By Omar al-Shaher for Al-Monitor. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.
Two Iraqi parliamentary committees monitoring fiscal policy in Iraq have held two contradictory positions on the Iraqi currency “reset” project, which would delete three zeros from the currency. There has been much debate about the project's feasibility and the date of its implementation.
While the parliamentary Economic Committee believes that the deletion of three zeros from the Iraqi currency would strengthen it, the parliamentary Finance Committee fears that this project would open the door to counterfeit operations.
In a statement to Al-Monitor, Mudher Mohammad Saleh, former deputy governor of the Central Bank of Iraq, warned against the consequences of such a step if it is not implemented at the appropriate time.
Abdul Abbas Shayya, a member of the Economic Committee in the Iraqi parliament, told Al-Monitor, “Reforming the management of the Iraqi currency now requires the deletion of three zeros. This has been endorsed by the parliamentary Economy and Investment Committee."
Shayya, an MP for the State of Law Coalition led by Prime Minister Nouri al-Maliki, added that the Economic Committee "asked the government and the Central Bank to quickly replace the current Iraqi currency with another that is less [in value] by three zeros."
"The Iraqi currency is weak, and the money supply has amounted to multi-trillions because of the existence of these useless zeros," he said. "The country will witness a significant increase in oil revenues, financial earnings and high budgets. Thus, we need to print new banknotes, as estimated by the Central Bank."
I guess this is more open discussion of the 100,000% RV?
It's so nice of Iraqi officials to let investors world wide know of this phenomenal event.
eating some crow huh stew better artical were not far from 100 dinars equal to 100 dollars!! yep moon said exactly what dinar dealers had been saying all the time we will return iraq to they`re former international status equal to where they were prior to the sanctions being applied in 1990 man stew you fell off your chair when you read that i bet!
Coming soon, the movie... 3 ZERO OUT.... With 3 special actors .... brokers, dealers and gurus. With the special effect, SCAM SCAM SCAM in 3 DDDDinar.
Ohhhh! Sorry, second actor THE inVERsTors ....lol with the first paper ... The dinars.
Here's my question, if no bank in the USA deals with the Dinar, and if Iraq were to drop the zeros and print new money, how would anyone be able to exchange what they have?
Some of the dealers will switch into reverse. If they have the ability to get the dinar back to Iraq for exchange they will buy it back from you. If a million dinar are worth $860, I’d say they will probably offer about $500 per million. They will probably offer less for small denominations because of higher shipping cost. The people who fell for that ridiculous part of the scam are going to lose the most money. They have paid around $3000 per million and will be lucky to get $500 back.
Breitling will be a popular guy for pushing that line of crap.
hey to those who hold the IQD your only waiting on iraq to post a INTERNATIONAL EXCHANGE RATE stew stop lying to folks! if iraq decideds to make the dinar worth .10 you will make a profit the only way iraq get`s these notes we hold is too buying them back (exchange rate) stew i`ve watched you a you cherring squad say all types of untruthful statements about this investment moon said it best guy`s and you can go the un.org and read it for yourselves quoting ban ki we recognize iraq is no longer the regime under saddam things have changed we find it necessary to restore iraq to their former international status equal to where they were prior to the sanction being applied in 1990`s! i`ve asked banks from here to the moon what do they consider a countries INTERNATIONAL STATUS it`s they`re CURRENCY! i can`t believe iraq business news let`s you guy`s spout the lies about the IQD on they`re business site!
2collectg please stop emotional tantrum this is serious business site!
Amazing collect. There were hundreds of articles for the last 4 or 5 years about the U.N. removing Iraq from Chapter VII. There have been dozens apon dozens of articles recently where Ban Ki-moon has spoken about removing Iraq from Chapter VII. So just before releasing them from Chapter VII Ban Ki-moon comes out and says they will restore Iraq’s international status. You don’t think he’s simply referring to releasing them from Chapter VII? You somehow think that statement refers to a 100,000 to 300,000% RV?
You epitomize the statement: For a man with a hammer everything looks like a nail. For a man with dinar everything looks like a RV.
Collect you have done nothing but lie and lie about this currency in the hopes that it will drive more poeple to join the ranks of you fanatics and lunatics...and for what? To drive up sales? Are you profiting from this scam? Are you an alias for a self-purported "guru"? News sites have repeatedly said to stay away from the dinar as an investment and to avoid any information that is obtained from people with "high sources".
I find it interesting that the nay sayers here follow this investment as much as the speculators do, all the while screaming SCAM SCAM SCAM but never giving any real substance to their argument. Makes one wonder if they are paid misinformers. I also find it interesting how much news about the IQD rising in value never makes it out of Iraq. If you have no vested interest in this investment why do you follow it so closely?
Thanks for bringing the "real substance" to the discussion Parabellum.
I have shown, with links, that if Iraq was to RV to $1 they would have 6 times more currency in circulation (value)than the rest of the world combined. You think that's not "substance"?
Hundreds of articles from Iraq have talked about redenominating, or deleting 3 zeros. They mean the same thing. Redenominations have happened about 80 times in the last 40 years, so about 2 per year. Iraq has even stated they are doing axactly what these countries have done. Even naming countries that have redenominated as examples. A redenomination is neutral event. So it’s not a big deal if they openly talk about, even for years, just as Iraq has.
A big revalue as the scam calls for has never ever happened, and never will happen because it’s economically impposible. Countries lie and deny and hide from the public as best they can 1% or even 1/2% increases in their exchange rate because they don’t want speculators to take advantage of it. The scammers are trying to get you to believe that Iraq is openly discussing a 100,000 to 300,000% RV of their currency for years now. Honestly. If you are not bright enough to see that in itself is a huge red flag, then you probably deserve to be separated from your money.
"In equivalent amounts", if you don't know where that comes from Stew you need to do more research on the matter. What it really boils down to is you are no more than a speculator yourself, just on the other side, that thinks he knows exactly what is going to happen, when really nobody knows.
What a ridiculous thing to do. Throw up a silly 3 word quote that could be applied to thousands of things and act as if it somehow wins a debate.
You didn’t answer either one of my questions. How do you address Iraq having more currency than the whole world combined and how do you reason in your mind that Iraq is pre-announcing to the world a 100,000 to 300,000% RV?
