Iraqi Dinar Redenomination and Exchangeability

[BradleyB123]

OK so I just registered for this website because I have been hearing a ton of hype from my Mother-in-law about the Iraqi Dinar and the Revaluation. She told me that her source told her Iraq will be issuing lower denomination bills. I have no idea what that means for the RV process so I would like to get some feedback. As soon as she told me I googled it and found this website...I have no idea if it was posted before so I apologize in advance if that is the case. I couldn't find a date on the site so I don't know... Let me know what you think...

Iraqi Dinar Redenomination and Exchangeability

There have been a tremendous number of inquiries about the recent news that Iraq will be increasing the value of their currency and, at the same time, introduce new denominations into the Iraqi economy sometime in 2010 (currently planned). Specifically, it has been reported that the Iraq Finance Minister issued a statement saying they have prepared a plan to increase the value of the Dinar against the dollar and will introduce 25, 10, 5, 1, 1/2, ¼, and smaller (possibly 1/10 or 1/20) Dinar banknotes and/or coins. He said that successful fiscal policies pursued in Iraq have contributed to increasing the value of the Iraqi Dinar against the dollar, noting that the U.S. Dollar dropped significantly in value during the current year. Of note, he also said in a press statement that the bank has been following with great interest the phenomenon of low demand for the U.S. Dollar in the local Iraqi currency exchange markets.

Mudhhir Muhammad Salih, a member of a Central Bank advisory panel, said by the end of 2010, new banknotes will be fully introduced while the current banknotes will be gradually removed from circulation. He did not specify when the new banknotes would be issued. Both (current and new) denominations will be legal tender in Iraq until the current banknotes are completely withdrawn over a period of time.

Economic analyst Hilal al-Tahhan was quoted as saying, “The bank's move is overdue.” He said he expects the currency change to go smoothly because of the decision to allow both the current and new banknotes to coexist during an extended exchange period, leading to less turbulence in the economy.

What does all this mean? Overall, this news appears to be very positive and possibly points to some significant changes in the value of the Iraqi Dinar. It has long been the opinion of many Iraqi Dinar investors that the Iraqi Government must introduce new lower denominations into their economy before the value of their currency increases. If the value (buying power) of the dinar increases significantly or rapidly, the larger denominations currently in circulation would be impractical for use during everyday transactions in the Iraqi economy. If the Iraqi Dinar increased in value to 10 cents (.1 USD), the smallest banknote in Iraqi would have a value of $5 USD. There would no practical way to purchase everyday items in the economy and no way to make change---the currency would be impractical and unusable. If a soda in Iraq has a value of 50 cents now, it will still have a value of 50 cents if the value of the Dinar increases, and there has to be a denomination in the Iraq economy to pay for it. The current problem is that Iraq doesn’t have any currency in circulation to pay for normal day-to-day products if the Dinar rises significantly in value, so Iraq must have smaller denominations moving forward.

Also from the recent news, it appears as though all denominations (current and soon to be issued) will be in circulation at the same time and no immediate exchange will be necessary. Hopefully, the Iraqi Dinar will be on the world exchange market soon to allow for even easier exchange in the near future. Expectations are that Iraq is moving as fast as they can to rebuild their economy and wealth, and join the international economic community.

There have also been rumors about the future exchangeable value of some current Iraqi banknote denominations, and limited time periods for exchange of current Iraqi banknotes. It has been falsely rumored that perhaps the 25,000 Dinar banknote will be exchanged at a different exchange rate than current smaller Iraqi banknotes. Another false rumor suggests there will be a very short period (days or weeks) of exchange for the current Iraqi banknotes after a significant change of value and introduction of lower denominations.

To address these rumors, let’s look at currency from a basic level: Countries issue their own currency. They issue their currency with a responsibility to honor it and redeem it. The currency must be accounted for. When a country issues currency (the US as an example), they borrow against the currency and issue debt to support it. The U.S. recently printed a significant amount of currency in order to finance stimulus funding. In order to do this, the U.S. government had to borrow the money with an obligation to pay it back.

