A stranglehold of bonds.

"Major central banks, including the Federal Reserve, the European Central Bank and the Bank of Japan, are formally independent, a system known as 'monetary dominance'." However at the Fed's annual fathering at Jackson Hole, Wyoming, "The topic of 'fiscal dominance' will be one of the key questions facing the Fed's new chair Kevin Warsh." Fiscal dominance is when the central bank prints money to finance the government's fiscal deficit, which leads to inflation, currency devaluation and a flight of foreign investors. Reuters. The questions have arisen because, "Total US debt has topped $40 trillion for the first time," as "The Treasury's latest daily cash and balances statement showed total public debt outstanding at $40.07 trillion, a total that includes Treasury securities held by the public for $32.266 trillion and intra-governmental debt holdings of $7.782 trillion." Reuters. "A sell-off in US government bonds is pushing up borrowing costs, which could squeeze households, companies, financial markets and the federal budget alike." "Treasury yields are what the government pays to borrow and higher yields raise federal interest costs." Reuters. "Debt levels in developed countries are reaching thresholds that look increasingly unsustainable," and "In addition, massive borrowing by technology companies to fund a buildout of AI infrastructure is competing with demand for government bonds." "In Europe, Germany's 10-year Bund yield touched its highest since 2011, French yields were at their highest since 2008 and Britain's 30-year borrowing costs neared peaks in May that marked the highest levels since 1998." Reuters. Japan is no exception. "For years Japan exported capital to the rest of the world." Today, "Thirty-year Japanese government bond yields are now above 4%." "Fiscal realities are increasingly influencing pricing." For India, "Domestic fundamentals remain supportive, and Indian bond yields continue to offer an attractive carry advantage relative to many developed markets." MC. "India's 10-year government bond yield is around 6.87%, while the US 10-year Treasury yield is in the 4.6-4.7% range, leaving a spread of roughly 2.1-2.3%, or 210-230 basis points." For a foreign investor, "A simplified way of looking at the trade-off is: India bond yield - US bond yield - expected rupee depreciation - hedging cost = effective return advantage. With yield differential now much smaller than it has been historically, even a moderate fall in the rupee can erode the additional return available from Indian bonds." MC. In the Union budget of 2026, The government is estimated to spend Rs 57.473 trillion on 2026-27, 7.7% higher than the revised estimate of 2025-26. Interest payments account for 26% of the total expenditure, and 40% of revenue receipts." "Fiscal deficit in 2026-27 is targeted at 4.3% of GDP." prsindia.org. The government was helped by a record payout of Rs 2.87 trillion excess reserves by the Reserve Bank of India (RBI) in May 2026. Kotak Neo. The RBI has also kept its policy rate steady at 5.25%, despite projecting headline inflation at 5%. Mint. All this has led to a sell-off of the rupee. And so, "The RBI has decided to shift to a more constant pattern of intervention to support the currency over the past month, thanks to the foreign deposit inflows, whereas previously it would largely step in to curb bigger swings." ET. Bonds are a form of debt. And defaulting on debt is absolute suicide. They act as a stranglehold on governments. No escape.             

Family first.

