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Adam Montana

Adam Montana 14 November 2018

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Morning all!

 

It's been a pretty interesting morning over here at DV headquarters, and there are a couple things I'd love to get your feedback on. 

 

In fact, today's update is more of an invitation to discuss than anything else. There are some brilliant people in this community, and even if you're not one of them, please get involved! 

 

There are going to be mentions of some stocks below, and these are not items that do or do not invest in (short/long/otherwise), but they play a role in the bigger picture and can be thought provoking, which lends insight to the future if you care to follow along.

 

One of these items is (of course) the immediate future of the Iraqi Dinar.

 

As the year draws to a close, there is a question of "Will this get done before the end of 2018 or is there a benefit to waiting until the start of 2019? Post your thoughts below on why they may want to pull the trigger before year end, or why they would be better served to wait till January 1 or after?

 

NOTE: If you are going to respond with nonsense like "We deserve an RV for Christmas" or "I don't think it will ever happen because I was bullied in school and it's scary outside of my crying closet", please just move on. Those are not legitimate or intelligent thoughts. Thanks :)

 

Next, and related, is US economy and oil prices in specific. Yesterday WTI posted it's lowest price of the year at 56.55, OPEC has been flirting with production cuts (which makes sense), and President Trump encouraged the opposite (not sure why yet). The DOW has taken a beating lately, but is up over 150 as I type this.

 

 

 

A couple of very interesting topics recently have been Tesla (TSLA) and Amazon (AMZN). Tesla is fun to watch if for nothing more than the fact that Elon Musk is a wild child and does whatever the hell he wants, by all traditional measures the company simply shouldn't even be in business, yet.. :lol: 

 

 

 

And Amazon is fun to watch because... who or what is going to stop THAT train? 

 

Final topic of discussion for the morning, and the "meat" will be in the VIP section, but let's throw this out there anyway... crypto.

 

Last year there was a selloff, causing a dip, before Christmas. BTC has been extremely stable for some time now, but are we heading towards another dip? I'm about 3 weeks early on this particular dip, if it's going to happen again, so this is the perfect time to prepare. 

 

Full discussion on that in the VIP section:

 

 

 

I have lots more on my mind right now, but I think those three(+) items will make a good starting point. Let the discussion begin!

 

Weekly Q's:

 

On 11/10/2018 at 2:59 PM, Chartman17 said:

Dear Adam, I need a clarification in regards to the HCL.  This morning I read that the PM is working out payments to Iraqi citizens with regard to the

 

 

On 11/10/2018 at 3:04 PM, Chartman17 said:

If it has, I missed the memo.  As I recall, Adam said when the HCL goes so goes the Dinar.  Any comments?  Sorry for the multiple posts, my "enter"
 key is on steroids.  All the best.

Chartman 17

 

Don't worry about the multiple posts bud :lol: it happens!

 

Regarding HCL - you have to give me a link if you want a response to a specific article. We do not currently have a completed HCL.

 

On 11/12/2018 at 12:17 PM, ezrapound said:

So Adam...first off, thanks for the reinstatement of my posting privileges.  Secondly, after being in this endeavor now for about 14 years, I am sure you can understand the word frustration. Do you think perhaps this year...by end of year our adventure may come to fruition? I knw it isn't your style to predict, but surely you can throw a bone or two out there for this question?

 

This topic is now open for discussion, as I posted above.

 

:tiphat:

 

 

 

 

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With all the post about giving money to the Iraqis from the sale of oil and the constant discussion about revising the 2019 budget, I believe it will be January 2019.    i would like to see the currency auctions stop and the some news in December about lower denominations.  That would be a dead give away.  Until then we wait patiently.  

Edited by cranman
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I don’t think now or the beginning of 2019 makes any difference! It appears the banks are ready. What is important for the Iraqi people is to get it done. To do that they need to wrap up taking care of the corruption and counterfeiting > pass the HCL > get the lower denominations out > & then start the float!

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Great topics, Adam. As for my thoughts on an RV, my right side brain (the part that tells my wife that SALE is a dirty 4-letter word) can't help but logically point to something happening after January 1st. I mean, there's no sense in doing this before a clear 2019 budget is passed for Iraq and Mahdi has all his COM ducks in a row. If you are making a whole sale change to your currency, value, marketing, contracts etc. why not start with a new year, clean slate. They still have a clean-up on aisle 3 (auctions) to contend with too. JMHO.

                                                                          :twothumbs:  +:moneybag: =  :D

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Thank you again Adam for all you are doing.  You pose some interesting questions.