As for your silly quote. I have read Iraq’s banking law and it’s 100% irrelevant if they do a redenomination. Countries like Iraq issue new series of currency quit often to combat counterfeiting and other issues. Kuwait has done it a number of times. That wording is for a simple currency exchange and it will have no bearing on whether they redenominate or not. Iraq copied and modeled their banking laws after that of many other countries. They aren’t inventing the wheel. Redenominations have happened in many many countries and I bet many had the same wording in their bank law.
That's what blind hopefuls do, Stew. They refuse to look at what is factually presented to the and then shake their heads and claim that "the naysayers haven't presented one shred of evidence" and etc. Here's the irony to that; We really do not need to present any more facts other than every pumper and pro-RV informant who has provided "intel from a credible source" has been completely wrong and 100% false each and every time because these people simply refuse to follow simple world economics and monetary systems.
And another thing, perhaps all the naysayers are people who actually were invested at one time but then saw how bad this "investment" is. An investment is an informed deciscion based on facts. But these people are investing in the dinar based on lies and misinformation. THAT IS WHY NO BANK IN THE UNITED STATES OF AMERICA deals in the dinar.
Just common sense, before, they were buying Dollar, selling Dinars very cheap because of sanctions, now if they revalue Dinar in equal status with Dollar(1=1), they would get their billions of Dinar back to their foreign reserve and could pay to investers from around the world who wants to invest in Iraq, hence, BE POSITIVE, Ameer.
Dear God, are people still falling for the "RV" scam?!? Unbelievable...
I'm also not surprised "2collect" is here pumping his heart out. (He's the one who on another topic who couldn't tell a million from a billion (even with calculator)) 🙂
It doesn't work that way Ameer.
They can't put dinar in their foreign reserve, hence the word FOREIGN. You can't back your currency with your own currency.
FX reserves are assets. That's foreign currency, gold, silver, other liquid assets. (no, oil is not a liquid asset)
Curreny issued is a liabilty.
Big difference.
OMg Please don't go around spouting guru rhetoric and lies, it justmakes you look phoney Ameer. That is not how currency works, as Stew just pointed out. Besides, they handle ALL of their transactions in US Dollar (or just about). Before you would see any major movement come out of Iraq, they would have to be totally dependent on their own currency.
SORRY, i misunderstood the difference, but, they auctioned their currency to buy Dollars and US govt. allowed to buy instead of declaring wrong doing to keep their currency in US, makes some sense and similar to money laundering and that is US govt. would never allowed, people(agents) selling their currency(Dinars) in big profits, and there is no restrictions by authorities!And fooling people in this economy!In this senerio, Govt. should step forward about this scam, if it is. Ameer.
Why are people taking time to bash the Dinar? Why are they not minding their own business? Why are they taking time out of their own day to comment on something they haven't invested or even intend on investing on? Why are they posting comments without proper research? What is the point to this? If it's such as scam, go on about your day and leave these people invest in whatever they want to. And don't even spew any excuses such as "we care about other people's investments. We want to inform investors everywhere!" That's a load of bull and it needs to stop. You have nothing better to do, period. Why should it matter to you??? Are you afraid of the possible outcome? Are you afraid they might come out making a lot of profit? I don't understand the reason behind the bashings and negativity? Mind your own business lads.
Ponce - Why are people taking time to bash the Dinar? Why are they not minding their own business?
Why do Dinar "investors" do nothing but endlessly question other people's right to post whenever the scam gets called out and they have no other answer?... This isn't a censorship-heavy pumper-run forum with a cult-like "hive mindset" to sustain. Your post smacks of pure fear.
lol Barry....guess they're not comfortable when people come and pull back the cover on their house of cards they've built. I wonder if people had this much reaction to truth when they first presented the theory of the world being round.....
This is the mindset of people who get scammed. After this thing falls apart they will still not want to hear the truth. That they were scammed and there never was one little bit of a chance this thing would pay off in a substantial way.
They will continue to support the same crooks that have taken their money. Some gurus will simply disappear. Some will stick around for a little while and make up lies about why this happened. They will claim a big RV was supposed to happen, but Obama, or the CBI, or Maliki, or the IMF or someone screwed them over.
One thing they will never do is to admit the "loppers" were right the whole time.
The thing is all your negativity is unfounded and you haven't done the proper research. You are going by what your "gut feeling" is telling you about it. The fact remains that the country's economy is booming. Yes, the government and politics are not stable. I got it. But, it will eventually stabilize. They have the enough currency in reserves and the gold to back it up. 500 currently known sources of oil with billions, if not trillions of oil. On a new geo survey they stated they have found 2,500 other untapped oil sources. The articles are out there. I wish I had the time to link them to you, but I'm extremely busy with this military career I am in. So take as it may, this will RV in due time. They have the ability and potential to explode. I am not a guru by any means. I sweat and break myself a little every day for the paycheck I bring home. So do your due diligence and do the research yourself and stop wasting your time with the negativity. I understand that you must feel a sense of superiority because you've made in what you perceive to be "the right choice" and not invest. Good for you. Pat yourself on the back and be on your merry way and let people that want to invest their $200, which I can blow away in a day on some really useless stuff. If the Dinar has a low percent of chance, I'm taking the risk. Why does it bother you this much??? I don't understand it.
Secondly, currency is currency and the only scammers are the dealers that promot this as a get rich quick scheme. The dealers I work with do no such thing and just offer the currency at a price. Period. It's just like any other investment out there. You risk some, if it returns a profit, good. If it doesn't, oh well. It was only $200. Were it that I was spending my whole life's saving on it.....yeah, that would be a huge problem. So relax guys. You're wasting your time with your comments and I'm wasting my time as well. Pardon my english, but IF it does not ever RV.....oh f***ing well. Boohoo, oh man I could've totally used those $200 to buy those new combat boots I wanted. Who the f*** cares???
Ponce - "The thing is all your negativity is unfounded and you haven’t done the proper research. You are going by what your “gut feeling” is telling you about it."
LOL! You're obviously new here. I suggest you read some of the other topics here before trying to tell me what I'm "really" feeling. 😉
Ponce - "They have the enough currency in reserves and the gold to back it up."
