Central Bank: It is time to re-evaluate the currency, commensurate with the price changes and the wage in the economy

[dinarck]

wait a minute ive heard the us will buy our dinar they want it for the purchase of petro dollars anyone else heard this ?

Yeah I heard it from a DD CC. Didn't buy a word of that entire call. Was painful just to listen.

[Riley]

i had this translated in arabic to english,by my dubai buddy. what they are saying is its time to revalue there currency to get on par with goods and services, and the only way this would be a sucess is for the rate to be around $1.00. it also seems that they have a sense of urgency on doing this as well. i know i dont come on this site anymore, but it was painful watching people getting the meaning of this article wrong......

Thank you Sonny1 for the translation - we sure miss ya!!!!!

[nepperson]

UUUMM...

Have to disagree. If they remove the three zeros your 25,000IQD becomes 25IQD. If they want to be a member of the WTO then I would think they would need to bring their liability down from trillions to billions. Again the 25,000IQD is not worth 25,000USD. It is worth 25 USD. Bringing it down to 25IQD worth 25 USD isn't screwing anyone except for destroying our dreams of becoming millionares at the expense of Iraq. Yes people will invest in their country anyway. There is billions to be made there. I know that the notion that a redenomination would hurt Iraq and no one would have confidence and all this has been the status quoe for some time but that doesn't mean it's true. For all we know big wig investors and large corporations and countries have known all along that Iraq would have to redenominate before the IQD would raise in value. Just because we don't like it means nothing.

Perhaps, you MISSREAD what I wrote, I never said that the IDQ is CURRENTLY equal to the USD I was simply reffering to what would happen if they delete the three zeros and revalue at 1 to 1, IF, A, REVALUE, OF, 1, TO, 1, HAPPENS, then the actual 25,000 dinar note that I am holding in my hand would also increase in value, or perhaps you are telling me that the 25,000 note that I have in my hand is going to magicly loose its three zeros,,, WOW that would be a NEAT TRICK! so MAYBE I should go right now and change all of my 25,000 notes to 1s, 5s, and 25s that way I'll come out on top, or what about people who have invested, oh, say 1,000.00 USD and have 1,000,000.00 IDQ (Just so you don't get lost, I MADE THESE NUMBERS EVEN to make my point THEY ARE NOT EXACT!) sitting in the bank electronically..... SOOOOO those investors are fine right, since that money is ELECTRONIC NUMBERS NOT ACTUAL PAPER CURRENCY? what you are saying is rediculous,,,, big jumps can happen in currency, they have in the past, they will in the future, up or down who knows.. it's speculation "a conclusion, theory, or opinion based on incomplete facts or information". that is all you are doing and that is all I am doing.... some peoples facts and opinions are more accurate than others, wether the revalue is large or small, it is coming, And I am NOT FOOLED so easily as others I do not count on this thing going 5 to 1 or even 3 to 1 however I do believe there is a possibility for a 1 to 1 or so, even if it goes .05 to 1 I'm fine with that I have placed my money where I am happy and I don't go running out and buying more every time some one yells RV tomorrow. I have 225.00 USD invested and that is where I'm staying. so your comment that I am dreaming for millions HA! I bet you have more than I do! So maybe, SLOW DOWN a bit while you're reading, maybe read it twice before you go putting your foot in your mouth and making accusations about things that were NEVER said.

Best Regards!

[countryroads]

Why would they tell us this. Not saying its not good or anything but just seems suspect.

Maybe they are not as good at handiing international pressure as would like us to believe.

Go RV Please.

[dinarck]

