Government’s Goldberg

It’s surprising how most of my writing happens on Wednesdays; maybe I need to consult an astrologer to find out why. OK so today’s big news in the paper this morning was the Gold Monetization scheme. Gold Monetization is where Gold will be treated like Cash. 

This scheme was announced by the Finance Minister Arun Jaitley in this year’s Budget. The scheme is a two pronged answer to the Indian obsession with Gold.

1.       The scheme shall allow public to deposit gold in scheduled banks and earn interest on their gold.

2.       The scheme allows Banks to use the gold received in this scheme to meet the CRR and SLR requirements.

So what does this mean?

Simply put, you and I can deposit our gold in the bank and earn an interest after a fixed maturity period. How does this happen? Well it works just like cash, the Bank will measure, test and tag your gold, and then lend it to jewelers or other investors who may be willing to buy or borrow at a rate higher than the banks offer to pay you. The interest earned in this scheme is not taxable under income tax or tax from capital gains. Please note that interest will be calculated in terms of gold. That is, if you deposit 50g of gold, 10% would be 5g of gold.   

This brings us to some simple but genuine questions

1.       How will they pay interest? Will they add another gram to my bangle? 

Well, no… Your gold will be treated just like cash. Meaning, you will not get to see the same gold bangle at maturity. If your bangle was 50g, then you will get 50g back + interest, but not in the same bangle. You may get the maturity amount as bullions of gold or you also have an option of redeeming it in cash. However there’s a catch, you need to specify if you want gold or cash while signing up for the scheme.

I’ll say what you’re thinking now… Nope, not gonna happen! My mom would never lose her bangles for 5% or 10% or even 30% if she’s never going to get a chance to see the bangles again. 

So why make this scheme? Politicians and bearcats are probably smarter than us, they would obviously be aware of our attachment to personal jewels, why would they draft such a thing??

Well the answer is simple. The general public is not the target of this scheme. This is for investors who already have gold in their portfolio. Gold itself would grow its worth in time, imagine depositing it in banks and earning interest on it, that’s a double income on a single asset! 

All this is fine and obvious. What are we missing? Well, tipping the rich to invest more is not the only goal here, the second leg,(which is actually the first) is that Banks would be able to allocate this gold to meet CRR and SLR requirements. Banks, need to place certain percentage of their deposits with the RBI, currently the CRR and SLR together constitute 21.5% of the deposits.  Meaning, if a bank has 100B of deposits it needs to deposit 21.5B with the RBI. The remaining 78.5B can be used for their business that is; giving loans. So, now that gold has come into the picture, Banks may keep gold in the RBI and use more cash to give away more loans and hence increasing growth in the country. 

So to summarize, what’s this scheme about? 

1.       Make big investors earn two times on a single asset.

2.       Allow banks to use the gold to meet their duties and save cash to give more loans. 

 

Will this reduce gold imports?

No

Will this make any difference to household gold?

No

Will this mean anything to small investors?

No

Do we need this scheme?

I don’t know.

AAP Bhi Aadmi Ho

Arvind Kejriwal was sworn in as the 7^th Chief Minister of Delhi about 15 days ago. It was a big day in the politics and democracy of India. I wasn’t really happy about the Aam Aadmi Party taking Congress support to form the government in Delhi. The day when the news broke that AAP will form the government in Delhi  with Congress aid, I made a sad facebook post. Here’s the pic:

Yeah, call me a sadist, and heres a comment by one of my high school teachers

And another friend of mine said:

Ofcouse I only had this to say:

And then the status died away.. and 5 days later Arvind Kejriwal was sworn in as the CM and he made quite a decent speech that day. 

I made a status:

I realized that I was missing something and this congress alliance may not prove that damaging and AAP would still be able to play a dominating role and provide the people of Delhi some good governance.

The days that followed saw a lot of changes and decisions like the transfer of DJB higher management, 700 liters of free water per day and maybe a few more that I don’t remember. But all the while and media, other political parties and sympathizers and supporters of the NaMo Movement started posting pictures, excerpts and quotes of how Kejriwal and the AAP were switching sides, changing tunes etc etc.. the 3 biggest things that the people have found hardest to forget and forgive are:

1.       Kejriwal won’t fight an election – He contested and became CM

2.       Kejriwal won’t take VIP security or government facilities (car, house etc) – Well he did that

And the worst

3.       Kejriwal swore on his children that there would be no support taken from BJP or Congress – Well, we all know what happened.

Now, ofcourse I’m writing this post to well somewhat justify his statements, now these three have not risen from different sources. The one reason is, he’s green, that’s it.

