By John Lee.
We get many enquiries at Iraq Business News relating to the future of the Iraqi dinar (IQD), for example:
- Will the Iraqi dinar increase in value?
- Will the currency be re-denominated, dropping the 'three zeros'?
- Is it wise to buy Iraqi dinar?
Firstly, Iraq Business News is not in a position to give investment advice. Our mission is to provide our readers with the highest quality information on the business and economy of Iraq.
As the value of the Iraqi dinar affects trade, we will continue to report on any possible re-valuations and/or redenominations as soon as information is available.
We hope that this information will be useful to the key decision-makers in Iraqi business, and to all who are interested in the development of the country; gamblers and people involved in get-rich-quick schemes/scams are not our target readership.
It's clear from the correspondence we receive that some people, who like to think of themselves as 'investors', genuinely believe that at the stroke of a pen they will make a 1,000-fold return on their purchase of dinars.
Those people might like to consider some questions before putting any further funds at risk: Read more ...
Excellent and much needed common sense article. The entire self-centered blinkered reality of the "Go RV!" crowd is based solely upon a "me and my banknotes" obsession on the back of suspension of disbelief & manufactured hype, and consistently ignoring the blatantly obvious larger global impossibility on the flip-side of the equation. There's no economic difference in the Iraqi Dinar became 1,000x stronger vs the $ in real-terms overnight, and the $ devaluing by 1,000x against a static Dinar. Hands up who thinks it's a good thing if Obama declared he wil devalue the $ by 1,000x tomorrow against a country the USA hopes to trade more with? Yet it's exactly the same thing!
In both cases, America (and all other non-Iraqi's on the planet) would suddenly find Iraqi products 1,000x more expensive to import, since 1170:1 (0.000855 $ per Dinar) to 1.17:1 (0.854 $ per Dinar) outside of a redenomination would mean today $1 buys 1170 Dinar and tomorrow it buys only 1.17 Dinar, so a 1170 Dinar exported Iraqi product ($1 real terms) would essentially leap up to $1,000 for Iraq to export and for Americans (all non-Iraqi's) to import! Trade with Iraq would cease to exist and Iraq's export economy would collapse as the abnormal 1000-fold out of whack exchange rate simply wouldn't reflect any real-world market prices compared internationally whatsoever to any other currency ($, €, £, Yuan, Ruble, etc) and no-one would trade.
"Q1: If the dinar becomes 1,000 times more valuable, it will become 1,000 times more expensive to do business in Iraq."
Indeed. To give a real-life example of how absurd the "Go RV!" crowd's junk economics is:-
Say you're a Jordanian businessman buying agricultural goods from Iraq (say 100 tons of Iraqi wheat at $345 per metric tonne for a total market value of $34,500). Current exchange rates are:-
1168:1 IQD vs USD
1647:1 IQD vs JOD
0.707:1 JOD vs USD
$345 global wheat price per metric tonne. This $34,500 global market price (for 100 tons) of wheat works out to be both 40,296,000 (40m) Iraqi Dinars and 24,391 Jordanian Dinars.
- Redenomination ("lop") : If Iraq redenominates ("lops"), then the Dinar moves to approx 1.168 vs the USD and 1.65 vs the JOD. Price of wheat gets 3-zeroes lopped off (as does everything priced in Dinar) and wheat gets redenominated to 40,296 new Iraqi Dinars. Price in Jordan and the USA is still respectively 24,391 Jordanian Dinar's and $34,500. All three currencies reflect the global free-market value of wheat. All the maths adds up and the equations all balance (as they ultimately have to).
- "Pumper RV"If Iraq "RV's" 1,000x to match the $ 1.168:1 WITHOUT a redenomination simply by arbitrarily inventing a new peg (like only pumpers are claiming), then the Dinar moves to 1.168:1 vs the $ and 1.647:1 vs JOD, but the price of that wheat in IQD stays the same (30m Dinars) because it hasn't been redenominated with a 3-zero lop and "RV's" (external peg adjustments) affect nothing internally. USA's 7 Jordan's currencies still match the global market wheat price, but Iraq's wheat price is now manipulated by an artificial "RV" peg which results it in being 1,000x higher than every other country on Earth.
So the Jordanian businessman now sits there in amusement after being asked to pay 24.4m JOD's ($34.5m) for the same amount of wheat priced in Dinar that he can still buy from Turkey, Greece, Europe, Asia, S. America, N. America, Russia, Eastern Europe, etc, for same market valued 24.4k JOD's / $34.5k due to Iraq's fake, artificial, 1,000x out-of-whack-with-reality, anti-free market "RV" currency peg (that the "Go RV!" crowd are amusingly calling for without understanding exactly what it is...)
This is why the whole "RV" argument is 100% junk economics that sounds all fluffy and nice when it obsessively focuses solely on a sandboxed "me and my banknotes" isolated bubble, but collapses in an instant when you look at the real-world global flip-side to that adjustment (it would take 1,000x more $, €, £, Yuan, Rubles, etc, to buy new Dinar vs today for every single transaction with Iraq in the future and result in a 1,000x fold split between Iraq vs every other country in terms of real market prices for goods priced in Dinar). Iraq's economy would collapse overnight as would any trust in the Dinar as a serious currency both inside and outside Iraq.
Those people shouting nonsensical "everyone's a winner" slogans are just underscoring a chronic lack of education as Forex is a zero-sum game. For you to sell Dinars for Dollars at a 1:x rate, means someone on the flipside of that equation is going to have to buy your Dinars and sell you their for Dollars at inverse x:1, and no-one on the planet (especially bankers) will pay 1,000x more for something tomorrow than today, any more than you'd sell someone your car for $10k then offer to buy it back at $10m (whilst the same brand of 2nd hand cars were still $10k equivalents in every other countries currency), even if the "RV" were real (which it quite simply isn't - just a fantasy "what if" that got out of control and hijacked by a few conmen and "pied piper" pumpers who've developed a cult following out of empty feel good promises, maths that don't add up, a whole string of excuses, absurd redefinitions of clear-cut financial terms, several years worth of failed weekly predictions and weekly backpedalling)...
"3. If there was any possibility of a 1,000x revaluation, would dinar sellers be so keen to sell their stock to you? Is it possible that they think their mark-up is the best profit they can make?"
Just to add : Read this for the current scale of Dinar mis-selling rip-offs:-
https://www.iraq-businessnews.com/2012/08/06/you-cant-fix-stupid-the-iraqi-dinar-scam/comment-page-1/#comment-110459
Dinar "traders" aren't making millions from holding Dinar, they're making millions from getting rid of them with a mark-up ranging from 20% to a jaw-dropping 1400%!
"5. & 6. The 1,000x rumour has been circulating for many years, but the forex markets have not reacted by driving up dinar prices significantly. On what basis do you believe you’re more “in the know” than the market?"
All advance fee fraud variant mis-selling scams ("give me $1,000 money today and someone else will come along and given you $1m in future") rely on targeting people who feel special about being privy to "secret intel" (ie, manufactured made-up rumors & gossip written by salesmen under different "sock-puppet" pseudonyms) and are new to Forex trading. In real life, if someone said "Canada's $ will jump 1000x on April 29th" (and it didn't), "Russia's Ruble will jump 1000x on New Year's Eve" (and it didn't), etc, after even 5 or 6 of those (let alone several hundred over 6-7 years), under normal circumstance you'd deem them either well meaning but delusional or a fraud & compulsive liar. But "secret intel" is the "glue" that ultimately holds these scams together since it naturally leads to a permanent suspension of disbelief that shuts down a willingness to ask hard questions and expect serious answers beyond the scammer hiding behind imaginary "sources" (as if they're just "waiting" to tell you the "truth"...)
Some are so suckered into it they even see the guru's as "just as much a victim as I am". It's almost like a form of online "Stockholm Syndrome". Same with religion and the old "But he's a Christian and couldn't possibly lie" chestnut about those who hold prayers online one minute then hurl foul mouthed abuse at callers who ask "difficult" questions the next or bring "unwelcome facts" to the call the next 🙂 This is pretty much why people think they're more "in the know" - 1. A false belief in "secret intel", and 2. A sustained suspension of disbelief that leads them to never really question the existence of 1. Some are also so financially desperate they simply don't want to ask any questions at all and withdraw into their "inner world".
As for what the professional serious forex market thinks, try this from XE (most popular FX site and one of the top 100 daily visited websites in the world) : "In 2010, the Central Bank of Iraq announced their plans to redenominate the Iraqi Dinar to ease cash transactions. The intention would be to drop three zeros from the nominal value of bank notes; but the actual value of the dinar would remain unchanged. That would mean that 1,000 IQD (pre-redenomination) and 1 dinar (post-redenomination) would both be worth the same amount in US Dollars."
