rockfl9

A line item for what ? INCOME from a resource ( oil, gold or iron ore ) is money in the bank . In the ground only future income recognized when sold. As a currency investor it would be the gamble that it will eventually become income and reflect some future profit. What is that risk? Will the country be able to capitalize on that resource ? Will it expand the production ? How long will it take ? Iraq is on the brink. Government is not functioning. Income has fallen to just enough to pay salaries , nothing left to fight Coronavirus.. There have been no regular auctions because at least the MOF knows it needs to stockup on dollars . There must already be food and medicine shortages prices are rising (inflation). If they stop paying their first-responders will they take the risk and continue to serve? We may be looking at a different Iraq next year.

It has no value on the international stage until it is transported. It is the same with gold ore , unmined diamonds ETC. Until a buyer can take possession it has no current value. Iraq could sell future contracts for oil but the best they would get is a retainer fee but they would be obligated to ship the oil at some discounted price. At best it is a band aide. This may be the five year deal they announced with China! Iraq is on the ropes. They have to sell as much oil as they can at any price because they cant store it. They need the dollars because the dinar has no value in the world market. They need food and medical supplies or many will die. They will get limited humanitarian aide but may have to agree to restrictions and oversight. They could RV But I dont know what good it would do. It would messup the internal economy but no one outside of the country is now or will be buying dinar. In the FOREX market it is the law of Demand.not supply. It is not possible to buy anything of consequence with dinar but you can buy anything with USD.

The belief that the IQD is purposly UNDERvalued is FALSE. The CBI has issued more dinar and the reserves have been depleted by at least 20 Bn USD. They also may have sold some gold. We wont know until the CBI issues the annual report for 2019. They are talking about raiding the reserves again to cover COVID19 stimulus. The street price is up to 1280:$. Sort of proves the autoins have been proping it up for a long time. It will be interesting to see the value when they open the auctions . .

Things are getting crazy. Maybe it is a side effect of cabin fever. people areloosing their sense of logic. The gold standard was a failure. Check Wikipedia. Certainly would not be any different today. IQD part of CBI reserves ??? That's not logical . If a central bank could count it's own currency as a reserve it would just issue a big bond put it in the reserve and call it even it would declare any value it wanted. Just a numbers game. There would be no change in real value in the world market. Only BIS and IMF can state what can be used as a reserve currency. The possibility that a RV of the dinar would solve Iraqs problems is impossible . The only thing that would is a massive increase in oil revenues and that is not likely. The idea that a RV of any amount would cause banks to want to buy dinar is Guru pupu. Banks will buy (i.e. broker) dinar ONLY when they have a customer for it .. WHO would that be ??? The only people who want dinar would be those who would have to believe there would be profit to be made that is better and less risky than some other investment .. Many more would want to SELL than buy.

CV is a living organism . It needs a warm moist surface with a flow of oxygen to propagate , like nose throat and lungs. Inhaling steam makes things worse ! DONT INHALE STEAM. Hot dry air will probably kill it but the temperature would need to be greater than 169 deg F for a period of time and your body could not stand that ..

They must plan for CV Tobe as bad as Iran, but we know their health care system is disfunctional. If they don't do Auctions it means they are going to delay paying salaries. They want to delay paying IOCs. As things are oil producers will sell any oil they can at any price ,thus I expect the price will be low for a long time. If they do anything it will be to devalue and print more.

The GOI must save dollars to be sure it will have enough to buy food medicine PPEs and resp irators. They can't use. Dinar for those , themarket demands dollars

Iraq is supported by oil revenues. We all know that. As AM explained the MOF gives the oil money to the CBI to sell for dinar. those dinar are then used to cover the budget which is mainly salaries. But we also know that the last 10 budgets required some form of borrowing . The drsft 2020 budget planed to borrow $40Bn. The GOIs credit is not that good. Today they get 1200 dinar per dollar. At one cent they would get 100 per dollar. THINK they would need to offer 12 times the number of dollars to recieve the numer of dinar to meet the demands of the budget. BUT oil revenues ARE decreasing AND they cant control that.'. Would they dip into the CBI reserves??? That wouldn;t last a week ! Well the Dinarian would say wages and prices would have to be adjusted, but how. Iraqi wages are mandated (fixed )by law. . Setting price limits would require a new law. How long would that take? Even if they could find a way to adjust wages and prices by a factor of 12 they would only be right back to where they are today.. And they would NEED the small denoms or the economy would tank. As for the dinar out of the country the instability created would make it less desirable , no one would gamble a penny for a dinar.