 

As to the timing of an RV I think it depends a lot on tax status.  If we participate in OSI and use other tax deferred options there is less of an impact if an RV were to take place this year.  If one were to take profits right away then having the RV after the first of the year postpones paying taxes until 2020 instead of 2019.  With a now divided Congress it’s hard to speculate on what changes there may be in tax law by 2020.

 

As I’m typing the markets are up a little but there is no rally going on.  The price of oil has multiple effects.  Higher prices hit the consumer with higher prices of gasoline and heating oil.  Typically higher prices help the oil companies and the investors who own their stock or are long in the market.  Maybe Trump is playing to consumer interests.

 

I follow AMZN but haven’t been trading it.  TSLA has been a wild card but a speculator’s dream this last year.  It’s IVR (Implied Volatility Rank) (see TastyWorks website) has been high and selling strangles have worked very well.

 

With regard to crypto currencies I think it’s going to be a wild ride before it settles out.  I see the Bank of China may be planning to create its own.  Unless and until there are only one or two widely used crypto-currencies or a great system is developed for transferring from one to the other I don’t see them becoming the main financial system in the near future.

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Thank you Adam...thinking upon your questions and will get back later...Have an amazing day!!!

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If they pass the HCL in full this session which they say is one of their priorities and seat the rest of the ministers which should also be a priority then I believe we will see the RV. The only caveat to this is that we have seen "HCL" and "this session" multiple times with nothing being done.

If that pattern continues look to 2019.

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Thanks Adam for the update.  Much I would like to have RV this year I do not think that will happen.  My reason are the HCL have not been completed and I believe the CBI will not RV until there is completed HCL.  How long that will take is anyone's guest..Hope Iraq can get that completed in 2019 for HCL.  Another is the lower demons and fully seated and committed GOI on passing the important laws for Iraq.  Just my :twocents:

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Many folks talk about needing to educate the people before this will happen, but I would hope that that has been going on for the last couple/few years. Slowly letting the citizens know what is to come, how it's going to change their lives, and how they will be competing in the world, and doing commerce as the world does. Why would they wait til they're ready to pull the trigger? Crash courses wouldn't be prudent.

 

I hope they are ready to go, just finish up the HCL so everybody in Iraq can benefit, like the Kuwaitis do, and so on, get GOI in place, aaaaaaand GO!! I have a feeling they will wait for the new year? Who knows?

 

Crypto has been around for a long time, App pays, Frequent Flier Miles and such are all cryptos so it's really not just finances, it's also technologies, so I don't see it going away. I see it growing and being more and more widely used. Probably one or 2 main 'currencies' will be BTC or Etherium or whatever, but I feel there will be many other 'crypto's' for emerging technologies that will continue being developed with blockchain and others. There will DEFINITELY be a shake out of smaller and more useless cryptos, as in anything, but it's not going anywhere, IMO.

 

Let's get this RV/RI whatever, going!!!! I've got some investing to do!!! :rodeo:

 

Thanks Adam!! Looking forward to meeting everyone soon - hopefully! I mean we GOTTA throw a BIG OL DV BASH somewhere in the world once this happens!! Would love to meet my fellow DV'ers!!!

 

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23 minutes ago, watchmedude said:

Adam you said we don't have a comp;eted HCL ,do we have a partial HCL?Thanks Adam.

Supposedly 2 out of 3 of the HCL parts have been passed. 

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Interesting chat. Great questions and especially with where the economy here in the US currently appears to be heading. Texas is drilling more oil than ever before. Therefore, it is hard to believe the cost per barrel will fluctuate up much. However, while the budget is based a great deal on the oil in Iraq there are other factors, such as gold and farming, that can stabilize the budget, IMO. Will they RV before the end of the year, I think a great deal would depend on the 2018 budget being finalized and the 2019 budget issues addressed. It COULD happen if they put the peddle to the medal, but will they? Time will tell. This late in the year and the way things happen in Iraq I feel we are looking after the first of the year. But it would be sweet if they surprised us all.

 

Amazon keeps trucking forward, Tesla is in a game all its own.

Import taxes on items we have been use to having available to us at a lesser amount will cause people here in the states to have to adapt. But that's what we do.  

