IRAQ’S DINAR: Still Stuck in the Wild West of Currencies! ( February 22, 2012 )

[ALBUNDY]

Iraq’s Dinar: Still Stuck in the Wild West of Currencies

Published February 22, 2012

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While most investors realize Iraq is still a dangerous place to travel to, they may not fully grasp the financial

risks tied to trading in the nation’s currency, the dinar.

Worried about the dinar’s illiquidity, the threat of currency fraud and still-unstable situation in Iraq, Wells
Fargo (WFC) issued a warning this week urging investors to steer clear of the currency.

“Considering that Iraq remains a dangerous place with an uncertain future, we strongly advise investors against taking the risk of buying Iraqi dinar as an investment,” Paul Christopher, chief international investment strategist at Wells Fargo Advisors, wrote in a note in response to investor curiosity about
the currency.

Introduced as Iraq’s new currency in 2004 after the fall of Saddam Hussein’s regime, the dinar, which recently traded at about 1,165 dinar per U.S. dollar, is still only available in paper form because most U.S. banks decline to deal it.

That means the dinar is still very much a part of the Wild West of the currency world, an area most investors should probably avoid funneling money to. 

Yet investors are clearly curious about the dinar, largely because of yet-to-be-realized hopes that the Iraqi Central Bank will revalue the currency by resetting its exchange rate at a more favorable value. They point to similar economic rebounds and currency revaluations in West Germany after World War II and in Kuwait after Saddam’s 1991 invasion.

Yet Christopher spells out four main risks to buying into the dinar now: the threat of future violence in Iraq, illiquidity, risk of fraud and historical precedent.

While Iraq has clearly made great political strides in recent years, the political unity between Iraq's three competing ethnic groups remains extremely fragile. Plus, foreign influence, especially from that of Iran, threatens to further inflame political tensions. 

“Iraq’s post-war experience shows much stronger ethnic divisions than was the case in Germany or Kuwait, prior to their currency revaluation,” Christopher wrote. “While the economy grapples with violence, the prospect of a currency revaluation seems remote.”

But even if the political and violence situations didn’t cast a pall over the dinar, the illiquid nature of the currency makes investment impractical.

Because few of the world’s banks outside the Middle East work with Iraqi banks, most investors are forced to buy actual physical dinar banknotes (rather than the electronic form of the currency like a euro
investor would). Dealers in banknotes charge customers for the cost of shipping, handling and buying/selling the dinar in a wholesale market, Christopher said.

“The costs for buying or selling the dinar may absorb most or even all of an investor’s return,” Christopher said.

Without any banks to work with, investors in the Iraqi dinar are often forced to work with Internet trading companies and potentially shady dinar dealers that aren’t closely regulated by the U.S. government. That leaves investors open to the risk of fraud.

Christopher pointed to the fact that the Iraqi dinar trade ranked No. 6 on the Utah Department of Commerce’s list of top 10 frauds of 2006.

“We suggest many [currency] recommendations that we believe have much less liquidity, fraud and principal risk,” Christopher said

Read more: http://www.foxbusiness.com/markets/2012/02/22/iraqs-dinar-still-stuck-in-wild-west-currencies/

 

[Lenape]

Great

[JuryPicker]

Why post such an old article?

[fib1618]

go rv

[4aprofit]

This is old news, or at least nothing different than what is put out occassionally to deter speculation. I have heard it all before, and stuff like this has been coming out since the currency was issued, and even while the same bank was deaing in it...how odd?..Then they take Utah as a case example, where as some dinar dealers did some things that were unethical, no different than any other business fraud, so when they take things out of perspective like this, and twist it around to fit what they want to convey, this shows this is a smoke screen to deter investors. You have to ask yourself this, why did the U.S. Govt., the U.S. Treasury, The Federal Reserve, the Central Bank of Iraq and the Govt. of Iraq allow this currency to be put out as they have...and it has been going on now for appx. 10 years...and no one in any official capacity has ever stepped up to the plate and called the dinar a "SCAM"...especially as per televising it as such, and/or shutting it down as a whole...because as long as it's been around...WHY NOT?...Is it that they dont know?..lol....

 

What I also find strange is where is U.S. Media on the huge monetary events that have been taking place in Iraq, as they have never shown much of anything, and you cannot tell me that investigative news journalists DONT KNOW...that's B.S.!....All of this is IMO...but I really dont think that most of us were to know about tis an an investment...we know that if this same bank had their employeees holding dinars, as per them endorsing it, upon any type of revaluation..there would go all the worker bees!...lol...

 

Also, I love articles like these, they actually excite and encourage me, and show that were moving closer, as we have always known that the closer we get, the more negativity we would see, at least as per past events like this, whereby negative news was put out right before any huge monetary movement or event happened....to deter speculators...and most of us know that it cannot work any other way...as if everyone was in everything, there would be no balance and it wouldnt work anyway...

