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Re-post of news article in LOP section


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I put this in this section because I would like to hear both sides of this article, even if the word "redenominate" comes up. I'm looking for comments from those stuck here in this section that can't comment otherwise. It sounds like the same ole stuff -- but different -- again. I don't understand fils, etc. This particular articles seems to be saying the reverse: the new dinar will be equal to the old dinar?

Thank you all,

Kimberlye B)

Iraq: An article in "Kurdish Globe" informs that the Central Bank of Iraq plans to issue revalued notes of 50; 100 and 200 "new" dinars; which will be equal to 50,000; 100,000 and 200,000 of the old dinars. If true, this seems to indicate that the current 5,000; 10,000 and 25,000 dinars will continue to be used. As for the small denominations, the plans call for 1 and 2 "new" dinar coins, to gradually replace the current 1000 dinars notes. (Courtesy Kurdish Globe) ...................................05MAR12

Saturday, 25 February 2012

New banknotes to be introduced in September

The Kurdish Globe

Despite fears of a negative economic impact, the Central Bank of Iraq will remove three zeros from Iraqi dinar notes and print new

banknotes in 2013.The Central Bank of Iraq has agreed with the Economic Committee of the Iraqi Parliament to introduce the new

banknotes in September 2012, which will be used in parallel with the current banknotes for a year. The CBI will completely

withdraw the old banknotes by September 2013

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CBI is wanting to get the 3 zero notes off the street which they have managed to do in the curreny auctions but also want to get the notes back from all over the world. They want those notes back. They were never meant to be used by anyone, only bank to bank transactions. However the demand was so huge they didnt have a choice but to print them and put them out. Now they want them back. How do you go about this? Thats the million dollar question. No one really knows for sure. They want the big notes off the street in Iraq and can do that by having the locals go into any bank and trade them in for the new currency. However their rate must change or increase or why would you want to do that in the first place UNLESS you just create a whole new currency and making the current one obselete. Can they do this? Of course, they can do want they want. Will they do this? I highly doubt it. I really do. All they have been speaking about the last few months is making their currency stronger and this is not the way to do it. There would be major implications by doing this from everyone holding the old currency. Iraq could never prosper by doing this in my opinion. THIS IS A COUNTRYS CURRENCY. You want investors to come in, this is not a way to go about it. You can also get the currency back by offering a different rate for everyone out of the country. Not sure they will do this either but could happen. Thats just the problem, no one knows. I am hoping and praying they either remove the 3 zeros off the nominal rate i.e .86 cents or do just a 1-1 trade with the dollar until such time they get most of their currency back. That would make it easier for transactions and banking. They mostly use the dollar now anyway. That would make the most sense. If you think for one minute you will get anything higher than that ,then I'm sorry, you are truly living in a fantasy land. If for the sake of discussion, they do come out at 3-1 ( 3 dollars per 1 dinar) you can prepare yourself for a lop. Why come out that high and confuse everyone like the poor store owners out there trying to figure out how to make change or the bank tellers, etc... Nope not happening in my honest opinion. Yes the dollar is dropping which would make a higher exchange rate feasible, but don't see it. I really expect news to get really negative and bad just before this happens so keep an eye out for that. So to answer your question as to what they are going to do, no one really knows. I know for one thing, whatever they do I will be just fine. They make their currency null and void, then I enjoyed leaving the dream. If I can make 3 times my investment, thats really in my heart what I truly expect BUT always hoping for a 1-1 exchange rate. A man can hope can he? I wish the best for all involved in this investment and I expect we will see something soon...very soon.

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Kimberlye,

The article posted today in the news section is an older article from Feb.that has been cherry picked to only include those words and phrases that can be interpreted as good news...the complete article can be found on "the Kurdish Globe" dated 2/25/2012 in english..the article read in it's entirety might be the clearest and most concise "lop" article to date..

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Kimberlye,

The article posted today in the news section is an older article from Feb.that has been cherry picked to only include those words and phrases that can be interpreted as good news...the complete article can be found on "the Kurdish Globe" dated 2/25/2012 in english..the article read in it's entirety might be the clearest and most concise "lop" article to date..

