17 Jan

Trumponomics and China’s Yuan Devaluation

Though Donald Trump was a strong presidential candidate, people, businesses, wall-street and a lot of people around the world wanted Hillary to be the 45th president of United States.

 

It was a great win for Trump, as we have expected that he would be the winner at the end. Trump policies are having been very much authoritative and expect to create employment and bring back outsourced business back to United States. Therefore, he has proposed a series of tax benefit to manufacturing and employment creating in US businesses and planning to impose tariff on businesses which import goods and services to US- like BMW and Mercedes, where Trump government is planning to impose a whopping 35% tax on import. Not just businesses but even governments around the world- China, Turkey, Saudi Arabia, Israel etc are on high alert to fight back at every level-economic or political for various reasons.

 

Trump is going to swear as the 45th president of United States on 20th January 2017 and the world is distracted from the most important forthcoming event currency devaluation by China. China is planning to wage a Currency Wars with United States and the world by devaluating the Chinese Yuan.

 

China has played this card quite a few times in the past, last 2 times being December 2015 and January 2016 by 2%. Prior to that in August of 2015 during the holiday season by 4%. This 4% of Chinese Yuan devaluation (see picture below) has made Dow plunge by 500% in a session, which made into 8th place in the worst single day crash in the Dow history.

 

USD Vs CNY- China Yuan Devaluation

USD Vs CNY- China Yuan Devaluation. Source: www.XE.Com

China had a war chest of USD 4 trillion dollars in forex reserves in the beginning of 2015. Due to slow down in GDP numbers and fear in the market Chinese are looking for every opportunity to get Yuan to a foreign currency by purchasing real estate and businesses overseas mainly in United States, Canada, United Kingdom, Australia, New Zealand etc. This flight of capital in truck loads is creating more weakness making the recent forex reserves around USD 3.01 trillion. Capital controls have been enacted to stop people and businesses to let the Chinese Yuan move out of the country.

 

China has dumped enough dollars to keep the Yuan stable. But this way China is losing in precious forex reserves just to keep the Yuan stable, which can turn to be a horrendous irrecoverable mistake. Recently IMF has degraded the China’s ratings and slowing GDP numbers. While the global economy is also slowing at dangerous pace. And Chinese’s are no different, their domestic economy, employment, government deficit spending, real estate bubble have accelerated the slowing down of the economy.

 

Today’s Trump comments has made dollar fall against major and emerging currencies by about 0.5% and 1%. And Trump specifically said the dollar was too strong in the context of China’s Yuan saying “Our companies can’t compete with them [China] now because our currency is too strong. And it is killing us.” He said the Yuan was “dropping like a rock” and the central bank supported it simply “because they don’t want us to get angry.”

 

The only way China can save itself from the coming collapse is to devalue its currency by waging currency wars. Right now China has been devaluing currency in smaller steps (check the exchange rate for last 2 years above picture). And this time, I predict a maxi-devaluation of 10% – 25% anytime in the coming 2-3 months, beginning this 20th January- a welcome gift to the new president Trump.

 

Predictions

Markets will plunge by 1000 plus points (not correction, as said by analysts).

Major financial institutions will take big and sudden losses.

Emerging markets will take a toll on growth.

World countries may engage in beggar-thy neighbor strategy to support their slowing growth.

05 Jan

Paying for one man’s Insanity

Slingshot is a simple hand powered projectile weapon. The classic form consists of a Y-shaped frame held in the off hand, with two natural-rubber strips attached to the uprights. The other ends of the strips lead back to a pocket that holds the projectile. The dominant hand grasps the pocket and draws it back to the desired extent to provide power for the projectile – up to a full span of the arm with sufficiently long bands, as Wikipedia mentions. We’ll comeback on this story at the end.

slingshot

 

Time line to normalize scraping Rs 500 and Rs 1000 notes were kept every changing and unending date postpone request by Indian Prime Minister Narendra Modi has ended on 30th December 2016. And there seems no ending in lines and cash availability as promised by him, his Finance Minister and the Reserve Bank of India.

 

Still most ATM are either closed or No Service are very common. Cash at banks are is scarce. And we can hardly withdraw Rs10000 or less even when the government and RBI has promised Rs24000 limit per week. Demonetization policy has turned out to be a horrendous act by the Modi and his BJP government to scrap the 2 largest currency denominations of Rs 500 (approximately USD 7) and Rs1000 notes (approximately USD 7).

