Texxas777 Posted March 1, 2015 Report Share Posted March 1, 2015 Good afternoon all! Things seem to be rapidly moving to an economic end that will benefit Iraq and their citizens and us as investors. (WE ALL HOPE!!!) As an 8 year veteran of this investment I've seen/heard/experienced a lot. Lately, there's been renewed talk and rumors on a Float vs. RV/RI. Over coffee this morning my wife and I had this discussion and I would like to pose a question to you wonderful "Dinarvetinarians!" Question: "There is obviously a planned rollout of the "event" by the economic leadership of Iraq …Does Iraq benefit more economically/politically from a gradual FLOAT of the currency or from a RV/RI? Looking forward to your comments and input. Thanks Adam and all. Texx 3 Link to comment Share on other sites More sharing options...
SnowGlobe7 Posted March 1, 2015 Report Share Posted March 1, 2015 Link to comment Share on other sites More sharing options...
Luigi1 Posted March 1, 2015 Report Share Posted March 1, 2015 RV is a revaluation of a nation's currency upward or downward in comparison to a fixed locked in basket of currencies such as the USD & Euro. RI is a reinstatement of the old rate before UN sanctions were imposed on a nation's currency value. A Float is unlocking of a nation's currency upwards or downwards in respect to another nation's currency. When locked in, their currency will rise or lower to the same rate of movement as the currency it is tied to. A managed Float is usually approved by the IMF. The currency can move up or down in much larger approved increments in a short amount of time. A Fixed Float such as the USD can only revalue at no more than 2.5% a per quarter. I hope this clears up some questions. In the case of the IQD...we are looking for an RI or RV. A LOP or Re denomination is a change in a currency by removing or adding zeros without changing it's values to other currencies it is locked into. We do not want a Re-denom. 2 Link to comment Share on other sites More sharing options...
maverick101 Posted March 1, 2015 Report Share Posted March 1, 2015 Just testing the waters anybody looking for 25000 dinar notes up to 4 million uncirculated 1 Link to comment Share on other sites More sharing options...
jeepguy Posted March 2, 2015 Report Share Posted March 2, 2015 the idea at first that I was thinking , ------- the currency , to re-value at best 1 too 1 , was going to be a feasible program, { as I have read, a few of us had ideas that this would or could start out higher around the ball park of 2 .oo too 3.oo dollar range } but this rate might been a real strain on the economic picture of the new Iraq, as they would have more dinar coming in and way too much reserve going out to sustain the dinar title wave ...... mr adam montaina has spoken of values in the .10 cent range which also at this time , of Iraq politics and troubles might not be that far off ,,,,, as isis ,had or has it own bank { which I think is a farce , to recruit new terrorist } but the fact still is present ,,they are there and a thorn in the policies of Iraq and not to mention the lively hood of the average Iraqi ....... now having said this the re-calling of the 50 dinar note , they bring in a 50 dinar note and they either give money or credit in exchange ........ so they are hoping , they bring in such an amount that they will need to open bank accounts ! ...... how much can one person carry too open an account with a note that is worth .004 cents { to me I have chatted with other s there is something a foot --- going on ---- } sorry about the long banter ........... but with what I was saying ties in with the float ------- bring in lower notes and the values might start low enough to in courage banking activities though out Iraq ,,,, the 10 cents per dinar as adam mentioned .......but is that still enough too get dinar too roll in ????????? I think we better wait and see what the turn around time table for the 50 dinar note will be ! 2 months , and or extended { extended because no-one is worried about a worthless paper , to go to the bank } so the extend { we hope and increase the rate of the dinar too even close too 1 penny } then they float ---- it seems to be on what will motivate the average Iraqi too get off the couch and go to the bank ! so in short the float from 10 cents will take a little longer to take hold , and not use much in reserves ! but , give them 50 cents too 1 dollar value on each dinar ------ and the dinar will flow like the river back too central bank ! just my opinion although it was long ------- and the dollar will take a little more of the reserves but then again , they did just buy in 36 or so tons of gold ! thanks 4 Link to comment Share on other sites More sharing options...