Of course LB. They don't want a non-Iraqi to bring in a suitcase of dinar and leave with dollars . Which poses the question of will they ever want that dinar back??

This rule says that no one is allowed to carry more than 1 million in or out of the country PERIOD. If You read the CBI law it states that the IQD is to be used ONLY in Iraq. It also says that the cbi will convert IQD to another currency ONLY when it chooses to and may limit the amount of conversion. IMO They will have to remove these restrictions BEFORE the FOREX will trade IQD. There would be no legitimate market for the currency. It would be worthless in international commerce.

Iranian doctors say that is underreported. Estimates of 14,000 infected ( per NY Times ). Iraq should be locking down borders . Their health care system is not prepared for this. Should see if they cancel Friday prayers.

Art 3.1 of the CBI Law. says : The objective of the CBI is to achieve and Maintane Price Stability. ?????? HOW would a significant RV occur AND Not cause a major change in prices across the country ? It can't. Prices would swing dramatically.

Guru Sandyf is correct . The IQD will only be worth what the CBI will pay to buy it back in the International market. But the CBI is only paying .00086 to approved Iraqis IN IRAQ. It will not buy it back from any other source AT ANY PRICE. WHY NOT ! because it is afraid of a raid on it's reserves. To change would require the GOI to change fiscal policy. Iraqs dollars are for the benefit of Iraq ONLY. That is their complete mindset. The CBi may find it advantageous in the future to adjust the rate to .001 or even 0.10. But that rate will still only stand IN IRAQ. NO non-Iraqi will benefit.! Remember D J Trump said they are the biggest bunch of thieves he has ever met. THINK why would they pay even $21 to buy back a 25K note when they could just print a new one for 6 cents!

Well they finally corrected the mistake.

I think the oil ministry has been reporting gross sales. The operating companies get $5 per barrel AND get to recover construction costs for new wells. Note that over the last 5 years new well construction has been cut back to save money.

SD. Won't it be snowing at your claim this time of year ? No country covers their currency at anywhere near 100% THESE DAYS . While the IMF expects full transparency from governments it is supporting. it is savvy enough to allow some latitude in reporting. For example Iraq has gold in its reserves but it also sells some of the gold on a regular basis . The amount is variable. P.S> Do you have any idea how dinarans believe that increasing the value of the dinar would make up for the shortfall in oil revenues ? The number of DOLLARS coming in will not change . The change would only DECREASE the number of dinar they get from the sale !

SD.. The Gold Standard is not what most people think ... It was not based on gold backed currency. The Bretton Woods Accord simply set up a value for adjusting trade imbalances with a fixed value for gold. It assumed that all central bankers were honest . It was well known before the Nixon announcement that European central banks were profiting by selling their gold at the higher free market price for dollars that they used to draw on the US reserves. In essence they were stealing from our treasury. .The system we have today allows for trade imbalances to be handled at the current "bulk" market price of gold. That price is set by open market trading at the central bank level. Gold is still used to make trade adjustments . but using SDRs is more efficient.

You cant have economic expansion without some amount of inflation. I don't know if that is a law of economics but it just turns out that way. Our FED looks at inflation/expansion ration as a need to adjust interest rates.. The CBI/MOF quote a low inflation rate for Iraq , Is that the result of tightly controlled growth through the auctions ? Although kept at a modest increase thru the years the MOF has bumped up the amount of dollars available lately.. Is that caused by increased prices or increased volumes ? There is on indisputable fact ---- every year they have more little Iraqis to feed.

