Something To Think About!!!!!

[wgb52]

This is true but does not change the amount of IQD's. When you exchange Dinars for dollars you can certainly destroy the notes but the obligation remains for the dinar debt. The money supply is made up with more than paper currency. If you move money to foreign reserves (instead of paper notes) the amount of money remains unchanged.

wgb52,

You are correct and also incorrect. Big denoms will be exchanged for small denoms IN COUNTRY for those who use Dinar everyday. This is a 'wash' for in country exchange for the RV. However, how many investors outside of Iraq will exchange the big denoms for small? Basically, none. They will be exchanging for USD, Euros, etc. Those big denoms will then be pulled into the CBI through one of several possible scenarios/methods and destryoed; thus, removed from circulation and reducing the amount of Dinar in circulation. This will increase the value of the Dinar on amount in circulation alone.

This is all IMO only buts makes sense when you consider it a little.

BMWman

[RichNick123]

wgb52,

You are correct and also incorrect. Big denoms will be exchanged for small denoms IN COUNTRY for those who use Dinar everyday. This is a 'wash' for in country exchange for the RV. However, how many investors outside of Iraq will exchange the big denoms for small? Basically, none. They will be exchanging for USD, Euros, etc. Those big denoms will then be pulled into the CBI through one of several possible scenarios/methods and destryoed; thus, removed from circulation and reducing the amount of Dinar in circulation. This will increase the value of the Dinar on amount in circulation alone.

This is all IMO only buts makes sense when you consider it a little.

BMWman

BEFORE I RESPOND PLEASE MAKE CERTAIN AND READ THE LAST PARAGRAPH OF THIS POST!!!!!!

Thank The Lord!! Someone finally gets it!!! If the IMF and Iraq have any sense at all what BMWman posted is the route that has to be taken. kUDOS TO YOU BMWman!!!

In my essay I typed I assumed that this would be self explanatory but I reread my post and I did not expound upon this properly. I apoligize to everyone for not adding another paragraph and go into detail. I had it rolling around in my brain and as I was typing, in the middle of the night, I flagrantly forgot to go into detail.

My post was bringing out the fact that the Dinar is artifically being held at a complentely unrealistic value. Iraq cna easily match the funds that Kuwait has in (M1) exchangeable currency at roughly 88 billion USD. This alone would quadruple our investment. If Iraq only reduces the amount of Dinarby half with no revaluation we double our money. If they exchange the currency, in country, and those outside of Iraq cash out while reducing the (M1) simultaneously we could very well see the illusive 3.00+ rate.

The question I am seeking to find the answer for is this:

With the problem we have in translation and the shadowy answers we get it has been impossible to find factual evidence that Iraq is not including the lower denominations, that are not in circulation, in their 25 trillion balance.

Can everyone understand that Iraq had a new currency produced and issued in 2003? Are you telling me they went to the expense of having an entire countries currency denominated and printed and did not go ahead and print the smaller denominations at the same time? Any business owner understands the benefit of having your printing done at 1 time to lower costs even though you may not use all of it imediately. ie. Imagine you went to the trouble of printing 1 business card at a time instead of ordering 5,000. we all know the more you purchase the lower the price per unit!

With the way Iraq handles the rest of their business I would not put it past them to be adding the uncirculated notes into the 25 trillion balance. If someone can give me factual evidence otherwise I would be so very grateful! My thought is that they can RV now as I doubt seriously there are truly 25 trillion Dinar in circulation with onlly 20 billion in (M1) funds backing them!!

READ THIS!!!! 20,000,000,000.00 DIVIDED BY 25,000,000,000,000.00 EQUALS .0008! THE EXACT AMOUNT OF THE RATE FOR THE LAST TWO YEARS! Again I argue that Iraq can and should have a much larger float backing it's currency than a measly 20 bilion dollars! This blows away the theory that the currency has remained stable!! How can it be unstable when obviously the market makers are keeping it pegged to the 20 billion backing it up!!! This defies economics 101!! A game has been played with the rate and the currency itself. Soon and very soon they are going to have to let the cat out of the bag and let it rise!!!

