RV is happening now

auto2nr1 · June 20, 2011

great post and thanks for sharing.

hoonos · June 20, 2011

DECISION MATRIX AND MODEL

(Iraqi Dinar 2011)

The following information is compiled from many, many hours of research. I have taken what some of you have found and quoted on this site and researched it in depth. I have been looking for several indicators in an attempt to come up with a knowledgeable model to be applied to the idealism of Revaluation not only in this instance but for the future as well. The significance of this model would be that it is based on historical fact as opposed to speculative analysis alone.

I first noticed Iraq Dinar market fluctuation during the closures of the Central Bank of Iraq (CBI) this past Christmas and I attempted to start mapping a trend type chart or program starting at this point and moving backwards. The CBI was closed for the holidays from Dec. 23^rd thru January 3^rd. CBI remained closed for several weeks after this scheduled closure in an attempt to create a shortage, however, According to the CBI this attempt only created about a 20% increased demand for the currency. In my evaluation this did not create any new demand and I can find nowhere that indicates it did. The only claim of increase was from the CBI alone. With this reported increase you would think the CBI would have held out a little longer however, if you look at the record provided by CBI the 20% increased demand did not touch the overall volume of sales and this classic supply and demand sales tactic back-fired as the lost revenue from sales versus the demand for Dinar increase was so out of proportion had they continued to hold out they would have lost the bank. I learned two very important things in this tiny piece of the puzzle. First you can’t believe anything being generated by the CBI. And it is impossible to work this scenario in as a trend or chart, let alone backwards.

So we are now starting with the plummet of the Iraqi Dinar. This will be the beginning of the point by point model that I believe can be used in the future to determine whether or not we would want to get involved in another one of these types of investments but more importantly, when we should get involved in this type of investment.

On August 6^th 1990 the United Nations Security Council (Resolution 661) announced economic sanctions and it was those sanctions that plunged the value of their Dinar from $3.22 to as low as 1/4000 of a cent. It always remained a local currency, of course, but one could not spend it in any other country, since no bank would take it in exchange for another type of currency. I believe this is where the clear differences in the Iraqi Dinar and the Kuwaiti Dinar Revaluation begin.

http://peace.mennolink.org/articles/iraqsancthist.html

These sanctions truly have teeth. What I mean by this is that before anything can happen as far as economic and eco-sociological changes, the sanctions must be lifted. How do you get a sanction lifted? Under normal circumstances the United Nations provides a list of “must completes”. If the sanctified Country complies, the compliance is reviewed and the sanctions are lifted. Are the sanctions lifted in Iraq? The United Nations lifted all sanctions on the 15^th December 2010 allowing Iraq to make monumental moves towards the rebuilding of their Country. Also noted is the fact that the oil for food (OFF) program will end on June 30^th 2011 the end of Iraq’s fiscal year.

http://www.bbc.co.uk/news/world-middle-east-12004115

On May 12 2003, Brookings’s reported the following in regards to Iraq’s oil reserves “Over the past several months, news organizations and experts have regularly cited Department of Energy (DOE) Energy Information Administration (EIA) figures claiming that the territory of Iraq contains over 112 billion barrels (bbl) of proven reserves—oil that has been definitively discovered and is expected to be economically producible. In addition, since Iraq is the least explored of the oil-rich countries, there have been numerous claims of huge undiscovered reserves there as well—oil thought to exist, and expected to become economically recoverable—to the tune of hundreds of billions of barrels. The respected Petroleum Economist Magazine estimates that there may be as many as 200 bbl of oil in Iraq; the Federation of American Scientists estimates 215 bbl; a study by the Council on Foreign Relations and the James A. Baker III Institute at Rice University claimed that Iraq has 220 bbl of undiscovered oil; and another study by the Center for Global Energy Studies and Petrolog & Associates offered an even more optimistic estimate of 300 bbl—a number that would give Iraq reserves greater even than those of Saudi Arabia.”

Iraq’s oil has fueled and will continue to fuel the importance of its successful transition and recovery to emerge as an active player in the World Market. Iraq has produced very limited oil throughout this historic transition, pursuant to the United Nations Security Councils program (Oil For Food), to a semblance of modern Democracy. With the lifting of the sanctions on Iraq, we can expect the large volume production of oil in the very near future.

http://www.brookings.edu/papers/2003/0512globalenvironment_luft.aspx

Iraq has several other Natural Resources beyond their oil these include natural gas, sulfur, phosphates and hydroelectric development opportunities. Provided the Country can keep the political system together this initial currency investment will produce a fraction of what an investment in the Country itself will produce. Iraq’s resources are both abundant and for the most part untapped.

http://www.indexmundi.com/iraq/natural_resources.html

Iraq made application to the World Trade Organization on 30 September 2004, this began the long journey toward their acceptance into the WTO. For obvious reasons Iraq could not be a member at this time if not for the UN sanctions alone. However, the process still requires a Countries application so that the WTO can produce a “WTO punch list “ that goes hand in hand with the demands of sanctification produced by the UNSC. 13^th of December 2004, The first working party was established. On 16 September 2005 the first Memorandum of intent was issued. On 28 November 2006 Question and Replies forum was held. On 25 May 2007 the first working party meeting was held. On 2 April 2008, another working party forum was held. On 8 December 2008 the first of required documentation for section a, accession (a-f) was filed and on 8 February 2008 documentation for sections a,d,e,f. Documentation for section c. has been received but is not yet posted on the WTO Accession page. Iraq is currently in Negotiations with WTO in the offered goods portion of the membership. In recent news article the following was stated and it clearly shows that Iraq is an observing member of the WTO now and desires full membership. The director of economic relations in the Federal Trade ministry said on Monday that” his ministry backed the World Trade Organization (WTO)’s decision to enter into a third round of negotiations over granting Iraq permanent membership. Hashem Hatem told AKnews that Iraq is working to a well-prepared plan to raise its status from observing member to permanent member of the WTO without affecting the country’s internal economic situation.” http://www.wto.org/english/thewto_e/acc_e/a1_iraq_e.htm

http://www.iraq-businessnews.com/2011/02/01/iraq-seeks-permanent-membership-of-wto/

Iraq has an adaptation of the old Parliamentary government with a Democracy twist. The transition from the traditional Dictatorship to this type of government is very difficult. Add this to the fact that the Country is ready to implode and has been for since its existence the process takes even longer and is straining to the limit at best. What seems to happen is that the will of the people shine through the worst adversity provided the majority wants some semblance of personal freedom. Once freedom has been tasted it is a very difficult thing to forget. I believe that World interests are vested in seeing this Country make it. For that reason the ultra conservative or the hesitant need not ponder as I believe their opportunity for fortune will be here and gone before a decision to invest is rendered. This is truly fly by the seat of your pants investing, however, we are going over a very strong list of indicators that makes not only your currency investment solid, but also paves the road for some long term high yield plays. I am not going to include any links to qualify this portion of the analysis, as it is obvious that this portion is more than confirmed.