"6 & 7. Does scepticism of massive gains from the dinar make you angry? If so, and if you think you’re going to make 1,000 times your money, what is the reason for your anger?" Do you seek information that confirms your opinion, and dismiss information that challenges your opinion?"
Two words : "confirmation bias". Many amateur first-timers are simply seeking positive reinforcement rather than the truth. That's why some Dinar-only boards end up turning into cults wrapped up in "appeal to authority" howling / calls for censorship (as a substitute for debate), whereas professional business / professional Forex forums tend to actually talk about the facts of the currency and not obsess about people or personalities.
"We hope these questions will help speculators and potential speculators in their decision making."
Anything that gets people thinking rather than just continuing to "open wide and swallow what the nameless stranger on a forum says" is a good thing! Again - congrats on a great article and a great site.
When I served in Iraq (1st Infantry Div), some people got well and truly sucked into this scam. Some of the talk is so convincing (especially in the earlier years before the recent clearer Iraqi TV broadcasts on the subject). The three mis-selling tactics are mostly the same though:-
Guide to Dinar Pumpers:-
1. Sell "The Enticement" - "You buy a thousand and get a million. For free." Who doesn't like the sound of that?
2. Sell "The Secret"- "RV next week", "I've got a source I can't reveal that says...", blah, blah, You've heard it all before. This mostly relies on accepting something blindly simply because they want to believe it and suspension of common sense (that something as large as banknote changeover for a whole country will be done 'in secret' and pop out of nowhere and that American Internet Radio hosts will know about it before Iraqi's inside Iraq...)
3. Sell "The Stage Props" - These are typically genuine facts that sound great but are irrelevant to the Dinar's value. "Unemployment is down", "oil production is up 2%", "electricity supply more stable", "fewer bombs", etc. "Verify it yourself". You do and think "we'll he's telling the truth about those, so he must be telling the truth about the rest, so the next time he makes a claim, eg, "Iraq's money supply is 3tn Dinar" then I won't bother because I know he's "honest"". This stage is more of a confidence trick and is based on a string of "Straw Men" / old-fashioned bluff.
As said I've been to Iraq. They have TV broadcasts on Alsumuria TV (their Arabic language TV channel) and they talk about the redenomination all the time - explaining how the prices will get lopped and how you will hand in 1,000 current notes and get 1 new note back but it will be worth 1,000x more.
Iraqi's already know the truth - it's American's who've never been to Iraq that don't...
Yup. Superb as ever Barry. The "RV" argument is comical because changing a currency's real international value will obviously affect future purchases of goods in that currency. Same with the "Iraq wants a stronger currency because it plans to export more". That's completely stupid and a*s-backward. Why do people think export oriented China deliberately *undervalues* their currency? This really needs to be taught in schools as it's shocking how many grown adults still don't understand even the basics:-
"Exchange Rates and Exchange: How Money Affects Trade" -
"In the international market today, the supply and demand for currencies and the resulting relative values of currencies can affect the demand for imports and exports. For example, if we have a strong dollar, the dollar is very valuable compared to other currencies; other currencies appear very inexpensive to us. Because we can buy the currency more cheaply, the prices of the country’s products appear lower to us.
An important negative effect of the strong dollar, however, exists for American exporters. When we have a strong dollar, buyers from other countries see our currency as being very expensive; they must give up more of their currency to buy dollars. As a result, the prices of our products appear more expensive to them. Therefore, the quantity demanded of our exports falls. This harms U.S. exporters, such as computer companies, auto manufacturers, and farmers, because they must lower their prices to try to attract demand for their products, resulting in lower profits and possibly forcing some firms out of business completely. The resulting impact of a strong dollar is a trade deficit. Imports rise, while exports fall."
http://www.econedlink.org/lessons/index.php?lid=342&type=educator
Swap Dollar for Dinar and it's all the same. Stronger Dinar = Iraq's export market gets hammered (because Iraq's products will become more expensive and less competitive in real $ values vs peer Gulf states). And as said, an "RV" that essentially demands the entire world pay 1,000x more for all future Dinar & Dinar priced goods would turn the Dinar into a junk currency (like North Korea's) virtually overnight...
In 10-20 years after Iraq has redenominated, some people will look back and think "How the hell could we have fallen for that one?" Ah, well. Have a good day.
The dinar crowd is going to laugh at you guys for your ignorance.
1.Everyone knows that they are going to reduce prices of everything 1000 times at the same time they RV the currency 1000 times. In other words everything will get lopped/redenominated 3 zeros except the currency, which will magically just straight RV 1000 times.
2. They don’t think anyone has to buy their dinar. They have been hoodwinked into believing the Fed will buy back all this dinar and keep it as FX reserves and to buy oil. Then use it for fractional banking!! Fractional banking I tell you !! LOL
3. Dinar sellers are simply making more money so they can buy more dinar.
This is too easy… I should be a pumper.
4. They have been told the big boys don’t like to take a risk. The big boys will all flock in and buy after the redenomination. Cramer said buy dinar!!!
LOL
5. It hasn’t gone up based on the rumor because it’s a worthless currency, who wants it? Once it’s given value, 100,000% RV, then everyone will want it.
6. Their mad because you are a know it all. And no one knows what will happen with the dinar.
7. They seek the truth. The truth from Not-So-Breitling, Krapperoni, Franky, Dinar Daddy and his really good friend Okie Oil Man, Randy, Adam Montana and the many other economic masterminds running dinar sites draining them of every penny possible.
Re: Stew - LOL! Very funny (and oh so true!) 😉
Stew, "Adam Montana's" real name is actually James Wolf. He's a 35 year old high school dropout and a compulsive liar about everything (including his own name his non-existent "Harvard degree").
For a general "who's who" run-down of other Dinar conmen including Lonnie Freels ("OkieOilMan"), Roger Dorman ("DinarDaddy"), (and a 3-part series debunking Montana/Wolf) for anyone not in the know, here you go:-
http://dinardouchebags.blogspot.co.uk/2011/09/pumpers.html
Thanks John
I know who they all are.
I love Sam’s site. I post there often as DaveD.
It’s really no surprise that about half of all the dinar gurus/pumpers/sellers have a history of past scam involvement. The other half are pretty much marketing hacks, most who have been involved in a number of shady multi level marketing schemes.
It’s amazing that all this info is out there readily available about who these guys are, yet the believers defend them to the end…. All while attacking and disparaging the likes of a John Jagerson or any other professional with legitimate currency knowledge.
How old do that is telling people that it was all a scam. The same government agencies including the U.S. Department, BBB, Financial intituciones, FinCEN, Treasury, bank executives, experts in Japan and economies and even Iraq itself from the CBI have been warning the public about how to operate these scammers with their tales of roads that the dinar will increase its value, which is the revaluation morning, blah blah blah, all lies. Their whole scheme scam has always been aimed at an audience, the sucker who does not know anything about economics and investments. And everything to keep their businesses with liquidity. The following phrases as Dianartrade, DinarBanker, Tampadinar, Dinarespr and many more who were dedicated to the sale and purchase of rare coins and gurus accomplices, deceivers of rumors and her backup singers are those who have made money. Everything was a fraudulent scheme well premeditated sales strategies under epeculaciones false, unfounded rumors, manipulated and false news. Everything is evidenced for missing and they think they do not reach their day are arrested and sentenced to so all who were scammed can feel assured that if they can not get their money for at least the scammers do not enjoy it. And if not, may God take confessed. Thanks for the excellent article IBN and hope and many people believe consciousness.
This article, along with others dating back to April 1 of this year by "The Iraq Business Team" make me wonder. If this topic is so useless to discuss, and I believe it is, why as stated in the beginning of this article..... "Iraq Business News is not in a position to give investment advice. Our mission is to provide our readers with the highest quality information on the business and economy of Iraq"......Why does the topic continue to be discussed? For a news agency full of articles that showcase Iraq as a place where the economy is booming like no other on the planet....where every country is investing yet entirely exist on a currency of another country (USA), it seems strange that if there was no news about currency reform to report there would be no reason for an agency as outstanding as Iraq Business News to waste time answering such questions. Just a thought. Those who believe in a whirlwind economic recovery for this country have little time invested in investing. The expectation of Iraq saving the world is as far fetched as the US Stock Market doing the same.
