Fake-Money Flood Is Aimed At Crippling Iraq's Economy

[dontlop]

Fake-Money Flood Is Aimed At Crippling Iraq's Economy

By YOUSSEF M. IBRAHIM

Published: May 27, 1992

http://www.nytimes.c...nted=all&src=pm

Iraq's economy is the target of an American-led destabilization campaign to pour vast amounts of counterfeit currency into the country, Arab and Western officials here say.

The fake dinar notes are being smuggled across the Jordanian, Saudi, Turkish and Iranian borders in an effort to undermine the Iraqi economy, said the officials here who closely monitor the situation inside Iraq. Those officials said counterfeit dollars are being smuggled into Iraq in smaller quantities to further confound the banking system. The officials, who insisted on not being identified, said the countries behind the separate counterfeiting operations included Western nations, Saudi Arabia, Iran and Israel.

The fake currency is openly discussed in the press and by the people in Iraq. The counterfeiting problem has become serious enough to be loudly denounced by the Government, which is taking measures to curb it, including instituting life sentences for cooperating in circulating counterfeit dollars or dinars and death sentences for those who smuggle them into the country. Efforts in High Gear

The fake currency has contributed to Iraq's severe inflation problem, which is aggravated by the fact that the Iraqi Government is printing money at uncontrolled speed to pay inflated salaries and cover the costs of reconstruction.

Over the last few months, the destabilization efforts seem to have shifted into high gear, officials here say, particularly after the United States was reported in February to have authorized full-fledged covert operations against Iraq.

[ In Washington, Mark Mansfield, a spokesman for the Central Intelligence Agency, declined to discuss the dumping of fake currency in Iraq. "As a matter of policy we don't comment on such allegations," he said. ] Pressure on Saddam Hussein

Along with international economic sanctions against Iraq, those measures have had mixed results since the Persian Gulf war ended in February 1991. They have clearly helped weaken the economy to the point where the local currency could become worthless, and they have loosened Mr. Hussein's grip on the people and forced his Government to respond with an intensified reconstruction program to curtail shortages and restore basic services.

On the other hand, the measures buttressed the assertion, shared by a rising number of Iraqi nationalists including Sunni Muslims and Christians, that the West and its allies will not be content with the removal of Saddam Hussein, but only with partitioning and destroying the country.

Further weakening the economy is the fact that legitimate Iraqi currency is not backed by any gold or hard currency because those are being used to import goods.

As a result, the dinar, which has a fixed rate of exchange equivalent to three United States dollars, has a real value of about 2 percent of that.

"You can get as much as 21 dinar to the dollar when things are really going badly but it does not get better than 16 dinars to the dollar," a diplomat said.

Some Iraqi travelers interviewed here, including businessmen, said they expected the currency value to plunge much farther soon.

Since Iraq stopped doing business with Brtiain during the gulf crisis and began printing its own money on lower-quality paper, counterfeiting has become much easier, various sources said. Entry Points for Fake Money

"People joke about it and some have become experts in telling which denominations are printed in Israel, the United States or in Saudi Arabia," said an Iraqi who insisted not being identified.

Iraq accused Washington of masterminding a campaign to smuggle counterfeit currency into Iraq "to sabotage the Iraqi economy in cooperation with Iran and Saudi Arabia," according to a May 6 letter to the United Nations Secretary General, Boutros Boutros-Ghali.

Counterfeit money was dropped by United States helicopters in the southern marshland areas, in Mandali and in al-Tib in the Maysan governorate, said the letter from the Iraqi Foreign Minister, Ahmad Hussein.

The letter, reported by the Iraqi press agency and reprinted in Iraqi newspapers, said counterfeit money was entering the country through the Turkish and Jordanian borders as well. Stiff Punishment Imposed

A Saudi official, who insisted on not being identified, concurred with the reports, saying that "all borders are being used."

Similarly, a senior Jordanian official agreed with the report, saying Jordan "does not approve of it, but we can do little to stop it".