Note: I am in no way qualified nor am I attempting to give investment or financial advise of any kind. I am simply sharing with you my conclusion of research I have performed in hopes of making some sense out of the Revaluation experience.

At a time when nongovernmental economic establishments called for expediting approving of the next year’s (2011) budget and cutting down the operational expenditures to reach the lowest rate of deficit, Othman al-Juhayshi, member of the Iraqi parliament for the Al-Iraqiya list, said that the political blocs have agreed at the meeting held last Saturday to complete the formation of the parliamentary committees and authorize the Financial Committee to study the budget for next year to approve it within the next few weeks after the blessed Id al-Adha.

The Iraqi Finance Ministry has already announced that it worked out the budget for next year at $86.4 billion, which is more by $14 billion than the current budget.

A statement by the Economic Media Center, a copy of which was obtained by Asharq Al-Awsat, said that “at a time when the Center welcomes the convening of the Council of Representatives, the next task that it is supposed to shoulder is to expedite the formation of its committees to carry out their missions, including the Economic Committee which shoulders the responsibility of studying the general budget and working out the suggested amendments to its articles, which have become necessary to be discussed and approved to avoid the delay that is taking place in the budget of last year, in addition to making it binding for the Finance Minister to prepare a closing balance after each fiscal year to show the size of the financial transactions and the volume of the real expenditures and the mechanisms for offsetting the budget deficit, which are right mechanisms that should be followed in accurately working out the budget to estimate the deficit in a real and objective way.”

It added: While the Center urges the Council of Representatives to quickly approve the budget, it is at the same time calling for further scrutinizing the articles of the operational spending and to trying to cut down the operational expenditures in a manner that does not have an impact on the state general performance in order to reach the lowest possible budget deficit in light of the advance announcement about the possibility that the budget deficit may reach about 18 trillion dinars (more than $15 billion) this year in spite of the expectation of a rise in Iraq’s oil exports, and subsequently, a growth in the revenues from oil sales. In earlier statements, Fadil Nabi, undersecretary of the Finance Ministry, said that his country “has suggested a budget for next year by $86.4 billion.” Nabi added that “Iraq has submitted an initial draft budget for 2011 at 102 trillion dinars ($86.3 billion)” assuming that the international price of oil is $70 per barrel.

Iraq depends on its oil revenues to finance about 95 percent of its budget. Iraq, an OPEC member state, signed agreements with international oil companies that may increase its output capacity within 6-7 years to 12 million barrels a day from the current 2.5 million barrels a day, which would make it a competitor of Saudi Arabia, the largest crude producer in the world. According to the assurances of the Finance Ministry’s undersecretary “the budget is currently at the Council of Ministers and will be sent to the parliament after the formation of its committees.”

For his part, Dr Othman al-Juhayshi, the deputy for the Al-Iraqiya list, told Asharq Al-Awsat that “the budget of next year should have been approved one month before now, but the delay in the parliamentary sessions and the crisis of forming the government prevented this. As all know, approving the budget requires enough study by the Financial Committee to amend, add, and delete [whatever is necessary] and then it should be subjected for the first and second readings at the Council of Representatives before a vote takes place on it. These articles certainly require time, and this is what the new parliament does not have.”

He disclosed that “all the [political] blocs have agreed at the last session on the need for expediting the formation of the committees after Id al-Adha, and to send a message from the Council of Representatives to the government to ask it to submit the budget to the parliament to approve it. Hence, the budget is one of our priorities at present in light of its importance and to prevent obstructing the government’s work in all that is related to the citizens, pointing out that delaying approving the budget of 2011 has taken place due to the problems between the blocs because the elections were about to be held. The government became a care taker government, and the delay has negatively affected all state institutions, and we do not want to repeat this again.” The parliament last January approved the 2010 budget at $72.4 with a deficit by $19.6 assuming that the oil price is $62.50 per barrel.

For his part Mazhar Muhammad Saleh, expert of the Iraqi Central Bank, said in a statement to Asharq Al-Awsat that “the issue of estimating Iraq’s budget for next year is a very complicated issue and depends on several scenarios, including the daily anticipations, such as the rates at the financial markets and the oil markets, and the international expectations for the next stage was between $80-85 per barrel within the framework of OPEC market. In Iraq, the price is lower by $7 than the expectations for the international market.”

He said that “Iraq’s budget mainly depends on oil sales, which means that it has one source, and last year it was expected to sell 2.15 million barrel a day, and the current output is still low and below 2 million barrel for several reasons that deal with exports, transportation lines, and others.”

On the anticipated figures in the budget of next year, Salih said: “There are two articles in the budget, which are the operational and investment allocations, and hence, we should think of how much can we reduce the first and increase the second for the purposes of development and investments in particular. We have expected a growth rate by 9.4 percent, which is an ambitious rate that is close to that of China.”

The current government is facing a wave of criticism because it has not submitted its closing accounts of the government budgets since 2005 and until now, and there are demands to refer the issue to the monitoring and judicial quarters because these accounts should have been discussed and approved by the parliament. The Electricity Ministry demanded allocating a sum of 7 trillion and 806 billion dinars ($6.7 billion) from the budget of next year to cover the spending on its projects in the field of developing the electricity sector, which were approved by the government.