 

On 31st December, next day of debacle of cleansing of the system, Modi has come up with special schemes to cover up his fiasco by increasing ATM withdrawal limit to Rs4500, and the following schemes were introduced to cheer the middle and lower class to for the upcoming election in 6 states by mid of 2017.

 

  • Housing loans for poor and middle class where interest rates exemption of 4% for loans up to Rs 9 lakhs (Rs 900,000) and 3% for loans up to 12 lakhs (1.2 million).

Don’t know how the government will classify people from which class or section they belong to.

  • Interest waiver for 60 days on loans taken by farmers from district cooperative and primary societies. Its just interest waiver for 60 days, when the farmers have lost 2 cycles of crops due to demonetization.
  • Assistance to pregnant women for Rs 6000 (USD 88) will be transferred to their account.

How and who will make the transfer (which department) and what stage of pregnancy is not made clear.

 

Crumbling the economy singlehandedly

Cell phone manufacturing in the suburbs of New Delhi has from the past 2 years has attracted a hundreds and thousands of workers from the neighboring states. This is mainly part of the ‘Make in India’ campaign started by Modi.

Note ban on 8th November has jolted the industry by cash crunch and curbed the legitimate small enterprise. Many of these industries has slashed production by more than half and a third of workers were let go, due to less demand.

More than 80 million people are employed by unorganized small enterprise including cycle manufacturers, garments manufacturers, weavers, handicrafts etc. Most of these businesses have cut down in production due to slow sales and raising inventory levels had to lay-off the workers due to fewer sales.Even large manufacturers from car, white goods, cell phones have halted the production and employees were given mandate leave.

Even the credit card companies have posted decline in transaction, even when the government created cash shortage is forcing people to use their cards more.

 

India and other economies

For the first time in 100 years, India’s GDP has surpassed United Kingdom reaching USD 2.3 trillion (not because India is growing, but because Britain is slowing, due to brexit). The most recent statistics show the demonetization has resulted in slowing of the Indian economy

. “Ambit Capital, a respected Mumbai-based equity research firm, has officially estimated that the demonetisation-driven cash crunch will result in GDP growth crashing to 0.5% in the second half of financial year 2016-17. This means the GDP growth for six months, from October 2016 to March 2017, could decelerate to 0.5%, down from 6.4% in the previous six months.

Further, Ambit Capital estimates that during the October to December quarter that we are currently in, the GDP growth may contract, thus showing negative growth. This disruption could also crimp GDP growth in 2017-18 to 5.8 % from their earlier estimate of 7.3%.” Let’s not forget that India’s debt-to-GDP stands at 69%.

World major economies are in the grip of a deflation spiral, leaving some emerging economies like China, India, Russia etc in a better situation to anchor the world economy. Digitization of cash and demonetization by Modi has given a death blow to the Indian economy to collapse.

 

Coming back to the slingshot theory, when the economy contracts, politicians and Central Banks do all crazy things to get back the gloomy economy picture. And one of the reasons for banks in India (not central bank- RBI) has reduced loan interest rates by about 0.9% suddenly at the end of the demonetization mockery.

 

“As soon as economic policy becomes painful, clever economists always suggest new unorthodox painless pathways,”- Raghuram Rajan

 

Former RBI governor Raghuram Rajan was to be given the actual credit for reduction of interest rates (base rate) from 8.0% to 6.5% from 2014 to end of December 2016. As the banks did not pass the RBI rate cut, Rajan was forced to implement Marginal Cost of Lending (MCR) from 1st of April 2016. However, the banks were stubborn to pass on the benefit to public.

Its shame on Modi or his government, or the banking sector for taking credit for interest rate cut  from 1st Jan 2017.  Modi thinking that he has shot 2 birds- demonetization (killing black money) and interest rates cut (false economic revival) with one bullet only adds another feather to his fallacy.

With declining GDP, ever-increasing increasing debt,  increasing in unemployment rates and passing Rajan’s interest rate cut to public will splurge the economy with cash will lead to all kinds of unintentional and unimaginable consequences of crime, poverty, higher inflation etc.

 

Cocking the slingshot might take less distance but the projectile travel is far distant (about 10-20times) than the cocking distance. All this is the result of the one man Modi’s insanity.

