Currency Redomination

[Ohioguy]

I hope I am posting this under the proper forum. With all the banterring back and forth about "LOP" or no "LOP" I simply started trying to find anything that could help me understand all of this. I came across this VERY intereting and informative article. It is a long read and I am still rereading and digesting, but from what I am gathering from this is that a redomination is not a bad thing for us. If I understand what I am reading the value moves along with removing of the zeroes. For instance 1 Dinar will have the same value of one thousand dinar when the redomination happens. So in essence the removal of the three zeroes Is a revaluation. Currently, 1USD equals approximately 1000 IQD (I am just rounding it for demonstration purposes). If the three zeroes are lifted then 1USD will equal 1IQD. Please, read this. It will take a while.

http://www.unc.edu/~lmosley/APSA%202005.pdf

[keepmwlknfny]

Yes a redenomination isent all that bad....we still make money off it.....alot of people just associate it with us getting screwed over but in reality they can RV quite high afterwards.....hoping for a straight up RV tho of course.....no one wants to hear they wont make millions....

[Jim1cor13]

I hope I am posting this under the proper forum. With all the banterring back and forth about "LOP" or no "LOP" I simply started trying to find anything that could help me understand all of this. I came across this VERY intereting and informative article. It is a long read and I am still rereading and digesting, but from what I am gathering from this is that a redomination is not a bad thing for us. If I understand what I am reading the value moves along with removing of the zeroes. For instance 1 Dinar will have the same value of one thousand dinar when the redomination happens. So in essence the removal of the three zeroes Is a revaluation. Currently, 1USD equals approximately 1000 IQD (I am just rounding it for demonstration purposes). If the three zeroes are lifted then 1USD will equal 1IQD. Please, read this. It will take a while.

http://www.unc.edu/~lmosley/APSA%202005.pdf

Thank you Ohioguy This is a good and useful

article to review carefully and especially the instances

of and reasons FOR redenomination, etc.

I have read bits and pieces of this report before, to have

it a complete report is a good find. It is worth the time to

review this. This report confirms much of what has been

discussed here by keep and others, who have put in some

very well done digging and research.

Thanks again...I hope folks will take the time to understand

the reasons and the purpose, after stabilization has occurred.

Iraq fits the bill certainly, how it ends up is somewhat uncertain,

but history tells quite a story and a likely outcome over time.

Good effort, and wise to research it for yourself also

All my best!

Jim

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[sportfisher]

I hope I am posting this under the proper forum. With all the banterring back and forth about "LOP" or no "LOP" I simply started trying to find anything that could help me understand all of this. I came across this VERY intereting and informative article. It is a long read and I am still rereading and digesting, but from what I am gathering from this is that a redomination is not a bad thing for us. If I understand what I am reading the value moves along with removing of the zeroes. For instance 1 Dinar will have the same value of one thousand dinar when the redomination happens. So in essence the removal of the three zeroes Is a revaluation. Currently, 1USD equals approximately 1000 IQD (I am just rounding it for demonstration purposes). If the three zeroes are lifted then 1USD will equal 1IQD. Please, read this. It will take a while.

http://www.unc.edu/~lmosley/APSA%202005.pdf

the down side is you would have to exchange all of your currency with the new replacement currency, so a value neutral redenomination requires exchange at an expense.

[Ohioguy]

Keep, If I am reading this correctly, the I raq Dinar would have basically a one to one revalue upon a redomination. For instance if three zeroes are removed a 1000 note IQD would become a 1 Dinar note. But according to this guy after the redomination the 1 IQD note would retain the value of the old 1000 Dinar note. Since currently 1 USD purchases purchases 1160 Dinars after the redomination 1 USD would purchase 1.160 Iraq Dinars, so we would be looking at a revaluation of basically one IQD equaling 1 USD. This article is a long read, but that is the understanding of what I read. I am not saying absolutely, but that is what I deduct. So, if we have a million IQD we could exchange our IQD for approximately one million USD. I confess my igmorance, but that what it seems this article is saying.

[keepmwlknfny]

Keep, If I am reading this correctly, the I raq Dinar would have basically a one to one revalue upon a redomination. For instance if three zeroes are removed a 1000 note IQD would become a 1 Dinar note. But according to this guy after the redomination the 1 IQD note would retain the value of the old 1000 Dinar note. Since currently 1 USD purchases purchases 1160 Dinars after the redomination 1 USD would purchase 1.160 Iraq Dinars, so we would be looking at a revaluation of basically one IQD equaling 1 USD. This article is a long read, but that is the understanding of what I read. I am not saying absolutely, but that is what I deduct. So, if we have a million IQD we could exchange our IQD for approximately one million USD. I confess my igmorance, but that what it seems this article is saying.