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I  hate to compare Iraq to other countries like Haiti or other impoverished countries, but governments are governments just the same, What I am getting at is that when a country like Haiti are receiving billions from Aid- giving countries to help those peoples, the Government takes these monies and never distributing to the needy, thus keeping the country impoverished and the officials get richer. I have felt that Iraq has become somewhat of a Haiti with the aid given them by aid giving countries like USA, China, Russia, etc. , I fear that the government of Iraq may not want to have Iraq become successful and lose their cash cow. Please tell me that my thinking is wrong and there ARE  some honest officials in the GOI and actually want to help their people....... I wish that we had some of those kind of government people here in the US of A.  Your opinion ????

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Due to a load of problems in Iraq with the government I don't believe the CBI will act on the RV until after Jan 1. The CBI has made it clear that ALL of the bal of 8 cabinet members must be installed before they will act. I also believe that there is so much fraud in the government that people have been making so much money from, such as the auctions that they don't want to see the RV go through anytime soon. The Iraq people have had to deal with this corruption for so long that they have no faith in the government. The RV needs to be done, not for us but tor the citizens of Iraq who have very little.

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Call me crazy but as far as the folks in The south of the country are concerned they would prefer clean water to drink and grow food with before wanting an RV.

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Hi Adam!

 

As ALWAYS, many Thanks for Your down to earth and tempered posts, Adam, AND The Very Best Of The Rest Of Your Week AND Your Up Coming Weekend!!! :tiphat:

 

I am SO Thankful for Your Rock Solid AND Bullet Proof poo poo guru poo poo filter!!! :twothumbs:

 

I, for one, wish I had such a useful "filter". Hey, I would purchase a poo poo guru poo poo filter like the one You have AND use if available through the Store here at DinarVets!!! :D

 

I REALLY appreciate Your focus on and acumen (as well as nous) for the ACTUAL relevant aspects to this Speculative Bicraqi Iraqi Dinar Investment so have no problem seeking relevant input. :eat:

 

So, my take (hopefully at least somewhat relevant).

 

I lump in now to nominally the end of January 2019 for significant changes in the international Bicraqi Iraqi Dinar exchange rate with up to end of day Monday, January 7, 2019 being the MOST prime.

 

PROS

  • Massive Volume of funds to be exchanged internationally for the needed Reconstruction, Construction, Economic Development, AND Foreign Investment. The "closed economy" weekday CBI daily currency auctions of nominally 200 million USD per day won't cut it and needs to be a real time "open economy" transacted based.
  • The Bicraqi Iraqi weekday CBI daily currency auctions are corrupt and the Bicraqi Iraqi are UPSET about that so they need to stop and go to a real time "open economy" to eliminate THAT corruption with the current program for Anti Money Laundering AND Corrupt Foreign Terrorism (or something like that) (AML/CFT) in place.
  • The stiff Insanian sanctions are in place AND the specific Insanian entities (banks included) have been cut off from SWIFT. The ability to FREELY purchase Insanian crude oil is "tanking" and cutting off a significant source of income so a priori prioritizing the cutting off the Insanian Terrorist Machine Funding via the corrupt weekday CBI daily currency auctions would make sense for terminating another significant source of income from the Insanians.
  • The Bicraqi Iraqi were told to wean off the Insanian electricity and other sanction related items in 45 days nominally ending on December 23, 2018.
  • The internationally exchanged Bicraqi Iraqi Dinar rate likely needs to be stabilized BEFORE the implementation of the Bicraqi Iraqi 2019 budget (hence first full week day of Monday, January 7, 2019).
  • Due to the apparent shortage of 250, 500, and 1,000 dinar notes in Iraq, the demand could skyrocket with more Bicraqi Iraqi Dinar notes being pulled out of circulation due to damage, etc.
  • The Parliament is looking to boot Ali al-Alaaq from acting as Bicraqi Iraqi CBI Governor.
  • It was announced NOW is the time to fill the remaining 2018 budgetary items that seems to be out of place for ANY sort of urgency with the Bicraqi Iraqi. NOTHING else seems to get done ON TIME so why NOW???!!! If the Bicraqi Iraqi Dinar international exchange rate were to change SUDDENLY, the cash flow in Iraq could be problematic if the numerical values of the Bicraqi Iraqi Dinar were apportioned according to the 2018 budget.

