CaptnJerry (Re-denomination… A very real possibility and it’s nothing to be afraid of!): OOM 1/26/12 JANUARY 26TH, 2012

[Papster]

CaptnJerry (Re-denomination… A very real possibility and it’s nothing to be afraid of!): OOM 1/26/12

JANUARY 26TH, 2012

I am starting this thread to educate all the dinar holders here on the possibility of the re-denomination of the Iraqi currency and that it’s nothing to fear. But wait before you get all upset, try to forget all of the doom and gloom that has been presented by “those who shall remain nameless” when describing this process and look at some facts.

If you follow the new articles/press releases (not the opinion pieces) Iraq has always described a redenomination/lop. “Those who shall remain namless” are the only ones saying that it won’t Redenominate/LOP. Iraq has stated that the income of the people would not change, but the currency would have more buying power. Iraq has stated with the razing of the 000′s that 200,000 old dinar will equal 200 new dinar, 100,000 OD will equal 100 ND, 250 OD = .25 ND, 50 OD = .05 ND… According to the examples Iraq has given, the razing of the 000′s will effect the currency and by default the exchange rate (.00085 – $1 becomes .85 – $1). If it continues to go the way Iraq has always said it will go, we are at best looking at a possible breaking even with a 1-1 exchange rate, depending on when you bought your dinar (what rate you paid for your dinar). The new dinar or lower demons, are supposed to be replacing the old denoms. The two will coexist in circulation for 2-4 years, but possessors will have up to 10 years to exchange before being retired and becoming worthless.

Why would Iraq re-denominate their currency?

In times of inflation, the same number of monetary units have continually decreasing purchasing power. In other words, prices of products and services must be expressed in higher numbers. If these numbers become excessively large, they can impede daily transactions because of the risk and inconvenience of carrying stacks of bills, or the strain on systems, e.g. automatic teller machines (ATMs), or because human psychology does not handle large numbers well. The authorities may alleviate this problem by redenomination: a new unit replaces the old unit with a fixed number of old units being converted to 1 new unit. If inflation is the reason for redenomination, this ratio is much larger than 1, usually a positive integral power of 10 like 100, 1000 or 1 million, and the procedure can be referred to as “cutting zeroes”.

Here are 2 examples

1. Brazil,

On February 3, 2010, the Central Bank of Brazil announced a new series of the real banknotes which would begin to be released in April 2010. The new design will add security enhancements which aim to reduce counterfeiting. The notes will have different sizes according to their values to help vision-impaired people. The changes were made reflecting the growth of the Brazilian economy and the need for a stronger and safer currency. The new banknotes have begun to enter circulation in December 2010, coexisting with the older ones.

2. Romania,

If we read the history of the process of the removal of the zeros in Romania we can see where they did the same thing, where there was not a time limit to exchange the old for the new leu. Please see the below link for an article from July 1, 2005 when they implemented the Romania process to remove 4 zeros from their currency. This was a 10,000:1 redenomination, as opposed to the 1000:1 that the CBI has been stating they want to do.

http://www.rferl.org/content/article/1059616.html

Please note in there the same verbage we read today similar to the process of deleting 3 zeros from the Dinar.

Now, here is the key thing to note though, please see the link below, and on page 1 they talk about how the prices would work for the 2 different notes that will be in circulation and could be used from July 2005 through June 2006. here is the verbage and the link: “Implementation of the new currency shall be made according to the following schedule: – July 1, 2005: introduction of the new leu (RON). All account balances, credit and debit, shall be converted to RON and all banking transfers, accounting documents and supporting payment instruments, starting on this date, shall be performed and drawn up only in RON; – July 1, 2005 – June 30, 2006: double posting of prices, both in old and new leu, including forex exchange rates. The exchange rates shall be expressed with four decimals, without any rounding; December 31, 2006: Until this date both the old and new leu shall be accepted for cash payments. There is no time limit for exchanging ROL notes and coins for RON notes and coins at the National Bank of Romania branches performing cash operations and at the credit institutions authorised to perform such operations by order of the National Bank of Romania Governor (para 4, article 2 of Law no. 348/2004 as amended).

https://www.isdadocs.org/speeches/memopdf/Redenomination-Memo-061405.pdf

So I hope this helps explain the meaning behind what it means when they say the notes will co-exist.

One more thing I thought I would add is this. in the explanation above it stated: “- July 1, 2005 – June 30, 2006: double posting of prices,”

I thought that I would provide an example of a price tag that showed the 2 different prices to reflect the rates for both the old and new notes: http://en.wikipedia.org/wiki/File:Romania_revalue_tag.jpg

Here is a recent article describing the steps to be taken which is just one of many…

Parliamentary Finance: Delete the zeros from the currency needs to be two and three stages بغداد-وارع – قال عضو اللجنة المالية النائب هيثم الجبوري ان عملية حذف الاصفار من العملة يحتاج الى سنتين وبثلاث مراحل. Baghdad – and babysit – A member of the Finance Committee MP Haitham Jubouri that the process of removing zeros from the currency needs to be two and three stages.