Perhaps, you MISSREAD what I wrote, I never said that the IDQ is CURRENTLY equal to the USD I was simply reffering to what would happen if they delete the three zeros and revalue at 1 to 1, IF, A, REVALUE, OF, 1, TO, 1, HAPPENS, then the actual 25,000 dinar note that I am holding in my hand would also increase in value, or perhaps you are telling me that the 25,000 note that I have in my hand is going to magicly loose its three zeros,,, WOW that would be a NEAT TRICK! so MAYBE I should go right now and change all of my 25,000 notes to 1s, 5s, and 25s that way I'll come out on top, or what about people who have invested, oh, say 1,000.00 USD and have 1,000,000.00 IDQ (Just so you don't get lost, I MADE THESE NUMBERS EVEN to make my point THEY ARE NOT EXACT!) sitting in the bank electronically..... SOOOOO those investors are fine right, since that money is ELECTRONIC NUMBERS NOT ACTUAL PAPER CURRENCY? what you are saying is rediculous,,,, big jumps can happen in currency, they have in the past, they will in the future, up or down who knows.. it's speculation "a conclusion, theory, or opinion based on incomplete facts or information". that is all you are doing and that is all I am doing.... some peoples facts and opinions are more accurate than others, wether the revalue is large or small, it is coming, And I am NOT FOOLED so easily as others I do not count on this thing going 5 to 1 or even 3 to 1 however I do believe there is a possibility for a 1 to 1 or so, even if it goes .05 to 1 I'm fine with that I have placed my money where I am happy and I don't go running out and buying more every time some one yells RV tomorrow. I have 225.00 USD invested and that is where I'm staying. so your comment that I am dreaming for millions HA! I bet you have more than I do! So maybe, SLOW DOWN a bit while you're reading, maybe read it twice before you go putting your foot in your mouth and making accusations about things that were NEVER said.

Best Regards!

Don't think I misread. Here is what you wrote. "If they remove the three zeros, that does not diminish your investment, 25,000 dinar note will still be worth 25,000". Now maybe I misunderstood and you where refeing to removing zeros from the exchange rate. If so I apologize but if not then if they remove three zeros your 25,000IQD will become 25 IQD. It will no longer be worth 25,000.

[coldwarvet]

Thanks, Sonny1 for the post.

[nepperson]

Don't think I misread. Here is what you wrote. "If they remove the three zeros, that does not diminish your investment, 25,000 dinar note will still be worth 25,000". Now maybe I misunderstood and you where refeing to removing zeros from the exchange rate. If so I apologize but if not then if they remove three zeros your 25,000IQD will become 25 IQD. It will no longer be worth 25,000.

So, let me make sure that I am not MISSUNDERSTANDING you. You're saying that if I have 25,000 IDQ in a bank account, electronic funds, and they remove the three zeros, they in essence are takeing money out of my account so they don't loose out on the RV? Right? They are going to basically rob millions of investors right under their noses leaving them with less then what they bought the dinar for? You said that "we will all make money on this investment but it won't be the MILLIONS I WAS HOPING for" (Peraphrasing). however if I am Not missunderstanding you, then tell me how we will make any money at all on this investment if they do what you are suggesting? If I pay 26 to 28 USD for 25,000 IDQ and they devalue the worth of the currency that is in circulation while at the same time increasing the values to 1 to 1 but my 25,000 IDQ note is now only worth 25 USD then I go to exchange the 25,000 dinar note back to USD the dealer takes his cut on that transaction and then what are you left with? that means we've all lost money. or maybe my math is off. or maybe you and everyone else paid 13 USD for 25,000 IQD then you might break closer to even. Not to mention everyone keeps saying that they will either LOP or RD, well if they LOP and change the value of the currency in circulation, then they will also have to RD cause no one is going to want to carry a bunch of 25,000 dinar notes to pay for a $25 pair of shoes. ( just an example, however corny) it's not practicle, one last point, on an individual basis, in Iraq, a LOP as you suggest would hurt their citizens more then help them, believe it or not most of the citizens of Iraq have some amount of IDQ in their possesion wich if it RVs at a 1 to 1 and they don't do any funky stuff to dimminish the worth that they are holding they will have more money and more PURCHASING POWER.... so the answer to the question of why would they hurt their citizens to make us rich is, they won't be hurting their citizens. I gotta go to work now, and I'm tired of typing, so peace. By the way sorry for seeming a bit irritated I just get tired of hearing things that don't make sense, and perhaps my logic makes no sense to you, but I guess that's what comes with Speculation, right.

Peace to you.

[kevnutz]

[MPG350]

lol Geez people dont be so stupid a 25000 IQD will never be worth 25000 usd, it would be sweet if they did I would have many millions but dont be dumb.

[bluejay]

I ran this by Sonny1 today, and he ran the original Arabic text by his buddy in the ME. Dude said we are reading it correctly when we think one dinar will equal one dollar... he also stated that there was a sense of urgency to the article, as if this were going to happen very soon. Take this as you may, but I like it!!