Like many Dinarians, all you ever do is confuse Iraq's economy with its currency & produce an endless string of Red Herrings by declaring any news item about Iraq's economy is "proof of the RV". It isn't. Currencies don’t go up or down based on how many mobile phones you buy or skyscrapers you build. The value of a currency is the total money supply divided by Foreign Exchange reserves (that’s why printing more money makes your currency weaker).
Iraq has a money supply of 78 trillion Dinar (that's 78,000bn Dinar). And they have about $70bn foreign reserves to back its international value. Yes they have enough to back the Dinar at it's current rate under 1100:1 (that's why it's at the current rate and is already "fair value" given how overprinted it is, as the IMF have stated). The 99,000% RV is a total myth though as $70bn reserves obviously does not "back" $90,700bn currency at 1:1 vs the $. In fact it doesn't even back 0.08% of a mythical "RV"...
It’s possible to have a fully industrialised strong economy but weak currency (South Korea, Japan, etc). And it’s possible to have a weak economy but strong currency (Greece, Portugal, Argentina, Ghana, Bulgaria, Fiji, etc). A country can *quadruple* its GDP and yet have its currency fall if it keeps expanding its money supply (as Iraq has). Currencies aren't stocks based on GDP - they're commodities.
And the Dinar is not backed by oil. And Iraq sells oil in $ (petrodollars) not Dinar. People who think Iraq's oil "will make the Dinar go up" haven't a clue about Gulf currencies, the Dinar, the oil industry or OPEC. Over 100 countries on Earth also have oil including Iran (whose currency is 10x weaker despite having a larger economy). It's you who needs to do more research. A LOT more research...
Ponce - "So do your due diligence and do the research yourself and stop wasting your time with the negativity"
Yawn. Yet another predictable thinly-veiled call for censorship. This is little more than desperate recycled pumper rhetoric. "Negativity" means "facts that debunk the RV to which I have no reply other than try and silence the messenger with attempted mockery". "Naysayer" means "one of the 6.999bn people on Earth who haven't got sucked into a mis-selling scam" (apparently the Central Bank of Iraq are "naysayers" too, LOL). And "diligent research" is a 2008-era pumper slogan that went out of fashion about 3 years ago. It's what pumpers threw out as an excuse : "I've done SO much diligent research man, that I don't need to answer difficult questions because I'm a diligent researcher!".
Ponce - "Pat yourself on the back and be on your merry way"
Iraq-Businessnews is not a pumper forum, and pumper-style rhetoric, arrogance sneering at "unbelievers" & censorship doesn't work here. People who debunk the RV aren't going to "go away", "shut up", be silenced or beg for your "permission" to post, just because it takes you out of your debating comfort zone. It isn't investing in Iraq in general, that people here are calling out - it's the deliberate pumper mis-selling scam of pretending the Dinar will leap up 99,000% via a currency redenomination. Just as other people call out Nigerian spammers or insurance scams.
If you're fantasising about these forums being like "Dinar Vets" (which is mostly all about peer-ego stroking, emotional comfort blankets, maintaining an obedient "hive mindset" of followers & heavy censorship (and run by a man who uses a false name)), you're quite simply in the wrong place. IBN is a serious site that deals with grown-up tangible investments, not silly get-rich-quick scams based on junk economics and wild misrepresentations of what a "redenomination" is. People here do know what they're talking about and their "diligent research" comes from more than hanging round DinarVets & DinarRecaps or listening to "Kaperoni's conference calls"...
You do what you want with your $200 Ponce. I won't lay awake at night worrying about you personally. There's nothing wrong with genuine investing in Iraq (but sticking banknotes in a draw hoping for a mythical 99,000-297,000% appreciation isn't "investing in Iraq"). But don't tell us where we "should" or "should not" post. Only control freaks do that - and there's plenty of those on various "RV" pumper sites...
Sir, we'll see what happens. Understandable that you know your business and that you're very proficient. Just like the gurus, nothing can be a for sure solid No or Yes in any business. Lets see how it plays out. You just looked quite frustrated by your elongated post. Yes, Dinarists or whatever you want call it live in a fairy fantasy dream. But did you have to write an article on it? Seriously calm yourself....breathe!!
Wow Barry. Breathe brother, breathe.
When facts can’t be disputed, dinaraholics always resort to the old “nobody knows what will happen” argument.
In a way that is true. We don’t know if they will redenominate or not. We don’t know if the dinar will fall a little or gain a little in value over time. The whole country might fall apart the dinar could plummet in value.
But one thing we do know for sure, absolutely without a single shred of doubt. We do know there is no chance what so ever that a big RV like being claimed on dinar boards will ever happen. That is guaranteed.
most agree no one knows whether the dinar will be worth it or not will worth.but in agreement why the dinar has the scam..
t3mpo & Ponce - I am "breathing" just fine thanks. All you've done is simply reinforce what I said - whenever you read something you don't like, and have no answer to, all you can resort to is attempted personal ridicule and 101 variations of "shut up and go away". Sorry, this isn't a pumper forum and your childish propaganda / insults doesn't work here...
Stew - Indeed. It's a propaganda tactic called "appeal to ignorance". A car just passed my window doing 30mph. I don't know what it will do next - speed up to 35mph or slow down to 20mph. I do know for an absolute fact however, that it will not do 30,000mph. Just like $90,000-270,000bn to "support" an "RV" is an impossibility as that exceeds the total money supply of all banknotes in every country on Earth combined... "No-one can know" is so silly it debunks itself when it comes to claiming "Iraq will have more money than 3 planet Earth's of everyone's money combined"...
You're wasting your time Barry. People like Ponce & t3mpo have serious entitlement issues that blind them not just to common sense facts, but also any desire to hold an intelligent debate if it clashes with "I WANT MY MILLION DOLLARS I WAS PROMISED BY A STRANGER ON THE NET".
"Blinded by greed" is not just an old saying - it's a very real psychological phenomenon.
I still laugh when people claim "it will eventually stabilize!" Historically speaking, no. It will not. That regime and area has been in turmoil since biblical times (if I can use that term). The fact that many of the governmental issues still stem from ancient mistrusts and feuds it is no wonder that democracy is failing there, if not already donwith. Maliki is showing hints of the old Saddam era and the ouster of both the CBI's governor and vice is proof that things have a long way to go before any kind of reform can take place, economically or otherwise.
