Please help settle an argument

[wcmboss]

Ok, I'm still rather new here, so please don't bash me. I've been lurking in the background reading everything that comes out. I have "drank the kool-aid, and thought I would be filthy rich by the reports given here, and Adam has said "no lop". But here is the sticking point between me and a friend. How is the RV of the dinar going to affect the people of Iraq? Here is the question using this analogy: Today an Iraqi is poor, and his 25,000 dinar will only buy a loaf of bread. But "tomorrow" when it RV's to $3.00, he will be able to go buy a brand new car/corvette. How does this get controlled? My friend says from what he reads from the reports, that the 3 zeros get dropped, and now it is 25 dinar x $3.00 = $75, so now he can buy 3 loaves of bread. So he is better off but not rich. So with this theory, a million dinar that I purchased for $1,000 would now be $3,000. Which is a nice gain, but not what I had in mind.

My friends question is how does this work, that all of these dirt poor people are now upper-middle class in a day. I really appreciate your sincere answers to help explain this to my friend-or to me- whoever is right, sources and links are greatly appreciated!

[cris]

most of the poor live day to day....they dont have these 25k notes just layin around

[Kimjackie]

Ok, I'm still rather new here, so please don't bash me. I've been lurking in the background reading everything that comes out. I have "drank the kool-aid, and thought I would be filthy rich by the reports given here, and Adam has said "no lop". But here is the sticking point between me and a friend. How is the RV of the dinar going to affect the people of Iraq? Here is the question using this analogy: Today an Iraqi is poor, and his 25,000 dinar will only buy a loaf of bread. But "tomorrow" when it RV's to $3.00, he will be able to go buy a brand new car/corvette. How does this get controlled? My friend says from what he reads from the reports, that the 3 zeros get dropped, and now it is 25 dinar x $3.00 = $75, so now he can buy 3 loaves of bread. So he is better off but not rich. So with this theory, a million dinar that I purchased for $1,000 would now be $3,000. Which is a nice gain, but not what I had in mind.

My friends question is how does this work, that all of these dirt poor people are now upper-middle class in a day. I really appreciate your sincere answers to help explain this to my friend-or to me- whoever is right, sources and links are greatly appreciated!

No bashing here. They dont have much to begin with and before the war their dinar was worth about $3.22. They only have about $250 per month so no they cannot buy a corvette but they will still feel very rich indeed. They deserve it.

[prayin4peace]

Let's analyze what has happened to the "average Iraqi family'. Let's suppose that before the $h*t hit the fan, and when the dinar was worth $3.22, that the family had a net worth equal to $64,400.00. That would mean they had about 20,000 dinar. If they still have their 20,000 dinar, they are worth $17.09 (20,000 / 1,170). If they took their 20,000 dinar, traded it for the new 20 dinar note and tripled the exchange rate, they would then have a net worth of $51.27. I can't imagine that the people that were worth $64,400 before are going to be happy being worth $51.27. Just my opinion.

[bluejay]

I believe when IQD gains in value, the Iraqi people will gain due to there whole infrastructure changing to acomadate the new value. Example I've heard the average Iraqi family earns 75,000 Dinar, it cost 5,000 to buy a loaf of bread at current value, when it RV's the value will be compared to the US so picture your in Iraq and have that 75,000 dinar that one day could buy a dinner & next day could buy a house. I hope I made some sense I know I'm right but hard to spell it out.

[Peepster]

I believe there needs to be a distinction between devaluing and removing. Dropping zeros devalues the currency: $25,000 becomes $25, although technically something that cost $25k would cost $25 after the lop. Removing bills with zeros does just that... the govt. removes all the higher denomination bills out of circulation: $25,000 is still $25,000 but you must have multiple bills to represent that amount of currency. So in the U.S. most banks would cash out $25K using 250 x $100 bills because there is no such thing as a $25k note.... that is assuming the govt. does not send us into hyperinflation and makes one up.

