The Future of the Iraqi Dinar

[brooke]

Boo....

http://www.wealthdaily.com/articles/the-future-of-the-iraqi-dinar/4424

[hablrob]

Wealth Daily...low end deli meat!

Buy our ideas instead..

[RONIN II]

Read the article, the author is incredibly misinformed and did not do much digging.

[keepmwlknfny]

Read the article, the author is incredibly misinformed and did not do much digging.

How so? He does bring up some valid points......

[Rayzur]

Keep... I would agree that he has some good points given the foundation he sets upon which to make them.... not saying they are wrong or right... this guy is speculating as much as the next guy, given a base of assumptions....

 

He didn't really get the re denomination, decimalization foundation (reasons why) all that correct.... pretty much short cutted, minimized and didn't well explain why a country would do that... However, and most clearly Shabibi said Iraq would eventually decimalize...... and I think for some, the question is, will they decimalize before they re-denominating... shortly before re-demonating or concurrent with re-denominating... there's another question of adding some value before doing that (remember that post to the effect of 1128:1.... that is a slight increase... Would they increase it more and then decimalize.... or will it be a straight up decimalization 1178:1 equaling a neutral event.... (and in that case, you'll recall that Adam said he had VIP arrangements that would cover a neutral event).... 

 

I hadn't heard the debt cx argument so not sure how that would have applied.... I see what he says, but haven't seen that analytically discussed.... so don't know... would have to look at that more (translate after diner at the seafood port/market, when I'm in the mood to think)

 

His point about the flat graph is a non-sequitur... Iraq has been busting a nut to keep it stable (flat).... I see he is using that as a foundation point to make his next point.... which he likewise props up with an economic principle that serves his point.... Again, not saying he is wrong or right.... He is however, using foundations that serve his point (and I can't really tell you if keeping your money value lower is the objective of all countries... it works for China, though it seems to work for China as it servers the complexity of their multi-variate industries (and which is unlike the singular Iraq industry  the author offers) but it seems to server China relative to its complex economic /symbiotic relationship with the US?

 

DontLop has brought in some really great analytical pieces.... would love to see him weigh in on this with some of the research analysis he has been recently providing for us to read.....

 

His good points don't for me override some of the other points that have been offered in contrast, and most certainly don;t mean (to me) they are better points or more viable points.... that part I really don't get from this article.... 

 

Then again, I do have to go eat some fresh oyster, calamari and clams... then my brain will work better 

[keepmwlknfny]

Rayzur,

Why does him not going into full.details on the supposed RD make him incorrect? We know why they want to do that, they have mentioned all the reasons numerous times such as ease of transactions and reducing the money supply. Seems he was being general in all his points and i think.he just assumed that people would look more into it themselves if he at least shed a little light on the subject. There is much confusion on the whole plan to RD because of the countless gurus twisting that information to fit their.happy tales of an impending RV which those two.events are completely different from.eachother. The 1128 rate your speaking if is mostblikely referring to the market rate and not the official rate, they have talked.about taking the dinar to.1000 to 1 which i am most afraid of simply.because ifbthey did thay and dropped the zeros/RD then.it would make.the dinarbexactly 1 to 1 with the dollar and we might break even.after fees and such and thats only if dinar outside the country will be accepted. But there really is a broad.miconception on what the CBIs plans are and its far from a straight revaluation.....

[HOPEFULONE]

I can't claim to be the most knowledgeable person on the Dinar or the Middle East but I have to think the Iraqi people will not want to have a worthless currency where it would take a year's income just to buy a flat-screen TV or a set of tires. Sooner or later they are going to want a decent standard of living and that requires money that is good for something besides wallpaper.They know their country has resources that the rest of the world is going to be willing to pay them for and they are going to want their piece of the pie. Iraq won't be immune to their own "Arab Spring" so their leaders are going to eventually help give it to them and hopefully sooner rather than later.

