CBI Currency Auction 3/10/2011

[Doc31]

Currency Auctions

Announcement No. (1852)

The latest daily currency auction was held in the Central Bank of Iraq on the 10-MAR-2011.

The results were as follows:

DetailsNotesNumber of banks15

Auction price selling dinar / US$1170

Auction price buying dinar / US$-----

Amount sold at auction price (US$)165,254,000

Amount purchased at Auction price (US$)-----

Total offers for buying (US$)165,254,000

Total offers for selling (US$)-----

Exchange rates

Dollar's exchange rates / in Baghdad markets

Oil is off a bit from Tuesdays highs but still extremely painful at the pump

Gold rolling downhill presently after running in a two day channel

Zeroes ... near ... with cash accounting for 2.09M or 1.26% of the total

I just sent my group last night's KTFM post. Tuesday's was very cryptic ... Wednesday he said that only the newbies would have a hard time understanding Tuesday's post. Not so. Wednesday's is a bit of a tease for Thursday's chat ... it did answer some questions ... but it was a tease. Now most of you know that I am indeed a fan of Frank26 but I'm going to complain just a bit this morning ... you see he has asked members listening to the Thursday chat NOT to post what was said.

Here's my problem with that ... when I had lots of time I spent it scouring the news/net for info about the IQD RI/RV ... as does he ... hours and hours ... but when my wife comes home ... I'm not spending 30 minutes on a chat much less 1.5-2 hrs (or more) ... just not happening ... my relationship with my wife (next to God) is the most important thing in my life! I'm banking the time with her!

Traditionally (Monday chat is still transcribed), I would read a transcript the next morning (thankful to those who recorded and transcribed) and I could cover it in 15-20 minutes tops ... and remain apprised of where his team was regarding intel/info/supposition etc. ... and I value that. And NO ... I'm not blasting or taking a shot at Frank26, his team, or KTFM ... as I appreciate them and their work immensely. I just think that this is a policy that they didn't think through completely. It might raise participation numbers, set records or whatever ... in practice it is counter productive for those of us serious about trying to stay on top of Iraq/IQD AND put our family above our investment. That said I would really appreciate it if that were to change ... as would the "hard core" portion of my group!

OK ... enough of that ... I saw some requests for me and so forth the last couple of days ... the truth is this ... I didn't think I had anything to say that ADDS anything ... so I didn't! That's all. If I spend the time to do this I want to contribute in some way ... I hate it when my time is wasted ... I don't want to waste anyone else's.

And ... the news the last two days (with a couple of exceptions mostly posted later in the day) just seemed like section B C D and even F of the local paper ... do you know what I mean? Nothing worthy of front page ... even on section B! They just didn't seem to be worth commenting on. Then almost simultaneously ... every bit of intel I had coming on three different fronts dried up! I know ... makes you wanna' go hmmmmmmmmm ... doesn't it?

Let me look at this mornings news ... whoaaaaaaaaa ... that was scary ... I clicked the wrong button and ended up in the rumor section ... narrowly escaped ... OMGosh, you really need flame retardant underwear in there!

Let me try again ...

OK now that I have voiced my displeasure with not posting the Thursday CC I'm going to quote Frank26 and his team (I told you ... I like and appreciate them ... they just made a decision without thinking it out completely ... that's all). Frank26 and his team pointed out that al-Maliki is busy playing the clown doing everything he can to get your attention and draw it away from Shabibi (whom you haven't seen in a long while), the USTreasury reps, and the CBI ... and this mornings news would bear that out ... (he also said that when you see Shabibi again ... it will be time to do some serious praising and thanking!)

A source reveals that al-Maliki will not submit candidates for the ministries of security today because of the many differences between his and blocks

Al-Maliki establishes a new dictatorship. The government accused of deception on the same بالاستحواذ on public property

Al-Maliki Demands the parliament more powers to remove ... and the list goes on.