وأوضح في تصريح صحفي :” ان مراحل حذف الاصفار من العملة ، تُقسم الى ثلاث مراحل ، تستغرق المرحلة الاولى ستة اشهر لتوفير الاجهزة الطباعية ، فيما تكون المرحلة الثانية لادخال العملتين في ان واحد ، و ستكون الستة اشهر الاخيرة لسحب العملة القديمة وبقاء العملة الجديدة”. He explained in a press statement: “The stages of the deletion of zeros from the currency, divided into three phases, first phase, lasting six months to provide services printing, while the second phase of the introduction of two currencies at the same time, and will last six months to pull the old currency and the survival of the new currency.”

وأضاف :” ان دور اللجنة المالية في مجلس النواب رئيسي وهي المضطلع الوحيد والتفصيلي حول الية حذف الاصفار ، مبيناً ان اللجنة اجتمعت بمحافظ البنك المركزي وتم دراسة موضوع حذف الاصفار بجانبيه السلبي والايجابي”. He added: “The role of the Finance Committee in the House of Representatives is mainly carried out only on the detailed mechanism and delete the zeros, indicating that the Committee met with the Governor of the Central Bank has been the study of deletion of zeros Bjanabih negative and positive.”

واشار الى :” ان الشرح المفصل من قبل البنك المركزي ، بدد التخوف من التضخم والغسيل المالي والتزوير ، مؤكداً ” وجود اجهزة ولجان قادرة على السيطرة على هذه المشاكل ان حدثت”. He said: “The detailed explanation by the Central Bank, dispelled the fear of inflation, washing and financial fraud, asserting that” the existence of agencies and committees are able to control these problems that occurred. “

http://translate.google.com/translate?hl=en&sl=auto&tl=en&u=http%3A%2F%2Falrayy.com%2F40817.htm

And another…

And the central bank of Iraq’s intention to launch a large three categories after deleting three zeros from the Iraqi dinar, pointing out that the process of replacing the currency will take two years. وقال نائب محافظ البنك المركزي مظهر محمد صالح لـ”السومرية نيوز” : إن البنك سيطرح ثلاث فئات كبيرة إضافة إلى الفئات المعدنية، بعد أن يقوم بحذف ثلاثة أصفار من الدينار العراقي مبيناً أن عملية التبديل من شأنها إصلاح نظام إدارة العملة وتسهيل استخدامها . The deputy governor of the Central Bank of the appearance of Mohammed Saleh “Alsumaria News”: The Bank will present three categories in addition to large groups of mineral, after the deletion of three zeros from the Iraqi dinar, indicating that the switch would reform the system of currency management and ease of use. وأضاف صالح أن الفئات الثلاث تشمل 200 دينار التي تساوي 200 ألف دينار في الوقت الحاضر وفئة 100 دينار التي تساوي 100 ألف دينار وفئة 50 ديناراً التي تساوي 50 ألف دينار، إضافة إلى العملة المعدنية من فئة الدينار والدينارين فضلاً عن النصف والربع دينار و100 فلس والدرهم”. Saleh added that the three categories consist of 200 dinars, which is equal to 200 thousand dinars at the present time and a 100 dinars, which is equal to 100 thousand dinars, and the category of 50 dinars, which is equal to 50 thousand dinars, in addition to the coin of the category of the dinar and Dinarin as well as half and quarter dinars and 100 fils and dirham ” . ولفت صالح إلى أن “حذف ثلاثة أصفار من الدينار العراقي من شأنه اختصار عدد الأوراق النقدية من أربعة مليارات ورقة والتي تساوي 30 ترليون دينار موجودة في الأسواق العراقية إلى مليار و800 مليون ورقة فقط”، مؤكداً أن “تبديل العملة سوف لا يؤثر على دخل الفرد أو على ثرواته أو التزاماته التعاقدية”. Saleh indicated that “the deletion of three zeros from the Iraqi dinar would shorten the number of banknotes of four billion and paper, which is equal to 30 trillion dinars exist in the Iraqi market to one billion and 800 million paper only,” asserting that “the currency exchange will not affect the per capita income or over its wealth or its contractual obligations. ” وأشار صالح الى أن “مجلس إدارة البنك قد صادق على قرار حذف الأصفار بعد أن تم الانتهاء من تصاميم العملة التي تحمل الإرث العراقي وتاريخه وحضاراته، فضلاً عن مناقشته من قبل اللجنة المالية والاقتصادية في مجلس الوزراء”، مبينا أن “البنك بانتظار موافقة المجلس للبدء باستبدال العملة الجديدة والتي يجب أن تكون مع سنة مالية جديدة والتي اقترحها البنك مع بداية العام 2013″. Saleh pointed out that “the Board of Directors has approved the decision to delete the zeros after the completion of designs currency bearing the legacy of Iraq and its history and civilizations, as well as for discussion by the Financial and Economic Committee of the Council of Ministers,” noting that “the Bank pending the Board’s approval to begin the replacement of the new currency and which must be with the new financial year and proposed by the Bank with the beginning of the year 2013. ” وأكد صالح أن “عملية استبدال العملة ستستغرق عامين كاملين لمنع حدوث أي خلل في عملية التسليم والاستلام”، موضحاً أن “المصارف ستستمر باستلام العملة القديمة لمدة عشر سنوات كحقوق وليس للتداول”. Salih stressed that “the process of replacing the currency will take two years to prevent any disruption in the process of delivery and receipt,” explaining that “the banks will continue to receive the old currency for ten years as rights and not negotiable.”

