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Delete the zeroes of the Iraqi currency

carlablum

By carlablum,
in LOPster tank

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carlablum Newbie

carlablum

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Expert: Delete the zeroes of the Iraqi currency will positively affect the economy

2010-05-10 15:20

Iraqi bank expert said that the process of deleting three zeros from the Iraqi currency will affect a positive factor "to the Iraqi economy to Tahedvh of an amendment to the conditions of the Iraqi currency factor" in general.

The aim for Hassoun said in a statement released by the independent press that countries taken the same action, including Ankara's omitted six zeros off its currency, right Iraqi adjusted rate of exchange in this way, especially since there is a difference large numbers no longer reflects the value of local production of Iraq.

"If it adjusts the exchange rate factor" decent matter meaningful as a whole, especially as select mechanisms and plans for the replacement of banknotes another part of the new value and duration of appropriate permits everyone to replace their bank notes, adding that the effectiveness of the operation will be of positive support of the Iraqi economy through a plan in promote the exchange rate of the Iraqi currency.

http://translate.googleusercontent.com/translate_c?hl=en&sl=ar&u=http://www.aljewar.org/news-24366.aspx&prev=/search%3Fq%3Dwww.nahrain.com%26hl%3Den%26sa%3DG&rurl=translate.google.com&usg=ALkJrhicXOpnVz49wrkiL0tntG34LgIJ9g

This should have been in news.

Sorry I goofed!

Blessings

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carlablum Newbie

carlablum

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So dumb question but if this were to happen, would it apply also to Dinar held in accounts??? Say you have 500,000 in Warka, would it becaume 500???? Why or Why not?

Thanks!

I was thinking the same thing. That would sure upset alot of people. Why does't this make sense to me.

Who knows!

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RAL Newbie

RAL

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Posted

Expert: Delete the zeroes of the Iraqi currency will positively affect the economy

2010-05-10 15:20

Iraqi bank expert said that the process of deleting three zeros from the Iraqi currency will affect a positive factor "to the Iraqi economy to Tahedvh of an amendment to the conditions of the Iraqi currency factor" in general.

The aim for Hassoun said in a statement released by the independent press that countries taken the same action, including Ankara's omitted six zeros off its currency, right Iraqi adjusted rate of exchange in this way, especially since there is a difference large numbers no longer reflects the value of local production of Iraq.

"If it adjusts the exchange rate factor" decent matter meaningful as a whole, especially as select mechanisms and plans for the replacement of banknotes another part of the new value and duration of appropriate permits everyone to replace their bank notes, adding that the effectiveness of the operation will be of positive support of the Iraqi economy through a plan in promote the exchange rate of the Iraqi currency.

http://translate.googleusercontent.com/translate_c?hl=en&sl=ar&u=http://www.aljewar.org/news-24366.aspx&prev=/search%3Fq%3Dwww.nahrain.com%26hl%3Den%26sa%3DG&rurl=translate.google.com&usg=ALkJrhicXOpnVz49wrkiL0tntG34LgIJ9g

As per article posted on DinarVets yesterday (from memory) - this just slightly expands the argument.

It's interesting that this article - by different people and in different formats - keeps making a regular appearance in the Iraqi media - and they all refer to Turkey's use of shifting the decimal point in their re-valuation (dropping six zeros).

The dropping of three zeros relates to "the currency" - not the notes.

The currency, to my mind relates to THE VALUE of the currency, not its numerical value, but its comparative value to its anchor-point, the US dollar.

We have been already placed on notice that they will chop three zeros off the high demonination notes as of the end of this year, but that's of no consequence regarding the reval.

The "dropping three zeros" will have the secondary effect of also discourage any further late IQD sales as well.

1 USD = 1,170 IQD (Giving the same rate as per hyperinflation - but no major inflation pressures currently exist - decreased value was due to effect of WAR on the economy)

Drop three zeros (shift decimal point three positions to the left)

we have 1 USD = 1.170 IQD.

Therefore 1 IQD = 0.86 USD

To my mind I believe that this is what they are telling us ...... ?????

If the same thing does happen IT WILL PAY TO HOLD SOME CURRENCY FOR AS LONG AS POSSIBLE because IQD has far greater potential for growth than did the Lira!

