Friday, 2 December 2016

Vegetable farmers, first victim of demonetization driven deflation

Vegetable farmers are the first victims of demonetization resulting in cash deprivation consequently destroyed the markets deflating its prices due to disturbance in demand supply mechanisms because it is entirely cash driven. Only metro cities vegetable markets survived because of some availability of cash to support these markets.

Already, real estate, cinema production and construction workers are work less or job less since a month. When the work will resume and how many will get back their jobs is a mystery. Informal sector dependent casual workers, many are is disarray without work and income.

In coming days/weeks many more stories will get unfolded, the innocent victims of mindless Modinomics.

My View:
Demonetization is a well known mechanism used in many countries for tackling corruption, black money & fake money. Secrecy is important for getting good results but without proper preparation and mechanism to replenish cash into system with minimum pain to people of the country is nothing but audacity and insanity and reflects hidden objectives rather than sincerity of the purpose.

Modi, with just on hand 20% replacement cash printed in worthless Rs.2000 denominations and failing to foresee the necessity of re-calibrating ATMs to dispense the new currency notes has resulted in 86% cash sucked out and printing new notes & replenishing is at least 2-6 months away, has just botched up Indian monetary system and if it does't collapse he should thank his stars.

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