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My "So Simple, Even a Caveman Can Do It" Theory

DgreenFSU66

By DgreenFSU66,
in Dinar Rumors

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DgreenFSU66 Newbie

DgreenFSU66

Posted
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Pacsters post made me do some research- Here is my best theory, no date, just the rate and what to expect. IMO

First, they must have a transition that is simple to do, and understand. Most Iraqi`s are not formally educated, this is more true the further you get from Baghdad. So, what system would be the easist to start with? Remove the three zero`s from the price of goods in the stores. Example, a 3000 Dinar loaf of bread is now 3 Dinar. A 800000 Dinar TV is now 800 Dinar...

This "removal" of the three zeros on the prices of goods would be the effect of a ReValue at a rate of .86 cents on the dollar. (M-E-D may be right!!!)

The BIGGEST QUESTION IS WHAT TO DO WITH ALL THE CURRENCY ON THE MARKET 43 Trillion Dinar (M2) (not sure if that is even a true figure).

1) Do they LOP and then RV?

2) or is it a straight up RV to .86?

Lets look at that.....

My gut feeling is that if they LOPPED, there would be revolution, bloodshead. All the rich Iraqi`s would lose three zeros off their bank accounts. Lets say i have 4,000,000 Dinar. If they LOPPED, now i have 4,000 Dinar, and if they RV`d at .86 on the dollar to make it simple for the merchants on the pricing, i would have the value of 3,440 US Dollars that i paid 4,240 for.... now i have LOST money!!! and so has Iraq, and the world... This is directly against what Maliki stated..He states that the currency is UNDERVALUED..and its time for it to be respected!!!!

.86 on the dollar also helps with the amount of M2 on the market.....They pay out only .86 on the Dinar and suck in all the big bills without have to completely tap out. Then after the big bills are sucked in by Dec 31st, 2010. They RV the new currency, and Viola... they are now sitting on a Black Gold Mine...The currency has been reigned in and they can float it on a managed Float or just RV it..(This part is way out of my league).

This is all a plan, Shabibi is a very smart man. Why would the US GOV and the IMF allow them to print more than what they can cover... SIMPLE.. THEY WOULDNT.

Its so simple a caveman can do it. Remove the zeros from the "price", easy to do. Give .86USD per 1 Dinar, suck in the big bills by Dec 31, 2010 (MOF Plan). Then Jan 1, it takes off.

This is all just a theory, please feel free to shoot holes all through it... im not stating facts, just trying to work it out in my head. I would love to hear from others that have a better grasp on this subject than what i do.

P.S.- I Heard There Is Life on Mars!

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jackdavis1364 Newbie

jackdavis1364

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The first thing I am going to do, as will 3 billion other people, is to sell the farm and buy dinars. Well, that is not a good example. It will take too long to sell the farm to get the money to buy the dinars. Assuming that the dinars are being traded on the forex, the price will go up overnight from .86 to 3.00 plus as soon as all of the speculators step in with their billions of dollars. And that is exactly what M is trying to avoid. He must keep down inflation. They will RV somewhere in the middle, not too low to bring in speculators but not too high so as to leave some room for it to float upwards slowly.

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Cherysh Apprentice

Cherysh

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Pacsters post made me do some research- Here is my best theory, no date, just the rate and what to expect. IMO

First, they must have a transition that is simple to do, and understand. Most Iraqi`s are not formally educated, this is more true the further you get from Baghdad. So, what system would be the easist to start with? Remove the three zero`s from the price of goods in the stores. Example, a 3000 Dinar loaf of bread is now 3 Dinar. A 800000 Dinar TV is now 800 Dinar...

This "removal" of the three zeros on the prices of goods would be the effect of a ReValue at a rate of .86 cents on the dollar. (M-E-D may be right!!!)

The BIGGEST QUESTION IS WHAT TO DO WITH ALL THE CURRENCY ON THE MARKET 43 Trillion Dinar (M2) (not sure if that is even a true figure).

1) Do they LOP and then RV?

2) or is it a straight up RV to .86?

Lets look at that.....

My gut feeling is that if they LOPPED, there would be revolution, bloodshead. All the rich Iraqi`s would lose three zeros off their bank accounts. Lets say i have 4,000,000 Dinar. If they LOPPED, now i have 4,000 Dinar, and if they RV`d at .86 on the dollar to make it simple for the merchants on the pricing, i would have the value of 3,440 US Dollars that i paid 4,240 for.... now i have LOST money!!! and so has Iraq, and the world... This is directly against what Maliki stated..He states that the currency is UNDERVALUED..and its time for it to be respected!!!!

.86 on the dollar also helps with the amount of M2 on the market.....They pay out only .86 on the Dinar and suck in all the big bills without have to completely tap out. Then after the big bills are sucked in by Dec 31st, 2010. They RV the new currency, and Viola... they are now sitting on a Black Gold Mine...The currency has been reigned in and they can float it on a managed Float or just RV it..(This part is way out of my league).

This is all a plan, Shabibi is a very smart man. Why would the US GOV and the IMF allow them to print more than what they can cover... SIMPLE.. THEY WOULDNT.

Its so simple a caveman can do it. Remove the zeros from the "price", easy to do. Give .86USD per 1 Dinar, suck in the big bills by Dec 31, 2010 (MOF Plan). Then Jan 1, it takes off.