[BMWman]

BEFORE I RESPOND PLEASE MAKE CERTAIN AND READ THE LAST PARAGRAPH OF THIS POST!!!!!!

Thank The Lord!! Someone finally gets it!!! If the IMF and Iraq have any sense at all what BMWman posted is the route that has to be taken. kUDOS TO YOU BMWman!!!

RichNick123,

Thank you for your kind words. I appreciate it very much.

BMWman

This is true but does not change the amount of IQD's. When you exchange Dinars for dollars you can certainly destroy the notes but the obligation remains for the dinar debt. The money supply is made up with more than paper currency. If you move money to foreign reserves (instead of paper notes) the amount of money remains unchanged.

wgb52,

Umm. No. Reread my original post. You didn't understand what I wrote.

BMWman

[wgb52]

Sorry you are mistaken. I hold Dinar and I want a high RV, but your economics do not make sense. You cannot reduce the amount of money in circulation. You can take away the notes but the debt exists. It is just in a different form. Please remember that money is just a medium to exchange approximately equal values..you cannot make it disappear.

Further, if reserves are limited it limits the value of your currency. You need enough to support your peg. Kuwait is NOT a similar situation as Iraq has a 1000 times more currency in circulation now than when the war began. It is also a more stable economy. Go RV but remember money does not grow on trees. $.10 would be incredible!

BEFORE I RESPOND PLEASE MAKE CERTAIN AND READ THE LAST PARAGRAPH OF THIS POST!!!!!!

Thank The Lord!! Someone finally gets it!!! If the IMF and Iraq have any sense at all what BMWman posted is the route that has to be taken. kUDOS TO YOU BMWman!!!

In my essay I typed I assumed that this would be self explanatory but I reread my post and I did not expound upon this properly. I apoligize to everyone for not adding another paragraph and go into detail. I had it rolling around in my brain and as I was typing, in the middle of the night, I flagrantly forgot to go into detail.

My post was bringing out the fact that the Dinar is artifically being held at a complentely unrealistic value. Iraq cna easily match the funds that Kuwait has in (M1) exchangeable currency at roughly 88 billion USD. This alone would quadruple our investment. If Iraq only reduces the amount of Dinarby half with no revaluation we double our money. If they exchange the currency, in country, and those outside of Iraq cash out while reducing the (M1) simultaneously we could very well see the illusive 3.00+ rate.

The question I am seeking to find the answer for is this:

With the problem we have in translation and the shadowy answers we get it has been impossible to find factual evidence that Iraq is not including the lower denominations, that are not in circulation, in their 25 trillion balance.

Can everyone understand that Iraq had a new currency produced and issued in 2003? Are you telling me they went to the expense of having an entire countries currency denominated and printed and did not go ahead and print the smaller denominations at the same time? Any business owner understands the benefit of having your printing done at 1 time to lower costs even though you may not use all of it imediately. ie. Imagine you went to the trouble of printing 1 business card at a time instead of ordering 5,000. we all know the more you purchase the lower the price per unit!

With the way Iraq handles the rest of their business I would not put it past them to be adding the uncirculated notes into the 25 trillion balance. If someone can give me factual evidence otherwise I would be so very grateful! My thought is that they can RV now as I doubt seriously there are truly 25 trillion Dinar in circulation with onlly 20 billion in (M1) funds backing them!!

READ THIS!!!! 20,000,000,000.00 DIVIDED BY 25,000,000,000,000.00 EQUALS .0008! THE EXACT AMOUNT OF THE RATE FOR THE LAST TWO YEARS! Again I argue that Iraq can and should have a much larger float backing it's currency than a measly 20 bilion dollars! This blows away the theory that the currency has remained stable!! How can it be unstable when obviously the market makers are keeping it pegged to the 20 billion backing it up!!! This defies economics 101!! A game has been played with the rate and the currency itself. Soon and very soon they are going to have to let the cat out of the bag and let it rise!!!