This might not be a proper question but is the $1.00-IQD equal to $1.00-USD, after they raise or take off three zeros from the currency. If this doesn't apply to sorry, I'm a slow learner...

[Dalite]

This might not be a proper question but is the $1.00-IQD equal to $1.00-USD, after they raise or take off three zeros from the currency. If this doesn't apply to sorry, I'm a slow learner...

That is what appears to be the bottom line.

It looks to be an adjustment of the nominal rate designed to contract the money supply, move the country closer to a single currency, prepare for release of smaller denominations, bring costs, selling prices, wages and monetary interests back to pre-inflation proportions.

We don't know if this concept extends beyond Iraq.

It looks to be a redemonination; not a revaluation, or devaluation.

It is like factoring fractions down to common denominators.

1000 / 1170 = 1 * 1.17

Remove 3 zeros on the left. Equalize by shifting equal number (3) decimal places on the right..

But, in the absence of formal announcement from CBI confirming the above, this is merely speculation on my part.

Having said that, the above seems to be math involved....

See, clear as mud..

[blessedman]

lol Geez people dont be so stupid a 25000 IQD will never be worth 25000 usd, it would be sweet if they did I would have many millions but dont be dumb.

I'm sorry maybe I misunderstood........................are you saying that it's dumb to believe there wont be a 1IQD = $1 RV.

[bluejay]

That is what appears to be the bottom line.

It looks to be an adjustment of the nominal rate designed to contract the money supply, move the country closer to a single currency, prepare for release of smaller denominations, bring costs, selling prices, wages and monetary interests back to pre-inflation proportions.

We don't know if this concept extends beyond Iraq.

It looks to be a redemonination; not a revaluation, or devaluation.

It is like factoring fractions down to common denominators.

1000 / 1170 = 1 * 1.17

Remove 3 zeros on the left. Equalize by shifting equal number (3) decimal places on the right..

But, in the absence of formal announcement from CBI confirming the above, this is merely speculation on my part.

Having said that, the above seems to be math involved....

See, clear as mud..

So if they just redenominate how will there be any gain in there currency, other than an easier banking transaction's. This is so weird

I can't get my head around it....If $1170.00 becomes $1.17 isn't that a revaluation within itself....I feel like I just drank 4-bottle of scotch..Thanks for your reply though. I'm trying.

[dinarck]

So, let me make sure that I am not MISSUNDERSTANDING you. You're saying that if I have 25,000 IDQ in a bank account, electronic funds, and they remove the three zeros, they in essence are takeing money out of my account so they don't loose out on the RV? Right? They are going to basically rob millions of investors right under their noses leaving them with less then what they bought the dinar for? You said that "we will all make money on this investment but it won't be the MILLIONS I WAS HOPING for" (Peraphrasing). however if I am Not missunderstanding you, then tell me how we will make any money at all on this investment if they do what you are suggesting? If I pay 26 to 28 USD for 25,000 IDQ and they devalue the worth of the currency that is in circulation while at the same time increasing the values to 1 to 1 but my 25,000 IDQ note is now only worth 25 USD then I go to exchange the 25,000 dinar note back to USD the dealer takes his cut on that transaction and then what are you left with? that means we've all lost money. or maybe my math is off. or maybe you and everyone else paid 13 USD for 25,000 IQD then you might break closer to even. Not to mention everyone keeps saying that they will either LOP or RD, well if they LOP and change the value of the currency in circulation, then they will also have to RD cause no one is going to want to carry a bunch of 25,000 dinar notes to pay for a $25 pair of shoes. ( just an example, however corny) it's not practicle, one last point, on an individual basis, in Iraq, a LOP as you suggest would hurt their citizens more then help them, believe it or not most of the citizens of Iraq have some amount of IDQ in their possesion wich if it RVs at a 1 to 1 and they don't do any funky stuff to dimminish the worth that they are holding they will have more money and more PURCHASING POWER.... so the answer to the question of why would they hurt their citizens to make us rich is, they won't be hurting their citizens. I gotta go to work now, and I'm tired of typing, so peace. By the way sorry for seeming a bit irritated I just get tired of hearing things that don't make sense, and perhaps my logic makes no sense to you, but I guess that's what comes with Speculation, right.

