Naidu has been a robust advocate of banning all large-cost notes to prevent Black money for decades, even before the demonetization.
Relatively, Finance minister Nirmala Sitharaman, the other day, gave a declaration that the government is prioritizing the small denomination notes. This is while asked approximately the destiny of the 500. Be aware at a seminar.
After the finance minister's declaration, there are speculations that Chandrababu Naidu, the kingmaker inside the present-day authorities, may not have given that announcement with no insider information.
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So what happens to the black money if the bigger denomination notes are flushed out?
It's miles impractical to save Black money in bundles of 100s and 200s. So, where is that money going to be parked?
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In India, there may be no election without Black cash.
Politicians spend Black money inside the elections and earn the equal after the elections. So, black cash is a crucial part of the indian system and may be very tough to dispose of.
So, they may without a doubt search for alternatives.
Real property is usually a secure haven for parking Black money. But then, real estate belongings are not smooth to transact and are underneath the consistent vigil of the authorities.
Additionally, the government fee for land is usually less than the market cost because of this high danger.
So the next secure parking vicinity is going to be Gold.
It is easy to hoard Black cash in Gold. It is even better than hoarding bundles of cash in 500s. Although it is a bit tough to transact, it's still far higher than actual property.
So, gold will shoot through the roof if the 500 observations are proven to be the door from the device.
Already, gold is buying and selling at reported highs. The ten-gram 24K gold almost touched one lakh, and so, it could become unaffordable to the middle class if the authorities ban the 500 rupee. Be aware.
In keeping with a survey, consumption of gold in indian families is the best among most of the middle-profit organizations (people with annual earnings between Rs 2 lakh and Rs 10 lakh). They consume a median of fifty-six percent of the whole extent of the yellow metal sold inside the USA in the last 5 years.
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