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SWFloridaGuy Thoughts On Currency Appreciations - 06/01/2013

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1-7-13 Iraq Central Bank Boosts Gold Reserves. 

 

The monthly statistical report of the International Monetary Fund stated that over the three months between August and October of last year, Iraq’s gold holdings quadrupled to 31 tons, the first time something like this has happened in years. The value of gold as a strategic reserve has grown over the past few years due to the continued instability of the U.S. dollar exchange rate.

31 tons of gold is about $1.5B USD worth.  So a nice chunk for sure.  But this says nothing about your previous claim that Iraqi gold production is set to eclipse oil production.  This is just gold that the CBI has purchased, and the value of which is included in their $70B USD worth of reserves.

 

Nor does this address the other things I pointed out (comparing the 70's exchange rate to today's without bringing in the money supply, and claiming economic growth (which clearly is happening) will lead to an exchange rate increase).

Edited by skeptic1138
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31 tons of gold is about $1.5B USD worth.  So a nice chunk for sure.  But this says nothing about your previous claim that Iraqi gold production is set to eclipse oil production.  This is just gold that the CBI has purchased, and the value of which is included in their $70B USD worth of reserves.

 

Nor does this address the other things I pointed out (comparing the 70's exchange rate to today's without bringing in the money supply, and claiming economic growth (which clearly is happening) will lead to an exchange rate increase).

 

You claim I pulled those opinions out of thin air or made them up.  Whether you agree or disagree with any of these reports, they were not written by me.  I simply pass them along.  Yes, it is true that I may read the same article you do and envisage a more positive outlook. That is the nature of speculative investments, human nature and a distinguishing characteristic that makes this forum so interesting.

Edited by SWFloridaGuy
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http://www.iraqmining.com/

Iraq seems to think the gold potential is there among other things.

 

 

According to Iraq’s own data, aside from possessing the world’s second largest crude oil reserves, the country also possesses important gold and diamond reserves. The Iraqi government is thus hopeful that gold mining can be an increasingly profitable venture for the country.

According to officials in Baghdad, Iraq has huge gold producing potential. Nevertheless, senior government members have stated that the country does not have the necessary know-how in terms if mining capabilities. The government could increase gold production in Iraq by granting production licenses to foreign mining companies, but employees of the national banking system do not possess the necessary knowledge about gold trading either.

Now the Banks Association of Turkey has offered to train Iraqi bank employees in order to increase the latter’s knowledge of the gold market. In recent weeks representatives of Turkish private banks have visited Iraq with this venture in mind.

Turkey is one of the region’s largest gold producers. According to experts, Turkey possesses some of the world’s largest gold reserves – up to 23 million troy ounces. While in 2010 only four gold mines were operating in the country, more mines will start operating in the next decade. Not only does Turkey produce gold – approximately 650,000 troy ounces in 2010 – but there is also a thriving gold market in the country.

 

According to Iraq’s own data, aside from possessing the world’s second largest crude oil reserves, the country also possesses important gold and diamond reserves. The Iraqi government is thus hopeful that gold mining can be an increasingly profitable venture for the country.

According to officials in Baghdad, Iraq has huge gold producing potential. Nevertheless, senior government members have stated that the country does not have the necessary know-how in terms if mining capabilities. The government could increase gold production in Iraq by granting production licenses to foreign mining companies, but employees of the national banking system do not possess the necessary knowledge about gold trading either.

Now the Banks Association of Turkey has offered to train Iraqi bank employees in order to increase the latter’s knowledge of the gold market. In recent weeks representatives of Turkish private banks have visited Iraq with this venture in mind.

Turkey is one of the region’s largest gold producers. According to experts, Turkey possesses some of the world’s largest gold reserves – up to 23 million troy ounces. While in 2010 only four gold mines were operating in the country, more mines will start operating in the next decade. Not only does Turkey produce gold – approximately 650,000 troy ounces in 2010 – but there is also a thriving gold market in the country.

http://www.iraq-businessnews.com/tag/gold/

 

 
Edited by zigmeister
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You claim I pulled those opinions out of thin air or made them up.  Whether you agree or disagree with any of these reports, they were not written by me.  I simply pass them along.  Yes, it is true that I may read the same article you do and envisage a more positive outlook. That is the nature of speculative investments, human nature and a distinguishing characteristic that makes this forum so interesting.

NO. that is not what I claimed.  I am not talking about opinions but what you state as facts as well as clearly misleading statements.  You don't credit others for them, nor say anything like "I can't vouch for this but am just passing it on" so I assume at the very least you are endorsing them.  Their origin is not what is in dispute, it is the accuracy of these statements.