This one was voiced by one in my group as a huge problem ... Major oil pipeline sabotaged by insurgents ... I agree that it isn't optimum but it only transfers 1/4 of their exports ... additionally, I believe that it is one of three that they have (one through Syria and one to Basra) ... and will probably drive the price of oil up and possibly cover their loss of delivery by means of price. To me it speaks more to the fact that al-Maliki does need to "crap or get off the pot" ... just sayin'!

Started to get all excited about this one ... The Central Bank of Iraq: Iraq, succeeded in providing a cover of foreign currency ... turns out it's another Mohammed Saleh article ... repeat don't believe until corroborated elsewhere

Here's my favorite ... Deputy Prime Minister: Al-Maliki should resign if there is no response to the demonstrations.

No wait ... this is Iraqi Federal Court standstill about independent bodies

Oh ... Sam R. told me to give a shout-out to Alza C. ... hi Alza!

That's all that I have time for this morning but I don't see anything else (yet) worth talking about.

Peace to all

Doc31

[lechesuerte]

Thanks again Doc. There really doesn't seem like there is alot to comment about these days (I would expect more info from Iraq). Then when there is something of merit it comes from someone like our pal Saleh (might as well be smoke). Almost seems like a blackout or they are waiting for something. We can only hope it doesn't take too much longer. Keep it up Doc!

Edited March 10, 2011 by lechesuerte

[cw2]

Doc31

Thank you for all u do!

What are ur thoughts on the new banking regs?

cw2

Look up miracles come from above!!!!!!!!!!

[Teresa82]

Thanks DOC you're true blue friend.

[coldwarvet]

Good post, Doc. Thanks!

[dflake]

Thanks Doc31, always good to hear from you. Even if just to say "Good Day". Lets us all know your still with us. Don't know about others here and will not speak for them, but for me you are part of my daily routine, your post help me keep my flight feathers trimmed. Thanks again.

[ckh]

Ya know Doc, I've watched your posts, I appreciate the time you put into researching and compiling the info for us, (thank you!) I respect your opinions and analysis but now, I'm startin' to really like you because you honor your wife! Good Man!

[cardinal sin]

Ah, morning coffee with the Doc. Thank you for all you do!

[pchester]

Nice read Doc,enjoyed.

[Blessed4ever]

I very much appreciate the fact that you put God and your wife first...

All this RV stuff will be wonderful if and when it happens, but nevertheless, still pales in comparison to the 2 people mentioned above!

Thanks!

[Darin]

Doc... We missed you, well I missed reading your in-sight on the auctions.

I've noticed a trend that Sunday auctions always tend to be rather low. Mondays & Tuesdays seem to increase and stay consistent throughout the week.

I would assume a lot of that has to do with possibly other banks being available?

I recall driving by a gas-station where I last filled up for at $3.44... Since than, it actually dropped (Go figure, right?) but I can't remember the exact value but it was under $3.40...

Stabilizing??? Did we hit our peak for the moment?? IMO, I believe crude may slowly drop in the near future until it hits that stabilized point and increases again due to summer demand.

2 weeks ago.. The demonstrations seemed to have more unrest in comparisson to a week ago.

1 week ago.. The demonstrations seemed to be more peaceful as it was just to notify the Govt. of demands

I believe the unrest on Fridays will continue... But I believe tom. as a prediction it'll be somewhere between more unrest than last week, but not as bad as 2 weeks ago.

(Speculative thinking: protestors handed in their demands and gave a more peaceful protest and it seems the GOI went back to drag-feet mode... I think they'll want to light that fire again to get them to expedite improvement of services, since if the protestors get soft the GOI gets lazy).

Rumors: They tend to be a daily occurance.... Some are more creative, some are blatantly crazy, some are grounded & reasonable. With all that said, I think the creative ones are just incorrect speculations that get lost in translation which end up in the forums not being entirely true. Anyone who has a vested interest within the M.E. will likely always have a optimistic/positive speculation. (It can be hard to stay grounded when sometimes the information we receive always seems positive).

-- And sometimes, we turn negative information into a relative positive outcome (See recent treasury laws, amendments to dealer cash-outs, and so forth).

[caz1104]

Doc,thanks for your post & comments. Spending quality time with family & your God was the best part of your post imo......................................GO RV 2011 BABY!!!!