"India has attracted nearly $73 billion through the Reserve Bank of India's (RBI) special forex swap facility as of 21 August, with most of the inflows coming through Foreign Currency Non-Resident (Bank) or FCNR (B) deposits." And yet, "The rupee was at 95.71 against the US dollar on 8 June when the scheme was announced and stood at 95.69 on 21 August." That is because banks are handing over all the foreign exchange raised to the RBI in exchange for Indian rupees, and so the dollars are not entering the spot market. The money is being added to the foreign currency reserves. CNBCTV18. "India's foreign exchange reserves climbed to $716.9 billion, their highest level in about six months as of the week to August 14, data showed." "The reserves are within striking distance of a record high of $728.5 billion hit in February." Reuters. We need foreign exchange as, "India's merchandise trade deficit widened more than expected to a six-month high of $31.98 billion." "Imports rose to $76.22 billion against $70.84 billion in June, driven by a rise in crude oil prices and surging imports of electronics goods and gold." "Goods exports hit a record high of $44.24 billion for July,...while they were $40.41 billion in June." Reuters. The problem is the lack of investment in manufacturing. "Gross capital formation (GCF) refers to the gross additions to national wealth," from 1. gross fixed capital formation which is acquisition of fixed assets less disposals, 2. changes in the value of inventories and 3. "acquisitions less disposals of valuables." abs.gov. au. While India's GCF/GDP has grown from 15.3% in 1950-51 to 34.6% in 2024-25, the manufacturing GCF/GDP has grown from 2.4% in 1950-51 to 4.3% in 2024-25. Bank lending to large industry increased from 12.6% in 2007-08 to 18% in early 2010s, and has fallen to 8.6% in 2025-26. "Finance and professional services generated not just growth but also white-collar jobs and high tax revenue." This revenue was used for a large scale expansion of welfare programs to cover for a lack of mass employment and, recently, for direct cash transfers to win elections, wrote Roshan Kishore. "India could face a manufacturing GDP gap of up to USD 5.1 trillion by 2047 if it fails to unlock the potential of advanced manufacturing and adopt frontier technologies, according to a report by Angel One, which estimates that the country could miss out on USD 270 billion in additional manufacturing GDP by 2035 and USD 1 trillion by 2047." ET. A paper by SBI caps said that large capital projects require confidence, and so, "When pricing, input costs and end-market demand remain uncertain, companies choose to defer investment." "Government spending on transport, power, logistics and urban infrastructure is providing demand for private-sector suppliers." ET."Indian CEOs should identify their most complex business problems and create dedicated task forces to solve them using AI, rather than limiting their experimentation with the technology to smaller use cases, Anthropic MD Irina Ghose said. Indian business leaders do not like to be seen to be wrong and so are reluctant to take risks. Lack of confidence and a desire to reduce risks are leading to "A few large private banks, along with to law firms and wealth managers, are ducking an unwritten ban to handhold Indian promoter and business families to set up family offices in Singapore and other jurisdictions." "A large Singapore bank has teamed up with two large law firms and a wealth manager in advising families..." and "About Rs 15 billion is estimated to have been remitted in the past two months." ET.  If they are worried about external factors why would they shift their wealth to foreign jurisdictions? Perhaps they have lost confidence in the government and are worried about the desperate measures being adopted by the RBI. They don't dare to speak. So, quietly slink away. Unnoticed, if possible.      

Antisocial biscuits.

"Prime Minister Narendra Modi asserted at the Economic Times World Leaders Forum that his government's approach to reforms - based on trust, not suspicion, of the people - has led to transformative changes in the Indian middle class that remain a distant dream even in many developed nations." ET. That is a big relief. But, in that case why not answer questions proudly? "US Ambassador Sergio Gor has claimed that India's Ministry of External Affairs had requested 'no questions' from the media after a meeting between PM Modi and President Donald Trump." But Trump forgot and held a 45-minute press interaction. "Everything was on the table." "The MEA has not yet officially responded to the ambassador's account." HT. Should be called an 'embarrassador'. Now even 'Babes in the Wood' (wikipedia) are asking questions. "Gen Alpha students in Bhatpurwa Samuhi, a village along the Yamuna, staged a peaceful protest outside their school, raising their voices over  the long-pending construction of the school building." "Earlier, in Hamirpur, around 300 children had marched 6 km to the collectorate seeking a usable road to the school, while in Lucknow, nearly 250 girls had protested over teacher shortages and basic amenities." NDTV. In the nation's capital, "Gen Alpha students in Delhi's Sonia Vihar have taken to the streets over the condition of the Sadhe Char Pusta Road." "Several prominent schools are located along the road, with thousands of students using the stretch everyday." India Today. Since 2022, having won the election with an overwhelming majority, the BJP has been running the Municipal Corporation of Delhi (MCD). wikipedia. The BJP won the 2025 Delhi assembly election with 48 seats out of a total of 70 seats. wikipedia. The BJP is also ruling the nation with a minority government at the center (wikipedia), with Mr Modi exercising absolute power without answering any questions. Campaigning for state elections Mr Modi asks people for a "double engine ki sarkar (government)' (ET) implying that BJP governments both in the state and at the center will lead to better services. By that logic, Delhi has a 'triple engine government' and yet children have to walk to school through filth. When in a corner, resort to invoking a mysterious agent provocateur. "On 20 August, a large group of students of a government school in Uttar Pradesh's Kannauj district boycotted classes and staged a protest against the principal accusing him of high-handedness, caste discrimination and indecent behavior." "Officials have now claimed that students were lured with biscuits...to malign the government," and the police have filed a First Information Report (FIR) against unidentified "antisocial elements" under Sections 189 (2), 49, 54 and 57. The Wire. So many sections against biscuits! "A team of Cockroach Janta Party (CJP) leaders were chased out of a village in Jaipur when they went for an inspection." They were called "urban naxals, anti-nationals and Pakistanis" (NDTV), typical BJP abuses. On 20 August, a mob of ABVP goons rioted inside Jadavpur University in Kolkata. "Students inside the campus said stones, eggs, bricks, shoes and filthy water bottles were thrown over the wall as the police simply watched." The Wire. The Akhil Bharatiya Vidyarthi Parishad (ABVP) is the student wing of the BJP. wikipedia. When Anwesha Banerjee, a female journalist, asked about a case involving Nikhil Das - ABVP's Jadavpur University unit president - who had been accused of molesting a junior student in 2014, two men from the crowd asked, "What's your name, dear? Should we meet at night?" The Wire. That's typical too. Answer allegation of molestation with a threat of rape. All three, UP, Rajasthan and now West Bengal have BJP governments. The BJP's response to any criticism is with violence and abuse. But, what do you do with children? FIR against biscuits.            

