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rockfl9

Suppose the rate just doubles

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I'm puttting this in the LOP section just to get a free discussion without setting off any alarms!

I have been wracking the brain trying to figure out how it would play out.

suppose10 bbl of oil brings in $850 and translates to 1M IQD in todays market

also, 1 ton of imported wheat flour costs $850 and a policeman is paid 1M IQD per month.

NOW double the exchange rate to .00170.

The 10 bbls of oil is still $850 but converts to only .5 M IQD !

If they continue to pay the policeman 1m IQD /mo. they must lay off 1/2 of the force or the budget for police is doubled.!

The ton of flour is still $850 but now costs the baker 2M IQD so he must double the price of bread!

Would this be a good scenario for the iraqi citizen?

Did I miss something ???

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I'm puttting this in the LOP section just to get a free discussion without setting off any alarms!

I have been wracking the brain trying to figure out how it would play out.

suppose10 bbl of oil brings in $850 and translates to 1M IQD in todays market

also, 1 ton of imported wheat flour costs $850 and a policeman is paid 1M IQD per month.

NOW double the exchange rate to .00170.

The 10 bbls of oil is still $850 but converts to only .5 M IQD !

If they continue to pay the policeman 1m IQD /mo. they must lay off 1/2 of the force or the budget for police is doubled.!

The ton of flour is still $850 but now costs the baker 2M IQD so he must double the price of bread!

Would this be a good scenario for the iraqi citizen?

Did I miss something ???

i think so

theres people in iraq working in a deli making 6 million dinars a year .. what if it rvs dollar per dinar .. do ya think they will get paid 6 million dollars a year ?

everything changes .. if you never owned any stocks or traded stocks ,, this may be hard to under stand ...they have whats called a reverse split in the stock market .. think of each share of stock as a dinar

if you 0wned 100,000 shares of stock .. worth 50.000 dollars .. or 50 cents each .. and they need their stock price to increase to 1 dollar to stay listed on the nasdaq...... which is a requirement by the way .. if it goes below a dollar you only got so much time to get the value up or your kicked out of the nasdaq .. ...

any way they need to raise the value .. so what they often do .. is have a rs .. reverse split .. and your 100,000 shares will turn into say 10,000 shares ,,, but now they are worth 5 dollars for each share ...no change in nominal value .. its still worth 50,000 dollars but its condensed into 10,000 shares from 50,000 shares ..

this is what iraq is saying they are doing ...

rasing the value .. but no nominal change in value .. but each dinar will be worth more ..

you will give them 1000 current dinars for one new dinar ... there by raising the value of the dinar ...

iraq is in now way pre anouncing a rv with these zero deletion storys ...its a no gain .. no loss exchange

now im not saying this is what will be done in the end ... but this is what iraq has been publishing

i hope they are lying to us and do have a rv ..

but if you were making 5 million dinars a year .. worth 5000 dollars... you will be working for 5,000 new dinars a year worth 5000 dollars ......no change in nominal value of what you were getting to what you will be getting ..its that simple .. its called devision.. gusinta.. 1 gusinta 2 .....2 times ,,,2 gusinta 6 ....3 times .

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You are right that the reverse split is the same as lifting the zeros...No change in value ..Just the number of stock certificates. OK for things that stay in-country.

But doubling the exchange rate in the example brings in half the revenue , and doubles the cost of the outgo..

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I feel that raising the Zeros really means that when you go to cash in if you have a $10,000 ID note they will give a $10 ID or $10.00 USD. The same goes for here in the US. It is most likely the cleanest way to gather the money. Once CBI is confident the transition is smooth they then start to raise the value upwards.

Last, I have been reading from the Gurus that we should all be careful with our IQD and give it to no one. I feel this is BS, as it is a fear tactic that so we never attempt to turn it in start to create a flood of just dumping the IQD.I have been in 2 1/2 years and zero return. So if I wait 2 1/2 years and no return... not good. If I wait 5 more years and no change then what... We need to understand our risk and that the IQD is a risk.

Let's go RV

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You are right that the reverse split is the same as lifting the zeros...No change in value ..Just the number of stock certificates. OK for things that stay in-country.

But doubling the exchange rate in the example brings in half the revenue , and doubles the cost of the outgo..

why would they continue to pay the policeman 1 million dinars if the value is doubled ... they would pay him 500,000 dinars per month.. which would be worth the same 850 dollars per month . and the flour would be half ,, not doubled ...only 500,000 .. its backwards upside down inside out thinking .. use common sense .. if it sounds to good to be true it probably is not true..

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Leesburg::: NO the cost of every thing comming into the country would be double the price in dinar terms... I ran that thru the calculator a dozen times ...

So you think it would be acceptable to cut the salaries of civil servants? Policemen have GUNS!

BTW Are you in Leesburg , Fla.?

Edited by rockfl9

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I'm puttting this in the LOP section just to get a free discussion without setting off any alarms!

I have been wracking the brain trying to figure out how it would play out.

suppose10 bbl of oil brings in $850 and translates to 1M IQD in todays market

also, 1 ton of imported wheat flour costs $850 and a policeman is paid 1M IQD per month.

NOW double the exchange rate to .00170.

The 10 bbls of oil is still $850 but converts to only .5 M IQD !

If they continue to pay the policeman 1m IQD /mo. they must lay off 1/2 of the force or the budget for police is doubled.!

The ton of flour is still $850 but now costs the baker 2M IQD so he must double the price of bread!

Would this be a good scenario for the iraqi citizen?

Did I miss something ???