Unfortunately, I agree with you. It seems to be worded more clearly this time, which seems to make it somewhat confusing, if that makes sense. I'm really looking forward to hearing Dinark's take on this as well as others; kind of a breakdown/timeline, in their opinion.

Thanks for responding Pocono; greatly appreciated.

Kimberlye B)

Either people in LOPster jail go to bed early or they are gettin' their groove on since it's Saturday night!

Yes, WorkerBee, I'm thinking that they have a life outside the dinar. LOL I'm jealous. :P

Kimberlye B)

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I put this in this section because I would like to hear both sides of this article, even if the word "redenominate" comes up. I'm looking for comments from those stuck here in this section that can't comment otherwise. It sounds like the same ole stuff -- but different -- again. I don't understand fils, etc.

There are 1000 fils to the dinar. Its the smallest unit of currency like our penny, but instead of 100 to the dollar is 1000 to the dinar. So 1 new-dianr fil (i.e. issued via the RD) will be worth 1000 IQD fils which equals 1 IQD. So at the current dollar exchange rate that is 0.00086 dollars. Even for new-dinars a 1 fil coin is pointless. A new-dinar 10 fil coin would be nearly a penny (if there were to issue one). If the raise the dollar exchange rate to an even new-diar to 1 USD (an increase of about 16%) , then a 10 fil new-dinar coin would be exactly 1 penny.
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Unfortunately, I agree with you. It seems to be worded more clearly this time, which seems to make it somewhat confusing, if that makes sense. I'm really looking forward to hearing Dinark's take on this as well as others; kind of a breakdown/timeline, in their opinion.

Thanks for responding Pocono; greatly appreciated.

Kimberlye B)

If memory serves JayP posted a link last week to the complete article and was negged back to the stone age..

Yes, WorkerBee, I'm thinking that they have a life outside the dinar. LOL I'm jealous. :P

Kimberlye B)

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All this talk about making their currency stronger seems to be what leads some to believe it "has" to RV. Wouldn't their currency still seem stronger if they redenominate and then revalue the currency? I take that as almost like starting fresh. They would then be able to slowly raise the value of the new currency and the citizens and investors would see the stability in the currency and therefore have faith in the future of the economy and Iraq would grow from there. I wish I could read all the articles as positive, but I just don't see it.

I do have a question, though. Has the deletion of the zeros actually been approved yet? Maybe there's still hope that it won't happen and we can get a slow grow on the currency.

Kimberlye B)

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There are 1000 fils to the dinar. Its the smallest unit of currency like our penny, but instead of 100 to the dollar is 1000 to the dinar. So 1 new-dianr fil (i.e. issued via the RD) will be worth 1000 IQD fils which equals 1 IQD. So at the current dollar exchange rate that is 0.00086 dollars. Even for new-dinars a 1 fil coin is pointless. A new-dinar 10 fil coin would be nearly a penny (if there were to issue one). If the raise the dollar exchange rate to an even new-diar to 1 USD (an increase of about 16%) , then a 10 fil new-dinar coin would be exactly 1 penny.

So will the 50 dinar note be 50 cents? The 1 dinar and 2 dinar coins, what would they be worth? I'm so sorry, but I never can get this, and you explained it so well. Thank you.

Also, it seems Iraq could sure explain a redenomination a lot easier by just saying the old dinar will be worthless after a year and the new dinar will be valued at "whatever." Ugh!!!

he CBI will introduce three new banknotes: 50 dinars, 100 dinars and 200 dinars. For smaller transactions, the CBI will also

issue 1-dinar and 2-dinar coins

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All this talk about making their currency stronger seems to be what leads some to believe it "has" to RV. Wouldn't their currency still seem stronger if they redenominate and then revalue the currency? I take that as almost like starting fresh. They would then be able to slowly raise the value of the new currency and the citizens and investors would see the stability in the currency and therefore have faith in the future of the economy and Iraq would grow from there. I wish I could read all the articles as positive, but I just don't see it.

I do have a question, though. Has the deletion of the zeros actually been approved yet? Maybe there's still hope that it won't happen and we can get a slow grow on the currency.

