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***My take on what could possibly go down***


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Why? I see no correlation between GDP growth and currency appreciation. Their exchange rate might go up, but it all depends on their monetary policy. And if you bought in the last year or two (e.g. at $1100/M or so) you are going to need a 40-50% appreciation just to break even.

Currencies appreciate for a number of reasons. From 2006-2009 the IQD appreciated (actually it was incrementally raised) while Iraq was reining in inflation. If inflation gets up over 10% they might start the process again. Also, as conditions improve in Iraq and confidence grows in their country and their economy the currency will likely reflect that. You're right that there's no direct link between GDP growth and currency appreciation, but in Iraq's case there could very well be an indirect link. Of course it could just as easily go the other way. That's why we call it speculation.

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Interesting. That's the first time I've ever heard anybody say that they have printed dinars in order to maintain the exchange rate (based on increasing reserves).

My question has always been, do they print dinars to maintain the exchange rate, or is the exchange rate steady because of the never ending printing of dinars?

Now, you say that they are printing to maintain the exchange rate. My question would be "why?"

Because contrary to guru and pumper widsom countries prefer stability in their exchange rates. Slight fluctuations up or down are okay, but a spike in either direction can have repercussions in the economy. Iraq doesn't want its currency to appreciate too fast because that could stall their economy. So they're managing it with their money supply. I have a feeling though that they're going to have to curb the printing somewhat because they're having trouble getting the street value to reflect the official value. By letting the ratio between their reserves and their M2 tighten a bit they'll be able to achieve that hopefully. I look for Iraq to slow the growth in their money supply in the next month or so.

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Because contrary to guru and pumper widsom countries prefer stability in their exchange rates. Slight fluctuations up or down are okay, but a spike in either direction can have repercussions in the economy. Iraq doesn't want its currency to appreciate too fast because that could stall their economy. So they're managing it with their money supply. I have a feeling though that they're going to have to curb the printing somewhat because they're having trouble getting the street value to reflect the official value. By letting the ratio between their reserves and their M2 tighten a bit they'll be able to achieve that hopefully. I look for Iraq to slow the growth in their money supply in the next month or so.

Sure. But they don't really have an economy in a normal sense do they?

We'vs seen in Australia, where the exchange rate has increased by around 30% in the last couple of years, how much damage it can do to markets such as manufacturing. However, the Australian economy is still one of the strongest in the world because of commodoties.

Iraq's GDP is almost wholly through oil sales, which they get US$ for, so a gradual increase in the value of the dinar over the past few years shouldn't have really done too much damage.

I think you're right on about the difference in the market rate. There is a pretty big discrepency between the official rate and the market rate, which suggests to me that there is too many dinars floating around on the streets.

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Currencies appreciate for a number of reasons. From 2006-2009 the IQD appreciated (actually it was incrementally raised) while Iraq was reining in inflation. If inflation gets up over 10% they might start the process again. Also, as conditions improve in Iraq and confidence grows in their country and their economy the currency will likely reflect that. You're right that there's no direct link between GDP growth and currency appreciation, but in Iraq's case there could very well be an indirect link. Of course it could just as easily go the other way. That's why we call it speculation.

Ok, no argument with any of that.

A hedge against investment X would be something that typically would move in the opposite direction with proportional magnitude. For example shorting or buying puts on the S&P500 index would be a hedge against a broad spectrum of long equity positions. In that light I would say the dinar is certainly not a good hedge against inflation of the dollar since at least some inflation of the dollar is pretty certain and how the dinar will go is far more unpredictable (other than any huge overnight move is impossible) and more importantly the two have little correlation. Plus the dinar has to have 40-50% appreciation before most folks would break even, so again a bad hedge to start off that much in the hole.

Edited by jg167
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Ok, no argument with any of that.