This was announced by Musab Siri al-Mudarris, the official spokesman for the ministry, who added that the Ministry of Planning has proposed allocating 5 trillion, 266 billion, and 650 million
Iraqi dinars ($4.5 billion) as an investment budget for the Ministry of Electricity, and considered it a large budget compared with the previous years. He stressed that these funds are not enough to achieve the investment projects of the ministry, pointing out that there are funds that are due to be paid by the ministry within the framework of the projects that have implemented this year and the previous years, including 2 trillion and 925 billion dinars from the treasury; therefore, they should be returned to the state treasury next year, and the ministry is bound to pay other funds that will be due in 2011.

“ Iraq is not spending much of its own money, despite soaring oil revenues that are pushing the country toward a massive budget surplus, U.S. auditors told Congress on Tuesday.”

http://www.msnbc.msn.com/id/23578542/

http://iraqdailytimes.com/iraqs-2011-budget/

Iraq has a solid Financial base infrastructure in place. Although Central Bank of Iraq is difficult to pin down in regards to accurate information they are in fact a going concern. The Bank of Baghdad has recently signed an agreement to partner with Citi Bank. If we are looking at the banking industry in Iraq for solidity in the beginning of a new Iraq it doesn’t get any better than this.

http://www.cbi.iq/

http://www.arabtimesonline.com/NewsDetails/tabid/96/smid/414/ArticleID/169718/reftab/36/t/Citi-Bank-of-Baghdad-announce-tie-up/Default.aspx

With the United States of America at the top of the list as foreign investors it assures us that we will more likely than not prevail in this initial investment. The US has gone so far as to hire a private law firm to assist Iraq with claims against them for debt owed under the old Hussein Regime. The United Kingdom is also vested in the new Iraq. There are many more but I feel these to super powers more than suffice as the indicator needed to make solid decisions. Couple that with the former Presidents involvement and I really don’t need anymore. I am having a difficult time establishing solid proof that Mr. Bush was in Iraq in March 2011. I have however included the link establishing Mr. Bush in Iraq last October. In that article it becomes clear that he is there, taking care of his interests via Halliburton Inc. where former Vice President **** Cheney is still seated as Vice Chairman.

http://articlesofinterest-kelley.blogspot.com/2010/10/george-w-bush-in-kuwait-on-wednesday.html

My evaluation of an investment in foreign currency Revaluation

1. When did the Currency Devalue and what was its value prior to the Devalue?

2. Are there United Nations Security Counsel Sanctions? If so how long have they been in place and when are they up for a review to be lifted?

3. What is the Country’s Gross National Product and are they producing? If no is the answer, what is stopping them? If yes is the answer, are they growing.

4. What is the Country’s Natural Resource situation, dependent on others, co-dependent, or independent?

5. Is the Country trading on the World Market? Are they Members of the World Trade Organization? If not, have they completed an application for Membership?

6. What political system is in use? Parliamentary, Democracy, Dictatorship and so on? Is it solid? If not, where in the particular respected Governments process, is it?

7. Is the Country operating under a budget? If so how long has it been in place? If not when is one anticipated.

8. What’s the Countries Financial Infrastructure look like? Banks in play?

9. What Countries are involved? What significant investors are involved?

10. What is the anticipated return on the investment? Is the projected return consistent with the historical examples found in other Countries

Returns on this investment seem to be indicative of the past Revaluations I have historically researched. I believe that the Iraq Dinar must revalue at its original 3.22 USD to 1 IQD plus regional inflation and cost of living. Here is how I came to this rate. Historically no devalued currency falling into the Iraq scenario has ever revalued less than it’s worth prior to the devaluation. As a matter of fact no currency that I can find has ever, in this scenario, come in at the old rate prior to devalue, but rather it has revalued at a higher rate. Take this information and couple it with some speculative factors to include the following. The Iraqi people had money in the bank when this devalue of their currency occurred. Do we really think that the Iraqi people would accept a loss? I do not. I see them rioting in the streets, a complete chaotic cue. No Iraq must bring the value to the currency back the original rate at the very least. Lastly consider the amounts of oil that Iraq has. They will be bringing this oil to market. This said, the Iraqi currency must have parity with the rest of the Oil producing Nations. There will be global market disruptions and turmoil. To attempt to bring Iraq forward with anything other than consistent competitive pricing just simply will not happen. To do this would be irresponsible and again it just wont happen. Expect a rate consistent with the rest of the top producing oil Countries.

CONCLUSION

The Iraq Dinar is a once in a lifetime opportunity to achieve financial freedom. With this simple but historically factual model, coupled with reasonable speculation, you can easily draw a clear picture of the outcome of this incredible opportunity. In laying the model next to the Kuwaiti Revaluation you will find that if you remove the UN sanctions from this scenario the RV’s time lines are synonymous, This being said get ready for the official announcement very, very soon and understand clearly that the RV we have all been waiting for is not a one day event but rather is a process that began when the UN Sanctions were lifted. That’s right the RV is in progress….. We are waiting for it to finalize. Your investment is already in play.

I want to be the first to congratulate you on your success.

God bless all of you.

“Quietlearner”

Monday, June 20, 2011

but is not saudi arabia the top producer/exporter with a rate of 27 cents per whatever ????????????

quadraph0nic · June 20, 2011

I sure appreciate the input quadraphonic the reason I did not get into those areas is the only senario I can find that includes these is this one. I have been unable to find any of the LOP theories that can apply to this situation. LOP exists im sure but to apply it to this scenario is difficult as it has never occurred in past RV,s that have the same situational elements as this.(occupation and war) The great majority of my post is based on historical fact. The few places that I have speculated are I hope clear. I dont think investment is possible without some speculation.

