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How Iraq has exposed its plans from the beginning

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Then on February 23 we received a great find from John1025:

“Finance Minister Baqir Jabr Al-Zubaidi: At the end of this year will see the current Iraqi dinar currency pair and the new Iraqi dinar, which is no different for the same amount, noting that the employee's salary is not affected by the standard of living….. This is not like the ministry, but the jurisdiction of the Central Bank independent of the ministry's proposal but it is the proposal I submitted to me three years ago, by deleting three zeros and the Central Bank studied this proposal and the bank's board finally approved by the end of this year we will see Ammeltian the current Iraqi dinar and the new Iraqi dinar, which is no different for The same amount will not be affected employee's salary and standard of living of the citizen with the survival of the dinar in the same Altdlol .”

Not coincidentally, in my view, Al-Zubaidi refers back to the process that he mentioned 3 years ago, when he said that the plan would come to fulfillment in 3 years. He is fulfilling his own statement and stating without equivocation that the plan is right on schedule.

On February 28 we received the most detailed discussion of the “action plan” yet:

The Iraqi Central Bank defended its policy to withdraw by the deletion of zeros from the cash currency in order to reduce inflation, againt its critics [who say that it is] a policy that is "progressive" and long-term, although most critics regarded the policy as a unit, which the Economic Adviser to the Prime Minister called "in vain" and that it would cost the budget a lot but come to no real avail.

Central Bank adviser Muhammed Al Salih appeared to discuss the economic policy of the central bank for withdrawing cash from the local market due to the "inflation suffered by the money supply, which rose from 25 billion dinars in 1980 to 23 trillion dinars now. He said “it is important to reduce [the money supply]," noting that the process of lifting the zeroes is a "long-term policy adopted by the Iraqi government and the central bank, which will direct the project as soon as the development of the Iraqi economy warrants it, and that this may be this year or next and will probably require a longer time, depending mainly on the stability [of the economy] for the operation."

Saleh told (Voices of Iraq) that "there is no need to rush the process at the moment but at the same time it is required because the subject of reform will not change the value of the currency, except to make the bills smaller." He stressed that Iraq "During the next few years, according to the new development plan, will raise its oil production, and resources will increase significantly.” He added, “and we therefore need a strong currency and low [denomintated notes] at the same time, [thereby making them] easy to handle. "

Later that same day Dr. Saad Al-Hassoun Hayali, a spokesman for the CBI, gave this statement:

“[He added] that the policy of the Iraqi Central Bank [is] to raise and support the Iraqi dinar; [it] is very important in increasing customer confidence in Iraqi dinars, which contribute to increase the volume of foreign investment and local levels in Iraq, and [this is] the axiom of the theory of money, banking, currency and prestige of the state: [namely] when the currency weakens [there is] less prestige of the state.”


And also on the 28th of February we received a statement from none other than Prime Minister Nuri Al-Maliki himself:

“Iraqi Prime Minister Nouri al-Maliki said on Sunday that the process to re-evaluate the Iraqi dinar has to do with economic conditions that have to be strengthened.

"’The Iraqi dinar has all the reasons to grow stronger thanks to an increase in revenues and development of the economy,’ Maliki said in response to some questions through the National Information Center.

"’The government would not rush matters but would rather work on finding all the guarantees to render this measure a success. The Central Bank of Iraq (CBI)Central Bank of Iraq (CBI) is currently entrusted with drawing up a study on the whole issue and would give its decision soon,’ said the Iraqi premier.

“The Iraqi dinar's exchange rate is suffering from low value against foreign currencies as a result of decades of wars and economic embargo that brought the local currency's exchange rate to the rock bottom from three dinars per dollar in the late 1970s and 1980s to 3,000 dinars per dollar after the 1990 invasion of Kuwait, followed by a 13-year crippling sanctions regime.”

On the following day, March 1, Shabibi gave a further clarification of the action plan:

“The governor of the Central Bank of Iraq (CBI) on Monday said that the current exchange rate (1,170 Iraqi dinars per dollar) is reasonable, adding that the bank has enough foreign reserves to defend the exchange rate.

“ ‘The CBI is adopting a managed floating policy of exchange rate, through which a reasonable exchange rate is fixed,’ Sinan Al-Shabibi told Aswat al-Iraq news agency.

“’The current exchange rate is reasonable and stable and can be defended by our vast foreign reserves, totaling $43 billion U.S. dollars at the moment,’ Shabibi explained.”

I have already explained elsewhere how I believe that this article has inaccurately stated the intentions of Shabibi. The phrase in parentheses was interjected into the article by a reporter, and was not stated by Shabibi himself. With its removal the intent of Shabibi is more clear. In addition, as I have argued, the word “current” is also incorrectly translated into English from Arabic and it should read “new” instead.

