have repercussions on many ordinary citizens, much less on us upper class.

Last edited by gsurya : 10th November 2016 at 19:07.
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Old 10th November 2016, 18:51   #309
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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On the contrary, Sir, i went to my bank at 10:30 am this morning, and there was no queue at all. There were 6 tellers dispensing money. there was an officer to oversee. I gave a self cheque and received my money in 100's; 50's 20's & 10's. By the time i finished, there were 4 people behind me, and maybe the same with all tellers. It would have taken probably 20 minutes to wait? Not too much to ask if we need to set things right. Right? I grant that it could have been different in other banks and areas.
You are one lucky person.
I went to the back a little after 10AM. There were two lines, one was for exchange and the other one was for deposit/withdrawal. The exchange line was long and was over flowing out into the street. I wanted to deposit Rs.15,000 in cash (that my dad had withdrawn a day earlier) and I also wanted to withdraw Rs.10,000 (using cheque). When I got to the counter, after waiting in line for about 20 minutes, I didnt have any trouble depositing the money but I was told that they are running out of cash (they wanted to use what they have for exchange, the cash truck that was supposed to deliver in the morning has been delayed) and refused to cash my cheque. I was asked to come after 1 PM.
So I went to another back, I got there at 10:40AM and when I stepped out I had 5 x Rs.2,000 and it was past noon. I couldnt exchange the Rs.1,500 that I had as the bank was issuing just the 2000 notes and nothing else.

PS: The bank personal were all super nice. They offered water to people standing in line, photocopied IDs, and generally very helpful.

PPS: My sister didnt have any luck at all. A nationalized bank told people standing in line that they can service the first 50 in line and asked the rest to go home.

Last edited by Queryanalyzer : 10th November 2016 at 18:53.
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Old 10th November 2016, 18:51   #310
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by bblost View Post
As proof of identity they use any fake driving license photocopy. Since its for the 4,000 no one is really paying a lot of attention.
I think apart from xerox, original id is also required to be shown to bank official. Without the verification of original the whole process gets defeated as you pointed out.
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Old 10th November 2016, 18:52   #311
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Cut your losses, get rid of the black money you have as a total loss or through 200 for 500. For the future, make sure that you hold instruments the government can't change. System reboot complete, virus evolves.
True "black money" ain't in rupees. While this does affect what comparatively little amount is in the country,and it's fun to watch the bribe taker/real estate guy/used car dealer fidget about what to do with the mountain of money in his storeroom, the future is Luxembourg. Good fun from the champs of fun.
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Old 10th November 2016, 19:06   #312
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You seem to be dodging the simple question I asked .
Everyone understood that the old currency notes of 500 & 1000 are no longer valid and need to be exchanged. The message was actually loud and clear. The PM's address and subsequent media-coverage was quite straightforward. So your statement "Rs.500 and Rs.1000 is worthless is that message that everyone got." is actually not true and a gross generalization.
I hope this doesnt some off as offensive, but have you tried waking into a store (and I am not taking about super markets) and buy a product with Rs.500? I tried to reason with the guys saying they can exchange it but no one wants to hear it.

I understand your point of view. You are being logical, but things are not working that way.
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Old 10th November 2016, 19:16   #313
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

Spent about 2.5 hrs in the queue to get 4000/- exchanged. Frustrated people and tellers. Arguments and people trying to sneak into the queue. The teller wasn't even checking the original ID proof - I can sympathize with him given the situation.

When I was returning home around 5pm I saw queues spilling onto the road from a HDFC bank. I have reservations as to how well the ATMs will be replenished in the coming days .

Last edited by sdp1975 : 10th November 2016 at 19:27.
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Old 10th November 2016, 19:21   #314
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Default Re: Effect of Rs. 500 / 1000 note ban on the Indian car industry

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Originally Posted by RSR View Post
On the economics thread, I have always maintained that fiat paper currency (not coins) is nothing but artificial (man-made) money that can be turned completely worthless in no time at all (like in Zimbabwe, ex-Yugoslavia, Weimar Republic etc.) and that only precious metals like gold, silver etc. are true (God-made / nature-made) money!
I would call Gold/Silver as ASSETS (long term store of value) rather than 'money'. Paper currency (bank notes) is just a tool to facilitate transaction of products and services between two parties. They can store value too, but only for a short period of time (inflation will nibble into the returns).

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The hardcore advocates of fiat paper currency had a huge problem with accepting such a basic truth about money on that thread. I guess fiat money fanboys and fangirls would have received the biggest shock the day-before-yesterday
When you use the word FIAT and FANBOY in a sentence, some people might get confused!
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Old 10th November 2016, 19:24   #315
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by earthian View Post
.....
On the contrary, Sir, i went to my bank at 10:30 am this morning, and there was no queue at all. There were 6 tellers dispensing money. there was an officer to oversee. I gave a self cheque and received my money in 100's; 50's 20's & 10's. By the time i finished, there were 4 people behind me, and maybe the same with all tellers. It would have taken probably 20 minutes to wait? Not too much to ask if we need to set things right. Right? I grant that it could have been different in other banks and areas.
......
Sir, did you go to private or nationalized bank?
Which area in Ahmedabad and which bank if I may ask.

I am holding back any trips to bank to avoid rush - luckily couple of weeks back, my trip to ATM yielded only 100 rs notes and I still have around 10-12 notes - feeling rich!
May be this weekend I will take a stock of all 500-1000 currency notes in household and whenever there is lean period - will go and convert

Last edited by SDP : 10th November 2016 at 19:48. Reason: typo
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