[BMWman]

Sorry you are mistaken. I hold Dinar and I want a high RV, but your economics do not make sense. You cannot reduce the amount of money in circulation. You can take away the notes but the debt exists. It is just in a different form. Please remember that money is just a medium to exchange approximately equal values..you cannot make it disappear.

Further, if reserves are limited it limits the value of your currency. You need enough to support your peg. Kuwait is NOT a similar situation as Iraq has a 1000 times more currency in circulation now than when the war began. It is also a more stable economy. Go RV but remember money does not grow on trees. $.10 would be incredible!

wgb52,

Yes, you CAN reduce the amount of currency in circulation. Just like you can increase it. I don't know where you get the idea that you can't, but you are wrong. Do a little research on the way fiat currencies work. Read the Fed's publication called 'Modern Money Mechanics' and you will understand.

Modern Money Mechanics

page 6:

Bank Deposits - How They Expand or Contract

Let us assume that expansion in the money stock is desired by the Federal Reserve to achieve its policy objectives. One way the central bank can initiate such an expansion is through purchases of securities in the open market.

page 12:

How Open Market Sales Reduce bank Reserves and Deposits

Now suppose some reduction in the amount of money is desired. Normally this would reflect temporary or seasonal reductions in activity to be financed since, on a year-to-year basis, a growing economy needs at least some monetary expansion. Just as purchases of government securities by the Federal Reserve System can provide the basis for deposit expansion by adding to bank reserves, sales of securities by the Federal Reserve System reduce the money stock by absorbing bank reserves. The process is essentially the reverse of the expansion steps just described.

Money stock (supply) can be manipulated as the Fed desires. Again, from page 6: "Let us assume that expansion in the money stock is desired by the Federal Reserve to achieve its policy objectives."

Straight from the horse's mouth, sir.

And that is only ONE way to reduce the currency in circulation. There are others. Go read about what really caused the Great Depression. Bernanke is on video stating EXACTLY what/who caused it.

So, yes, currency amounts in circulation are reduced and increased as needed to produce their desired outcome.

By the way, do you know who owes who the debt that is represented by the note?

BMWman

[wgb52]

Guess I will never get it. I always felt that when the govt sells securities it reduces the money supply UNTIL it has to redeem them.

wgb52,

Yes, you CAN reduce the amount of currency in circulation. Just like you can increase it. I don't know where you get the idea that you can't, but you are wrong. Do a little research on the way fiat currencies work. Read the Fed's publication called 'Modern Money Mechanics' and you will understand.

Modern Money Mechanics

page 6:

Bank Deposits - How They Expand or Contract

Let us assume that expansion in the money stock is desired by the Federal Reserve to achieve its policy objectives. One way the central bank can initiate such an expansion is through purchases of securities in the open market.

page 12:

How Open Market Sales Reduce bank Reserves and Deposits

Now suppose some reduction in the amount of money is desired. Normally this would reflect temporary or seasonal reductions in activity to be financed since, on a year-to-year basis, a growing economy needs at least some monetary expansion. Just as purchases of government securities by the Federal Reserve System can provide the basis for deposit expansion by adding to bank reserves, sales of securities by the Federal Reserve System reduce the money stock by absorbing bank reserves. The process is essentially the reverse of the expansion steps just described.

Money stock (supply) can be manipulated as the Fed desires. Again, from page 6: "Let us assume that expansion in the money stock is desired by the Federal Reserve to achieve its policy objectives."

Straight from the horse's mouth, sir.

And that is only ONE way to reduce the currency in circulation. There are others. Go read about what really caused the Great Depression. Bernanke is on video stating EXACTLY what/who caused it.

So, yes, currency amounts in circulation are reduced and increased as needed to produce their desired outcome.

By the way, do you know who owes who the debt that is represented by the note?