The gurus/pumpers want you to believe that there will not be any problems with going to your local bank to "cash-in :' if and when there would be an RV of the dinar . There will be #800 for "appointments " and redemption centers with trained staff to count the money and pay you with cash or check.. This to relieve you of the concern with sending your super-valuable IQD through the US mail. Well it is not going to be that easy. First the RV would be well underway IN IRAQ before you know it happened. Iraqi's get to cash in first. Second there are no prepared redemption centers , US banks don't believe in any need for special treatment. They have standard processes to exchange currency IF there is a DEMAND and NEED to satisfy clients. That is the key point of where the banks are today. WHY would they offer to buy IQD from you IF NOBODY WANTS any ?????? Just because there is an increase in the rate IN IRAQ does note translate to a need in any other country. Take the case of the 1:1 MYTH. Why spend a real 1 million USD to buy 1 million IQD ??? To do what ? Sit on it for years (?) in the HOPE the value would increase and could be sold to another who believes it would further increase!!! Who would take the risk with that much money involved??? They certainly would not just rely on RUMORS. You can take this down to 10 cents or even 1 cent and the logic is the same , no one would be asking a bank to purchase dinar for them. Now could they RV to a whole ,001 cent . YES they could , but the reason would be to cover inflation . We know that the true cost of everything goes up . But the GOI has masked those increases with subsidies and manipulating the exchange rate through the auctions. But they are running out of slack and cant hide it much longer. So the MOF/CBI has 2 choices Print more and larger notes OR bump the rate so that existing notes carry more relative value. Over time they could repeat the increases . Gradually giving more value to the same bulk amount of currency .. BUT ALAS all the time you will be loosing value in dollars invested.

Let us get back to the subject. The CBI cannot create dollars. It can only tender those dollars it has in reserve. How does the CBI do a $0.10 RV ? It will first announce in the auction THAT it is PAYING 10 cents for any IQD offered at the bank in IRAQ only. The result would be a demand for more dollars than it has. It would be bankrupt in a day. Now the MOF could refuse to offer any dollars. The result would be no one would get paid. Anyone who had a dollar surely would not give it up for 10 dinar no matter what the CBI rate was. In fact the dollar would become more valuable if the CBI got out of the market.! The street rate would go up, . That is called INSTABILITY.

EC, I guessed you might be engineer . I am retired EE. John Stossel is entertaining speaker but I think he often distorts the facts just to be entertaining.. Sea level rise and climate change are a fact .. I live in costal Florida and experience the effect at high tide at least 4 times a year. ( street flooding generally, ) During King tides. I prefer to avoid Politics and Religion on DV , now will add Global warming and sea level rise. For decades the doomsayers have predicted one life ending crisis or another , but somehow we have "engineered " a way out.

These graphs come off of a spreadsheet program. It should be obvious that the clerk entered the values in the wrong columns . Should be corrected next entry. The are only human. Nice try!

The ONLY source for dollars into Iraq is thru oil revenue. The GOI restricts the that may be consumed with the amounts tendered in the auctions. Those dollars are converted to dinar currently at 1190:1 primarily to cover internal expenses mostly salaries . Now if the CBI were to increase the rate to something less then the MOF would have to put in more dollars to receive the same amount of dinar or it could not meet the payroll . The last estimate i saw said the current payroll was 60% of oil revenues. So if the cbi were to simply halve the rate to 600:1 (less than 2/10 of a cent ) the GOI would be INSOLVENT within a month. I wonder why people cant see that..

AHA, but for all currencies there ARE TWO (at least) rates . An internal rate set by the central bank AND a second rate determined by the DEMAND in the international market. There could also exist a third rate but it's existence is complicated so I wont try to explain here . The internal rate is set by the central bank to meet the needs of the local government . It could be pegged to some benchmark OR set by FIAT or just plain FLOAT in response to the internal market. It is the rate that sets the price level IN THE LOCAL MARKET. IT can be any rate that sets the granularity for the local currency . In many cases it may not even make sense in reference to other nation's currency (example the British pound sterling ) . THe Internal rate is set as legal tender in the native economy. That is all it is! The International rate is set by the law of supply and demand in competition with all the other currencies ( That is it's FAIR VALUE in real time). What is it's worth against other currencies in what it can buy. People INVEST in a currency with the expectation that it's FUTURE WORTH will increase in the international market NOT what the internal rate sets it to be. So the CBI/MOF could change the rate to anything that suits their purpose but unless there is an actual improvement in value the international rate remains constant. A good example is the USD . In the US the dollar is considered a static value for all transactions. But in the international currency market the value of the dollar varies . Since the dollar is considered a benchmark in the currency market that variation shows up as a change in other currencies ( the value of the dollar falls and the other currency rises.)

Getting back to IQD. WHY is there no one who can answer the question.? What if Iraq DOES somehow try to increase the exchange rate. BUT there is NO ONE willing to buy at that price !! Then there is no way for you to exchange your dinar at that price. Will the dealers offer to buy at anywhere near that price ? GET REAL!! The dealers are in business today because they make a profit by buying LOW and selling HIGH ... AND they have plenty of inventory to get rid of first , if they could. So If there ever is a rate increase just enjoy the paper profit in that shoe box.