[chdir]

"It’s like the PM is cleaning a pond to kill the crocodiles, forgetting that crocodiles can survive even on land. Big crocodiles have survived. Small fish have died." [1]

The immediate reaction of the common man on de-monetization of higher currency notes (followed by replacement with newer ones) was euphoric. A popular thought process was that people can tolerate inconvenience for a few days because it'll invalidate the "black money" [2] and thus rein in inflation, property prices and corruption to some extent. However, the moment this was announced, people have been brazenly finding loop-holes to convert their currency notes through unofficial means. Example : back-dated receipts for expensive items (gold, cars, property), fake accounts, hiring poor folks for conversion via official channels, bulk purchase of coupons / cards for essential items that are permitted to accept older notes, etc..

[1] http://indianexpress.com/article/india/india-news-india/demo...

[2] Untaxed money, undeclared income, ill-gotten money via bribery, fraud etc..

[gnipgnip]

You missed,

- Using employees salary accounts to rapidly deposit and withdraw money.

- Bribing officers in Banks.

I was downvoted earlier on HN when expressed skepticism, since this policy is definitely not intended on curbing this so-called "Black money".

After the massive influx of cash, PSU banks have gotten more reserves to pay for their earlier bets that have now run foul (which they were forced to place by the state).

I can't believe for a second that BJP managed to prevent some lowly Greenpeace activist from leaving India, but was unaware of Mallya's escape. This is not surprising considering not much has changed politically since when the dude responsible for Bhopal was escorted and allowed to flee by the then Prime and Chief Ministers - one of whom was apparently hiding in his princely bungalow far far away from the leaking MIC.

BJP is essentially a Hegelian dual for the INC (& associated fools), nothing more nothing less (the policies clearly show this).

[shubhamjain]

> However, the moment this was announced, people have been brazenly finding loop-holes to convert their currency notes through unofficial means. Example : back-dated receipts for expensive items (gold, cars, property), fake accounts, hiring poor folks for conversion via official channels, bulk purchase of coupons / cards for essential items that are permitted to accept older notes, etc..

Plugging loopholes is the only enduringly useful thing that would come out of this exercise. Although, yes, the ones you mentioned have been marginally successful, the administration is doing a decent job at addressing them. For eg, people exchanging cash need to have their nails marked with indelible ink to foil crowdsourced attempts at laundering money, people with abnormally high deposits, with respect to their I-T returns, will need to explain their source.

I remain ambivalent about the approach, or its immediate benefits. However, what will prove effective isn't necessarily an excellent tax collection for the year, but making a big leap towards a transparent economy. That, however, remains to be seen if it's only a pipe dream.

[chdir]

The modus operandi (of loopholes) is nothing new, it's second nature to many businessmen. I wonder why there weren't enough checks in place when the plan was announced.

[raverbashing]

And this is what most high-rated comments here are misisng.

The less money people have the more they will be inconvenienced, not the opposite

[zac99]

PM is waiting outside to kill crocodiles coming out from pond, so that fish can survive and live peaceful

[saiya-jin]

don't for a second take any populist politician out there by word - they always over-promise to get elected and under-deliver. after all, it's all just a power game to them.