Kimberlye B)

And that's what the believers hang their hat on...vague references to increasing the value of the currency....there has never been anything indicating an RV other than that ambiguos statement...imo..if they RD and the dinar is on par or equal to the dollar that would have one helluva positive psychological impact on the average Iraqi..

As far as an RV I wouldn't expect anything more than an adjustment to 1000 to 1 before the RD...over time and depending on oil production and stability it might very well increase in value...IMO....

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All this talk about making their currency stronger seems to be what leads some to believe it "has" to RV. Wouldn't their currency still seem stronger if they redenominate and then revalue the currency? I take that as almost like starting fresh. They would then be able to slowly raise the value of the new currency and the citizens and investors would see the stability in the currency and therefore have faith in the future of the economy and Iraq would grow from there. I wish I could read all the articles as positive, but I just don't see it.

I do have a question, though. Has the deletion of the zeros actually been approved yet? Maybe there's still hope that it won't happen and we can get a slow grow on the currency.

Kimberlye B)

Hey Kimberlye,

Thanks for bringing this article over and yeah it clearly says they will redenominate. When they say they will bring in new revalued notes to replace the currency that we hold they are talking about bringing in a new currency with an exchange rate 1000 times higher than the exchange rate for the currenct currency. Sounds like a 1000 times RV doesnt it? This is where alot of the misinformation and wrong interpretations come from. A misunderstanding of redenominations cause such confusion. The thing many do not understand is that they will exchange 1000 to 1. So you get 1 new dinar for 1000 old. Many people cannot accept this so they buy into the nonsense that the confusion causes. The 100% proof that they will not exchange 1 to 1 is that it would take trillions of new lower denom notes to pull that off. It simply isn't happening. That whole argument is too easy to dispell with that fact alone.

You are correct that the 1000, 5000, 10,000, and 25,000 notes will continue to be used but only until they are exchanged for the new currency either during daily transactions or exchanges at banks. So in other words both the old currency (IQD) and the new currency (NIQD) or whatever it will be called will be used to buy any item in Iraq for as long as it takes for all the old currency to be removed or until the CBI demonitizes them with a date in which they no longer will be accepted.

It is simply a basic redenomination. This article and 100s just like it make it clear what is going on not to mention the CBI and Shabibi himself saying over and over agian what they are doing. It sux and I too hope something happens and they dont do it. If they dont I could see the dinar gaining value over a long period of time but it seems too clear that they are stuck on going forward with it and you really cant blame them. It erases the effects of past hyperinflation overnight and creates confidence in the new currency. A 1000 times overnight RV which is impossible would not do this. In fact it would create hyperinflation and smash any confidence in the currency because no one would recognize such an increase.

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Hi Dinarck,

Thank you for responding. That is how I have read all these articles. Yes, you're right, it sucks. I hope they change their mind and find another way to do it, but it's not looking good. So many hopes are going to be shattered when this thing goes down and that is truly sad. Our government has to know what's going on with the dealers selling the dinar and all these IQD sites discussing it. I don't understand why our media didn't publicize what has been going on all these years. I know it's a legal currency and it was our choice to buy it, but they had to know what was going to happen. What is your opinion as to why they wouldn't warn us about a redenomination?

Also, since I don't have the ability to post a question for you on your profile, I need to ask here, even though it's a little off topic. I respect your knowledge and would like your take on Warka as well. I have money in Warka and all the articles coming out of Iraq about Warka being/going bankrupt and some members here voicing problems with their accounts has caused me great concern. Do you believe that the GOI would really "screw" their account holders, even if it was just foreigners that have accounts with them? I don't mean with a redenonination, but I mean actually closing our accounts completely.

Thanks for your response,

Kimberlye B)

It erases the effects of past hyperinflation overnight and creates confidence in the new currency

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Hi Dinarck,

Thank you for responding. That is how I have read all these articles. Yes, you're right, it sucks. I hope they change their mind and find another way to do it, but it's not looking good. So many hopes are going to be shattered when this thing goes down and that is truly sad. Our government has to know what's going on with the dealers selling the dinar and all these IQD sites discussing it. I don't understand why our media didn't publicize what has been going on all these years. I know it's a legal currency and it was our choice to buy it, but they had to know what was going to happen. What is your opinion as to why they wouldn't warn us about a redenomination?

