@mitu you are totally right. I switched to carbon and everything sounds great. Thanks for the help.

@simon123 I noticed two things, (1) you are using USB-powered speakers and (2) you didn't seem to have test the suggesitons about using alsamixer.
So I have some suggestions for you to try:

Are you connecting these speakers to the RPI itself using a USB port? This might be problematic because the RPI is known to not deliver much power through the USB ports, and I suspects speakers are power hungry. Can you try to power the speakers with a laptop or other source via USB but the audio from the RPI? Can you go to a console and type the following command to set the volume using alsa: amixer sset PCM 90% unmute. This sets the volume reasonable high so be careful with the noise.

After point 2 you should see something like this (volume set to 90%):

Simple mixer control 'PCM',0 Capabilities: pvolume pvolume-joined pswitch pswitch-joined Playback channels: Mono Limits: Playback -10239 - 400 Mono: Playback -663 [90%] [-6.63dB] [on]