Oh I'm not trying to argue that a LOP will happen but we are definitely not out of the forest. There have been many here that have made a strong argument for that as a possibility. That 1168 to the dollar exchange rate is not something exaggerated. If you look at the key financials from cbi's website you can see the reserves to their M2 and its been favorable the last couple of months as far as I can tell but they back their currency 100%. There was even an article when they first came out with this dinar where Shabibi said this was unfair to carry over all of Sadam's doing to the new currency...that's why we are able to buy it so cheap. Aside from some appreciation all theyve done is sell the dinar and strengthen their reserves. Will they make the decision to increase the purchase power of the dinar without cutting the money supply ie remove three zeros? That is the crux of this investment. Iraq is not like any other nation with the vast resources it posses and I don't think they should LOP but that possibility is there until a decision is implemented. Per the MOP and an IMF report from last year, I believe this is the year that they will allow it to appreciate based on what they have done up to this point but I don't expect an overnight RV for a 1 to 1 exchange rate that would be an increase of what? a 1000% How about 3.22?? 3000%?

Has that ever happened in history? If so please point that out and I say that with zero sarcasm.

I'm not saying an RV can't happen because there is a first for everything but that's what a lot of people here expect.

I've often wondered what kind of monetary policy would they need to do to meet these expectations in regards to reserves to money supply? Maybe completely do away with that system? Just make it up? You need two sides to make a transaction right?

but is it safe to expect this to happen?

Sorry I couldnt find the article on shabibi its very old. I found it when I ran across this professor from north carolina who was consulted to help design the Iraqi dinar. I forgot that guys name too. I admit I suck at taking notes. Maybe someone else can provide that bit. Sorry

countryroads · June 20, 2011

When someone can prove that they were present, in person, when all these so called wonderful facts are coming out of the Iraqi government, I might give it a second look. Untill then I just pass over it. <_< <_<

drox · June 20, 2011

Quietlearner... I applaud the effort but you left enormous gaping holes in your research to reach such crazy conclusions. I am all for you peeling the onion and offering us articles and your thoughts... but to jump to the conclusion of $3.22 and then attempting to call this a "model" is just plain silly. Things to ask yourself and consider.

1. DFI is still in existence

2. Oil metering is incomplete

3. Kuwait is still owed $20 Billion.

4. Read Article 4 of the Articles of Agreement with the IMF and tell me how in the Earth you think IMF would allow your rate.

5. Please read up on how the Dinar got to $3.22 in the first place. Hint: Think of Saddam and printing money at his leisure. Then think of him telling the world what the currency is worth artificially without anyone else agreeing with it or supporting it. Then... think about how much he printed and then think about the Swiss Dinar and black market effect. They went from 25 Billion to now somewhere around 27 Trillion M2.

6. Read up on all of the World Bank, WTO punch list item requirements of Iraq for simply social services alone. Cross reference that to the present state of affairs in Iraq today.

7. The revolution of banking is not nearly complete although progress has certainly been made. Only 4.5 million people out of some 30 million have deposits in banks.

8. Your model does not account for populations, for M2, GDP, income per capita, import/export concerns, security, corruption indexing, unemployment, taxation, borrowing ability, currency conversion....blah blah blah... in your comparison to other arab countries.

9. INFRASTRUCTURE

10. Privatization of all the government owned industry.

11. Oil revenue makes up 95% of the GDP yet only 2% of the population of Iraq is employed by that industry!!!!

12. Maliki just ran off the best banking executive in the country that was the caretaker of the numerous GOI ministry accounts! How scary is that??

13. Maliki wanted to use all of the CBI reserves just a few months ago to cover budget deficits and other things the GOI needed. How would that have helped you back up your $3.22 RV?

14. The current investment law from 2006 is antiquated and unfair to the Iraqi businessmen and citizen in lieu of international investing. It also supports corruption through the numerous loop holes.

15. Post $3.22 RV please tell me... will the cost of goods in Iraq remain the same or will they increase 3000 times as well?? How about salaries for Iraqis?? How about taxes on both of those items just mentioned??

16. If 1/3rd of Iraqi's are unemployed, and another 1/3rd have no savings... please tell me how an $3.22 RV will help that 2/3rds of the population? If 1/3rd will now become ridiculously rich do you think the 2/3rds that will remain poor will be a little bit P.O.'d??? Will the merchant raise his prices for the rich or leave them static for the majority of poor? Which would you do if you were the merchant? Now... think of that gigantic wealth chasm it would create in society. Now picture Iraq trying to keep the peace when security is already a nightmare. How will that work out? Through the leadership of their strong united politicians?

17. HCL, Article 140, Kirkuk, Iranian influence, Sadr's army, Maliki's "Black Bat" militia, Kuwait Demarcation of the borders and antiquities, the UN monitoring, etc etc.

This will RV and increase in value. How much and how soon is the question. Please work on your model some more and get back to us when you do some more research. Thanks.

Kimberlye · June 20, 2011

QuietLearner, thank you so much for the obvious research and hard work that you put into this. You didn't have to share it with us, but you did. Thank you so much. You are very much appreciated. I look forward to further works and comments from you. And thanks for simplifying it for those of those that are not financial or investment gurus, in every sense of the word.

Enjoy your day,

Kimberlye

P.S. You've obviously been sitting back and quietly learning.

Edited June 20, 2011 by Kimberlye

umbertino · June 20, 2011

QL..Thanks for your research and the time and effort you put into it.

speculatorsRIDE · June 20, 2011

Oh I'm not trying to argue that a LOP will happen but we are definitely not out of the forest. There have been many here that have made a strong argument for that as a possibility. That 1168 to the dollar exchange rate is not something exaggerated. If you look at the key financials from cbi's website you can see the reserves to their M2 and its been favorable the last couple of months as far as I can tell but they back their currency 100%. There was even an article when they first came out with this dinar where Shabibi said this was unfair to carry over all of Sadam's doing to the new currency...that's why we are able to buy it so cheap. Aside from some appreciation all theyve done is sell the dinar and strengthen their reserves. Will they make the decision to increase the purchase power of the dinar without cutting the money supply ie remove three zeros? That is the crux of this investment. Iraq is not like any other nation with the vast resources it posses and I don't think they should LOP but that possibility is there until a decision is implemented. Per the MOP and an IMF report from last year, I believe this is the year that they will allow it to appreciate based on what they have done up to this point but I don't expect an overnight RV for a 1 to 1 exchange rate that would be an increase of what? a 1000% How about 3.22?? 3000%?

