The impact of a huge currency shock on society

[makecents]

For the folks that believe in a huge sudden RV, I'm curious as to why you think this would not tear society apart?

 

Setting aside for the moment the fiscal impossibility of the CBI covering a $1 RV just consider the outlook of an Iraqi who prior to this event spent a significant portion of their net worth on something and now after the RV sees that had they just waited they would be rich.

 

For the poor this might mean buying the weeks groceries with the remainder of your weeks pay, while had you waited a day that same money would buy 20 years worth of groceries.

 

For the more well off this might mean having bought a car or house in the weeks or months prior to an RV while had they waited they would be multi millionaires.

 

I'm thinking those folks are going to be very upset and in Iraq there are always those looking to channel such feelings into violence.  It seems to me a huge sudden RV would tear the country apart.  And that doesn't even get into items like salaries, loans, contracts, etc.

[dontlop]

belongs in the rumor section at best

[The Machine]

Why are u even here ..... People spend there money on things they need ... Food, housing and if u got a bit extra maybe education.

Do you really think Iraqis could go 10 years without spending any of there dinars while they wait for a revalution of there currency.

All currencies go up and down all the time .... Fact

Iqd is at a value that does not reflect it true potential value ...... The citizens of Iraq will not care what they spent in the past there looking for a future

[Bumper64]

belongs in the rumor section at best

 

 

I think this person is looking for the Lopsters feedback/support and knows that they can't post outside the Lopster tank!!

[makecents]

belongs in the rumor section at best

Its not a rumor, its just a question.

 

Do you really think Iraqis could go 10 years without spending any of there dinars while they wait for a revalution of there currency.

Of course not. I merely said that if you spent say 50,000 IQD on food, then the next day (not 10 years later) find out that had you waited just one day that 50,000 IQD would buy years worth of food, that you would be rather upset. Wouldn't you?

 

All currencies go up and down all the time .... Fact

Iqd is at a value that does not reflect it true potential value ...... The citizens of Iraq will not care what they spent in the past there looking for a future

Sure they go up and down, by tiny amounts (over short periods) and thus do not impact anyone by other than a tiny amount positive or negative so no one cares. I think they WILL care are about what they spent just before the RV as had they waited just a few days it would be multiplied by a huge amount. Your saying a poor person won't care that instead of a loaf of bread worth $4.30 (5,000 pre-RV IQD) they could have had $5,000??

 

I think this person is looking for the Lopsters feedback/support and knows that they can't post outside the Lopster tank!!

No I was just trying to not get in peoples face about it by starting a thread in the other forums.

Edited March 22, 2013 by makecents

[makecents]

oops. fat fingers, please ignore.

Edited March 22, 2013 by makecents

[dontlop]

ya its just another lopster guru rumor

 

No I was just trying to not get in peoples face about it by starting a thread in the other forums.

 so you admit thats what you have been doing ... getting in peoples faces .. thanks .. it was obvious any way but thanks for admitting it

[SnowGlobe7]

Not a rumor..just a question, but it really is more of a "what if" situation.

 

Currency goes up and down all the time...agreed not to the degree that we are hoping for in Iraq, but trust me prices will adjust accordingly.

[makecents]

ya its just another lopster guru rumor

 so you admit thats what you have been doing ... getting in peoples faces .. thanks .. it was obvious any way but thanks for admitting it

Is english your second language?

Not a rumor..just a question, but it really is more of a "what if" situation.

 

Currency goes up and down all the time...agreed not to the degree that we are hoping for in Iraq, but trust me prices will adjust accordingly.

Sure, but I didn't think a "what if" belonged in the rumors section.  Sure prices will adjust, very rapidly I'd say, that is the whole point.  That is why folks will be upset, they will have dramatically overpaid prior to a huge RV based on the price immediately after it.  If I sold you the loaf of bread prior to the RV I have $5000 USD now, you have a $4.30 loaf of bread.   Would you by happy about that?  I don't think so.

[dontlop]

I'm thinking those folks are going to be very upset and in Iraq there are always those looking to channel such feelings into violence.  It seems to me a huge sudden RV would tear the country apart.  And that doesn't even get into items like salaries, loans, contracts, etc.

i dont see this as any different than the opposit views of the opinions of the gurus in the rumor section .

[dinarbeleiver]

It's going to RV and it will be huge makecents go back to the site you have come from

[dontlop]

Is english your second language?

ill just uses your analogy of what you said to another poster in a different thread ..  about attacking the  person instead of staying on topic in your responses . it shows  you cant answer your own posts .

[dinarbeleiver]

I'm sure you real identity is dinarck or whoever

[dontlop]

I'm sure you real identity is dinarck or whoever

i got to agree 100%

[SnowGlobe7]

Is english your second language?

Sure, but I didn't think a "what if" belonged in the rumors section.  Sure prices will adjust, very rapidly I'd say, that is the whole point.  That is why folks will be upset, they will have dramatically overpaid prior to a huge RV based on the price immediately after it.  If I sold you the loaf of bread prior to the RV I have $5000 USD now, you have a $4.30 loaf of bread.   Would you by happy about that?  I don't think so.

 

Was just trying to talk about your comment...frankly if I was able to buy a house in a year when I thought it would be 10 years i am doing a happy dance in the streets....Just the way I think I guess...happy that good fortune has come my way rather than pout about the past. IMO

[makecents]

ill just uses your analogy of what you said to another poster in a different thread ..  about attacking the  person instead of staying on topic in your responses . it shows  you cant answer your own posts .

Your logic is flawed.  Explaining why you did something (in this case to Bumper) does not in any way imply that previously you did the opposite.

