The Sterling Currency Group Indictment

[rockfl9]

 

:-)  If you think that, then please answer my question a few posts back, when Iraqis go to buy more imports with their new found wealth where will those dollars come from?  These are exchanges INSIDE Iraq.

 

You might be right If no exchanges other for imports are allowed (as they try to do now) AND only the current level USD of imports are allowed (and that would include ALL imports, so parts and services etc).  So it would really be yes the exchange rate is higher but no you can't actually spend any of it.  So why bother?   It would also likely generate a huge black market from people trying to get around such controls.  That would effectively be a redenoination, but much more complicated so again why do it?  A LOP does the same thing and is clean and easy.

 

To perhaps make it more clear, I'd restate that as "the MOF/CBI can set the exchange rate at any value they can support".   Exchanges for imports are the big problem.

 

EC ALL dollars generally] will come from  oil sales, But only paid out for what ever the cbi says are essentials . You are right if the RV is 1:1 and the cbi says you cant import that they will try to get around that. They wi;ll have to make it a serious crime.

 

The point i am making is that if I am right Dinarians are SCREEWED!  Before I get stomped on by Markinsa et al , I have no proof  just my creative mind.

 

 

 

[EverCurious452]

Having an exchange rate that is only a "show" rate would be pointless.  There is a reason that (as far as I can tell) the central banks of counties with pegged currencies all keep reserves sufficient to exchange the entire money supply.  If you don't the rules and regulations you need to keep the bank solvent (i.e. not run out of reserves) are a nightmare and very hard to enforce, so what's the point?  Plus of course a huge RV has all sorts of negative consequences for any sort of contract or loan expressed in IQD so lots of negatives and no positives.  They might as well LOP, or just keep the rate and currency as it is.  With the notion of introducing 50K and 100K notes, I suspect they are going for option 2 and it will just stay as is for quite a while.

Edited September 14, 2015 by EverCurious452

[easyrider]

Adam how are you? what happens when we switch to the SDr basket and go to a  more asset backed basket of currencies  instead of the failing fiat funny money system based on debt? i think many are missing the bigger picture is that the current system, simply cannot sustain itself any longer the jig is up and we are in the beginning process of ushering in a new one, out with the old in with the new.

[RVPleaseToday]

An asset backed system is a fantasy. The world is way beyond any ability to generate enough wealth based on some kind of hard asset. The U.S. will never run out of money because it is a sovereign country and can create all the money it wants to. It's the same reason that the U.S. can never go broke. If a country, say China, decided that U.S. dollars were worthless and they were no longer going to trade with us, their economy would crash and burn. So, they aren't going to do such a thing. All economies are connected now.

 

This is not the 1700's. 

[Texstorm]

RV you have it right ! The U.S. Dollar is here to stay !

[caz1104]

Thank you AM & Markinusa for your input! I agree 100% with both of your assessments in regards to why some are here.

[SocalDinar]

Not sure what will be the trigger but at some point the Feds Ponzi scheme will fail. Maybe an auction goes bad and some large hedge funds say I'm out. The dollars value drops and the panic spreads as wealth disappears and hyper inflation goes out of control. When it does happen we will see panic with people wanting to buy tangible goods with their USDs that are devaluing fast. They will try to pull their dollars from the banks, but their dollars really don't exist so the Fed will print more and they will actually devalue before being printed. Our way of life will change forever.

How's that for gloom and doom ?

[caz1104]

Consistant within the LOPster guidelines. Quite frankly I would be surprised (Elizabeth, i'm comin to join ya) if anything else was posted here in Da Tank.

[EverCurious452]

Not sure what will be the trigger but at some point the Feds Ponzi scheme will fail. Maybe an auction goes bad and some large hedge funds say I'm out. The dollars value drops and the panic spreads as wealth disappears and hyper inflation goes out of control. When it does happen we will see panic with people wanting to buy tangible goods with their USDs that are devaluing fast. They will try to pull their dollars from the banks, but their dollars really don't exist so the Fed will print more and they will actually devalue before being printed. Our way of life will change forever.

How's that for gloom and doom ?

I don't think so.  The rate will simply go up (via the normal mechanism) until the bonds are sold.  Its possible (i.e. this isn't a technical issue but just a political one, not saying that makes it easy) we will get our borrowing habits under control and start to bring down the debt.  Likewise we can solve our unfunded liability issues, in fact it isn't that hard technicalyl, we just need the will to do it.  Not sure that will happen of course.  In any case a sudden drop seems very unlikely.  There are too many players around the world that do not want to see this.  It will just get more and more inflated and become worth less and less, but slowly.

[rockfl9]

.  They might as well LOP, or just keep the rate and currency as it is.  With the notion of introducing 50K and 100K notes, I suspect they are going for option 2 and it will just stay as is for quite a while.

I agree.

Although revenue neutral a LOP introduces uncertainty. The new GOI doesnt need that now.

[SocalDinar]

I don't think so.  The rate will simply go up (via the normal mechanism) until the bonds are sold.  Its possible (i.e. this isn't a technical issue but just a political one, not saying that makes it easy) we will get our borrowing habits under control and start to bring down the debt.  Likewise we can solve our unfunded liability issues, in fact it isn't that hard technicalyl, we just need the will to do it.  Not sure that will happen of course.  In any case a sudden drop seems very unlikely.  There are too many players around the world that do not want to see this.  It will just get more and more inflated and become worth less and less, but slowly.

 

You are an optimist.EC for sure

If there was only 1 dollar in existence and you borrowed that dollar but had to pay it back with interest what would you do?. The dollar will fail eventually with out a doubt. Just like every other fiat currency in history including seashells. 

President Nixon put that nail in the coffin

 

Precious metals will always have value. Gold is money!  Currency is not money It is only paper forced upon you to use by government

Edited September 17, 2015 by SocalDinar