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SWFloridaGuy Thoughts On Currency Appreciations - 06/01/2013

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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.

You should have refrained from saying "4. Oil is quickly becoming second in Iraq to gold." because a few minutes with google and a calculator show it is NOT POSSIBLE. I have never said anything along the lines of gold not being desirable or valuable or sought by people, industry, investors, and central banks so why you provide this response is rather baffling.

 

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.

Not quite. Immediately after the Bremers were issued the rate doubled from 3000 to 1500 or so. That was very likely due to the CBI not actually knowing how many were out and of their reserves being beefed up by the US (since only a few billion would have made a big difference back then). Then the rate went up and down for a few years till April 2007 where it improved again to around 1250, then crawled for a few years to the current rate reached in 2010 and has been very flat since then.

 

The improvements from 2007 to 2010 were likely due to combatting inflation, which has been under control so we should not see that again. But the economy has been doing better and better over this time, so if anything the IQD shows an anti-correlation with economic growth. In general if you look at other countries you do not see a correlation between a rise or fall of the exchange rate with economic growth or decline, unless the country gets into serious trouble say with hyper inflation. If you google for "exchange rate and economic growth" you will find several papers supporting the idea that an undervalued currency helps economic growth. I don't think the IQD is undervalued, but I see no indication that a rising economy (as Iraq very likely will continue to have) will lead to a rising exchange rate.

 

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.

A "convincing annotation"?? You said quite clearly "3. In the 70s when Iraq's currency held a much higher value GDP only ranged from $2 billion - $8 billion." Leaving out the money supply changes make a comparison of only GDP and exchange rate in the 70s to now not merely meaningless but very misleading.

 

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To clarify.  I don't think it is valid to to point to increasing economic growth and decreasing improvement in the IQD as a causal relationship because we can point to other factors early on that lead to the improvements in the exchange rate having nothing to do with economic growth.  I only say that the reverse, that one can tie economic growth to a rise in the exchange rate is clearly not supported by Iraq, nor other countries.  So the constant posts about good things happening in the Iraqi economy and then at the end claim that this will lead to a rising exchange rate, are clearly bogus.  If you want to take the risk and attempt to profit from Iraq's (likely) rising economy, invest in it directly, not in the dinar.

Edited by skeptic1138
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The Iraqi economy is on the mend, imo. I'm not happy with the GOI at present. I never will be due to the Muslim male dominated cesspool in Iraq, Iran and Syria. Personally, I don't care about Iraq and it's inhabitants. I'm way over the culture in the ME.

 

Iraq will never compare the Qatar, Kuwait, Saudi and others. I would like to make a few bucks off this investment, in the interim I will continue to work my a$$ off without worry of the outcome of IQD. Currency speculation is not an investment to hang your hat on.

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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/

 

 

:twothumbs: .

Looks like, anyone who brings good info abt Iraq, are now pumpers. Even Reuters.

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You should have refrained from saying "4. Oil is quickly becoming second in Iraq to gold." because a few minutes with google and a calculator show it is NOT POSSIBLE. I have never said anything along the lines of gold not being desirable or valuable or sought by people, industry, investors, and central banks so why you provide this response is rather baffling.

 

Not quite. Immediately after the Bremers were issued the rate doubled from 3000 to 1500 or so. That was very likely due to the CBI not actually knowing how many were out and of their reserves being beefed up by the US (since only a few billion would have made a big difference back then). Then the rate went up and down for a few years till April 2007 where it improved again to around 1250, then crawled for a few years to the current rate reached in 2010 and has been very flat since then.

 

The improvements from 2007 to 2010 were likely due to combatting inflation, which has been under control so we should not see that again. But the economy has been doing better and better over this time, so if anything the IQD shows an anti-correlation with economic growth. In general if you look at other countries you do not see a correlation between a rise or fall of the exchange rate with economic growth or decline, unless the country gets into serious trouble say with hyper inflation. If you google for "exchange rate and economic growth" you will find several papers supporting the idea that an undervalued currency helps economic growth. I don't think the IQD is undervalued, but I see no indication that a rising economy (as Iraq very likely will continue to have) will lead to a rising exchange rate.

 

A "convincing annotation"?? You said quite clearly "3. In the 70s when Iraq's currency held a much higher value GDP only ranged from $2 billion - $8 billion." Leaving out the money supply changes make a comparison of only GDP and exchange rate in the 70s to now not merely meaningless but very misleading.