Do you remeber the disclaimer on xe.com? The one about Iraq redenominating in 2010 and then when that didn't happen they changed the date to 2011? The one that was posted on this site ad naseum? I believe there were plenty of warnings out there, we just chose to ignore them. :P

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Hi WorkerBee,

Yes, I remember that. I also think there were warnings coming out of Iraq, i.e., news articles pretty much stating they were going to redenominate. I guess, in my mind, there was always some reason not to believe what was right there in our face; maybe because it was coming out of Iraq and was not to be trusted. Anyway, our media has warned of similar "scams" in the past and made a big ta-doo so consumers would be aware. No, I know this is not a scam in the sense of illegal, but it just seems to me that the media, our government, would have made a big ta-doo out of the IQD being purchased in mass quantities for years and knowing why we were purchasing it -- hopes of millions. If they, the media, our government, would have just come out and said what was happening on these sites and warned the masses, then maybe it would have saved a lot of heartache along the way. Personally, that's one of the reasons I kept hanging on to a possible RV; the fact that our media was so hush-hush about it all.

Have a great Sunday,

Kimberlye B)

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What is your opinion as to why they wouldn't warn us about a redenomination?

What? You mean Big Brother isn't watching you? They tell you it is not a good idea to take drugs, to drink alcohol or to smoke. They tell you there are too many obese people and eating 'super-size' isn't a good idea. But their 'PC' thinking hasn't yet plumbed the depths of telling you NOT to order your Dinner money?

This isn't rocket science...Well, what is, apart from Rocket Science? The big question is, what do rocket scientist say when they can't understand?

Actually, this is so simple. A 1,000 Dinar note becomes a 1 'new' Dinar note (once the new notes have been printed). You get a period of grace to swap your 25,000 note(s) for brand spanking new 25 note(s) and they will be worth the exact same amount - i.e. not a lot!

The dollar exchange rate now becomes 1 new dinar = $0.86 (ish). Then, maybe, we have the 'massive' RV to $1.17 (a number which is often quoted as the incorrect reciprocal). You have now gained around 17% on your investment. Magic! Where else can you get that? BUT...it ain't 1,000x your investment. It never will be. Dinarck is one, among the few, who are the rocket scientists, who get it.

This is a long haul investment. The Gurus spin more yarns than Hans Christian Andersen. Amusing and entertaining, so long as you know it is only a fairy tale. Maybe we will all live happily ever after?

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HI Dinner Money,

Yes, I expected someone to post something about personal responsibility, and I agree with that. No, I don't blame the government for not warning us. Yes, I made the decision to gamble my money on the IQD and I will not sell my dinar until this game is over. I've been in this for years now and have understood that it was a risk that I was willing to take. Since I purchased my dinar, I have learned much through the years because of my own due diigence and the help of much more knowledgeable people, such as Dinarck, who have helped me to understand terminology and processes that I had no knowledge about. I'm more surprised that the media didn't jump all over this, as they have with other "scams" in the past. I can't think of a particular example right now, but there are examples of the media "warning" potential investors that they could potentially lose money or they are being taken advantage of in some way. This just seems like one of those instances, to me anyway. My rationale, right or wrong, through this process was: You would think it would be all over the media warning potential investors. Since it wasn't, I held onto hope that it's just misinformation out of Iraq. I do take personal responsibility for all my decisions; I was simply stating my thoughts in this regard.

Happy Sunday,

Kimberlye B)

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So will the 50 dinar note be 50 cents? The 1 dinar and 2 dinar coins, what would they be worth? I'm so sorry, but I never can get this, and you explained it so well. Thank you.

My pleasure. As for the 50: Now there is a 50 IQD note and its worth a little over 4 cents. (50 IQD divided by 1166 IQD per USD = 0.043 USD). The new-dianr 50 will be worth 1000 times that or about $43 USD. 500 IQD is now worth about 43 cents (though I don't think there is a 500 IQD note). A 500 new-dinar fil coin would be worth the same as 500 IQD are now (a fil is 1/1000 of a dinar and the new-dinar is 1000x the IQD so a new-dinar fil is equal to 1 IQD ). So a new-dinar 500 fil coin (if they make one) would be their equivalent of a 50 cent piece, or half of 1 new-dinar.

