Search the Community

Tlar & Members Discuss 1 Dinar To 1 Dollar - 3/7/2015 NCtallguy at March 7, 2015 at 10:01 AM ... Once again, enorrste's take on the amount of currency and a "free float". Now I ask, where has it ever been written and documented that it's going to be a free float? How can they (Kap and Enorrste) claim a gradual rise and a free float at the same time? I have seen the ink on a manged float (as all currencies are under I think) and I've seen the ink on a stationary rate (1.13 or 1.16) being held for 3 years THEN letting the dinar float. But never anything on a "free float". A free float seems like chaois to me. Below is enorrste's latest: I have never...espoused the idea that there would be an RV to $1 and a float thereafter. The RV is simply not possible. If they tried to say, "Our dinar is now worth $1", then, overnight, their money supply would be worth $40 trillion, or about 15 times the money supply of the world. That is why an RV won't work. Put another way, that is why a start rate of $1 per dinar won't work, either. As we have said before, once the exchange rate regime is changed to a freely floating currency, the OFFICIAL rate and the STREET rate become the same thing. The 2% rule is thereby satisfied immediately. 90 days later, in theory, Iraq could move to Article VIII. Tlar: NCtallguy, toward the end of 2012 and the end of Shabibi's governorship of the CBI, Shabibi had decided to just float the currency because he could not get the government to support the plan. ~~~ Tlar Continues: Maliki did not want to release the currency at all so he, being in charge of the government, set his goons out slandering Shabibi and propagandizing that this project should not be done because of the fear of mafia's counterfeiting the currency. The argument was stupid as the project would have stopped counterfeiting but that is not the point. A very frustrated Shabibi finally decided he would never get the governments support nd toward the end of 2012 he stated he would do this "whether the government was on board or not" and that he would "release the currency at 1166 and let the market decide its true value". Thus the float theory was born. Articles on deleting the zeros immediately dried up and were replaced with articles that stated the currency would float from 1166. During this period, Steve and Kaperoni were invited by Ali (DinarTrade) to visit a new facility he was building but not yet opened. They toured the facility as Ali explained to them he had recently met with Shabibi at a banking convention in England and that Shabibi had signed a contract with DinarTrade to be the facilitator of the dinar in the US for the CBI. His job as a facilitator was to do his best to drive the currency up in value. So Kap and Steve felt they had inside knowledge of what was to happen and it was supported in float articles coming out of Iraq at the time, and indeed they did. I too believed Shabibi when he said he would just float the currency starting at 1166 so at that time you could have called me a floatie too. So what changed? Shortly after Steve and Kap had made that trip the confusion started, at least for me. Shabibi, while attending another banking conference in Japan heard rumors that Maliki had placed corruption charges on him. At first he did not believe them, but as we all know those charges tuned out to be true. Shabibi was removed from the CBI by Maliki and Turki took control of the CBI having been appointed by Maliki. Within a month of Turki taking control of the CBI articles about deleting the zeros started to reappear. This was in the first part of 2013. Turki turned out not to be a Maliki minion. This might have been attributed to the IMF, WB, US Treasury showing up immediately upon Turki taking control, and camping out at the CBI until they were satisfied that Turki understood who the bad guy was, Maliki. We can assume this because Turki within a month told parliament he only answers to them and he told Maliki the government would never get their hands on the reserves. Maliki attempted to remove Turki even going so far as to try to bring charges against him. There existed a contemptuous relationship between Maliki and Turki almost from the get go and it lasted throughout Turki's tenure. The point is IMO the program that started out in 2007 known as "delete the zeros" was terminated on or around Sept/Oct of 2012 by Shabibi. He changed it to "just bring the currency out at 1166" (FLOAT), and then program was changed back again under Turki to the originaql plan of "deleting the zeros" which is where I believe we are today. Some folks got stuck in the middle where Shabibi was going to just float the currency, but most followed the articles and moved on with the change back to deleting the zeros. This is an opinion piece only even though I am absolutely sure I'm right and feel all others who have a difference in the way they see it are dead wrong. lol lolo lol The last sentence is a joke NWA - lighten up will you? tlar NCtallguy Thanks Tlar, very well said. My next question.......was Shabbi's plan a "free float" or a managed float. Still seems to me that a free float would be hard if not impossible to control. Isn't it true that there is a "rule" of 2% every 90 days? last question.....just how long would it take to get to say a dollar if 1166 floated 2 % every 90 days? Thanks Tlar NCtallguy, I have no idea. The plan never got that far because Maliki immediately went after Shabibi in order to stop the plan to float. tlar NCTallguy My quick calculations show 1166 floating 2% up every 90 days would take 6 months give or take to get to the rate of 1000. Thats if it floated UP every 90 days. Plenty of unforseen variables that could make it float DOWN during the process. Like