Its possible but there has been many different articles about the redenomination for Iraq and the most recent was talking about doing that and then being able to bounce back up to the rate the dinar was in the 80s which was in the 3 dollar range so if thats the case we would triple our investment.....but we cant be sure what they would RV to after a lop or even if it will....

[Sawmill]

I totally agree.... Been in the dinar game nearly a year, and from what I see, a lop might be a bit of a let down from the much anticipated straigh RV, but making 200 to 600 percent on our investimet still wouldnt be considered a bad investment. However, you would have to be invested much heavier than I am to make it a life changer. Still, you will find me hoping for the best. I am convinced we are all riding on the coat tails of some master financial plan, and if we get lucky, really lucky, we could all stand to make some good money. I am satisfied and plan to stay the course. Not planning on buying more, but for now, mine are not for sale either! Go RV!

[mentalmagic]

Yes a redenomination isent all that bad....we still make money off it.....alot of people just associate it with us getting screwed over but in reality they can RV quite high afterwards.....hoping for a straight up RV tho of course.....no one wants to hear they wont make millions....

You are correct Keep. It could go either way. LOP, followed by high RV anywhere between $3 and $6, or it could be a smaller straight RV of a few cents per dinar. I hope the latter is true, but in either case, we will be making some money, or lots of money. Something if definately going down in the next 48 hours. Never seen this much activity going on since that television announcement by Shabibi and Parliment on Iraq National television earlier today.

[Ohioguy]

You are correct Keep. It could go either way. LOP, followed by high RV anywhere between $3 and $6, or it could be a smaller straight RV of a few cents per dinar. I hope the latter is true, but in either case, we will be making some money, or lots of money. Something if definately going down in the next 48 hours. Never seen this much activity going on since that television announcement by Shabibi and Parliment on Iraq National television earlier today.

I confess my ignorance here, but just asking. If a person holds one million IQD and redenomination should happen and now one IQD becomes as valuable as 1000 IQD before the redomination. So, I cash in my one million IQD and recieve $1,000,000.00. I am laughing to myself because I am having a little difficulty expressing my thoughts in my native language and I think I can comprehend the meaning of something that has been translated from another language.

[keepmwlknfny]

I confess my ignorance here, but just asking. If a person holds one million IQD and redenomination should happen and now one IQD becomes as valuable as 1000 IQD before the redomination. So, I cash in my one million IQD and recieve $1,000,000.00. I am laughing to myself because I am having a little difficulty expressing my thoughts in my native language and I think I can comprehend the meaning of something that has been translated from another language.

Your 1 million dinar after a redenomination would only be 1000 dinar and then IF it was revalued at 1 dollar afterwards you would recieve 1000 USD.....if they revalued to 3 after the LOP then you would recieve 3000 USD.....

[detroitjazzman]

I keep reading this removal of zero's. My question is....Just supposing I have a million dinar in an account that I just negotiated with the Iraqi government. They deposit the money in an account in Iraq the day before RI/RV. the next day I wake up and find that Iraq has redenominated their currency. When I go to wire my money home that day, How much money do I have under your concept? 1,000,000 or as you suggest 1,000. just a question. Everything I've read, my neighbor has indicated to me suggest that what is written in Arabic is lost in the translation. I tend to trust his translation because he is a Professor, with a PhD.... he is from Iraq with a large english vocabulary. What I'm led to believe, removal of zero's in the context used in the media, means to take out or circulation. Time will tell`

[DAME1]

Sorry not reading it that way

If you have a million dinar they remove the zeros you just exchange the currency for lower denoms you still get a million..... or if it revalued you cash in that same million at a higher rate.

Hope that makes sense

[dinarck]

Your 1 million dinar after a redenomination would only be 1000 dinar and then IF it was revalued at 1 dollar afterwards you would recieve 1000 USD.....if they revalued to 3 after the LOP then you would recieve 3000 USD.....

`

Correct.

When people say this horse has been beat to death they aren't kidding and everytime it is wacked the same conclusion remains. It is funny to read how many diffrent ways this redenomination has been spun.