Mike, the article also says ........ hope this information will be useful for key decision makers in business in Iraq, and all who are interested in the country's development, players and people involved in get-rich-quick schemes / scams are not our target readers. 1,000% w/u The expectation of Iraq saving the world is as far fetched as the US Stock Market doing the same. SCAM SCAM SCAM.Enter this link and read as the NP selling dinars compared with the movie thieves HIT AN RUN. Read as ironically one of the vendors dinars in U.S., Dinartrade in their answers mocks its own customers. This article itself leaves a lot to think about. If I were an investor dinars, would run to give me back my money.
http://www.nypost.com/p/news/business/dinar_is_served_0cCgdFyLzXyaf9NGzRYbsN#ixzz24tqQLi1w
Ali,
At dealer DinarTrade, for example, buying 1 million dinars will cost $1,020, according to the website. But selling them back will earn you just $810, said DinarTrade founder Ali Agha, citing the unfavorable exchange rate by the Central Bank of Iraq.
Thanks for the article, great read and I agree with much of it. However, The goal for the IQD is to increase the purchasing power, maintain long-term stability and to be a globally traded currency. Although there is still much work to be done, after decades of war, the CBI, Finance Committee and IMF have worked to improve the political and fiscal outlook by collaborating with senior parliamentarians, and Iraqi financial experts along with their international counterparts. Bloomberg just reported that Iraq’s crude production overtook Iran's for the first time in more than two decades. Last month alone Iraq pumped 2.984 million barrels a day, outpacing Iran’s 2.963 million. Now just as they didn't get to their current value alone, I don't believe they can recover alone. I believe this is all part of a well-orchestrated plan and while the IQD will not be the world's savior by any means, it does present a unique opportunity to rebalance the system and for Central Banks to use this currency as an adjustment tool or stimulus during this global financial crisis.
Many ask how will Iraq be able to pull off a historic revaluation of this magnitude. It's a fair question and one that's hard to answer because there is no real precedence for it. However, there is also no real precedence for the unique investment opportunity Iraq presents, which we have all recognized and is the reason we are here. Previously there have been 14 episodes where a country's real and nominal effective exchange rate appreciated by 10% or more without discretionary adjustments of the parity by the government (over a two-year window or less), leading to sustained real effective appreciation. Since 1960 there have been 25 episodes of large nominal and real appreciations. Usually these revaluations were the indirect consequence of the appreciation of the anchor currency of the peg against other currencies. In Iraq's case, their currency is severely undervalued due to UN resolution 661, a devastated infrastructure and have had to completely rebuild their banking sector. But they have also been on the path to recovery for quite some time. Iraq presents a unique situation and there is a tremendous gap between the current rate and previous values the IQD has held. It has taken almost a decade and it's my belief that after the GOI implements these latest reforms, the recovery process will have reached it's pinnacle and be strong enough support phase 3 of the economic reforms.
Studies have shown that the immediate output response of large RVs is positive, i.e. output growth accelerates, but they turn negative after about three years. For years now economists have been studying ways to raise the value of the IQD and sustain that growth as well. If they were planning a straight redenomination with no significant rate increase they would have never spent this much time studying the long term effects, in-country (and out) security issues, counterfeiting, dedollarization and how to institute a market-based economy where they are respected as a borrow in the eyes of global capital markets. They have been aided in this endeavor by the IMF, World Bank and many other powerful governments and organizations. Iraq has many options. Oil prices fluctuate so a basket peg would not solve the problem. Iraq may peg the currency to the export commodity (PEP). The CBI could set the daily price of IQD in direct proportion to the daily price of a barrel of oil in terms of USD. That would stabilize the price of oil in domestic terms. That's the best of both worlds (fixed & floating) and would also help promote integration into world markets. Iraq has many options and the CBI and Finance Committee has told us they are going to make their move (whatever that may be) in 2012. These next few months could be very exciting and my opinion is that it's in Iraq's (and the world's) best interest to revalue where the Central Banks holding the dinar as a reserve currency would also benefit.
Iraq should peg directly to the relevant commodity which is oil or do a hybrid solution. As I mentioned though, they would have to stabilize the real price of oil domestically. This would be beneficial not only within Iraq but regionally. If Iraq's economy is developed and integrated into the rest of the world it would help if the monetary anchor for Iraq were the same as the monetary anchor for the Gulf states. If they shared a commonality it would boost their trade with eachother substantially. I'm simply stating that Iraq has options and I do believe a drastic change in the monetary system is required for Iraq to accomplish what we believe they will. I certainly don't pretend to have the answers, just offering another point of view. I do think Iraq presents a unique situation though and has come along at a very opportune time as we see the global monetary system struggling. Many institutions and regulators on an international level are all collectively searching for a solution. I have yet to see a reasonable explanation as to why an increase in IQD's exchange rate is implausible but as you said yourself "Iraq business news is not in a position to give investment advice." I would tend to agree with that assessment and I do appreciate the reporting you are qualified to provide. Thanks.
Milndollarbabe: 1) "If the dinar becomes 1,000 times more valuable, it will become 1,000 times more expensive to do business in Iraq. Do you think this would be sustainable?" OK FIRST OFF it wouldnt be 1000 times more expensive to do business post rv. They are dollarized now and dont use the dinar for business transactions it would GIVE them more purchasing power. This is an invalid thought process. 2) "Would you buy dinars at 1,000 times the current price? If not, why do you expect someone to buy your dinars at 1,000 times what you paid for them?" This person has no clue about the history of the dinar and the fact that it was devalued and put on a programmed rate for a temporary period of time until they completed their benchmarks, bad example. 3) " If there was any possibility of a 1,000x revaluation, would dinar sellers be so keen to sell their stock to you? Is it possible that they think their mark-up is the best profit they can make?" Again, whoever wrote this piece is a very misinformed person and doesnt realize how anything works. The dealers didn't BUY their dinar to sell. They have it on "loan" to sell. They dont get to keep their stock post rv. They are in the business of trade. 4.) "Many investment professionals promote their ideas and “talk their book”. Why has no accomplished investor promoted the idea of massive gains from the dinar?" There are some investment companies who have promoted this , but its an exotic currency at the moment and not mainstream. Investment companies are in the business of promoting more mainstream opportunities and are typically not into currencies although they are starting to look at currencies given the markets of today. 5.) "The 1,000x rumour has been circulating for many years, but the forex markets have not reacted by driving up dinar prices significantly. On what basis do you believe you’re more “in the know” than the market?" This is probably the most ridiculous one of all. First off its not internationally traded yet and thats why its not on the market. So, it cant be driven on any market until it is formally introduced and receives article 8 status to be convertible. I enjoy reading well thought out, researched analysis on the idea of the dinar revaluing, none of which this article provides.
The 40 year Ponzi scheme we call fiat currency is almost to an end.
It was a noble experiment The Fed knows that its coming. Bernanke has a plan. Do we know what it is? No but it's coming. No one knows
the trigger point , maybe a currency auction gone bad, maybe a few countries decide at the same time that they are out and call their notes ( Gov Bonds ) When it goes down it could happen overnight or Might be a week , a month a year but the USD will devalue. 16 Trillion national debt and climbing. Fed says the inflation rate for July was 2.4% HA HA, More like 12% So if the US dollar collapses and the IQD holds its value our dinar will be worth more dollars. Those that have dollars will lose!!!!
So does the IBN feel that the world financial events are normal.?
I do not understand how there are still people who insist on wanting gimnacia mix with magnesia, and want to keep others in an illusion. Please!! Enough is enough! of ordinary people want to make entering a risky and unpredictable market, that a lifetime has been present only for wealthy people and do not mind losing all the money invested in one day. The've wanted to bring an alleged investment of this ilk to common people, has only been to a few keep living like millionaires on account of the unwary. Moral, for more oil, gold, gas and Iraq being the most millionaire on the planet, with its famous coin, nobody will be millionaire. Let the fallacy, the broker, dealer or liars gurus, all you do with your comments and speculations is to bring economic woes on anyone gullible leaving his salary at the scammer's pocket. If what they say dinars vendors and experts believe that the nonsense they read elsewhere is true, whatever Iraq could not revalue its currency ever, because not all countries in the world contributing to its reserves would be sufficient to pay course to both investor .. They can put Saddam's skeleton in a museum in a tourist area and that if that would make Iraq the world's richest, Lol and still no bed for so many people. Please stop it, have a little consideration for human sensitivity and neighbor's pocket.
SW... an up and coming dinar GURU
“Maintain long term stability”??? You think a 100,000% RV is stability?
A lop/redenomination which is revenue neutral is pretty stable.
There is a butt load of precedence for the dinar. About 80 times in the last 40 or so years countries with a currency in the same situation as Iraq’s have done a lop/redenomination. It’s nothing unique and Iraq has even specifically said that they will do just as these other countries have done. How do you overlook that often stated fact? “Previously there have been 14 episodes … 10% over two years??? How does that compare to the ridiculous claim of 100,000% or more overnight?
“Studies have shown that the immediate output response of large RVs is positive”. Are you talking bout the 14 10% 2 year increases????????????