 

Forecast for 2017

Decrease in interest rates by another 0.5-1%.

Not just slowing, but decrease in India’s GDP.

Fall in stock market 15-25%, analysts say correction but it is not. Stocks are overvalued at current prices.

Increase in inflation, can expect inflation to be between 8-10% or more.

Increase in unemployment at all levels, leading to increase in crime .

 

 

27 Dec

Raising of a Dictator

The difference between a democracy and a dictatorship is that in a democracy you vote first and take orders later; in a dictatorship you don’t have to waste your time voting.  – Charles Bukowski

When you have an efficient government, you have a dictatorship.  – Harry S Truman

We’re on the final week of demonetization  which is supposed to end on 30th Dec 2016 as promised by Prime Minister Modi. Indian economy has been in hibernation mode and was expecting to be cleansed and rejuvenated from black money(tax evaders), fake currency and terrorist activity.

Hardships for people has started soon after PM Modi announcing demonetization on TV on 8th Nov 2016. And everyday news and policy kept changing as per the governments and central banks whims and fancies. Which has caused much trouble to the public just to catch up with the updated rules? No one knows what the current rules are and sometime even the banks are confused. People wonder if Modi know what he really wants.

Ever changing RBI Notifications from 8th Nov 2016

Though the salaried middle class had minimal effect due to education, working in corporate and living in cities, has provided access to banking and alternate channel infrastructure. Therefore, their support to Modi’s demonetization has been intact. These are also the class of people who are the majority of tax payers, with greed and envy over other classes, now expect payback time for other class of people to pay fair amount of taxes. Such thinking of the working middle class has unaffected by currency ban and claimed the moral high ground.

What the salaries middle class forgot to consider that soon or later their jobs will be at risk, due to the domino effect of the harm done to small businesses. The newly lost jobs will turn for alternate source of money, which may lead to increase in poverty, hunger and desperation leading to increase in crime. The suffering of job losses in other class leading towards the middle class in inevitable.

Adding to the woes, conversion of currency has abruptly stopped on 24th Nov 2016 when government realized that it was chaotic and unsustainable. With the end of conversion, 50% of Indian population without bank account are in a situation that their old notes have indeed become toilet paper.

Allies and Opposition parties of current BJP government are waiting for 30th December. If nothing materialistic  as promised by Modi happens by 1st January 2017 it seems likely that Modi will lose his political support. And whatever may be the political situation is, the middle class would realize that they have been fooled by the government.

 

“It’s easier to fool people than to convince them that they have been fooled.” – Mark Twain

 

Modi has delivered a beautiful picture to people travelling and negotiating deals in foreign land. NRI’s have shown strong support. With limited cultural understanding and less self-confidence have made NRI think that the projections of Modi will put India on international map for development and western values, raising confidence in them. What the NRI offer are just virtual support, not because they care for their mother land.

Meanwhile, the current BJP government and Modi are not leaving any stone upturned to get maximum mileage from the flop show of demonetization and totalitarian state in India. Modi and his team has worked hard to bring a big gloomy picture to its people on the positive effects of demonetization by aggressively lobbying Moody’s rating.

Moody’s response- While India’s debt-to-GDP ratio has dropped to 66.7% from 79.5% in 2004-05, interest payments absorb more than a fifth of government revenues. The ratings agency’s concerns about the cost of its debt burden and a banking sector weighed down by $136 billion in bad loans. Moody’s said India’s debt situation was not as rosy as the government maintained and its banks were a cause for concern.  Winning a better credit rating would have been a much needed endorsement of Prime Minister Modi’s economic stewardship on demonetization.

Modi wins time magazine’s person of the year. Time’s ‘Person of the year’ honor, which the US publication bestows every year to the one “who has most influenced the news and our world in the past year, for good or ill”.

If demonetization fails, Modi will lose his political support. Will that lead to democratic election soon? Possibly not. All signs show that Modi is strengthening his position as a de facto autocrat.

 

Truth is stranger than fiction, but it is because Fiction is obliged to stick to possibilities; Truth isn’t. – Mark Twain

20 Dec

Racism and Corruption in DNA

During 1995, India find itself on the world map as one of the biggest economy (G-20) list and stands top in call center and IT industry. With a wide variety of cultures and religions we have a 300 million middle class population. Very fortunate to get a graduate English medium education, music, entertainment, medicine etc from the western world, but very unfortunate that we did failed to see the cornerstone of western civilization really consists of.

