Friday, February 24, 2017

Notebandi 2.0

Re-posting from
https://orders.equitymaster.com/VKL-NB-80RF/E860T419/index.htm?pageNumber=2

I've been reading this author's newsletters and am finding this India-based source very good at big picture economic insights -- which for the first time I'm seeing being applied to the Indian scenario. If this was in the west it would have the "alt-right" label pinned on it. I'm seeing that starting from the individual-economic-freedom perspective rather than the more left-leaning collectivist / welfare-state perspective, there's new insights coming.

This page is initially about his upcoming book, but so much good information is shared here itself, so i'm capturing it. I especially liked the listing down of all the taxpayer-funded largesses by the government. Most shocking was the detail about the photo film company. Also helpful was the sharing of cases from other countries.

So check it out!





Notebandi 2.0

One Of The Most Outspoken Voices Against Notebandi 1.0 
Now Makes A Controversial Prediction!

"It's Coming…I Am Convinced." - Vivek Kaul

Dear Reader,
I need your complete attention for the next eleven minutes.
What I'm going to share with you today, could potentially impact your immediate future...
In a BIG way.
  • It could leave you running from pillar to post trying to prove the legitimacy of your hard-earned money...
  • It could lead you back to the long ATM queues...
  • It could change how you save, invest, and earn...
  • It could impact your job, your business...your way of life!
  • And it could even bring the tax man knocking on your door...
Because this time...
It could be a lot worse.
You see, my research shows that there could be a Notebandi 2.0 around the corner.
It could happen tomorrow, next month, next year...I can't say for sure.
But here's the thing...
I am convinced it's coming.
Here's why...
You see, I've identified an irreversible trend that is going to force our government into taking this step.
A trend that began all the way back during Nehru's days...
And ever since, it has grown stronger with every passing decade.
And today it stands at a point of no return.
A point which I believe could be...The Crisis Point.
In fact, I'll just show you how this irreversible trend could actually be the real reason behind Notebandi 1.0 as well.
And I'll prove it to you that this irreversible trend could lead to Notebandi 2.0.
However, make no mistake... Notebandi 2.0 will be worse.
And it could impact you.
Hard.
And the fact that you don't have any black money...will not spare you.
The government has come after our money once...
And we both know that they failed.
So, this time...

Notebandi 2.0
Not Just Cash, The Government Could 
Come After Every Asset You Own

Yes, for Notebandi 1.0...
The government came for your cash...and failed.
So, I believe, for Notebandi 2.0... it might not be cash.
  • It could be your property...
  • It could be your gold....
  • It could be your jewelry...
Yes, in my view, "Notebandi 2.0" is not just about 'demonetisation' of paper money...
  • Notebandi 2.0 will be any decision taken by the government through which it can confiscate your wealth (cash, gold, silver, property, or anything else) and which will be enforced on to the citizens of the country.
So, for Notebandi 2.0...
The government could come after everything you own.
And because Notebandi 1.0 failed, it's almost certain that when they come next time...
It would be with more force...more intrusiveness...and harder hitting...
  • Imagine a scenario where your hard-earned wealth is suddenly not available to you...
  • Imagine having to dig out document after document to prove that the wealth you own is actually yours...
  • Imagine the government coming after you...
Yes, I know this sounds scary...
After all, it is.
And, the most frightening of them all...
Imagine having to deal with the Taxman even though you've paid all your taxes.
Yes, dear reader, it could get as bad as this.
And that's why I want you to be prepared...
Prepared for Notebandi 2.0.
Because, it could happen sooner than you can imagine...

The Government Has Already Started
Taking Steps Towards Notebandi 2.0

Now, you might not be aware of this...
But in the recent budget, there was a 'small and hidden' section that I believe could be the government's first step towards Notebandi 2.0.
While everyone thought that this was balanced budget, with some tax-respite...
Most would've missed this small hidden proposed tax-amendment that could have a huge impact on your life.
The proposal is to amend Section 132 of the Income Tax (IT) Act.
Now, I am not a tax expert. However, after reading through the amendment and speaking with people who are experts in this domain...
Here's how I see the amendment...
It's a proposal, which gives the Income Tax officials full-right to...
  • Enter and search your house, office, or shop...without giving any reason.
  • Seize your gold, silver, jewelry, cash, or other valuable articles...without giving any reason.
  • Scan your book of accounts, other documents, and even take copies... without giving any reason.
The IT officials could come knocking on your door to 'search and seize' your wealth...
WITHOUT giving any reason.
Yes, earlier, the IT Department had to prove that they had 'reason to believe' you were hiding your wealth.
But now, under this proposed amendment, they have been given full right to scrutinise, and in my view – harass, anyone and everyone they want...
Without having to disclose why they had "reason to believe" that any violation existed.
If you ask me, I believe this is as intrusive as a government can get.
There are people who are already raising their voices against this bill...
  • As Baijayant 'Jay' Panda, a member of Lok Sabha from Biju Janata Dal, wrote in a column in The Times of India...
  • "Permitting taxmen to conduct raids without due process will be disastrous."
  • Or as was published in Business Standard...
  • "If assessment officers declare they have reason to believe, or suspect, that an assessee is concealing assets, then they can order a search operation. If the Bill succeeds in amending the Income Tax Act, then this decision will be beyond review. This would have an unfortunate effect on the nature of tax administration in the country, and only increase fear of arbitrary behaviour."
Now, we both know how this authority could be abused.
IT officials could easily coerce people with a threat of 'IT Raid'...
And if the government does start coming after your money, gold, silver, jewelry, cash, and more...that will be the beginning of Notebandi 2.0.
So, with this proposal, the government has already taken the first step in that direction.
However, even though that could be the first big step towards Notebandi 2.0, it doesn't mean that the government hasn't been doing anything over the years...
The situation, for the honest common citizen, has been worsening with each passing year...