I've said, I have never read anything other than "guru" hearsay regarding a free float, which a free float seems very chaotic to me and hard to control. What if the dinar went into a downward free float? I very much doubt Iraq just starting out would want that to happen. NCtallguy 4 trillion dinars at the value of a dollar is still.....4 trillion dinars, he's claimimg theres 40 trillion dinars in circulation but with a very low value (Which is true 1166 to 1) and once the 40 trillion low valued dinars are increased to the value of $1 then there will be $40 trillion dollars worth of dinars circulating. Brian YES but then if they decide to drop the zeros then there would be 4 billion dinars in circulation with a value of 4 billion if it rv's at $1.... Is that correct logic? D42 NC, the word "circulation" can be misleading. What banks hold as foriegn currency reserves falls in this category I believe. That number alone is massive (worldwide) and I wish the exact counts per country were public info. so we could get a better handle for our calculations. Brian brings up a good point as well, reduction of the money supply is achieved and serves to add to the proof that a 1-1 start is fesable. Mike Brian, if they remove the zero's before they raise the rate, then four trillion dinars would be 4 billion dinars. That's not good for us, we want them to raise the rate and slowly remove the 000 notes because of how hard they would be to use in day to day transactions. Can you imagine going to the falafel stand to buy two falafels and you hand them a 25K note worth roughly 25 grand? It would be very difficult to make change and have the economy function normally. Most of us call it a "lop" or a "revenue neutral event" which we're betting against because if they were going to do that, they most likely would have done it already. Clearly, we want Iraq to raise the value on whatever dinar is remaining and then slowly remove the large, 000 notes until there's nothing left but lower denominations. If the note count and circulation numbers are indeed 4 trillion dinars, then Kap and Enoresste are most likely right in their assessment. The US has roughly 1.4 trillion dollars in circulation and there's no way that Iraq, with $100 billion in annual revenue could support a 1-1 exhcange with 4 trillion dinars in circulation, they just don't have the wealth or the economy to create such a valuable currency with that much out there. The key to this is how much is really out there, it's one of the most important pieces of information and we have had no access to that since 2012. I'm confident, based on numerous news reports about the scarcity and condition of the dinar that there's less than a trillion iin circulation, probably much less but that's my conservative estimate. That being said, there are reports from the Ministry of Planning and the SIGIR that both state the dinar would come out at either .89 or 1.16, that's my best guestimate to what the original starting rate of the dinar would be, based on what they've told us in the past. All of this is academic anyway, we need Iraq to grow up, put on their big boy pants and move to Article VIII. If Vietnam can do it, Iraq should be able to do it. They just need the political willpower to step up the the plate and improve the lives of their citizens, something we've been woefully short of until Abadi became PM. Here's hoping they make a move sooner rather than later. Tlar Mike excellent points. Something that I have said in the past that is controversial and that some will disagree with, is that when they push the RV button all dinar sitting in electronic accounts on both sides of the ledger, will lose three zeros and will be adjusted commensurate with the new rate. What I mean by this is that electronic dinars will be adjusted downward to the new rate just as everything in Iraq will be. Just like it will be done in the stock market. Here's my thinking. Let's say an Iraqi who is starting a business makes a loan the night before the RV of say 50,000 dinar and then sets up a checking account from which to operate his business out of, but has yet to write his first check. If the RV takes place that night, both sides of the accounting ledger sheet must be adjusted otherwise the Iraqi just hit the lottery. In other words we understand that the loan side will be adjusted down to 50 dinars due to the law of indebtedness. My contention is this, the checking account will also have to be adjusted as will all electronic accounts be it in banking or the stock market or individuals loaning money to individuals. Only the physical dinars held by anybody will be able to prosper from this event as a dinar will still be a dinar. So even if 80% of the 37 trillion is sitting in accounts at the government banks, and the more trillions sitting in private accounts held by citizens, all will be adjusted to the new rate but they will not loose value. An Iraqi who has 100,000 dinars sitting in an account before this event, will have 100 dinar sitting in the account after the event. This is just an example only and the rate itself will dictate the actual amount of change, but every account in Iraq will have to be adjusted as will the cost of everything including hard assets and property values to the new exchange rate. This is my opinion but I don't see how else this can work any other way. An electronic dinar must be treated differently than a paper dinar. There will be no loss in value of anything electronic. If you think through this I believe you will agree with me. I am completely opened minded about this but anyone who sees it differently than me is dead wrong. lololoololol NWA - lighten up. Don't get your panties in a wad. It's an opinion piece and the last sentence is a joke. tlar