“Mom-and-Pop Investors” Pin Hopes on Iraqi Dinar

By John Lee.

Reuters reports that “thousands” of people are still speculating on a huge upward revaluation of the Iraqi dinar, which it describes as “one of the chanciest investments in the world“.

It quotes a Las Vegas-based speculator, who previously lost most of his retirement fund on the stock market, as saying:

It’s not a question of if, but when Iraq revalues its currency … The dinar will eventually have substantial value, possibly the highest in the world … If the dinar rises to just even a penny, you would have realized a profit of 900 percent.

The article goes on to say that some speculators are even betting that the dinar could rise to a value of $1 to $3, which would represent gains of between 116,500 percent and 349,700 percent.

One dinar dealer, which reportedly charges a spread of 30 percent on transactions, told Reuters he sold about $577 million in dinars to U.S. customers in 2011. “His customers are U.S. mom-and-pop investors – teachers, police officers, and construction workers“, says the report.

(Source: Reuters)

53 Responses to “Mom-and-Pop Investors” Pin Hopes on Iraqi Dinar

  1. james gilhooly September 23, 2013 at 1:13 pm #

    i bought about 12 yrs ago….$250,000.00 for $243.00 …..when i bought the Dinar was 3000 to 1 now its 1166 to 1 …..and i hope but i do not live on the thought that i will make money on it….but at the time i was drinking and i would spend in a month going to the bar…..well that is what i hope it comes in soon….if it comes in at 1 penny i will get 2,500.00 on my $243.00 in vestment…

  2. GT5Junkie September 23, 2013 at 2:16 pm #

    You have a far better (infinitely better, actually) chance getting rich by blowing a couple grand in Vegas, plus it’s a lot more fun.

    Sure, you can exchange it back, and lose 20%+ in most cases.

    Also, unless they lop. If they lop, good luck, it’s quite possible you’d lose 100%.

  3. GT5Junkie September 23, 2013 at 5:11 pm #

    James, if you paid $243 for 250,000 you didn’t get a 3,000 to 1 rate (which the current IQD has never even been that low, it never got any lower than the 1695 to 1 it started at as seen here: http://www.cbi.iq/documents/CBI_FOREIGN_EXCHANGE_AUCTIONS.pdf )

    250,000 dinar for $243 is 1028 to 1. The current rate today is 1166 to 1. That means your $243 investment, after 10 years, is worth $214, but only if you didn’t have to pay a spread. With typical dealer spreads it’s worth more like $180. If you were to sell it on eBay yourself you might get as much as $250 for it.

    So your 10 year investment has netted you:
    Actual value: 12% loss
    Dealer value: 26% loss
    Sell yourself on eBay: 2.9% gain.

    Your 2.9% gain is less than 1/3 of a percent per year. My checking account pays better interest than that.

    There’s zero reason it would go to 1 penny. It will not happen.