Have You Realised That You're Paying
Higher Tax With Each Passing Year?

Yes, the issue is that we don't realise small incremental changes...
Our government adds a small cess...increase the sales tax by a small percentage...
And most of us just ignore it.
However, over time, these 'small changes' become a 'big source' of money for the government and 'big hole' in your pocket.
In fact, take a look at this:
  • In 2002...the service tax rate was just 5% and on just 52 defined services.
  • By 2010...the effective service tax rate more than doubled to 10.3% and covered 119 services.
  • And in 2016...the effective service tax that you paid was at 15% and covered ALL services.
As you can see...
Your tax contributions are going up year after year...
Even if you pay income tax, the service tax rate you pay has TRIPLED since 2002 PLUS, you're paying for more and more services.
And here's what makes the matter worse...
Once GST is implemented, the service tax rate could go as high as 18% or by some estimates even 20%.
Now, it might sound scary...
But these are the times we live in.
However, as my valued reader, you don't need to worry about Notebandi 2.0.
All you need to do is to know about all the ways the government could come after your money...and be prepared.
And even on that front...

I've Already Done 
All The Work For You

Yes, I have been tracking Notebandi 1.0 closely...
In fact, recently, I even released a Special Report – Demonetisation: The Good. The Bad. The Ugly.
And more than 16,800 copies have already been downloaded, so far.
However, that was just the first step...
Today, I have decided to share All My Private Research
with you through an Exclusive Hardbound Book
  • Yes, over the last several months, even before Notebandi 1.0 hit you, I have been working on an Exclusive Book that reveals full details of this irreversible trend...And how it's already hurting you.
Even in ways you may not have even recognise as yet...
And I have decided to send a hardbound copy of my latest book, which reveals full details on this irreversible trend, to you...Virtually Free.
Yes, initial copies of the book have just started rolling off the printing press...
And I urge you to grab your copy right away.
Before it's too late.
Because, for the first print, I have just 1,000 hardbound books available.
Here's one more thing: This Book Is Not Available On The Stands, Bookstores Or Amazon.
The only way to get your copy today is to claim it here.
Plus, the best part is that you can claim it Virtually Free.
However, you do need to claim it before we run out of stock...
And with more than 130,000 readers of The Diary, I believe we will run out of stock very soon.
But if you act today, I will dispatch your hardbound copy next working day itself... straight to your doorstep...anywhere in India...
Now, before I show you how you can reserve your copy...
Let me introduce myself...

Hi, I Am Vivek Kaul...

Vivek Kaul - EditorFor over a decade now, I have been writing about issues that could impact people like you and me.
Issues which are critical and yet, no one in the mainstream media wants to talk about them.
Maybe it's because they don't want you to know the truth....
Maybe it's something that their advertisers don't want you to know...
Maybe it's just they want to remain in the good books of the government...
I don't know.
But I can tell you this...
Since I joined hands with Equitymaster, I've made it my mission to write about these issues in even more detail...and be the honest and unbiased voice amidst all the noise.
  • It's what prompted me to write to you about collapsing public sector banks...
  • It's what prompted me to raise questions about India's 'demographic dividend' and how it could easily become a 'demographic disaster' if we don't create jobs...
  • It's what prompted me to call the real estate bubble a bubble...
  • It's what prompted me to begin my recent petition against Black Money in Politics...
  • And it's what prompted me today, to write about Notebandi 2.0...
Because, while everyone wants you to believe that it's all over...
I believe that the worst is yet to come.
But we'll come to that in a bit...
Before we proceed, let me make it extremely clear that I am not the one to sugar-coat my views.
So, what you might read below, could be disturbing...
In fact, I have even received numerous emails from people who do not want to know the harsh truth and want to stay in their dream world.
For example, recently, I received a message from a reader saying that the world has moved on from Notebandi and I should move on as well...
Now, the trouble with that approach is that I cannot keep changing the story depending on what's 'selling' in the market.
When I pick up a project, I prefer to do an in-depth analysis and to track the story to its rightful end.
And the data on the negative effects of Notebandi 1.0 has just started coming out and a lot more could be released in coming few months.
So, now is one of the most important times to analyse Notebandi 1.0 and prepare for Notebandi 2.0.
And if you, dear reader, are not the kind who can handle harsh truth...
I thank you for your time... and you can stop reading hereon.
Because, I'm not afraid to say what I believe needs to be heard.
My views and opinions are not influenced by advertisers...
My views are based on solid research, hard facts, and concrete statistics...
And it's something that I've done my whole life -  call a spade, a spade.
Even when I was writing for The Economic Times, DNA, Firstpost, Rediff, BBC.com...or any of the numerous other publications.
My goal has always been to bring the real picture to my readers.
In fact, I believe that is why I have also been invited to give lectures at several
B-Schools like IIM Bangalore, IIM Indore, IIM Kozhikode, IIM Visakhapatnam...etc.

