Dinar News Iraq Planning Currency Redenomination

[LittleMissGrits]

How can there be so many differing opinions on one article ... I don't trust the Iraqi's not one little bit on this RV thing panning out like we have hoped it would!!!

[Parkerafd]

BurntToast I'm afraid you could be right...Just makes too much sense....

[NineLives]

This could very well possibly be BurntToast, however, one thing to keep in mind is that there was never any mention of an RV only a Redenomination. Two separate things.

I think some people are confusing the two.

Wikipedia explains it best:

Due to inflation,t he same amount of monetary units have continually decreasing purchasing power. In other words, prices of the same products or services must be expressed in higher numbers. When prices reach a certain point, the high numbers can impede the well being of daily transactions because of the risk and inconvenience of carrying stacks of bills, strain on systems, e.g., automatic teller machines (ATMs), and because human psychology does not handle large numbers well. To address this problem, authorities can alleviate it through the process of redenomination. Redenomination is the process where a new unit replaces the old unit with a certain ratio. If inflation is the reason for redenomination, this ratio is some number larger than 1, usually a positive integral power of 10 like 100, 1000 or 1 million, and the procedure can be referred to as "cutting zeroes".[1] Recent examples include

A reval is something that has long been discussed on the forums and it is my opinion that this is not a reval.

FYI, I am a dinar holder as well but I refuse to have my mind clouded by opinions of others who are simply speculating on the possible outcome. I read & I listen but when push comes to shove,....I realize that no one person here or on any other forum really knows more than any other person, this is all just a guessing game or one can just read what the article states and use their own common sense. That's what I prefer to do.

As I previously said in another post,....my common sense tells me that they would not be giving an 11 month head's up. To believe that would mean that you also believe that everyone on the planet earth can go out and accumulate dinar and everyone on the planet will become rich by December. That would be like someone giving you the winning lottery numbers in advance,.....in a nut shell,....'not happening'.

For sake of argument lets say a loaf of bread in Irag costs 5000 IDQ, or $5 USD. No lets say there are the two IDQ circulating at the same time, a $5000 IDQ and a 5 IDQ. That loaf of bread would have to have two prices on it, 5000 IDQ and 5 IDQ. Once the 5000 note is out of circulation, the vender simply takes off loaf of bread the higher noted price, in effect lopping off three zeroes. A 5 IDQ is now 5 USD, a wash. The pricing (not the value) of the goods being purchased have to be changed also, i.e., revalued. This line of reasoning tells me that the 5 IDQ that is replacing the 5000 IDQ is the RV. Please, debunk this reasoning.

[supersoul]

I have 25,000 dinar notes, which at present time is about $20. Now with the larger notes it would take alot of dinar to give me change on a 50 dinar purchase. A lot of money to be carrying around so to eliminate that the larger bills need to be eliminated over time. I do think the reval will happen before this happens. It will be a whole lot easier to collect and eliminate the larger bills once a reval happens. If the reval were to hit, let's say, $1-$2 how many people would continue to hold on to their large notes. I think after the amount of waiting, very, very few would hold out for a higher rate. And more than likely the ones that won't trade them in probably already have them in a bank which could exchange and collect them up. JMO but people you invested for a reason and if you don't have faith that it will come to pass, guess what, it probably won't. Either way if you just make your investment back, what have you lost? Would the money have been invested in something else? Patience is the key. Don't believe all that's discussed here. Remember it's a rumor/speculation forum.

[thecure81]

anyone have a sick feeling that the 'talks' that maliki and iraqi president had with obama and biden had a great deal to do with all this? i never disliked a president(hated a man)as much as o. sad to say i guess.

[supersoul]

What would benefit the U.S. more? A reval or LOP? If their holding the amount of dinar that is rumored.

[NineLives]

Good practical thinking supersoul. You're just trying to make sense of everything yourself using your own judgement & common sense. No telling what can happen but I do think at the very least that we can break even. I've had it all this time (yrs.) I'm not about to throw in the towel just yet,....let's just all ride it out till the end of the year and see what happens. In the meantime, people,...don't get ahead of yourselves,.... stay grounded and certainly do not go out and buy/invest any more of your hard earned money in an already down economy.