Has that ever happened in history? If so please point that out and I say that with zero sarcasm.

I'm not saying an RV can't happen because there is a first for everything but that's what a lot of people here expect.

I've often wondered what kind of monetary policy would they need to do to meet these expectations in regards to reserves to money supply? Maybe completely do away with that system? Just make it up? You need two sides to make a transaction right?

but is it safe to expect this to happen?

Sorry I couldnt find the article on shabibi its very old. I found it when I ran across this professor from north carolina who was consulted to help design the Iraqi dinar. I forgot that guys name too. I admit I suck at taking notes. Maybe someone else can provide that bit. Sorry

If it makes you feel any better Quad, Scooter said that the lop articles being released are old articles meant to confuse the speculators. The raising 000 notes study was completed in 2007. The results of the study are posted on the Ministry of Finance Site. He said unequivocally that there will be NO LOP. If you take the time to listen to the CC that Roger conducted with Scooter and Rudy (Yes, the one that caused the drama of late) you will hear Scooter say it himself. They get into the lop talk right about 1 hour into the 2 hour call.

pro1 · June 20, 2011

I think you guys better take a look at the bloomberg thread that just hit the forum

looks like a lop to me? bummer

F-16Pilot · June 20, 2011

Quietlearner... I applaud the effort but you left enormous gaping holes in your research to reach such crazy conclusions. I am all for you peeling the onion and offering us articles and your thoughts... but to jump to the conclusion of $3.22 and then attempting to call this a "model" is just plain silly. Things to ask yourself and consider.

1. DFI is still in existence

2. Oil metering is incomplete

3. Kuwait is still owed $20 Billion.

4. Read Article 4 of the Articles of Agreement with the IMF and tell me how in the Earth you think IMF would allow your rate.

5. Please read up on how the Dinar got to $3.22 in the first place. Hint: Think of Saddam and printing money at his leisure. Then think of him telling the world what the currency is worth artificially without anyone else agreeing with it or supporting it. Then... think about how much he printed and then think about the Swiss Dinar and black market effect. They went from 25 Billion to now somewhere around 27 Trillion M2.

6. Read up on all of the World Bank, WTO punch list item requirements of Iraq for simply social services alone. Cross reference that to the present state of affairs in Iraq today.

7. The revolution of banking is not nearly complete although progress has certainly been made. Only 4.5 million people out of some 30 million have deposits in banks.

8. Your model does not account for populations, for M2, GDP, income per capita, import/export concerns, security, corruption indexing, unemployment, taxation, borrowing ability, currency conversion....blah blah blah... in your comparison to other arab countries.

9. INFRASTRUCTURE

10. Privatization of all the government owned industry.

11. Oil revenue makes up 95% of the GDP yet only 2% of the population of Iraq is employed by that industry!!!!

12. Maliki just ran off the best banking executive in the country that was the caretaker of the numerous GOI ministry accounts! How scary is that??

13. Maliki wanted to use all of the CBI reserves just a few months ago to cover budget deficits and other things the GOI needed. How would that have helped you back up your $3.22 RV?

14. The current investment law from 2006 is antiquated and unfair to the Iraqi businessmen and citizen in lieu of international investing. It also supports corruption through the numerous loop holes.

15. Post $3.22 RV please tell me... will the cost of goods in Iraq remain the same or will they increase 3000 times as well?? How about salaries for Iraqis?? How about taxes on both of those items just mentioned??

16. If 1/3rd of Iraqi's are unemployed, and another 1/3rd have no savings... please tell me how an $3.22 RV will help that 2/3rds of the population? If 1/3rd will now become ridiculously rich do you think the 2/3rds that will remain poor will be a little bit P.O.'d??? Will the merchant raise his prices for the rich or leave them static for the majority of poor? Which would you do if you were the merchant? Now... think of that gigantic wealth chasm it would create in society. Now picture Iraq trying to keep the peace when security is already a nightmare. How will that work out? Through the leadership of their strong united politicians?

17. HCL, Article 140, Kirkuk, Iranian influence, Sadr's army, Maliki's "Black Bat" militia, Kuwait Demarcation of the borders and antiquities, the UN monitoring, etc etc.

This will RV and increase in value. How much and how soon is the question. Please work on your model some more and get back to us when you do some more research. Thanks.

Drox,

Please enlighten us with your well thought model and, if possible, compare and contrast your's with QL's. Charts would be nice and please don't spare the colors.

THINK..... · June 20, 2011

Hey Think heres the Link BBC check it out http://www.bbc.co.uk/news/world-middle-east-12004115

hope your feeling better.

That's dated 15 December 2010. Is someone forgetting about current chapter VII???????

I feel much better now, thank you.

tjmunson · June 20, 2011

I think you guys better take a look at the bloomberg thread that just hit the forum

looks like a lop to me? bummer

How would this lead to believe in a LOP??? There will be no LOP. That would be disasterous for Iraq. Aint gonna happen. This thread to me could very well be talking about the new lower denoms. I would bet you ALL MY DINAR that there is absolutely NO new currency being issued other than lower denoms. If they ever came out with a new currency and claimed the current to be null and void, they would, in one fell swoop, alienate themselves from every government in the world because they too would be holding worthless currency. I assure you this is not the case.

pro1 · June 20, 2011

the thumbnail in that bloomberg post says "Iraq plans to slash 3 digits from its national currency" thats how I infer it to mean lop.... dont know if the post is for real but thats my summary based on the thumbnail in that post. look for yourself. What else can slash 3 digits mean? Im up for being educated. please school me. thanks!

jeepguy · June 20, 2011

hey --- don `t beat him up too bad { hahahaha} good work Q-L lot of info ----also good responce every one high 5 `s ----if it was 3.22 sadam rate ---those peskey zero`s again in my opinion--after hearing shaibbi in the washington post by the news reals { it will be big } if i hear right ------> .00086--->.86 that is a great start this is a very cool event every one { history in the making REALLY } if this comes in like we are thinking ,,,this will be one of the most popular talks around every street for years,,,,it boggles the mind ,,,,,,so every one please stay calm,,don`t freak out,,,wait read ,,,,and let the r-v begin------> bayyyyyyyyyyyyyybeeeeeeeeeeee

joekooltrips · June 20, 2011

DECISION MATRIX AND MODEL

(Iraqi Dinar 2011)

The following information is compiled from many, many hours of research. I have taken what some of you have found and quoted on this site and researched it in depth. I have been looking for several indicators in an attempt to come up with a knowledgeable model to be applied to the idealism of Revaluation not only in this instance but for the future as well. The significance of this model would be that it is based on historical fact as opposed to speculative analysis alone.