Why won’t Iraq just RV before the release of the replacement currency or lower denoms?

Iraq has roughly 25 Trillion dinar in circulation and because of this the Iraqi dinar is only worth about 1/10th of a cent each. Kuwait has roughly 25 Billion dinar in circulation resulting in a dinar that is worth $3.69 USD each. That means Iraq has 24.925 Trillion more dinar in circulation than Kuwait! That’s why Iraq’s currency is valued as low as it is… Kuwait does have a higher per capita income than Iraq, but the per capita income in Iraq will rise as soon as they pass the HCL/Erbil (Oil and Gas Revenue Sharing)… To me it comes down to common sense… Ask yourself this… Why would Iraq spend Trillions of dollars to RV 25 Trillion dinar at 1-1 when they can cut the money supply down to 25 Billion by razing the 000′s as they state they will do and then RV at 1-1 saving themselves 24.75 Trillion dollars?

When will it happen?

Iraq has been stating 2013. I personally feel we will see all of this happen once the the exchange rate drops down to 1000 IQD – 1 USD. I feel that will be the trigger to release the lower denoms at the 1 IQD – 1 USD rate… Hence the razing of the 000′s… 1 OD (old dinar) = .001 USD and 1 ND (new dinar) = 1 USD which will fall in line with what Iraq has been saying 200K OD = 200 ND… It will initially be a 1-1 exchange of ND to USD to de-dollarize or pull the USD out of circulation and slowly appreciate up to be somewhere around the Kuwaiti dinar ($3.69 right now I think). Which that should pretty much triple or quadruple the return on your investment, it just won’t be the windfall millions that “Those who shall remain namless” are pumping. The only negative thing or I should say downside is that it won’t happen overnight, it will be a while, possibly a few more years before it gets there. It may take 2 or more years to get there, but I feel it will! Remember that this is a long term investment and keep the faith… JMHO Go read AJ’s explaination of the process maybe it will make a little more sense to you…

http://www.****************/t17193-ajs-intel-01-23-12#111953

“The draft law submitted to the Council of Ministers stressed that the central bank holds in its several steps, including changing the structure of the Iraqi currency…..”

The above quote from the last article Miske posted sure goes right along with the current value of the dinar. Shabibi has always said it was going to be a slow process, contrary to others beliefs.

“Central bank holds in its several steps” is the key. The dinar is revaluing slowly, which is step one. Once the dinar gets to the proper value, then Shabibi will introduce the lower denominations into Iraq, which is step two. Step three will be removal of the USD from the market place, but that will not be achieved until the dinar is at par value with the USD.

This process very well could take 2 years to complete, but it could also happen overnight, no one will know, but when it happens it will happen all at once. What I mean by this is if Shabibi decides the time is right, he could RV at the 1 to 1 par rate with the USD, release the lower denominations to buy the USD out of the market of Iraq all at once.

Hope this helps and take all intel with a grain of salt, including mine, as all are speculating and trying to second guess the process.

Thank you Miskebam for the article.

God Bless,

AJ

Everyone please remember that this is only my opinion on the facts that have been provided to us by Iraq.

To answer your question of why am I still in this? I’m in this to make money like everyone else! I just choose to be a realist regarding this investment instead of being a dreamer.

[gamblinkid]

Thanks for a possible result; it will take time, I'm sure.

[jlassociates]

Makes sense but he will be banned shortly for explaining something so well thought out over there. Yep the wizard wont like that

[bamagirl]

I don't care for this scenerio...I prefer to dream til I have to wake up, lol! Thanks for post Papster!

[matthew6:19-21]

Captnjerry can go ahead and march right down to the bank and give them his 25,000 IQD notes for 25 USD. Better take a sharpie with you because I can't seem to rub those zeros off of my bills. We all bought notes from them with a certain value on them ie: 25,000, 10,000, etc, and they have to buy them back from us and shabbibi knows that. There will not be two different exchange rates. You want to talk about confusing people. Besides that there is not 25 trillion dinar in circulation, read what the cbi articles about the money they are pulling in and putting out. They are in complete control of their money.

[despain]

This scenario makes complete sense. There is just one problem with it. They are pulling in the larger notes, and have been for quite some time. If they were not doing that, then I think this would be EXACTLY what we would be looking at. Why would you be pulling in the Dinar, and releasing the dollars, if you were just going to lop the currency? Perhaps someone can explain that to me? JMHO... I know...here we go again.

[bamagirl]

This scenario makes complete sense. There is just one problem with it. They are pulling in the larger notes, and have been for quite some time. If they were not doing that, then I think this would be EXACTLY what we would be looking at. Why would you be pulling in the Dinar, and releasing the dollars, if you were just going to lop the currency? Perhaps someone can explain that to me? JMHO... I know...here we go again.