 

To summarize, yet again:

* You claim (pass along the claim) that gold exports will soon eclipse Iraq's oil exports and this is clearly IMPOSSIBLE.   You didn't credit any source for this, and if you claim that your expertise is in analysis of economic issues, it took me maybe 5 minutes to totally discredit this idea, yet you pass it along without any analysis at all it seems.

* You go on and on about economic growth, then claim that this will lead to a higher exchange rate.  Clearly a misleading statement as there is no evidence for this and in fact evidence to the contrary.

* You point out the high exchange rate in the 70s with a small GDP and compare that with Iraq's much larger GDP today but fail to even mention that the money supply today is at least 3,000 times larger than back then, maybe 15,000 time larger.

 

In response you post about the CBI adding gold to its reserves.  This sort of attempt at misdirection is just what I would expect from a pumper.

 

http://www.iraqmining.com/

Iraq seems to think the gold potential is there among other things.

 

 

According to Iraq’s own data, aside from possessing the world’s second largest crude oil reserves, the country also possesses important gold and diamond reserves. The Iraqi government is thus hopeful that gold mining can be an increasingly profitable venture for the country.

According to officials in Baghdad, Iraq has huge gold producing potential. Nevertheless, senior government members have stated that the country does not have the necessary know-how in terms if mining capabilities. The government could increase gold production in Iraq by granting production licenses to foreign mining companies, but employees of the national banking system do not possess the necessary knowledge about gold trading either.

Now the Banks Association of Turkey has offered to train Iraqi bank employees in order to increase the latter’s knowledge of the gold market. In recent weeks representatives of Turkish private banks have visited Iraq with this venture in mind.

Turkey is one of the region’s largest gold producers. According to experts, Turkey possesses some of the world’s largest gold reserves – up to 23 million troy ounces. While in 2010 only four gold mines were operating in the country, more mines will start operating in the next decade. Not only does Turkey produce gold – approximately 650,000 troy ounces in 2010 – but there is also a thriving gold market in the country.

First there is no source given for these statements.  But, lets assume Iraq could someday match Turkey's 650,000 oz/year production. At $1,500 USD per oz that is just under $1B USD.  Is that good for Iraq?  Sure!  But its less than 1% of oil exports.  There is not the slightest chance of gold exports eclipsing oil exports.

Edited by skeptic1138
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If you have any proof that SWFG is a "pumper" please provide it. If not you are no better than which you are ranting about!!! Lord you guys(LOPsters) seem to have different set of moral rules and its totally distasteful.

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Skeptic: So, now in addition to calling me a pumper, you're taking statements from articles I present and claim they are pumpers also. I was not the author of that article.

*Thanks Zigmeister*

Edited by SWFloridaGuy
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Skeptic: So, now in addition to calling me a pumper, you're taking statements from articles I present and claim they are pumpers also. I was not the author of that article.

Your post from anther site was brought here.  No where in it was there a claim that you were just reposting others as well.   Whoever originated them, and all those that by passing them along as their own (i.e. without an admonishment along the lines of "take it or leave it, I'm just passing this along"., they are pumpers.  Again you claim you do careful analysis right?  You read 100s of papers you said in the other thread.  But what you said about gold is clearly false if you only spend 5 minutes doing some actual analysis.  If you want to disavow the 3 points that I criticized you for, regardless of their origin, I'll retract my claim.  Otherwise it sticks.

If you have any proof that SWFG is a "pumper" please provide it. If not you are no better than which you are ranting about!!! Lord you guys(LOPsters) seem to have different set of moral rules and its totally distasteful.

As I said to you in your pumper/reverse-pumper post in the other thread.  A pumper is someone who originates or passes on lies and clearly misleading statements to promote a possible big increase in the IQD.  If you go read my first response to SWFGs post (as brought over by someone else) I point out where he clearly has done just that.    What more proof would you want?

Edited by skeptic1138
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That is not what has been reported by other sources.  In fact, the quite opposite has been reported.  I simply look at this as a positive vestige for Iraq in a general sense. Do you disagree with that?

I agree that developing any industry other than oil and gas is a positive thing for Iraq. I disagree that they are now a significant producer of gold. Eveything I read says that they have potential but lack the knowledge or the infrastructure to produce much at this time.

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"Continue drilling operations in the area of luxury Aldajh populated eastern Baghdad after the discovery of the existence of huge quantities of atoms of gold metal in the soil. Was raised thousands of tons of dust, which set aside in order to purification and extraction of gold atoms."