Simply put: they will never advance beyond what they are because they refuse to grow beyond what they are. While there is growth in investments in their infrastructure, there is also real conern over their security of that investment. Nobody wants to invest in a powder keg unless you are also selling fire extinguishers.
Barry, While you are partially right with the printing money makes your money worth less is logical and seems right in every sense of economics (supply and demand) but with a FIAT currency the value is effected by more that M1, M2 and Reserves. I've listened to every argument the last 3 years about the Dinar. Here's what I can tell you - I've analyzed 12 different currency's from from the MENA region, including Bahrain, Kuwait, Jordan, Iraq, Egypt, Israel, Kenya, Saudi Arabia, South Africa, UAE and compared them to the US. I looked at M1, M2, Reserves, GDP, PPP, DFI and ratios between these in various ways. Here's what I found - It's FIAT currency - Its worth what someone says it's worth and the most important element is DFI (Direct Foreign Investment). I personally don't believe that there will be an over night revaluation - I believe that there will be a slow rise and increase in value because of vast natural resources that Iraq has which will drive one thing, DFI! I believe that the infrastructure investments being made to build power plants, highways along with the news of major corporation setting up shop there tell the real story of the power of this investment. Unless you can apply your 2nd grade math skills to all the currencies listed above and reliable produce the actual trading value and exchange rates day in and day within 0.5% you should keep your level of understanding of world economics and money a secret and don't embarrass yourself anymore.
Stew, Math skills quote above is also for you.
Ponse - Thank You! For serving our country.
Roger1 - "It’s FIAT currency – Its worth what someone says it’s worth"
Roger, ALL currencies are fiat currencies. People who run round shouting "Iraq is different because it's fiat" are usually those who only just recently learned what a fiat currency is themselves, find it a novelty, and think it applies only to Iraq...
No-one's on the gold standard anymore. But that doesn't mean currencies are worth "absolutely anything a country declares them to be" though in total divorcement from reality by a factor of 1,000x. Countries do have to "keep it real" or people will simply reject it for trade. A fiat currency simply means a country can print more of them than it would otherwise do on a gold standard since each one isn't backed 1:1 by precious metals, it doesn't mean any arbitrarily dictated value will be accepted by the market or imaginary "99,000% RV's" are "real", or that if it over-prints it can just "pretend" it hasn't.
If you've "researched the region" as you say, then you should know there are two "rates" for Iraq - the official pegged 1163:1 and the sub 1200:1 street market rate (what Iraqi's think it's worth). Iraq's government could declare its fiat currency to be what it wants, but as can be seen by the street market rate, all it would do is convince everyone to dump the Dinar if it no longer matches reality. This "gap" is precisely what's driving "Dollarization" in Iraq in the first place and is what the CBI is still struggling to control.
Roger1 -"and the most important element is DFI (Direct Foreign Investment)"
No it isn't. Far, far more DFI gets piled into Asia & South America, and many currencies haven't gone up at all - some have gone down, see Vietnam as an example for Asia. In 2008, the Brazilian Real could buy $0.64 today it's only $0.44 - and that's despite hundreds of billions of $ of investment into Brazil that dwarfs what's being donated into Iraq, and a doubling in Brazil's GDP.
Trillions upon trillions have been pumped into China and in 20 years it's appreciated about 26%. And that's with a 7tn economy (60x larger than Iraq's) and 1.5bn population (50x larger than Iraq's). And China sells most things in Yuan, whereas Iraq sells oil in $. 26% over 20 years is a compound interest equivalent rate of annual return of 1.2% - even if Iraq matches this (which isn't physically possible given Iraq is smaller than Canada and as an OPEC member has oil quota limits) that's still less than what you'd get sticking it in a high street savings account or fixed-term deposit bond over the same period. Iraq's oil exports is worth about $94bn per year or 1.43% of China's total economy. People need to get over their fetish about oil - 100 other countries have it, and it wasn't just discovered yesterday.
Correlation (more DFI is seen in Iraq's peers) doesn't imply causation ("therefore DFI must cause a strong currency"). The reverse is true - countries attract DFI by having an already stable currency & government. By far the money supply vs FX reserves has the biggest effect, especially for pegged currencies (like the Dinar). People just don't want to accept that with the Dinar though as it would mean admitting the obvious - the Iraq Dinar is more than 2,000x weaker than the Kuwaiti Dinar simply because it's over 2,000x more over-printed - 78 trillion IQD vs only tens of billions of KWD. The effect of DFI is tiny compared to the obvious "If you print 1,000x more money than your neighbors then your currency is going to end up 1,000x weaker".
Interesting you've left off Japan, South Korea, Iran, Nigeria, Lebanon, Indonesia, Vietnam, Chile, Pakistan, Kazakhstan, Hungary, Iceland, Myanmar, Albania, Sri Lanka, Cambodia, Belarus, Malaysia, Mongolia, etc, and about 4 dozen others. Why? Because you already know the answer - all the DFI in the world will not cure currency dilution caused by past chronic inflation and no currency on Earth leaps up 10x fold let alone 3,000x.
Iraq's overprinted currency is far more like Iran, Indonesia or Nigeria's than Kuwait, Israel or South Africa's. In fact, none of the countries you've picked have a value over 10:1 vs the $, most are already at 3:1 not because of DFI but because they didn't inflate them unlike Saddam did. That's about as ridiculous (and dishonest) a comparison as you can produce (and you have the gall to question others "maths skills" when you compare Jordan's 2.2:1 non-inflated currency (25bn JOD money supply) vs Iraq's inflated 1164:1 (78,000bn IQD) - a 3,210x disparity in money supply - as being "similar because it's down to DFI not money supply", ROFL!)
Roger1 - Roger1 - I believe that there will be a slow rise and increase in value because of vast natural resources that Iraq has which will drive one thing, DFI!
Then you obviously don't understand how it works. Iraq sells oil in $ not Dinar, and most oil investment comes into the country in $ (aid, US budgeted reconstruction, etc). Billions of $ in US aid gets paid to US reconstruction firms to build roads, power stations, etc, - in $. So what? That in itself isn't driving up the Dinar anymore than the Icelandic Krone. No matter how much oil Iraq sells, it does not impact the Dinar if it's not priced in Dinar. And like many others, you think simply finding oil drives up the currency. This is also nonsense, as oil only affects the currency A: when it gets sold (otherwise you'd be trying to "price in" the same barrel of oil twice) - and B: Only when it gets sold in that currency. Selling oil for $ does not "drive up" the Dinar, no matter how much you want it to be true. It drives up the stock price of whatever oil company owns the field - yes, but currencies are not stocks - and do not act like stocks.