It's my prediction that once floated the value will grow over the next three years to significantly more than the initial float value - provided of course that they can sort out their inherent mistrust of each other ......

This is the way Turky's currency went - note the dropping of value over the ensuing three years !!!!!!!!

Turkish Currency

From an average of 9 lira per U.S. dollar in the late 1960s, the currency came to trade at approximately 1.65 million lira per U.S. dollar in late 2001. This represented an average inflation of more than 40% per year.

1966 — 1 U.S. dollar = 9 lira

1980 — 1 U.S. dollar = 90 lira

1988 — 1 U.S. dollar = 1,300 lira

1995 — 1 U.S. dollar = 45,000 lira

1996 — 1 U.S. dollar = 107,000 lira

2001 — 1 U.S. dollar = 1,650,000 lira

2004 — 1 U.S. dollar = 1,350,000 lira

REVALUATION

2007 — 1 U.S. dollar = 1.26 new lira (The use of New Turkish Lira, which drops 6 zeros from the currency-Turkish Lira-, is implemented in 2005. Turkish Lira and New Turkish Lira were used together in 2005. After 2009, New Lira was converted to Lira, but New Lira used as currency until 31 December 2009) 2008 — 1 U.S. dollar = 1.55 Lira

2009 — 1 U.S. dollar = 1.48 Lira

2010 — 1 U.S. dollar = 1.49 Lira (Last updated on April 17th, 2010)

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RAL Newbie

RAL

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I wish we could get past the lop conversation it is really getting old . Maybe we should put a disclaimer we new people sign up to please read up on the lop theory of past posts before posting on the lop.

Firstly, I have read (I think) all - or at least most - that there is to read about the LOP on DinarVets. But please tell me if I am wrong to assume that all of the "evidence" against it consists of people's opinions.

As we are presented with actual news materials from Iraq which discuss the ACTUAL process does this not suggest that such material should be considered?

What part of the above is so offensive?

It would mean that we would have an RV of around $0.86 USD (or more) which represents a very healthy profit.

It was my understanding that "LOP" referred to the conversion of 25,000 IQD note to 25 IQD notes - something which is not being considered in the above articles.

If we take as more likely the statement that this would be done by the end of 2010 - and we assume that RV takes place sometime before then, then (a) we assume that all large demonation notes would have already be cashed in, (B) the value of the IQD would be whatever it would be, and © there has some been evidence presented that suggests the LOP could occur "behind the scenes" at Bank level and would not effect the face values of the notes. .

Please, I am at a loss as to why there is such resentment by some to such an idea - and an idea is all that it is.

I'm a scientist, not an economist, but simple common-sense would suggest that a possibly legitimate argument should not be rejected simply because it disturbs the reader.

Hopefully anyway all of this is just pur speculation and the real RV, if and when it comes, will be one for which we all be grateful and will be means and mechanism to change all our lives.

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luckylucy Newbie

luckylucy

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Why do we think the speculation regarding "removing three zeros" means that, for example, ONE 25,000 dinar note would be exchanged for ONE 25 dinar note .... from all I've read, with the redenomination that is meant to make the currency more usable AND not devalue their currency, the exchange of ONE 25,000 dinar note would be for 1,000 25 dinar notes (multiples; I'm not sure why it wouldn't be an even exchange, but I don't really know and I welcome someone's clarification on this). This seems to be separate from actually changing the value of the currency or the exchange rate.

We get hung up on the terminology of the Arabic language as well as cultural differences, IMO. This would be like us saying, "I'll exchange your hundred for ones" and someone thinking they'll get ONE $1.00 bill for their ONE $100 bill. Pretty much every American and anyone who understands and deals with US currency would understand they would get the same amount of money, just in a small denomination. Unlike what we think Iraq is about to do, the value of the money, in this US example, whether in one large bill or 100 smaller ones doesn't change. The person who has the money is not harmed in the exchange of bills.

Have you ever stopped at a gas station late at night, with only a One Hundred Dollar Bill and no credit card ... and they don't take large bills? Remember the original pump-your-own gas stations that took only ONE DOLLAR BILLS. People everywhere have to have currency that is more usable and spendable.