CONS:

  • Nouri al-Maliki is still breathing and reeking havoc behind the scenes. I suspect this is why the remaining 8 Cabinet Members were NOT voted on this past Monday as advertised last week. As well as other problems to include the Insanians in Iraq meddling in a host of Bicraqi Iraqi affiars.
  • The Nouri al-Maliki appointed temporarily acting CBI Governor Goof Ball Ali al-Allaaq is still doing stupid stuff as acting CBI Governor and looks like HE can't do much of anything since, when he does, Parliament is all over him. I suspect Ali al-Alaaq CAN NOT legally modify the international Bicraqi Iraqi Dinar exchange rate so is conveniently placed to facilitate the financial corruption through the Bicraqi Iraqi CBI.
  • The Bicraqi Iraqi Cab'net is not fully seated. This could be a sticking issue for International Confidence for Bicraqi Iraqi Stability, Safety, Security, AND Stability.
  • There APPEAR to be some pesky pieces of legislation that APPEAR to need to be approved and implemented such as the remaining portions of the HCL, Federal Court Law, Article 140, etc.
  • International Credit Agencies have NOT given Iraq an international investment worthy credit rating.
  • Not all the UN Resolutions have been satisfied.
  • There is a Stand By Agreement in place that has yet to be fully satisfied.

 

All in all, I think there is more going on BEHIND the scenes to make the most of the remaining 2018. I favor more of a quicker change in the international exchange rate of the Bicraqi Iraqi Dinar for a more stable transition to the advertised 2019 Reconstruction Phase as well as getting things set for the 2019 Bicraqi Iraqi Dinar Budget to be implemented smoothly.

 

I believe sooner rather than later to prevent wild speculation that could drive the international Bicraqi Iraqi exchange rate down. My opinion is Nouri al-Maliki and Ali al-Alaaq will need to be fully removed as a couple key indicators of significant progress being made to kick off the Reconstruction Phase so I anticipate (I may be wrong here) Good News about the "disposition" of at least THOSE Two Miscreants.

 

So, my "prime time" (hopefully before) is December 23, 2018 - January 7, 2019 (nominally two week "window") with going beyond January 31 could be problematic especially if the 2019 Bicraqi Iraqi Budget is "opened".

 

Just my conjecture, thoughts, opinion, and :twocents: for whatever THAT is worth!!! Hey, I might be a nut job or somethin'!!! CAVEAT EMPTOR, Reader!!! :o

 

In The Mean Time....................................................

 

Go Moola Nova (YEAH AND YEE HAW, BABY, READY WHEN YOU ARE BROTHER (OR SISTER) - LET 'ER BUCK!!!)!!!

:rodeo:   :pirateship:

Edited by Synopsis
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Iraq has operated for years without a full cabinet, so I doubt that they actually need to have all before the RV.  Besides, the GOI and the CBI are independent so the CBI can RV whenever Trump tells them to.

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No facts or figures. Just think it would make sense for the RV to occur before the end of the year to allow it to somewhat stabilize before heading into 2019. They've been moving forward, the news has been great and there's still 45 days left in the year. plenty of time to take care of outstanding issues like Budget,  HCL, Maliki, Corruption, etc. Sorry I used both Maliki AND corruption. I forgot they were interchangeable.

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The walls are closing in on Maliki with the reduction in upper level government staff and hopefully he won't be able to negotiate a new place in the government to seek protection from prosecution. The Maliki appointed CBI Govenor looks really bad with the last minute bombshell of the sewer soaked 7 Billion Dinar. We need a seated government followed by a big ROUND UP of corrupt officials. This should go a long way to proving to the people of Iraq that their government is working on their behalf.  Approval of the HCL and a currency with newly issued lower denominations  plus an associated rate change.

I have been hanging on the edge of my seat for many years but this country does not move fast on anything. At this point I'm thinking 2019 although the pressures of sanctions on Iran along with the dollar and oil squeeze may force it into this year which I truly hope so because I'm tired! A few years ago during one of our election cycles there was some middle east crisis in the news and a congressman from some east coast state made a comment something like.... "You can't trust anybody with a Dairy Queen tablecloth and a fan belt on their head". He conveniently disappeared from the scene never to be heard from again. At this stage of the game with so many things I have read and the corruption that is rampant in Iraq I am truly ready for this ride to be over not to mention that I sorta share that politicians sentiment.

 

The FAANG Stocks are two rich for my blood. They are fun to watch! I rode in a Tesla Model 3 the other day and I was quite impressed by it's features and benefits along with the ride and quiet cabin. The stereo was high end home audio and you could even play video games. All in all.. Tesla was super neat technology that I would consider owning at some point. I am an avid fan and customer of Amazon. It's convenient , fast, easy if you need to return something ( on that note I don't know how ebay stays in business) and Amazon is competitive on many items.

 

Oil is really a risky sector to say the least. I've been watching some potential oils stocks for months and I have seen them take big hits just in the last few weeks. Don't know if I will play even at the low prices I'm seeing today.