Trillions in debt.

"UK employers shed more workers in July," as "Job vacancies dropped further to 707,000 in the May to July period, the lowest since 2021." "Total US public debt surpassed $40 trillion for the first time, and has now surged by a third in less than five years." "Japan's economic growth unexpectedly slowed in the three months through June," and so "Japan's budget requests for next year are set to hit a record that may overstate the rate of fiscal expansion." While, "China is doubling down on a targeted program that's tapping fiscal resources to drive borrowing by businesses and consumers." ET. "The Congressional Budget Office projects that...net interest payments will total $16.2 trillion over the next decade, rising from an annual cost of $1 trillion in 2026 to $2.1 trillion in 2036." Interest costs will be 3.2% of GDP this year, as a share of federal revenues interest costs was 18.5% at the end of last year, and will reach 15.7% as a percentage of  total spending by 2029. pgpf.org. For comparison, India's "Interest payments on government debt for FY 2026-27 amount to Rs 14.04 trillion, consuming approximately 25% of total expenditure. This makes interest payments the single largest expenditure head, exceeding defence spending and subsidies." "Years of fiscal deficit have accumulated government debt exceeding 55% of GDP." govtbudget.com. "The amount the US owes compared to its annual economic output - known as its debt-to-gross domestic product (GDP) ratio - is 125.8% according to the IMF." UK's ratio is 103.6%, China's is 106.9%, while Japan's is highest at 200%. BBC. "A sell-off in US government bonds is pushing up borrowing costs," and "the rise in yields on the 10-year Treasury is pushing up mortgage rates and corporate borrowing costs" as "Companies typically borrow at a Treasury yield plus a credit spread that compensates investors for default and liquidity risk." It is also bad news for the world as, "A sustained rise in US yields can pull capital towards dollar assets, strengthening the dollar and tightening financial conditions abroad which makes it harder for...indebted governments and emerging-market borrowers to refinance." Reuters. Perhaps in anticipation, the Reserve Bank of India (RBI) has allowed banks to borrow from non-resident Indians (NRI) at higher rates of interest and promised to compensate higher repayment costs due to rupee depreciation. India's largest private bank, HDFC is paying 6.25% on 3-5 year US dollars. "The RBI said authorized dealer banks had reported $65.397 billion in FCNR(B) inflows as of 21 August. Overseas foreign currency borrowings (OFCB) contributed another $4.86 billion and external commercial borrowings (ECB) contributed $2.591 billion, for a total of $72.85 billion. Mint. All these loans will need to be paid back in foreign exchange, with interest. China is also a problem. China's augmented debt Is 135% of GDP and "Unlike US and most other countries, China is seeing debts mount rapidly in the private sector as well. Total debt amounts to nearly 350% of GDP, that is higher than US," wrote Ruchir Sharma. To meet its economic growth target, "Beijing has dropped export prices nearly 20%, producing a 40% surge in volume." Last year, China's trade surplus surged 20% to a record $1.2 trillion. "China's dumping offensive is de-industrializing rival exporters the world over," and "India has been particularly hard hit recently, and has suffered a sharper decline in its share of global manufacturing than many Asian rivals," wrote Sharma. Public debt of the US and China is rising which should mean that they have economic problems. Why would we suffer? That's how weak we are. Sad. 

Dimagi 'friends'.