Why would Iraq deliberately do anything to devalue their currency world-wide and/or decrease the spending power of their citizens. I seriously doubt that they will adjust their currency exchange or denominations to please dinar investors, but does it really matter. If they do what is best for their country, won't we investors benefit as well.

Maybe we should stop getting so hung up on inaccurate translations and our American understanding of the terminology and watch the market indicators. What exactly are they going to do and when ... no one knows; but as in all investments, our dinar investment is about speculation and understanding your market.... finding good sources of information and hoping you've made the right decision. When do you buy and when do you sell. We are all here seeking answers to just that, though we are at different points in this journey. So, please, let's not degrade someone for asking questions or sharing their opinions. At the moment, we are all just hoping for and wanting a good outcome, ie, a profit.

I'm sure I'm going to get slammed all over the place for posting this. I welcome any comments that are meant to be helpful and educational.

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Bob_Loblaw Newbie

Bob_Loblaw

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Posted (edited)

Why do we think the speculation regarding "removing three zeros" means that, for example, ONE 25,000 dinar note would be exchanged for ONE 25 dinar note .... from all I've read, with the redenomination that is meant to make the currency more usable AND not devalue their currency, the exchange of ONE 25,000 dinar note would be for 1,000 25 dinar notes (multiples; I'm not sure why it wouldn't be an even exchange, but I don't really know and I welcome someone's clarification on this). This seems to be separate from actually changing the value of the currency or the exchange rate.

We get hung up on the terminology of the Arabic language as well as cultural differences, IMO. This would be like us saying, "I'll exchange your hundred for ones" and someone thinking they'll get ONE $1.00 bill for their ONE $100 bill. Pretty much every American and anyone who understands and deals with US currency would understand they would get the same amount of money, just in a small denomination. Unlike what we think Iraq is about to do, the value of the money, in this US example, whether in one large bill or 100 smaller ones doesn't change. The person who has the money is not harmed in the exchange of bills........

I talked with luckylucy about this and I completely agree. "I believe what we have here is a failure to communicate." - Cool Hand Luke. There seems to be great negativity surrounding the topic of anything that might suggest a l o p. As has been argued relentlessly here on this site (and elsewhere), a l o p would serve very little purpose to the Iraqi economy, particularly when it comes to their import economy, internal market trade, and the purchasing power of the people. All of those are necessary to prevent inflation issues when oil production/export ramps up and, inevitably, the GDP rises. Now since a l o p wouldn't make any sense, whatever could this article be insinuating? I think it is exactly what luckylucy touched upon. This would not act as a l o p in the literal sense (kind of a joke, get it?), but more of a de-circulation of large notes to ease internal market trade to help encourage spending with smaller bills. Some have referred to this as a "soft l o p".

When an RV hits the country, which it needs to for numerous reasons, there will be plenty of people with large notes that could be dangerous to carry around and have limited practical use when it comes to internal market trade because of the complications of making change. It seems logical to de-circulate the large notes in trade for small denominations to ease transactions and encourage open trade, and spending. Another benefit and logical reason for such a de-circulation of the large notes is that the country has made strong moves towards supporting an electronic economy, much like what we have in the US today. When large purchases are to be made, the banks of Iraq want them to be done with checks, wires, and credit/debit cards. What this also aids in is reducing the incidences of large counterfeit transactions and fraudulent purchasing. With the large notes de-circulated, large purchases will be made with electronic funds and small trades (i.e. - grocery shopping) will be done with smaller bills. This is certainly by design and has been the plan since they made the move to electronic funding.

Another example to support this "soft l o p" or de-circulation, which relates to luckylucy's examples and ideas, is how the US has acted in the past. In the late 60's, the Federal Reserve Bank begun the de-circulation of large note bills such as the $1,000 bill. The $1,000 bill did not become the equivalent to a $100 or $10 bill, but was exchanged for smaller denominations and taken out of circulation. The value and overall number of dollars remained the same before and after the transaction. This is what may and seems likely to happen in Iraq for the reasons stated above.