truepatriot Posted March 2, 2015 Report Share Posted March 2, 2015 Good afternoon all! Things seem to be rapidly moving to an economic end that will benefit Iraq and their citizens and us as investors. (WE ALL HOPE!!!) As an 8 year veteran of this investment I've seen/heard/experienced a lot. Lately, there's been renewed talk and rumors on a Float vs. RV/RI. Over coffee this morning my wife and I had this discussion and I would like to pose a question to you wonderful "Dinarvetinarians!" Question: "There is obviously a planned rollout of the "event" by the economic leadership of Iraq …Does Iraq benefit more economically/politically from a gradual FLOAT of the currency or from a RV/RI? Looking forward to your comments and input. Thanks Adam and all. Texx I would love a straight up RV 1/1. In my mind that would be the best case scenario. But hey..even if there is a float;by the time it reached even 5-10 cents,I will be sorely tempted to bail out. It's like one of those rigged games people play.Like the old mountain climber game on price is right. Only this one is rigged by the banksters. I see my profits steadily rising as the cardboard yodeler climbs the fake mountain 1,000, 2,000, 4,000, 8,000, 12,000 etc etc Should I hit the buzzer now,cash out,and hurridly diversify my wealth before the coming financial crash? Or should i let greed rob my better judgement?And potentially see the Yodeling man climb over 500,000, 1 million and possibly even more? I know that the man could suddenly fall off the mountain (collapse) at any time,and I take home nothing home as well, What to choose..what to choose... 1 Link to comment Share on other sites More sharing options...
FlyHi Posted March 2, 2015 Report Share Posted March 2, 2015 (edited) To attempt to answer the OP question, my take (as a failed 1 year vet student ) is this. If a significant RV or RI event occurs, then yes, Iraq gains politically as they are able to strut with a strong currency and feel good about themselves and state they did as they told very one they would. This is a big cultural thing for them in the ME. Economically I believe this would be a backward step for them as it will hurt all exports agricultural and of course oil which is king for them. Which country would want to pay top $ for oil after a decade of cheap oil following an RY/RI event? However, if the rumors of S for oil is true even after this "RV/RI event", then the outcome is not so bad economically as they don't have to fork out reserves to pay for the IQD coming home to roost and they will have flagged to the world that we are "open for business"...which is the reform we all want to see in Iraq. The Banking sector and supporting Laws need touching up and implementing so confidence grows to invest. Good afternoon all! Things seem to be rapidly moving to an economic end that will benefit Iraq and their citizens and us as investors. (WE ALL HOPE!!!) As an 8 year veteran of this investment I've seen/heard/experienced a lot. Lately, there's been renewed talk and rumors on a Float vs. RV/RI. Over coffee this morning my wife and I had this discussion and I would like to pose a question to you wonderful "Dinarvetinarians!" Question: "There is obviously a planned rollout of the "event" by the economic leadership of Iraq …Does Iraq benefit more economically/politically from a gradual FLOAT of the currency or from a RV/RI? Looking forward to your comments and input. Thanks Adam and all. Texx A float on the other hand assuming it starts off with current rate 1165 IQD/USD would allow better economic stimulus as confidence grows in the stability and opening up to the world markets and banking sector as we would see heaps of savvy companies throw themselves at Iraq to get a foot in the door. Over time the IQD would appreciate significantly. Another option is to RV to say 0.01 to 0.10 range and float up from there...similar effect but kick starts the fenzy for investment into Iraq. They will still gain kudos (political) over time for the strengthening currency. Disclaimer.... I've gone troppo already ....I am no economic eggspurt My comments above are purely for debate by others above my pay scale! Edited March 2, 2015 by FlyHi Link to comment Share on other sites More sharing options...
Artitech Posted March 2, 2015 Report Share Posted March 2, 2015 HOOKEM!! Link to comment Share on other sites More sharing options...
SnowGlobe7 Posted March 2, 2015 Report Share Posted March 2, 2015 BEVO its whats for dinner Link to comment Share on other sites More sharing options...
tattooman1 Posted March 2, 2015 Report Share Posted March 2, 2015 Just testing the waters anybody looking for 25000 dinar notes up to 4 million uncirculated wanna trade some 50 notes for something else ? Link to comment Share on other sites More sharing options...