+100

[keepmwlknfny]

Besides that there is not 25 trillion dinar in circulation, read what the cbi articles about the money they are pulling in and putting out.

You sure about that?? Can you provide some documentation on your statement?

[Drprunepicker]

CaptnJerry (Re-denomination… A very real possibility and it’s nothing to be afraid of!): OOM 1/26/12

JANUARY 26TH, 2012

I am starting this thread to educate all the dinar holders here on the possibility of the re-denomination of the Iraqi currency and that it’s nothing to fear. But wait before you get all upset, try to forget all of the doom and gloom that has been presented by “those who shall remain nameless” when describing this process and look at some facts.

If you follow the new articles/press releases (not the opinion pieces) Iraq has always described a redenomination/lop. “Those who shall remain namless” are the only ones saying that it won’t Redenominate/LOP. Iraq has stated that the income of the people would not change, but the currency would have more buying power. Iraq has stated with the razing of the 000′s that 200,000 old dinar will equal 200 new dinar, 100,000 OD will equal 100 ND, 250 OD = .25 ND, 50 OD = .05 ND… According to the examples Iraq has given, the razing of the 000′s will effect the currency and by default the exchange rate (.00085 – $1 becomes .85 – $1). If it continues to go the way Iraq has always said it will go, we are at best looking at a possible breaking even with a 1-1 exchange rate, depending on when you bought your dinar (what rate you paid for your dinar). The new dinar or lower demons, are supposed to be replacing the old denoms. The two will coexist in circulation for 2-4 years, but possessors will have up to 10 years to exchange before being retired and becoming worthless.

Why would Iraq re-denominate their currency?

In times of inflation, the same number of monetary units have continually decreasing purchasing power. In other words, prices of products and services must be expressed in higher numbers. If these numbers become excessively large, they can impede daily transactions because of the risk and inconvenience of carrying stacks of bills, or the strain on systems, e.g. automatic teller machines (ATMs), or because human psychology does not handle large numbers well. The authorities may alleviate this problem by redenomination: a new unit replaces the old unit with a fixed number of old units being converted to 1 new unit. If inflation is the reason for redenomination, this ratio is much larger than 1, usually a positive integral power of 10 like 100, 1000 or 1 million, and the procedure can be referred to as “cutting zeroes”.

Here are 2 examples

1. Brazil,

On February 3, 2010, the Central Bank of Brazil announced a new series of the real banknotes which would begin to be released in April 2010. The new design will add security enhancements which aim to reduce counterfeiting. The notes will have different sizes according to their values to help vision-impaired people. The changes were made reflecting the growth of the Brazilian economy and the need for a stronger and safer currency. The new banknotes have begun to enter circulation in December 2010, coexisting with the older ones.

2. Romania,

If we read the history of the process of the removal of the zeros in Romania we can see where they did the same thing, where there was not a time limit to exchange the old for the new leu. Please see the below link for an article from July 1, 2005 when they implemented the Romania process to remove 4 zeros from their currency. This was a 10,000:1 redenomination, as opposed to the 1000:1 that the CBI has been stating they want to do.

http://www.rferl.org/content/article/1059616.html

Please note in there the same verbage we read today similar to the process of deleting 3 zeros from the Dinar.

Now, here is the key thing to note though, please see the link below, and on page 1 they talk about how the prices would work for the 2 different notes that will be in circulation and could be used from July 2005 through June 2006. here is the verbage and the link: “Implementation of the new currency shall be made according to the following schedule: – July 1, 2005: introduction of the new leu (RON). All account balances, credit and debit, shall be converted to RON and all banking transfers, accounting documents and supporting payment instruments, starting on this date, shall be performed and drawn up only in RON; – July 1, 2005 – June 30, 2006: double posting of prices, both in old and new leu, including forex exchange rates. The exchange rates shall be expressed with four decimals, without any rounding; December 31, 2006: Until this date both the old and new leu shall be accepted for cash payments. There is no time limit for exchanging ROL notes and coins for RON notes and coins at the National Bank of Romania branches performing cash operations and at the credit institutions authorised to perform such operations by order of the National Bank of Romania Governor (para 4, article 2 of Law no. 348/2004 as amended).

https://www.isdadocs.org/speeches/memopdf/Redenomination-Memo-061405.pdf

So I hope this helps explain the meaning behind what it means when they say the notes will co-exist.

One more thing I thought I would add is this. in the explanation above it stated: “- July 1, 2005 – June 30, 2006: double posting of prices,”

I thought that I would provide an example of a price tag that showed the 2 different prices to reflect the rates for both the old and new notes: http://en.wikipedia.org/wiki/File:Romania_revalue_tag.jpg

Here is a recent article describing the steps to be taken which is just one of many…

Parliamentary Finance: Delete the zeros from the currency needs to be two and three stages بغداد-وارع – قال عضو اللجنة المالية النائب هيثم الجبوري ان عملية حذف الاصفار من العملة يحتاج الى سنتين وبثلاث مراحل. Baghdad – and babysit – A member of the Finance Committee MP Haitham Jubouri that the process of removing zeros from the currency needs to be two and three stages.

