In this interview with Micah Hoeschele, I discuss India’s currency ban and the damage being done by demonetization.

The policy is being sold as a fight against corruption, but it is instead disrupting commerce, punishing ordinary people, damaging the informal economy, and expanding arbitrary state control over savings and transactions.

Watch the full discussion below:

Key Takeaways

• India’s currency ban is creating severe disruption in a cash-dependent economy.
• Ordinary people, small businesses, and the informal sector are bearing the heaviest burden.
• The policy is unlikely to eliminate corruption; it is more likely to redirect it through bureaucratic channels and political connections.
• Demonetization is increasing state power over private savings, transactions, and economic life.
• Gold, foreign assets, and geographical diversification become more important when governments attack cash.