[jimpickles]

thanks for outstanding consistant information !

[Slaydadea]

Welcome back Doc. Glad your feeling better. I'm honored as we all should be for your hard work. I've been right busy and am a bit behind. Thanks much! I Grabbed this statement. It says it all.

Doc, "my relationship with my wife (next to God) is the most important thing in my life! I'm banking the time with her"!

[drox]

Hey Yosemite Sam... You have come a long way from "Thanks for the post" days! This was a 2-cupper premium roast post for me. That's part of my new grading scale for you. (Length of post and quality). Don't get too excited because I have seen you have a few Sanka in a Dixie cup days here and there. Know what I mean?

OBTW... (Shh! Just 'tween us fella's) Are you sure wifey didn't switch you secretly to Double Caf instead of Half caf or sumthin? You sure seem to be sending her out a number of passionate electronic kissywinks a lot more lately as your posts get longer. You old frisky dog. I think she is definitely making the coffee these days, huh? Think back... when you're in the kitchen and she is making the Joe... does she say hey honey whats that over there as she points to the opposite wall a lot? (She's spiking it bro with that sweety pie powder). Probably something she saw or purchased from Oprah. That group is as secretive as the Free Masons and they are always getting us dudes to do stuff we didn't know we should be doing. And... making us feel good about doing it. It's a conspiracy I tell ya. Know what I mean doc?

Well tell her I said hey so she doesn't get suspicious. (psst... talk to ya later)

D!

Edited March 10, 2011 by drox

[sheepdog]

Doc 31, I'm fairly new on these sties. I appreciate what you write and look forward to reading all your posts. Thank you

[Bobbydee]

All good men have a great woman behind them backing them all the way. Doc you are a good man. Thanks for all your hard work. God Bless Semper Fi

[gp49]

Thanks Doc for your wisdom and kindness. Thanks for leading us to the Light. I don't write too much but I just want you to know how much you are appreciated and how much you are missed.

Blessings to you and your family

I don't know much about Frank26 and his team but I do like reading their stuff and what I have read from them seems to be from the heart. I get tired of people bashing them instead of just choosing not to read their stuff. Thanks for being kind to them.

[roux]

I, like many others, always look for your posts and enjoy reading them. Thanks for all you do and the man you are (valuing wife and God above dinar).

[Doc31]

Hey Yosemite Sam... You have come a long way from "Thanks for the post" days! This was a 2-cupper premium roast post for me. That's part of my new grading scale for you. (Length of post and quality). Don't get too excited because I have seen you have a few Sanka in a Dixie cup days here and there. Know what I mean?

OBTW... (Shh! Just 'tween us fella's) Are you sure wifey didn't switch you secretly to Double Caf instead of Half caf or sumthin? You sure seem to be sending her out a number of passionate electronic kissywinks a lot more lately as your posts get longer. You old frisky dog. I think she is definitely making the coffee these days, huh? Think back... when you're in the kitchen and she is making the Joe... does she say hey honey whats that over there as she points to the opposite wall a lot? (She's spiking it bro with that sweety pie powder). Probably something she saw or purchased from Oprah. That group is as secretive as the Free Masons and they are always getting us dudes to do stuff we didn't know we should be doing. And... making us feel good about doing it. It's a conspiracy I tell ya. Know what I mean doc?

Well tell her I said hey so she doesn't get suspicious. (psst... talk to ya later)

D!

Oh my gosh ... Sanka in a dixie cup ... still wiping my eyes from that one ... too funny. Oprah and Free Masons almost in the same sentence ... that is the mark of a wordsmith!

Thanks for taking the time to compose that (gave you a "+" too) ... my wife will be howling with laughter!

Peace brother

Doc31

PS ... Thanks for the post! wink! wink!

[Doc31]

Oil falling at this hour $102.69

[lgraham]

Enoch8 wrote:

Had a couple requests to take a look at this article.....

This title is certainly interesting..... however, in digesting the content, "Why do I get the feeling, whoever was reporting on this seems to be afraid to really say anything?"