Peace to you.

Ok say you have 25,000IQD in a Warka account. If they redenominate it will indeed become worth 25IQD. Right now a 25,000 IQD is worth around 25 USD so you lose nothing. If you bought your 25,000IQD for more than 25USD then you did lose a little and you have the dinar dealers to thank for that because they got thier spread.

Look, the way this redenomination will seem to go down is by basically dividing by 1000. Not just the currency but the prices,salaries,rent,loans,bank accounts. In other words everything will be adjusted. I seem to think they would bring the exchange rate higher than the USD so that purchasing power will be increased but we had an article state that it wouldn't. Maybe the authors of that article were aware of the redenomination but unaware of the exchange rate going beyond the USD. Anyway hopefully they will indeed go to an exchange rate of 3USD=1IQD. That would triple the purchasing power of the Iraqi people and we would all make triple our original investment.

That is freakin awsome.

Edited April 22, 2011 by dinarck

[FishmanTx]

Ok guys, since I haven't got any real response on my previous questions, I'll layout all my concerns and let the group gel on it. I'm hoping to get credible responses from people who KNOW what they are talking about, not just THINK they know.

After/during the currency changeout from Saddam dinar to the new issue, the Fed Gub'ment passed a special law/resolution/whatever! allowing individuals in the US to buy and hold the new dinar. My issue is what is the fate of all the "3 zero" notes currently held by individuals and companies outside Iraq. Gov't holdings (any govt) outside Iraq is not my concern at this point. I am considering the fact that a "lop" or RD WILL come with some sort of RV on the rate (pre or post lop/RD).

1. Redenomination (is NOT a lop) - the current notes are removed from circulation and retain their value, but there is usually a time limit to change out the notes. Ex: a 25k note is exchanged for equivalent value in new denominations. This would be irrelevant to us if cashing-out immediately.

2. LOP - (is NOT THE SAME AS RD but IS a form of it) the current notes value changes relative to the ratio of change, Ex: a 25k note now equals a 25, a 10k=10, etc.. This requires the 25k to coexist with the 25 at the same value, but would also be time limited to change out. In the case of a LOP, we would need to hold the dinar to allow for increases in market value over time to make something of our investment. What mechanism would Iraq or the Fed place for the exchange of these denominations to valid currency notes within the time frame specified for the changout for notes held outside Iraq? One can't just fly to Iraq with a handful of notes, most of us can't afford it. A LOP would be a logistical nightmare for all the individuals, companies, and governments outside Iraq. Mostly just the individuals as govts and companies have the means to cover their collective arses. Will our own govt let us to take it up the wazzoo after "allowing" us to play this game? We'll see.....

"I've said m'piece and counted to 3..."

Oh Brother Where Art Thou

Fish

[FishmanTx]

Ok guys, since I haven't got any real response on my previous questions, I'll layout all my concerns and let the group gel on it. I'm hoping to get credible responses from people who KNOW what they are talking about, not just THINK they know.

After/during the currency changeout from Saddam dinar to the new issue, the Fed Gub'ment passed a special law/resolution/whatever! allowing individuals in the US to buy and hold the new dinar. My issue is what is the fate of all the "3 zero" notes currently held by individuals and companies outside Iraq. Gov't holdings (any govt) outside Iraq is not my concern at this point. I am considering the fact that a "lop" or RD WILL come with some sort of RV on the rate (pre or post lop/RD).

1. Redenomination (is NOT a lop) - the current notes are removed from circulation and retain their value, but there is usually a time limit to change out the notes. Ex: a 25k note is exchanged for equivalent value in new denominations. This would be irrelevant to us if cashing-out immediately.

2. LOP - (is NOT THE SAME AS RD but IS a form of it) the current notes value changes relative to the ratio of change, Ex: a 25k note now equals a 25, a 10k=10, etc.. This requires the 25k to coexist with the 25 at the same value, but would also be time limited to change out. In the case of a LOP, we would need to hold the dinar to allow for increases in market value over time to make something of our investment. What mechanism would Iraq or the Fed place for the exchange of these denominations to valid currency notes within the time frame specified for the changout for notes held outside Iraq? One can't just fly to Iraq with a handful of notes, most of us can't afford it. A LOP would be a logistical nightmare for all the individuals, companies, and governments outside Iraq. Mostly just the individuals as govts and companies have the means to cover their collective arses. Will our own govt let us to take it up the wazzoo after "allowing" us to play this game? We'll see.....