In fact, my love for uncovering the real story behind the evolution of money led me into writing a 3-Book Series called Easy Money Trilogy.
This trilogy went on to be featured on Amazon India's Bestsellers List...

Now, I'm not bragging here...
But this support is what prompted me to write my New Book which I'll be happy to send right to your doorstep...virtually free.
Because what I have today...needs to be heard.
Rather, this could be my biggest (and possibly the most controversial) revelation till date.
It's about an irreversible trend that was behind Notebandi 1.0...
A trend that, as far as I know, no one is even talking about...yet.
And a trend that could lead to Notebandi 2.0...
Now, we don't know when exactly it will happen...but I am certain that it's coming.
In fact, because it's an irreversible trend... makes it even more important that you act immediately.
So, with no further ado, allow me to reveal...

The Irreversible Trend
The Reason Why The Government 
Will Keep Coming After You

Now, let me tell you that this trend was set in motion decades ago...
As per my research, it's something that began all the way back during the days of Jawaharlal Nehru.
It was further entrenched into our system during the days of Indira Gandhi...
And, over the years, the roots of this trend became so deeply rooted into our system, that it's almost impossible to correct it now.
And I'll show you how Notebandi 1.0 could be a direct result of this trend.
And how it could lead to Notebandi 2.0 as well.
But first, let's understand what this irreversible trend is...
I've found that the irreversible trend is our government spending more and more money each year...spending beyond its means.
It's about the government growing bigger and bigger with each passing year...
And it's about the government coming after your money...again...and again....and again.
In fact, let me show you three indicators which prove that we have a Big Government....
Big Government Indicator #1: Take for instance the number of public sector enterprises (also referred to as public sector units or PSUs) it runs...
Year
1951India had Five Public Sector Enterprises
1985India had Two Hundred Public Sector Enterprises
1992India had Two Hundred Thirty-Seven Public Sector Enterprises
2015India had Two Hundred Ninety-Eight Public Sector Enterprises
As you can see, right from our independence, the number of public sector companies, which are companies owned and operated by the government, has risen sharply.
And it's not like these are solid businesses.
There are billions lost each year in these loss-making Public Sector companies...
And yet, they continue to stay 'in business'.
Big Government Indicator #2: the amount of your money that the Government spends on schemes which don't benefit the common man but could actually end up benefitting the Babus...
Now, creating new schemes to waste even more of your money, seems to be this government's favourite pass-time.
It allows you to make big promises...
Give long speeches...
Allocate huge funds...
And then, when it comes to execution, almost all of it leaks out through corruption instead of reaching the common man.
Yet again, this is not a new thing.
We've seen more and more schemes being launched almost every year...since our independence.
And today, there are 950 Central Government Schemes wasting your hard-earned money.
So, with each passing year, our government grew Bigger... the number of schemes it came out with, grew bigger...and the amount of money wasted grew bigger.
Billions of tax payers' money are allocated to these schemes in the name of public welfare...
But, as I'll show you in a bit, all it does is fill the pockets of Babus and their cronies.
Before I come to that, let's look at...
Big Government Indicator #3:
Now, this indicator, like the others I have spoken of, does not have a direct impact on government's spending.
It is a perfect example of how our government has been growing bigger and bigger over the years and thus, just to sustain itself, would need more and more money.
The third indicator is the government's archaic Labour Laws and how they are more of a hindrance in India's growth story...
Estimates suggest that there are almost 200 labour laws created by our government.
Yes, 200...no typo here.
And, along with many other regulations, these are so complex that an average Indian firm begins small and continues to remain small. (Yes, an average Indian firm employs just 2.2 individuals.)
Take this a step forward and you come to the conclusion that one of the reasons business does not flourish in India is such draconian laws.
And as you know, stifled business means stifled tax collections.
So, the government needs money to implement these laws...
And it needs even more because these laws are stifling tax collections.
A perfectly terrible situation.
Now, these are just 3 indicators that explain why the government will have to keep coming back for more and more money from you.
There are numerous other decisions taken by the government which waste your money...
And over the next few pages, I'll show you how it has been going up over the years...and why, according to me, it could force our government to go for Notebandi 2.0.
However, for now, by all metrics, this is what I call A BIG GOVERNMENT.
A government that is already huge and is getting bigger.
But the question you might ask is...
So what?
Well, this is where the problem arises...
And this is why I believe we'll have Notebandi 2.0...
Let me show you by example.
As we saw, the first Big government indicator was the high number of loss-making PSUs...
But did you know that just last year, there was...

