11:18 pm - Tuesday February 19, 2019

क्या २०२४ तक भी भारत की आर्थिक प्रगति मंदी रहेगी ?

जो लोग यह आशा कर रहे थे की २०१४ की ऐतहासिक  चुनावी जीत से भारत की अर्तव्यवस्था को पंख लग जायेंगे, उनका अब पूर्णतः मोह भंग हो चुका है . यह तो अब निश्चित है की वाजपेयी व् यूं पी ए – १ के कार्यकाल की विकास दर तो अब संभव नहीं है . २०१९ तक चुनावी जीत की ललक ही देश के सर पर चढ़ कर बोलेगी व् राज्य सभा के अल्पमत को समाप्त करना

व् राज्यों की कांग्रेस सरकारों को हटाना ही सरकार की प्राथमिकता रहेगी . यद्यपि न तो नरसिम्हा राव न ही वाजपेयी के पास इतना बहुमत था परन्तु देश की राजनीति आर्थिक प्रगति पर हावी हो गयी .अम्बानी की सरकार व् सूट  बूट की सरकार के नारे व् दिल्ली व् बिहार की हार ने सरकार का साहस समाप्त कर दिया . देश पर बाबा रामदेव की अर्थ नीति  का ज्ञान  लाद  दिया गया . नोट बंदी राजनीती से सफल व् अर्थ निति से घातक सिद्ध हुयी .जी एस टी के प्रारंभिक स्वरुप ने व्यापारियों की कमर तोड़ दी . अर्थव्यवस्था तो पहले से ही सुस्त थी और इनसे पूरी तरह बैठ गयी . परन्तु निम्न लेख के अनुसार तो अगले पाँच वर्षों मैं भी

पहले समान विकास की संभावना नहीं है क्योंकि राजनीती लोक लुभावन नीतियों तक सीमित रह जायेगी और चुनाव भावनात्मक मुद्दों पर जीते जायेंगे . बिना उद्योगों व् कृषि के प्रगति के व् बिना निर्यात व् नौकरियों के आज कल क्या क्या विकास हो रहा है समझ के परे है . दाल को दुगने दाम पर बेच कर जी डी  पी बढ़ाना वित्त विभाग को मुबारक हो .

अगर यह हुआ तो देश के लिए बहुत बड़ा दुर्भाग्य होगा  क्योंकि फिर इतने बहुमत वाली  सरकार नहीं आयेगी  .बिना विकास अवरुद्ध किये भी चुनाव जीते जा सकते हैं   परन्तु वित्त विभाग मैं ज्ञान का अभाव है और देश को इसकी सज़ा भुगतनी पड़ेगी .

रीडिफ़ का लेख , इसके विचार सिर्फ लेखक के हैं  समादक के नहीं .


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In 2018 and 2019, with More Socialism, Modi Will Become More Like Manmohan

Tue, 19 Dec 2017



As expected the Bhartiya Janata Party (BJP), won the state assembly elections in Gujarat. The margin of victory though left much to be desired.

Before the elections, the party president Amit Shah had talked about the party winning 150 out of the 182 seats in the state assembly. The party finally ended up with 99. So, there was a clear gap between expectation and reality. I say this because Amit Shah is a brilliant electoral strategist and his words should never be taken lightly.

Finally, it is the massive support that the BJP enjoys in the cities of Gujarat that pushed it through. In the four biggest cities of Gujarat, Ahmedabad, Surat, Vadodara and Rajkot, the party won 46 out of the 55 seats (Ahmedabad 16 out of 21 seats, Surat 15 out of 16 seats, Vadodara nine out of 10 seats and Rajkot six out of eight seats).

What this clearly tells us is that the Goods and Services Tax (GST) wasn’t as big an issue in the cities of Gujarat, as was made out to be in the days leading up to the elections, in the media. It clearly impacted a section of the population, but that wasn’t large enough to make an electoral difference. The only other explanation for this lies in the fact that even those impacted negatively by the GST, couldn’t get themselves to vote for the Congress.

The other interesting point here was that more than 5.5 lakh voters chose the NOTA (none of the above) option while voting. This amounted to 1.8 per cent of the total eligible votes. The NOTA votes were more than or close to the winning margins in nearly 24 constituencies. One explanation for this that has been offered is that a small section of the population which is unhappy with the BJP didn’t want to vote for Congress either. The trouble with this explanation is that there is no way to verify it. It could even be the opposite.