This is all just a theory, please feel free to shoot holes all through it... im not stating facts, just trying to work it out in my head. I would love to hear from others that have a better grasp on this subject than what i do.

P.S.- I Heard There Is Life on Mars!

I am going to ask a question, only to see if I am understanding the whole "Dropping of 3 zero's". I had thought that its a visual drop of 3 zeros, so say you and I have 1 mill dinar, after dropping 3 zero's, we still have 1 mill dinar, just alot of smaller bills. Am I wrong? I would imagine that the smaller denominations would come before a full blown revalue (I could be wrong again)

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tgar Newbie

tgar

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:confused: I think that in the future I will make a profit on my 2000000 IQD. but with the CBI still selling dinar cheap. Knowing they will have to buy them back at loss, I think the first offer will be around 0.10 $ to recoup the large bills.
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DgreenFSU66 Newbie

DgreenFSU66

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The first thing I am going to do, as will 3 billion other people, is to sell the farm and buy dinars. Well, that is not a good example. It will take too long to sell the farm to get the money to buy the dinars. Assuming that the dinars are being traded on the forex, the price will go up overnight from .86 to 3.00 plus as soon as all of the speculators step in with their billions of dollars. And that is exactly what M is trying to avoid. He must keep down inflation. They will RV somewhere in the middle, not too low to bring in speculators but not too high so as to leave some room for it to float upwards slowly.
Thats a great point.... Maybe there is an internal conflict between, the amount to cover, and a stable rate that will keep the whales out of play.... So maybe 3.22 is a legit Price Point?
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DmsC Newbie

DmsC

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:confused: I think that in the future I will make a profit on my 2000000 IQD. but with the CBI still selling dinar cheap. Knowing they will have to buy them back at loss, I think the first offer will be around 0.10 $ to recoup the large bills.

I think they will have to go a bit higher to get the larger bills back than .10 JMO of course but I'm still thinking that it will eb around what the euro is @ 1.30 frame. One it puts in line with the other currencies in the region and still have some room to grow. again jmo

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FDyer Newbie

FDyer

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DGreen...this is a good point, same thing I was saying in another thread. If drops 3 zeros, also has to move 3 decimal places from the .00086 (would equal .86)/from 1170IQD (would be 1.17) (SAME THING.) Otherwise all woud LOSE money with the removal of zeros from the currency itself. So then if rate was also changed to .86, and was applied to the 25000 note...bam! And was thinking we would be forced to cash out at this rate (which would not be bad IMO) or if possible trade for the smaller denoms to see if it RV later.

But ClydeDriver had an interesting point posted in the thread where I was describing this same theory as you. They can do this by lopping AND an RV without the moving of 3 decimal places to get the .86 rate. If they removed the 3 zeros, 1000IQD would equal 1IQD. The 1000IQD originally at

.00086 = $.86 USD Instead of changing the .00086 to .86, they would then RV! So now you have 1IQD instead of 1000IQD. Now say the rate for RV is 2:1. You now have $2 USD for your 1IQD. This is a ROI, but does not equal out to what some think.....if they have 2,000,000 IQD and RV is 2:1 they think they will have $2,000,0000 USD.

This analysis by ClydeDriver seems sound. It could be a decent ROI depending on what they RV (We could lose money if RV to low or barely break even.) but it is nothing like we though it would be.

NOTE: This is not exact quote of ClydeDriver, just relaying the concept the best that I understood it.

I do NOT want this to be the case...however, could someone PLEASE tell me why they would NOT do it this way???

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Jinks123 Newbie

Jinks123

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I am newly invested in the dinar craze and have become a reasearch junkie. I fully understand that the rv is immenint for iraq to be put on the global forefront. My question is like many with talks of a lop, what will it do to my investment. I wasnt investing to become a millionaire overnight, but it seems that it could be a possibility. With the lop i agree that it would deeply affect the wealthy iraqi citizens but ive seen worse things happen. i also agree that with the rv the large denoms have to be pulled from circulation. My question is what is the medium to keep value in place for all of the global investors and not put iraq in a postion where they cant cover the payout??? IMO the rv has to take place at a gradual pace but at the same time the large denoms have to be removed. i know most will cash in as soon as a rv hits, do you think we will be in jeapordy with large denoms if we hold out???? please enlighten me

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whisky runner Newbie

whisky runner

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back in Jan. a person working with the cbi people said that the cbi is going to buy the 3 zero notes back at a certain price ... he mention something like $1,500 a millions ... it getting interresting bringing these old stories from 3 years ago about lopping the zero ... by lopping the 3 zero and making the 25000 note 25 dinar and at .86 make the 25000 note worth $21.50 ... so who know with the rumors going around what we wind up with ...

here is another rumor from a bank lawer ... iraq dinar will come out on an international market ... it will go to float and devalue for a couple of years and as the oil and economy grows then the dinar will go up ... who knows what it will do ...

here is another rumor ... drop the 3 zero and we cash in at .86 a dinar and we all walk away counting our cash ... be nice ... hoping on thios one

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joeintt Newbie

joeintt

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:confused: I think that in the future I will make a profit on my 2000000 IQD. but with the CBI still selling dinar cheap. Knowing they will have to buy them back at loss....

This is exactly the point that I cannot wrap my head around......how can they face this hit??? Why would they allow this hit??? That is why I believe that a LOP (to reduce the zeros and make the IQD more managable) and then an RV (to give Iraq credibility in the international community) of about 2.65 to 3.22.

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