 

 

I would love to continue this conversation but frankly you don't seem to be capable of asseverating your opinions in a civil matter and honestly it's not going to be constructive to this forum if we continue what is clearly something not headed in the direction of a friendly repartee and I don't want to say something I know I'll regret later.  So I wish you the best and you are certainly entitled to your opinion that we will never prosper from this and you are here wasting your time.  So, have a great night Skeptic.

Edited by SWFloridaGuy
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That sounds like a body shot but what the heck....  is it good Wisky?

All good. Hang in there dude. I look forward to reading your post. Don't let some of these guys piss in your wheaties. :peace:

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To clarify.  I don't think it is valid to to point to increasing economic growth and decreasing improvement in the IQD as a causal relationship because we can point to other factors early on that lead to the improvements in the exchange rate having nothing to do with economic growth.  I only say that the reverse, that one can tie economic growth to a rise in the exchange rate is clearly not supported by Iraq, nor other countries.  So the constant posts about good things happening in the Iraqi economy and then at the end claim that this will lead to a rising exchange rate, are clearly bogus.  If you want to take the risk and attempt to profit from Iraq's (likely) rising economy, invest in it directly, not in the dinar.

Have you?  Got a Moms and Pops shop going?

The Iraqi economy is on the mend, imo. I'm not happy with the GOI at present. I never will be due to the Muslim male dominated cesspool in Iraq, Iran and Syria. Personally, I don't care about Iraq and it's inhabitants. I'm way over the culture in the ME.

 

Iraq will never compare the Qatar, Kuwait, Saudi and others. I would like to make a few bucks off this investment, in the interim I will continue to work my a$$ off without worry of the outcome of IQD. Currency speculation is not an investment to hang your hat on.

OKAY!!!  THANKS FOR CHIMING IN!!!

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I would love to continue this conversation but frankly you don't seem to be capable of asseverating your opinions in a civil matter and honestly it's not going to be constructive to this forum if we continue what is clearly something not headed in the direction of a friendly repartee and I don't want to say something I know I'll regret later.  So I wish you the best and you are certainly entitled to your opinion that we will never prosper from this and you are here wasting your time.  So, have a great night Skeptic.

Just what in the response that you were commenting on was uncivil?  I'd really like to know as I thought I was being just factual and polite.

Have you?  Got a Moms and Pops shop going?

Have I invested in Iraqi companies?  No, I think the US markets currently offer excellent returns at low risk. 

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i thought iraq imported 56 tonnes of gold recently .. i read that from reuters .. imported from Turkey and the United Arab Emirates

not mined it ... iraq has around 17 trillion in oil reserves .. and iraq has around 2 billion in gold reserves ..
you can google >>> iraq imports gold and read ..

right now i believe iraq is seeking training on how to extract gold ..

The fast pace of growth in the Turkish gold sector cannot be more evident than through its gold production output over the last 5 years. Production levels leapt almost threefold between 2008 to 2010"Turkey now leads gold production in Europe"where the country produced 17 tonnes of gold from its 4 active gold mines in 2010. Turkey now leads production in Europe and the predicted output will thrust Turkey towards its aspiration of becoming a future global leader in gold.
Currently defined gold reserves stand at 710 tonnes but geological modelling predictions have shown the potential for around 6,500 tonnes. The sector has seen a large influx of foreign investment, often in partnership Turkish and foregin companies are now joining forces to develop new mining operations in the country. Turkey has also continued to encourage and foster growth in its exploration sector, as this ultimately holds the key to Turkey's future prominence as a top gold producing nation.


in turkey ..geological modelling predictions have shown the potential for around 6,500 tonnes

thats alot .. and being next door to turkey iraq may have some gold .. especially up north closer to turkey in the hills ..how much .. who knows ..
http://turkishgoldminersassociation.com/statistics/turkeys-gold-production


The conference was told natural deposits are some of the biggest in the world, including an estimated 600 million tonnes of native sulphur in the Mosul region, 10 billion tonnes of phosphates and 75 million tonnes of quartz sand under the Western Desert, 8 billion tonnes of limestone in Al Anbar and Suleimani, 50 million tonnes of salt in Al Anbar and Al Basrah. All these figures are thought to be conservative.
home003.jpg

  • There's gold under the Western Desert and in Kurdistan where there are also is millions of tonnes of zinc, copper and marble. Iraqi geology is also favourable to the discovery of platinum.