When a person is introduced to family, friends the first thing people look at his origin, caste, creed, religion, region, educational background, family status, financial status and many more metrics to let him mingle in the group. This kind of behavior is very common in every Indian household.

Believing such ritualistic religious behavior would fade away with easy access to internet knowledge and information. But irrigational minds and forced beliefs have constrained the growth of critical thinking in Indian people.

Some of my Australian friends have visited India for the first time. After their visit during our first conversation they were very delighted with the experience “saying it was an awesome place to visit. But, we could hardly find any Indian’. I replied WTF?. Yes there were no Indians in India. We could only find Guajarati’s, Muslims, delhiities, Hyderabadi’s but not even a single India.

Virtually all Indians offer and take bribes. Corruption is a very religious custom to Indian and especially to Hindus. Every ritual people offer money and other donations to god to fulfill their wished. This has become a day to day practice in most religious places.

Governments have a separate department- endowments just to administer temple operations and revenue. And it is big fat and profitable business.

Scene like the above are very much common in India. So is the religious mafia business. India is filled with people with cognitive dissonance. All my social media chat has been bombarded with anti-corruption in the first 2 weeks of demonetization. When these people voice their views on corruption, one had to interrogate them further in order to understand what they really mean. After probing these people further, I was able to come to the conclusion that “they want corruption in India to end, with an only exempted person to be themselves”.

19 Dec

Hen lays golden egg a day

 

Well most of us have read this story many times in our lifetime. And most of us even made similar stories to teach our children. The moral of the story is “we lose what you have, if we act in greed”. I am sure, most of you who knew this story will agree with me.

 

But, do you really follow the moral in real life is what I want to question.

 

Capital gains– when an item/asset is purchased for x amount and sold for x+n amount, then the n amount is called profit. Or in tax terms, it is called capital gain. Webster dictionary describes “the increase in value of an asset (as stock or real estate) between the time it is bought and the time it is sold”.

 

For example if you buy an item (say stock/real estate etc) for USD 20 and you sell it after a month for USD Rs 23. The 3 dollar difference is called capital gain.

 

Cash flow– Amount of cash moving in and out of the business. Here, we are considering positive cash flow (income is more than expense). Webster dictionary describes “a flow of cash; especially :  one that provides solvency”.

 

Cash flow is the oxygen of business, the more the cash flow the better a business can grow as the company has liquidity. We can also call it cash cow, as it keeps getting cash every week/month.

 

And capital gains are one time, large sum return on investment, but the asset is sold, the lifetime of it ends. And capital gains are not tax favored. A large percent of tax in implied on tax.

 

Most people and businesses in India prefer Capital Gains more than Cash Flow, as India is a negative-yielding economy. After demonetization, business risk has gone through the roof. Modi told the nation that the cancellation of the currency would protect the interests of “those citizens earning honestly and with hard work.” Modi’s actions are sending probably more than 400,000 people into unemployment while shops have closed as they are unable to collect money or pay workers.

 

 

India soon will become a totalitarian state and likely with the support of most individuals. India as a country exist today as British creation. After 69 years of independence, we’ve less reason to exist in the current form. The glue of reason that the British have applied is flaking, and it is doing so rapidly under the catalyst by name of Narendra Modi.

14 Dec

All Pain No Gain

It was a shocking announcement by Prime Minister Narendra Modi of scraping the largest denomination notes Rs 500 % Rs 1000 notes in India on 8th of November 2016.

India is the 7th largest economy with GDP around 2 trillion dollars. And has second largest population only next to China.

Indian population constitutes of 300 million as middles class with income around Rs 400,000-500,000 per annum and the remaining 1 billion in the low income group with incomes less than Rs200,000 a year.

It’s been more than a month of this announcement, around 86% of circulating currency in the country of 1.3 billion population has been worthless piece of paper. The reason marketed for this was to curb black money from the system, fake currency being circulated and terrorist and moaist activities. But this action packed initiative has been of little success.

And as usual, political elites and big businesses implemented a hair brained policy and the poor left to suffer the worst consequences. The government and central banks may have used India as Guinea pigs in this monetary experiment.

Black Money is Alive and going great.

Government has hoped that a large percentage of black money mainly stored as high demonization notes will never make it into circulation if new currency was introduced.