One of the main functions of the U.S. Treasury Department is to manage the U.S. national debt (the amount of money which the federal government owes to its creditors). China owns much of our debt as do U.S. citizens and other countries---we must honor our issued currency and our debt. If a country doesn’t honor its debt, creditors (other countries and investors) lose faith in the defaulting country and a country will end up in financial ruins. Iraq, as a responsible member of the world economic community with a goal of getting their currency online with the rest of the world currencies, has issued currency with an obligation to honor it----all of it---not just certain denominations. Throughout modern history, there has not been one instance where a country honored some denominations, but not others. If certain denominations were not valued, people and other countries would lose faith in that country's responsibility to respect their debt and honor their issued currency. If a nation only valued certain denominations, who would trade with them, exchange with them, or conduct business with them? To limit the time period for currency exchange in order to force the de-valuation of currency in circulation in order to reduce debt doesn't happen and wouldn't be tolerated by the world financial community. Countries have to be accountable for all of their currency and they can't play games with exchange timelines to try and prevent people for exchanging. Remember, in addition to individual investors, large governments and banks outside of Iraq hold Iraqi currency. Money from all over the world has flowed into Iraq through the purchase of Iraqi Dinar. The Iraqi Government will honor that investment in their economy, or there will never be faith in their economy and they will never be accepted by the world financial community.

DinarBanker.com owns a tremendous amount of Iraqi Dinar---we buy (any denominations) and sell our Dinar. We see the introduction of the new lower denominations as a very positive sign. Furthermore, we expect to continue to trade the Iraqi Dinar no matter what happens to the value of it in the future. With our extremely large capitalization, we are prepared for any value changes in the Iraqi Dinar and do not expect any exchange restrictions in the future or short time limits for exchange.

http://www.dinarbanker.com/information-articles/iraqi-dinar-redenomination-and-exchangeability.html

[Nani?]

that's alot to say for a newbie... I don't want to take the time to read it

[pops]

Good first post even if it does come from a dealer. I hope their info is on track and welcome to DV.

[rsskelton]

Geeezzz........ Take a breath Bradley.

[Maynard57]

Bradley,

Great post. I think if you hang on the basic concepts with currency in general, it will keep you grounded to the extent you can decide for yourself what to believe and what to take with a grain of 'sand'

Welcome, greetings and salutations,

Maynard

[BradleyB123]

I read the article....copy and pasted it...NO, I did not take the entire time to write all that. I just thought it could possibly be great news and wanted to get some feedback from everybody...

[hammy]

First, welcome Bradley. 2nd I went to dinarbank link and read their latest news section. Don't shoot me but if he states that he has resent news of the other denominations being issued and circulated don't you think that he would post that article in his "News" section. I see nothing there. I read a lot of news sites everyday, approximately 12, and 4 Iraqi newspapers online. I try to only post news on, Oil - Politics - Dinar (if any) - Economy. I have not seen anything even printed or talked about in respect of the "dinar" for a while.

Edit: Nani? do you ever have anything nice to say?

Edited January 15, 2011 by hammy

[Silverdinar]

Well Hello Bradley, man that's a mouth full... good copy & paste job....Don't necessarily believe it all, but welcome to post jouranlism.. Now go back and do some more research..then come back with the facts...Go RV !!!

[Hrkal]

Bradley, welcome to the Vets where everything is vetted in manner similar to our political system. There are 2 sides here and if you tilt one way, you will be hammered. Also, if you ask to many questions that others think they are beyond, they will hammer you to. Then there is the side of those that are always happy and positive. Nothing wrong with that but I feel this should be a place for discussion without personal attacks. Be careful, you can find yourself playing into things that you don's normally do.