Iran has 4x the size economy & oil, yet a 10x weaker currency. Why? Same reason as Iraq - they've overprinted their currency. Kuwait's economy is only 25% bigger than Iraq's yet has a 2,000x stronger currency. Why? Because Iraq has printed >2,000x more money. It's not that hard to follow...
Roger1 -I believe that the infrastructure investments being made to build power plants, highways along with the news of major corporation setting up shop there tell the real story of the power of this investment.
Again, all you're doing is confusing currency with economy. They are not the same thing! See above. As for my "maths skills", LOL, Bahrain has a money supply of 9bn BHD. Iraq's is 78,000bn IQD. And you put the 8,666x "difference" down to $0.112bn worth of DFI in Bahrain vs $1.3bn worth of DFI in Iraq... Um, no... that's completely back to front as to the point you're trying to make (not to mention doesn't add up anyway).
Iraq has received an average of just $1.3bn DFI each year since 2008...
http://www.indexmundi.com/facts/iraq/foreign-direct-investment
...The IQD has barely moved 2% over that time (mostly as a result of CBI policy trying to balance growth vs +6% inflation). That's an annual rate of return of less than 0.5%. Hmmm that certainly does "tell the real story of the investment" (PS: You don't "invest" in currencies, you "speculate" on them)...
No-one's saying the Dinar won't go up at all Roger. We are saying it won't magically shoot up 99% let alone an absurd 99,000-279,000% due to a simple redenomination, which is what the real issue with the Dinar being intentionally mis-sold on the back of deliberately false misinformation & junk economics has been all along.
Excellent post Barry. Comparing Israel (3.56:1), Jordan (2.2:1), etc, with Iraq (1164:1) and saying "it's all down to DFI" whilst ignoring the blatantly obvious elephant in the room (more like a whole safari park in fact) is as ludicrous as saying "the 1920's German mark wasn't really overprinted - just compare it to the Swiss Franc and 'pretend' the extra zeroes aren't really there"...
Some people are just incapable of grasping the fact that a fall in inflation does not mean the money supply shrinks or that a devalued currency "deserves" to return to its value in past decades out of confused nostalgia - it just means it doesn't grow as fast. Just like if a country has a $10bn debt and a $1bn budget deficit, a 20% cut in the deficit doesn't mean the debt shrinks to $8bn, it means it only grows to $10.8bn instead of $11bn.
Roger, FDI has little to zero impact on currency values:-
List of Countries by Foreign Direct Investment as % of GDP:-
http://www.theglobaleconomy.com/indicator_static_graph.php?indicatorId=BX.KLT.DINV.WD.GD.ZS&top_ten=0®ions=1w&year=2011
- Liberia's FDI makes up a huge 84.5% of their GDP, and their currency is 74.5:1 (lower than the 60:1 it was before the FDI!)
- Vietnam's FDI is 6% (5x more than Iraq's) and their currency is 21,132:1
- Iraq's FDI is about 1.2% and their currency is 1164:1
- Qatar's is -0.05% and their curreny is 3.64:1
There is no correlation whatsoever because each country has radically different money supplies, Forex reserves & monetary policy (which as Barry said - is which currencies are actually valued on in the real-world away from pumper-dreamland...) FDI in Iraq as a % of GDP, for the past few years (1.2%) has been no different to that of Germany (1.08%), or Italy (1.28%) or the UK (1.48%), Algeria, South Africa, Romania, etc. Some people act like it's uniquely "trillions of hidden wealth" - it's isn't - it's about $1.3bn per year, which is roughly 2% of Iraq' current money supply and a silly 0.0005-0.0017% of a delusional "RV'd" money supply...
There's nothing wrong with Barry or Stew's maths - it's your own entire premise that's massively at fault Roger, and openly debunked in above link clearly listing all countries FDI's side by side.
Iraq's inflated Dinar will continue to be inflated until they redenominate (lop). When this happens, everyone will know in advance (as everyone in Iraq has said - the CBI, Finance Committee, Iraqi Parliament, etc), and it will be visibly included in the Iraqi Govt. budget, and is no "big secret" given they have to change all banknotes, coins, ATM's, accounting practices, retail cash tills, software, auditing processes, etc, in the country. Why this is so emotionally hard for some to accept, I simply do not know...
A dinaholic questioning my math skills is one of the better laughs I’ve had in while.
Roger. You claim you compared all these economic indicators and came up with nothing because it’s all fiat. You are blind then.
Look at a simple comparison of Money Supply as % of GDP. http://www.creditloan.com/infographics/money-supply-as-percent-of-gdp-by-country/
Some Countries are as low as 10%. Some are up close to 200%. The average is probably pretty close to 100%.
Iraq currently has 80 Trillion dinar at .00086, a money supply of about $70 Billion. With a $200 billion GDP that puts Iraq at 35% and right in line where they should be.
The majority of their GDP is in oil sales which are denominated in dollars, so it would be expected that they would be on the lower end of the scale.
Now, let’s look at that number if they were to move the rate to 1:1. They would then have $80 Trillion in money supply, with a $200 billion GDP. That’s 40,000%!!!
Every other country in the world 10-200%
Iraq 40,000%... only in dinarland.
Also, $80 Trillion would also be more money supply than the rest of the world combined.
You think “fiat” could produce numbers like that?
So what could Iraq’s exchange rate be and still fit in the chart? Let’s bump them near top of the world rankings and put them at 200%. With a $200 billion GDP, they could have a money supply of $400 billion. So they could RV their 80 trillion dinar to .005, or half a penny. That’s about as high as it could ever be expected to go. It’s not going to happen, but at least you wouldn’t look like an idiot if you were calling for a RV to 1/2 a penny.
And the crazy thing is, it is elementary math. Yet they can’t figure it out.
Barry is so mad. LOL.
"Barry is so mad. LOL."
And you are a troll...
I was starting to wonder if you were going to catch on. Good job. xD
Roger1 Any time buddy! Thank you for your support. I make sure to let it be known that I appreciate those that support the troops! Lets see where this will take us.