"We did not know the reasons that push to drill here or there but we were surprised during the past two years to begin drilling operations is a natural and extends for several meters deep in the earth except for drilling longitudinal spanning more than ten kilometers, and then to hear from people that the subject matter related to the discovery of gold."

"And Iraq is full of large quantities of petroleum which Aistvid from the Iraqi people which are exported huge quantities of it to global markets and money returns do not prepare for the Allens and countless citizen any of them, while there are other minerals in smaller quantities."

"However, the discovery of gold in the luxury and commercial quantities could turn Iraq into a producer of gold more than oil, and pay the Western countries to re-occupation of as usual through the centuries passed his time, dusty, and is expected to increase the prices of real estate in this neighborhood modest start with the influx of job seekers Gold."

There were about 3 articles all saying the same thing. Actually, it's been a constant progression of news on this topic since last year. I have these quotes all saved in my archives. Gimme a sec and I'll try to find the links. Thanks.

That's the best thing anyone has said in this entire thread. Rock on.

Seems like the articles are saying "could" and you're saying "is". A pretty important distinction. And the articles are wrong anyway, the math done by others in this thread essentially proves it.

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I agree that developing any industry other than oil and gas is a positive thing for Iraq. I disagree that they are now a significant producer of gold. Eveything I read says that they have potential but lack the knowledge or the infrastructure to produce much at this time.

 

You make a good point and really I guess no one can say indubitably how far they have progressed.  However, I do like this quote: "Early in 2012 there was a large discovery of Gold in eastern Baghdad. The last couple years have produced large quantities of gold through their vast drilling operations and have already surpassed the purification and extraction process. This discovery, among others, could turn Iraq into a producer of gold more than oil. It also will increase real estate prices due to the influx of gold job seekers."

Seems like the articles are saying "could" and you're saying "is". A pretty important distinction. And the articles are wrong anyway, the math done by others in this thread essentially proves it.

 

For heavens sake.  Really?   Do I or do I not also say these are just my opinions, which may or may not be correct?  I need some Aspirin, can anyone in the forum hook a brotha up? 

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You make a good point and really I guess no one can say indubitably how far they have progressed.  However, I do like this quote: "Early in 2012 there was a large discovery of Gold in eastern Baghdad. The last couple years have produced large quantities of gold through their vast drilling operations and have already surpassed the purification and extraction process. This discovery, among others, could turn Iraq into a producer of gold more than oil. It also will increase real estate prices due to the influx of gold job seekers."

You like it despite not even (it seems) knowing where it came from?  I have gone over it multiple times.   Simple arithmetic says gold exports surpassing oil CAN NOT HAPPEN.  Yet you continue to ignore that simple analysis in favor of this unattributed quote.  Isn't that exactly what we would expect from a pumper?

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If you have any proof that SWFG is a "pumper" please provide it. If not you are no better than which you are ranting about!!! Lord you guys(LOPsters) seem to have different set of moral rules and its totally distasteful.

He just did. And he's right.

You make a good point and really I guess no one can say indubitably how far they have progressed. However, I do like this quote: "Early in 2012 there was a large discovery of Gold in eastern Baghdad. The last couple years have produced large quantities of gold through their vast drilling operations and have already surpassed the purification and extraction process. This discovery, among others, could turn Iraq into a producer of gold more than oil. It also will increase real estate prices due to the influx of gold job seekers."

For heavens sake. Really? Do I or do I not also say these are just my opinions, which may or may not be correct? I need some Aspirin, can anyone in the forum hook a brotha up?

Yes, really. Saying something could happen is VASTLY different than saying something is happening. It's your opinion that Iraq is soon going to be producing a hundred billion in gold a year? That's not a pumper style statement? Please. For someone that brags about all the research they do it certainly seems that you failed to do any here.

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Permit me to ask you a few questions Skeptic.  What exactly DO you believe?  Do you believe Iraq will one day recovery economically?  Do you believe they will have a strong and valuable currency eventually?  Do you believe there is any way we can profit from this at all? 

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NO. that is not what I claimed.  I am not talking about opinions but what you state as facts as well as clearly misleading statements.  You don't credit others for them, nor say anything like "I can't vouch for this but am just passing it on" so I assume at the very least you are endorsing them.  Their origin is not what is in dispute, it is the accuracy of these statements.