A Rs 21.64 Billion Gift Given
To An Inept And Obsolete Company
...From Your Tax Contributions

Yes, I know it's hard to believe...
But this company still makes photo films.
Or at least runs a business that is supposed to make photo films.
Even while the world moved to digital cameras and mobile cameras...
This government continued to throw your money in a business that's supposed tomanufacture photo films.
As expected, this business lost Rs 21.64 billion in just 2014-15.
And it's not just one-year...
Just take a look at the losses this business has racked up over the years...
man-with-money
That's a total loss of Rs 124.32 Billion in Just 10 years.
Do you think any private company could've survived this kind of loss for over 10 years?
Can you even imagine such wasteful expenditure anywhere else?
Would ANYONE recommend running a business that's losing more than Rs 20 Billion in a year and has its sales under 50 million?
NO.
Yet, this government continues to keep it alive...
Because Your Tax Contributions Pay For It.
And before you say that these PSUs at least give jobs to people...
As on 31st March, 2015, this photo company had a workforce of just 348 people.
Does it make absolutely any sense to incur a loss of Rs 21.64 billion to provide jobs for 348 people?
In fact, this company was declared sick by the Board for Industrial and Financial Reconstruction (BIFR) in 1996.
And still, even after two decades of having been declared sick, our government continues to pump in more and more money into it.
What makes the matter worse is that this not an exception...
Honest taxpayers like you are paying to run businesses that were supposed to produce bicycles, fertilizers, condoms, scooters, salt...and more.
So, the questions we need to ask is this...
  • Why does the government need to manufacture all this?
  • Why not just sell these companies to private owners who could actually run it profitably?
  • Why waste Billions and Trillions of rupees in running PSUs that generate such huge losses?
Did you know in just 2014-15, the money destroyed by loss-making PSUs stood at a whopping Rs 273.6 Billion.
The budget allocation for this government's Smart City plan for that year (2014-15) was Rs 70.6 Billion...and the losses incurred by loss-making PSUs was Rs 273.6 Billion.

Imagine how many more cities could've been given a better infrastructure...if only our government stopped wanting control over so many loss-making businesses.
So, with all this wastage, when the government starts running out of money, what do you think it'll do?
Notebandi 2.0 of course.
But wait, let me show you more...
Our second Big Government indicator was the ridiculous number of government run schemes and policies...

A Rs 480 Billion Gift
To One Of The Most Corrupt Schemes
...From Your Tax Contributions

Now, this is another Big Government approach to things...
Instead of ironing out the leakages in our system that add to corruption, we keep hearing new schemes and slogans.
And it's not like this government isn't aware of these 'leakages'.
Almost 30 years back Rajiv Gandhi pointed out that out of every Re 1 allocated for common man by our Big Government only 17 Paise actually reached him.
So, this government already knows that 83% of the tax-payer's money, that is thrown into these Schemes, is going in the pockets of Babus and their cronies.
Yet, we keep hearing more and more money being allocated to these 'schemes for common man' by this Big Government.
In my book, you'll get full details on numerous such loss-making schemes where your tax contributions are being wasted...
But right now, I would like to bring your attention to what Surjit Bhalla, a senior analyst and economist, called The Fourth Most Corrupt Institution In The World, after FIFA, BCCI and PDS (Public Distribution System).
Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS).
A scheme that was launched in 2005 (then known as NREGS) that had the mandate to provide at least 100 days of guaranteed work, every year, to adults of every rural household who are willing to do unskilled manual work.
An excellent initiative...right?
But the ground reality is that at each stage of execution, there's a 'leakage'...
In other words, people 'stealing' from the system.
  • Officials 'steal' from the system by over-reporting workforce and workhours
  • Officials 'steal' from the system by not passing on the benefits to workers
  • Officials 'steal' from the system because few workers actually complain
And yet, instead of working on putting a plug on this stealing...
In 2016-17 Budget, this government allocated another Rs 480 billion.
The highest allocation ever, in one of the most corrupt institutions (ever?).
Adding to what I call the Funnel of Corruption.
A 'Funnel' because a lot of tax-payers' money is being thrown from the top...
But this 'Funnel' has multiple layers.
And at each layer, there's a 'leakage'.
And by the time we reach the bottom of the funnel, there's almost nothing left!
So, our government decides that it needs MORE money to throw in from the top...
With all this wastage, when the government needs more money, what do you think it'll do?
Notebandi 2.0 of course.
And then there's our 3rd indicator...
Our draconian labour laws...
Laws which force the small players to remain small...
But the government which made the 200 laws to harass you, also made other moves...