I still stand by my beliefs that I don't think that we were given advanced notice of an impending RV with the recent news. But that's just me. We're all entitled to our opinions.

I have 25,000 dinar notes, which at present time is about $20. Now with the larger notes it would take alot of dinar to give me change on a 50 dinar purchase. A lot of money to be carrying around so to eliminate that the larger bills need to be eliminated over time. I do think the reval will happen before this happens. It will be a whole lot easier to collect and eliminate the larger bills once a reval happens. If the reval were to hit, let's say, $1-$2 how many people would continue to hold on to their large notes. I think after the amount of waiting, very, very few would hold out for a higher rate. And more than likely the ones that won't trade them in probably already have them in a bank which could exchange and collect them up. JMO but people you invested for a reason and if you don't have faith that it will come to pass, guess what, it probably won't. Either way if you just make your investment back, what have you lost? Would the money have been invested in something else? Patience is the key. Don't believe all that's discussed here. Remember it's a rumor/speculation forum.

[tabajam]

Thanks for the info

[Kent]

What would benefit the U.S. more? A reval or LOP? If their holding the amount of dinar that is rumored.

supersoul, Obviously an RV benefits everyone holding the dinar more than a lop... that is except the government of Iraq. For them an RV means borrowing a lot of money to pay the "holders" including the US. I don't believe you and I gain unless we stand in the way of Iraq's self interest.

What if they did a 3 zero lop and in conjuction with it did a small RV of 50% or even 100%? Or what if they let the value float after the lop. Iraq has a $95Billion economy now. How soon do you think it will double or tripple with all the oil contracts? No matter what they do after a lop, IMO the currency will double or tripple within a few years.

I have 2 fears with this investment. 1). That they can't keep the finatics from blowing up pipelines. 2). That the GCC deal happens too soon and they join it before getting the rate up to $3+ after the lop. (Remember that joining a rate mechanism will limit changes in the value.)

Even after a lop/redenomination, I think if we sit tight for a while, Iraq will become the fastest growing economy on the globe and we won't get rich, but will offset the dinar vendors mark-up and make 100-200%. The US Government can ride the same gain and it becomes a good thing for them as well.

[Huskycrash]

My question is if they drop three 0's off the 25k note how would that effect the local Iraqi people? The government of Iraq really doesn't care about us here in the U.S.A. but do need the people of Iraq to have confidence in them as leaders. If the decrease the value of the dinar to a point that it is worth so little compared to what they had yesterday then how would they react? If they have been paid or saved up the dinar and all of a sudden it loses so much value then what confidence would they have? I believe that they will make sure that they keep the people of Iraq as happy as possible in order to maintain power and by taking away a huge value in thier currency would not achieve this. I have no proof or documumented evidence but common sense tells me that the government will not allow the people to lose out on the money they have invested in the new government. Now, if the people of Iraq only hold a small portion of dinars and the international community is the major holder of the dinars in circulation then I could see them doing a LOP in order to maintain thier levels of investment in country. So the biggest question I have is what percentage of the dinars out there are held by Iraqi's and what percentage is held by others?

[drewzdinar]

Of course we ALL hope that the RV/RI happens first and the 25,000 dinar notes are collected and exchanged for 25 dinar notes. I know we have a lot of intel that tells us otherwise but what do you think we can expect? The loping of the zeros came up 4 years ago and now it has come up again but at a more serious level. With the debt that has been forgiven by countries such as China ($ 8.5 Billion) and the dinar that they have in their possession wouldn't they NOT want a devaluation of currency to take place. At this point taking off three zeros would basically make the dinar worth .000008 cents/dinar... unless they RV it at a 1:1 exchange then a 25 dinar note would be worth $25US and we would have made nothing or almost nothing. If the exchange rate was $3.22 US / $1 IQD then $25 IQD would be worth $80.50 US.

