India Economy Falls into Chaos – Dollar Rise in Huge Demand
by Martin Armstrong
ArmstrongEconomics.com
Nov 25, 2016
US dollars are soaring in premiums on the street. There is a serious risk that the government has shaken the confidence of the people to such a degree, that they trust the US dollar more than their own currency. Prime Minister Narendra Modi has come out an said the currency changeover could still take a few weeks and could lead to inconveniences, according to the magazine Brics. The Indian economy is a highly cash transacted economy far more so than the United States and Europe. The government has brought the economy to a virtually standstill. Food stores are close to closing because the customers have no money. Small and medium-sized enterprises have stopped functioning because the invoices are not paid for.
When Japan would routinely devalue the outstanding currency in the same manner each time a new emperor took the throne, the population responded by using rice and Chinese coins. The Indian economy is turning to the dollar. Physical dollars are commanding a premium because they can politically trust the dollar and not their own currency.
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