“If they were planning a straight redenomination with no significant rate increase they would have never spent this much time studying” That’s a very strange claim (it’s an outright lie by you) considering a lot of countries that lopped.redenominated did exactly that. Discussed and planned for the event for years before implementing it.
You state “Oil prices fluctuate so a basket peg would not solve the problem”, then turn around and claim they should peg to oil???
“Central Banks holding the dinar as a reserve” More Dinar pumper lies.
Finally… ”I have yet to see a reasonable explanation as to why an increase in IQD’s exchange rate is implausible” Then you are a blind man. Iraq has a M2 of over 70 Trillion dinar and a currency in circulation number of over 30 trillion. If you don’t understand why a country like Iraq can’t RV currency supply number like that to $1 then there’s not much hope for you. A number of the delete 3 zero articles have stated very clearly that Iraq has over 30 trillion dinar in circulation now and that will be reduced to 30 billion. That’s a 3 zero lop/redenomination explained perfectly, yet again you refuse to see it.
You won’t get protected here like you do over at Montana’s place… or the family owned site.
Isn't this the website that posted that fake RV on April Fool's Day?
Why should we believe this post now?
Pat. The Iraqi dinar is backed by US dollars. That's what a majority of Iraq's currency reserves are. That is why it is pegged to the dollar.
If the dollar were to lose 1/2 of it's value then the dinar would also lose 1/2 it's value because it is pegged to and backed by the dinar.
Stew you seem very threatened by my humble opinion. I can send you studies done by Yale, MIT and Harvard that lay out the exact scenario I portrayed in regards to the oil or broad based commodoties peg. Also,a 100,000% instant increase was not listed in my scenario was it? Maybe you should focus your sites on Okie or those like him because I am not in that category and recognize that a revaluation of any amount is not a given. A gradual (or otherwise) rise of the exchange rate is not out of the question however.
import and export cost never changed to accommodate a country no matter what the situation, if anything prices have been gouged in Iraq and its ports to help suit the souter and to make money where one can. your "theory" is wrong that prices vary because of the DINAR being low. being a merchant marine myself have seen no cost effect difference since 2002 till now except for cost to ship is on the rise... hence cost and effects on the brighter side for iraq, more they spend the more they will want back. Any country backed by oil reserves "all countries" have a stronger currency, for someone to suggest they, as an Arabic nation, do not want better for their nation, or do not have the ability or resources to expand the nation to a greater gov or their currency is not a Historian first or finance advisor second. Iraq has no where to go but up PERIOD. No one that invest in Iraq for their own good thinks its an over night deal, so STOP suggesting real Investors DO! It will happen, when or how is the question. For someone to suggest HISTORY is incorrect needs to do a REVALUATE themselves. It was done before, and it will be done again. Base anything off the USD is just the beginning, with an economy so messed up as US's its pretty safe to say almost any progress against the USD is a good one. From the worth of Dinar in 2003 till now has already seen profit... so how is it a SCAM? EXPLAIN? I doubled my money invested already and the DINAR hasnt even been through the first stage of any kind of RV. If you didnt invest in it, then leave the ones alone that have... DO your own home work before you talk others out of a possibility when youve already talked yourself out of it. A scam is a Roth IRA in 2008 when people lost half... An investment is a risk, and if you dont want to invest in an opportunity then stop whining about someone elses. With risk is reward, and for some people its worth a few hundred dollars to find out. History repeats itself, its just a matter of time.
Stew, I agree that the IQD is pumped and that there are those who manufacture rumors and distort the history of large currency appreciations to support their own hype. This bothers me as much as it does you. I realize that Kuwait did not "RV" and have tried to explain this to people many times. I've been banned from many chat rooms for trying to expose the truth. I still think there is hope for us to make a profit long term, just not one that is promised by the "gurus." Hope you have a great evening and wish you the best.
SW
I know all about H. Frankle and PEP.
I believe these are all quotes of yours (thanks sam)
4-16-2012 I am very encouraged and I…do believe we are close. Without going into any details, I will say that I have been in contact with an economic counselor who works for the research department of the IMF and he has confirmed that Iraq is moving forward with their currency reform project and among the issues being addressed is the raising of their exchange rate. He will comment no further. In a very diplomatic way he has confirmed the suspicions we’ve had all along and considering the source this is very exciting to hear.
4-22-2012 The signs are all there: Iraq is one of the wealthiest nations in the world, currently operating under an artificial rate, fast on the rise, taking steps in preparation to introduce a new currency (LD’s) that have already been printed and paid for, a government in place that will ensure the stability and security, a banking sector with modern technology, the support and instruction of the IMF/World Bank and the rest of the world which will ensure the success of the project. We expect that very soon Iraq will be boasting a higher exchange rate and WE ARE NOT ALONE!
5-2-2012 I believe it’s in Iraq’s best interest to get this done in May because the tariffs go into effect on the 1st and the USNC High Level Mandate Meeting to release Iraq from Chapter 7 (SC/10490) is scheduled for the 15th unless they call an emergency session to expediate the process. I don’t have any dates or rates…but I will tell you there is a lot of talk about Iraq releasing their new currency (LD’s) and raising their exchange rate very soon. This comes from someone who handles business for a CBI official and also from a contact who’s on the support staff for an economic counselor in the IMF’s research department.
5-7-2012 The current rate of the IQD was never designed to be a permanent fixture. It’s simply a place holder, an imposed, artificial rate that has never represented the countries genuine standing in the world. Iraq truly is a gold mine and we expect to see our suspicions confirmed very soon.
7-13-2012 It's no secret that the IQD's current rate was government imposed and is grossly undervalued ....
Doesn't sound like you are talking about a small 10% slow appeciation.
What is your opinion of the 100,000% claim SW?
As far as the current peg, the CBI has held the value of the IQD against the USD for the past 3 years as a defensive measure that supports the IQD as Iraq rebuilds. The auctions supply the market with dollars and stabilize the IQD exhange rate.
SW... again. Why do you ignore the money supply numbers? Over 70 Trillion m2 and over 30 Trillion in circulation. A $1 rv would give Iraq more currency than the rest of the world combined.
A number of the delete 3 zero articles make reference to the over 30 trillion in circ.
They also make reference to and state that Iraq will do the same as other countries that have lopped/redenominated. They have stated that over and over again. How do you explain that?
So you have one contact that is an Economic Counselor at the IMF and one who handles business for a CBI official?
Your constant claim that the dinar rate is somehow artificial is totally bogus. The central bank web site even states it.
“After the Gulf War in 1991, and due to the economic blockade, the previously used Swiss printing technology was no longer available. A new, inferior quality notes issue was produced. The previous issue became known as the Swiss dinar and continued to circulate in the Kurdish region of Iraq. Due to excessive government printing of the new notes issue, the dinar devalued quickly, and in late 1995, US$1 was valued at 3,000 dinars.”
The numbers prove you wrong also.
Iraq has stated a number of times that they plan to back the dinar fully, 100%, with currency reserves. It’s in the Letter of Intent that accompanies the Stand By Arrangements with the IMF. (surprised your contact at the IMF didn’t tell you about that.)If you take the M2 number and divide it by the amount of reserves they hold, it will be pretty close to the rate. Example. 72 trillion M2 divided by 62 billion in reserves equal 1161. Pretty amazing huh. That formula has been pretty much right on for about 6 years now. Maybe it’s time for you to stop telling that lie.
I suspect that this event only lasted three rounds and if there comes a white lie is full of Yale. sorry, I meant tale. In my country there is a saying that says "if you come in disguise, I can recognize"
Stew what's your financial background (I have a feeling you don't have one) and do you consider yourself more educated on the subject than Greg McCoach who believes there is a chance for profit here?
Iraqi Dinar Revaluation. (Published by Wealth Daily)
How the U.S. Plans to Make Trillions Off the Revaluation of the Iraqi Dinar
U.S. national debt will exceed $14.5 trillion by the end of the summer.
The government has been underwater so long, it has gills...
But despite their desperate condition, the Feds still have a few tricks up their sleeve that will allow them to keep “kicking the can” down the road.
One of the gimmicks they've cooked up to stave the wolves off is becoming more and more evident: Iraqi Dinar Revaluation.
The dinar collapsed after the United States invaded Iraq and toppled Saddam. Prior to U.S. invasion, the Iraqi currency was trading over USD3 to one Iraqi dinar on the strength of the country's massive oil industry.
After the collapse, the dinar was trading significantly lower. At one point, a single dollar purchased one thousand Iraqi dinar.
Speculators began to take positions in 2004 hoping someday, the dinar would recover and the UN economic sanctions would be lifted, allowing the currency to be revalued. Since then, there has been much speculation regarding how and when that would occur.
But here's the really interesting part...
