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     Thedarkknight Pilla Bewarse Username: Thedarkknight Post Number: 549 Registered: 07-2008 Posted From: 183.83.26.5 Rating: N/A |
Actual aim is to “curb the corruption, reduce the black money usage & bring out the existing black money”. Overall review: an awesome effort spoiled by the 2000Rs note. 200rs note would have been super effective. Few Basics: Options for exchanging the existing cash. Deposit into any bank or post office account ( No limits for the deposit ) Limits will be imposed on the withdrawals in the near future. Limits would increase as time passes by. ============================================= Short Term Impact on Black money Reduction: Moderate to high Short Term Impact on fake currency: High Short Term Issues for the innocent Tax Payers: Moderate to high for next few days depending on the requirements. ============================================= Impact on black money Reduction: Anyone can deposit the cash into their bank and post office account ( there is no limit imposed on the deposits). So tax payers ki emi problem ledu, They can just deposit all the cash that they have. Black money tho complete ga business chese-vallaki koncham problem. Though they have network, they need to find people ( They can find it for % commission pay ) for converting the existing black money. Inka chala ways kanipedatharu for converting ( to properties & other assets ) but they loose some % of cash. Actual target entantey vellantha vachi banks lo money deposit chesi tax kadutharu & dorikipotharu ani. Chances of happening that are less in my opinion. Anyways, There will be money circulation, distribution to the network & there will be lots of transactions which is a reasonably good thing. Chinna, chinna illegal vyaparalu chesi black money dachukoni ela bayata padalo teliyani batch ki chala problems. Veellu basic ga baga target avutharu. They have to pay tax & penalties. Not sure about any other restrictions. Overall ga reasonably moderate to high impact in the "short term" with Lots of problems for Innocent tax payers in coming few days/weeks. Intention aithey, target chesindi complete ga black money tho business chese criminals ni, but ekkuva ga target ayindi chinna, chinna illegal vyaparalu chese batch. Impact on fake currency: All of the existing cash has to come to the bank or post offices, Fake currency would be easily caught. Highest impact. =============================================== Long term Impact on Black money Reduction: Low to Moderate. May be high depending on the functioning of ACB & Police. Long term Impact on fake currency: Moderate to High Long term impact on curbing inflation: Low (May have negative impact on inflation) =============================================== Impact on black money Reduction: In my opinion black money usage can be reduced substantially by reducing the denominations ( Prevention technique ), which will discourage the cash transactions and by encouraging the electronic transactions. 2000Rs note reduces the effectiveness of this whole exercise. Most of the transactions ( Real estate/ Jewelry/ Movies/ Sports and few other big transactions ) in India that happen as of today have significant “Cash component”. 2000Rs note will encourage the “parties involved in transactions” to go for higher cash component (Just because of the lower volume required for a particular cash amount. Storage & transport becomes less painful). Due to this particular issue there are high chances of white money (Accounted for in the bank deposits, investments & Property reserves) becoming black. Seems like the 2000Rs note will have nano gps technology to locate the hidden notes and curb the black money usage. This is a cure technique. For it to work effectively lot of people (ACB, Police, Task force) have to work responsibly with-out any fraud. All of us know how things work in india in general. Forget about india, I had faced a cheque kiting fraud in USA ( Bay area ) and registered a police complaint. There is absolutely no traction on the case even after submitting all the proofs. Everybody knows who the culprits are. Because of these reasons, the effectiveness of the exercise goes down significantly. Prevention is always better than cure. Impact on fake currency: The chances of fake currency of 2000Rs note are almost negligible ( due to the gps and nano technology ) and hence the fraudsters resort to lower denominations and fake currency would be reduced in general. Impact on inflation: Basic rule of economy: Higher denomination => higher chances of inflation (purely going by the psychology & spending dynamics). Spending power of people can be increased by lower denominations. Obviously, other aspects of “Demand Vs Supply”, “Production Vs consumption” determine the ultimate fate of inflation. 2000Rs note will have negative impact on inflation. 200Rs note would have solved the problem. |