A Rs 250 Billion Gift
To India's Crony Capitalists
...From Your Tax Contributions

In 2014-15...the government gave Rs 250 billion to public sector banks for recapitalisation.
2015-16...the government gave ANOTHER Rs 250 billion.
And in the next year's budget, Arun Jaitley announced to give another Rs 100 billion!
In fact, from 2009-10 to Nov 2016, the government spent more than Rs 1.25 trillion in recapitalising public sector banks.
That's 1.25 TRILLION rupees...and counting!
And if you're wondering where's all this money coming from...of course, from your tax contributions.

"The government also suffers from a 'principal-agent' problem. Its functionaries (legislators, bureaucrats) may pursue their own agendas rather than act in public interest. They may shirk their duties or feather their own nests. They may make deals that benefit special-interest groups at the expense of the general good." 
Vijay Joshi in his book "India's Long Road —The Search for Prosperity"
In case you are wondering why all this money is being pumped into these banks...well, a large reason for that is the bad loans these banks have racked up.
Loans given by public sector banks which cannot be repaid. 
Now one could argue that some of these loans went bad for other reasons...
But a bulk of these loans went bad because the corporates, which the banks had lent money to, decided to default on them.
In fact, the situation is so bad that many corporates which got these loans are now in the 'stressed companies' bracket. In other words, the profit that they make, even before paying tax, is less than the interest they need to pay on their loans.
If these companies aren't earning enough to even pay interest on their loans...do you think they could pay back the principle...ever?
  • And almost 40% of the loans given out by Indian banks are to companies which are now stressed.
To make the matters worse...
Even within these stressed companies...there seem to be some 'favourites'.
  • A mere 50 companies account for 71 per cent of the loans owed by the stressed companies. (owing Rs 20,000 crores each, on average)
  • The top 10 companies on an average owe Rs 40,000 crore each.
As I have revealed in my book, with examples, a large chunk of these bad loans are because the loans were not given on merit but maybe given out to appease the political masters.
Or for still other reasons.
But the undeniable fact is that a large part of these loans were given out to people who were in the end not able to repay them.
And that's what happens when governments run banks.
Even as the losses continue to grow., the government keeps recapitalising them using taxpayer's money. And as we saw, we have already reached a stage where the government has pumped in more than Rs 1.25 Trillion.
In fact, Finance Minister Arun Jaitley said in his February 2016 budget speech:
  • "If additional capital is required by these Banks, we will find the resources for doing so. We stand solidly behind these Banks."
This was Jaitley's way of saying that the government would do whatever it takes to keep these banks going. So we haven't seen the last of these bank bailouts.
All we'll see are new jargons and new ways to 'PACKAGE' this wastage...
In fact,  one of the recent jargons created to hide the huge wastage of tax payer's money on Bank Bailouts is 'technical write-offs'.
As KC Chakrabarty (Former Reserve Bank Deputy Governor) said...
  • "There's nothing like technical write-off. It's non-transparent and it's without any policy...
  • Technical write-off creates non-transparency, destroys the credit risk management system and brings all types of wrong-doings into the system...
  • You're writing off public money. It's a scandal."
So, while the small businesses are forced to remain small through complex labour laws...
The big players are thriving on your tax contributions.
But here's where it gets tricky...
Someone has to cover the bank's loss.
And who else but you and other tax payers have to pay up.
Like I said just in the last five odd years, Rs 1.25 trillion have been wasted in trying to plug this gap, which will keep recurring.
Imagine...Rs 1.25 trillion...
  • This money could have been utilised to build 10,416 kilometers of highways... (Based on NHAI's cost estimate of Rs 120 million per km.
  • In bringing water and electricity to thousands of villages...
  • Or maybe improving the quality of education in India...
However, it's 'wasted' in keeping the government's banks alive...which further keep the crony capitalists alive...
In fact, during my research I found a study done by the newly appointed RBI Deputy Governor, Viral Acharya, that said...
As global regulatory standards evolve, the government would need to spend an estimated Rs 10 Trillion to recapitalise the public sector banks, by 2019.
Where is this money going to come from?
From YOUR Tax Contributions.
And we both know how well these resources are utilised.
Each year the non-performing assets (Bad debts) of these banks keep going up...
In fact, as revealed by K C Chakrabarty in one of his recent interviews...
  • "Now over Rs 6,00,000 crore is the NPA now. If you include Rs 4,00,000 crore write-off, then I will say Rs 10 lakh crore is the real NPA. Public money has gone. To whom it has gone, nobody knows."
So, almost Rs 10 TRILLION of tax payers' money has already been wasted by the government run banks...and we might need another Rs 10 TRILLION by 2019.
If that number doesn't give you sleepless nights...
'Referring to Vivek Kaul's article[s], I would like to say only one thing...India is a sleeping nation.'
-  Mahesh R.
I think you're living in denial.
Because these government-run banks keep giving out loans to crony capitalists who can't even repay the loan amount...
And yet, this government continues to throw-in more and more money into these cash-guzzlers.
So, with TRILLIONS of rupees wasted through these government banks, when the government starts running out of money, what do you think it'll do?
Notebandi 2.0 of course.
So, where do you think the money will come from?
This time, I Want YOU to answer this question.
In fact, what I have shared with you is just the tip of the iceberg.
There's an even bigger trouble with India's PDS (Public Distribution System).
And I would recommend that you read that in full detail, in my book under chapter number 12.
But as I am sure you'll agree by now, the trouble runs deep...
And it actually shows why our government came after our money through Notebandi 1.0.
So, the harsh truth is...