The Israeli Government has made no public acknowledgement of any participation in such an operation.

On May 10, the Iraqi Revolutionary Command Council issued a decree withdrawing all 100 dinar bills. It said unless the larger bills were turned over to the banks in return for bills of different denominations, they would be worthless ""within 30 days".

On May 20, the Iraqi Ministry of Justice instructed the courts to hand down the stiff sentences for circulating the money.

Most stores in big Iraqi cities have acquired machines to detect fake currency, and many merchants have stopped accepting large-denomination bills. Insuring Basic Supplies

Despite wide-ranging efforts to undermine Mr. Hussein, Jordanian officials who are familiar with the power structure in Iraq say the Government is not about to fall, even though public discontent is widespread.

Western diplomats assigned here to keep watch on Iraq say Mr. Hussein has surrounded himself and the rest of the ruling establishment with some 45,000 men spread over four different security services and units of the Republican guards.

"He is looking like a big fish in small pond that keeps on getting smaller, but those who surround him are generously compensated and most of them know their fate is tied to his," a foreign diplomat who insisted on not being identified said.

Diplomats say Iraq has made sure that its reserve funds are used to insure the supply of basic foods to the population to avoid an outright revolt.

"It's not Somalia, where they haven't seen meat in ages," a Western diplomat said. "Government rations insure a minimum of 1,300 calories per person and in most cases, the subsistence level of 1,600 calories is available to most Iraqis." Circumventing Sanctions

"Basic goods are isolated from the market mechanism and remain available to most people under a rationing system regardless of the hyperinflation," said Fahd al-Fanek, a Jordanian economist who has visited Iraq recently.

Iraq's Minister of Education and Scientific Research, Abdelrazak al-Hashemi, said in a recent interview from Amman: "We are not going to stop living just because sanctions are maintained and we will not accept humiliating conditions to export oil. The Iraqi people realize that this campaign is aimed at our country, its purpose being to partition Iraq and destroy it as a nation, but these dreams will never happen."

Despite the stern sanctions imposed on the country's imports, the Iraqi Government appears able to obtain not only essential goods but forbidden imports of some spare parts for factories, using a vast cache of gold and hard currency.

The Iraqi Government has made great headway in its reconstruction program, reinstituting basic services that were destroyed or damaged by the gulf war in Baghdad and other major cities.

Iraqis and Jordanians say about 110 or 130 bridges destroyed during the war have been repaired. Electricity cutoffs have stopped in Baghdad and telephone service to the capital has largely resumed. Iraqi Funds Unfrozen

A Western diplomat said the crucial highway linking the Jordanian border to Baghdad, a vital connection with the outside world, has been resurfaced with abundant asphalt produced by Iraq's rejuvenated oil refineries and is "one of the best in the world."

Diplomats say Iraq finds some comfort also in dealing with countries on its borders within the limits of United Nations sanctions.

After Saudi Arabia cut oil supplies to Jordan during the gulf crisis, for example, Iraq began exporting 55,000 barrels of oil per day to Jordan, of which 33,000 barrels a day are free of charge, bringing much goodwill toward the Iraqis. The balance of the oil is sold at a fixed price of $16 a barrel in return for goods that Jordan exports that are permitted under the sanctions regime imposed on Iraq by the United Nations.

Elsewhere, as Iraqi funds are unfrozen slowly in various parts of the world, Iraq is able to continue to buy foods and permitted items, thus further alleviating shortages. Clandestine Radio

Furthermore, Jordanians and Iraqis say, Mr. Hussein is tolerating some discontent and petty corruption as measures to release some steam.

Iraqis who were not able to leave the country because they were blacklisted, for instance, have been able to obtain passports with bribes while the regime looks the other way.

But Mr. Fanek said that the policy of humiliating Iraq is backfiring as most Iraqis, and more Arabs, have come to look on the West not as a savior but as an oppressor.

On other fronts, the broad campaign to destabilize the Government of Mr. Hussein includes clandestine radio stations and dissident militias financed and organized by the United States, Iran, Saudi Arabia, Turkey, Israel, Britain and France.