"The Central Bank of Iraq adviser said on Thursday that the bank has succeeded in providing financial cover for foreign currency in addition to that he managed the success of price stability of the Iraqi dinar."

This sounds like an answer to the article from yesterday, "Iraq-Business News: Iraq May Legislate on Currency Exchange"

My response to that article was that the banks seemed to be more concerned about liquidity and solvency, in the event of an RV, because by far the greatest cash flow in Iraq is foreign currency, I.E. USD and Euro, because they do not have but about $7 Trillion IQD in the whole country, unless they convert that liquidity, to digital.

Let's say, the Central Bank of Iraq system, has half of that, which is only about $3 Billion Dollars, based in IQD, and the remaining Stock and Quasi Stock is in USD, mostly. {I know, this is a very rough estimate, but my bet is this is pretty close....close enough for giving this example, anyway.}

The M2 is around $52 Billion, including all cash and digital, if I understand that right..... (could be off..... but again, good enough for this example.) Even if, Iraq is allowed 20% Fractional Reserve of the IQD, that means they can only support about $15 Billion USD worth of IQD, but have only $3 Billion USD worth of it to support that, (assuming they were able to digitize roughly 17 to 18 Trillion IQD), there are still 2 basic problems, they have.

1. IQD is not recognized internationally, so it would still have to be supported by USD, which is already being supported by the actual holdings of USD, which is also costing them a premium, for international transfers, because the IQD is not recognized. That alone represents a huge loss to the banks, in handling such transactions, as one would imagine, due to the premiums paid out to the larger international banks, for covering such activity.

2. The IQD held, does not hold any value of it's own, so the liquidity backed by IQD, is not valid outside of Iraq. If it were to become recognized, it would solve the first problem, but create a new problem, because there would be an immediate run on the banks, at the current rate of exchange, due to demands for international holdings.

Why is this so?

At the current rate of exchange, what little IQD is held by Iraq, would be consumed immediately, to demand for hard cash holdings, not to mention forex. Forex alone, runs about $4 Trillion per day.

How long do you think, $3 Billion in IQD would last? I think maybe about the first hour of trade would cause a run and a bank holiday, at the current rate of exchange.

So, what this article is suggesting, is that the CBI and Banks of Iraq, are certainly strong enough, to handle the transactions of foreign currency, but would not last even one hour, if the IQD became internationally recognized, at the current rate of exchange.

Let's further this example, and suggest, that the entire amount of IQD in print, (based on news releases from CBI,) is 27 Trillion. Let us say, that Iraq could, (as if that were possible,) to buy back the entire cash supply at the current rate, (which is ridiculous, but let's just say for now, they could). The entire stock would cost them about $25 Billion of their existing reserves, which they could easily do and they would still have half of their foreign reserve left to easily support the entire 27 Trillion IQD.

Here would be the problem:

That is still only about $25 Billion worth of IQD, with only the Fractional Reserve ability, to place $125 Billion worth of IQD, into circulation, digitally.

Again..... even with the entire supply, even if that were possible to recapture at the current rate, again, within the first hour of trading in the world market, there would be a run on the banks and Iraq would be left with no IQD left in their vaults, even because the people would grab it up, much less international trading.

My guess is, nothing under a $1 to 1 IQD rate, could keep that from occurring, once the IQD is put on the open market.

So..... this article is saying, they are strong enough to support the Dollar, but they could never support the IQD at the current rate of exchange. It has to be strong enough and with enough value, to stop a run on the banks, due to the demand. That is simple economics 101.

Here is another way to look at this:

If the CBI is strong enough to support the USD at $1 to $1 less a percentage, offset by the auctions, then it is also able to support a $1 to 1 IQD rate, unless the eternal demand is too great at $1.00, that there is still a run on the banks.

My own calculations based on the MOP projections, would indicate, that for EOY 2010, the value would have to be set at a minimum of $1.36 in 2010, but closer to $1.75 for the years 2011 through 2012, which even then, many believe would still be to low, to fend off a run, because future speculation over the coming 5 years, shows that value to be about double that.

