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Central Bank announces the withdrawal of 50 dinars a class of trading


yota691
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Sounds to me like they are canceling this denomination.  The same thing they did to the 25 and 100 dinar coin years ago.  They want you to turn it in and recieve the equivalent value in an account or in other larger denoms.  It says they arent used much do to the large price of goods in the market.  In other words the 50 dinar note is less then a penny so we are doing away with it.  Really depressing unless this isnt the entire story.

 

Actually $50 note is roughly .05 cents usd.  

 

These are just rough numbers but fairly close.

$5000 note is about $5 usd 

$500 is about .50 cents usd

$50 is about .05 cents usd

$500 note

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Actually $50 note is roughly .05 cents usd.  

 

These are just rough numbers but fairly close.

$5000 note is about $5 usd 

$500 is about .50 cents usd

$50 is about .05 cents usd

$500 note

Youre right, sorry its about 4 cents.  And Tlar they are giving us time to exchange them, two months.  How is this good? 

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Guys, it says canceling the class of 50 dinar notes.  Yes it is replacing their worth with either digital dinar or larger notes.  It says they are doing this because there is so little value to them they arent needed.  Its either not the whole truth or its not good for near term currency reform where the dinar we hold becomes more valuable.

 

Good point. Ya who really knows what they mean and are doing? Clearly they want to confuse us.

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I believe that they are replacing the "paper" 50 dinar note with a 50 dinar coin. They specifically state "paper category"

The bank said in a statement received by "direction Press", a copy of it, he was "given to stop the public from trading cash paper category 50 dinars, he decided to withdraw this banknote trading ....

Lets assume they remove the 3 zeros from the currency, RV at 1 to 1, the value of this 50 dinar coin would be valued at $.05 Maybe the coin makes since.

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I called this scenario to be played out, somewhat of a "test run" of what's to come and observe on how Iraq and the rest of the world would act ............who else feels the same, really?   I'm just saying.......and I really have a gut feeling.... :shrug:

 

Good or bad, the CBI's really shaking things up just like what Adam said.  Yep.

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I very well could be wrong, but here is what I think may be happening: What are the values of currency that we, as Americans use? 1, 2, 5, 10, 20, 50 and 100.

If they have intent to bring value back to their currency and to issue lower denominations, it makes sense to remove the smallest note they have. That leaves them with notes from 250 and up. By removing the 50, it gives the CBI a clean slate to release a new class of notes (that will likely have a higher value upon release lest they be worth fractions of a penny apiece) without having to worry about these notes still be in circulation. Remember too that these have no security features on them and a new series will.

My hope is that when they do release the lower denoms, they will have a higher value.

For quite some time we have seen CBI statements that the new notes will run side by side with the old (ones we have) for a period of two years.

Again, me speculating, just because these notes will no be valid in Iraq does not necessarily mean that they won't have value to foreign central banks. Then again they may not. When the time comes for the CBI to put new LDs into circulation, they will probably also start withdrawing the large notes, 250 and up, as they are circulated through and back into banks through everyday use. As they are gradually withdrawn from circulation, they will not be replaced by the same face value notes, but by equivalent value of LDs.

If, they assign new value to their currency, and that allows for LDs to be used in everyday transactions, the larger notes will be more difficult to use because it is very hard for a normal person to make change for a 10,000 ( just as it would be for us to use them in this country's).

My thoughts, and a bit of wishful thinking too.

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Article 36 Redemption of currency

1. The CBI may decide to redeem banknotes or coins by issuing, free of charge, other

banknotes or coins in equivalent amounts. A decision to redeem banknotes or coins shall be

issued in the form of a regulation of the CBI specifying the period during which the exchange

shall take place and the locations and times at which withdrawn banknotes or coins shall be

presented for redemption.

2. At the end of the exchange period, or at any other time specified by the CBI, redeemed

banknotes and coins shall be demonetized and cease to be legal tender.

3. The CBI shall notify the public, by publication in the Official Publication, of the banknotes

and coins that are legal tender.

http://www.cbi.iq/documents/CBILAW-EN_f.pdf

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All the articles in the past about the currency replacement or "delete the zeroes" specifically stated the two currencies would run alongside each other for two years. This contradicts that.

If they release a new 50-dinar coin or note that is worth 50 dinars and move the value of the dinar up to $1 per dinar, then they also have to release even lower denominations, which is what we're hoping to see happen.

But if they say that the value of exchange rate is 1:1 for the new notes compared to the same size old ones and the old large denominations aren't honored at face value but instead compared to the value of the dollar at the time (25,000 IQD note being worth roughly $20) then we are totally effed.