 

(Just never forget, the entire world is moving into Iraq, and the monetary investments are already in the trillions, just go investigate first why media is hiding this and you just may find out where articles like this one came from as well....lol).......

[Dinar_o'saurs]

Took the words right out of my mouth 4aprofit.

I bet Mr. Christopher holds some dinar.     However, he'll be more than happy to recommend another currency to speculate in.

 

 

This is old news, or at least nothing different than what is put out occassionally to deter speculation. I have heard it all before, and stuff like this has been coming out since the currency was issued, and even while the same bank was deaing in it...how odd?..Then they take Utah as a case example, where as some dinar dealers did some things that were unethical, no different than any other business fraud, so when they take things out of perspective like this, and twist it around to fit what they want to convey, this shows this is a smoke screen to deter investors. You have to ask yourself this, why did the U.S. Govt., the U.S. Treasury, The Federal Reserve, the Central Bank of Iraq and the Govt. of Iraq allow this currency to be put out as they have...and it has been going on now for appx. 10 years...and no one in any official capacity has ever stepped up to the plate and called the dinar a "SCAM"...especially as per televising it as such, and/or shutting it down as a whole...because as long as it's been around...WHY NOT?...Is it that they dont know?..lol....

 

What I also find strange is where is U.S. Media on the huge monetary events that have been taking place in Iraq, as they have never shown much of anything, and you cannot tell me that investigative news journalists DONT KNOW...that's B.S.!....All of this is IMO...but I really dont think that most of us were to know about tis an an investment...we know that if this same bank had their employeees holding dinars, as per them endorsing it, upon any type of revaluation..there would go all the worker bees!...lol...

 

Also, I love articles like these, they actually excite and encourage me, and show that were moving closer, as we have always known that the closer we get, the more negativity we would see, at least as per past events like this, whereby negative news was put out right before any huge monetary movement or event happened....to deter speculators...and most of us know that it cannot work any other way...as if everyone was in everything, there would be no balance and it wouldnt work anyway...

 

(Just never forget, the entire world is moving into Iraq, and the monetary investments are already in the trillions, just go investigate first why media is hiding this and you just may find out where articles like this one came from as well....lol).......

 

[staunch]

This is old news, or at least nothing different than what is put out occassionally to deter speculation. I have heard it all before, and stuff like this has been coming out since the currency was issued, and even while the same bank was deaing in it...how odd?..Then they take Utah as a case example, where as some dinar dealers did some things that were unethical, no different than any other business fraud, so when they take things out of perspective like this, and twist it around to fit what they want to convey, this shows this is a smoke screen to deter investors. You have to ask yourself this, why did the U.S. Govt., the U.S. Treasury, The Federal Reserve, the Central Bank of Iraq and the Govt. of Iraq allow this currency to be put out as they have...and it has been going on now for appx. 10 years...and no one in any official capacity has ever stepped up to the plate and called the dinar a "SCAM"...especially as per televising it as such, and/or shutting it down as a whole...because as long as it's been around...WHY NOT?...Is it that they dont know?..lol....

 

What I also find strange is where is U.S. Media on the huge monetary events that have been taking place in Iraq, as they have never shown much of anything, and you cannot tell me that investigative news journalists DONT KNOW...that's B.S.!....All of this is IMO...but I really dont think that most of us were to know about tis an an investment...we know that if this same bank had their employeees holding dinars, as per them endorsing it, upon any type of revaluation..there would go all the worker bees!...lol...

 

Also, I love articles like these, they actually excite and encourage me, and show that were moving closer, as we have always known that the closer we get, the more negativity we would see, at least as per past events like this, whereby negative news was put out right before any huge monetary movement or event happened....to deter speculators...and most of us know that it cannot work any other way...as if everyone was in everything, there would be no balance and it wouldnt work anyway...

 

(Just never forget, the entire world is moving into Iraq, and the monetary investments are already in the trillions, just go investigate first why media is hiding this and you just may find out where articles like this one came from as well....lol).......

I agree with all. Some very good points in there. The only thing that bothers me is its coming from one of the biggest players if this were to happen.

[LIBoy]

This is old news, or at least nothing different than what is put out occassionally to deter speculation. I have heard it all before, and stuff like this has been coming out since the currency was issued, and even while the same bank was deaing in it...how odd?..Then they take Utah as a case example, where as some dinar dealers did some things that were unethical, no different than any other business fraud, so when they take things out of perspective like this, and twist it around to fit what they want to convey, this shows this is a smoke screen to deter investors. You have to ask yourself this, why did the U.S. Govt., the U.S. Treasury, The Federal Reserve, the Central Bank of Iraq and the Govt. of Iraq allow this currency to be put out as they have...and it has been going on now for appx. 10 years...and no one in any official capacity has ever stepped up to the plate and called the dinar a "SCAM"...especially as per televising it as such, and/or shutting it down as a whole...because as long as it's been around...WHY NOT?...Is it that they dont know?..lol....