Also, it seems Iraq could sure explain a redenomination a lot easier by just saying the old dinar will be worthless after a year and the new dinar will be valued at "whatever." Ugh!!!

They could indeed explain it better, no disagreement there! Hopefully once parliament passes the plan they will publish the real thing instead of all these articles talking about it.

he CBI will introduce three new banknotes: 50 dinars, 100 dinars and 200 dinars. For smaller transactions, the CBI will also

issue 1-dinar and 2-dinar coins

But these are not the only new banknotes, they have talked a lot about the new-dinar 25, and I think they have to produce a new-dinar 5, and 10 as well. Otherwise there is too big of a jump between a 2 dinar coin and a 25 dinar note. Currencies usually have steps of 2x to 5x between each coin or note size.
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The dollar exchange rate now becomes 1 new dinar = $0.86 (ish). Then, maybe, we have the 'massive' RV to $1.17 (a number which is often quoted as the incorrect reciprocal). You have now gained around 17% on your investment. Magic! Where else can you get that? BUT...it ain't 1,000x your investment. It never will be. Dinarck is one, among the few, who are the rocket scientists, who get it.

You're on the right track, but your arithmetic is a bit off. If they RV from 1 new-dianr = $0.86 USD to 1 new-dinar = $1.17 USD (which would move the IQD from $0.00086 USD to $0.00117 since the 1000:1 IQD to new-dianr ratio stays in place) that would be about a 36% increase. Going to an even dollar would be about 17%. But since many folks here bought in around $1200 per Million IQD (i.e. 1 IQD at 0.0012) many would still lose money. The new dinar has to get up to $1.20 for many folks to break even. Plus of course bank fees and spreads. Once the RD is full in swing the demand for IQD will likely disappear so now for dealers to make money trading in IQD for dollars (or new-dinars) they will have to charge less than the rate they get. Now they sell dinars for ~$1200/M and buy them bck for ~$900/M, that's a big spread. Edited by dvforumuser
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Slight correction: Above I said "Once the RD is full in swing the demand for IQD will likely disappear so now for dealers to make money trading in IQD for dollars (or new-dinars) they will have to charge less than the rate they get. "

I should have said the dealer will have to PAY less than the rate they get. i.e. if they are just taking dinars to Iraq and exchanging at the official rate instead of selling them in the US, then they will pay less than the rate they get in Iraq in order to make money. So if the rate in Iraq were to be 1 new dinar = $1.20 USD (the break even point for many), the dealers in the US might only pay you 1 new dinar = $1.00 USD or 1 Million IQD = $1000 USD.

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Kimberlye, there has been talk of a RD since 2006. Baqir Jabr Al-Zubeidi, then finance minister was the first I recall who advocated a RD......needless to say, everyone yelled "smoke and mirrors" back then too.

This article you posted is about as clear as it's going to get, but I'm sure some will still twist it into an RV.

The last nail in the coffin will be when you see a new currency code announced.

Edited by MrFnHappy
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Thank you all for your clarification and confirmation regarding this article and the IQD process. I gained more knowledge from these posts alone, so very much appreciated. I'm in until the end, so I'll pray for a huge miracle; otherwise, my son will have a little investment as the new IQD gains in value; that is unless Warka decides to screw me. ;)

DVforumuser, thanks again for your layman's explanations. My math-challenged brain picks up a little more every time you explain it.

Happy Sunday everybody,

Kimberlye B)

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you guys are so smart.......it gives me chills.....

I think it is probably the possibility of not making much, if any, that is giving you the chills....

sonny1, you would have to admit at some point these articles do not look all that promising! If you have a differing view of them feel free to share it with us.

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Hi Sonny,

I have great respect for your knowledge in this investment as well, so when I ask this, it is with all due respect and sincerity. In your opinion, is this article in fact stating that Iraq plans to redenominate their currency? The others have made valid points, it seems, and I would love to hear something, anything, that could dispute what they have explained above. Not grasping at straws here, just trying to learn both sides of this investment.

Thank you,

Kimberlye B)

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