 

CRYPTO - Well that is equally as confusing as oil. I dabble in several coins now and some alt coins but I am down at least on the alt coins as much as 50%. I am hopeful that they will return and soar way beyond my expectations but who knows. Markets are jittery and I think people are anxious to see what happens with the change in congress. Hopefully we can continue moving forward and hopefully our current state of political misery will subside and people can just agree to disagree like we always have and still continue to move forward. I am glad Texas stayed RED and hope that all our elected officials work together to keep this country great.

 

GO DINAR!

 

 

 

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Just my thought but if POTUS Trump and the UST do have anything to do with the IQD and it's value I would think getting it done before the Year End of 2018.......The Elections here aren't looking good at all with the Voter Fraud running rampant and the Left over turning Senate Races.

 

They took the House and are demanding Investigations into anything Trump. If they should pick up 2 Senate seats nothing will get done and the House or the Senate for a good 2 years thanks to the Hard Core Partisan Divide.

 

Then a while back people were claiming the price of Oil had to drop before Iraq would need to make some adjustment in value.......it is down big time today.

 

Karsten

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it has been said that there is a 2018 budget surplus, it seems that if that is the case, this year would be the time to revalue

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      I'm happy to state that today is not the day I'm getting off the bus. In fact, I'm pulling the seatbelt tighter!
       
      There was a question posed a couple weeks back about "sterilization". The CBI employs a procedure called "sterilization" as a monetary policy, but that is different than what may have been being asked... which is why I asked for clarification on it.
       
      I wanted to go deeper into the topic, but my post on CBI Auctions and the Iraqi Budget was already getting a bit lengthy. As of this morning (Friday 13 March 2020), there is a lot of "sterilization" talk - and most of it is not related to monetary policy, but actual disinfecting. The CoronaVirus is currently causing chaos in the markets, creating instability and fear that is likely to last a bit longer (but not forever), and it's always good to "get back to the basics".
       
      You know - a "check in". In these crazy times, are we the crazy ones? Are we crazy for sitting this ride out a little longer? Should we be throwing in the towel, selling all our dinar, and spending all of our money on toilet paper and hand sanitizer?
       
      I think the answer lies at least partly in the following subjects, so let's get into it! 
       
      The topics today are as follows: CBI Auctions, and the Iraqi Budget.
       
      Before we do a little bit of a deep dive, I have a couple of opinions that may seem contrary - namely, the Budget and the Auctions, while important to Iraq, will probably never have a significant impact on (when or if) the RV.
       
      In spite of that, the seatbelt just got tighter, and my smile got bigger.  These are complex topics, I'm going to simplify a little and I'm only covering a few of the aspects, but these are major parts of the topics and therefore a major factor in the size of my current smile.  The summary, which you'll understand if you can make it through this entire post, is simple. Despite these scary and crazy times we are living in, Iraq and the Iraqi Dinar still have incredible potential.
       
      The rate of a currency is generally set by the countries Central Bank, not the IMF or anyone else. Iraq's rate is set by the CBI (Central Bank of Iraq).
       
      Ready? Here we go!
       
      CBI Auctions. These are used by the CBI to regulate the money, control the money, maintain the money - specifically, the rate and the amount in circulation. Actually, the CBI is selling USD at the auctions... but this will turn into a 7 hour read if I go too deep into that!
       
      It's helpful to understand where Iraq comes up with the USD to sell at the CBI auctions. The short version is this: Iraq's primary source of revenue is OIL. Payments are made in US Dollars, paid to the DFI (Development Fund For Iraq). The USD is then transferred to the Ministry of Finance (MoF), and the MoF sells it to the CBI in exchange for Dinars - the same Dinars that the CBI collected through the Auctions of USD.
       

      image source
       
      See how that all came full circle? Money in, money out, easy peasy. (This will take us to the Budget later.)
       
      (Fun fact! Dollars go to the DFI account rather than directly to the MoF to prevent the money from immediately being confiscated to pay reparation debts... kind of like using an IBC to protect assets.)
       
      We can expect the auctions to continue while the Dinar is pegged to the dollar, undervalued, and the circulation needs to be controlled.
       
      There are some people who believe the Auctions in Iraq need to stop, and there's good reason for that - few countries have had success with them. For example, South Sudan (who knows where that is?) tried it four times after they devalued. South Sudan, which is known as one of the most underdeveloped nations in the world, and who's primary export is timber. That's no knock on wood, the world needs wood... but wood isn't oil, and South Sudan isn't Iraq. (Sudan and South Sudan don't even make the top 100 in the world for oil reserves.) Iraq is obviously different, both in potential here and in the successful practice of having auctions.
       