The stations broadcast in Arabic, Kurdish and Turkmen, inveighing the population to revolt, according to Western diplomats assigned to Amman, Iraqi travelers, and Jordanian officials, all of whom insisted that their names be withheld.

While part of the destabilization plan, like the counterfeit smuggling operations, is coordinated by Western allies separately with Turkey, Saudi Arabia and Israel, other efforts like Iran's and Saudi Arabia's arming and finanacing of dissidents reflect competition with Western allies rather than cooperation with their efforts.

Iran has steadily worked to bring down the Iraqi Government in favor of a Shiite Islamic republic fashioned on its own model, particularly in the oil-producing south around Basra.

Saudi Arabia, which does not want to see an Iranian-style government on its borders, is working on assembling and organizing exiled Iraqi dissidents who are former officers and officials of the ruling Baath party.

Edited by dontlop, 09 January 2014 - 12:10 PM.

Read more: http://dinarvets.com/forums/index.php?/topic/92667-iqd-backing/page-12#ixzz2w2fzqhjv

And on another note

When faced with the prospect of a currency crisis, central bankers in a fixed exchange rate economy can try to maintain the current fixed exchange rate by eating into the country's foreign reserves, or letting the exchange rate fluctuate.

Why is tapping into foreign reserves a solution? When the market expects devaluation, downward pressure placed on the currency can really only be offset by an increase in the interest rate. In order to increase the rate, the central bank has to shrink the money supply, which in turn increases demand for the currency. (>>>>The bank can do this by selling off foreign reserves to create a capital outflow. When the bank sells a portion of its foreign reserves, it receives payment in the form of the domestic currency, which it holds out of circulation as an asset.<<<<)<<<<<currency auctions?

Propping up the exchange rate cannot last forever, both in terms of a decline in foreign reserves as well as political and economic factors, such as rising unemployment. Devaluing the currency by increasing the fixed exchange rate results in domestic goods being cheaper than foreign goods, which boosts demand for workers and increases output. In the short run devaluation also increases interest rates, which must be offset by the central bank through an increase in the money supply and an increase in foreign reserves. As mentioned earlier, propping up a fixed exchange rate can eat through a country's reserves quickly, and devaluing the currency can add back reserves.

Unfortunately for banks, but fortunately for you, investors are well aware that a devaluation strategy can be used, and can build this into their expectations. If the market expects the central bank to devalue the currency, which would increase the exchange rate, the possibility of boosting foreign reserves through an increase in aggregate demand is not realized. Instead, the central bank must use its reserves to shrink the money supply, which increases the domestic interest rate.

Read more: http://dinarvets.com/forums/index.php?/topic/92667-iqd-backing/page-12#ixzz2w2gcbiBL

And another note

Open market operations

http://www.khanacademy.org/economics-finance-domain/core-finance/money-and-banking/banking-and-money/v/banking-13--open-market-operations

My favorite part of the ny times article above

As a matter of policy we don't comment on such allegations," he said. ] Pressure on Saddam Hussein

Along with international economic sanctions against Iraq, those measures have had mixed results since the Persian Gulf war ended in February 1991. They have clearly helped weaken the economy to the point where the local currency could become worthless, and they have loosened Mr. Hussein's grip on the people and forced his Government to respond with an intensified reconstruction program to curtail shortages and restore basic services.

Read more: http://dinarvets.com/forums/index.php?/topic/174103-fake-money-flood-is-aimed-at-crippling-iraqs-economy/#ixzz2w2kWXKeO

Who says the dinar was not destroyed by the west ?

Edited March 15, 2014 by dontlop

[dontlop]

Since the west took part in the destruction of the Iraqi economy and its currency to rid the world of saddam Hussein

Should it be restored by the west or if it was the west that helped destroy it should the west help restore it ?