A hedge against investment X would be something that typically would move in the opposite direction with proportional magnitude. For example shorting or buying puts on the S&P500 index would be a hedge against a broad spectrum of long equity positions. In that light I would say the dinar is certainly not a good hedge against inflation of the dollar since at least some inflation of the dollar is pretty certain and how the dinar will go is far more unpredictable (other than any huge overnight move is impossible) and more importantly the two have little correlation. Plus the dinar has to have 40-50% appreciation before most folks would break even, so again a bad hedge to start off that much in the hole.

Agreed. The assumption being that you bought in through a dealer since 2009. If you bought while in Iraq or through a bank prior to 2009 you could have some profit already. This is one of those grey areas that makes it hard to call buying dinar a scam. There's actually some value and some liquidity.

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I don't follow. The value of the country would be their GDP, nothing arbitrary about that, the US is ~15T USD, Iraq is perhaps ~100B USD. The dollar is a floating currency so its value is what ever the rest of the world feels like paying for it. Nothing arbitrary about that either. The Iraqi dinar its pegged, which means the CBI can set the value at whatever they can cover with their reserves. With ~60B USD in reserves and an M2 of ~70T, that is the 0.00086 exchange rate they have now.

No, this is just a pumper lie. Check the CBI history page or any of the historical exchange rate sites and you will see that the dinar was at the $3+ level back in 1987, but by 1995 was more than half its current value (i.e. even worse) at 3000 dinars per 1 USD. That was due to Saddam printing them like the mad nutball he was, printing 10s of trillions with no increase in reserves (which he spent of course). Iraq's GDP, barring something like all out civil war, will very likely increase at a very nice rate. But that in no way implies that their currency will also increase as there is little correlation between the two.

About a 1000x RV being impossible? No, I am not wrong on that. and peace to you too! (I'll remain adamant about what we know, but there is no reason to get upset at folks, life is too short for that!).

Let me start with the USD. Our system was based on GOLD. Yet Nixon did away with that. When we need more currency we print more. The money was at one point bonds. You know this though, right? Remember the dollars with the blue stamp on them. We are not pegged to gold anymore with our currency. I am not even going into the GDP! But thanks for the attempt at my education. I will try to learn from you if I can. As for the old currency value, the worth was what was outside IRAQ which gave it value. A self imposed value doesn;t mean it is that value except internally. Many here seem to think they know how much currency is in circulation (IQD) and they peg that to OIL etc. Again, IMHO everyone is shooting from arbitrary non substanciated "facts."

All these "facts" are really based on information which in my view is not accurate. If you know the trade and many factors which go into assessing a currency value, my ears are perked. So far though I just dont believe we are privied to this in detail.

So are you adament about what you say WE KNOW or YOU believe? I think frustrated is a better word than upset...from me The things you say are based on partial truths and partial facts. You are not totally off the mark, but the proof of everything will be in what happens not what YOU or any of us has to say. You are trying very hard to use other facts in other situations to fit IRAQ and the conclusion of how their currency will change or not. There is no way to be sure of this. I think it is wise to use your type of reasoning rather than that of the pumper... Yet, as for the 1000 x RV, EVEN THAT you can;t be sure of one way or the other. You can think you know what you dont know about... If you have some keen inside knowledge, please impart that on me. Other wise it is not me who is here gloating about what CERTAINY will be or not.

;)

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Agreed. The assumption being that you bought in through a dealer since 2009. If you bought while in Iraq or through a bank prior to 2009 you could have some profit already. This is one of those grey areas that makes it hard to call buying dinar a scam. There's actually some value and some liquidity.

Sure, and for those that are in the black now, I suggest you strongly consider taking at least some of your profit since once the RD is in full swing you won't be able to get anything like the $900-$1000/M you can get now. Edited by jg167
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Sure, and for those that are in the black now, I suggest you strongly consider taking at least some of your profit since once the RD is in full swing you won't be able to get anything like the $900-$1000/M you can get now.