The U.S. Government is the Largest Holder of Iraqi Dinar Outside of Iraq
Does that really come as a surprise?
The U.S. Treasury does not officially list the Iraqi dinar as part of the country's forex reserves.
However, the Treasure does say it did an initial currency swap with Iraq to fund their government and Ministries...
Exactly how many dinars were traded is not mentioned, but it does make reference to “billions of U.S. dollars” traded to Iraq.
About two months ago, Iraqi dinars could no longer be purchased; the recent Dodd Frank bill appears to have legislation related to the revaluation of a foreign currency and preventing mass hysteria.
From what I have been able to gather, it sounds like this plan was originally put together by George Bush, Dick Cheney, Alan Greenspan, and others years ago as a way for the U.S. government to be repaid (read: get kickbacks) for their efforts in Iraq.
Experts speculate the U.S. government received nearly 4 trillion Iraqi dinars at an exchange rate of 4,000 dinar to USD1.
If this is even close to true — and the UN allows Iraq to revalue their currency up to USD1: one Iraqi dinar — the U.S. government would stand to profit in trillions... as would anyone else who speculated on the dinar over the years.
Bush’s statement, “This is a war that will pay for itself,” will be true 10 times over.
The author is obviously Did not do much research before putting pen to paper. Iraq has always had a higher currency than the usd, more than 3x in modern times. So what happens when the US devalued their currency, did all their wealth just disappear? Of course not. And why does Dr. Shabibi expect the iqd to be a foreign currency reserve for other countries? Because the value will stay at 1166? Of course not. Why do the major powers of the world including the US hold billions, and in the US trillions, of iqd. I bet the author didn't even bother to research how much iqd the US holds. A simple FOIA form submitted to the treasury could have provided him that information if he really wanted to present a knowledgable piece..but he didn't.
Iraq is not revaluing it's currency to something it never was. They are going to reinstate their currency to the value it previously held for many many years. They are just going to be given back what was taken from them.
What is most laughable is that someone would be able to write a piece for this site, and have absolutely NO CLUE that the iqd is not traded on forex because it's international status was taken away with the imposition of sanctions. This is the kind of amateur, hack journalism that should be saved for the National Enquirer....or maybe Highlights for kids.
the iraqi dinar currency will be Redenominated according to the news articles coming out of iraq. there are many news articles saying that a 25k note will be = to a new 25 new dinar note that would be considered a Redenomination. after they Redenominate i can see iraqs currency exchange rate rise in value. here are alot of links that back up my saying.
Mahma Khalil, another Member of the Iraqi Parliament and official spokesperson of the Economic Committee says an agreement has been reached about the mechanisms of introducing the new banknotes after a series of meetings and discussions with the CBI Governor Dr. Sinan Al Shibibi.
"According to the agreements, the new bill will be printed by a European company and introduced to the market gradually and in a well-planned schedule to ensure it will not result in shocks and would not have a negative impact on the market," explained MP Khalil. He added the exchange rate between the new banknotes and the old ones would be 1:1,000.
i believe the iraq dinar notes will be exchanged at 1000 old dinars for 1 new dinar
bit.ly/Tx3aFq
bit.ly/j8HjIZ
bit.ly/Pjrjk2
bit.ly/M0ESpB
reut.rs/oDnsHu
bit.ly/pqkcLh
bit.ly/QVksd4
all these articles are saying that after redenomination the dinar will be close to a dollar or a dollar.
If this is a scam someone should tell a certain big 4 bank and to stop giving out bank accounts for future holdings of this speculation. Unless the banks are in on this trickery. While there are pumpers, one would have to step back and see we are in the most unstable global financial crissis ever seen to date. The IMF handing out stand by agreements to Greece Maracco Jordan..also the extension of Iraqs stand by agreement. If you have read the pdf files between CBI and IMF, the plan had been set in motion a long time ago. With the world in duress, it seems applicable to throw out what we think we know and see everything for what it truely is. Calling it a scam does not take into the consideration the devalue of their currency nor does it make sense why the US treasury would be holding a substantial ammount of Iraqi toiletpaper. Nor does the banks giving average Joe bank accounts specifically for dinar if this rv had no validity whatsoever. Paris Clubs and debt forgiveness, I think we can consider Iraq individually, but we can not rule out what is being done globally as well. Oh what a tangled web we weave when we first practice to deceive"
Stew… Your overall tone and aggressive advances toward SW leaves one to wonder if your position is negative toward any hope of a significant return on an IQD currency investment --- ever!
Is my interpretation correct?
I have been trying to learn as much as I can about the IQD and understand the differences of opinions. Ive read the theorys about the money supply going up, the import/export arguments and the arguments about the other countries that have LOP of zeros. And have some questions of my own
DREW - In your assessment of money supply and reserves, are you sure that a lot of that money has not already been allocated to specific projects only to be paid after a revaluation? Such as the money owed to the kurds
The Kurdistan Regional Government has again warned Baghdad that it will stop exporting oil if the central government continues withholding payments to the oil companies operating in the region.
https://www.iraq-businessnews.com/category/oil-gas/
OR
Baghdad hotel The project will cost about $60 million (72 billion Iraqi dinars) and should be completed within three years”
WOULD THAT MAKE A DIFFERENCE IN YOUR FORMULA OF 1161?
2. When comparing Iraq to other Countries that have LOP the zeros, those countries already had a currency in place that was functioning, had value and was being traded. Is that correct?
Barry,
Iraq will be exporting, Oil, gold, gems. Period. Almost everything else they will need to become a functioning country will have to be imported from other countries. They do not have functioning factories to produce "goods" they need. Russia, china, USA.
Your scenario with the Jordan businessman made sense, NOW flip it and plug the Iraqi people in the place of the Jordan businessman and see how they would be able to compete globally? they cant.
They will be exporting oil their sole means of prospering as a country. If you were china, using the exchange rate now..who would you buy your oil from? Iraqi or Kuwait?
SWFloridaGuy - "In Iraq’s case, their currency is severely undervalued due to UN resolution 661, a devastated infrastructure and have had to completely rebuild their banking sector"
Rubbish. The Iraqi Dinar is fairly valued given the sheer amount of Dinar in circulation. Even the IMF openly state that:-
“A report on Monday by the International Monetary Fund (IMF) suggests that the Iraqi dinar is currently fairly valued at 1170 dinars to the US dollar”
https://www.iraq-businessnews.com/2011/03/30/imf-suggests-stable-iraqi-dinar/
I don't know why people keep lying about "the IMF are saying this" when they've been openly saying the opposite all along - Iraq's currency is devalued due to plain and simple inflation no different to anyone else's...
Milndollarbabe - "OK FIRST OFF it wouldnt be 1000 times more expensive to do business post rv."
OMG, this is priceless... So now you think an American business importing 11700 Dinar ($10) goods from Iraq will not be affected by a 1170:1 real move to 1.17:1 "RV" (which would drive up the price of buying 11700 new Dinar from $10 to $10,000 post-"RV"). Even a child of 10 can figure than one out...
Milndollarbabe - "This person has no clue about the history of the dinar and the fact that it was devalued and put on a programmed rate for a temporary period of time until they completed their benchmarks"
And you obviously have no clue whatsoever of why the Dinar devalued in the first place or what perfectly normal "inflation" is... The Dinar develued for the same reason Zimbabwe's Dollar did - Saddam printed too much. No really, it genuinely is that simple...
Milndollarbabe - "The dealers didn’t BUY their dinar to sell. They have it on “loan” to sell."
LOL!!! Most "dealers" do indeed buy their Dinar and often import them through 3rd party countries (like Jordan). They aren't being "loaned" anything regardless of their chronic lies the sheeple lap up. You do realise many have to be registered with the US Govt for both money services and tax purposes and for the latter, post their "profits" (the $ Americans gave them for Dinar (revenue) minus $ spent on buying Dinar from Jordan right? (expenditure)) They openly admit in their tax returns they've been buying them all along!
"Milndollarbabe". That name-tag says it all...
Here are the original quotes from the Central Bank of Iraq. "RV" isn't mentioned once (that label just gets slapped on in pumper forums headlines), "Redenomination" every single time (and explained in such detail the meaning is unmistakable to anyone who hasn't suspended common sense):-
"CBI has announced that it intends to implement a long-planned redenomination of the Iraqi dinar by eliminating three zeros from the nominal value of bank notes." - SIGIR quarterly report, July 30th 2010.
April 13th 2011 – “Iraq’s Central Bank announced on Tuesday that the project of Iraqi Dinar re-denomination consisting of removing three zeroes is close to completion. The re-denomination project is believed to be a strategic plan that will be passed to the ministerial council and Parliament once complete. Iraqi economists believe the re-denomination of Iraqi Dinar will not have a major influence on the purchasing power of the Iraqi Dinar which the government has hopes high on it.”