"The government's proposal to offer training in artificial intelligence to 10 million people over the next year; free online coaching for competitive and government exams and a nationwide campaign to scout and train future Olympic contenders as announced by Prime Minister Narendra Modi in his Independence Day speech, outlines the outreach the Bharatiya Janata Party (BJP) has planned to reset the narrative against the party and government." HT. Mr Modi did not clarify who will teach students, for how many hours per day and in what language. Also, Between March and July, there was one blocking order every 68 seconds, on an average, for online content by the government in India. This amounts to around 1,275 every day, nearly 19.5 million in just five months, according to a report by The Indian Express. If petty officials keep blocking the internet at their whim, what will students learn from blank screens? " Students are paying hundreds of thousands for in-person coaching for the Indian Administrative Service (IAS) exams (Vajirao & Reddy), some repeatedly, but cannot qualify. Only 6.2% of candidates clear the IAS selection exam at the first attempt.. Legacy IAS. Salaries in AI jobs are in tens of millions. A Senior Technical Project Manager earns in excess of Rs 18.3 million (Rs 1.83 crore) per year. 6figr.com. If learning AI or passing entrance exams for seats in elite colleges or for IAS training was so easy why are more than 80 million youth "caught in a difficult spot - with no job, no education and no training"? "According to a Niti Aayog report, an estimated 87 million Indians aged 15 to 29 fall into this category." TOI. Because there are no jobs. And so, "The central government is set to step up its outreach to Gen Z with the launch of the 'One Day, One University' campaign, aimed at creating a more direct and interactive engagement with young people." News 18. Since they cannot offer any job what would be the purpose of these visits? Is this an attempt to campaign for next year's assembly elections in several key states (wikipedia)? As for Olympic athletes, "At the recently concluded Commonwealth Games in Glasgow, India finished fourth with 39 medals.Nine winners were backed by Olympic Gold Quest (OGQ), a private company focused on helping Indian athletes win on the global stage. Notably, its financial spending now surpasses even the government's own spending." Mint. Will the government keep our female athletes safe from predators? Early this month, the Delhi High Court acquitted "former Wrestling Federation of India (WFI) president and ex-BJP MP Brij Bhushan Sharan Singh...in the high-profile sexual harassment case filed by six women wrestlers." DH. In the same speech that Mr Modi was promising an abundance of goodies to Gen Z, he said, "We have succeeded in ending armed Naxals (Maoist militants) in the jungle and freeing the country from that crisis. However, while armed Naxals are gone, dimagi Naxals (ideological Naxlas) are looking for an opportunity." "We need to isolate these ideological Naxals and connect the country's young generation toward building a developed nation." The Print. How exactly? By shooting a 19-year-old unarmed student protester 5-6 times with a pellet gun (HT) and maiming him for life? Mr Modi, "who has long cultivated a strongman image" has suddenly gone soft on Instagram. "Modi's timeline, which until a month ago featured carefully curated posts, now also includes more 'candid' content, such as a get-ready-with-me reel and several selfie style addresses to young people, whom he calls 'friends'." BBC. The 'candid' content and selfie style are all carefully choreographed. Will Gen Z fall for Mr Modi's insincere benevolence and deception? What about the parents who have spent millions on their children's education only to see them sitting unemployed and being beaten up? The fear is that the BJP will use every ploy, including fake charges and extreme violence to stay in power. God protect our children. From fascists. 

How not to tackle a hole.

