Yesterday night was a bit of an excitement mixed with frenzy for many as a NEWS spread in India during the midnight hour, once again, since the declaration of our independence. The NEWS was that Modi has abolished notes of Indian Rupee valued at 500 and 1000 overnight - the highest denomination in the notes currently printed. Everyone who has these notes, have time till December 31, 2016 to account it and exchange it in banks or post offices.
- Black money stored in the form of currency notes within the country will be flushed out as people will not be able to account the same or exchange it unless they put in a lot of effort to do so
- Future storing of black money in the form of notes will be difficult as Rs.100 would bulk up more than 10 times and consume as much space than the situation is at present
- Price of gold will raise; as this will be a safer and more culturally common and relevant way of storing excess money now. This means more returns for people who have been investing in gold already
- Money might be easier to handle and track with debit card transactions that might become more common as card transactions might be preferred over bulky cash transactions - making business faster and waiting in queues shorter
- The use of plastic money might boost e-commerce and cashless exchanges - the new trend for start-ups in India
- Thefts and pickpockets might go down taking crime rates down with it
- There is a hint that the notes have been replaced with 'new' 500 and 2000 Rs. notes. Then this whole thing is a humbug. Point 2. of the pros is then off the list (Source: PM Modi had today banned not just these two high value currency denominations, he had also unveiled their replacement, in the form of a new Rs 500 note and one of Rs 2,000.)
- Black money storage from the current point forward becomes easier with the current highest denomination doubled. Which means Point 1 and 3. of the pros is off the list too since people will find an alternative means to shrink their storage place and find new space to store more with a higher denomination being made available
- The whole frenzy of the people to dispose the notes they have is foolish as there is time to do so till this year end. So calm down people; the world is not coming to an end (...yet)
- Business - especially chota valas who refuse currency notes of 500 and 1000 denomination are more foolish. Business is more important and customers harder to get. These notes can anyway be exchanged and it would be a boost to the business if a shop keeper accepts the notes and gets the commerce going using this situation and reaping the harvest. Requires sense to think in this case - the hardest commodity to ask for anyways these days
- The corrupt will become more corrupt and find reasons to accumulate what they have lost in this barter in the near future - habits, not notes, that needs to be abolished
- In this case of taking old notes and releasing new ones, then, is just going to be like how Mohd. Bin Tughlak shifted his capital from Delhi to Daultabad/Deogir - a 'tughlakian' decision that made him lose more than he thought he could earn and an earner of negative press that we learn about till date of 'what not to do'
- One more ban, one more renaming and one more flop awaiting - as is the sequence in a country where people think like a slow starting tubelight
- Anyways, the initial election manifesto was to bring back black money deposited abroad into India within 100 days that entered a delay as it required a change in taxation policies. What happened to that? Did we change our double-taxation system? Are we still talking about that?
- Wouldn't this exercise make the people who foreignized Indian black money look smarter than their Indian counterparts and help set an example for the corrupt to emulate for the future?
- Is this once again the typical re-naming stunt that is not uncommon these days. After all, what is in a name?
Seems like the con's outweigh the pros in this (dis)regard just for the simple reason that the notes are going to be re-introduced and very soon, in higher denominations. Was that a calculation intended or a consequence unthought of?!
However, this great idea (minus the reintroduction bit) I remember coming from a Tamil movie called 'Pichaikaran' that was released in March this year and here is the scene from the movie for proof that the idea is not something that was born yet only something that has been adopted. Talk about originality...