Your Money Is Under Threat...

You see, there's a reason why I am telling you all this...
The fact that trillions of rupees are being literally wasted year after year cannot be without consequences.
And the ONLY significant source of income for the Big Government is your money.
Whether it's going through direct tax...
Indirect Tax...
Cess...
Or, as I believe...Notebandi 2.0.
The Government Needs Your Money.
In fact, it cannot sustain itself without taking more and more money from the citizens.
The system has been growing for decades now and has now reached a point of no return.
  • The government is not able to get out of loss-making PSUs
  • The government is not able to cut down on wasteful expenditure
  • The government is not able to collect income tax from almost 98% of the population
And the resounding question remains...
Where will the Big Government get the money from?
Quoting Arun Jaitley from his February 1, 2017, Budget Speech...
"We are largely a tax non-compliant society."
Now, they are not able to tax agricultural income...
Nor find out the where the 'black money' is actually hidden...
So, who do they go after?
All the burden of these growing demands will fall on you and the limited number of taxpayers in this country.
Because, we know that they cannot get this money through conventional methods.
And with Notebandi 1.0, we've already seen how desperate our Big Government could get...
And that's why I believe we're bound to see Notebandi 2.0.
Now, as I said before, I can't say when it will happen...
Maybe it will happen next month...
Maybe next year....
However, it's coming... I'm convinced.
In fact, let me show why I believe that this is now an irreversible trend.
And I'll also tell you exactly what you need to do to prepare yourself for Notebandi 2.0.
But before I can show you that, you need to understand...
How did it all start?
How did this government come around to the idea that it has to get involved with virtually everything?

The 'Rot' Runs Deep...
Making It An 'Irreversible' Trend

Now this is something that no one wants to talk about.
After all, it's about one of the most iconic politicians of our country.
However, as I said, even if the truth is bitter...it's still the truth.
And thus, something I am not afraid to reveal.
So, yes it all began decades ago...
India's first prime minister, Jawaharlal Nehru was completely in love with the idea ofsocialism.
"One mistake early Indian policymakers made was to try to micromanage the economy. While it is true that the government needs to attend to a range of policies, from shipping to the quality of education in villages, to managing the nation's international economic relations, it is imperative to realise that it is not feasible for the government to attend to all the varied and layered needs of society with equal diligence."
Kaushik Basu, in his book - An Economist in the Real World - The Art of Policymaking in India
A policy that required that the means of production, distribution, and exchange should be owned or regulated by the community as a whole...
So, he wanted the government to effectively do everything.
Thus, the public sector, or the Big Government owned companies, became more and more important as our economy evolved.
And then, his daughter, and Prime Minister, Indira Gandhi carried on with the legacy and made the problem even bigger.
You've already seen how it got worse with each passing decade...
Over the years, public sector companies went from five in 1951 to almost 300.
And these companies operate across industries...
In other words, our government became Bigger and Bigger with each passing year...wanting to control more and more!
In fact, this is the situation we're in today...
The Top Five Wealth-Destroying 
Government Companies For 2014-2015
Losses
Wealth Destroyer #1Bharat Sanchar Nigam Ltd.Rs 82.34 Billion
Wealth Destroyer #2Air India Ltd.Rs 58.60 Billion
Wealth Destroyer #3Mahanagar Telephone Nigam Ltd.Rs 28.93 Billion
Wealth Destroyer #4Hindustan Photo films & Mfg. Company Ltd.Rs 21.64 Billion
Wealth Destroyer #5Mangalore Refinery & Petrochemicals Ltd.Rs 17.12 Billion
Total Losses of all Loss-Making Government CompaniesRs 273.6 Billion
Source: Public Sector Enterprises Survey, 2014-2015.
So, a socialist approach that began right after our independence...
Added a liability of Rs 273.6 billion to our nation in just one year.
So, as you can see...
It's a problem that has been growing over the years.
And sadly, there's no immediate solution either.
The bitter truth is...the Government is getting Bigger with each passing year.

