"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 23rd September 2013 at 13:13 #

    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 23rd September 2013 at 14:16 #

    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 23rd September 2013 at 17:11 #

    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.