http://www.iraqmining.com/

Edited by dontlop

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in all honesty there is nothing better than a healthy debate ,if we all had the same opinion then we would be no better than sheep and the world would be a boiring place ,that said i have noticed of late the forums seem to have been hijacked by people just wanting to slag others off,

in my opinion swfg expresses intelegent and well thought out articles, and the title of this even suggests its an opinion "SWFloridaGuy Thoughts On Currency Appreciations - 06/01/2013"

 

as for the gold debate there are plenty of articles on the subject most which suggest there are large gold reserves within the country but the iraqi's lack the technology to extract the gold  ,anyway to take earlier advice ,its sunday afternoon here and a long weekend ..beer time

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as for the gold debate there are plenty of articles on the subject most which suggest there are large gold reserves within the country but the iraqi's lack the technology to extract the gold  ,anyway to take earlier advice ,its sunday afternoon here and a long weekend ..beer time

"large" as in say as large as their neighbors?  Sure could be, might not be, might be more.  But as larger or lager than the entire rest of the world combined?  No.

 

Is that not clear?  I really don't get why there is any disagreement here.  Even if Iraq has sufficient gold to eventually become a large producer, say in the top 10 (which I'd say is not remotely in evidence) it would not come close to eclipsing oil.

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i thought iraq imported 56 tonnes of gold recently .. i read that from reuters .. imported from Turkey and the United Arab Emirates

not mined it ... iraq has around 17 trillion in oil reserves .. and iraq has around 2 billion in gold reserves ..

you can google >>> iraq imports gold and read ..

right now i believe iraq is seeking training on how to extract gold ..

The fast pace of growth in the Turkish gold sector cannot be more evident than through its gold production output over the last 5 years. Production levels leapt almost threefold between 2008 to 2010"Turkey now leads gold production in Europe"where the country produced 17 tonnes of gold from its 4 active gold mines in 2010. Turkey now leads production in Europe and the predicted output will thrust Turkey towards its aspiration of becoming a future global leader in gold.

Currently defined gold reserves stand at 710 tonnes but geological modelling predictions have shown the potential for around 6,500 tonnes. The sector has seen a large influx of foreign investment, often in partnership Turkish and foregin companies are now joining forces to develop new mining operations in the country. Turkey has also continued to encourage and foster growth in its exploration sector, as this ultimately holds the key to Turkey's future prominence as a top gold producing nation.

in turkey ..geological modelling predictions have shown the potential for around 6,500 tonnes

thats alot .. and being next door to turkey iraq may have some gold .. especially up north closer to turkey in the hills ..how much .. who knows ..

http://turkishgoldminersassociation.com/statistics/turkeys-gold-production

The conference was told natural deposits are some of the biggest in the world, including an estimated 600 million tonnes of native sulphur in the Mosul region, 10 billion tonnes of phosphates and 75 million tonnes of quartz sand under the Western Desert, 8 billion tonnes of limestone in Al Anbar and Suleimani, 50 million tonnes of salt in Al Anbar and Al Basrah. All these figures are thought to be conservative.

home003.jpg

  • There's gold under the Western Desert and in Kurdistan where there are also is millions of tonnes of zinc, copper and marble. Iraqi geology is also favourable to the discovery of platinum.

http://www.iraqmining.com/

I guess you did not know, Septic says reuters is a pumper.  Can't be trusted.

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I guess you did not know, Septic says reuters is a pumper. Can't be trusted.

Septic? Lol

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Oh did I forget the k?

I'll give you the benefit of the doubt that it was a typo, otherwise I think it would be a violation of posting rules.

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I'll give you the benefit of the doubt that it was a typo, otherwise I think it would be a violation of posting rules.

You know us pumpers kaint spell.

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You know us pumpers kaint spell.

Having been scammed about an RV does not make you a pumper.  You have to consistently make up or knowingly pass on false and misleading information to earn that moniker, at least as I see it.  So if you want the Pumper merit badge Zig, I think you'll have to put a bit more effort into it! :-)

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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? 

he believes in the opposite of anything you say, he is that friend that just runs you down, trying to make him see things in a positive lite. and then you just say good bye!!!!!! and never miss him. Life is short make it good :twocents:

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he believes in the opposite of anything you say, he is that friend that just runs you down, trying to make him see things in a positive lite. and then you just say good bye!!!!!! and never miss him. Life is short make it good :twocents:

You could actually read my response to SWFG's questions instead of making up answers for me.  Just a thought.

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