Wells fargo deals with dinar and have just come to agreements with china to buy back the dinar because they then hve a substantial amount to buy oil from iraq at a cheap rate, end of the day you buy 1million diar at a rate 0.00055 which is approx £800 then they remov the zeros an revalu the exchange rate which needs to be done du to the pressure of the economy ie. Oil gas etc etc to 1.0 dollar per dinar you nowhave 1 million dinar to sell back at the rate of 1 dollar which makes it 1 million dollar, i do listen to everyones opinion in this subject but iraq have no choice to revalue they need the value to b lik 10- 15 years ago which was 2.15 dollar a dinar. If someone can prove that wrong i invite you to do so.
ROFL! Dannyawm - There's nothing there to "disprove" as it's just the usual pumper-made-up total gibberish that even openly contradicts itself! To start with, why on Earth is buying oil from Iraq at a *cheaper* rate going to make Iraq more wealthy? If you sold $10 widgets and lowered your price to $6, would you be "richer". LOL. That's as totally backwards as you can get...
Secondly, Iraq sells oil in $ not Dinar so oil has zero impact on the Dinar's value. Thirdly, the price of oil is set by OPEC of which Iraq is a member. It's only quota's that differ between Gulf countries, not oil prices. Fourth, neither China or the USA hold any significant amount of Dinar - this has been openly debunked so many times (including inside a US courtroom) - it's just another delusional pumper myth that people cling onto out of emotional desperation. COFER statistics are no "big secret". No-one outside of Iraq holds "masses" of Dinar at all.
Overall, it's just the usual drivel churned out on "conference calls" hosted by "personalities" or "tidbit rumors" who invent wild claims their devout followers cannot (and often do not wish to) verify. There is no "special oil price agreement", Iraq isn't going to bankrupt itself selling oil for less than its market value, and oil makes no difference to the Dinar's value anyway as it's sold in dollars not Dinar.
Iraq have printed almost 80,000bn Dinar. Their economy (including oil exports) is about $130bn Dinar. Even a 500:1 RV doesn't mathematically add up let alone a 1:1. LOL. In fact, Iraq export around 2.7m barrels of oil per day. That works out to around $98bn per year. It would take 795 years worth of oil sales (from now until 2808AD just to support a mythical "RV'd" money supply just for 2013, assuming they do not print another Dinar for 8 centuries...) That's how utterly stupid the "oil will support a 1:1 RV" pumper sales pitch really is.
And "A friend of mine said that Wells Fargo said..." stupid conspiracy thing has been done to death every month since it was originally debunked back in 2008. Here's what Wells Fargo have actually said in the real-world away from pumper-land about the Dinar in their own words:-
"Considering the illiquidity and fraud risk, Wells Fargo Bank has no plans to trade in the Iraqi currency, and considering that Iraq remains a dangerous place with an uncertain future, we strongly advise investors against taking the risk of buying Iraqi dinar as an investment. If you’re considering such a purchase, ask if the dealers will guarantee to buy back the currency, how they will peg the price and how much they will charge. Then ask a fiduciary financial advisor such as a certified financial planner, chartered financial analyst, lawyer or accountant if such an arrangement makes sense for you. It may not be worth your time and consume every dime — or dinar — you’ve invested."
http://www.forbes.com/sites/johnwasik/2012/02/24/dinar-doubts-multiply/2/
There is no "$2 missing value" to return to for the same reason America will not "return" to $50,000 house prices, $2,000 cars, $20/oz gold or $0.05 loaves of bread - what you think is "hidden wealth" is nothing more than years worth of plain ordinary inflation caused by printing too much money...
Stop reading "RV" sites, they'll rot your brain.
WOW! with all this financial and accounting expertise here I feel like I am surrounded by the heads of some major financial institutions, that somehow have the crystal ball to see the future. And not only that they seem to know exactly what is going to happen with respect to Iraq's economy, ( pretty good , as not even those in Iraq really know). I find it quite interesting though , that through every one of the novels written by the KIA'S ( know it alls), not once did , anyone put into their statements the fact that Iraq sits on the largest fresh water supply in the region, the largest supply of natural gas in the region, and that Iraq is poised to increase its oil production 5x by 2017-2018 to 11 million barrels per day. Now to set the record straight ,and this is the way it is , like it or not , KIA'S, a currency's & country's value is determined by its assets, and Iraq has plenty of value in assets,hence its natural resources. And for anyone to say that oil has absolutely no bearing on the value of Dinar, just proves how un-informed those in the KIA world really are.The KIA'S just don't, for what ever reason,(other than reasons taken from "The Iraqi Dinar investment is a scam" websites)want to believe that there is an opportunity here for the average Joe to quite possibly make some money from this investment,with all indicators pointing to Iraqs desire to once again be a major player in the Middle East. And at this point , investing in the Dinar carries no more risk than purchasing ANY, I REPEAT ANY other currency in the world, all of them are subject to exchange differentials, for example, today, if I purchased $100 USD, it would cost me around $105 Canadian, and for whatever reason I didn't go to the US and needed to cash it in I would only get around $96 Canadian back, would I then have been "SCAMMED"? The answer is,NO. And the same holds true for the Dinar,I purchased 105'000 IQD for $97.40 Canadian today, Now, if I listened to the KIA and got spooked by the rhetoric that they obviously would like me to fall victim to, and decided to bail on this purchase, then I would be no worse off than if my purchase would have been USD as I would still be able to get most of my money back,approx $86 Canadian, so if someone can point out the difference ,please do!For anyone to say that you can't make a significant return on playing around in the currency markets , just goes to show how much they DON"T KNOW. Not that long ago the Canadian $ was worth as high as$1.05 against the US greenback and a short time later (approx 14-15months ) the Canadian $ went back down to $.98-$.99 against the USD, so a nice return was realised by some saavy investors, after the invasion of Kuwait, the Kuwaiti Dinar plummeted in value, only to recoup its value after Saddam's forces were ousted and the Kuwaiti gov't was returned to power.History provides documented proof of the gains realised by those who invested in that currency at that time. Now unless the KIA are prepared to go in and re-write the history books, there is no disputing the facts. Now to elaborate a bit about why no banks would trade in IQD for the last 23 years Chapter 7 prevented that,and that is all that needs to be said in that regard. So in short, to all of those who have invested in the Iraqi Dinar, fear not,as at any given time, you CAN recoup most of your money back,by simply reselling your Dinars back, and eat the exchange differential.And the SCAM references made in this forum are made by individuals who don't even comprehend what the statement means.ENRON, BRE-X, THOSE were SCAMS,the Iraqi Dinar,IS an investment product and one should use his/her own discretion when investing, and the same holds true with anything you are willing to take a chance on,CHEERS EVERYBODY AND TAKE WHAT YOU READ , WITH RESPECT TO THE KIA,WITH A DOSE OF SALT,THEY HAVE BLINDERS ON AND CAN'T POSSIBLY VIEW THE WHOLE PICTURE, SINCERELY .....GOATEEMAN