April 16, 2011 – “An advisor of the Iraqi Central Bank, Dr. Mohammed Saleh appearance that the bank adheres to its policy regarding the removal of three zeros from Iraqi dinar traded at present… To that, the adviser to the Central Bank of the appearance of Mohammed Saleh, said that such fears are unwarranted, and that the economic situation in Iraq is good and able to withstand the application of this project, and that this experience had previously been applied in countries such as Turkey, which has by deleting six zeros from the currency before the period is not too distant future.”
June 24th 2011 – “Iraq’s Central Bank announced on Thursday that it is planning to delete the zeros from the Iraqi currency. The new currency will be printed after deleting the zeros and will include the Kurdish language in addition to the Arabic language. It will bear as well photos of Iraq’s civilizations and patrimony in addition to symbols of Iraqi intellectuals and figures”, Saleh noted. On June 19, Iraq’s Central Bank Governor Sanan Al Shebeibi affirmed during the meeting of independent commissions with Prime Minister Nuri Al Maliki that the bank is preparing all requirements needed to replace the Iraqi Currency.”
July 2nd 2011 – “The draft of the new currency will be put to a vote in the House of Representatives and if approved by Council House of Representatives, the redenomination project will be implemented. New banknotes will be introduced with dual Kurdish language designs. The Iraqi currency change will not have any effect on the international value of the Iraqi dinar and economy“
Nov 28th 2011 – “Deputy chairman of the ICB Dr Muzher Saleh said the bank is working to issue the new currency in addition to coins in both Arabic and Kurdish. This will include a new 50 Dinar bill with a value of $43 [50,000 current note Dinar].”
Feb 21st 2012 – “AKnews reports that the process of removing three zeros from the Iraqi dinar and replacing current banknotes with new ones will begin in September. The announcement, which will see the Iraqi Central Bank (ICB) re-print 30 trillion dinars ($26 billion), was made despite government fear over the project. The move to delete the zeros will reduce the number of bank notes in circulation and simplify Iraq’s payment system.”
“The change that will take place with the Iraqi currency will change the face value of the dinar and not the real value as measured by the value of Iraqi dinar against the dollar and gold,” Sami Atrushi, Iraqi Finance Committee
“Mahma Khalil, Member of the Iraqi Parliament and official spokesperson of the Economic Committee stated that the new bill will be printed by a European company and introduced to the market gradually and in a well-planned schedule to ensure it will not result in shocks and would not have a negative impact on the market,” explained MP Khalil. He added the exchange rate between the new banknotes and the old ones would be 1:1,000.”
Pretty self-explanatory - direct from the people actually in charge of the process with any BS "mistranslation" and "interpretations" by middle-man conmen who twist the facts to suit the sales pitch. Very clear and very consistent. Nothing left to say to those so steeped in denial they'll continue to parrot nonsensical delusions right up until Iraq's redenomination sinks in "the hard way" when the nice cashier gives them $1k in return for their $1k worth of Dinar post redenomination and stares at the in disbelief when they start hyper-ventilating "WHERE'S MY MILLION DOLLARS!"...
Milndollarbabe - "This person has no clue about the history of the dinar"
Henry - "The dinar collapsed after the United States invaded Iraq and toppled Saddam. Prior to U.S. invasion, the Iraqi currency was trading over USD3 to one Iraqi dinar on the strength of the country’s massive oil industry.".
Bobby - "Iraq has always had a higher currency than the usd, more than 3x in modern times"
For those who keep ranting about "the history of the Dinar" and parroting the "Iraq has always been $3" BS, here's a rare dose of the real truth:-
The Iraqi Dinar was introduced in 1932 replacing the Indian rupee (used due to British occupation in WW1) at a rate of 1 Dinar per 13.5 rupees. It was pegged par the British £ then the peg was switched to the US$ at a rate of 1 Dinar = $2.8. In the 1970's, the Dinar "rose" to 1 Dinar = 3.3778 which remained until the Gulf War. This peg value was mostly artificial, evidence of which lies in the fact the black market rate was 6x higher ($1 = 3 Dinars) meaning no-one was willing to pay it's 1:3 *over-valued* arbitrary peg in reality even with Iraq's pre-war (both wars!) oil industry in full flow. This value was using what are called "Swiss Dinars" (due to Swiss printing plates used).
After sanctions, Swiss printing was no longer available and new inferior quality "Saddam Dinars" were introduced and due to massive printing, they were rapidly devalued to below 1000:1 via the same ordinary chronic inflation that affects many other countries. Between October 15, 2003 and January 15, 2004, the Coalition Provisional Authority issued new Iraqi dinar coins and notes, with the notes printed using modern anti-forgery techniques, to "create a single unified currency that is used throughout all of Iraq and will also make money more convenient to use in people's everyday lives (and partly to get rid of Saddam's face on the notes / coins as a political measure). Old banknotes were exchanged for new at a one-to-one rate, except for the Swiss dinars, which were exchanged at a rate of 150 new dinars for one Swiss dinar. This is the real 150:1 "RV" process related to the "old $3 value" that's already has been done and took place 9 years ago! The reason why the Kurds exchanged "Swiss Dinars" for NID's (New Iraqi Dinar's) at a rate of 150:1 was because their currency wasn't inflated whereas the Saddam Dinars exchange 1:1 was because they were inflated.
The sad truth is, most people who use this 1 Dinar = $3 of the old Swiss Dinar as an "RV" benchmark don't even realize that the "RV" old-to-new value correction they're waiting for already took place in 2003 when holders of the old Swiss Dinar changed them up at a rate of 150:1 for the NID (New Iraq Dinar)! ie, they were given 150 New Dinars for each old Swiss Dinar they handed in, whereas the Saddam Dinar were exchanged only for 1:1 for the NID to correct the value discrepancy between the old 3:1 Swiss Dinar (long been demonetized) and they never never had a 3:1 value NID notes (which everyone owns today).
I'll repeat that : The over-printed NID (and Saddam Dinars) have never ever had any exchange rate even remotely approaching 3:1. Only the pre-1991 "Swiss Dinars" did, and that 150:1 "RV" already took place back in 2003, long before most modern Dinar speculators even bought NID's post 2003. The only way of getting back to near parity vs the $ is via a "lop" / redenomination. There's simply no 3:1 value to "restore" the Dinar to via an RV because the NID's never had that value in the first place. Simply looking up what the value of the Dinar was in 1980, 1970, 1960, etc, is as utterly meaningless as doing it for any other currency that's since been devalued via chronic inflation. It's like saying Zimbabwe will "RV" and everyone will become a quadrillionaire purely because the Zimbabwe Dollar was worth more under the British (back when it was called Rhodesia). It's complete and utter nonsense and nothing more than attempted historical revisionism and confused nostalgia fantasy economics.
The NID's people hold now - have never ever had a value of $3 since they were introduced in 2003 and have already had their value corrected via the 2003 150:1 redenomination of non-inflated Swiss Dinar vs inflated Saddam Dinar (and NID's). Iraq may well issue a further redenomination in the future, to bring the zeroes back in line with other currencies (a "lop"), but the "RV" people many are waiting for of the old widely used Swiss Dinar to the New unified Iraqi Dinar already happened 9 years ago... Unless your Iraqi notes have a picture of Saddam Hussein on, they've never been at $3. The Dinar was devalued to under 1000:1 even back in 1997 - under Clinton and before the Kosovo war broke out, so those saying "it only fell when the US invaded" are quite simply bald-faced liars who despise observable reality.
Most of this "the Dinar is worth 3:1 vs the Dollar" is nothing more than confused nostalgia. Like people pointing to $50 gold prices under Nixon and saying "Oh the $ must RV by 30:1 because it was worth 30x more vs gold 30 years ago" whilst ignoring the very obvious massive increase in money supply & inflation that's precisely the cause of the devaluation in the first place. You cannot take modern NID's with a whopping 72tn circulation back in time and compare them when there only 30bn Dinar, any more than you can take the modern day $ back to the pre-WW1 gold standard.
There is no "hidden" or "missing" value surrounding the Dinar's 1170:1 value and never has been. It's because it's overprinted. And the 3:1 ratio "correction" people are waiting for (which happened under the old Swiss Dinar notes) already occurred 9 years ago in 2003 with the 150:1 redenomination before most Dinar holders even bought them! All you people are doing is parroting half-truths and outright lies & personal fantasies told a few pumpers who themselves do nothing but pick the world's weakest currencies and try and convince people that devaluation that was caused by perfectly ordinary inflation is somehow "undervalued hidden wealth" (look at the way some are trying the same "pump and dump" scam with the Vietnamese Dong (which has a money supply of a staggering 1 quadrillion absolutely no different to Zimbabwe or 1920's Germany)) that 99% of the population are all supposed to be "too stupid to see". That's as massively egotistical & vain as "investments" get...