 

What I also find strange is where is U.S. Media on the huge monetary events that have been taking place in Iraq, as they have never shown much of anything, and you cannot tell me that investigative news journalists DONT KNOW...that's B.S.!....All of this is IMO...but I really dont think that most of us were to know about tis an an investment...we know that if this same bank had their employeees holding dinars, as per them endorsing it, upon any type of revaluation..there would go all the worker bees!...lol...

 

Also, I love articles like these, they actually excite and encourage me, and show that were moving closer, as we have always known that the closer we get, the more negativity we would see, at least as per past events like this, whereby negative news was put out right before any huge monetary movement or event happened....to deter speculators...and most of us know that it cannot work any other way...as if everyone was in everything, there would be no balance and it wouldnt work anyway...

 

(Just never forget, the entire world is moving into Iraq, and the monetary investments are already in the trillions, just go investigate first why media is hiding this and you just may find out where articles like this one came from as well....lol).......

I respect your opinion but I disagree.  This man is an investment expert with Wells Fargo.  He is in a business where your reputation is everything.  This guy is not going to give this advice in order to throw his investors off.  That would make no sense at all.  If he deterred all his clients from investing in dinar and then it revalues making people millions, his career would be over.  I don;t think any banker would take that chance.  His summary of this investment may not be what we want to hear but that does not make it incorrect. He isn't saying this could never happen.  He is only saying that it is risky and under the current conditions it is not likely to happen YET.  This is a long term investment at best and to expect anything else is risker than the investment itself.  I love this investment simply because I feel it is the perfect example of high risk, high reward. 

Edited February 23, 2013 by LIBoy

[dontlop]

i dont think he knows enough about it to be commenting,, his biggest problem is all the phone calls  from the dinar owners  asking their employees  about the dinar .. so it has been brought to his attention..

 

 so al he does is turn on his charts ..and makes his digital reviews ..

 

 i highly doubt hes reading the daily updates like we do in this web site .. . so he looks ast the data and statistics ,, draws lines on his charts .. sees the atraight line on the exchange  rate charts .. and writes a column . to serve  all those who have been calling  well fargo for the last 8 years every time theres a new bank story .. they must be driving them nuts,, because they cant  answer any questions  until they have the data .. . but as far as the knowlege of whats going on in iraq .. im sure he has very little up stairs  compared to the dinar vets crowd .

[4aprofit]

What happened when Bear Stearns, Leahman Brothers, Worldcom, Enron, not to mention others...as well as a lot of safehavens to park our money in.....TANKED!.....Was'nt some of the media and the establishment per sey, actually behind these firms at one time or another, or at least as per some endorsing of the same?....Some of the most influential people and firms have bilked the masses out of the most...and this has been proven time and time again all throughout history!..So WHO is the Authority on ANY Investment?....And why has'nt any of these so-called experts shown us that the dinar has actually lost since it's inception, as it has made gains for many, how could they have missed this, unless they missed it INTENTIONALLY!...Just like the article IMO...an intentional misleading of the masses...but one thing is for sure, in the end we will see who is right and who is wrong wont we, as this thing is not over as per the final bell being rung as per the finality of it all...

P.S. They are using negatives WITHOUT facts, while not showing the facts that are out there, that are actually POSITIVE!...and they call themselves experts, professionals, money managers, etc...(I would be scared for any of these guys to try and manage my restroom, much less my boardroom)...lol...I know too many personal friends that have lost a vast fortune or everything they owned, by using many so-called Professionals!... 

[Frank61]

Not to mention he failed to talk about how there are several ways to invest in DIGITAL CURRENCY in Iraq and of course the BIG one .....The ISX.

 

I would like to have a small percent of the $$ Wells Fargo "experts" have lost for their clients.  I would be very wealthy.  They should specialize in RETURN OF INVESTMENT for a change instead of RETURN ON INVESTMENT,

[dog53]

Man I love a long shot.

 

RV BABY  !!!!!!!

[sxsess]

Not to mention he failed to talk about how there are several ways to invest in DIGITAL CURRENCY in Iraq and of course the BIG one .....The ISX.

 

I would like to have a small percent of the $$ Wells Fargo "experts" have lost for their clients.  I would be very wealthy.  They should specialize in RETURN OF INVESTMENT for a change instead of RETURN ON INVESTMENT,

Agreed, this guy is no different than equities analysts that say stay away from certain stocks. Example; an analyst at JMP Securities was telling investors to sell a biotech stock (Dendreon) I was in a few years ago. It went from $4 to $57 and change. I don't listen to people like this. He is probably fresh out of college and is clueless about this currency. All he does is assess risk, nothing else.