LOL Wow, the above is quite the statement. :rolleyes:

Interesting. Where do you get this knowledge from? You must have better sources than I do. (sarcastic me... sorry)

How do you say the things you do with such confidence? I need to buy you a drink one day and pick that brain...

There comes a time when the mind takes a higher plane of knowledge but can never prove how it got there. ;)

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Sure, and for those that are in the black now, I suggest you strongly consider taking at least some of your profit since once the RD is in full swing you won't be able to get anything like the $900-$1000/M you can get now.

How much are you being paid to encourage people to sell? Have you sold?

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20 Million;; What you call Financial System BS is what we are involved in here.. A few are comming up with some relevant, good stuf to consider!

There is an old saying :

Its not what you dont know that gets you into trouble,

It's what you do know , that isn't true.

Like :

The dinar doesnt have to redenominate. (Maybe later.)

The dinar must revalue toX. XX because it is destined to be the strongest currency in the ME. ( Has to match Kuwait? They are a proud people.)

The dinar must reflect the value of Iraqs resources. Quickly, tomorrow. ( how to pump it or dig it isnt a problem?)

US banks will gladly take the dinar and the FED will store it for oil purchases. ( DUH , The FED has all the dollars it needs.)

Iraq MUST buy back my dinar or the US govt will ????? (send in the troops, again . We have learned our lesson here , I hope)

All I can think of now , .I'm sure IO missed some .

Pay attention or not , your choice.

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You characterize Doctor robbins' analysis as "vapid" while you, just like Easy before you, completely ignore Iraq's gigantic money supply. The GDP of the entire planet is about $63T USD. A RV of the Iraq dinar to $2 would give their money supply a value of around $140T USD while their GDP is less than 1/3 of 1% of the global total. Come on, its just simple arithmetic. It can't happen, its not even remotely close to being possible.

I HATE NUMBERS....THERE ARE JUST TOO MANY OF THEM!...........................ala, Bevis and Butthead

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This is from 4/19/2012. Interesting how you don't give credit where credit is due...

Didn't even bother letting people know that this isn't your work? unsure.gif Not cool Easy! dry.gif

Nice post, but a lot of "what if" hypothetical scenarios. That is why I have a hard time wrapping my head around it blink.gif

**Its getting harder and harder coming here and listening to this new financial system BS that is completely made up! How do you folks fall for this garbage??? Unbelievable...

Interesting.

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LOL Wow, the above is quite the statement. :rolleyes:

Interesting. Where do you get this knowledge from? You must have better sources than I do. (sarcastic me... sorry)

How do you say the things you do with such confidence?

When the RD is in full swing, who will be buying at $900-$1000/M? Would you? Once the RD is going on that will show even the most koolaid addicted that a 1000x return is not possible. So the price is just going to be the official CBI price. But banks not now dealing in IQD are unlikely to start doing so, they will just deal in the new dinar, call them NID. So you will be left with the dealers operating now, assuming they can reverse their current dinar pipeline and send them back to Iraq. But then they will have to make a profit so their buy back price will be substantially less than the official CBI price, likely by about the same amount their buy in price is above it now. So that's going to be say $600. Seems pretty straight forward.

I need to buy you a drink one day and pick that brain...

Always happy to oblige with pickled neurons!

How much are you being paid to encourage people to sell?

Oh be serious.

Have you sold?

Yes.

I HATE NUMBERS....THERE ARE JUST TOO MANY OF THEM!...........................ala, Bevis and Butthead

smile.gif

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So, if you are not invested, why do you feel the need to come on a board like this? Do you have such a big heart that you feel the need to save us all?

Why is this question only asked in dinarland? In all my years of investing I have never seen such asked on forums on stocks, bonds, metals, options, commodities, other currencies, etc.

Spare me.

You voluntarily read my posts, then complain about doing so. Put me on ignore if you like, but don't complain to me about what you do. I mean come on, that doesn't make any sense does it?huh.gif

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Just seems like a silly waste of time for you unless there is an ulterior motive..