Therefore, I have argued that Shabibi has announced the final fulfillment of the 5 year “action plan” begun in 2005 and he is right on the schedule laid out 3 years ago by Al-Zubaidi in which he indicated in 2007 that the plan would require another 3 years to complete. Therefore Shabibi’s statement should correctly be understood as the announcement of the adoption of a new exchange rate for the dinar. As I have stated before, the only way in which the last sentence can have proper meaning is for it to refer to a new rate rather than the old (current) rate. Unless a new rate is being discussed the statement that it is “reasonable and stable and can be defended” has no bearing on the old rate whatsoever. The old rate is not only not reasonable, as stated by Maliki the day before as being “too low”; but it also does not need to be “defended” by huge reserves. The reserves of Iraq were only $11 billion just 3 years ago, and the rate was the same then as it is now (.00086). The increase in reserves therefore MUST refer to a new rate that is defensible by these reserves being in place.

Finally, today we received two articles that had to be quickly dismissed by the CBI. The first referred to a new rate coming out at 1000 dinars to 1 dollar in June of this year. The CBI flatly denied that this is in their plan and went further to state that “Iraq’s currency policies are far from such decisions.” By using the word “far” I can only assume that he is stating that the imminent RV will be much higher than 1000 to 1.


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After reading the chat that was posted where you stated the RV has happened and we are looking at a 3+ rate, I thought of two thinks I am truly thankful for.

1. That I bought some dinar

2. That my name is NOT Enorrste

There are a lot of folks building hopes on your statments. I hate to see people get built up for a let down.

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Great post, clearly outlines the history of the dinar. It's way to easy for people to grab the negative articles and run with them when all they really need to do is read you dinar outlines and they would see these lastest articles for what they really are, smokescreens. Thanks for all you do.

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Excellent logic line. They still say the same thing they have said all along. However, putting them together should allow everyone to follow your logic and better see how you reach your conclusions. I really appreciate your efforts in laying out the pert chart of Iraqi plans.

Again, Thanks for the insights into your investigations and analysis.


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Professor E,

You are without a doubt one of the most prolific writers on this forum. Your ability to read, interpret, analyze and explain the information in easy to read posts is not only educational but, it results in entertaining reading. Thank you so much for putting all this time and effort into what you do to help us all understand this roller coaster ride. I look forward to more of your editorials.

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Enorrste... haha first off thanks for the jab.. lol

I like your article an i believe you to be a stand up guy and always base your intel off actual news which i like. All i was really trying to get across was that until it happens we really will never know what they are going to do... That we can read articles and pull out the parts and then try to put them all together... But realistically all of the information above has come from news articles...again which is fine...( its not my friend said this or i heard this.. you have news articles to back it up) But... Until it RV's... And believe me i think it will... we really won't know how it is going to happen or when or even how they are going to do it... b/c no matter how much info we get from the news or try to pull out of articles... it really is all just speculation on till it happens.

Again... I love reading you post.. and seeing your point of view on things... I was just wanting to get across that until it happens no matter what we see or hear... is just speculation.

Thanks again

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Enorrste much kudos to you! You continue to wow us with your amazing analytical ability. You have given clarity in paths where there were no light and created peace in many minds...thank you for all you do. And to those people who continue to make pejorative comments about it and stop this invidiousness now! Great work E!

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Steve, again another great example of assimilating a lot of information. You are amazing, but if you re-read the entire thing, the presumption of an RV is based on this section of your post:

"On the 10th of last month a further clarification of this long process was revealed: “The CBI begins the end of the year and gradually replace the currency now in circulation a new currency which zeroes deleted within the strategy to reform the monetary system started in 2005.” We finally got a clarification of the “delete the three zeros” meaning: it refers to the removal of banks noted with 3 zeros on them from circulation over the remainder of this year. Furthermore, the CBI was nice enough to refer back to the beginning of this long planned process, which it said was begun in 2005 and which we have now documented to be the case."

That is where I think the chain breaks. One does not have to understand that as a reference to retiring the 3 zero bills. "replace the currency now in circulation a new currency which zeroes deleted" is just as easily understood as a redenomination where all currency is replaced. Countries who redenominate hope that it will lend credibility to their currency. Certainly, in Iraq there would be great optimism about values increasing. IMO the only quote in your post that creates difficulty for a redenomination is the one that contrasts Turkey and that seems to be referring to the method/speed of execution.

I know I'm not making any friends on this forum by saying this stuff and I am not saying you are wrong (in fact I hope I am), but the case is not as conclusive as presented. You even recently proposed a theory that included a partial redenomination.

I put the following in a recent post addressed to you on another of your threads but you may not have seen it. It goes to the same point:

"None of them were RV announcements at face value. Let me illustrate: Look at the 2nd and 3rd blog responses to this article in early Feb:

Notice that Aballah Khaled and Engineer Zaid's blog response to that "3 zero" announcement doesn't make it seem that they see this as an improvement in value, but they like it anyway? They only see it as an announcement of a redenomination. So did XE. So did Reuters. (referring of course to this whole thing and the Reuters article that prompted it:"

(that was # 60 here!&p=85095&highlight=#post85095)

I think we dinar investors could be the only ones reading these "3 zero" comments as an RV. JMO. Few will agree I know.

Thanks always for your hard work and for being so generous with information.


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