Anyway, getting back to the point I was trying to make-the BJP won 46 out of the 55 seats in the four biggest cities of Gujarat. How did the electoral results look in the remaining 127 seats? The BJP won 53 of these seats. The Congress won 71. Hence, the Congress clearly did much better than the BJP beyond the four biggest cities.

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There will be economic and political implications of these electoral results in other states like Rajasthan and Madhya Pradesh, where the elections are scheduled in the months to come. Some points are as follows:

  • The basic problems in India’s rural economy are not going to go away any time soon. The size of the average agricultural holdings in India has fallen as land has been divided across generations, making agriculture as a profession very non-remunerative.Over and above this, India has too many people in agriculture than is economically feasible. A recent discussion paper by Niti Aayog points out that as of 2011-2012, agriculture employed 64 per cent of the rural workforce but produced only 39 per cent of the total rural economic output. Hence, for agriculture to be economically feasible 8.4 crore agricultural workers need to be shifted out of agriculture. This is around 70 per cent of the non-farm workforce in the rural areas. This isn’t going to happen overnight.
  • Of course, given this huge disguised unemployment in agriculture, people working in agriculture try to work in other areas as well. But the trouble is that there aren’t enough jobs going around for them. Data from the Labour Bureau suggests that only 52.7 per cent of the people looking for jobs all through the year, in rural India, are able to find one. Given this, nearly one in two people in rural India do not have jobs all through the year.Hence, rural India has a problem at two levels: 1) Agriculture as a profession is no longer as remunerative as it used to be. 2) There are not enough other jobs, given their low skillsets, which people working in agriculture can take on, to add to their income over and above what they make in agriculture.

    This explains why land-owning castes have been protesting all across the country. This includes the Patidar Patels of Gujarat.

  • Given this, the BJP in every state that it goes to election after Gujarat, it is likely to promise a farm loan waiver, as it has done in other states over the last one year. This is going to cost state governments all across the country a lot of money. It will also create moral hazard with future borrowers waiting for farm loan waivers than paying off their loans.The question is why did the BJP not promise a farm loan waiver in Gujarat? The rural areas in Gujarat are not as badly placed as in other states. One reason for this lies in the fact that the livestock economy in the state, has continued to grow robustly. Also, over and above this, the non-farm economy in the rural areas, created job opportunities because of the overall faster growth in the state.

    In fact, farm loan waive offs will become even more important given that, the states of Madhya Pradesh and Rajasthan, are not as urbanised as Gujarat is.

    Also, in the run up to 2019 Lok Sabha elections, I see the minimum support price of agricultural crops going up. As per the Shanta Kumar Committee, the minimum support price system benefits under 6 per cent of the farming households in the country. While, increasing MSPs may not benefit many farmers, it does have a strong signalling effect.

  • The Modi government will also look to consolidate its position in the urban and semi-urban areas. And for that, chances are it will waive off Mudra loans of Rs 50,000 or lower. In total, over 7 crore of Mudra loans of less than Rs 50,000 have been given out.
  • As far as the Congress is concerned, it needs to start rebuilding itself, particularly in the rural areas because that is where its support is. This is a rather obvious insight.

To, conclude, the Modi government will give out doles and waive off loans, in order to improve its position. This strategy will not be much different from what the Congress led UPA government led by Manmohan Singh, did in the 2009 elections. This again goes with the broader point that I keep making-India has only one model of governance and that is the Congress model.

Comments on this edition of Vivek Kaul’s Diary: Post a comment | Read comments

Vivek Kaul is the Editor of the Diary and The Vivek Kaul’ Letter. He is the author of the Easy Money trilogy. The books were bestsellers on Amazon. His latest book is India’s Big Government – The Intrusive State and How It is Hurting Us.

Eight Axioms to Understand the Fake Economy

Tue, 19 Dec 2017



DELRAY BEACH, FLORIDA – What have we learned so far?

Let’s spell it out as a series of axioms.