I first noticed Iraq Dinar market fluctuation during the closures of the Central Bank of Iraq (CBI) this past Christmas and I attempted to start mapping a trend type chart or program starting at this point and moving backwards. The CBI was closed for the holidays from Dec. 23^rd thru January 3^rd. CBI remained closed for several weeks after this scheduled closure in an attempt to create a shortage, however, According to the CBI this attempt only created about a 20% increased demand for the currency. In my evaluation this did not create any new demand and I can find nowhere that indicates it did. The only claim of increase was from the CBI alone. With this reported increase you would think the CBI would have held out a little longer however, if you look at the record provided by CBI the 20% increased demand did not touch the overall volume of sales and this classic supply and demand sales tactic back-fired as the lost revenue from sales versus the demand for Dinar increase was so out of proportion had they continued to hold out they would have lost the bank. I learned two very important things in this tiny piece of the puzzle. First you can’t believe anything being generated by the CBI. And it is impossible to work this scenario in as a trend or chart, let alone backwards.

So we are now starting with the plummet of the Iraqi Dinar. This will be the beginning of the point by point model that I believe can be used in the future to determine whether or not we would want to get involved in another one of these types of investments but more importantly, when we should get involved in this type of investment.

On August 6^th 1990 the United Nations Security Council (Resolution 661) announced economic sanctions and it was those sanctions that plunged the value of their Dinar from $3.22 to as low as 1/4000 of a cent. It always remained a local currency, of course, but one could not spend it in any other country, since no bank would take it in exchange for another type of currency. I believe this is where the clear differences in the Iraqi Dinar and the Kuwaiti Dinar Revaluation begin.

http://peace.mennolink.org/articles/iraqsancthist.html

These sanctions truly have teeth. What I mean by this is that before anything can happen as far as economic and eco-sociological changes, the sanctions must be lifted. How do you get a sanction lifted? Under normal circumstances the United Nations provides a list of “must completes”. If the sanctified Country complies, the compliance is reviewed and the sanctions are lifted. Are the sanctions lifted in Iraq? The United Nations lifted all sanctions on the 15^th December 2010 allowing Iraq to make monumental moves towards the rebuilding of their Country. Also noted is the fact that the oil for food (OFF) program will end on June 30^th 2011 the end of Iraq’s fiscal year.

http://www.bbc.co.uk/news/world-middle-east-12004115

On May 12 2003, Brookings’s reported the following in regards to Iraq’s oil reserves “Over the past several months, news organizations and experts have regularly cited Department of Energy (DOE) Energy Information Administration (EIA) figures claiming that the territory of Iraq contains over 112 billion barrels (bbl) of proven reserves—oil that has been definitively discovered and is expected to be economically producible. In addition, since Iraq is the least explored of the oil-rich countries, there have been numerous claims of huge undiscovered reserves there as well—oil thought to exist, and expected to become economically recoverable—to the tune of hundreds of billions of barrels. The respected Petroleum Economist Magazine estimates that there may be as many as 200 bbl of oil in Iraq; the Federation of American Scientists estimates 215 bbl; a study by the Council on Foreign Relations and the James A. Baker III Institute at Rice University claimed that Iraq has 220 bbl of undiscovered oil; and another study by the Center for Global Energy Studies and Petrolog & Associates offered an even more optimistic estimate of 300 bbl—a number that would give Iraq reserves greater even than those of Saudi Arabia.”

Iraq’s oil has fueled and will continue to fuel the importance of its successful transition and recovery to emerge as an active player in the World Market. Iraq has produced very limited oil throughout this historic transition, pursuant to the United Nations Security Councils program (Oil For Food), to a semblance of modern Democracy. With the lifting of the sanctions on Iraq, we can expect the large volume production of oil in the very near future.

http://www.brookings.edu/papers/2003/0512globalenvironment_luft.aspx

Iraq has several other Natural Resources beyond their oil these include natural gas, sulfur, phosphates and hydroelectric development opportunities. Provided the Country can keep the political system together this initial currency investment will produce a fraction of what an investment in the Country itself will produce. Iraq’s resources are both abundant and for the most part untapped.

http://www.indexmundi.com/iraq/natural_resources.html

Iraq made application to the World Trade Organization on 30 September 2004, this began the long journey toward their acceptance into the WTO. For obvious reasons Iraq could not be a member at this time if not for the UN sanctions alone. However, the process still requires a Countries application so that the WTO can produce a “WTO punch list “ that goes hand in hand with the demands of sanctification produced by the UNSC. 13^th of December 2004, The first working party was established. On 16 September 2005 the first Memorandum of intent was issued. On 28 November 2006 Question and Replies forum was held. On 25 May 2007 the first working party meeting was held. On 2 April 2008, another working party forum was held. On 8 December 2008 the first of required documentation for section a, accession (a-f) was filed and on 8 February 2008 documentation for sections a,d,e,f. Documentation for section c. has been received but is not yet posted on the WTO Accession page. Iraq is currently in Negotiations with WTO in the offered goods portion of the membership. In recent news article the following was stated and it clearly shows that Iraq is an observing member of the WTO now and desires full membership. The director of economic relations in the Federal Trade ministry said on Monday that” his ministry backed the World Trade Organization (WTO)’s decision to enter into a third round of negotiations over granting Iraq permanent membership. Hashem Hatem told AKnews that Iraq is working to a well-prepared plan to raise its status from observing member to permanent member of the WTO without affecting the country’s internal economic situation.” http://www.wto.org/english/thewto_e/acc_e/a1_iraq_e.htm

http://www.iraq-businessnews.com/2011/02/01/iraq-seeks-permanent-membership-of-wto/