 

Why not just engage on the question I asked, or ignore it instead of posting all this other stuff?

[The Machine]

Sure they go up and down, by tiny amounts (over short periods) and thus do not impact anyone by other than a tiny amount positive or negative so no one cares. I think they WILL care are about what they spent just before the RV as had they waited just a few days it would be multiplied by a huge amount. Your saying a poor person won't care that instead of a loaf of bread worth $4.30 (5,000 pre-RV IQD) they could have had $5,000??

 

 

No they go up and down all the time .... up over short periods but in the long term all fiat currencies go down

 

just look at the dollar and how much value has been lost in the past 100 years alone.

 

I do see the point your trying to make, and yeah i'd be a little pissed if I spent $1,000 today and tomorrow that would have been worth $1,000,000 ....... but that's life. its not like there going to announce to all iraqi's " if your thinking of buying that car/ house/ whatever wait till after 24th ..... speculation would go through the roof and collapse the currency.

 

so yeah a few people will be a little pissed but if they have the money to spend there obviously not poor and they probably have a lot more.

[makecents]

Was just trying to talk about your comment...frankly if I was able to buy a house in a year when I thought it would be 10 years i am doing a happy dance in the streets....Just the way I think I guess...happy that good fortune has come my way rather than pout about the past. IMO

 But that is the point.  You buy a house say for 50M IQD (just making up a number) and put 5M down.  Then it RVs, now that 5M you put down would have bought 100 such houses, but the seller of the house has it not you.  What happens to the 45M IQD you owe in the mortgage is another question, but just the lose of the downpayment would be most upsetting, wouldn't it?  

 

Of course if you are in this process and an RV were to happen PRIOR to executing the transaction you would indeed be dancing in the street, which might be all the more galling for the guy that missed out.

No they go up and down all the time .... up over short periods but in the long term all fiat currencies go down

 

just look at the dollar and how much value has been lost in the past 100 years alone.

Sure, but we're not talking about 100 year trends here but an overnight RV of 1000x.

 

I do see the point your trying to make, and yeah i'd be a little pissed if I spent $1,000 today and tomorrow that would have been worth $1,000,000 ....... but that's life. its not like there going to announce to all iraqi's " if your thinking of buying that car/ house/ whatever wait till after 24th ..... speculation would go through the roof and collapse the currency.

Right, but this is one reason to avoid currency shocks. They can not be announced but would split society into big winners and big losers, which (perhaps especially in Iraq that already has enough problems) is a bad thing.

 

so yeah a few people will be a little pissed but if they have the money to spend there obviously not poor and they probably have a lot more.

Probability would say that there will be just as many who lose out (having recently made a purchase) as there will be folks who were about to do so. The amount is all relative. To a poor person 50,000 IQD that turns into $50,000 USD could be a life changer, that they either get or miss.

Edited March 22, 2013 by makecents

[dontlop]

some people wont be satisfied till everyone just throws away the dinar and walks away with a loss .

[The Machine]

Probability would say that there will be just as many who lose out (having recently made a purchase) as there will be folks who were about to do so. The amount is all relative. To a poor person 50,000 IQD that turns into $50,000 USD could be a life changer, that they either get or miss.

 

Wouldn't you say that that would put all the citizens of this country on an even playing field

[dinarbeleiver]

The machine wow man you rock!!!!!!!!!

[Darin]

I don't think anyone would care about the past as they would now be able to afford more for the future.

If it were to truly R/V, us speculators would be mad that it really did happen and we wished we bought more (or for some, didn't sell some of our holding(s))

 

But than again, I am skeptical of any overnight r/v, as I am simply looking for a gradual raising of the currency. Stability in the dinar does exist at the moment, but, the people are still poor and the economy is slowly growing. As the economy grows, the potential for the dinar grows. I would imagine it is best to allow the appreciation of the dinar as it would allow more wealth to the people and possibly increase the demand. 

 

We can get into foreign contracts, but I would argue a lot of contracts are likely done in dollars. Salaries paid in dinar would only be a good thing for the people as it buys more.

It would be interesting to see how people are paid in that country. Government officials are paid in dinars, but who else gets paid in dinars?

[makecents]

Wouldn't you say that that would put all the citizens of this country on an even playing field

As far as the chances of being a winner or loser if a big RV were to occur?  Sure.  That does not mean the losers will be happy about it afterwards.  They didn't enter into such a gamble they would have had it thrust upon them by the government.  Throw in all the sectarian divides already present and I think the result would be catastrophic.

[dontlop]

no one loses anything .. only some people will gain .. who loses something ?

[makecents]

I don't think anyone would care about the past as they would now be able to afford more for the future.

If it were to truly R/V, us speculators would be mad that it really did happen and we wished we bought more (or for some, didn't sell some of our holding(s))

Being pissed off that you didn't invest more is one thing. Having all the cash you could raise go into a downpayment or a car or even a weeks wroth of food, and then realizing that was a fortune is quite another I'd say.

 

We can get into foreign contracts, but I would argue a lot of contracts are likely done in dollars. Salaries paid in dinar would only be a good thing for the people as it buys more.

It would be interesting to see how people are paid in that country. Government officials are paid in dinars, but who else gets paid in dinars?

Any program that is part of a government budget, not just government officials but contracts for building roads or power plants etc would all be in dinars I would think. i.e. most of the budget. I would guess most of the private sector also runs on dinars, but to what extent dollars enter into it I don't know.

no one loses anything .. only some people will gain .. who loses something ?

By "loser" I was referring to the folks who gain little or nothing while the next guy makes a fortune, all due to no actions on their part but only by the government.