  1. Real money must be connected to the real economy of energy, time, and resources. Traditionally, gold makes the connection. (In the case of bitcoin, electricity is the connector.)
  2. Time, energy, and resources are limited; money must be limited, too. Real wealth is based on real things. The feds cannot command real wealth to increase, so they cannot increase the supply of real money, either. They can increase only the supply of fake money – the new elastic currency put in place in 1971.
  3. The financial world is cyclical, governed by markets and manias. The economic world is incremental and made up of real things. Markets can reverse suddenly. Prices can collapse. But farms, factories, and films rarely disappear.
  4. Government is always a way for the few to take advantage of the many. While the rest of society engages (mostly) in win-win deals, the feds rely on win-lose deals. Controlling money is a way to force win-lose deals onto people (usually without them realizing how they are being flimflammed).
  5. Things have no inherent price or value. Instead, markets discover what they are worth as people bid for them. If markets are not allowed to function freely, honest price discovery doesn’t happen… and no one knows what anything is really worth.
  6. Interest rates should be discovered, too, honestly… in a free market. Since 1987, the feds have diddled interest rates… forcing them down into the sweet mud of fantasyland, where time runs backwards and risks decline as time passes.
  7. Driving interest rates down to ultra-low levels, the feds have falsified all asset prices.
  8. The Fed is reversing the policy of the last three decades. Instead of adding to liquidity, it is subtracting from it. (By the end of 2018, the Fed says it will be draining about $600 billion a year from the U.S. money supply.) Instead of pushing down interest rates, it is pushing them up. Instead of supporting the stock and bond markets as the world’s number one buyer, it will become the world’s number one seller.
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Fed Banana Peels

What’s next?

That’s today’s question: What? And how? (We eschew the “when” part; we are not good at it… though not for lack of practice.)

Yes, dear reader, the Fed is throwing out banana peels – in the shape of a series of quarter-point interest rate increases. It is just a matter of time until someone slips up.

But to fully understand what is going on, we return to the real role of the feds and their control of our money.

Remember that the few – the insiders who control the government (aka the Deep State) – want to extract wealth, power, and status from the many.

In ancient Rome, for example, they “clipped” the coins – removing part of the precious metals. Then they replaced silver and gold completely with base metal… and finally, with leather.

This was no longer real money. People turned up their noses at it. And even the government refused to take it in payment of taxes.

This debasement technique continued up until the reign of Henry VIII in England, who replaced silver coins with copper to pay for his wars with Scotland and France.

A more recent scam is simply to print up extra paper money. This technique has been used by almost all modern governments, with Weimar Germany, Zimbabwe, and Venezuela providing recent, gaudy examples.

Government uses this fake money to pay its bills… and reward its cronies. Then as the new money disperses through the economy, prices rise.

The public pays more for its bread and beer; usually, it has no idea why. The government then blames “profiteers,” “speculators,” or capitalists with tails.

Latex Dollar

The flimflam of the latex dollar is subtler…

Rather than use it to pay bills directly, the feds lend it out at below-market rates to big banks, who, in turn, lend it back to the federal government.

Then, to keep the swindle going, the central bank buys the bonds from the banks, guaranteeing that the cronies make money… and that the Fed’s supply of cash keeps flowing.

All funny-money bamboozles share the same features: Fake money is created. This money looks like the pre-existing real money. The elite get their hands on it first and use it to call away existing wealth from its rightful owners.

That’s why the “One Percent” – especially Wall Street – is so much richer now than it was in 1971. And it’s why three of the richest counties in the country are now those around Washington D.C., rather than around places where wealth is actually created.

So far, Americans have not caught on. They don’t realize how they are being robbed. Instead, they think they are rich, with $97 trillion in household wealth.

But much of that is just on paper… in overpriced stocks, bonds, and real estate. It is financial, not economic, wealth. And it is subject to repricing in the twinkle of an eye.

Traditionally, household wealth is about three times GDP… and total debt (public and private) is about 1.5 times GDP.

If we adjust today’s numbers to these old proportions, household wealth should decline by $37 trillion… and debt should deflate by about $33 trillion.

These are just numbers. But they show, grosso modo, what to expect when today’s fake-money system blows up.


BILL BONNER Founder, Agora Inc


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Bill Bonner is the President & Founder of Agora Inc, an international publisher of financial and special interest books and newsletters.

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One Response to “क्या २०२४ तक भी भारत की आर्थिक प्रगति मंदी रहेगी ?”

  1. December 23, 2017 at 1:29 pm #

    Slowdown is certainly there but prospects are not as dismal as predicted by such bogus scholars. Every authentic agency has thumbs-upped national economy. These pseudo-scholars are not used to disruptive / radical measures that were unavoidable, should have been taken long ago. Instead of abusing Nehru-Gandh-Vadra dynasty for destroying the economy for 60 years, these fools abuse Modi for adopting corrective measures to save the nation from anarchy. By writing such demoralising articles, these idiots do enormous dis-service to the nation by confusing gullible lesser mortals instead of writing positive aspects and raising their morale.

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