Why Should You Pay Higher Tax When 
There Are Loss-Making PSUs Like
BSNL, MTNL & Air India?

Together these three accounted for Rs 169.87 Billion in just one year.
That's 169.87 BILLION rupees in losses...over just 1 year.
Does our government actually believe that they can turn around these businesses?
If it wasn't for tax payers' money, would any of these businesses survive?

"The last quarter century's experience has shown that when the private sector is asked to provide telecom services, run airlines and airports, build and run ports, undertake banking, distribute electricity and even undertake water supply, the result is usually (though not always, for there is no shortage of private banks and airlines that have failed) a substantial improvement on what the government was doing until then".
T N Ninan in his book "Turn of The Tortoise"
And do you think this is the best use of available resources?
If you ask me, I think this is actually criminal.
And we both know that the money that goes towards ensuring companies like Air India, BSNL and MTNL running is taken away from other things, like education, healthcare and agriculture.
Each year, we lose billions of rupees in these companies... And yet, this government decides to increase the surcharge on honest tax paying citizens?
Yes, there's an additional 10% surcharge on individual income above Rs 5 million.
So, on one end this government is willing to bear a loss of Rs 169.87 billion every year in these inept companies...
And still, it'll take higher tax from law-abiding citizens like you.
And it's not just direct tax...
When the 'beautifully packaged' GST is implemented...it'll take the service tax all the way up to 18%.
It's yet another way the government is coming after your money.
And of course, there's always a possibility of new cess...After all, multiple cesses have been introduced over the past few years.
So, the question we need to ask is...
Why should we suffer if the government cannot take tough decisions like shutting off loss-making companies?
And make no mistake, we are suffering...

I Believe That We're 
Already At A CRISIS POINT

The question is not "if" but "when".
As I said before...
It's an irreversible trend that we've seen grow over the decades.
Now, we're at a stage where a government cannot stop spending money.
And, as we saw, it's spending way beyond its means...
The question we need to be asking is...where will the money come from?
And the answer, in my view, is Notebandi 2.0.
It could be by effectively confiscating your cash savings like they did in Notebandi 1.0...
Or, it could be by taking over your property...
I can't say for sure.
But the bottom line remains...the government will need more money to survive.
What makes this a Crisis Point for all of us is that they are not able to correct the 'mistakes' they made by trying to follow the socialist approach either.
And the ONLY way they know is to keep coming after your money one way or the other...
Whether it's through additional tax, higher cess, GST (that'll translate into a higher Service Tax),...or Notebandi 2.0.
The government needs money to survive.
And we've seen it happen in the very recent past...
  • In 2013, Cyprus in Europe was hit with a financial crisis.
    What did their Big Government do?
    After a bank holiday, the government froze all online transactions, and decided to levy a flat 10% 'tax' on all the money that the common citizens of the country had saved in the banks.
    Plus, they also increased the corporation tax by 2.5%...
    So, the common citizens of Cyprus had to pay out of their hard-earned money to save the banking system.
    Sounds unbelievable...right?
    But as I said, we've seen it happen in the past.
  • Next, Greece in 2010.
    The debt-crisis led to a situation where the government just ran out of money.
    What did their Big Government do?
    The government enacted 12 rounds of tax increases between 2010-2016...
    And banks were closed with ATM withdrawal limit set to just 60 Euros a day.
    So, yet again, the citizens of the country paid the price because of the decisions taken by their Big Government.
    As I said, we've seen it happen in the past.
Now, I know India is not as weak an economy as Cyprus or Greece...
However, looking at the trillions of rupees being wasted in PSUs and government schemes.
These are examples we just can't ignore.
We saw how desperate our government could get during Notebandi 1.0.
And my research shows, that they'll need to come back with Notebandi 2.0...
Whether it happens tomorrow.... Next month... or next year...
I am convinced...it will happen.
Because when the government itself starts running out of money, what do you think it'll do?
Notebandi 2.0 of course.

So, Here's Why You Need To
Be Prepared For Notebandi 2.0

As we saw above, the Big Government is spending way beyond its means...
There are TRILLIONS wasted almost every year and there's no easy way to generate cash...
Thus, I believe that they cannot survive without Notebandi 2.0.
  • Whether they'll come for the cash...
  • Or whether they'll come for your property...
Nobody knows.
However, the bottom line remains that our government is growing Bigger and Bigger with each year.
And it needs to find ways to finance itself.
Notebandi 1.0 was just the beginning...It could get a lot worse.
Now, I understand that all this might seem a bit tough to digest.
In fact, I am sure 99% of people who read this will not take this warning seriously...
However, I am looking for that 1% of my readers who are actually concerned about their future.
1% who are willing to act proactively and prepare for this almost-certain calamity...
And because you've been with me so far, I know that you fall in that 1% and thus, are the kind of reader I want.
Now, these are just some of the findings from my research...
And I believe that it is my duty to share this with you.
It's something that I have been working on for months.
Scrutinising economic datasheet and going through exhaustive research papers, and big books...
And I've revealed it all in my book....