[RVDinar4MyFamily]

This is the truth behind this investment and why it is HIGH RISK. 

 

This investment is a long term high, risk investment with possibilities from losing it all, to braking even, to making 2-3 time return or hitting the mother load.

 

Our chances for the mother load lay somewhere in the 5-10% range, sometime in far future. Maybe 30-40% range of making 2-3 times our investment. And the rest lies in the change we lose or break even.

 

Like it or not, this is the truth.

 

There will be people that will try and come up with reasons why an article like this is BS, but it is probably the most honest article I have seen about this investment.  

[4aprofit]

The only thing honest about the article...is that he honestly does'nt know anything...because, how can you give a biased opinion when there are facts substantiating the opposite...B.S. All The Way!...lol...

[rsskelton]

C'mon Wells Fargo.....Chill out or when the big moment arrives, I will take my dinars and go elsewhere.  I believe someone will want my camel currency.

[pontiyak]

Wells fargo is one of the most corrupt banks around.

 

I would be inclined to do exactly the opposite of what they say.

 

I don't pump the Dinar, and I don't encourage anybody to buy Dinars or risk any more

than they can afford to lose.

 

But from what I know of Wells fargo..... this is the biggest smole & mirrors article I have ever seen.

 

Farkin liers.....

 

The best things in life RV

 

yak

[Tirebiter]

The bottom line, unfortunately, is that in the old days, currency wars were based on trying to increase the value of a country's currency.  Now, however, devaluation seems to be the current choice to increase export product values and to cover a country's obligations.  This is a house of cards, imo, that can't be sustained.  Countries like Iraq already have their currency as low as they can go based on the fact they export oil as their primary source of income.  Oil prices are controlled by OPEC and the market.  The conversion of their export is against the dollar.  While the value of the dollar may/will decline, the price of Iraq's export commodity will reflect any changes.  This is not like Greece or South American countries who have nothing to export, or even like Japan, who is competing in the electronics market.  Iraq does not need to devalue their currency to compete.  However, neither do they need to increase their value based on the currency wars going on.  They need stability both economically & governmentally.  In the long run, I think the value of their currency will increase proportionately with more stability in Iraq's economy, stability in government, and when the rest of the world's central banks an economies recognize that the "false" values they keep applying to their currencies fail and are adjusted to reality.  This is no different than the "dot com" boom of the '90s when speculation fueled a false conomy and stock market in the USA.  I think the Iraqi Dinar will increase in value just by normal market conditions, but I'm skeptical that given the current philosophy of other countries actions and central bank jerry-mandering of currencies it will happen in a lrge and quick way.  jmo.

[4aprofit]

On another note, as per Wells Fargo, we saw a couple years ago or so, whereby Warren Buffet bought like 40-50% of the stock in Wells Fargo, at least to the best of my recollection....and this is when many of the new Wells Fargo Baks and Wealth Advisor Centers started popping up in some towns and cities all of a sudden...and this is not to mention the new regional offices that they have setup, specifically targeting families and individuals with $50 million or more to invest, and they have integrated into these new centers, as the article stated, they will have "onboard-physcologists" in these centers, (I've yet to ever hear of anything like this), to help people with what they call "Governance" in their financial and family monetary decisions...as per how to handle their money wisely...to me it looked like it was geared up for "New Found Wealth"...as when did the typical large scale millionaire need a physcologist to show him how to handle his money, IMO...if he did'nt need one to make this money, then why would he need or ask for one now?...I will try to find the articles, as one was in 2010 or 2011, and I believe the other one was in 2011 or 2012...the latter one seemed to be a follow up and update to the first one..

 

In a nutshell, Wells Fargo is gearing up for something big..as in "their words" they state...so if we are in a depression, then what in the world would they be doing building new centers catering and targeting "more" high wealth individuals, when we are in a massive downturn in this economy, with seemingly no future letup of the same, at least during this crisis period we are in...so what could they be waiting for?...If it is'nt the dinar, and/or other currency changes coming, can someone tell me what they are actually doing, at least as per all of this new stuff their doing?......especially as they tell us the opposite, as per the dinar anyway?...lol....

 

Also, Another article was put out depicting where Wells Fargo would see an appx. 30-40% gain in profits during the coming periods, or something to this effect...how odd?...And on one last note, why dont they tell us what is going to bring on all of this "New Found Wealth" that their gearig up for...so we can get in on it, as is'nt that their job, to show us how to make money....instead of telling us what WONT work?...Especially something like the Dinar, that has'nt lost, or yet..or has'nt materialized as per the end results anyway?....LOL....

[sandstorm]

The article list some accurate points, and the basic risks involved. I invested knowing t was a possible high risk, high reward type of speculation