India's Prime Minister Narendra Modi on Tuesday night announced demonetisation of Rs. 1000 and Rs. 500 notes (the two highest denomination bills) with effect from midnight, making these notes invalid. Some highlights:
- The existing bills can be deposited in a bank account until end of the year. This forces people who literally hid bags of cash ("black money") to either reveal the out-of-circulation currency, or effectively forego it forever.
- The new Rs. 500 and Rs. 2000 denomination bills will come into circulation next year.
While it is a major assault on black money, fake currency and corruption, do you think this move will pay off? What other interesting consequences do you think will result from this?