وأوضح في تصريح صحفي :” ان مراحل حذف الاصفار من العملة ، تُقسم الى ثلاث مراحل ، تستغرق المرحلة الاولى ستة اشهر لتوفير الاجهزة الطباعية ، فيما تكون المرحلة الثانية لادخال العملتين في ان واحد ، و ستكون الستة اشهر الاخيرة لسحب العملة القديمة وبقاء العملة الجديدة”. He explained in a press statement: “The stages of the deletion of zeros from the currency, divided into three phases, first phase, lasting six months to provide services printing, while the second phase of the introduction of two currencies at the same time, and will last six months to pull the old currency and the survival of the new currency.”

وأضاف :” ان دور اللجنة المالية في مجلس النواب رئيسي وهي المضطلع الوحيد والتفصيلي حول الية حذف الاصفار ، مبيناً ان اللجنة اجتمعت بمحافظ البنك المركزي وتم دراسة موضوع حذف الاصفار بجانبيه السلبي والايجابي”. He added: “The role of the Finance Committee in the House of Representatives is mainly carried out only on the detailed mechanism and delete the zeros, indicating that the Committee met with the Governor of the Central Bank has been the study of deletion of zeros Bjanabih negative and positive.”

واشار الى :” ان الشرح المفصل من قبل البنك المركزي ، بدد التخوف من التضخم والغسيل المالي والتزوير ، مؤكداً ” وجود اجهزة ولجان قادرة على السيطرة على هذه المشاكل ان حدثت”. He said: “The detailed explanation by the Central Bank, dispelled the fear of inflation, washing and financial fraud, asserting that” the existence of agencies and committees are able to control these problems that occurred. “

http://translate.google.com/translate?hl=en&sl=auto&tl=en&u=http%3A%2F%2Falrayy.com%2F40817.htm

And another…

And the central bank of Iraq’s intention to launch a large three categories after deleting three zeros from the Iraqi dinar, pointing out that the process of replacing the currency will take two years. وقال نائب محافظ البنك المركزي مظهر محمد صالح لـ”السومرية نيوز” : إن البنك سيطرح ثلاث فئات كبيرة إضافة إلى الفئات المعدنية، بعد أن يقوم بحذف ثلاثة أصفار من الدينار العراقي مبيناً أن عملية التبديل من شأنها إصلاح نظام إدارة العملة وتسهيل استخدامها . The deputy governor of the Central Bank of the appearance of Mohammed Saleh “Alsumaria News”: The Bank will present three categories in addition to large groups of mineral, after the deletion of three zeros from the Iraqi dinar, indicating that the switch would reform the system of currency management and ease of use. وأضاف صالح أن الفئات الثلاث تشمل 200 دينار التي تساوي 200 ألف دينار في الوقت الحاضر وفئة 100 دينار التي تساوي 100 ألف دينار وفئة 50 ديناراً التي تساوي 50 ألف دينار، إضافة إلى العملة المعدنية من فئة الدينار والدينارين فضلاً عن النصف والربع دينار و100 فلس والدرهم”. Saleh added that the three categories consist of 200 dinars, which is equal to 200 thousand dinars at the present time and a 100 dinars, which is equal to 100 thousand dinars, and the category of 50 dinars, which is equal to 50 thousand dinars, in addition to the coin of the category of the dinar and Dinarin as well as half and quarter dinars and 100 fils and dirham ” . ولفت صالح إلى أن “حذف ثلاثة أصفار من الدينار العراقي من شأنه اختصار عدد الأوراق النقدية من أربعة مليارات ورقة والتي تساوي 30 ترليون دينار موجودة في الأسواق العراقية إلى مليار و800 مليون ورقة فقط”، مؤكداً أن “تبديل العملة سوف لا يؤثر على دخل الفرد أو على ثرواته أو التزاماته التعاقدية”. Saleh indicated that “the deletion of three zeros from the Iraqi dinar would shorten the number of banknotes of four billion and paper, which is equal to 30 trillion dinars exist in the Iraqi market to one billion and 800 million paper only,” asserting that “the currency exchange will not affect the per capita income or over its wealth or its contractual obligations. ” وأشار صالح الى أن “مجلس إدارة البنك قد صادق على قرار حذف الأصفار بعد أن تم الانتهاء من تصاميم العملة التي تحمل الإرث العراقي وتاريخه وحضاراته، فضلاً عن مناقشته من قبل اللجنة المالية والاقتصادية في مجلس الوزراء”، مبينا أن “البنك بانتظار موافقة المجلس للبدء باستبدال العملة الجديدة والتي يجب أن تكون مع سنة مالية جديدة والتي اقترحها البنك مع بداية العام 2013″. Saleh pointed out that “the Board of Directors has approved the decision to delete the zeros after the completion of designs currency bearing the legacy of Iraq and its history and civilizations, as well as for discussion by the Financial and Economic Committee of the Council of Ministers,” noting that “the Bank pending the Board’s approval to begin the replacement of the new currency and which must be with the new financial year and proposed by the Bank with the beginning of the year 2013. ” وأكد صالح أن “عملية استبدال العملة ستستغرق عامين كاملين لمنع حدوث أي خلل في عملية التسليم والاستلام”، موضحاً أن “المصارف ستستمر باستلام العملة القديمة لمدة عشر سنوات كحقوق وليس للتداول”. Salih stressed that “the process of replacing the currency will take two years to prevent any disruption in the process of delivery and receipt,” explaining that “the banks will continue to receive the old currency for ten years as rights and not negotiable.”