Iraq has an adaptation of the old Parliamentary government with a Democracy twist. The transition from the traditional Dictatorship to this type of government is very difficult. Add this to the fact that the Country is ready to implode and has been for since its existence the process takes even longer and is straining to the limit at best. What seems to happen is that the will of the people shine through the worst adversity provided the majority wants some semblance of personal freedom. Once freedom has been tasted it is a very difficult thing to forget. I believe that World interests are vested in seeing this Country make it. For that reason the ultra conservative or the hesitant need not ponder as I believe their opportunity for fortune will be here and gone before a decision to invest is rendered. This is truly fly by the seat of your pants investing, however, we are going over a very strong list of indicators that makes not only your currency investment solid, but also paves the road for some long term high yield plays. I am not going to include any links to qualify this portion of the analysis, as it is obvious that this portion is more than confirmed.

Note: I am in no way qualified nor am I attempting to give investment or financial advise of any kind. I am simply sharing with you my conclusion of research I have performed in hopes of making some sense out of the Revaluation experience.

At a time when nongovernmental economic establishments called for expediting approving of the next year’s (2011) budget and cutting down the operational expenditures to reach the lowest rate of deficit, Othman al-Juhayshi, member of the Iraqi parliament for the Al-Iraqiya list, said that the political blocs have agreed at the meeting held last Saturday to complete the formation of the parliamentary committees and authorize the Financial Committee to study the budget for next year to approve it within the next few weeks after the blessed Id al-Adha.

The Iraqi Finance Ministry has already announced that it worked out the budget for next year at $86.4 billion, which is more by $14 billion than the current budget.

A statement by the Economic Media Center, a copy of which was obtained by Asharq Al-Awsat, said that “at a time when the Center welcomes the convening of the Council of Representatives, the next task that it is supposed to shoulder is to expedite the formation of its committees to carry out their missions, including the Economic Committee which shoulders the responsibility of studying the general budget and working out the suggested amendments to its articles, which have become necessary to be discussed and approved to avoid the delay that is taking place in the budget of last year, in addition to making it binding for the Finance Minister to prepare a closing balance after each fiscal year to show the size of the financial transactions and the volume of the real expenditures and the mechanisms for offsetting the budget deficit, which are right mechanisms that should be followed in accurately working out the budget to estimate the deficit in a real and objective way.”

It added: While the Center urges the Council of Representatives to quickly approve the budget, it is at the same time calling for further scrutinizing the articles of the operational spending and to trying to cut down the operational expenditures in a manner that does not have an impact on the state general performance in order to reach the lowest possible budget deficit in light of the advance announcement about the possibility that the budget deficit may reach about 18 trillion dinars (more than $15 billion) this year in spite of the expectation of a rise in Iraq’s oil exports, and subsequently, a growth in the revenues from oil sales. In earlier statements, Fadil Nabi, undersecretary of the Finance Ministry, said that his country “has suggested a budget for next year by $86.4 billion.” Nabi added that “Iraq has submitted an initial draft budget for 2011 at 102 trillion dinars ($86.3 billion)” assuming that the international price of oil is $70 per barrel.

Iraq depends on its oil revenues to finance about 95 percent of its budget. Iraq, an OPEC member state, signed agreements with international oil companies that may increase its output capacity within 6-7 years to 12 million barrels a day from the current 2.5 million barrels a day, which would make it a competitor of Saudi Arabia, the largest crude producer in the world. According to the assurances of the Finance Ministry’s undersecretary “the budget is currently at the Council of Ministers and will be sent to the parliament after the formation of its committees.”

For his part, Dr Othman al-Juhayshi, the deputy for the Al-Iraqiya list, told Asharq Al-Awsat that “the budget of next year should have been approved one month before now, but the delay in the parliamentary sessions and the crisis of forming the government prevented this. As all know, approving the budget requires enough study by the Financial Committee to amend, add, and delete [whatever is necessary] and then it should be subjected for the first and second readings at the Council of Representatives before a vote takes place on it. These articles certainly require time, and this is what the new parliament does not have.”

He disclosed that “all the [political] blocs have agreed at the last session on the need for expediting the formation of the committees after Id al-Adha, and to send a message from the Council of Representatives to the government to ask it to submit the budget to the parliament to approve it. Hence, the budget is one of our priorities at present in light of its importance and to prevent obstructing the government’s work in all that is related to the citizens, pointing out that delaying approving the budget of 2011 has taken place due to the problems between the blocs because the elections were about to be held. The government became a care taker government, and the delay has negatively affected all state institutions, and we do not want to repeat this again.” The parliament last January approved the 2010 budget at $72.4 with a deficit by $19.6 assuming that the oil price is $62.50 per barrel.

For his part Mazhar Muhammad Saleh, expert of the Iraqi Central Bank, said in a statement to Asharq Al-Awsat that “the issue of estimating Iraq’s budget for next year is a very complicated issue and depends on several scenarios, including the daily anticipations, such as the rates at the financial markets and the oil markets, and the international expectations for the next stage was between $80-85 per barrel within the framework of OPEC market. In Iraq, the price is lower by $7 than the expectations for the international market.”

He said that “Iraq’s budget mainly depends on oil sales, which means that it has one source, and last year it was expected to sell 2.15 million barrel a day, and the current output is still low and below 2 million barrel for several reasons that deal with exports, transportation lines, and others.”

On the anticipated figures in the budget of next year, Salih said: “There are two articles in the budget, which are the operational and investment allocations, and hence, we should think of how much can we reduce the first and increase the second for the purposes of development and investments in particular. We have expected a growth rate by 9.4 percent, which is an ambitious rate that is close to that of China.”

The current government is facing a wave of criticism because it has not submitted its closing accounts of the government budgets since 2005 and until now, and there are demands to refer the issue to the monitoring and judicial quarters because these accounts should have been discussed and approved by the parliament. The Electricity Ministry demanded allocating a sum of 7 trillion and 806 billion dinars ($6.7 billion) from the budget of next year to cover the spending on its projects in the field of developing the electricity sector, which were approved by the government.