Some say they are removing the 000 notes from circulation. OK Please explain how they are magically doing this. I could see it in Iraq but the trillions in 000 notes abroad aren't going anywhere. Are you going to give up your stash of 25,000 notes? Me niether. O, they say you will have a window to go exchange them for lower denoms. Yeah, they are going to give me 1000 new lower denom 25 notes per 25,000 note I give them. I don't think so. They are also saying that they are submitting the process of removing the zeros from the currency to parliment for a vote. Now how can it be that if they have already completed or are close to completion of removing the 000 notes from circulation that they would have to submit it for a vote? That's because thats not what they are voting on, they are voting to LOP by removing zeros from the currency like they have said they are goin to do over and over.

We now have opinions that they will remove the zeros from the currency but the value will remain the same. Here is where some are getting confused because when they read this they think that there will be a LOP but we some how will get 25,000 USD per 25,000IQD afterwards. This is obviously not the case. It is true that the value will remain the same but you have to understand that the value of a 25,000 IQD is about 25 USD now. If they remove zeros from the currency then they will have to remove them from the exchange rate at the same time. This means a 25,000 IQD becomes a 25 IQD and the exchange rate is changed to the same or naer the USD and now a 25 IQD and a 25 USD are worth the same. It seems to me (IMO) that all these recent articles are saying that they must do this step for the IQD to begin to gain in value. That is why when the articles say that they will remove the zeros that the IQD can gain value against the USD people are assuming that they are going to removing large bills from circulation and then going to RV. What they are saying is that they cannot RV in any way unless they LOP. Again IMO.

I think that an article in the recent past summed it all up when they very clearly stated that the removal of the zeros would not improve the purchasing power of the IQD but that the GOI has hopes that it will. They also mention in the same article the 27 trillion in circulation and having to bring that down to billions. This cannot be done any other way except for a LOP. I hate that I have this opinion because I know that it is a huge downer for everyone invested including myself but I think that we all need to read the writing on the wall and except what they are telling us if in fact these articles are legit. However we need to look at the bright side. The reason the GOI said that it had hopes that it would increase is because it knows that it will as soon as the currency is redenominated. The IQD can only raise in value from this point because of future oil production and lack of debt. Iraq has a counrty to rebuid and there is no way they could afford to do so if they owed tens of trillions post RV. This redenomination solves that issue.

Again (IMO)

[detroitjazzman]

Sorry not reading it that way

If you have a million dinar they remove the zeros you just exchange the currency for lower denoms you still get a million..... or if it revalued you cash in that same million at a higher rate.

Hope that makes sense

First you have to read the quetion in order to give an answer. Under the proposed question, the cash was in the bank, nothing to cash in, sooooooo you are telling me that I go to bed with 1,000,000 dinar and wake up with 1,000. Under the concept I proposed, the Iraqi government would have screwed me big time. and the same would be applicable to any person or country that held currency in Iraq. I trust that Iraq is not starting out screwing countries and investors by reducing capital investments that have been made in their country. I have to go on record as saying, removal of the zero's mean's to withdraw from circulation. RIF

[Doctor Smith]

Sorry not reading it that way

If you have a million dinar they remove the zeros you just exchange the currency for lower denoms you still get a million..... or if it revalued you cash in that same million at a higher rate.

Hope that makes sense

I could live with that scenario. That would be what I call an RV. I hope your right and they don't lop it. No way to tell what they are talking about for sure.

[Ohioguy]

First you have to read the quetion in order to give an answer. Under the proposed question, the cash was in the bank, nothing to cash in, sooooooo you are telling me that I go to bed with 1,000,000 dinar and wake up with 1,000. Under the concept I proposed, the Iraqi government would have screwed me big time. and the same would be applicable to any person or country that held currency in Iraq. I trust that Iraq is not starting out screwing countries and investors by reducing capital investments that have been made in their country. I have to go on record as saying, removal of the zero's mean's to withdraw from circulation. RIF

Detroit, I agree with you, I think LOL. Right now my mind is spinning from all this. I really believe this article implies that a redomination also includes the removal of the zeroes from the exchange rate as well. So we would be able to turn in our three zero currency at the new exchange rate of .86, which interprets $1.16 per dinar. I think many of us have been and continue to look at this one dimentionally. It really is fascinating to hear everyone's thoughts, but I think we are all going to be surprised when all this comes down. The link I posted really is very informative.