Being a.. well talkative person I know that sometimes you go overboard, get carried away and say something of paramount proportion when you don’t know the complete picture. Haven’t we all seen people who are ‘confidently wrong’? That’s what happened here, it’s practically impossible to have a CM walking the streets without security. I’m not talking about the CM, the people would swarm the place and hurt one another.. its so with any celebrity and he or any celebrity has no control over it.. so this was an innocent ‘confidently wrong’ statement. How can he say something and we take his word for something that isn’t in his control?

Speaking of the swearing on children part, the same goes here, he was ‘confidently wrong’ because of his innocence, as I said, he’s still a little green, now what do we do of an innocent first timer? Do we show some consideration or we scrutinize and criticize his every move? Expect him to be perfect from day 1? That’s just too much expectation from us, the media and other politicians. Given time, maybe he’ll learn his limitations and learn that every word is counted.

To be a little neutral here, I really am concerned about the ‘370 pages of evidence against Shiela Dixit’ statement. Ofcouse, thinking realistically, there’s no such thing as ‘unconditional’ support. Lets leave it as that.

Finally, why did he enter politics, contest and become CM? well, We must think of why AAP was formed in the first place, there was no option left, right? No Lok Pal Bill would be passed with all the Anshans and people were simple getting bored and eventually fizz out. 

This was a right decision, but sadly, we have a perception that nothing can be changed or that people who get down in the pit to clean also end up smelling like shit.. or people have no hopes of ever having a clean political system. Maybe.. but the one line I remember from The Shawshank Redumption is “No one can ever take away hope” So I’m gonna hope, hope that change is possible, change will happen and I will do my part. (by making blogs and fb posts? Sure why not)

Aasaan Over Assam

The disgrace of Indian Politics shines from the State of Assam this July. More than 40 lives were lost before I came to realize the seriousness of the situation. Thousands devoid of homes, roofs and a village are now being held at refugee camps. Some of the oldest inhabitants of India are now living on bread crumbs and wet canvas over head. 

Just after the Rain Gods showered fury on the people of Assam, the fury of men belittles that of the god’s. The ethnic riots that broke out in the first half of July took me down by surprise. The riot was not the surprise, it was the complete lack of coverage or attention it received from the country that made me raise my brows and then bring down my fist. 

The apathy of the people, the inability of the state government, lack of concern of the central government and the shocking uninterest of the media makes my bones itch. 

The Chief Minister of Assam Tarun Gogoi, is all too very well known in Assam for his vote bank politics. The illegal immigrants from Bangladesh receive a fresh start from Indian soil. Food, shelter, clothing and everything a native would receive is on the menu; for free. The game is simple; the Congress party wants to prove its sovereignty by extending its hand to the Bengali speaking Muslims.  

Out of the 4 states that border with Bangladesh, Assam has the highest number of illegal immigrants from Bangladesh. It’s also a fact that Tripura has more incidents of immigrant initiated crimes than Assam; and that the Illegal Bangladeshi immigrants caught in Meghalaya are sometimes sent to Assam. Meghalaya again is ruled by the congress party. One can actually say that Assam’s tolerance to these Bengali Speaking Muslims is a trade off for the congress and congress allies to prove their sovereign intentions. 

To make proposals of a farfetched theory, the acceptance of Muslims into Assam over a hostile communist state of Tripura could have got Mamta Banerjeethe the Muslim vote banks of West Bengal. 

Leaving that apart and focusing on the riot, It haunts me to see that the country is least bothered about what’s happening in Assam. The electronic media in specific is more interested in talking about The 13^th President’s first speech, Anna Hazare’s fast, Indian cricket team and god knows which product Samsung is going to release next. 

The Center Had not bothered to dispatch security forces to the riot affected areas till it was inevitable to turn its head from the fish curry on Pranab’s table. Over that, there are loathful people like Sharad pawar who want to throw threats of destabilizing the government for personal gains. Caught between such unruly allies, swinging knifes of economic slowdown and a blunt Obama and Co. hell bent on driving investors away from India, the central govt hardly has the time or priority to look at Assam.

This lack of action from the governments in deploying security was the sole reason for the elevation of the aggression. The innocent Bodo’s of Assam had to seek help in form of security from the Militants. This might sound drastic, but with no help from any govt body, they had to fend for themselves. Choosing a familiar Devil over an uncertain God is not a hard choice. The consequences of this would be a growth in public sympathy for the militants, Assam, or in general the north east of India has no shortage of militant groups looking for local support. Once with the help of local public if the militants succeed in getting control of the siliguri corridor, then we can kiss the shivalik Himalayas of India a final goodbye. This news however will not be made public, because most of the print and emedia is either on immigrant sympathy mode or politician loyalty mode. Who gives as damn to the people?