goateeman - "with all this financial and accounting expertise here I feel like I am surrounded by the heads of some major financial institutions, that somehow have the crystal ball to see the future"
No one claims to be psychic, but this is a serious investment forum that actually deals with the facts & the real world - not a childish pumper board with group-sharing of feel-good fantasies and angry indignation should any "naysayer" 'dare' spoil the cult-like unquestioning hive mindset, and yes, people here do know what they're talking about. For some reason, people who aren't very knowledgeable about the Forex market and have been sucked in the "RV" mis-selling scam, find that a threat to their "no-one can possibly know more than I do because I hang round pumper forums run by salesmen all day" ego's (which ironically is a genuine example of a "Know-It-All")... 🙂
goateeman - "like it or not , KIA’S, a currency’s & country’s value is determined by its assets,"
No it isn't - that's just your confused desire. A currency's value is predominantly determined by how much money has been printed divided by whatever Forex reserves the nation has to back it - basic supply & demand. That's why printing more money results in a weaker currency (even with a growing economy). Iraq has printed 78,000bn Dinar, and they have around $65-70bn to back it with - hence the sub 1100:1 ratio... Even my 9 year old daughter can do the maths on that one...
It's possible to have a weak currency and strong economy (China, Japan & South Korea), and it's possible to have a strong currency and weak economy (Greece, Portugal, Fiji, Bulgaria, etc). Of course, Iraq's economy is slowly growing, but that's utterly irrelevant to the fact with 72 TRILLION Dinar in circulation (vs 29 BILLION Dinar of Kuwait), the Iraqi Dinar is devalued by over 2500:1 vs its neighbor because it's been 2,500x overprinted vs its neighbors money supply, and no amount of "yes but they have water / oil / whatever" will cure that massive, massive discrepancy, which is precisely why they're planning to redenominate in the first place...
South Korea is a fully industrialised nation with a lot of resources and a $1.26tn economy, and their currency is a weak 1119:1. Malaysia's economy is 5x smaller but has a value of 3.3:1. Indonesia has "a lot of water" and its currency is 10301:1. Iran has more oil than Iraq and their currency is 12285:1. Venezuela has double Iraq's oil reserves, and their currency is 6.28:1 (after lopping 3 zeroes a few years back). Nigeria is an oil rich country and theirs is 160:1. Fiji is a tiny island nation with a population of less than 1m, is drowning in govt debt, with a huge deficit, and little to no natural resources, and their currency is 1.87:1.
Why? Because they obviously all have vastly differing money supplies and Forex reserves - which is what currencies are actually valued on in the real world. Kuwait has about 30bn Kuwaiti Dinar - Iraq has 78 trillion, and Iran has printed quadrillions. If you stopped obsessing about "ME AND MY BANKNOTES" on pumper-run "RV" forums, and did some serious grown-up Forex research beyond Iraq, you'll probably start to understand how currencies actually work and what "inflation" is. The rest of your post is just the usual "seen it all before" angry reactionary indignation of childish name-calling and yelling in capital letters...
goateeman - "So in short, to all of those who have invested in the Iraqi Dinar, fear not,as at any given time, you CAN recoup most of your money back,by simply reselling your Dinars back, and eat the exchange differential."
It's not being able to change Dinar that's the scam - it's the persistent, deliberate and wilful misrepresentation of its value and Iraq's proposed redenomination as an absurd 99,000% profit get-rich-quick scheme that's the scam (a mis-selling scam). Just like insurance is legal, but misselling it is not. Just like penny-stocks are legal, but "pump and dump" scams (CMKX, etc) aren't. If you're intending to make 10-20% profit on Iraq's stock market - good for you. But we all know that's not what most guru-following amateurs are buying for...
The exchange differential is precisely where most of the loss occurs due to the rip-off 20-25% spreads charged by Western Dinar sellers far higher than any other currency. Eg, Dinar Trade is selling 1m Dinar ($859 worth) for $1,020 - an extortionate 19% ripoff (double to triple the "commission cut" of buying say Euro's from Travelex). Selling it back will net as little as $760 per 1m Dinar. So in total you've lost over 1/4 of your "investment". Damn, why didn't us stupid "KIA's" think of doing that instead of making 20-25% annual profit in serious grown-up investments (which each year over a decade adds up to a tripling in our money). 🙂
To set the record straight boys,I do NOT follow the"pumper" Dinar guru sites such as Dinar Guru, Dinar Vets and the like, as yes I will admit,those sites are so full of B/S that even a bull would be impressed.I based my decision to invest on govt reports from the Middle East,US, Britain,Germany, and all are consistent with regards to what the country of Iraq is poised to realize in the future.I am in this for the long haul, and if that means holding what I have, for a decade ,then so be it.Like it or not , Iraq is on their way to a bright future, and taking a chance on it (the Dinar), for what I personally have in it,is minimal,and I am fully confident that a good profit will be realised at the end of the day.Interestingly enough though, is that Barry & John haven't commented on how removing Iraq from chapter 7 will impact the country's economy, that some of the countries mentioned re: Iran, Venezuela,Nigeria are anti- US, and are under UN sanctions restricting the flow of cash & trade through those countries, so yes there are valid reasons that the currencies of those countries have been deemed worthless on the world markets, and it is a well known fact that sanctions imposed on any given country,will affect the value of that countries currency on world markets, and sanctions imposed are, by design, meant to prohibit a country from doing business as usual and more times than not,severely hampers a countries ability to purchase weopons and to make it clear that the world isn't going to sit back and let them be a threat to its neighbours or other countries.So in your next responses , boys , lets see how much you actually know about the effects of being placed under chapter 7 would have on a country, and the effects of being released from chapter 7 would have on a country. I think you are going to figure out that even if a countries money printed verses reserves to back it up were on par with each other that a countries currency value would plummet as a result of being placed under those extreme sanctions. furthermore if any of the countries mentioned , with strong currencies were placed under chapter 7, including the US,Britain,Kuwait,Bahrain etc, their respective currencies would de-value in a huge way.So again I say take what the KIA say about this Dinar investment with a dose of salt as they have blinders on and can't possibly view the whole picture here. Cheers!.....Goateeman!P.S. Don't assume that the Guru sites are the only source of info on this subject,there are many sources of info regarding this subject that are far removed from any "pumper, guru, egotistical sales pitch type sites" that are commonly referred to in this forum.