All in all, I agree with luckylucy's assessment of this "news" that there will not be a l o p where 25,000 IQD = 25 IQD, but rather a de-circulation where change is made for the larger bills, thusly totaling the same amount of IQD. There may or may not be a time limit for exchanging the bills. There would need to be if they want the security benefit of less/no large notes circulating, leading to the decreased value in black market counterfeiting.

Ty lucy for bringing this up too. The consensus that this is a l o p is most likely a misinterpretation.....RV please!!!!

Edited by Bob_Loblaw
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klee Newbie

klee

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I wish we could get past the lop conversation it is really getting old . Maybe we should put a disclaimer we new people sign up to please read up on the lop theory of past posts before posting on the lop.

We have to remember that some peeps are new to this and need the info. JMO

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Puff Newbie

Puff

Posted
Posted

Expert: Delete the zeroes of the Iraqi currency will positively affect the economy

2010-05-10 15:20

Iraqi bank expert said that the process of deleting three zeros from the Iraqi currency will affect a positive factor "to the Iraqi economy to Tahedvh of an amendment to the conditions of the Iraqi currency factor" in general.

The aim for Hassoun said in a statement released by the independent press that countries taken the same action, including Ankara's omitted six zeros off its currency, right Iraqi adjusted rate of exchange in this way, especially since there is a difference large numbers no longer reflects the value of local production of Iraq.

"If it adjusts the exchange rate factor" decent matter meaningful as a whole, especially as select mechanisms and plans for the replacement of banknotes another part of the new value and duration of appropriate permits everyone to replace their bank notes, adding that the effectiveness of the operation will be of positive support of the Iraqi economy through a plan in promote the exchange rate of the Iraqi currency.

http://translate.goo...iL0tntG34LgIJ9g

This should have been in news.

Sorry I goofed!

Blessings

From XE: The Central Bank of Iraq has announced their plans to redenominate the Iraqi Dinar to ease cash transactions. By the end of 2010, they intend to drop three zeros from the nominal value of bank notes. It should be noted that the actual value of the dinar will remain unchanged. That means that 1,000 IQD (pre-redenomination) and 1 dinar (post-redenomination) will both be worth the same amount in US Dollars. As stated by the Central Bank of Iraq, their mandate is to "ensure domestic price stability and foster a stable competitive market based financial system." For more information about the redenomination, read "Iraq plans to slice three zeros off currency notes."

Please tell how the actual value can remaine the same and also a $1000.00IDQ pre-redenomiantion and 1 dinar post-redenomination will both be worth the same amount in US Dollars???????

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Puff Newbie

Puff

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Posted

The Central Bank of Iraq has announced their plans to redenominate the Iraqi Dinar to ease cash transactions. By the end of 2010, they intend to drop three zeros from the nominal value of bank notes. It should be noted that the actual value of the dinar will remain unchanged. That means that 1,000 IQD (pre-redenomination) and 1 dinar (post-redenomination) will both be worth the same amount in US Dollars. As stated by the Central Bank of Iraq, their mandate is to "ensure domestic price stability and foster a stable competitive market based financial system." For more information about the redenomination, read "Iraq plans to slice three zeros off currency notes."

It should be noted that the actual value of the dinar will remain unchanged. That means that 1,000 IQD (pre-redenomination) and 1 dinar (post-redenomination) will both be worth the same amount in US Dollars.

Can anyone tell me how the value will remain the same and 1000.00IDQ per-re denominational and 1 dinar post-re denomination will both be worth the same in US Dollars????

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willie Newbie

willie

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Please do some searching here before posting this has been debunked on here 1,000+ times if you woud look before posting this please search and it could have been easily explained in one of 100's of articles.

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tampa1000 Newbie

tampa1000

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The Bank Of Iraq will put out miss information to lead you into thinking there is no need to buy Dinars to make a profit on an RV/RI, If they said it would increase in value people would be buying trillions of Dinars and an RV or RI would not be posible! Its just my thought!

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tommy17 Newbie

tommy17

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Please do some searching here before posting this has been debunked on here 1,000+ times if you woud look before posting this please search and it could have been easily explained in one of 100's of articles.

I'am behind you on that one willie.

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