BMWman

[BMWman]

Guess I will never get it. I always felt that when the govt sells securities it reduces the money supply UNTIL it has to redeem them.

wgb52,

You'll get it. Just keep reading. If you want to read one book that explains it all really well, I would recommend 'The Creature From Jekyll Island' by G. Edward Griffin. Here is his website: http://gedwardgriffin.com/

If you read this book you will understand what the fiat money system really is and how it works.

Blessings and Truth to you, sir.

BMWman

[RichNick123]

WB and BMW,

Correct me if I am wrong here, My summation is that Iraq is not operating as a Fiat currency but instead is actually pegged to the 20 billion dollars they have in reserve. For a currency to not move at all in 2 years, ok it has fluctuated in the past couple of weeks from 1170 to 1000 on some trades outside of the CBI sale record, It absolutely has to be pegged to a reserve.

If I am interpreting this incorrectly then correct my incorrect interpretation. Thank You So Very Much!

[BMWman]

WB and BMW,

Correct me if I am wrong here, My summation is that Iraq is not operating as a Fiat currency but instead is actually pegged to the 20 billion dollars they have in reserve. For a currency to not move at all in 2 years, ok it has fluctuated in the past couple of weeks from 1170 to 1000 on some trades outside of the CBI sale record, It absolutely has to be pegged to a reserve.

If I am interpreting this incorrectly then correct my incorrect interpretation. Thank You So Very Much!

RichNick123,

If the Dinar is backed by Dollars (amount doesn't matter), and the Dollar is a fiat currency, then what backs the Dinar? Nothing. Because the Dollar is nothing (fiat). You can't back something (IQD) with something (USD) that is backed by nothing.

It is pegged to the Dollar now only because the Dollar is currently the world's "standard currency".

For a currency NOT to be fiat it doesn't just have to be backed by something, it needs to be convertible. ie, We used to have silver certificates. You could take that silver certificate to the bank and ask for the silver and they would legally have to give it to you. The certificate simply represented the silver that was stored somewhere and you could convert it at anytime. It was easier to carry than the actual silver. That's the only good reason to have "paper money"; easier to carry/use.

The reason that Iraq's currency's value hasn't moved is because the IMF has determined it to be so. The IMF pegged it there and, I believe, will soon peg it at a much higher value!

All currencies in the world right now are fiat, since the Swiss pulled the Franc off of the gold standard in 2000. That was the last hope but, that is now gone too.

BMWman

[hopefullbk]

wgb52,

Yes, you CAN reduce the amount of currency in circulation. Just like you can increase it. I don't know where you get the idea that you can't, but you are wrong. Do a little research on the way fiat currencies work. Read the Fed's publication called 'Modern Money Mechanics' and you will understand.

Modern Money Mechanics

page 6:

Bank Deposits - How They Expand or Contract

Let us assume that expansion in the money stock is desired by the Federal Reserve to achieve its policy objectives. One way the central bank can initiate such an expansion is through purchases of securities in the open market.

page 12:

How Open Market Sales Reduce bank Reserves and Deposits

Now suppose some reduction in the amount of money is desired. Normally this would reflect temporary or seasonal reductions in activity to be financed since, on a year-to-year basis, a growing economy needs at least some monetary expansion. Just as purchases of government securities by the Federal Reserve System can provide the basis for deposit expansion by adding to bank reserves, sales of securities by the Federal Reserve System reduce the money stock by absorbing bank reserves. The process is essentially the reverse of the expansion steps just described.

Money stock (supply) can be manipulated as the Fed desires. Again, from page 6: "Let us assume that expansion in the money stock is desired by the Federal Reserve to achieve its policy objectives."

Straight from the horse's mouth, sir.

And that is only ONE way to reduce the currency in circulation. There are others. Go read about what really caused the Great Depression. Bernanke is on video stating EXACTLY what/who caused it.

So, yes, currency amounts in circulation are reduced and increased as needed to produce their desired outcome.