      Other countries to do currency auctions include Jamaica, Uganda and Sierra Leone. Like South Sudan - none of them are Iraq, and none of them carried Auctions as long as Iraq... in fact, the auctions in those cases were failures.
       
      With those examples in mind, of course we'd like to see the currency options stop.
       
      And they probably will, at some point. But most likely not until after the RV.
       
      Since the auctions aren't stopping, and Iraq is not the same as the countries that failed at auctions... what can we expect during a major rate change?
       
      Fantastic question! I'll take a stab at it, using examples to make the point.
       
      At the auctions, the CBI operates buy/sell at about a 2% difference, which is an effective start of the spread that will affect every single one of us.
       
      If the rate were changed today to 1IQD per 1USD and the IQD returns to the global market (it will, at any significant increase in rate), then we will be trading in at the rate stated by the CBI minus middlemen fees - what it costs to actually get the money through the various institutions and into your account. (This isn't Bitcoin, you know!)
       
      If the CBI is using a 2% spread, they will "buy" at .98 and "sell" at 1 per US dollar. I fully expect that to fluctuate, perhaps wildly. They may pay .99 at first to show their confidence, and then lower it to .90 or further. (The bigger the differential, the more beneficial it is to them for the day profits.) They may quickly move to a flat 1:1 "Auction rate" simply to reinforce the rate and show that they are going to ditch the auctions soon - a lot of this is going to depend on the market. It is a business, after all.
       
      A 2 cent difference may not seem like much, but bear with me... It is important to understand the spread!
       
      I'll keep using the 1:1 number. For example, Iraq announces that the dinar is equal to the US dollar, the CBI is backing it, the IQD goes on the global market, and the rate sustains itself after a short time due to market demand. At this point, a lot changes, but those are different (and much longer) conversations. When we exchange, we are not going to the CBI - we are going to a bank that will trade IQD for dollars (or any currency). That bank will rely on the CBI buy rate first, which means they are getting a max of .98 USD per 1 IQD. Then they have to pay tellers and all their other expenses, so they add their spread on top of that - and this is assuming the bank you use is buying (selling) direct with the CBI. (They won't be.) By the time it gets to you, the CBI may have an advertised rate of $1, but you're only putting .70 in your pocket (before taxes).
       
      That "spread", or "cost", is unavoidable. We are not going to get the full "rate".
       
      Of course, you will get a better rate (money in your pocket) if you're VIP here at DinarVets, but that's not the point of this. The point is the Auctions will continue, and looking at past auctions - even yesterday's or today's auction - will not give us clues to if Iraq will RV today or tomorrow. (If we could see tomorrow's auction, that would be a different story!)
       
      The Auctions are good to see, in Iraq, because they are proof that Iraq is stable, still in business, and functioning. But the CBI Auctions will not give us the RV date until after you get my text message.
       

       
       
      The Iraqi Budget. The Iraqi Budget is important to Iraq because it defines how they spend money - and yes, it's the same money that was mentioned above, which comes mostly from oil sales. The MoF distributes IQD to each department according to the Budget. The Budget allocates resources to specific departments, based on a percentage of revenue or a fixed amount, and the individual departments spend their portion accordingly - just like giving your kid an allowance.
       
      A Budget works the same way in most places, and Iraq is no different. Politicians lobby for their departments, asking for more money always, and this is why a "tripartisan" government is so important and mentioned so much in the current Prime Minister debacle. If a Prime Minister came in and seated all members of one political group, it would be like the US having only Democrats or only Republicans in power. The reason we hear about the Iraqi Budget so much is simple - they are all fighting for money. (Or power, but it's really the same thing.)
       
      The reasons I say the Iraqi Budget doesn't matter are pretty simple. You've made it this far, stick with me just a little further!
       
      1.  Whether a specific Department (Defense, Education, etc) is on the Iraqi Budget for a percentage or a fixed money amount, there is a dollar/dinar amount that can be assigned to it based on the current price of oil x demand for oil = projected income / department allocation = $ for Department. This is a simple calculation that can be done in 2 minutes on a 1 page presentation. It's literally 2nd grade math.
       
      2. Regardless of any rate change, that dollar amount can be estimated and stay the same with a simple Amendment. Imagine a late night Parliament meeting - called at the last minute after 8PM one night, emergency, mandatory! One item on the agenda - doors are locked, cell phones left outside - the ONE ITEM is this: We are going to raise the rate at midnight provided everyone signs this Budget Amendment.
       