[Iwantcheesecake]

They have been talking "removing the zeros" . How does that work and what does that mean as an investor???? I am new here also and have interest in the Dinar. What prayin4peace states, makes since, so I hope they are right.

I love cheese cake on a stick!

[quadraph0nic]

I'll be so glad when this is finally over and all these questions and speculations will be done with....How will this work? Well, how does a dollar work? What the heck back's our powerful currency? if u look it up and also look up what other countries do to back their own currency then you might find yourself looking at two schools of thoughts on what they have to do...

If they can only back their currency with other countries currencies such as the US $ and gold then mmmm doesnt look good...

If they can back their currency with assets and the promise of resources they have such as the amount of oil they have....well then why not? What are we backing our dollar with?

So what rules is the dinar going to play by? What rules does the US dollar play by? What is Iraq to us? Its our asset....we did everything but plant our flag. Do u think we spent all this money here for nothing? and sad to say i now understand that war is a business venture. Right now I cant think of anything that will save America but this.

i also am not as concerned anymore with what the iraqis do because someone has them on a leash....

and so they are free to do what they are told.

[Peepster]

So the question I would ask as a newbee is:

Before the invasion, Iraq had X trillion dinar in circulation and Y trillion dinar on the books/banks for a total of Z-then trillion dinar and that equated to a traded value of 3.XX dollars to the Iraqi dinar.

Now, Iraq has X trillion dinar in circulation and Y trillion dinar on the books/banks for a total of Z-now trillion dinar and that should equated to a traded value of what ever we think RV will be.

So using my electrical engineering logic, if Z-then equals Z-now, we can assume that the RV rate will be approximately the same as it was before the invasion.

So how much dinar existed before the invasion (Z-then) and how much dinar exists now (Z-now) is my question. If these two are equal we should be good. If Z-now is much larger than Z-then, my guess is that our hopes for a high RV might be dashed; a significant amout more dinar now would suggest that supply out weighs demand compaired to prior to the invasion and the market cannot support a equal or higer value compaired to pre-invasion dinar.

Does anyone know the how much dinar existed before the invasion and how much there is now?

Thanks

[TimS]

you just might have hit on it.....there is a lot more dinar out there today than there was in 1991, which is why I've been asking how anybody thinks the value of currency (in dinars) can go from $23,000,000US to $81,000,000,000US over night. That's based on there is about 27 trillion dinar in circulation today and it RV's at $3US

[okane]

Twenty plus years ago I was in Japan for two years. I received money from the states each month for expenses. When I first arrived in Japan the exchange rate was 251Yen / 1USD. Four months into my stay the rate dropped to 140 Yen / 1 USD. That HUGE drop for me and gain for anyone being paid in Yen did not effect the price of bread (or anything else) in Japan. What it did do is increase the buying power of the Yen. At that time you saw the Japanese traveling, buying up properties in the U.S. and everything else American. The cost of living in Japan did not increase based on the world currency market. When we ( collectively) devalued the Dinar, life went on IN country. The currency was traded dinar for dinar, 1.5 for the Swiss dinar and a loaf of bread was still a loaf of bread. But OUT of country everything changed. Before the war the Iraqi people could buy a Dell computer loaded for about 350 IQD today that same priced computer would cost them a million IQD. When the dinar RVs the daily life and the general cost of living for most Iraqi people won't change much. What will change are the choices that they have OUT of country. Travel, foreign products, Dell computers.

There will not be a LOP. There will be an RV or RI. The Iraqi upper middle class will flock to Dubai, the average citizen will be able to travel and Dell stock will rise ......... hold on, my crystal ball is getting cloudy.