[sandfly]

THANKS

[MrOptimistic]

Just my 

The majority of the global population is hurting financially as the global population is also growing exponentially.... Most are having difficulties finding jobs and putting food on the table.  How can we better the future by repeating the past? I can't see Iraq flopping it's currency... After all the debt relief given to Iraq and all the international help to get their economy kick started... I'm pretty sure Iraq owe's the world an RV at this point. This is their opportunity to repay those debts and to proclaim to the world that they are a sovereign nation ready to do business. I think we're witnessing a process of monumental proportions on a global scale linked together with Iraq as focal point. There's my   based on my research and observation.

[Trimark]

they have talked.about taking the dinar to.1000 to 1 which i am most afraid of simply.because if they did that and dropped the zeros/RD then.it would make.the dinarbexactly 1 to 1 with the dollar and we might break even.after fees

 

 

 

You could be right, Keep, and it's something I've thought of often but when I play it out this is what I come up with in that scenario:

 

  If they do what you are suggesting then the 30 trillion dinar that they supposedly have outstanding (personally I think they have much less than that) but if we go with that number then those 30 trillion dinar would become 30 billion dinar which at a 1:1 ratio would make their currency valued at $30 billion.  They have said that they have almost $90 billion in reserves.  This would make their currency 100% backed and worth approximately $3.   They could do this but it doesn't give them anywhere to go with their currency.  It doesn't take into account that most countries in the world only back a percentage of their money supply and it doesn't take into account any other assets which are immense that they have to back it up.  

 

  Also, to me it doesn't make sense why they would 'encourage' people in Iraq to use the dollar if they were going to just do a 1000:1, 1:1 conversion.  Why would they spend so much time and energy reducing the dinars in Iraq and making Iraqis think they weren't as good to hold as dollars (assuming of course they have done so a big IF I know but one I feel comfortable with)? 

 

    In most cases where there is money to be made it seems that the little people usually lose.  I see this as a situation with two sets of little people - us and the Iraqi people - and when it comes to whatever is going to happen with the currency we are on two separate sides. 

 

   If Iraq lops, we lose and the people of Iraq win in the sense that their money is worth 3 times what it was the day before.  IMO, though, the country of Iraq loses under this option as they would be locked into a currency range that doesn't take into account any of their natural assets or give their currency room to grow.  They may not want a really low currency rate but it can be just as problematic to have a currency rate that is too high.  By coming out at $3 after a lop which is what they have said they can support now it doesn't give their country the ability to grow over time like they will need.   For example, if you assume that they only back 50% of their currency with hard assets that gives them approximately $4.50 currency value which is one of the if not the highest exchange in the world.  That doesn't even include their oil supply. 

 

  Okay that's one.  They other way is if it RVs in some fashion (ex: .10, $1+, etc.)   We would win but the little people in Iraq (ie., the average Iraqi) would lose initially because they have been 'encouraged' to get rid of dinars that they think are worthless and exchange them for dollars when in fact the dinars they eagerly got rid of turned out to be valuable.   In this scenario even though the people in Iraq lose their country actually wins because it makes their currency more valuable, the Iraqis feel great about that part and it gives the currency room to grow as their economy grows. 

 

 I have no idea what will happen but that's just the way I'm thinking about this small piece of the RV puzzle.   

[umbertino]

Boo....

http://www.wealthdaily.com/articles/the-future-of-the-iraqi-dinar/4424

Thanks for sharing.

[millionaire in training]

Just my 

The majority of the global population is hurting financially as the global population is also growing exponentially.... Most are having difficulties finding jobs and putting food on the table.  How can we better the future by repeating the past? I can't see Iraq flopping it's currency... After all the debt relief given to Iraq and all the international help to get their economy kick started... I'm pretty sure Iraq owe's the world an RV at this point. This is their opportunity to repay those debts and to proclaim to the world that they are a sovereign nation ready to do business. I think we're witnessing a process of monumental proportions on a global scale linked together with Iraq as focal point. There's my   based on my research and observation.

I have to agree with you. This not only involves the people of Iraq but the globe. This has already been planned out to accomplish certain things and we will soon see them all played out.

[NoviceInvestor]

I have to agree with you. This not only involves the people of Iraq but the globe. This has already been planned out to accomplish certain things and we will soon see them all played out.