By the way, do you know who owes who the debt that is represented by the note?

BMWman

BMWman and WBG52, I just watned to take a minute and thank you both for that cival discourse. That was potentially the most informative dialog I have seen in a while relative to currency. Not picking a side as I have a TON to learn but both opinions have certainly begun to help me bridge a large knowledge and understanding gap. thanks to both of you for taking the time to be clear and concise! It's greatly appreciated.

[wgb52]

I was mistaken, but fortunately I have also learned alot. I've been reading "The Creature from Jekyll Island" (almost done) fascinating reading about the Fed reserve and fiat money.

[commtrd]

BMWman is absolutely correct. BTW "The Creature From Jekyll Island" is a fascinating read as well as recommended for all Americans. It is a huge thick book though so it takes a long time to get through it.

[BMWman]

I was mistaken, but fortunately I have also learned alot. I've been reading "The Creature from Jekyll Island" (almost done) fascinating reading about the Fed reserve and fiat money.

wgb52,

You rock, man!!!! Seriously. Do you know how many of the people that I have recommended that book to have actually read it? VERY FEW. You show a lot of class and character by going toward the truth. Putting aside what you have been taught is 'correct' and digging to find what is really going on. I commend you sir!

Most people are too damn lazy to do some research on their own. I have had a very spiritually challenging day and you have encouraged me a lot. Thank you, and may God bless you.

BMWman

BMWman is absolutely correct. BTW "The Creature From Jekyll Island" is a fascinating read as well as recommended for all Americans. It is a huge thick book though so it takes a long time to get through it.

commtrd,

I agree 100%. The Creature is a great read.

BMWman

[BMWman]

BMWman and WBG52, I just watned to take a minute and thank you both for that cival discourse. That was potentially the most informative dialog I have seen in a while relative to currency. Not picking a side as I have a TON to learn but both opinions have certainly begun to help me bridge a large knowledge and understanding gap. thanks to both of you for taking the time to be clear and concise! It's greatly appreciated.

hopefullbk,

You are welcome. It's always good to discuss something with someone who is willing to learn. And wbg52 is someone I now have a lot of respect for. I always try to be open to gain knowledge from anyone. Believe me, I have been taught a lot by 18 month old children and by 90 year olds. Lessons in life are all around us if we will but ask God to teach us.

As I have done before, I would recommend 'The Creature From Jekyll Island' by G. Edward Griffin. His website is: www.gedwardgriffin.com.

That's a good start. After that you could read 'Credit . . . Is . . . Debt . . . Is $lavery ' by Bruce G. McCarthy. You can find it here: http://home.earthlink.net/~cadman777/credit_debt_slavery.htm.

There is a lot of info out there to read. I have a reading list a mile long that I want to get to...if I just didn't have to work everyday ...

BMWman

Edited November 18, 2010 by BMWman

[hopefullbk]

hopefullbk,

You are welcome. It's always good to discuss something with someone who is willing to learn. And wbg52 is someone I now have a lot of respect for. I always try to be open to gain knowledge from anyone. Believe me, I have been taught a lot by 18 month old children and by 90 year olds. Lessons in life are all around us if we will but ask God to teach us.

As I have done before, I would recommend 'The Creature From Jekyll Island' by G. Edward Griffin. His website is: www.gedwardgriffin.com.

That's a good start. After that you could read 'Credit . . . Is . . . Debt . . . Is $lavery ' by Bruce G. McCarthy. You can find it here: http://home.earthlink.net/~cadman777/credit_debt_slavery.htm.

There is a lot of info out there to read. I have a reading list a mile long that I want to get to...if I just didn't have to work everyday ...

BMWman

The first thing I did after reading the discussion between the two of you was ask my wife to get it for me next time she orders more reading material. She orders books monthly so I will soon be sinking my teeth into it. I wish most of the chat were like that. You both seem to be very sharp in economics, there was no BS, just educated discussion! Thanks again too the both of you.