 

To summarize, yet again:

* You claim (pass along the claim) that gold exports will soon eclipse Iraq's oil exports and this is clearly IMPOSSIBLE.   You didn't credit any source for this, and if you claim that your expertise is in analysis of economic issues, it took me maybe 5 minutes to totally discredit this idea, yet you pass it along without any analysis at all it seems.

* You go on and on about economic growth, then claim that this will lead to a higher exchange rate.  Clearly a misleading statement as there is no evidence for this and in fact evidence to the contrary.

* You point out the high exchange rate in the 70s with a small GDP and compare that with Iraq's much larger GDP today but fail to even mention that the money supply today is at least 3,000 times larger than back then, maybe 15,000 time larger.

 

In response you post about the CBI adding gold to its reserves.  This sort of attempt at misdirection is just what I would expect from a pumper.

First there is no source given for these statements.  But, lets assume Iraq could someday match Turkey's 650,000 oz/year production. At $1,500 USD per oz that is just under $1B USD.  Is that good for Iraq?  Sure!  But its less than 1% of oil exports.  There is not the slightest chance of gold exports eclipsing oil exports.

This was their big conference in 2011.  They had quite a few sponsors there, it was held in London's Royal Garden Hotel.  It has their economic plan for mines and minerals up to 2030.  They seem to feel not only gold but other minerals are waiting to be mined.  I don't know how legit this conference can get unless they were actors from a B movie pretending to be at the conference.

 

I don't care if you call me a pumper, did you get your dorrito's today?

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This was their big conference in 2011.  They had quite a few sponsors there, it was held in London's Royal Garden Hotel.  It has their economic plan for mines and minerals up to 2030.  They seem to feel not only gold but other minerals are waiting to be mined.  I don't know how legit this conference can get unless they were actors from a B movie pretending to be at the conference.

 

I don't care if you call me a pumper, did you get your dorrito's today?

 

:twothumbs:

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This was their big conference in 2011.  They had quite a few sponsors there, it was held in London's Royal Garden Hotel.  It has their economic plan for mines and minerals up to 2030.  They seem to feel not only gold but other minerals are waiting to be mined.  I don't know how legit this conference can get unless they were actors from a B movie pretending to be at the conference.

 

I don't care if you call me a pumper, did you get your dorrito's today?

Ok, thanks for the source.  And as I said matching Turkey's output would be good, minerals are good.  But SWFG did not say (or pass on with no analysis or thought) that over the decades gold and other minerals could be generating a few billion dollars of exports for Iraq (which they very well might do) but "4. Oil is quickly becoming second in Iraq to gold."  .  I see a huge differene there.

I don't care if you call me a pumper, did you get your dorrito's today?

I picked up a fresh baguette at the bakery on the way back from the post office this morning, does that count?

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Permit me to ask you a few questions Skeptic.  What exactly DO you believe?  Do you believe Iraq will one day recovery economically?  Do you believe they will have a strong and valuable currency eventually?  Do you believe there is any way we can profit from this at all? 

Sorry, I missed this post.  I believe Iraq is recovering quite nicely NOW.  Their economy growing at 8-9% which is great.  Political instability and sectarian violence are still a problem, but as the economy improves hopefully that will improve as well.  They have a valuable currency right now, as is proven by the economy working.  Again look at South Korea, their economy grew like gang busters for 50 years with an exchange rate much like Iraq's.  Economically what is important is low inflation and a stable rate.  Iraq has both of those.  I also have said that if you want to profit from Iraq's rising economy you have to do it by investing in companies or funds that invest in companies, or maybe an index over their exchange etc, not the currency. Such an investment would be risky, but could pay quite well over time.  Of course right now the US market is paying quite well also.

 

You also said you have answered my questions.  Really, I must have missed that.  Here again are the 3 issues, perhaps you would car to answer each one.

 

 

* You claim (pass along the claim) that gold exports will soon eclipse Iraq's oil exports and this is clearly IMPOSSIBLE.   You didn't credit any source for this, and if you claim that your expertise is in analysis of economic issues, it took me maybe 5 minutes to totally discredit this idea, yet you pass it along without any analysis at all it seems.

* You go on and on about economic growth, then claim that this will lead to a higher exchange rate.  Clearly a misleading statement as there is no evidence for this and in fact evidence to the contrary.

* You point out the high exchange rate in the 70s with a small GDP and compare that with Iraq's much larger GDP today but fail to even mention that the money supply today is at least 3,000 times larger than back then, maybe 15,000 time larger.

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I have had about enough of the "PUMPER" accusations in this thread!  If this continues I will start placing people on mod review! 

