[cryptarchy]

Decisions like these have diminished my confidence in government policies. I have stopped investing in government deposits (PPF, SGB, Govt Bonds) and withdraw money from whenever possible like provident funds etc. I just don’t know when it will announce a random rule further controlling withdrawal or a new tax.

[Grr7]

Just saw sting ops by media on some Delhi Jewellers where they are openly converting Rs.2000 notes to other denomination at a commission(%).

Gold which has market rate of approx Rs.6300 per gm is also being offered at Rs.7000 per gm against Rs.2000 notes.

Mind you, this is not the 1st time these crooked jewellers and other such persons are doing this. This is just Demon 2.0 and all such people (crooked jewellers, dishonest bank employees) shall again make merry at the expense of common man's inconvenience (Yes, an extra round to bank and waiting for 45 mins today to get my 07 nos. Rs. 2000 denomination notes is an inconvenience for me).

[thanixravindran]

Originally Posted by V.Narayan

Bear in mind the promise on that note, which most ignore, and most do not understand, but which has a real legal meaning – “I promise to pay the bearer….” *Twice in a short span of time the Govt has damaged the foundation of the basis of our nations currency in which we earn, transact, store wealth and so much more. What stops them from tomorrow announcing that all bonds of debt of a certain class issued by the Govt of India stand invalidated by fiat. A rupee note or any other major currency is a bearer bond of value. May not happen in all probability but Tughlaq like acts are in vogue.

I couldn't understand this point. The solemn promise is still being kept earlier as well as now and the bearers are being paid the equivalent of the 2000 rupee note but in smaller denomination. It is not devalued.

As you mentioned, anything can happen only to fiat money. Real black money hoarders go for real estate and gold within country and we all know the trans border route. I don't believe we can ever solve the black money problem.

[alexgv]

Originally Posted by thanixravindran

I couldn't understand this point. The solemn promise is still being kept earlier as well as now and the bearers are being paid the equivalent of the 2000 rupee note but in smaller denomination. It is not devalued.

The way i interpret this point is for the last round of de-monetisation. The RBI has reneged on the promise to pay the bearer the value of rs 500 on the note.
I have 1 such note. Now it is a souvenir of the one of the night mare we had spending time in lines in banks and atms.

[V.Narayan]

Originally Posted by thanixravindran

I couldn't understand this point. The solemn promise is still being kept earlier as well as now and the bearers are being paid the equivalent of the 2000 rupee note but in smaller denomination. It is not devalued.

Legitimate question. Let's say you own a plot of land. It is yours on paper no one denies that. But the local dada landlord lays down conditions under which you can access your land. That is what is happening here to lakhs of agriculturists, mirco, mini & small businesses who hold these notes legitimately. I have no sympathy for the hoarders and the hoarders all honed their skills in 2016. This time it is a slam dunk for them. Only the genuine folks get affected. De-monetization to curb black money is like using iodex to heal a broken bone or more macabrely using cold cream to heal skin cancer. The story line of being the virtuous who fight black money is for consumption for a certain segment of the voters who are eager to believe these lines.

As you mentioned, anything can happen only to fiat money. Real black money hoarders go for real estate and gold within country and we all know the trans border route. I don't believe we can ever solve the black money problem.

Black money has not reduced a jot since 2016. By most accounts RBI received back almost all or a little more notes than it believed it had printed. If black money had been unearthed the Govt would have announced it from the roof tops every two months. All they achieved was inconvenience crores of honest citizens and destabilize the GDP from an 8% growth to a 4% growth*.

I stand by my earlier assessment this move is strictly political, after the defeat in KA to dry up the coffers for the State elections later this year and the national elections in 2024.

PS: I have no Rs 2000/- notes. This doesn't affect me at all. But I am concerned at the policy trends this reflects and the mindset of those taking these decisions. Since 1947 we had three demonetizations if we count this as a quasi DeMo - 1978 under Morarji Desai another leader with worryingly limited understanding of economics. That was the Rs 1000 note which in today's value was like a Rs 12000 note! The impact was minimal as very few such notes were ever printed. Then we had 2016 and now 2023. 3 DeMo's in 75 years of which 2 occur under one rule! The trend line is clear. On a facetious note - The new Rs 500/- note in Jan'23, anyone?

*Albeit there were others causes too behind that.

[ashis89]

Originally Posted by V.Narayan

That is what is happening here to lakhs of agriculturists, mirco, mini & small businesses who hold these notes legitimately. I have no sympathy for the hoarders and the hoarders all honed their skills in 2016. This time it is a slam dunk for them. Only the genuine folks get affected.

I still don't get it sir, what's the issue faced by non-hoarders? If someone is holding legitimate money, they can walk to their nearest bank to deposit in their bank account or exchange the notes for a smaller denomination. Yes, there's hassle in going to the bank but other than that, the banks continue to honor the promise made on the note.

[V.Narayan]

Originally Posted by ashis89

I still don't get it sir, what's the issue faced by non-hoarders? If someone is holding legitimate money, they can walk to their nearest bank to deposit in their bank account or exchange the notes for a smaller denomination. Yes, there's hassle in going to the bank but other than that, the banks continue to honor the promise made on the note.