      The Budget Amendment, in this case, states that the previous passed Budget is fixed at the old rate and all Departments receive an immediate 10% bonus due to the CBI exchange rate adjustment. The rest of the money that becomes available is held in reserve until further modification of the Budget... EVERY SINGLE POLITICIAN is a hero and has almost unlimited job security at that point.
       
      Not one of them loses. It's the biggest slam dunk in Parliament history.
       
      Of course they wouldn't magically start to get along, but that's an offer even that bunch of hooligans couldn't screw up.
       
      OR:
       
      3. Bypass the late night meeting and just pass a Presidential declaration stating the same. It accomplishes the same thing, and by the time anyone could complain, the rate would have been in effect long enough that it wouldn't matter. The President knows this. The CBI knows it. You know it. I know it.
       
      The bottom line here? It doesn't matter what the Budget says, because all the Budget really does is allocate money to departments. The rate, based on the global fiat currency exchange program, controls how many wing dings and knick knacks they can buy with their money because of it's international status... but the Department of Wing Dings is still going to have $X of the Budget, the Department of Knick Knacks still has $X, regardless of the rate, and that's the way it works. Fiat currency isn't an "Iraq" thing - it's a WORLD thing. OIL isn't an Iraq thing. Budgets aren't an Iraq thing. Currency manipulation isn't an Iraq thing. NONE of this is unique to Iraq - all of this is "business as usual", and when Iraq changes their rate, that's what it is - business as usual.
       
      Conclusion:
       
      There are plenty of good reasons for intelligent people to discuss the Budget and the Auctions. It's important that Iraq continue to be successful in the Auctions, pass their Budget, and continue doing business. While the world demands OIL, those who have it will always have credit. Iraq has proven itself capable of utilizing Auctions as a form of monetary control, and I don't believe their Auctions or Budget are a hindrance to increasing the value of the Dinar.
       
      In fact, it looks quite the opposite. And on that note, I say...
       
       
      GOOOOO RRRRVVVVV!!!!!
       

       
    • By Adam Montana
      Hey hey DinarVets!
       
      I was out yesterday and most of the day before with a bit of a bug - I didn't die, so I assume it's not Corona.
       
      Or maybe it was, and I beat it. Wouldn't surprise me.  
       
      This is just going to be a brief post for today. I spent the weekend (before I was attacked by that bug) working on a deep-dive post regarding Iraq's Budget and CBI Auctions. I'll get that posted by tomorrow morning.  
       
      To the present moment... we are looking at one of the craziest times in world news that we have ever seen.
       
      We may not have an actual health emergency on our hands - the plain old flu is more dangerous to the population, strictly by the numbers - but we certainly do have a financial crisis on our hands. The world, and the world markets, are treating the Corona Virus as if it were a full blown pandemic - so, whether it deserves to be treated that way or not - that's what we are dealing with.
       
      OIL is down to about $30. BTC leapt off the cliff and plummeted to $6000, wiping out all the recent gains. Stocks... don't even get me started on the markets, I'm just thankful @Pitcher has been willing to share thoughts over the last few updates! It hasn't been pretty.
       
      Iraq is vulnerable to all of these things, just like the rest of the world - and on top of that, they are dealing with a Prime Minister issue. 
       
      In spite of all that... guess who's not going anywhere?
       
      Iraq, you, and me. We aren't going anywhere.
       
      Especially not in public without some kind of contraption on our faces  
       
      I'm really short on time today, so I'm going to get this posted for now.
       
      Stay tuned for the update on the Auctions and the Budget - I just need to proof it once more and it will be up.  
       
      OSI members, I'm a day behind regarding that last notice we were discussing. I'll be following up on that one shortly as well. Thanks for your patience!
       
      Talk soon!
       

       
      - Adam
    • By Adam Montana
      Hey hey good morning DinarVets!
       
      This is one of those "holy MOLY" spots in history - so much is going on right now!
       
      Coronovirus is shaking the stock markets - if you didn't catch @Pitcher's posts in my chat last week, they are worth a look!
       
      Super Tuesday was yesterday, and it looks like the Dem race is officially Old White Guy #1 vs Old White Guy #2. (I have nothing against old white guys, I just think it's funny  ). Mike Bloomberg bought American Samoa, apparently.
       
      Speaking of politics... 'tis almost full tilt political season, according to the drama-meter we run in the background. I'll take a second to gently remind everyone that this is a nice place to visit, we won't all agree on everything, and we like to keep things calm, cool, and collected. And nice. Just be nice to each other, please.  
       