Now, if that is so, and my own calculations are showing the 5 year plan value to be supportable at as high as $3.93, also based on MOP projections and calculations, along with the IMF Dejure Rate of $.00342 for EOY 2009, adding an additional $7 Billion to the Reserves from 2009 reports, should reflect a Real Rate of +/- $.00393 for EOY 2010.

Drop the 3 zeros, means to shift the decimal 3 spots to the left = $3.93 REER.

Now, here is why I am showing you this:

If you have been listening to what people like Scooter or Rudy have been talking about, it would be a fair assumption, to say, world forex giants and multi international corporations, would jump on forex prices with the expectation of doubling or tripling their returns, but you would also have players driving down prices on those markets, if the rate is set too high, by playing the shorts on the market.

That activity, known as 'Orbits' in circulation, is much of what sets the tempo and value, which is regulated by the amounts in circulation, proportionate to demand, but supported by the actual Reserves, of the Host Nation, supporting and backing that currency.

If the price is too high, CBI and GOI have to sell of all their wealth to pay for their own paper, and they loose the value to inflation and have to destroy what they bought with their wealth.

If it is too low, it is paid for buy the markets and does not cost them a dime, but they would have a run on the banks.

So, what is a Bilderberger to do?

The answer, is they have to come out at a value, that is just right, low enough to attract just the right amount of investors, that the market pays for the revaluation, yet high enough, to keep out, over-speculation, as to keep from having a bank run.

My guess is, that would be about 1/3 to 1/2 of the projected 2010 amount of the REER, of $3.93.

That is roughly $1.31 to $1.92, which is also consistent with the Qualitative vs Quantitative ratios of the percentage increases reflected in the Feasibility Study and the 5 Year Plan, of the Ministry of Planning.

So...... this was a long explanation, in an effort to fill in the blanks, as to what the above article, is saying. They are saying they have the funds to continue using the Dollar and Foreign Currencies, as a banking policy for Iraq, but as we see, they are also saying, they need a Banking Law and Central Bank Law, of which both have been in Parliament already, and are among the 200 plus laws in Parliament, yet to be addressed and ratified.

If you are confused about this, don't feel bad. I have been studying this for a full 7 years and am still struggling to grasp and comprehend the big picture. Much of what is going on with this, is still contained in 'Classified Documents' and is also a moving target, that changes daily. It is 'Live' and 'Fluid'.

Be glad you are in this investment. I know of no better place to be positioned so far ahead of the curve. You are in the right place at the right time.

.

Enoch8

.

[Slaydadea]

Oil falling at this hour $102.69

Hit $20.00 Baby!! Where it should be. Just no reason for it. Absolute Greed!!!

[pontiyak]

Doc... I am I newbie, yet I find myself drawn to your updates, more and more.. Seems your updates and comments smack more of common sense than all the other

floatsome and jetsome around here...Thanks

The best things in life RV...

yak

[SunFun]

Doc,

I have been reading your post for some time now and I would like to thank you. I truly appreciate all your efforts to let us know the facts. I like the personal touch, I feel like you are my next door neighbor. Thank you.

I admire and respect your relationship with your wife. That is the greats statement you have ever made. she is a very lucky Lady. If i could add my two cents in and please do not take it the wrong way. We all have a vested interest here and want to know what is happening, but lets face the facts, after all this time and engry what have we really learned? If we evaluate it all this is what we know. The ID is going to revalue. We are not going to get any kind of "Heads Up" on the date or rate. I see constant speculation on the intel we read and that never pans out. People get depressed and upset over what was really nothing. It is not fair and not the right thing to do. So each morning I enter my office, cup of java in my hand, pull up DV on the computer, quietly read your post and Knights, then move on with my day. Understand I enjoy your post because it contains not only good info but it has a down to earth human flavor.

When the Dinar RVs we will wake up one morning and there it will be. We don't have to be the first to know, there will be no rush to cash in and the rate is not going to go away over night. Relax, enjoy time with your bride and enjoy the ride. God bless.

SunFun