[afarns]

My question is if they drop three 0's off the 25k note how would that effect the local Iraqi people? The government of Iraq really doesn't care about us here in the U.S.A. but do need the people of Iraq to have confidence in them as leaders. If the decrease the value of the dinar to a point that it is worth so little compared to what they had yesterday then how would they react? If they have been paid or saved up the dinar and all of a sudden it loses so much value then what confidence would they have? I believe that they will make sure that they keep the people of Iraq as happy as possible in order to maintain power and by taking away a huge value in thier currency would not achieve this. I have no proof or documumented evidence but common sense tells me that the government will not allow the people to lose out on the money they have invested in the new government.

If the government takes 3 zeros off the value of the currency, then they also take 3 zeros off of the cost of everything in the country, so it doesn't negatively affect the Iraqi people in the least. Add to that the possibility of revaluing after the lop, and Iraq has a whole lot more international buying power, which is great for their economy - all without the possibility of hyperinflation or an unsustainable circulation figure. It actually make a lot of sense for the Iraqi government to lop and then RV. It just screws over what I'd hoped would happen for me personally.

[MoneyFreak]

Thanks for the update

[MoneyFreak]

thanks for the update

[Warmav]

I hold that they will take the three zeros. It makes sense. But there are two things that I cannot rectify. One Malki and the fellas have many more dinar than I and even if they have only a mere 8 mill than they get geat up with the rest of us. Their greed is no less ours. The second is if I deposited my dinar in say UBS or Warka, and I had 8million in an account, and no 25,000 notes when they redo their currency will I also lose 3 zeros on my account? If I depositied 8 mill would it not still be 8 mill? if so I like this at least it did not become $8000 of funny money sitting in my drawer. If this is true mabe this is where the PM's have their cash?

[super]

supersoul, Obviously an RV benefits everyone holding the dinar more than a lop... that is except the government of Iraq. For them an RV means borrowing a lot of money to pay the "holders" including the US. I don't believe you and I gain unless we stand in the way of Iraq's self interest.

What if they did a 3 zero lop and in conjuction with it did a small RV of 50% or even 100%? Or what if they let the value float after the lop. Iraq has a $95Billion economy now. How soon do you think it will double or tripple with all the oil contracts? No matter what they do after a lop, IMO the currency will double or tripple within a few years.

I have 2 fears with this investment. 1). That they can't keep the finatics from blowing up pipelines. 2). That the GCC deal happens too soon and they join it before getting the rate up to $3+ after the lop. (Remember that joining a rate mechanism will limit changes in the value.)

Even after a lop/redenomination, I think if we sit tight for a while, Iraq will become the fastest growing economy on the globe and we won't get rich, but will offset the dinar vendors mark-up and make 100-200%. The US Government can ride the same gain and it becomes a good thing for them as well.

Pan-Arab currency unlikely by ‘20

An article of interest? Maybe!

Pan-Arab currency unlikely by ‘20

Opinion: The Council of Arab Economic Unity says its 18 members will have a common currency within 10 years. Is that really feasible, given that even the smaller GCC monetary union is still up in the air?

Feb 8th, 2010

- Ben Flanagan

One of the less corny maxims attributed to motivational speaker William Arthur Ward centers on the importance of realism in everyday life. “The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails,” the American is quoted as saying.

Dr. Ahmad Juwaili, secretary general of the Council of Arab Economic Unity, could do with taking this on board when making overly optimistic predictions about monetary union in the Arab world.

In an article in today’s Asharq Al-Awsat newspaper (in Arabic here), Juwaili is reported as saying that a single Arab currency will be formed within ten years, following the successful establishment of an Arab Central Bank.

Juwaili does not mean the delayed, highly problematic GCC monetary union. He means a single currency for the 18 member countries of the Council of Arab Economic Unity. These include the six GCC states, and several other countries including Yemen, Egypt, Iraq, Lebanon, Libya, Sudan and Syria.

If, as Ward said, optimism is expecting the wind to change, then Juwaili’s claim is akin to a hurricane doing a U-turn.

For while monetary union has been the dream of the Arab world for more than half a century – and, certainly in political and cultural terms, has always made a lot of sense – the possibility of it happening by 2010 is highly unlikely.