      BTC is hovering around the 8700 mark, despite the political and health topics and markets. Solid.
       
      On to the dinar, which is of course the heart of these updates!
       
      We also have some member questions that I'll get to shortly.
       
      Sitting (temporary?) PM Allawi has threatened resignation - rather, he has "withdrawn his candidacy". 
       
      I said from the start that he wasn't my top choice for the spot, but he certainly impressed me! The man went in and started kicking things around like an Iraqi Jack Welch, which is exactly what needed to happen in Iraq. I get the feeling that he is an "all or nothing" kind of guy and didn't feel comfortable with what could have been a solid 80% win. 
       
      So, what's next? 
       
       
      The Iraqi President can simply appoint someone (again), but it's not necessary to take drastic action. Maybe Mahdi steps back up (he was never really gone), but that doesn't make a difference either. As mentioned in a recent post:
       
       
       
      The good news for us, and Iraq? 
       
      No matter who steps into the Prime Minister role next, Allawi was able to get some wood chopped. Iran lost a LOT of power over the last month, for one. I think that may have more to do with Allawi's current decision than anything - he seems to want them completely gone, not just 80% reduced. 
       
      Most importantly, and this is the crux of the matter, Allawi wasn't elected to this position in the first place - yet, things got done. In my opinion, the raise in the value of the Dinar is going to happen regardless of who is sitting in the Prime Minister chair. 
       
      All of the things that need to happen in Iraq continue to happen, and "who" is sitting "where" does not seem to matter. 
       
       
       
      EDIT: As I was wrapping up this post, @tigergorzow posted this:
       
       
      My thoughts on it were stated above, and remain the same - the name doesn't matter, as long as it's not Maliki! Someone will be in that seat, soon, and the train will continue to chug along.
       
      We are getting close.  
       
      ====== Member questions below =====
       
       
       
      This is a very reasonable question - it is based on logic and a thoughtful approach to the issue...
       
      ... unlike fiat currency, which is based on nothing of the sort, and actually throws reason out the window. The Iraqi Dinar is a fiat currency, just like the US dollar, and logical rules utilizing responsible financial principals simply do not apply.
       
      For this reason alone, it simply does not need to make financial sense to RV. Check out @ladyGrace'sDaddy's post below:
       
       
      Nicely stated, LGD.
       
      The summary is this: Iraq doesn't need a 1:1 reserve:cash ratio to have a 1:1 parity with the US dollar, or any other ratio to the dollar. The only thing that matters is "will it sell" - and, it will.
       

       
       
      There's always one in the group!  
       
       
      This is a great question as well! I don't think "massive" is the correct term. "Significant" - definitely, but it's not "massive".
       
      Nonetheless - I would only be concerned if OIL was suddenly no longer in demand. Any dips or peaks in the price of oil are temporary until the global demand for oil is eliminated.
       
      While OIL is a necessary product in the global economy, the price can fluctuate all it wants - Iraq still has a majority of it, and they will be able to bank on that.
       
      If the entire world switched to solar overnight, then it would be "game over". Until that happens, I am not too concerned about the price of oil.
       
       
       
       
      1 - I'll need more info on "1,000,000 IQD is forbidden". The rule is $10,000 (USD) and up must be declared in most countries. 
       
      2 - I still remember my first trip to Dubai, where there was a security checkpoint that required removing our shoes and they sprayed everyone's feet with disinfectant on the way through... but regarding your question, I'm going to need a link to be sure we are discussing the same thing  
       
       
      Great post, Synopsis
      The forum software will collapse your comment, but I'd encourage anyone interested to click on it to expand and read it. 
       
      My answer: I agree with your closing statement:
       
       

       
       
      Auctions... I'm not sure what you mean about the auctions. The auctions don't matter - if they sell at 1160 today but sell at 12 tomorrow, do we care what the rate was yesterday or if they did an auction yesterday? 
       
      The auctions will continue after the rate is changed. It's how they do business.
       
       
       
      Iran's influence was a major factor, but it is greatly reduced already and looks to be shrinking more by the day.
       
      All is well in my opinion!  
       
       
      ========= / end Member Q's =======
       
      WHEW! That was a fun update, I really appreciate the feedback and questions from the members! I'll do that again soon, or not, depending on Iraq.
       
      Don't forget to chuck your numbers in the Weekly Pool, and GOOOOO RRRRVVVVVV!!!!
       
       
       
      - Adam 
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