Why won’t Iraq just RV before the release of the replacement currency or lower denoms?

Iraq has roughly 25 Trillion dinar in circulation and because of this the Iraqi dinar is only worth about 1/10th of a cent each. Kuwait has roughly 25 Billion dinar in circulation resulting in a dinar that is worth $3.69 USD each. That means Iraq has 24.925 Trillion more dinar in circulation than Kuwait! That’s why Iraq’s currency is valued as low as it is… Kuwait does have a higher per capita income than Iraq, but the per capita income in Iraq will rise as soon as they pass the HCL/Erbil (Oil and Gas Revenue Sharing)… To me it comes down to common sense… Ask yourself this… Why would Iraq spend Trillions of dollars to RV 25 Trillion dinar at 1-1 when they can cut the money supply down to 25 Billion by razing the 000′s as they state they will do and then RV at 1-1 saving themselves 24.75 Trillion dollars?

When will it happen?

Iraq has been stating 2013. I personally feel we will see all of this happen once the the exchange rate drops down to 1000 IQD – 1 USD. I feel that will be the trigger to release the lower denoms at the 1 IQD – 1 USD rate… Hence the razing of the 000′s… 1 OD (old dinar) = .001 USD and 1 ND (new dinar) = 1 USD which will fall in line with what Iraq has been saying 200K OD = 200 ND… It will initially be a 1-1 exchange of ND to USD to de-dollarize or pull the USD out of circulation and slowly appreciate up to be somewhere around the Kuwaiti dinar ($3.69 right now I think). Which that should pretty much triple or quadruple the return on your investment, it just won’t be the windfall millions that “Those who shall remain namless” are pumping. The only negative thing or I should say downside is that it won’t happen overnight, it will be a while, possibly a few more years before it gets there. It may take 2 or more years to get there, but I feel it will! Remember that this is a long term investment and keep the faith… JMHO Go read AJ’s explaination of the process maybe it will make a little more sense to you…

http://www.****************/t17193-ajs-intel-01-23-12#111953

“The draft law submitted to the Council of Ministers stressed that the central bank holds in its several steps, including changing the structure of the Iraqi currency…..”

The above quote from the last article Miske posted sure goes right along with the current value of the dinar. Shabibi has always said it was going to be a slow process, contrary to others beliefs.

“Central bank holds in its several steps” is the key. The dinar is revaluing slowly, which is step one. Once the dinar gets to the proper value, then Shabibi will introduce the lower denominations into Iraq, which is step two. Step three will be removal of the USD from the market place, but that will not be achieved until the dinar is at par value with the USD.

This process very well could take 2 years to complete, but it could also happen overnight, no one will know, but when it happens it will happen all at once. What I mean by this is if Shabibi decides the time is right, he could RV at the 1 to 1 par rate with the USD, release the lower denominations to buy the USD out of the market of Iraq all at once.

Hope this helps and take all intel with a grain of salt, including mine, as all are speculating and trying to second guess the process.

Thank you Miskebam for the article.

God Bless,

AJ

Everyone please remember that this is only my opinion on the facts that have been provided to us by Iraq.

To answer your question of why am I still in this? I’m in this to make money like everyone else! I just choose to be a realist regarding this investment instead of being a dreamer.

Nice article, great explanation of what will logically and ecconomically occur, however, this type information can not penetrate the tinfoil hats most on this site wear.

[Darin]

In some cases, re-denominations can be done at 1:1 (See Kuwait)

They've referenced them as a R/D on numerous occassions

Some will argue this, but I still believe, that a re-denomination can simplymean the issuing of new currency with new denominations.

Something that would happen upon a R/V or a LOP

Kuwait did it because they wanted to issue a new currency because old plates were stolen.

1:1 exchange old for new and maintained its value.

Doesn't necessarily have to be about raising zeros, deleting zeros, etc.

But, upon the R/V, the 3 zeros will essentially be removed as well, as you see they will have no use for 1,000 note, because even in the U.S. a $1,000 note would be rare.

[Rudolph_the_Red]

CaptnJerry (Re-denomination… A very real possibility and it’s nothing to be afraid of!): OOM 1/26/12

JANUARY 26TH, 2012

I am starting this thread to educate all the dinar holders here on the possibility of the re-denomination of the Iraqi currency and that it’s nothing to fear. But wait before you get all upset, try to forget all of the doom and gloom that has been presented by “those who shall remain nameless” when describing this process and look at some facts.