However, according to the Economic Times, the government is in for a shock:

“The RBI had said that Rs 8.45 lakh crore was deposited and exchanged during 10-27 November, after the implementation of the note ban from 9 November. Between 28 and 30 November, the State Bank of India saw deposits increasing by Rs 22,000 crore. In a recent submission to the Supreme Court, the Attorney General had said that the government expected Rs 10 lakh crore back as deposits. This raises questions whether the exercise was worth carrying out at all.”

 

Counterfeiters

Present and past governments have all blamed the neighboring country mainly Pakistan of smuggling fake currency into the country.

With the new currency notes introduced, Indian citizens have taken up the initiative to print the new currency themselves at home. A shoking case came to light when a young engineering graduate and a beneficiary of Mr. Modi’s ‘Make in India’ program used his skills to print fake Rs. 2000 notes worth Rs. 4.2 mln. Abhinav Verma and his accomplices were not only printing fake Indian currency but also running a racket exchanging old notes for new in the north Indian city of Mohali, Punjab.

The new currency being unfamiliar with the public has made counterfeiters to dabble in the currency exchange business.

 

Terrorists, Maoists and politicians get their hands on new currency

Several terrorists and militants from Jammu Kashmir were reported to have held new Rs2000 denominated currency, less than a fortnight after its release. There are also news of politicians and other businessmen have been caught with huge stacks of this new money.

Curiously, a lot of politicians are from the current ruling party Bhartiya Janata Party (BJP)

 

 A new tune from the Government

After the biggest flop show from the Modi government, they’ve stopped singing in terms of its initial stated benefits. Now the new tune is of the “Cashless Economy”.

Finance Minister Arun Jaitley announced a new benefits to push cash less economy and Modi urge citizens to get mobile and make digital payment. Benefits include paying for fuel, insurance, toll booths, train tickets etc for small discounts.

What was Modi thinking? In a series of separate interviews between November 8 and November 30, Modi said the following:

Over the last three weeks, I have made a strong appeal for increased cashless transactions. Large volumes of liquid cash are a big source of corruption and black money. Today we live in an era of mobile banking and mobile wallets. Ordering food, buying and selling furniture, ordering a taxi…all of this and lot more is possible through your mobiles. Technology has brought speed and convenience in our lives.

I am sure most of you are using cards and e-wallets regularly but I thought I must share with you ways through which increased cashless transactions are possible. Learn how this digital economy works… Learn about card payments and other electronic modes of payment. Look at the malls and see how they function. A cashless economy is secure, it is clean. You have a leadership role to play in taking India towards an increasingly digital economy.

Modi’s statements reveal the hidden agenda of the cashless economies. Demonetization move has nothing to do with tax evasion etc which will continue anyway. This conspiracy of cashless society, small savers are rounded up into digital pens at big banks. They are like lambs led to the slaughter through negative interest rates and asset freezes.

 

Consequences

Foxconn fires 25% of India workers as the sales collapsed by 50% after the demonetization. And the company has cut its production into half.

Sales of Mobile phone and cars have been down by 30 percent.

ATM have been closed or non-functional for weeks.

Retails sales (mon and pop) have been down by 40 plus percent.

 

06 Dec

Demonetization effect

Its 27th Day of demonetization and we still have the problem of withdrawing cash from banks and ATM. Though individuals in cities have been blessed with some cash, due to wide media coverage, but the problem seems to be worse in towns and villages.

 

Though govt. Claims to have 2 lakh plus ATM (where most of the closed, open with no cash or no service sign) and about 1.9 lakh bank branches we still have problem with cash withdrawal. Though the RBI has been marketing a weekly withdrawal limit of Rs 24000 not even 10% of the banks customers were not able to draw that limit and if they even did, it was the newly printed Rs 2000 notes. Which made no sense to draw, as the counter party of the transaction did not have sufficient change.

 

The situation is much worse than we see on television. As the mass media is has become the pet propaganda machine. And our dear Amma’s demise has totally diverted the demonetization news for the last 2 days.

 

We expect things to get worse from 15th of this month as everyone from farmers, laborers, working class, bankers etc are reaching the threshold limits. And once it passes the threshold patience limit, there are going to riots on the streets.

