Where is all the dinar coming from?

[FoRgiVeN OnE]

If Iraq is trying to get all the big notes back in house, then how can the dealers be selling billions a week. Isn't this defeating the purpose on getting a hold of their money going into circulation? Just curious. Any reply is welcome... Yes.. even bashing.

[Nani?]

If Iraq is trying to get all the big notes back in house, then how can the dealers be selling billions a week. Isnt this defeating the purpose on getting a hold of their money going into circulation? Just courious. Any reply is welcome... Yes.. even bashing.

Good question... it does seem like they would be chasing their tails.

[Econman33]

Just a thought. Maybe they are pulling in all in-country big bills so they don't get out of country.

[virginialadybug]

Just a thought. Maybe they are pulling in all in-country big bills so they don't get out of country.

Then why would they be giving them to dinar dealers to sell out of country?

[Bandito]

The dealers more than likely bought a huge inventory of IQD, before the CBI stopped auctioning them. IMO I still find it hard to believe the dealers are selling "billions" each week...I think that is pumper sales talk.

[virginialadybug]

I would love to hear from an economist on how the dealers are getting large notes to sell when Iraq wants them back in the country.

[duty.rec]

There doesn’t seem to be any shortage of big bills at the money exchange counters here in Kuwait City.

One Million IQD is on sale at 240KD which converts to about $850

How does that compare.

Would the dealers be going this route?

[marknet73]

I wish I knew the answer to that. A fairly large percentage of the big bills have already been brought back from circulation. I guess overall, the billions (if that's true) being bought and sold by dealers is a fairly small percentage of the trillions that exist. I'm sure the dealers and the Iraqi banks where the dealers are getting their dinars from are all making a nice profit just like they'll all make $ on the spread if there's an RV and we cash in our big bills. We cash in at x amount and the CBI sells at a 10 cent profit. The 25K notes we cashed in are kept out and the new smaller denoms are released. If they don't come out with too high of a rate I'm sure more people will be investing, realizing that it's still undervalued, and the cycle will continue. So maybe they're waiting until after the RV to get the remainder of the large notes out of circulation. Makes the most sense to me.

Edited December 25, 2010 by marknet73

[jmw]

I wish I knew the answer to that. A fairly large percentage of the big bills have already been brought back from circulation. I guess overall, the billions (if that's true) being bought and sold by dealers is a fairly small percentage of the trillions that exist. I'm sure the dealers and the Iraqi banks where the dealers are getting their dinars from are all making a nice profit just like they'll all make $ on the spread if there's an RV and we cash in our big bills. We cash in at x amount and the CBI sells at a 10 cent profit. The 25K notes we cashed in are kept out and the new smaller denoms are released. If they don't come out with too high of a rate I'm sure more people will be investing, realizing that it's still undervalued, and the cycle will continue. So maybe they're waiting until after the RV to get the remainder of the large notes out of circulation. Makes the most sense to me.

Just curious where you got that a large percentage have been brought in?...the only statement that i have seen stated a percentage of excess liquidity had been brought in...not a large percentage of circulation. The CBI buys dinar back at the auctions then turns around and sells them through dealers...it helps maintain the value of the dinar and brings in money to the CBI.

Edited December 25, 2010 by jmw

[smee2]

I have done all my dinar buying from a Canadian company, being Canadian myself, and living in Canada..

I became friends with the dealer and we have had some great conversations on the phone. I asked once about the notes and where they were shipped from, being in an area where there is rarely next day courier service, and a two day service is the best you can really expect. She told me that up to a certain denomination the bills were already in country, and shipped from her location in Montreal PQ. Sometimes they would be short enough to have to hold an order a day or two for incoming supply. But anything over a certain denomination, and I wish I could remember that exact dividing line, was not shipped from Canada, but from Amman, Jordan. The credit card information is all to a company in Amman, Jordan, no matter which denomination I ordered. The only difference I could see was that the lower of the denominations, the ones that are shipped from Canada, were all uncirculated. Whereas the larger denominations, the ones coming from Jordan were all used but in such excellent condition you would not know they had been used.

I don't know if this helps to shed any light on the situaiton, but it is what I have to offer.

smee2

[marknet73]

Just curious where you got that a large percentage have been brought in?...the only statement that i have seen stated a percentage of excess liquidity had been brought in...not a large percentage of circulation. The CBI buys dinar back at the auctions then turns around and sells them through dealers...it helps maintain the value of the dinar and brings in money to the CBI.

I was basing that on the Marcus Curtis post from a while back that stated this.

"between 75 and 90% of this 25 Trillion have been removed or have been set up as “Basket Currencies”. Basket currencies are holdings by foreign countries that is used to stabilize their own currency (originally the USD was backed by Gold now it is Fiat Currency (un-backed). There is currently a movement to return this backing using other currencies….. Could the Dinar be one of those currencies???"

I don't think there's any way to know the exact amount for certain that's been brought in. If we did I think this whole equation might become a little clearer. Thanx for the info!

[djwebby]

If Iraq is trying to get all the big notes back in house, then how can the dealers be selling billions a week. Isn't this defeating the purpose on getting a hold of their money going into circulation? Just curious. Any reply is welcome... Yes.. even bashing.

How exactly do you know that they are selling 'billions' each week?? Do you actually know how much each trader is selling/has sold..........