"Reserve Bank of India (RBI) Governor Sanjay Malhotra said he would prefer greater clarity on the persistence and trajectory of inflation before considering any recalibration of the policy rate, while warning that a broad-based rise in food, fuel and input prices could warrant monetary tightening." ET. "When we say inflation has come down from, say, 6% to 2%, it means the rate of change of prices has come down. But prices are still going up." "There exists a school which always argues that inflation is low; even when high it is not a concern; and, as a corollary, interest rates should be lowered," wrote Madan Sabnavis. Inflation compounds every year which is what consumers feel when they shop. "This fiscal year, inflation has averaged 3.9% in the first quarter, but perception of inflation was 7.7%." And so, "Companies have often said in their investor presentations that demand has been affected by inflation; that higher food bills have left less money for discretionary consumption." In March, "India's federal government...retained its retail inflation target at 4%, within a comfort band of 2%-6%," for the next five years. Reuters. In February, the base year for Consumer Price Index (CPI) inflation was revised from 2012 to 2024 using the Household Consumer Expenditure Survey 2023-24. The weights of various items in the CPI basket changed. Weight of food and beverages decreased from 42.617 in 2012 to 36.753 in 2024, housing, water, electricity, gas and other fuels increased from 16.888 to 17.665, while transport increased from 6.394 to 8.796. pib.gov.in. In its meeting on 5 August, the Monetary Policy Committee (MPC) of the RBI held its interest rate at 5.25% (Reuters) while "After considering all factors, CPI inflation for 2026-27 is projected to be 5.0% with Q2 (July-September) at 4.7%; Q3 at 5.9% and Q4 at 5.5%," said Malhotra. "In August, the growth estimate for this fiscal year has been upped, yes upped to 6.7%, while the inflation estimate has been lowered a tad, from 5.1% to 5%." "Apart from the fact that the MPC's estimates need to be taken with a huge pinch of salt, given the heightened external risks, a repo rate of 5.25%, implies a negative real rate of interest for the next three quarters." "Part of the reason might be the MPC's apparent belief that core inflation matters more than headline. The term 'core inflation' (excluding food and fuel) was mentioned eight times in Gov. Malhotra's Statement," wrote Mythili Bhusnurmath. "The interest question, then, is not whether RBI should have raised rates. The more revealing question is why almost nobody expected it to." "Over time a fairly settled view of the RBI has emerged. It is widely seen as an institution that prefers to wait rather than tighten policy unless inflation becomes impossible to ignore or external developments leave it little room for manoeuvre." That reputation "has been accumulating for several years," wrote Puja Mehra. Since food and beverages have the biggest weight in the CPI basket, the retail price of food depends on supply and a higher interest rate will not increase supplies, is the reason for paralysis. What is conveniently forgotten is that food, especially perishable fruits and vegetables, are transported by trucks from farms to mandis (wholesale markets) in cities which have to pay toll multiple times during the journey. "At the Shahjahanpur Plaza, for instance, the one-way toll is...Rs 665 for a bus or truck and more than Rs 1,000 for vehicles with four or more axles." Mint. The price of diesel used by trucks has also jumped in recent weeks. noewsonair.gov.in. High inflation helps the government by reducing debt (economic help) and low interest allows the government to borrow cheaply. The RBI is trying to help the government but the economy depends on what people earn and spend their money on. What do they say about holes (wikipedia)? Just obeying orders. May be.    

Sugar to prevent climate change.

In a 1991 paper, To Slow or Not to Slow, William Nordhaus "projected that a 3 degree C rise in global temperature would shave barely 0.25% off US income." "His later work went further, predicting gains for cold developed regions - lower heating bills, longer growing seasons, better farming in US, Canada, Russia and Europe - while poor tropical countries bore the losses." He was awarded a Nobel Prize in Economics in 2018, wrote Chandra Bhushan. The result is that wildfires are increasing in Europe in the last 20 years, with a record 1 million hectares burned across the European Union (EU) in 2025. "Almost half a million hectares have burned so far this year in the EU," more than in 2025. "More than half the EU countries have recorded more fires in 2026 than they do in a typical year." CNN. "By mid-August Europeans were sweating through their fifth heat wave of the season," with temperatures well above 40 degrees Celsius (104 degrees Fahrenheit). A severe drought for months contributed to "record-low river water levels and disrupting water and power supplies, transportation routes and agriculture." nasa.gov.in. "Someone will have to pick up the tab for the damage wrought by Europe's increasingly volatile weather, and with the bulk of those economic losses uninsured, that will be the public purse unless immediate action is taken." "Only a quarter of climate-linked catastrophe losses are insured in the EU, with coverage in some countries below 5%." Reuters. In India, "A single day of extreme heat causes about 3,400 excess deaths across India, while a five-day heat wave causes nearly 30,000, a study has estimated." The five states with the highest burden of deaths were "Uttar Pradesh, Bihar, Madhya Pradesh, Rajasthan and Gujarat which together accounted for 66% of the country's excess deaths while contributing only 25% of the country's GDP." NDTV. One reason heat feels so intolerable in Europe compared to India is that summer days are much longer in northern latitudes, recent heatwaves have not been accompanied by any wind and "The sun feels sharper in Europe due to the clear skies, while pollution in India scatters and dissipates heat differently," said Siddharth Singh. "Pollutants not only severely impact public health, but also the earth's climate and ecosystems globally." "Reducing ambient and household air pollution can also reduce emissions of carbon dioxide (CO2) and short-lived climate pollutants, such as black carbon particles and methane, therefore contributing to the near- and long-term mitigation of climate change." And, "the use of fossil fuels for power generation, industry and polluting transport are all major sources of both particulate matter and CO2." WHO. "India has long been portrayed as one of the world's great coal growth markets," as "Coal still accounts for roughly 70% of electricity generation and remains the backbone of the grid." But, "clean energy sources now account for 331.7 Gigawatts (GW) of installed capacity, compared with 302.0 GW for fossil fuels." However, "generation statistics describe today's electricity system, while capacity figures provide a window into tomorrow's." Reuters. "Artificial intelligence (AI) models are becoming cheaper to run," but "The Ministry of power projects an additional 26.3 GW electricity demand from data centers by2031-32." ET. Electricity generation is vital so the government blames automobiles for pollution. The solution is petrol adulterated with 20% ethanol, which is produced from maize, rice and sugarcane. And so, "Govt yesterday allowed the import of 100,000 tonnes of raw sugar, the first such move in a decade, as it stared at a possible decline of at least 20% in the opening stock of the sweetener." TOI. That is naturally raising the retail price of sugar. With the festival season about to start people will not be pleased with high prices of sweets. Import 244 million tons of coal in 2024-25 (coalcotroller.gov.in), try to mitigate by producing ethanol and end up importing sugar. Ethanol, or ethyl alcohol, makes people drunk. And that leads to confusion. Cheers.         