India's Big Government
The Intrusive State 
And How It's Hurting Us

I'll Send A Hardbound Copy To All My Readers...Virtually Free!

This is One Book You Must Read.
It doesn't matter if you are just beginning your career...
Whether you have a solid, well-settled business...
Whether you are an experienced professional....
India's Big Government will impact you.
And this one book reveals full details of thisirreversible trend.
It's something you will not find being covered in newspapers, blogs or those TV channels.
This is pure, intensive research that reveals the harsh truth behind Notebandi 1.0 and why we're bound to see Notebandi 2.0...
So, it's something that could have a real impact on the lives of each and every citizen of this country.
And through my research, I want you, my valued reader, to be prepared.
In fact, I want this book to be a permanent part of your library.
Because I strongly believe that that we'll be referring back to this book over the coming years...as the crisis becomes more severe.
And that's why I have decided to send a hardbound copy to you...virtually free.

Praise For Vivek's Easy Money Trilogy

Forget what you think you know about money and read the true, absorbing tale told by Vivek Kaul in his thorough but fascinating book, Easy Money. A great read.

Al Ries (Marketing Guru & Author)
If you want to read about all the experimentation and follies of governments and economists involving the use and abuse of money over ages, you can do no better than to read Vivek Kaul's eminently readable Easy Money.

R Jagannathan, Editor, Swarajya
Kaul's Book is the financial equivalent of the story of the origin of the universe.

Kevin Maney, Author of The Maverick and His Machine
Vivek Kaul's Easy Money should be required reading for anyone seeking a degree in finance anywhere in the world – it's that good.

John Truman Wolfe, Author of Crisis by Design
Because if you delay, it could be too late...

The Initial Symptoms Of The Crisis 
Are Already Here

While our Big Government continues to waste its resources by the billions and trillions...
And therefore remains distracted...
We, the people, are suffering.
Take for instance one of the biggest crisis that is slowly but surely engulfing India.
As per many estimates...
Almost 33,000 people are entering the workforce everyday...That's 231,000 a week...1,000,000 a month...
And 12 million a year.
In fact, this trend could continue for years to come, if not more.
Let me repeat that...India could see over 12 million individuals joining the workforce Every Year.
And instead of creating new jobs, we keep hearing about new policies.
The result?
In Uttar Pradesh, for 368 peon positions, the government received 2.3 millionapplications.
Yes, that's more than 6,330 applicants for each position of a peon.
And to make the matters worse, this included PhDs, post graduates and graduates.

"The Indian state is too much of a jack of all trades.... Unfortunately, the Indian state has shown itself unequal to the challenge of discharging core tasks. This is partly because it has taken on too much that is outside its proper domain"
Vijay Joshiin his book "India's Long Road—The Search for Prosperity"
In Chhattisgarh, for 30 peon posts, the government received 75,000 applications.
That's 2,500 applicants for each position.
And yet again, these included post graduates, graduates, and engineers.
In Amroha, again Uttar Pradesh, for 114 sweeper posts the government received19,000 applications.
Many of these were again Engineers and MBAs.
So, we're already at an alarming stage if we have PhDs applying for a peon position.

And Here's How The Situation 
Could Get Worse...Real Quick!

Now, as I said, there are almost 33,000 people entering the workforce everyday...
Almost 12 million young adults looking for jobs on the streets...
And by next year, another 12 million join in...
And what is this government doing about creating jobs?
The Business World magazine points out: "According to the Labour Bureau of India,only 1.35 lakh jobs were created in 2015 and 4.93 lakh in 2014 across eight sectors."
That's not even a drop in the ocean of jobs that need to be created.
What about the rest of the millions of youngsters who don't have a job?
Can you imagine where all this could lead to?
I believe it could lead to mass protests...
In fact, I believe it could lead to a nationwide uproar!
Tahrir Square - February 10, 2011
Tahrir Square, Eqypt (Source: Johnathan Rashad)
Yet, our government hasn't woken up to this ticking time-bomb...
And continues to waste billions and trillions for its own survival.
In fact, as I mentioned, this is just one example of how a big government, which worries more for its own survival and growth, can put at risk the life of people in this country.
Including you.
There are numerous other examples we could see all around us...
And you can read about all of them in my book.
But, the question we need to ask right now is...
When this government, that is not even concerned about its own common citizens, keeps overspending... What do you think it'll do?
Notebandi 2.0 of course.


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