"I've said m'piece and counted to 3..."

Oh Brother Where Art Thou

Fish

Whoops!!!! Sorry for the double post!!!

[dog53]

Not sure why some think a 25k note will be worth only what a 25 note is worth, ie, the ugly lop...I think we have to remember, lots of Iraqis hold 25k notes. Can you imagine the uproar and riots in their own country if they did this??? Just don't see that happening. IMHO - I think the CBI will go counter to a lot of other projections and go for the big score, ie, a re-value that is significant, meaningful and gets lots of press - just IMHO. Like way more than $1 to 1 dinar...

Sorry but why would they be mad ? Their 25 note would purchase the same amount of items that their 25k note did. Maybe even more if it RV`s after it lops. Say it RV`s to 1 dinar= $2 then that 25 note will be worth 50 in merchandise. They will Be dancing in the streets hahahah

[Dalite]

So if they just redenominate how will there be any gain in there currency, other than an easier banking transaction's. This is so weird

I can't get my head around it....If $1170.00 becomes $1.17 isn't that a revaluation within itself....I feel like I just drank 4-bottle of scotch..Thanks for your reply though. I'm trying.

I have no crystal ball, so this is all speculation on my part.

The stage we have been discussing is merely another step toward revaluation.

No ground was lost in purchasing power, but strong steps were made at very quickly removing some of the traces of inflation from the economy.

They have to be cryptic while the process is ongoing; otherwise, CBI will have to announce it as a RV at the implied rate of 1.17:1; which would waste a good RV.

If they just RV at 1.17 dinar to the dollar, we will be looking at a rate of ,86.

As long as they do not drop the zeros of he currency out of Iraq, the investors have an opportunity to cash out or ride it on up to higher worth as Iraq becomes more productive.

The Iraqis don't get an immediate reward, but their economic situation should start on an upward trend that should last for some time to come.

Will they drop zeros on the Dinar we hold? That is the 27 trillion dollar question.

Sorry I don't have any answers, just musings that accent the way the numbers seem to be in agreement..

[JuryPicker]

NOBODY KNOWS - PERIOD!

[drox]

Hey Drox,

I need a little clarification here cuz I'm feeling a little stupid too. I've obviously missed something cuz I can't see the logic in debt increase with an increase in the dinar's value (str8 rv). Are we speaking of internal or external debt? Internal, yes, it makes sense. External, I can't see it. On external debt, the debt is relative to the currency of the country owed, is it not? For example: $1 billion is owed to the US. At the current rate, equals 1,170,000,000,000 (1.7 trillion IQD). A straight rv @ 1:1 would change that from 1.7 trillion IQD to 1 billion IQD necessary to pay off the 1 billion USD owed. An increase in value would make it easier to pay foreign debt using less dinar to do so. Their 27 trillion IQD are now equivalent of 27 trillion USD. Correct so far or is my logic flawed? I'm missing something here, of course I'm no economist.

Thanx

Fish

Sorry thats supposed to be 1.17 trillion IQD.....sorry

Hi Fish! I was just letting the thread die out but it doesn't want to. That's good if we are all learning something from each other right? This was an excellent question and please know I don't have all the answers. Scooter or Doc might be better answering this one but I will give it a go.

I was referring to internal debt. But it gets a little hazy between what is debt and isn't to me. Are foreign individual investors holding Dinar considered external debtee's? Not sure that's proper English but you know what I mean. External debt basically means Iraq borrowed money from outside of the country. They already received it and it was most likely given to them in the debtee's currency. So an RV would make it much easier to pay that external debtee back as you suggest. I was referring to when anyone holding Dinar decides to cash in the CBI will ultimately be responsible. Where do they get the money to do that... they must borrow from somewhere to fund the cash out. I am not sure that involves external debt but I would have to really think about it.