Since saddam is gone now why not

[dontlop]

Another note

#216 dontlop

[_/\_.•*•._/\_]

First, the importance of the

inclusion of natural resources in the national accounting systems has been

recognized only in the last decades, and although efforts to broaden the

national accounts are being made, they are mostly limited to international

organizations (such as the UN or the World Bank). Second

Read more: http://www.thedialog...tnewversion.pdf

http://www.ide.go.jp...ort/cia_11.html

Critical to China’s economic successes in Africa has been the important use of the country’s state backed banking institutions. Under-pinning the aggressive buy-out of foreign resource companies, mineral and energy reserves and large institutional investment projects in the continents oil and infrastructure sectors, are a phalanx of state funding agencies supported by massive national reserves of accumulated liquidity of over US$2 trillion, ready to be shifted into the global market at a moments notice.

Edited by dontlop, 17 February 2014 - 06:36 PM.

Read more: http://dinarvets.com/forums/index.php?/topic/171925-rents-to-riches-imf-world-bank-natural-resources/#ixzz2w3FWNJb4

Bee beep

So what china is doing is giving loans to resource backed company's or country's and makes purchase contracts for those minerals oil and gas so they can pay back the loans with oil gas and minerals

They are giving loans on oil in the ground to insure future energy supply for their country

They will give you the money now

Then on some future date they get oil or minerals

They buy oil futures

I'd like to see Iraq sell them 5 trillion worth right now

Then Iraq has 5 trillion to build a private sector infrastructure that will always produce income for Iraqs future beyond its oil infrastructure

Iraq can revalue their currency with 5 trillion dollars backing it

lol

Edited by dontlop, 17 February 2014 - 07:10 PM.

Read more: http://dinarvets.com/forums/index.php?/topic/171925-rents-to-riches-imf-world-bank-natural-resources/#ixzz2w3GBnbYt

Hello

Economist calls on CBI to adopt oil and gas instead of gold and USD currency reserves

Economist calls for the adoption of the oil and gas reserve of the Central Bank economist

May 11, 2013, 1:43 pm

Economic expert called on behalf of Jamil Antoine, on Saturday, the central bank to adopt oil and gas Kkhozan the reserves instead of gold and the dollar, stressing that the value of oil exports during the year twice all the gold reserves in the country.

Said Antoine told him the reporter, “news agency Iraqis,” that: “reserves the central bank alone is not enough to maintain the stability of the Iraqi economy, where you must rely on reserve economist is the stock of oil and gas, because the reserves the central bank money and gold is not equal to the export of oil to one year . “

Noting that: “Reserve the main possible to protect Iraq’s economy is the stock of oil and gas in the ground,” and explained that “the statistics of the Ministry of Oil indicate that the oil reserves reached about 150 billion barrels and 19 billion m3 of gas, up to the month of February of the year Current. “

I've got plenty of reasons to hang on to my dinar till they call it in for exchange

[jeepguy]

   wow   

 can  I get  the  broken down  easy  to read edition  ?  

[dinarbeleiver]

Dontlop You Rock!!!

[divemaster5734]

I wonder, instead of all the technical stuff, could this just be a way for them to decide to say all out of country currency is not void?

 

Wouldn't that be a way to keep us small investors from profiting?

 

Man, that would SUCK.

[dontlop]

   wow   

 can  I get  the  broken down  easy  to read edition  ?

since the Persian Gulf war ended in February 1991. They have clearly helped weaken the economy to the point where the local currency could become worthless

Read more: http://dinarvets.com/forums/index.php?/topic/174103-fake-money-flood-is-aimed-at-crippling-iraqs-economy/#ixzz2w45DZK9U

That's the point

They intentionally destroyed Iraqs economy and currency

It did become worthless

Once he was broke then they invaded he had no way to finance any defense

Kinda like what they are doing to Iran right now

[jeepguy]

thanks  don`t lop  ,    it  seems  like a way too keep the  defenders , broke down during the  offensive ,  but now ,  they are  getting their way back to  a  solid  foundation ,   such as the infra structure ,  and  the  international business forums  are  looking to swarm in now they have a  more industrious  means  to  build  and  succeed ,  even the oil is  higher  in sales , and  the  budget  highest  ever ,     if  the  external  powers  are in charge of  currency  values {  the united nations  through  world banking , }   they surely must be seeing that Iraq is now at  the point of  reaching  a value in it`s money to be equal , too , or  near  1 too 1  !     thanks for bring  the article  my friend 

[djgabrielie]

.I thought the IQD was so hard to counterfeit.  Guess that was all all BS.