As for your post, I will be honest, I did not read it all because I got to a point that you can catch up on whats going on here by reading in depth past and current posts. (A lot of the. Go back to 12-1-10 posts and get caught up. You will answer a ton of questions doing this. Then you will get some respect form those that are critical here. Frankly, I welcome you on to the ride!!! Be Blessed

[debunker]

Pump pump pump it up! At least this guy is honest about his pumping though...thats new.

All the best for an RV!!

Debunker.

[NICKS]

Waste of a post....

[stephen]

Most of what you are saying has been posted at one time or another for the last year or more

[tykmoore]

that's alot to say for a newbie... I don't want to take the time to read it

I had to give you a + cause I was thinking the same thing that was a long Post.

[terr]

Dealer..pumper, but thank you for this post.

[BradleyB123]

Dealer..pumper, but thank you for this post.

Dealer?? Pumper?? Come on now, I'm just a dude from Wisconsin who has heard certain things, and asked some questions dealing with a particular subject. This is a forum, correct? I'm hoping this RV happens any minute. I guess I'm pretty pumped about it...does that make me a pumper?? Hmmmm...

[dflake]

BradleyB123

OK, I will get slammed for this, but I consider myself tougher than words. First off, welcome to DV, a better IQD info site you will be hard pressed to find. News comes in timely and accurately, there are a couple members that seem to have a knack for understanding this investment, you will learn who they are, and form your own opinion. Just be sure to keep that opinion to yourself. For the most part, if it is not on a positive note, no one here wants to hear it or discuss it, you will get bashed, as you can see already. I personally do not submit my opinions any more, I tend to like to look at both sides and everything in between concerning this investment, unfortunately, not all that is upbeat so, well, just hang out awhile you'll see what I mean. I have backed off to mostly lurking in the chat room and posting news articles. I still stay abreast with current happenings, without rocking anyone's boat, bursting anyone's bubble or ruining anyone's fantasy. Again, I say this is the best IQD site on the web to keep up with what is happening. Welcome, hang out, hang on and learn.

All done, meat counter is open. Bash away!

[diligent1]

dflake - Good Post...and quite accurate. I have been watching from a-far for quite a long time....New to the site but not to the politics or investments so the newbie label could apply depending on perspective.

As much as I would like sharing new ideas and thoughs, I do not believe there is a receptive forum out there anymore for that. Not bashing....just is the way it is.

bradley - "Hang on" is the perfect metaphor for a number of reasons that you will quickly discover. Welcome, and do not be discouraged.

Everyone else - We all have a shared interest and can benefit greatly from the knowledge of many as there are great minds here. Everyone got onto this ride at a

different place and time, and from different walks of life. May we forever remember the heavy price. Know that we are reaching critical mass and chaos wants in.

Keep doing what we are doing....stay the course....and keep your foot in it down the straightaway....just a few more laps.

I wish everyone the best and with Gods speed.

Peace.

[saslas]

BradleyB123, I am a newbie also, Some people are rude with their answers and I personally think they should take into account that we are newbies and have not been around long enough to know all that the ones that have been here awhile do. I think you were trying to be nice and post something that those of us that have not been here but for a couple of days would like to read about. Don't get discouraged with those who are a little rude with their answers, just consider the source and do what you feel you want to. Just my opinion, take it for what it's worth. I don't know much about all of this but am trying to learn. The only way I know to learn is to read what people post and then take it with a grain of salt. You know what I mean?? Just have to laugh about it all!!!!

[saslas]

I agree with you diligent1, Thanks for the encouragement for BradleyB123 and if you don't mind, I will take it too!!!! I wish everyone the best also!!! It is good to hear from someone who is encouraging and not putting us down!!

Thanks again,

Sassylassie

[Uncle Barkie]

Don't sweat the bashers ... they were abused children ! ... Just as Maynard and others have said , just look, listen, read and learn , and you'll be fine . Many people on here type tough , but are merely lashing out because of their own doubts. Just be true to yourself , stay positive and focused, and most of all , be realistic with your expectations from this investment and you'll be fine .