Cash is colorless.

"The US banknote, the most ubiquitous currency in the world used in everything from drug deals to legally accepted tender in multiple countries, falls short of the rupee when it comes to circulation numbers." There are 176 billion banknotes in India compared to 56 billion US dollar bills and 30 billion euro banknotes. "Cash has continued to grow despite the expansion of digital payments." TOI. "India's currency in circulation (CiC) climbed to record-high levels in late 2025 and early 2026. So far in 2025-26, CiC has increased by Rs 2.76 trillion, 3.1 times the rise seen in the same period last year. " At the same time the value of Unified Payments Interface (UPI) transactions increased to a record Rs 28 trillion, wrote Soumya Kanti Ghosh & and Tapas Parida. The reasons could be because the tax department tracked UPI transactions and sent GST notices to street-side vendors and small stores, low interest rates on bank deposits and households recycling precious metals because of the high prices. "The apparent paradox of of the usage of of both rising is a warning that we are settling into a hybrid equilibrium: digital for convenience, cash for avoidance and for those excluded from UPI." One reason for the rise in cash is "the fear of UPI as a trap for small traders." Then, there has been an "explosive growth of unconditional cash transfers , estimated at 2% of GDP across 15 states." That increased cash use in rural and informal India. Thirdly, there is "the rising use of money power in elections," wrote Ajit Ranade. And, since politicians need cash to win, the use of cash will continue to balloon. India has introduced strict rules to restrict cash
transactions. This is expected to curb black money, which is income hidden from authorities to avoid tax, improve tax compliance, reduce counterfeit currency and improve financial inclusion. Bajaj Finserve. On 8 November 2016, Prime Minister Narendra Modi announced the withdrawal of all Rs 1000 and Rs 500 notes from circulation with four hours notice. Known as demonetisation. He said it would "curtail the shadow economy, increase cashless transactions and reduce the use of illicit and counterfeit cash." A total of Rs 15.44 trillion became worthless. The hope was that black money would be destroyed. In reality, Rs 15.28 trillion, or 99% of the banned notes were deposited in banks. A total of only 573,891 counterfeit notes were detected out of 24.02 billion notes withdrawn, which was close to 0%. BBC. However , it caused enormous hardship as people had to queue up for hours to exchange old notes for new, and daily wage laborers, who earn in cash, became unemployed. In the US in 2024, "approximately 20 million households rely on cash as their primary payment method, particularly among those who are unbanked or underbanked and individuals earning under $25,000 annually." "Pro-cash legislation has been gaining momentum across the US, with several states and cities implementing or considering laws to protect the use of cash as a form of payment." cusomag.com. But black money is not all black. "Back in the last years of the noughties India's economy was looking just as frothy as the rest of the world.. It had been growing at an astounding 9% a year for three years to 2008.." "The difference in India is that all this 'irrational exuberance' did not end in disaster." Prof Kaushik Basu says that "pervasive use of 'black money' - illegal cash hidden from tax authorities - created a bulwark against a crisis in the banking sector." BBC. Finally, one can lose only that much cash as they are carrying, but with rising rates of cyber crime and increasing sophistication of cyber criminals (pib.gov.in) one can lose all the money in one's account. Governments earn from seigniorage, which is the face value of currency notes compared to the cost of producing it. Investopedia. This year the RBI transferred Rs 2.87 trillion as dividend to the government. Reuters. Do they want to cut that down? Black or white, cash helps the economy. It has no color.