Thank you for your question. It is still an inconvenience for what is legitimately yours. Say you are a farmer with Rs 200,000 in Rs 2000 notes. Now deal with the local bank. It will get done after X trips and Y paperwork and Z time. But why should a citizen need to go through that to continue owning what is already his when this has zero economic value to the nation. IMHO we cannot measure this vast and super diverse land of ours on the experience of us salaried UPI/electronic banking using top 2% of the population. You & I are scarcely affected. I can't write further but would violate Team BHPs code.

Originally Posted by MBond007

Yesterday I was having a conversation with an acquaintance who has deep connects in the ruling party. As per his words, this action has been taken keeping the upcoming Assembly elections in mind. The party had managed to stifle the coffers of its opponents in Gujarat elections and the result was an astounding win for the party. Since the general election is nearby, the party does not want to take any chances in the upcoming Assembly elections and hence the master stroke.

Thank you for saying this.

[tsk1979]

Originally Posted by ashis89

I still don't get it sir, what's the issue faced by non-hoarders? If someone is holding legitimate money, they can walk to their nearest bank to deposit in their bank account or exchange the notes for a smaller denomination. Yes, there's hassle in going to the bank but other than that, the banks continue to honor the promise made on the note.

The bank is very far, and I haven't learnt the common skill of walking over water to travel to India. So to change about 6000rs, I will have to spend 100,000rs in air tickets and make a trip to India before September.

[vishnurp99]

Originally Posted by V.Narayan

IMHO we cannot measure this vast and super diverse land of ours on the experience of us salaried UPI/electronic banking using top 2% of the population.

UPI has accelerated financial inclusion over the last few years. Electronic payment is no longer used by only the top 2% of this country. So this argument doesn't hold any longer. This may have been relevant during demon-1.

Any government rule will inconvenience somebody or the other. As long as the government doesn't come out with a higher denomination note in the near future, the benefits of this step are really clear in my mind.

[ashis89]

Originally Posted by V.Narayan

Thank you for your question. It is still an inconvenience for what is legitimately yours. Say you are a farmer with Rs 200,000 in Rs 2000 notes. Now deal with the local bank. It will get done after X trips and Y paperwork and Z time. But why should a citizen need to go through that to continue owning what is already his when this has zero economic value to the nation. IMHO we cannot measure this vast and super diverse land of ours on the experience of us salaried UPI/electronic banking using top 2% of the population. You & I are scarcely affected. I can't write further but would violate Team BHPs code.

Thank you for saying this.

I am not putting myself in their shoes but trying to imagine the problems that people might go through.

One has time to use the notes over the next 4 months to meet expenses. Whatever is left needs to be exchanged. Yes it is an inconvenience especially to the poor or those in remote or old/disabled. Yes it doesn't add any value. But then so was the mandatory IND plates for 12 year old car my father owns or getting some land records 'regularised' which my aunt owns for last 30 years. Both these were major inconvenience and needed frequent runs by senior citizens to get it done. But they were legitimate tasks and the work got done eventually. I know I am not comparing the apples to apples here but still a thought.

All that said, I agree this move is a political one and targeted to eliminate competition. I hope this helps in some wealth redistribution just like the last demon. did.

Originally Posted by tsk1979

The bank is very far, and I haven't learnt the common skill of walking over water to travel to India. So to change about 6000rs, I will have to spend 100,000rs in air tickets and make a trip to India before September.

Govt. has announced that NRIs will get special reprieve.

[warrioraks]

Originally Posted by tsk1979

The bank is very far, and I haven't learnt the common skill of walking over water to travel to India. So to change about 6000rs, I will have to spend 100,000rs in air tickets and make a trip to India before September.

You should not be worried.

The 2000 rupee notes are still going to be legal tender post 30th September. Whatever the heck that means!

[rx100]

Originally Posted by warrioraks

You should not be worried.

The 2000 rupee notes are still going to be legal tender post 30th September. Whatever the heck that means!

How that would be possible if banks will not accept it post Sep 30th. How can it remains a legal tender?

[Funny]

Originally Posted by rx100

How that would be possible if banks will not accept it post Sep 30th. How can it remains a legal tender?

Similar to previous demonetization exercise, RBI will allow exchange of 2000 notes through special counters for specific cases like NRIs post the Sept 30 deadline. As long as you have genuine reason for not being able to exchange the notes within the given deadline, RBI will allow you to exchange the notes post deadline also.

[tsk1979]

Originally Posted by warrioraks

You should not be worried.

The 2000 rupee notes are still going to be legal tender post 30th September. Whatever the heck that means!

Originally Posted by Funny

Similar to previous demonetization exercise, RBI will allow exchange of 2000 notes through special counters for specific cases like NRIs post the Sept 30 deadline. As long as you have genuine reason for not being able to exchange the notes within the given deadline, RBI will allow you to exchange the notes post deadline also.

See this is the issue. Whenever they plan something, i know it will not work. What if they deadline is till September 2024 and I cannot make a trip before that.

The bottomline is that, RBI promised something, and is renegading on that, so why should I trust anything they say.
Fool me once.. Fool me twice and yada yada

And I am not even sure if all this black money talk is a hoax. There is hardly anybody having black money in India. : Doing this for 0.7% of money does not make sense

https://www.investopedia.com/news/in...oney-returned/

[Formula1]

Originally Posted by tsk1979

The bank is very far, and I haven't learnt the common skill of walking over water to travel to India. So to change about 6000rs, I will have to spend 100,000rs in air tickets and make a trip to India before September.

Woah! Excuse me dear sir. Did you forget that our soldiers (and somebody else apparently) aren't sleeping... or something like that...

Way to show your privilege.