Welcome to Dinar Vets !!!

Uncle Barkie

[Hope Floats.Rates Dont]

and with that said...remember vets (not that I am one yet), just because someone is a "newbie" doesn't mean they are a stupid, uneducated, unreliable source. Many of us have watched the "investment" and these sights from the beginning. We are educated and well spoken individuals with our own experiences and merits that very well could add to your precious sight. Some of us have read here for months and simply not registered our "2-cents" worth. Some of us simply want to only provide some positivity to a (sadly said) quickly negative growing blog. Keep your heads up, we all knew this was risky, pie-in-the-sky and quite frankly, a little silly at times. We are all here together and can learn alot, maybe only to seperate truth from fiction (pumping, etc), but do this in a humane and non-bashing and name-calling way. Listen to what you heed, disregard the rest...quietly...or risk losing your reputation (all over, I might add) as the best and most "sane" dinar sight around. Thanks

[izzynator]

Just wanted to say that I too am a newcomer on this site but I've been sitting on my investment since my first trip over there in 04. I 've kept track of this over the last 7 years because I knew it was a long term waiting game. Any how during past few years DINARVETS has poped up constantly and I've come to consider it a reliable source of info. So to Bradley I say; I think we're in good hands here.

P.S.

I know I should have registered long ago but it seems things are now starting to happen. So to the senior members and folks who run the site thank you for being straight shooters. Ok I'll hush up now

Izzy

[jimmey309]

Your reasons for joining are your own.

Understand as a dealer, your motives

are understandably questioned as this is

Adam Montana's site

and it is very conceivable that you may be

trying to cash in on Adam's success.

May be not.

At least you had enough moxey to

declare that you are a dealer.

Everyone joins for different reasons.

The people on this site are positive

thinkers for the most part.

Also, we all have a common goal

and a common hope.

We wake up every morning with

the hope that our lives may change today.

As well as the possibility that it could.

Many people have this hope but

are not involved in a realistic chance / opportunity

to get there.

Harder to realize this hope

without a realistic scenario

to get you there.

There is also a certain comradarie

that I feel sometimes.

Not all the time, but often.

I talk to the people on this site.

They are positive individuals

trying to move forward with their

lives for the most part IMHO.

I can name some but that is not

the purpose of this post.

This site is pretty tolerant

of differing views on this investment

IMHO as well.

Adam is an optimist as well.

iMHO he tries to temper his optimism

with facts and judgement.

Sometimes I feel like there are

too many posts on the Ponzi level.

Some of those posts are just

people who are optimistic.

I have my own personal beliefs

as to what will propogate the IQD

to revisit a higher valuation.

For me, this investment is interesting,

intriguing, fun, and engaging

alot of the time.

For a number of reasons,

I am a member.

And I have not even mentioned

the benefits of being a VIP

or an OSI participant.

Positive people beget positive results.

So do hard - working people

when they move / act / work together.

And for all appearances sake,

Adam seems to work hard to me.

[Mudster]

Bradley- welcome to the site. Thanks for the post. As someone stated earlier, posting something of that extent or with any negativity will get you bashed..a lot. This is because everyone has their reasons for being here. Some like to learn. Some like to teach. Some like to praise. Many like to bash, though. This is because it's the cowards ultimate reward. They can sit from the safety of their computer chair and say whatever they want to someone without any chance of physical ramifications, and this gives them a feeling of false empowerment that helps cover up their real life shortcomings. Anyways, welcome.

[ChrisA70]

I don't even bother answering back to the NON newbies. Lots of rude smartass remarks on this site. I mostly read and don't post. I have been learning a lot here though. Seems like a lot angry, impatient, "seasoned members".....

I always thought "gee at one time weren't we all newbies?"

Edited January 16, 2011 by ChrisA70