King Bean Posted March 2, 2015 Report Share Posted March 2, 2015 Texxas777 I will give it a try: Although a float and actual straight up RV will be managed by the CBI, they each mean a lot in terms of economic stability. The CBI states they have a lot of reserves, gold etc., to support the dinar. After all these years at an imposed rate of 1166 or more, they are dipping their toes into financial reality and world markets. IMO a straight up RV is a high risk to start out. If they RV, they have to hold an equal amount of reserves basically "locked up" to support that rate, so those reserve funds can not be used to support any other economic moves in the rebuilding of Iraq. I'd love to see them come out at $2+ or $3+, cash out my dinar and walk away. On the other hand, a float is less of a risk for the CBI. The dinar would rise (or fall) based on demand, economic growth and the strength of the other currencies it is "tied" to, like the US dollar. The CBI reserves wouldn't be locked into supporting a risky high RV rate and could instead be free to support the country and growth projects. At the same time, they can continue to funnel off some of their assets to buy more gold etc. Thus building strength of the CBI, reserves, dinar value, and continued upward growth. IMO it will come out at 1:1 and market forces will allow dinar to become strong, in demand, eventually growing to 3:1 or more, which I think "could" happen in a years time. IMO the UST would be on board with a 1:1. They get a lot of folks to cash in, get taxes too, then sit on the dinar until it eventually goes 3+ where they will use it to buy oil, which again is sold to US consumers, thus making their profits and additional gas taxes. Win Win for the US government. Disclaimer: Im going on what I have understood in 5 years of this "speculation". There are much more educated folks in these forums, whom I hope will add to my thoughts. And I like that you're discussing with your wife. Mine just wakes up and asks "are we rich yet?" 2 Link to comment Share on other sites More sharing options...
skrappyone Posted March 2, 2015 Report Share Posted March 2, 2015 I must say I am impressed by the responses everyone has given. I can tell most have done their homework and not only listened, but soaked in what what said. I have to give all of you an A+ for the job you did on the explainations. Good job folks. 2 Link to comment Share on other sites More sharing options...
TrinityeXchange Posted March 3, 2015 Report Share Posted March 3, 2015 Just thought I would paste a really good speech/address from the central bank governor of nigeria back in 2004 to the Nigeria-British Chamber of Commerce. He does a great job spelling out the benefits and drawbacks of the different exchange regimes. Enjoy - Brief Overview of Exchange Rate Regimes 5. Numerous exchange rate regimes are practiced globally, ranging from the extreme case of fixed exchange rate system, such as the currency boards and unions to a freely floating regime. In practice, countries tend to adopt an amalgam of regimes such as adjustable peg, crawling peg, target zone/crawling bands, and managed float, whichever suit their peculiar economic conditions. 6. A fixed exchange rate regime entails the pegging of the exchange rate of the domestic currency to either a unit of gold, a reference currency or a basket of currencies or the SDR, with the primary objective of ensuring a low rate of inflation. The advantages and disadvantages of the fixed regime, have been well documented in the literature. They include amongst others, the reduction of transaction cost in trade, increased macroeconomic discipline, possibility of increased credibility due to stability in the exchange rate and increased response to domestic nominal shocks. A major drawback of the fixed/pegged regimes, however, is that it implies the loss of monetary policy discretion (or monetary policy independence). 7. The floating exchange rate regime, on the other hand, implies that the forces of demand and supply will determine the exchange rate. This regime assumes the absence of any visible hand in the foreign exchange market and that the exchange rate adjusts automatically to clear any deficit or surplus in the market. Consequently, changes in the demand and supply of foreign exchange can alter exchange rates but not the country’s international reserves. In this arrangement, the exchange rate serves as a “buffer” for external shocks, thus allowing the monetary authorities full discretion in the conduct of monetary policy. The disadvantages of the freely floating regime have been documented. These include persistent exchange rate volatility, high inflation and transaction cost. By 4 far, the greatest advantage of the floating regime on the other hand, is monetary policy independence, defined in terms of a country’s ability to control its monetary aggregates and influence its domestic interest rate and inflation. 8. A variant of the freely floating regime, managed floating regime exists when government intervenes in the foreign exchange market in order to influence the exchange rate, but does not commit itself to maintaining a certain fixed exchange rate or some narrow limits around it. The central bank ‘gets its hands dirty’ by manipulating the market for foreign exchange. Depending on the central bank’s intervention, changes in the demand and supply of foreign exchange might then be associated with changes in the exchange rates and/or changes in international reserves. Under the system, fiscal and monetary policies are used to promote internal and external balance. 9. Several factors influence the choice of one regime over the other. A major consideration is the internal economic conditions or fundamentals, the external economic environment and the effect of various random shocks on the domestic economy. Thus, countries like Nigeria which are vulnerable to unstable internal financial conditions and external shocks, (including terms of trade shocks, and excessive debt burden), which require real exchange rate depreciation, tend to adopt a regime which ensures greater flexibility. Overall, there is a general consensus that a fixed exchange rate regime is preferred if the source of macroeconomic instability is predominantly endogenous. Conversely, a flexible regime is preferred if disturbances are predominantly exogenous in nature. It is, nevertheless, becoming increasingly recognized that whatever exchange rate regime a country may adopt, the long-term success depends on its commitment to the maintenance of strong economic fundamentals and a sound banking system. 2 Link to comment Share on other sites More sharing options...
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