What I do know is that Imports and Exports will be dramatically effected by a 1 : 1 RV. It would be both a blessing and a curse. Iraq would only import goods (other then oil) rather than create new industry to make the goods themselves. Why? Because it would be ridiculously cheap to import everything. That does not sustain a country or create jobs. Iraq could tariff the heck out of those goods which could make the goods coming in cheaper quality and start limiting importers altogether. Trade imbalances would be created and higher interest rates and inflation would be inevitable in my opinion. That would be a concern for the IMF. The social class gap would widen and security becomes even a bigger issue due to crime. This is why I believe an RI or significant RV is unlikely in one chunk. Instead I believe it will be a methodical and reasonable climb that takes into consideration Iraq's market conditions, infrastructure, politics, laws, and social setting. That's how it plays out in my head anyway. I am sure people will point out the errors in my thinking. Be well.

[drox]

Ok guys, since I haven't got any real response on my previous questions, I'll layout all my concerns and let the group gel on it. I'm hoping to get credible responses from people who KNOW what they are talking about, not just THINK they know.

After/during the currency changeout from Saddam dinar to the new issue, the Fed Gub'ment passed a special law/resolution/whatever! allowing individuals in the US to buy and hold the new dinar. My issue is what is the fate of all the "3 zero" notes currently held by individuals and companies outside Iraq. Gov't holdings (any govt) outside Iraq is not my concern at this point. I am considering the fact that a "lop" or RD WILL come with some sort of RV on the rate (pre or post lop/RD).

1. Redenomination (is NOT a lop) - the current notes are removed from circulation and retain their value, but there is usually a time limit to change out the notes. Ex: a 25k note is exchanged for equivalent value in new denominations. This would be irrelevant to us if cashing-out immediately.

2. LOP - (is NOT THE SAME AS RD but IS a form of it) the current notes value changes relative to the ratio of change, Ex: a 25k note now equals a 25, a 10k=10, etc.. This requires the 25k to coexist with the 25 at the same value, but would also be time limited to change out. In the case of a LOP, we would need to hold the dinar to allow for increases in market value over time to make something of our investment. What mechanism would Iraq or the Fed place for the exchange of these denominations to valid currency notes within the time frame specified for the changout for notes held outside Iraq? One can't just fly to Iraq with a handful of notes, most of us can't afford it. A LOP would be a logistical nightmare for all the individuals, companies, and governments outside Iraq. Mostly just the individuals as govts and companies have the means to cover their collective arses. Will our own govt let us to take it up the wazzoo after "allowing" us to play this game? We'll see.....

"I've said m'piece and counted to 3..."

Oh Brother Where Art Thou

Fish

Whoops!!!! Sorry for the double post!!!

Fish... A Lop and a redenomination are the exact same thing. Your definition of a redenomination is what posters or false gurus have created to justify in their heads and their followers... how 3 zero removal could mean something else. Meaning, smaller denominations with the same value exchange for your big notes. That makes no sense in the world. Iraq wants to ease the use of cash transactions. That would make it nearly impossible to make cash transactions with a $1 RV and smaller denominations. Unfortunately, it is a myth that has been passed on and has become accepted as gospel. It is unfortunate. Our best bet (in my opinion) resides in no lop/RD at all. I personally would like to see them come out with the $100k notes to ease cash transactions, continue to improve the electronic banking, and work towards reducing the money supply some... while increasing the purchasing power through moderate bumps in the exchange rate. When things are more stable in Iraq they go international and see where it takes them. Hopefully somewhere comparable to the Saudi's rate. Again... just my opinion.

[kr88zy]

just remember this pre war 25k(iqd) was worth around 60k(usd)fact! if shiabi wants to give back wealth well there is your eq.

[Doctor Smith]

I've been listening to two actual currency experts on another sites copyrighted broadcast. They don't think it will lop. The removal of the zero's is the removal of the large bills in Iraq.

[shirtless91]

They better not LOP this... it wont work in their country.. and it wont work for us.

I've been listening to two actual currency experts on another sites copyrighted broadcast. They don't think it will lop. The removal of the zero's is the removal of the large bills in Iraq.

So this means that there will be an in country value and a out-country value basically?

[dinarck]

I've been listening to two actual currency experts on another sites copyrighted broadcast. They don't think it will lop. The removal of the zero's is the removal of the large bills in Iraq.

I disagree with that. If you refer to the DD CC then I wouldn't put any stock into what they are saying. If not please post which broadcast so we can hear for ourselves.