Again, no where else but in dinarland. Are you planning to sell prior to your mythical RV? If not then we are YOU here? If it were to happen there is not the slightest possibility that it won't be all over the news. So it must be that you just find the subject interesting and/or the interaction worthwhile in some way. So how is that different?
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Again, no where else but in dinarland. Are you planning to sell prior to your mythical RV? If not then we are YOU here? If it were to happen there is not the slightest possibility that it won't be all over the news. So it must be that you just find the subject interesting and/or the interaction worthwhile in some way. So how is that different?

Unlike you, I don't believe it to be "mythical." If I did, I sure wouldn't be wasting my time here. I would find something that I believe in to pour myself into.

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Unlike you, I don't believe it to be "mythical." If I did, I sure wouldn't be wasting my time here. I would find something that I believe in to pour myself into.

I didn't say YOU believe its mythical, that's the point. You think it will happen, so why waste time on this site? No one is going to tell you ahead of time and you can't possibly "miss it", so why waste your time here?

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Doc Rob,

I have read several comments of yours and that of Jackster, Sandstrom, Dinark in relation to the M1 and M2 numbers. Granted, these numbers, provided by the CBI, have been constantly going up since 2004, when the NID's, were printed. My observation on this is; why then is the exchange rate of the dinar (NID) been improving, since 2004. I mean more circulation should lead to a more unfavorable rate for exchange. I know that the NID is pegged to the USD, but since we are keeping up with their (CBI) numbers (M1+M2) , why should we care about the dollar? It's not like the USA backs all of their M1 & M2, 100% with reserves. Ha! Ha! I mean we are a fiat currency. Why should we expect Iraq do something that we (USA) don't do with our currency? I simply do not believe their (CBI) numbers. This is JMO, but that is all I have to go on, right now, to lead me. I do not believe Iraq can simply just reduce their M1 to 30 billion as they have stated and make it work. That's right, I know they have stated that this is what they are going to do. LOP/RD. I simply just don't believe it. I haven't even seen proof that Iraq has printed any new currency since 2010. I don't speak arabic nor do I work for the CBI or know anyone that does. I do work for a bank and my family has worked in the middle east. Learning from their experiences, I know I am all in, with this investment. Intuition tells me to hold on. Discrepancies like the above mentioned, give me hope. I, like you, am just having a problem with the numbers.

I don't recall talking about M1 and M2 numbers. I don't think I have ever talked about how much dinar was out there.

I usually talk about how someone with $1,000 worth of Dinar one day, has a $1 million the next. Or about how the removal of 3 zeros will get us $1 per 1 IQD.

I have no idea what the CBI number are, except what people claim them to be in here.

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So, if you are not invested, why do you feel the need to come on a board like this? Do you have such a big heart that you feel the need to save us all? Spare me.

If I had 1,000 IQD for every time someone asked that question in here, I'd have about $1,000.

But, then I would only have $1 after they remove 3 zeros.

I've never used caps in here.

FOR THE LOVE OF GOD, QUIT ASKING THAT QUESTION! THE ANSWER WILL NEVER SATISFY YOU! SPARE US !!!

There, I feel better now. Next.

Just seems like a silly waste of time for you unless there is an ulterior motive..

I envision a 14-yr old girl with a high-pitched squeaky voice making that comment. OMG! Smiley face.

There is an ulterior motive. Therefore, no silly waste of time.

Unlike you, I don't believe it to be "mythical." If I did, I sure wouldn't be wasting my time here. I would find something that I believe in to pour myself into.

As she rides off to the Leprechaun's pot of gold on her unicorn.

Edited by jackster
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Enough with the talking down to the members on here.

There is nothing wrong with the question being ask as I have ask it in the past myself. Sometimes we need to find out what is behind the negative motives of some of these people. Is it to cause trouble? Is it to try and steal the dreams of others?

Yes it has been ask a lot in the past and will most likely be ask again in the near future.

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