Hahahaha! I knew it wouldn't tkae long for the Dinaraholics to "explain" why the article is "wrong" with a bunch of confused made-up gobbledegook even they don't understand! LOL.
People who argue Iraq will "RV" 1000:1 without redenominating are basically saying the same as "America will RV the $ vs the rest of the world because there's some oil in Texas, and George Bush wanted it and the $ used to be stronger back in the 60's, and the economy's in trouble and the moon landings were faked, and even though $499 Dells which currently cost €399 in Europe (at €1:$1.25 rate) will end up with new price tags of €399,000 (due to €1:$0.00125 new rate without redenomination / lop), Europeans will still happily pay that making American's 1,000 richer (because its the fractional reserve man) even though Sony & Asus laptops imported from Japan & Taiwan to Europe will still cost €399!
Duh! Is that a giant elephant in the room there! LOL. It's so stupid it debunks itself... The whole Dinar selling thing has long moved into being an brainless, unthinking, automaton cult where people just throw around recycled slogans and already debunked conspiracies whilst ignoring the obvious - raise your currency by everyone else's on the planet 1,000x in real terms, and your currency and exported goods instantly becomes 1,000x more expensive for everyone else on the planet to buy in all future transactions!
In a way it's a good thing the Dinar scam victims parroting their puppet-masters sales pitch are hiding behind non-identifiable such names as "SWFloridaGuy" and "Milndollarbabe". The last thing you want in 5 years time is for a future prosective employer to Google your name and see their applicant lacks even basic 5th grade maths skills!
[b]Billuke said[/b]: "Why should we believe this post now?"
The post is a series of [i]questions[/i] - what's to believe?? It's not saying anything!
[b]Milndollarbabe said[/b]: "This is an invalid thought process."
What on earth is an "invalid thought process"? Sounds like the sort of meaningless language a creationist or conspiracy theorist would come up with to distract people from the facts.
[b]Milndollarbabe said[/b]: "The dealers didn’t BUY their dinar to sell. They have it on “loan” to sell. They dont get to keep their stock post rv. They are in the business of trade."
This is even worse! So they borrow 1170 dinars, sell them for $1, then have to find $1,170 post-RV to re-pay the 1170 dinars - what a brilliant business model.
Funny how all the naysayers quote articles that are a year old and written by the goi....I wonder why nobody quoted the articles from last WEEK that used the words revalue....dr shabibi made it very clear that dinars held outside the US will be held by central banks as a reserve currency. They will be redeemed for oil credits from the cbi. How do the lopsters explain dr shabibi stating that the 25 k notes will be used for large transactions between banks? Not at 1166, that's for sure....if you guys don't have some cash to buy a bit of iqd, deliver some pizzas for few nights, instead of trying to make sure nobody gets rich without you.
Rally2invest - "Barry, Your scenario with the Jordan businessman made sense, NOW flip it and plug the Iraqi people in the place of the Jordan businessman and see how they would be able to compete globally? they cant. They will be exporting oil their sole means of prospering as a country. If you were china, using the exchange rate now..who would you buy your oil from? Iraqi or Kuwait?"
Rally2invest, the price of oil is set by OPEC and is the same for all member countries (including Iraq). Only quota's differ. Iraq's oil to China isn't going to be any different to Kuwait's in $ value no matter what they do with the Dinar because prices are set by OPEC in $ NOT IQD's (hence the phrase "petro-Dollar"). To give an example, earlier in the year when the USA was buying oil at a rate of $105/barrel from Iraq, it was priced exactly the same $105 as Kuwait, Nigeria, Qatar, Saudi Arabia, & UAE. And that in turn was priced close even to non-OPEC South American countries, eg, Mexico ($103.6), Columbia ($103.2), etc, (which are 2% cheaper mainly because they're geographically closer. As far as China is concerned there is no difference between them (which is why it already buys from both).
Currency movements have little to no impact on oil export prices set by a trans-national cartel at all, since they're all priced in $ and at the same rate across OPEC. That's why I used the wheat example as an example of Iraq's real Dinar economy (and not just non-Dinar petro-dollar exports). Even if oil were priced in Dinar, if the Dinar increased in real value (driving up the real exportable price of oil but only for Iraq), countries would simply buy it elsewhere in non-Dinar (and given that Iraq makes up just 2.75% of global oil supplies they can hardly hold the world to ransom as a monopoly). That figure alone also shatters the myth that "oil will back the Dinar and Iraq will save the world!".
Iraq's exported oil is the same OPEC-set price as Kuwait's and all other OPEC countries. In fact, you can see for yourself exactly what monthly prices the USA pays to import oil from around the world (Iraq is in 2nd to right column under "Total OPEC" - absolutely identical to Kuwait, UAE, Iran, etc, as explained in the footnote):-
http://www.eia.gov/petroleum/marketing/monthly/pdf/pmmtab21.pdf
Same with the absurd "RV" conspiracy theory claiming "Iraq is secretly supplying the USA with oil at $1.50 per barrel and the Fed will sell it at market value and use the difference to buy back all the Dinar!" - this is total BS that can be traced back to a pumper mis-translation / confusion with an Iraqi document talking about oil services contract fees of $1.50 per barrel (the "cut" that Iraq pays Western oil companies per barrel sold in exchange for future oil field exploration - it's like an "exploration royalty"). The pumpers "secret Fed arrangement" delusion is also debunked by Iraq's GDP figures - if oil really were "sold to the Fed at $1.50", Iraq's GDP would be 60x smaller than it is...
And even if the delusion was true that Iraq is selling oil for less than half the price it takes to dig it out of the ground (making a constant loss - great business sense there...) and giving it all to the US Fed (like a charity) who in turn will magic up 100x wealth which they will give to Americans with Dinar banknotes (like another charity), back in the real world, only 1/4 of Iraq's oil goes to the USA (675k per day) and only 15% of America's oil imports come from Iraq (675k out of 4388k barrels per day)! Given 675k barrels per day ($67.5m (at $100 oil price) x 365 days per year = $24bn oil revenue per year. To try and use that to match up Iraq's 72tn (72,000bn) total money supply close to the $ would take every drop of oil sold from now until 5012AD to back without a redenomination (and Iraq's oil reserves will run out long before even the first 3% of those years are up...) - and that's assuming they never create a single extra Dinar and their population and domestic demand doesn't grow between now and 5012AD over the next 3,000 years...
Even if Iraq used ALL it's 1.9-2.0m barrels exported (they use approx 1/5 to 1/4 of all produced oil for internal consumption) revenue to "back" the IQD to try and make it 1,000x more valuable with redenominating, that's still only $70bn oil revenue per year, which would still take until 3000AD-3040AD of oil sales (again it would run out centuries before that - before even 2175AD) just to back today 2012's money supply (again assuming they never print a single more Dinar or use more domestically / have any population growth over the next 1,000 years)... It also overlooks the obvious that although Iraq exports $70bn they also import $55bn per year (not all from the USA) so obviously it's impossible to spend even half of petro-dollar income backing the Dinar when a large chunk flows back out to import other stuff from other countries... Iraq's overall net balance of payments (exports - imports) gain is only about $15bn, and you aren't going "magic" that net national annual wealth to cover an equivalent $72,000bn (and growing) even with 500 years worth of 10x Iraq's worth of oil just because some Dinar "investors" run scared at the sound of "redenomination"...
I know you didn't bring these claims up specifically - but so many gullible people fall hook, line and sinker for such stupid claims regarding Dinar vs Iraqi oil wealth (and act like Iraq is the only oil producing country on Earth with a weak currency - Hint: take a look at Iran, Indonesia, Kazakhstan, Columbia, Nigeria, Venezuela, Angola, etc) and unthinkingly regurgitate such wild conspiracies elsewhere so out of whack with reality (purely because they want to believe in them regardless of how untrue they are) that I thought I'd mention it just as an example of the level of desperation some people have at denying the obvious.
The whole "RV" thing is ultimately like watching someone watch a see-saw with a 1kg weight on one end and a 1,000kg weight on the other causing it to sink in the mud, and then ask "Forget about physically removing the 1,000kg weight [redenomination], why can't both ends be up in the air equally at the same time without changing anything else simply by writing "1kg" on the 1,000kg weight with green crayons and all agree to pretend it's just 1kg and that we might remove it for real sometimes over the next 5,000 years?"...
I'm not aiming this at you personally, but in my experience, people who run around shouting "The secret to the RV is the oil and fractional reserve banking!" the most, are usually the ones who understand currencies, banking, international trade, OPEC and the world in general the least (as is painfully obvious by some above comments)...