[TimS]

Think about what you just said.....right now the average Iraqi makes 75,000 dinar? that's $64US if nothing changes in country after a RV, why would any Iraqi stay in country......their currency doesn't buy them any more in country, but it buys them everything if they leave?????? Your example of the yen does not pertain......fluctuations in daily world markets is not the same as going from worthless to riches overnight......if a loaf of bread cost 5000 dinar pre-RV ($4.27US) you're going to tell me it's still gonna cost 5000 dinar ($15,000US) after the RV? Com'on

[Peepster]

I am tracking okane, but how much dinar existed before the invasion and how much exists now? If the two are about the same factoring in inflation and GDP adjustments we can easily infer that the RV or the gradual global trading point for the dinar would be about the same as before the invasion. I am not telling you, I am really just asking because I am using logic and sometimes economics is not logical. Thanks,

Philippe

[wcmboss]

Thanks everyone for your responses and being nice. I think this is helping to get to the bottom of it. Hopefully in just a few SHORT days, we will all be sleeping soundly on pillow of green! Come on RV, baby! You can do it!

[wgb52]

So the question I would ask as a newbee is:

Before the invasion, Iraq had X trillion dinar in circulation and Y trillion dinar on the books/banks for a total of Z-then trillion dinar and that equated to a traded value of 3.XX dollars to the Iraqi dinar.

Now, Iraq has X trillion dinar in circulation and Y trillion dinar on the books/banks for a total of Z-now trillion dinar and that should equated to a traded value of what ever we think RV will be.

So using my electrical engineering logic, if Z-then equals Z-now, we can assume that the RV rate will be approximately the same as it was before the invasion.

So how much dinar existed before the invasion (Z-then) and how much dinar exists now (Z-now) is my question. If these two are equal we should be good. If Z-now is much larger than Z-then, my guess is that our hopes for a high RV might be dashed; a significant amout more dinar now would suggest that supply out weighs demand compaired to prior to the invasion and the market cannot support a equal or higer value compaired to pre-invasion dinar.

Does anyone know the how much dinar existed before the invasion and how much there is now?

Thanks

It is my understanding that there is more than a thousand times as much currency now as before the invasion.

[jdrtkm]

It is my understanding that there is more than a thousand times as much currency now as before the invasion.

[/quote

I think you are correct, Saddam had a mint here and he printed at will, but I think there is more now, and that they are worth the same toady as it was then, outside of Iraq. That 3.32 rate was his rate, good inside of Iraq, Their old money was not used on the world market from what I understand. I do not even know when the last time Iraq had a global traded curency.

[blanc]

I think your math is wrong on the million dinar being worth $3000.00 also. If it rv's at $3.00 ex. it is worth $ 3,000,000

Be Blessed

GO RV

[jdrtkm]

I think your math is wrong on the million dinar being worth $3000.00 also. If it rv's at $3.00 ex. it is worth $ 3,000,000

Be Blessed

GO RV

He is talking about IF he has to turn in 40- 25000 bills for 40- 25 dinar bills and it were to revalue at 3.00. that is were he is getting the 3000 from.

[shirleyjune]

Ok, I'm still rather new here, so please don't bash me. I've been lurking in the background reading everything that comes out. I have "drank the kool-aid, and thought I would be filthy rich by the reports given here, and Adam has said "no lop". But here is the sticking point between me and a friend. How is the RV of the dinar going to affect the people of Iraq? Here is the question using this analogy: Today an Iraqi is poor, and his 25,000 dinar will only buy a loaf of bread. But "tomorrow" when it RV's to $3.00, he will be able to go buy a brand new car/corvette. How does this get controlled? My friend says from what he reads from the reports, that the 3 zeros get dropped, and now it is 25 dinar x $3.00 = $75, so now he can buy 3 loaves of bread. So he is better off but not rich. So with this theory, a million dinar that I purchased for $1,000 would now be $3,000. Which is a nice gain, but not what I had in mind.

My friends question is how does this work, that all of these dirt poor people are now upper-middle class in a day. I really appreciate your sincere answers to help explain this to my friend-or to me- whoever is right, sources and links are greatly appreciated!