Take the example of the smaller GCC monetary union. The Gulf states first ratified an agreement to “endeavour to establish a joint currency” way back in 1982. But the proposed 2010 deadline for the GCC common currency was abandoned last year, following the UAE’s withdrawal from the project, in protest at the decision to house the joint monetary council in Riyadh. Oman had already withdrawn, and has no plans to rejoin; a recent Reuters poll found that the remaining four countries are unlikely to form a monetary union before 2015 – and even that may be a little optimistic.

If a union of the hyper-rich GCC countries can prove so problematic, than it is difficult to see how a wider pan-Arab monetary union could happen any time soon.

Consider the European single currency, which became an official objective of the EU in 1969 – but was only adopted in 1999. Some European countries, such as the UK, have still not adopted the Euro.

The eurozone is made up of rough equals, and it took nearly half a decade for a single currency to emerge there. And so a union between countries as economically disparate as Saudi Arabia, Sudan and Egypt seems destined to failure in the short- and medium-term.

Still, Juwaili’s unrealistic deadline aside, a pan-Arab currency is certainly a worthy aim. Perhaps the successful formation of a GCC single currency could help pave the way – or rather, adjust the sails – for a wider economic union in the Arab world.

http://www.kippreport.com/2010/02/pa...y-%E2%80%9820/

[Kent]

Super, great info. Thanks.

[Kent]

I hold that they will take the three zeros. It makes sense. But there are two things that I cannot rectify. One Malki and the fellas have many more dinar than I and even if they have only a mere 8 mill than they get geat up with the rest of us. Their greed is no less ours. The second is if I deposited my dinar in say UBS or Warka, and I had 8million in an account, and no 25,000 notes when they redo their currency will I also lose 3 zeros on my account? If I depositied 8 mill would it not still be 8 mill? if so I like this at least it did not become $8000 of funny money sitting in my drawer. If this is true mabe this is where the PM's have their cash?

I think your warka becomes worth 8 Mil old dinar currency OR 8 Thousand new dinar currency which is of exactly equal value. Please take a look at the brochure bellypod posted to see how it works and is communicated when a redenomination is implemented. I think it will help.

http://www.reconversionbcv.org.ve/pdf/TripticoColorIng.pdf

Theoretically, the gain you might have in having a Warka (compared to me with bills) is that I might have to go to Ali or someone and pay a conversion fee to get the new currency. If Ali stuck to his $150 per mil rate on a lop, that would be a pretty good haircut to stay in the investment for the rest of the ride.

[Kent]

Warmav, one more thing. Looking at bellypod's brochure posting would be a helpful explaination. http://www.reconversionbcv.org.ve/pdf/TripticoColorIng.pdf

[ronscarpa]

***The fact that there are 25 Trillion Iraqi Dinar floating out therew scares me a bit when we consider an RV. That number would intimate a fractional RV rather than anything remotely approaching $1 - even considering their great Oil Reserve & Agricultural assets. We have to consider that there are only 2 Trillion US dollars floating around worldwide. Soooo, what do we think the IQD can reasonably be RV'd at. Personally I was hoping for something close to 1:1, but now I'd hope for $.10:1...! Only God knows where things will really go - even though some Iraqi officials have specific plans. All we can really do is "Pray" for favor (smile...!). Blessings to everyone. Stay happy and keeop the faith. We WILL come out OK in this venture. RON ***

[ronscarpa]

*** (Part 2 of my train of thought) Another thing that needs to be considered is the amount of IQD the US Govt is holding. The war cost the US about 710 Billion USD and is still counting. The numberr of IQD we are holding will need to cover thaty amount plus some - so I would assume that any RV would have to leave the US with at least $1 Trillion USD. I'll let the experts out there tell me what the most likely RV value will be. Blessings again - RON ***

[ronscarpa]

*** Most Iraqi people lost everything because of Saddam's invasion of Kuait, then the war. Their money went from about $3.20 US to $0.000855 now. That's a major DEVALUATION. I believe they are hoping for a significant increase against the $USD. Even $.01 US would be an improvement. I'm sincerely hoping for more for them and for us. As you indicated - how much is in Iraq and how much is worldwide. That's got to be a concern of the Iraqi Govt if they are to have any confiodence thjru-out the world. *** UID

[ronscarpa]

Kent,

Thanks for posting the Venezuelan chart. It was very informative, and gives insight...!

Be Blessed,

RON