An increase in the rate would increase purchasing power, when coverting to dollars. what benefit would it be if they doubled the rate, just to double the prices in the market. that wouldnt make any sense. it would still incentivize iraqis to continue usage of the dollar, qnd the effect in country would be neutral, if the increase in the rate was equal to the increase in price. i hope im following along properly. i might be missing the point

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Leesburg::: NO the cost of every thing comming into the country would be double the price in dinars... I ran that thru the calculator a dozen times ...

So you think it would be acceptable to cut the salaries of civil servants? Policemen have GUNS!

...

theres so many fils in a dinar .. and so many dinars to make a dollar .. the dollar equals one monatary unit at the imf .. everything goes off of that .. the dollar is the standard .. one monetary unit ... period

the dinar is 1000 fills and if it is 1166 dinars to equal one dollar thats 1,166,000 fils to make one dollar .. you cant change that ... no matter what you do ..its simple division and or multiplication .. iraq will not be changing anything in the international monetary fund .. its all said and done .. theres only one way to increase its value ,,, condense them down by removing zeros .. they can add to their money supply by the same rules that apply to everyone else within the monetary system .. no one gets special privligages .. unless theres something we are all not aware of ... and this is what the speculation is all about .. we are hoping they come out and reset the rate against the dollar along with this zero deletion thing ... if their rates are doubled and then they remove 3 zeros ,, the dinar would be worth 2 dollars after the deletion .. .. i got to go to work now so .. ill read this again after midnight

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Leesburg ::: I think you are correct Income is .5M and out go must be .5M. Should have known they had to ballance. Its just that what took 1M to trade now is .5M

Now how could that happen overnight?

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I think Leesburg means doubling the value... raising the current value of 50% so that 1 USD is now worth 583 Dinars instead of 1166...Nothing much changes for us investors....If I'm wromg, I apologize.

Edited by umbertino

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It mostly changes their purchasing power for imports. If they gradually increased the rate they would not need to adjust salaries. It wouldnt neccessarily impact local pricing. At least not right away.

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Tried to build a chart but lost all my formatting.. rats.

Edited by magawatt

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i see .. but everything has a start point of value .. that is 1 monetary unit ... that monetary unit happens to be a one dollar bill .....the imf is located in washington dc ..

no matter what iraq does to its currency its value will be based off of a single monetary unit... as it changes so does the purchasing power.... now if it gradually goes up .. i see your point ... ... a guy making a million dinars a month (1000 bucks)...changing tires .. what are they going to do ... cut his pay as the dinar increases...... or just let him have corvettes ...boats ,,, country homes ..as it floats up to even exchange one dollar for one dinar.. or will they pay him a million dollars a month to change tires at the local tire shop..

never mind .. i cant figure this out ..

looks like sabby got it figured out sabbybi....shiuppe .. who ever he is .. you know .. that bald guy thats propaganda....ing .... the crap out of this dinner thing

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What rate? The unemployment rate? It will if Barry gets the nod in November, then he can sign an EO to make the presidency permanent and change our name to The Socialist States of Barry Land.

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Dinaris4me::: So you conclude that an overnight to a penny isn't likely?

That would mean a 1,000% (ten fold) RV.......

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Dinaris4me::: So you conclude that an overnight to a penny isn't likely?

Not likely and virtually impossible. There is no value in a sudden increase to Iraq only to speculators.

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Congrats Dinars4me I think you passed ECON101.

In fact the shock would set back their economy... Shabibi, knows this and would not do it while he is in charge.

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Umbertino:::: Yeah. Overnight!??? Chances are zip, nada ,nil , Zero ( dont know how to say it in Arabic) .

I agree....Unfortunately.

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i think so

theres people in iraq working in a deli making 6 million dinars a year .. what if it rvs dollar per dinar .. do ya think they will get paid 6 million dollars a year ?

everything changes .. if you never owned any stocks or traded stocks ,, this may be hard to under stand ...they have whats called a reverse split in the stock market .. think of each share of stock as a dinar

if you 0wned 100,000 shares of stock .. worth 50.000 dollars .. or 50 cents each .. and they need their stock price to increase to 1 dollar to stay listed on the nasdaq...... which is a requirement by the way .. if it goes below a dollar you only got so much time to get the value up or your kicked out of the nasdaq .. ...

any way they need to raise the value .. so what they often do .. is have a rs .. reverse split .. and your 100,000 shares will turn into say 10,000 shares ,,, but now they are worth 5 dollars for each share ...no change in nominal value .. its still worth 50,000 dollars but its condensed into 10,000 shares from 50,000 shares ..

this is what iraq is saying they are doing ...

rasing the value .. but no nominal change in value .. but each dinar will be worth more ..

you will give them 1000 current dinars for one new dinar ... there by raising the value of the dinar ...

iraq is in now way pre anouncing a rv with these zero deletion storys ...its a no gain .. no loss exchange

now im not saying this is what will be done in the end ... but this is what iraq has been publishing

i hope they are lying to us and do have a rv ..

but if you were making 5 million dinars a year .. worth 5000 dollars... you will be working for 5,000 new dinars a year worth 5000 dollars ......no change in nominal value of what you were getting to what you will be getting ..its that simple .. its called devision.. gusinta.. 1 gusinta 2 .....2 times ,,,2 gusinta 6 ....3 times .

Very Well Done I give you a + for this :bravo:

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VIZIORAQI,, That's a LOP!

Go back and read Leesburg's later post where he say we would have to cut the pay of all the Iraqis... Would they stand for that just so "investors " would make a small profit.. I dont think so!

Go Shabibi

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