The rv will only affect the people trading IQD for another currency. The buying power will remain the same in Iraq. The electric company will build electric plants, all the manufacturers will hire the people, the wages will go up, the standard of living will rise, (JMO)

[okane]

The rv will only affect the people trading IQD for another currency. The buying power will remain the same in Iraq. The electric company will build electric plants, all the manufacturers will hire the people, the wages will go up, the standard of living will rise, (JMO)

Hey Shirleyjune, thank you having a level head and showing some common sense. Funny how people don't realize that money is traded just like stock, even when they are doing it.

So the question I would ask as a newbee is:

Before the invasion, Iraq had X trillion dinar in circulation and Y trillion dinar on the books/banks for a total of Z-then trillion dinar and that equated to a traded value of 3.XX dollars to the Iraqi dinar.

Now, Iraq has X trillion dinar in circulation and Y trillion dinar on the books/banks for a total of Z-now trillion dinar and that should equated to a traded value of what ever we think RV will be.

So using my electrical engineering logic, if Z-then equals Z-now, we can assume that the RV rate will be approximately the same as it was before the invasion.

So how much dinar existed before the invasion (Z-then) and how much dinar exists now (Z-now) is my question. If these two are equal we should be good. If Z-now is much larger than Z-then, my guess is that our hopes for a high RV might be dashed; a significant amout more dinar now would suggest that supply out weighs demand compaired to prior to the invasion and the market cannot support a equal or higer value compaired to pre-invasion dinar.

Does anyone know the how much dinar existed before the invasion and how much there is now?

Thanks

Z-now is the unknown for me also. I have heard so many different figures on the now vs. then that a reliable source seems impossible to find. If we knew that answer ....

take care

[tileman1814]

Wasn't this posted last week?

Semper Fi !!!

[SAG]

I read somewhere on this site that Iraq will be issuing approx $40K per year to each Iraqi based on their oil revenues. Many Middle Eastern countries do this. I think they said until the gov't is formed and the dinar RV's and we start doing business with all the countries this is no where in sight. Please someone correct me if I have the facts wrong. I am not sure that is true of Iran.

[rick25sandi]

I believe alot of people are thinking that the Iraqi people will get see the increase in the dinar but they shouldn't. If we take an american dollar to canada it is worth 1.02 if a canadian comes to the u.s the canadian dollar is worth .97 in the u.s. but the canadian dollar does not change in canada and the u.s. dollar doesnt change in the u.s.. An iraqi with a 25,000.00 dinar note would have to come to the u.s. to get the 75,000.00 u.s. dollars if the rv is 3.00 but in iraq it is still only 25,000.00 dinars

and that is my understanding of it

[okane]

Think about what you just said.....right now the average Iraqi makes 75,000 dinar? that's $64US if nothing changes in country after a RV, why would any Iraqi stay in country......their currency doesn't buy them any more in country, but it buys them everything if they leave?????? Your example of the yen does not pertain......fluctuations in daily world markets is not the same as going from worthless to riches overnight......if a loaf of bread cost 5000 dinar pre-RV ($4.27US) you're going to tell me it's still gonna cost 5000 dinar ($15,000US) after the RV? Com'on

Hey TimS, thank you for your comments. You made me wonder, what is the cost of a loaf of bread in Iraq? According to numbeo.com, .84 USD. Based on an article by Steven Coleman written in January 2010, the overall cost of living in Iraq in comparision to 276 countries, 1 being most expensive, Iraq ranked 250. And it ranked 176 in the food department. I struggle at this point to not argue about the Yen example. But we are invested in this adventure as with any stock, buy low, sell high. The cost of a McDouble doesn't change with the price of McDonald's stock. Whether the stock is $3 or $43 a McDouble is still just a dollar and nobody really cares unless you hold that stock because the price of food didn't change. We are invested in the Iraqi stock called Dinar.