If you follow the new articles/press releases (not the opinion pieces) Iraq has always described a redenomination/lop. “Those who shall remain namless” are the only ones saying that it won’t Redenominate/LOP. Iraq has stated that the income of the people would not change, but the currency would have more buying power. Iraq has stated with the razing of the 000′s that 200,000 old dinar will equal 200 new dinar, 100,000 OD will equal 100 ND, 250 OD = .25 ND, 50 OD = .05 ND… According to the examples Iraq has given, the razing of the 000′s will effect the currency and by default the exchange rate (.00085 – $1 becomes .85 – $1). If it continues to go the way Iraq has always said it will go, we are at best looking at a possible breaking even with a 1-1 exchange rate, depending on when you bought your dinar (what rate you paid for your dinar). The new dinar or lower demons, are supposed to be replacing the old denoms. The two will coexist in circulation for 2-4 years, but possessors will have up to 10 years to exchange before being retired and becoming worthless.

Why would Iraq re-denominate their currency?

In times of inflation, the same number of monetary units have continually decreasing purchasing power. In other words, prices of products and services must be expressed in higher numbers. If these numbers become excessively large, they can impede daily transactions because of the risk and inconvenience of carrying stacks of bills, or the strain on systems, e.g. automatic teller machines (ATMs), or because human psychology does not handle large numbers well. The authorities may alleviate this problem by redenomination: a new unit replaces the old unit with a fixed number of old units being converted to 1 new unit. If inflation is the reason for redenomination, this ratio is much larger than 1, usually a positive integral power of 10 like 100, 1000 or 1 million, and the procedure can be referred to as “cutting zeroes”.

I have been saying this since I first came to DV! I am glad to see someone who sees the common sense side of things! I am sure that DinarBot and CanukLady and Precious1 will love you for this!

I do not think we will become millionaires over night (even though its nice to hope for!) but instead triple our profit. Based off surrounding countries and all countries in the world I could see this going to almost 8x our initial investment! (thats just my opinion though!) But definitely at least double! Which is not bad for a couple thousand dollars and a couple years!

[sportfisher]

I am not in this for a stinkin' "Redenomination"

[HopefulTxn]

Kuwait did it because they wanted to issue a new currency because old plates were stolen.

The only place I have seen this claim made was in chats by Medic, but never with any links to articles or anything to support it.

Why would the plates have even been in Kuwait since their currency was being printed by De La Rue? Here is a LINK that refers to a change that was made to the KWD in 1986 to add lines of micro-printed text, and De La Rue made a mistake by printing 'Central Bank of Yemen' in the microcode on the back of the notes.

[wingit]

I am not in this for a stinkin' "Redenomination"

None of us are. Just say over and over I will not loose money on this investment. Then you will be 100% correct. Don't get better than 100%. Cheers

[Darin]

The only place I have seen this claim made was in chats by Medic, but never with any links to articles or anything to support it.

Why would the plates have even been in Kuwait since their currency was being printed by De La Rue? Here is a LINK that refers to a change that was made to the KWD in 1986 to add lines of micro-printed text, and De La Rue made a mistake by printing 'Central Bank of Yemen' in the microcode on the back of the notes.

I am only recalling what I read, but not sure where.

This is a quick summary:

Iraq invaded. Invaded the banks. Banks were shut down for a period of time. Kuwaitis feared their currency was worthless.

It sold for pennies to nickels on the dollar. Banks re-opened, and had a new currency. Exchanged 1:1

Those that bought up for pennies or nickels on the dollar made money.

[keepmwlknfny]

In some cases, re-denominations can be done at 1:1 (See Kuwait)

They've referenced them as a R/D on numerous occassions

So now Kuwait redenominated? Where and who did you hear that from?? I dont think I have EVER seen ANYONE reference Kuwait as a RD.....

[WTX_Danny]

History shows us Iraq can do what they want. NY TIMES - Fortune in Iraqi Bills Gone Overnight

[keepmwlknfny]

History shows us Iraq can do what they want. NY TIMES - Fortune in Iraqi Bills Gone Overnight

I remember reading that.....thats always something we have to consider because Iraq has done this twice before (close the borders to outside exchanges)

Hopefully this isent a repeated trend....

[Darin]

So now Kuwait redenominated? Where and who did you hear that from?? I dont think I have EVER seen ANYONE reference Kuwait as a RD.....

Uhm, through articles that relate to Kuwait and their currency situation.

Even where most of them relate to the IQD that are Pro-Lop articles.

They reference Kuwait as a redenomination

But we know of the situation as a new currency issued at 1:1 exchange

I even pointed that out in one topic you posted in once going see KeepM, this person even referred to it as a R/D and they're speaking in terms of a LOP regarding IQD & in terms of a R/D in terms of KWD.

I've heard others, who are quite knowledgeable regard this phrase.

Not all R/Ds are LOPs, but all LOPs are R/Ds.

That is what I recall initially learning regarding the R/D.

[Darin]

KeepM,

Go to wikipedia, and type: redenomination

"Show" List of currency redenominations

You will find 1:1 exchanges, and also exchange where new:old is not 1000:1 for example, but less (i.e., 0.585274)

They list their reasons, such as: monetary union, renaming, etc.

This shows that a R/D can be an even-exchange or something of the opposite where it actually is worth more..