Bobby - "dr shabibi made it very clear that dinars held outside the US will be held by central banks as a reserve currency"
Just like every other currency on Earth then... You act like countries holding foreign reserves was only just discovered yesterday or is something 'special' and 'unique'?
Bobby - "How do the lopsters explain dr shabibi stating that the 25 k notes will be used for large transactions between banks?"
Same reason the USA reused large $10,000 and $100,000 denomination banknotes for inter-bank transactions after they were demonetized for public use. If you think you'll be personally given $25,000 for every 25,000 Dinar note you have, you're in for quite a surprise...
"Bobby... every country that lopped uses the term revalue. These are all examples from news stories."
“Turkey carries out currency revaluation.”
“In response to rampant inflation and ever-confusing prices, Turkey revalued its currency in 2005, dropping 6 zeroes. One million Turkish Lira became 1 Yeni Türk Lirası”
“Russia plans to revalue the rouble”
"VENEZUELA TO REVALUE CURRENCY"
"note: in 2007 Ghana revalued its currency with 10,000 old cedis equal to 1 new cedis"
"Zambia revalues kwacha by removing three zeros"
"North Korea revalues and replaces currency"
These are all lops.
I could go on and on but I hope you get the point. Go to a search engine. Type in the name of any country that lopped along with revalue, currency, and zeros.
Ex. “Turkey revalue currency zeros”
EVERY country that lopped will have articles that used the term “Revalue” do describe it.
Show me an article where Shabs said they will use 25K notes for large bank transactions. It doesn't exist. The only people saying that are dinar scammers.
LOL see ya at the bank, hmmm bet the non dinar believers, if the truth were know, has just a lil bit of iqd hid under their matress, if u dont believe in a RV why are ya trying so hard to convince everone else, why u even wasting your time here? Shouldnt u be mowing the yard or something
From the Central Bank of Iraq.
“After the Gulf War in 1991, and due to the economic blockade, the previously used Swiss printing technology was no longer available. A new, inferior quality notes issue was produced. The previous issue became known as the Swiss dinar and continued to circulate in the Kurdish region of Iraq. Due to excessive government printing of the new notes issue, the dinar devalued quickly, and in late 1995, US$1 was valued at 3,000 dinars.”
IN 1995 THE DINAR WAS VALUED AT 3000:1
When will pumpers stop pushing the lie that the US or UN or IMF or some other boogieman magically devalued the dinar overnight? Better yet... when will people stop falling for such nonsense?
bucks: "LOL see ya at the bank, hmmm bet the non dinar believers, if the truth were know, has just a lil bit of iqd hid under their matress, if u dont believe in a RV why are ya trying so hard to convince everone else, why u even wasting your time here? Shouldnt u be mowing the yard or something"
Translation : "Shut up because your truths frighten me and I cannot debate properly" 😉
Lol lol kev
kev - LOL! Agreed. "You must have Dinar under the mattress" seems to be an almost Pavlovian kneejerk response churned out by people who bought Dinar who hate reading anything by anyone who disagrees with them and expect every forum on the Internet to be little more than a comfort blanket... It's almost as if they're trained to say it at some special "Pumper education centre" as a "response" to anything they have no real response to 😉
All the best, John.
Yup. At the end of the day (in billions - Q2 2012):-
Kuwait's money supply:-
M0 = 1.22bn KWD's
M1 = 7.40bn KWD's
M2 = 29.2bn KWD's
GDP = $176.667bn
Population = 3.6m
Money supply per economy size (GDP) = 0.165x
Money supply per Kuwaiti = 8,111 Dinar
(Kuwaiti central bank stats available here) :-
http://www.cbk.gov.kw/cbkweb/servlet/cbkmain?Action=mtbl&archive=201206&tbl=RM02
---
Iraq's money supply:-
M0 = 30,246bn IQD's
M1 = 60,119bn IQD's
M2 = 72,028bn IQD's
GDP = $143.767bn
Population = 31.1m
Money supply per economy size (GDP) = 503x
Money supply per Iraqi = 2,316,012 Dinar
---
when you have 500x more money circulating than the size of your economy and 2,500x more than your neighbor whose economy is actually larger, then that is plain and simple chronic inflation. Iraqi's are all "multi-millionaires" in the same way Turks were all "billionaires" and Zimbabwe's citizens are all "trillionaires". Iraq's economy isn't "undervalued" at all - just massively diluted underneath all those overprinted Dinar. No amount of wishful thinking, twisting word definitions of redenomination vs "revalue" around or playing around with the Iraqi Dinar's peg and pretending it's 100,000% more valuable than it is will match that gaping difference up or cover up that Iraq's been experiencing the same chronic inflation thing Germany did post-WW1.
FACT : The Iraqi Dinar is worth >2,500x less than the Kuwait Dinar because it has been overprinted by more than 2,500x times (both per person and per economy) - all aspects (banknotes (M0), bank deposits (M1) and total currency created (M2)... God knows why some people have turned it into a cult of confusion...
1. If the dinar becomes 1,000 times more valuable, it will become 1,000 times more expensive to do business in Iraq. Do you think this would be sustainable?
Answer: This is sustainable because the current rate of the dinar in Iraq is artificially low. The rate was $3.50 during and prior to the Saddam Hussein regime. It was lowered intentionally by the UN in order to drive out the profitability of terrorism. I would ask this Question: In reducing the value of the dinar by 1000 times (or more, actually), why didn’t everyone flood into Iraq to invest and buy? Iraq’s economy should have boomed with everything so cheap, right? Yet that did not happen. We may therefore safely state that the premise of the poser’s question is inappropriate. The reason it is inappropriate is that the current rate is artificially low and it is NOT internationally tradable. Bottom line: investment in Iraq is currently made in DOLLARS, not dinars. End of argument.
2. Would you buy dinars at 1,000 times the current price? If not, why do you expect someone to buy your dinars at 1,000 times what you paid for them?
Answer: I will probably buy dinars at 1000 times the current rate because I believe that eventually (within a couple of years) the rate will reach $3.50, meaning that I will triple (plus) my investment again.
3. If there was any possibility of a 1,000x revaluation, would dinar sellers be so keen to sell their stock to you? Is it possible that they think their mark-up is the best profit they can make?
Answer: This guy is ignorant! Sellers of dinars make a COMMISSION on the sale regardless of the rate. Their markup will remain the same WHATEVER the rate! Their profit is the same WHATEVER the rate! Duh! They are money exchangers. They are not in this for profit ON the rate.
4.Many investment professionals promote their ideas and “talk their book”. Why has no accomplished investor promoted the idea of massive gains from the dinar?
Answer: There are a number of people who have spoken affirmatively about the dinar as an investment. The poser of this question has not taken the time to find them. One was on TV last year claiming that it would be the best single investment in a lifetime (!) and he has a regular TV investment show that runs DAILY! He dropped the topic for some reason. We can only guess what it was, but I presume that he was told to “lay off” on dinar talk. Therefore we might not be surprised that there is little more among the normal investment community on this issue. I might add, incidentally, that I’ve been told that Trump has $30 million in dinars and that the Clintons have over $2 million in dinars. I have no reason to doubt this since the former was printed in USA Today over a year ago. Therefore, let’s ask the poser this question: If this is good enough for Trump, why isn’t it good enough for you?
5. The 1,000x rumour has been circulating for many years, but the forex markets have not reacted by driving up dinar prices significantly. On what basis do you believe you’re more “in the know” than the market?
Answer: Once again the poser is ignorant. The dinar is NOT traded on the open market, including the FOREX! Therefore, the premise of the question is false. Second, since all dinars are initially sold from the CBI, the CBI is therefore in control of supply. With a very limited market (physical dinar dealers only) it is quite easy for Shabibi to control the price. There is NO SPECULATIVE MARKET FOR THE DINAR! DUH!
6.Does scepticism of massive gains from the dinar make you angry? If so, and if you think you’re going to make 1,000 times your money, what is the reason for your anger?
Answer: I am not angry with people who are ignorant.
7.Do you seek information that confirms your opinion, and dismiss information that challenges your opinion?
Answer: Absolutely not. I have welcomed challenges from dinar investors and have answered all who have dared to approach me on the issue. In addition, I take pride in being able to state without equivocation that we do not “bury” articles just because they appear to refute our position. In fact, we welcome ALL articles and deal with them just as we do anything else: honestly!
It's nice to see there's a place for some of the scorned to try to reclaim lost self importance. The "axe to grind" crowd just can't get over the fact that they were possibly hoodwinked and now their fragile ego's have squashed. Get over yourselves and quit crying like babies. It's a non guaranteed investment just like any other,if one chooses to listen to others opinion(such as yours) so be it,they're choice. No one has ANY REAL answers,only opinions.