This was announced by Musab Siri al-Mudarris, the official spokesman for the ministry, who added that the Ministry of Planning has proposed allocating 5 trillion, 266 billion, and 650 million
Iraqi dinars ($4.5 billion) as an investment budget for the Ministry of Electricity, and considered it a large budget compared with the previous years. He stressed that these funds are not enough to achieve the investment projects of the ministry, pointing out that there are funds that are due to be paid by the ministry within the framework of the projects that have implemented this year and the previous years, including 2 trillion and 925 billion dinars from the treasury; therefore, they should be returned to the state treasury next year, and the ministry is bound to pay other funds that will be due in 2011.

“ Iraq is not spending much of its own money, despite soaring oil revenues that are pushing the country toward a massive budget surplus, U.S. auditors told Congress on Tuesday.”

http://www.msnbc.msn.com/id/23578542/

http://iraqdailytimes.com/iraqs-2011-budget/

Iraq has a solid Financial base infrastructure in place. Although Central Bank of Iraq is difficult to pin down in regards to accurate information they are in fact a going concern. The Bank of Baghdad has recently signed an agreement to partner with Citi Bank. If we are looking at the banking industry in Iraq for solidity in the beginning of a new Iraq it doesn’t get any better than this.

http://www.cbi.iq/

http://www.arabtimesonline.com/NewsDetails/tabid/96/smid/414/ArticleID/169718/reftab/36/t/Citi-Bank-of-Baghdad-announce-tie-up/Default.aspx

With the United States of America at the top of the list as foreign investors it assures us that we will more likely than not prevail in this initial investment. The US has gone so far as to hire a private law firm to assist Iraq with claims against them for debt owed under the old Hussein Regime. The United Kingdom is also vested in the new Iraq. There are many more but I feel these to super powers more than suffice as the indicator needed to make solid decisions. Couple that with the former Presidents involvement and I really don’t need anymore. I am having a difficult time establishing solid proof that Mr. Bush was in Iraq in March 2011. I have however included the link establishing Mr. Bush in Iraq last October. In that article it becomes clear that he is there, taking care of his interests via Halliburton Inc. where former Vice President **** Cheney is still seated as Vice Chairman.

http://articlesofinterest-kelley.blogspot.com/2010/10/george-w-bush-in-kuwait-on-wednesday.html

My evaluation of an investment in foreign currency Revaluation

1. When did the Currency Devalue and what was its value prior to the Devalue?

2. Are there United Nations Security Counsel Sanctions? If so how long have they been in place and when are they up for a review to be lifted?

3. What is the Country’s Gross National Product and are they producing? If no is the answer, what is stopping them? If yes is the answer, are they growing.

4. What is the Country’s Natural Resource situation, dependent on others, co-dependent, or independent?

5. Is the Country trading on the World Market? Are they Members of the World Trade Organization? If not, have they completed an application for Membership?

6. What political system is in use? Parliamentary, Democracy, Dictatorship and so on? Is it solid? If not, where in the particular respected Governments process, is it?

7. Is the Country operating under a budget? If so how long has it been in place? If not when is one anticipated.

8. What’s the Countries Financial Infrastructure look like? Banks in play?

9. What Countries are involved? What significant investors are involved?

10. What is the anticipated return on the investment? Is the projected return consistent with the historical examples found in other Countries

Returns on this investment seem to be indicative of the past Revaluations I have historically researched. I believe that the Iraq Dinar must revalue at its original 3.22 USD to 1 IQD plus regional inflation and cost of living. Here is how I came to this rate. Historically no devalued currency falling into the Iraq scenario has ever revalued less than it’s worth prior to the devaluation. As a matter of fact no currency that I can find has ever, in this scenario, come in at the old rate prior to devalue, but rather it has revalued at a higher rate. Take this information and couple it with some speculative factors to include the following. The Iraqi people had money in the bank when this devalue of their currency occurred. Do we really think that the Iraqi people would accept a loss? I do not. I see them rioting in the streets, a complete chaotic cue. No Iraq must bring the value to the currency back the original rate at the very least. Lastly consider the amounts of oil that Iraq has. They will be bringing this oil to market. This said, the Iraqi currency must have parity with the rest of the Oil producing Nations. There will be global market disruptions and turmoil. To attempt to bring Iraq forward with anything other than consistent competitive pricing just simply will not happen. To do this would be irresponsible and again it just wont happen. Expect a rate consistent with the rest of the top producing oil Countries.

CONCLUSION

The Iraq Dinar is a once in a lifetime opportunity to achieve financial freedom. With this simple but historically factual model, coupled with reasonable speculation, you can easily draw a clear picture of the outcome of this incredible opportunity. In laying the model next to the Kuwaiti Revaluation you will find that if you remove the UN sanctions from this scenario the RV’s time lines are synonymous, This being said get ready for the official announcement very, very soon and understand clearly that the RV we have all been waiting for is not a one day event but rather is a process that began when the UN Sanctions were lifted. That’s right the RV is in progress….. We are waiting for it to finalize. Your investment is already in play.

I want to be the first to congratulate you on your success.

God bless all of you.

“Quietlearner”

Monday, June 20, 2011

With Fathers day passing (Happy Fathers day to all) and my son who graduated from 8th grade at Charles Wright academy, Birthday today turning 14 coupled with the positive news like this coming in the RV Cherry to top it off this is/could be the best June heading into July EVER...GO RV

Danneedsrvnow · June 20, 2011

That's dated 15 December 2010. Is someone forgetting about current chapter VII???????

I feel much better now, thank you.

EXACTLY........I don't why anyone would assume that all of chapter VII has been removed(or at least imply the sanctions are removed), when they are not.

I will say I believe once the sanctions are indeed removed........THEN we will see the rv soon after.

We all can look forward to the meeting June 22nd per Scooters research & hope that chapter VII will be removed.

June 22nd UNSC Meets to discuss Final Report on Iraq to lift Sanctions

CRYPTO REWARDS!

RV is happening now

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