My dissatisfaction with the politicians doesn’t end there. I’m also angry at the opposition, when the opposition leaders can pass comments at magazine covers and openly criticize for deaths of pilgrims, then what makes then stay mum at the situation in Assam???

The Answer – BJP doesn’t have a chance of winning an election in the north east. Except for a few distant stars of hope, the north east has been impenetrable for the BJP. Making comments and forcing the government to act won’t win any votes in the congress/communist/regional party bound states of the north east. So the BJP decides to throw small pebbles at congress and not make a real effort at getting things done.

This episode of ethnic/communal or whatever you want to call riots between indigenous Bodos and the refugees is a disgraceful situation for the whole country. The truth about the ineffectiveness of the greed based political system, the powerlessness of the common man, the crooked vote bank politics, and the euphoric media that turns at shiny objects are all evidence of the apathy for the North East of India.  

Just what the separatists need. Proof of disownment.

Can't you see??

The politics of Karnataka has really done it this time..  I don't mean in the sense that its caught national attention, or that its the 4th or 5th time his "excellency" the governor of karnataka HR Bharadwaj has asked the cheif minister B S Yeddyurappa, lets call him Yeddy, (the whole country does ) to prove his majority in the house or that the governor is a congress man or whatever..  what really gets to me is how can these damn politicians be so dumb?? i mean.. lets recap.. karnataka has never had a bjp govt.. and people of karnataka are not really the bjp type too.. so what really made us bring the bjp govt to power? I'll tell you.. its the dumb opposition.. thats right.. its people who are not a part of bjp are the ones responsible for bjp's success.

It was the period of 2006- 2007, kumaraswamy and yeddy were running a coalition govt.. it set a lot of sparks between kumaraswamy and his dad deve gowda.. but still everything was cool for kumarswamy.. hmm.. need to find a short for kumarswamy.. lets call him kumar.. or kumara.. that sounds more like kannada... yeah.. so everything was cool for kumara and yeddy, and also the public.. but they're politicians right? cant expect much from them.. it so happened that  in nov '07 when yeddy was supposed to take over the cm's seat.. kumara back stabbed yeddy.. yeah.. this was where it all started..
at that point, yeddy got a lot of public sympathy.. this is what made the people of karnataka vote for bjp in the elections of '08.. and obviously when when someone had the public sympathy.. hes bound to win.. so yeddy and the bjp came to power in '08 curtsey of shri. H D kumaraswamy.

My folly with the dumb head of the opposition doesnt end there... after the govt was formed.. the opposition plus the governor.. oh i forgot his "excellency" yeah his "excellency" the governor of karnataka joined in with the opposition with a mission to bring down the bjp govt.. so they dug deep.. found out skeletons of all shapes and sizes... and the people were also angry for some time.. thats when the governor asked yeddy to prove his majority in the house.. once? twice... thats ok.. but his "excellency" has used all his majority requests.. hey yeah! there should be a limit for this.. after which it would show " you have exceeded you limit of trying to bring down the govt." anyway.. so yeddy "somehow" comes on top on all occasions.. and the public is finally cool for some time.

Does the governor like it?? nawwwwwwwwwwww... so he sets out again and calls out for another proof of majority on the floor of the house... this has got to be the limits.. and i dont mean it politically.. i mean it in a common sense way.. doesnt the opposition have a head?? really? so desperate that you forgot that heavy load of crap on your shoulders?? once kumara successfully made sure that yeddy gets the chair.. now they're doing it again... by making it look so obvious that they are trying to overthrow the govt.. the public are getting into the act too.. even the people who generally would be indifferent or even hate yeddy have started developing a soft corner for yeddy.. this is what the opposition has managed to do.. make sure that yeddy and the bjp never lose in karnataka.. doenst this make you wanna look at them and say "how dumb can you get??"
meanwhile... my advice to yeddy... just stall my man.. the opposition and everyone that hates you are making sure that you win..

ok now the major question.. whats the point of this write?
lets hope yeddy or bjp or any politics related noob doesn't get to read this.. but i only meant to say that they're just manipulating us.. now the politicians may or may not have realized that whatever they do has an effect on us.. firstly because of the mob mentality and second, that in india, everyone loves to take sides.. so.. what i mean to say.. is just dont give in.. if you are beat to shit and made to vote for a party on the election day.. then please dont fight back.. give in.. but your head.. thats yours.. just dont let anyone play with your head.. atleast not these dumb guys.. just know what you want and dont let anyone play with your head.. peace!