This has been the lop position all along. And still isn't 100% debunked. Which makes me worried. Anyone else worried that is what will happen?

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Ok, somebody please tell why the following line of thinking is in error, because this talk of lower denoms about to be made legal tender is beginning to worry me a little.

 

For the sake of this argument, the exchange rate starts at 1000 dinar to the USD, using the notes most of us currently have. Also assume that I could walk into a US bank today and exchange dinar for USD at this 1000:1 rate.

 

So today, I walk in to my local bank of choice with my 1000 dinar note and walk out with 1USD.

 

On March 1st all of these new lower denomination bills are released into circulation. Now, you can't leave the exchange rate at 1000:1. If you are an Iraqi using 1, 5, 10, 50, 100 dinar notes, you need barrels full at 1000:1. So let's say that the rate for these LD notes is 1:1.

 

My buddy in Iraq sends me one of these new 1 dinar notes, exchanging at 1:1.  I go down to my bank and give them the 1 dinar note. Presumably they hand me a 1USD bill. If I also had a 1000 dinar note from the notes that have been in circulation since 2004 or so, would they still give me 1USD, or would they give me 1000USD? Would they keep 2 different exchange rates in effect until all of the 1K, 10K, 25K notes had been turned in, or would the older notes carry the new exchange rate (1:1)?

 

If we're all hoping for the latter, why would banks support that? What, intrinsically supports likely billions of HD notes holding their face value at the new rate when Iraq is expressly moving to the lower denoms? Wouldn't this scenario also make millionaires out of a ton of Iraqis? Just like us, they exclusively possess the HD notes. Will the CBI tell them they have to turn them in for the new LD notes, but let us use the HD notes at face value under the adjusted exchange rate?

 

Given the entire rationale behind this site and the post-rv wealth strategies, I am obviously missing something fundamental. What is it?

 

Please note, I am not trolling or any of that stuff. To say I have a tenuous grip on the subject of international banking is a gross overstatement. I am going off of what I consider to be common sense, but I realize banking and governments and all that often do not make use of common sense.

I doubt thousands of VIPs and OSI folks are wrong, but for the life of me I am having a hard time spotting what I have missed.

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Tex, not sure if you saw my post or not but I essentially outlined the same concern. Everyone has had this exact concern since starting this roller coaster ride.

The lopsters seem to think they will honor two different exchanges meaning low denoms at 1:1 and the old large denoms not at face value instead at the adjusted inflationary rate (1000:1) or whatever it is. Just using rounded values. That would make this a zero sum gain, or value-neutral event like has been stated would happen in the past.

That's why Adam has always been rooting for a float starting off low because an overnight 1:1 is literally almost impossible and has never been done before exactly as we're hoping to see happen.

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Tex, not sure if you saw my post or not but I essentially outlined the same concern. Everyone has had this exact concern since starting this roller coaster ride.

The lopsters seem to think they will honor two different exchanges meaning low denoms at 1:1 and the old large denoms not at face value instead at the adjusted inflationary rate (1000:1) or whatever it is. Just using rounded values. That would make this a zero sum gain, or value-neutral event like has been stated would happen in the past.

That's why Adam has always been rooting for a float starting off low because an overnight 1:1 is literally almost impossible and has never been done before exactly as we're hoping to see happen.

I believe that without a new ISO number for a newly issued currency, both issues will trade at same rate. As long as the CBI does not get a new ISO, we should be safe with our notes. If they get a new ISO, we are probably screwed.

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If they were to drop the "Large Bills" that in my mind would Tick Off a lot of Important Investors

around the world! The Iraqis know very well they need Giant Corporations to rebuild and Invest and

those People probably made an Investment in Iraq after all it was a great way to Change a Dollar in to a Sweet Profit!!!

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From Doc Dinar

2-26-15 R&R: So they sent money to the Kurds, they are expecting to pay salaries next week (which for them starts Sunday, 3/1/15), and at the same time the CBI says it's discontinuing the 50 note and replacing them starting March 1st

Coincidence? I DON'T THINK SO!!! Let's get it done!

If you thought there was a liquidity crunch in Iraq before, there's REALLY going to be one starting on Sunday.

We know almost all of the three zero notes inside Iraq have been pulled from circulation, and at the same time auctions of the USD stopped.

Citizens are making purchases in dinar are doing so with what few notes they have held on to. But take out the 50 and other small notes and how are they supposed to make change and/or do business?

This process is coming to an end .... FAST!

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