 

If you can't discuss these posts like adults then I guess I will have to get my "time out" chair and put some people’s noses in the corner for a while!!

 

Continuing to call someone a pumper and a liar is bashing and subject to being placed on mod review or banned!

 

DinarVets Forum Rules

http://dinarvets.com/forums/index.php?/topic/1114-updated-11232010-dinarvetscom-forum-rules/

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This one line kinda clears it up for me........

" As usual, these are just my opinions, which may or may not be correct. "

 

This is usually how SWFG presents his comments and should be taken as such.

However there are those that relentlessly have a bone to pick with someone on any given day. Its there nature.

So in conclusion we sure do have a abundance of "Dinar Police " ready and waiting to rip your head off and pi$$ down your neck for committing the illusion of pumping ( in thier opinion anyway ) or for any statement that they find fault with.

As it was stated in the piece.....

one more time ......

" As usual, these are just my opinions, which may or may not be correct. "

I'm going to give Mr SWFG a hall pass on this one.

 
And to Skeptic 138 why do you come off so high and mighty? I could careless about the comment about oil being 2nd to gold there are many facets to this picture............
Out of the many times I have read his posts I have never felt like he was pumping  and also I think he has a very grounded opinion.
 

And just for clarification this is also My opinion which may or may not be correct!  

Go ahead fire away boys!!!

:cowboy2:

Quad B)

 


 

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This one line kinda clears it up for me........

" As usual, these are just my opinions, which may or may not be correct. "

 

This is usually how SWFG presents his comments and should be taken as such.

However there are those that relentlessly have a bone to pick with someone on any given day. Its there nature.

So in conclusion we sure do have a abundance of "Dinar Police " ready and waiting to rip your head off and pi$$ down your neck for committing the illusion of pumping ( in thier opinion anyway ) or for any statement that they find fault with.

As it was stated in the piece.....

one more time ......

" As usual, these are just my opinions, which may or may not be correct. "

I'm going to give Mr SWFG a hall pass on this one.

 
And to Skeptic 138 why do you come off so high and mighty? I could careless about the comment about oil being 2nd to gold there are many facets to this picture............

Out of the many times I have read his posts I have never felt like he was pumping  and also I think he has a very grounded opinion.

 

And just for clarification this is also My opinion which may or may not be correct!  

Go ahead fire away boys!!!

:cowboy2:

Quad B)

 

 

I would agree Quad, he has never said this is coming down.  He has always stated he is learning, we have all appreciated his insights.  Right now that is the best one can do.

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Response to Skeptic: First of all, thank you for taking the time to compose a well-thought out response. However, we do seem to be going in circles here but I'll do my best to elaborate on some very labyrinthine topics you raised.

 

1. That is correct (in part) I did pass along a claim backed up by several articles and see no reason why I should have refrained from doing so. Gold is the most valuable thing in the world, the reason being it is not going to lose its value in the near future, and even during inflation, the prices of gold go up.

 

Fiat money often loses its value in the long run. A large amount of USD most likely worth as much a few years from now. On the other hand if you buy gold for $100 it may be around $200 to $300 + 5 to 10 years from now (possibly sooner). This is why nations such as Iraq stock pile gold. Gold is recognized in every country all over the world as legal tender.

 

Gold has a profound impact on the value of world currencies. As a commodity gold can act as a substitute for fiat currencies and be used as an effective hedge against inflation. There is no doubt that gold will continue to play an indispensable role in the foreign exchange markets. It has the unique ability to represent the health of both local and international economies.

 

Gold is a currency, although it is not customarily thought of as one. It can be bought and stored, and while it is not often used as a direct payment method, it is highly liquid and can be converted to cash in almost any currency with relative ease. Also, to add to your first question, I've never heard of solid research being accomplished in 5 minutes.

 

2. Actually, we've been witnessing the IQD appreciate for quite some time now. I agree the rate of growth is fairly picayune but nonetheless it is still improving and according to the Finance Committee and the CBI, it will continue to do so. You said there is in fact evidence to the contrary that the IQD will appreciate. Please provide your evidence that supports an IQD depreciation in inevitable.

 

3. I've said many times I have failed to produce a convincing annotation concerning this issue.  In fact, it is a concern I have myself and have mentioned that 3 or 4 times in former posts.

 

I hope my answers to your questions were adequate because I do appreciate it when someone offers up their own theory rather than just attack others.  Thank you for taking the time to have this discussion with me and hopefully something constructive came out of it.

Edited by SWFloridaGuy
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