I recommend you to hold sufficient cash (either Rs 2000 or small denominations) as much as possible for the coming catastrophic events. The problem is going to get worse and cash could hardly be available for use.

atm2 

Outside ATM where cash was being dispensed. It was around 9pm.

 

atm-1

ATM have been closed for more than week. Some of the ATM were open with No Service or No Cash sign.

04 Dec

European Crisis

December 4th 2016 is a big day and no one is talking about. It could be said as the day of reckoning of European Union.

First, Italy referendum on the new legislation proposed by Matteo Renzi. Secondly, Austrian presidential elections.

A NO vote to Italy’s new legislation will make Renzi end his political career and a big visible crack in the EU. Exit polls are timed at 10pm local time.

We can already see the unexpected results from the globalists..1. Brexit, 2. Trump winning US presidential elections and 3. Quitaly. This 3rd blow to the globalists will hit hard.

Banca Monte De Paschi is in critical state with its recent stress test, which may fail soon after the NO vote. Which would result in a snowball effect bringing down other local and European banks, then spreading to worldwide crisis.

We live in a well connected system today. And see domino effects very well. We only need to understand how it will effect.

Recent surgical strike on Pakistan by India has made the BSE fall by 700 plus points and NSE by 250-300. Last August, devaluation of Chinese Yuan has resulted in a big fall in dollar value and world wide markets.

We’re just waiting for that one moment to happen when crisis strikes. And when it does, things happen right in front of our eyes and we could no nothing.

Take care and good luck.

 

30 Nov

How much worth is the US Dollar?

United States of America the most powerful country in commerce, business, military and especially a free country market. We all love that country, for the freedom to be whatever we want to be.

However,  are we really talking about the same old America or the present one? I strongly feel we’re still talking about the past. As most of the people still do not have any idea about the present America, and even if they know they don’t bother as they have lost their common sense to propaganda.

At present USA is in 19 Trillion Dollar (the biggest number in a 12 digit calculator is still 1 unit less from 1 trillion) debt and would hit the emotional debt ceiling of 20 trillion.

I believe, this 20 Trillion debt mark would be met even before Obama administration leaves office and Donald Trump takes over. And what next, with Trump’s election promises about heavy investment and development of big infrastructure products. That means, more debt. Where will all this money come from, selling more T-Bills?? Well, that is what they usually do. But, who is interested in buying??

So how do you think this 20Trillion dollar will be paid off? With current scenario, the US Dollar is worth less than toilet paper, except for the people confidence.

http://www.nationaldebtclocks.org/getwidget

30 Nov

Welcome to my blog

Hello

I would like to share my knowledge and understanding about things that matter to you and me the most. I’ve been avid reader and my common sense has never agreed to things that have been happening to me or to be people.
Financial Markets, Education,  is seems very fascinating to me. But I didn’t really understand them (nor many other like me do). Not because they are complex but they are manipulated.

 

I was one of the very few who was awaiting for note ban, especially high denomination. However, I didn’t expect that the Indian Govt and the RBI has made a provision for exchange too (though to a limit).

Most of my predictions have come true. And I would possibly say about 70% true.
Some of them are below…

1. Ban on large denomination note- Rs 500 and Rs 1000. (True).
Rs 500 & 1000 denominations are scrapped. But Govt. would release new notes in Rs 500 & 2000 denominations.

2. Crisis event like this will happen over weekend or holiday time, most probably on Fri (Sat and Sun holiday) or Sat (sun and may be Mon holiday). (Partly true).
Happened on Tuesday 8 Nov 2016. And Govt. declared holiday on Wednesday 9 Nov 12016.

3. ATM will stop dispensing cash. (True)
By the night of 8 Nov 2016, people lined up in front of ATM to withdraw as Govt (also) mentioned about ATM will not be functional after midnight till 12th Nov 2016.

4. Hike in precious metals (true).
Prices of precious metal like Gold Silver have been hiked by 20-40% in most of the places. Especially they we sold for high price from Oct 8-12 and so on.

5. Crash in Real Estate prices. (True)
RE Markets and transaction have crashed a bit. Will show the effect in few more days. Currently all mid-deals have been on hold indefinitely till some alternate solutions appear.

6. Inflation (purchase power) of currency will be lowered. (True)
Prices of good have increased due no non-availability of smaller denomination notes. People are forced to spend Rs 500 (if some biz accepts).

 

Good luck.