goateeman, I don't know why you keep saying "like it or not, Iraq's getting better" on a site that's obviously about serious investing in Iraq. I'm happy Iraq's economy is growing. But genuine economic growth is a completely separate issue from the obvious "99,000-297,000% profit" scam that's been bandied about, which is what we've been speaking about all along, before you jumped in.
Some people act like we fell out of the idiot tree yesterday, we apparently don't know anything about Iraq or Forex, etc, simply because they themselves are new to Forex speculation, find the Dinar a novelty and only they "know" the truth just from mail-ordering a few banknotes (at rip-off prices) and follow a few silver-tongued salesmen around like sheep for years on end despite 1,700 out of 1,700 failed predictions...
goateeman - "Interestingly enough though, is that Barry & John haven’t commented on how removing Iraq from chapter 7 will impact the country’s economy"
Who are you talking to if you're talking about us in the 3rd person and yet no-one else has responded to you? An invisible friend? Most people who chant "Chapter 7, Chapter 7, Chapter 7" as a automated slogan in relation to the Dinar's wealth usually haven't even read what Chapter 7 actually says beyond what the guru's "suggest" it means:-
http://www.un.org/en/documents/charter/chapter7.shtml
Chapter 7 authorizes the UN to impose sanctions, blockades, diplomatic severance or use military force against a country that steps out of line. That's it. Removal of chapter 7 allows Iraq to regain the sovereignty to sign treaties, trade agreements, regain autonomous diplomatic relations, etc. Iraq can rebuild its military, be party to political / trade treaties, etc, without having to ask the UN.
Chapter 7 won't make Iraq's GDP magically shoot up 100,000-300,000% (pure delusion as that would equal 4.5x planet Earth sized global economies - see the obvious maths problem with that?) Oil will still be sold in petrodollars and have no more effect on the Dinar than it will the Polish Zloty. Iraq will still be a member of OPEC and be subject to oil export quotas (10m barrels is a pipe dream). Iraq will still be exporting 2.7m barrels per day due to basic internal infrastructural logistics, smuggling, and terrorism limitations. Terrorist bombs are still going off.
The Iraqi Dinar is still not backed by oil because it's still a fiat currency like everyone else's - there is nothing whatsoever "special" or "unique" about it beyond BS pumper sales hype. Iraq's $95bn oil revenues still can't even pay for Iraq's annual $112bn govt spending spree, and Iraq is still running a budget deficit, does not have any "secret wealth" and owes Kuwait billions in reparations.
The Oil For Food programme was under Chapter 7 and that ended officially 3 years ago in 2010 (and unofficially in 2003). That's one example of what Chapter 7 did. Most Chapter 7 sanctions stuff like that was already informally inactive anyway years ago, post-Saddam. The UN vote was mostly "dotting the i's & crossing the t's". The only Chapter 7 trade restriction on Iraq now is a ban on selling the stolen Iraqi cultural property (eg, artefacts looted from the Baghdad Museum during the invasion).
Chapter 7 hasn't prevented Iraq from exporting oil nor did it prevent Iraq from signing the 2009 oil services contracts with USA, UK, China, Italy, France, Malaysia, Netherlands, Korea, Russia & Turkey. Many trade restrictions were already lifted years earlier. Chapter 7 has not prevented Iraq from revaluing their currency as they already have several times (from 1200:1 to 1164:1) to tackle inflation. That's what a genuine "RV" is in reality.
It seems you really don't understand what "Chapter 7" is, if you think it magically creates some "hidden windfall" waiting for Iraq to inherit. Chapter 7 is just the international equivalent of a "bad behavior curfew". Lifting it makes no difference at all to the Dinar's value, which is precisely why the Dinar hasn't changed even 1% in value since it was lifted 2 months ago...
Barry just about covered everything. Those who bang on over "Chapter 7" as some sort of "answer" haven't a clue what it's about. A bit like "Executive Order 13303" which despite being mindlessly chanted like a mantra by the Dinaraholics, has nothing whatsoever to do with the Dinar or private ownership of anything other than oil assets that are actually inside Iraq's borders - go read the actual text yourself. Most Chapter 7 restrictions in reality were lifted years ago. Example from 2010:-
"The UN Security Council has voted to lift most international sanctions imposed on Iraq during the Saddam Hussein era." - 15th Dec 2010
http://www.bbc.co.uk/news/world-middle-east-12004115
That's 3 years old. The June UN C7 Vote did nothing at all for the Dinar - just formalizing what was already lifted years ago - and the lifting of most oil-related trade sanctions occurred years ago, some in 2003, some in 2007 and some in 2010. LOL. There is nothing external "holding the Dinar back" at all. It's weak because it's overprinted - yes, it really is that simple, and is precisely why they're planning a redenomination in the first place.
And there are no UN resolutions against Venezuela, Nigeria, etc. The Bolivar fell in value years ago due to printing too much money - and they lopped from 2,150:1 to 2.15:1 back in 2008. It has since fallen further due to starting printing more money again. Likewise Iran plummeted due to chronic inflation decades ago, and they have a +1,000,000,000,000,000 Rial money supply. The Vietnamese Dong is weak because it too has a money supply in the quadrillions. As has Indonesia. Zimbabwe. South Korea is weak because they have 2 Quadrillion Won. The elephant in the room that's been staring at you the whole time whilst you frantically try and pretend "inflation can't possibly make currencies weaker". LOL.