Also, the numbers don't have to even.... So it doesn't necessarily have to be a 1000:1, it could be 587:1

I.e., A monetary union is a re-denomination and may have a conversion of less than "1"

[keepmwlknfny]

KeepM,

Go to wikipedia, and type: redenomination

"Show" List of currency redenominations

You will find 1:1 exchanges, and also exchange where new:old is not 1000:1 for example, but less (i.e., 0.585274)

They list their reasons, such as: monetary union, renaming, etc.

This shows that a R/D can be an even-exchange or something of the opposite where it actually is worth more..

Also, the numbers don't have to even.... So it doesn't necessarily have to be a 1000:1, it could be 587:1

I.e., A monetary union is a re-denomination and may have a conversion of less than "1"

I understand you can have a 1 to 1 exchange and it be a redenomination.....and those countries that did that were either changing the name of the currency, or switching to a completely different currency altogether.....

So how come you cant find any literature what-so-ever that refers to what happened in Kuwait as a redenomination?? They didnt change the name of the currency, and they didnt switch to a different currency.....

I suppose its because it wasent.....

In any case, I think you and me both know that the CBI is talking about a lop....whether or not this is truely the plan of course is up for debate....

Edited January 27, 2012 by keepmwlknfny

[Darin]

I understand you can have a 1 to 1 exchange and it be a redenomination.....and those countries that did that were either changing the name of the currency, or switching to a completely different currency altogether.....

So how come you cant find any literature what-so-ever that refers to what happened in Kuwait as a redenomination?? They didnt change the name of the currency, and they didnt switch to a different currency.....

I suppose its because it wasent.....

In any case, I think you and me both know that the CBI is talking about a lop....whether or not this is truely the plan of course is up for debate....

Finding any information regarding what Kuwait did is relatively difficult to begin with.

I've just heard and read through numerous sources (including those that think the IQD will LOP) that the KWD was re-denominated.

What I posted to prove to you was that a R/D can be considered a 1:1 exchange.

And since the KWD was exchanged 1:1, I am sure some would argue it can be considered a R/D.

Old Currency for New Currency

So, what could the CBI have planned with their statements?

In a dream world, they will re-denominate removing the 3 zeros (but not touching the exchange rate).

They will issue new notes without the 3 zeros.. After this is complete, they will adjust the exchange rate accordingly to allow for proper use of lower denoms in the market place.

Ideally, that is the perfect world.

IQD - nIQD

The possibilities are nearly endless to reach desired results..

Hybrid scenarios

Lops

RVs w/ release of LDs

Slow rise

Remove zero or two and let rise slowly

etc. etc. etc.

[keepmwlknfny]

What I posted to prove to you was that a R/D can be considered a 1:1 exchange.

And since the KWD was exchanged 1:1, I am sure some would argue it can be considered a R/D.

Old Currency for New Currency

And I understand it can be a 1 to 1.....but in those instances that fall under that category, they either switched to a completely different currency, and/or they changed the name of the currency (essentially creating a new currency altogether)

You would think that if the Kuwait situation was really an example of a redenomination, then you could find some literature on it....if you go down that list of countries that redenominated and search for information on it, there are plenty of hits availible....you type in Kuwait redenomination and all that comes up is Iraq.....

But none of that even really matters cause the CBI is "planning" on redenominating by removing the zeros.....thats been pretty clear to you and me.....

[jmw]

Finding any information regarding what Kuwait did is relatively difficult to begin with.

I've just heard and read through numerous sources (including those that think the IQD will LOP) that the KWD was re-denominated.

What I posted to prove to you was that a R/D can be considered a 1:1 exchange.

And since the KWD was exchanged 1:1, I am sure some would argue it can be considered a R/D.

Old Currency for New Currency

So, what could the CBI have planned with their statements?

In a dream world, they will re-denominate removing the 3 zeros (but not touching the exchange rate).

They will issue new notes without the 3 zeros.. After this is complete, they will adjust the exchange rate accordingly to allow for proper use of lower denoms in the market place.

Ideally, that is the perfect world.

IQD - nIQD

The possibilities are nearly endless to reach desired results..

Hybrid scenarios

Lops

RVs w/ release of LDs

Slow rise

Remove zero or two and let rise slowly

etc. etc. etc.

Nope...Kuwait did not redenominate..they issued a new currency as a replacement...here is the definition of a redenomination:

1. The process whereby a country's currency is recalibrated due to significant inflation and currency devaluation. Certain currencies have been redenominated a number of times over the last century for various reasons.

2. The process of changing the currency value on a financial security.

Investopedia explains 'Redenomination'

1. For example, the Bulgarian lev was redenominated due to inflation arising at the end of the Second World War. After the redenomination, one "new" lev was equal to 100 "old" levs. The lev was redenominated three times in the twentieth century.

2. A recent example of redenomination arose when the euro was introduced and the denomination on many European securities had to be changed to the euro.

Read more: http://www.investopedia.com/terms/r/redenomination.asp#ixzz1khbE4qFf

[MrFnHappy]

From all I have read, Kuwait re-issued their currency, but did not re-denominate it.