[one2one]

not possible to counterfeit the IQD --at least the new ones I have

[dontlop]

This article was from 1992

I'm just looking for feed back

Who really knows anything besides lopsters

I don't know shee ought

[sandfly]

THANKS

[dinarmite]

not possible to counterfeit the IQD --at least the new ones I have

Nothing is impossible when you own the printing machine.

[dontlop]

Some people stated the west destroyed the IQD and some people say no it was saddam who destroyed it by printing

The first article is one of a few out there that shows we were dumping counterfit dinar into Iraq to push it over the cliff to make it worthless

I remember hearing these stories back in the 90s

[Pablo404]

The only printing presses working overtime are at the US Fed. The rate in 2013 was one trillion a year added to supply.  The current "Budget" calls for I believe another eighty billion in spending and more tax increases to apply to 'automatic' increases and new spending proposals. When the "brown" hits the fan with no more "petro-dollar oil"  and Basil III asset backing fully in force, we may see a 40% loss of purchase power for an unknown term. The training of the military for urban warfare may be in anticipation of the truly "PO'd" folks  who finally realize the effect of the lies of our own government and bankers. Holding on to a strong "non-dollar" currency and hard assets may be a survival necessity, although our government will undoubtedly try some arm twisting (here and overseas) to "force" conversion or simply apply an "ex post facto" special tax since the US Constitution no longer means it applies to "civil" matters.  (Congress loves the part about "retroactive to" in the laws that do not apply to them.)

   Commodities, copper, gold, silver, precious metals, jewelry, interest rates all going up.  Check out FACTA effective 1 July, 2014. (HR-2847) Pay down or off your personal debts. Percentage losses of personal and business accounts may be a factor as well due to confiscation by banks. (Remember - you are regarded as a "stockholder" now.)  Pay attention and prepare.

[dontlop]

How do ya prepare

The only thing that will change will be internationally

The us is self sustaining

Farming and fishing is what we do

Our resources will carry us through

We may be cut off from Chinese suppliers and others , we won't be importing any foriegn cars

A new local currency would be issued in a closed border exchange

If the world wants to cut off the USA that's their business

But china has to remember they will be laying off a huge part of it's

Work force without this customer

As our farmers plant the fields and the world has a food shortage they will again trade with America

If not we can just kick back and feed ourselves

We will still eat steak and potatoes

The cows won't go on strike

I never saw a shortage of chicken in the grocery store

Pork chops corn on the cob

Watermelon

Man we grow some nice watermelons now days

Apples oranges peachs pumpkin pie

How about some pecan pie

I'll have a pizza with sausage and peppers

Lol just goofin

We will be fine without that little piece of paper I'm sure we will have a new one the day the old expires

Do ya think they will want parts for all the machinery we sold them prior to this melt down ?

We will have plenty of business to attend to

All they can get for their holdings of dollars around the world is goods and services

The dollar isn't backed by gold

So if they want to spend them here great our economy will boom

But they can't just eliminate them unless they eliminate their own dollars that they hold

There's lots of doom and gloom story's out there

People are jealous of America

I'm not worried

Everyone doesn't suddenly become ignorant if the dollar is cut off from the world

We still know how to farm and process food we have plenty of coal powered power plants we have nuclear power

The rest of the world suffers with America out of the picture

[George Hayduke]

The rest of the world suffers with America out of the picture

 Yep.

 

To paraphrase President Coolidge: The business of the United States is doing business and, we do it pretty damn good...