Comparing to other currency revaluations

[RealisticLassie]

(I posted this in the opinions section a little while ago, but I wanted to add a bit to it and switch it to the rumor and speculation section for those who don't look in the opinions section)

There are many currencies that have re-valued in the past that most people looked right on past and didn't even bother to look into. I will not let another great investment, such as this one, pass me by. I believe this investment will be much similar (or exactly) to what happenend with the Turkish Lira. Before you freak out, keep in mind that this is not a bad thing it's actually a really good thing, unlike what most people are or were saying.

Let's look at the facts and history of the Turkish Lira. In 1946, a peg of 2.8 Lira= 1 U.S. dollar. In 1960, it was devalued at 1 Lira= 1 U.S. dollar. Then, Turkey started to experience chronic inflation between, the 1970's and 1990's which then resulted in depreciation in its currency's value. Towards the end of the year in 2001, the rate became approximately 1.65 million Lira= 1 U.S. dollar. (that's a lot of Lira for just 1 U.S. dollar!) The inflation rate then became more than 40% per year. In December of 2003, the Grand National Assembly of Turkey passed a law which would result in removing the six zeros from the Lira, thus creating a new currency. This was all introduced on January 1, 2005 and replaced the previous Lira, but the previous Lira was still valid in circulation until the very end of the year 2005. During January 2005 (wiki said it was revalued in July, but from the other articles i've read about this, it said it revalued in January when they dropped the zeros..it was probably just a typo) the Turkish Lira revalued at 1.29 New Lira= 1 U.S dollar (you could also use the older Liras during this time as well since they were still valid in circulation until the very end of that year). The Turkish Lira used to be the least valuable currency in 1995-1996 and 1999-2004. Within the past few years (after the deletion of the zeros), the Turkish Lira became stabilized and rose against the U.S. dollar as well as the Euro.

Here is a look at the history of the Iraqi Dinar so we can compare it to what happened with the Turkish Lira. In 1959, 1 dinar= 2.8 U.S. dollars, then rose to 1 dinar= 3.3778 U.S. dollars, then devalued by five percent which brought it to a rate of 1 dinar= 3.2169 U.S. dollars. In 1991, once the Gulf war ended, the Swiss printing that was used previously, wasn't available anymore. This resulted in a new inferior quality notes that were produced which became known as the Swiss dinar. Once the U.S. placed sanctions on Iraq and the International community and immoderate government printing of the new currency, the dinar devalued to 3,000 dinars= 1 U.S. dollar in 1995. Saleh has recently stated "the Central Bank has prepared all requirements needed to delete the zeros from the iraqi currency." Just as the Turkish Lira has done to their currency, all look at what happened after they did that...they did in fact revalue it!

Whoever was holding Turkish Lira during 2005 only had a about a year or so to profit off it before the older Liras became worthless. I think the same thing will happen with our large denomination banknotes, Iraq will drop the three zeros, then revalue the new currency, as well as the large banknotes for a short period of time before they become worthless at the end of the year.

It seems as if this same process is currently happening in Iraq. I believe what happened with the Turkish Lira will happen the exact same way with the Iraqi dinar just look at their history and similarities between the two situations each country has been faced with and the decision Turkey made with their currency. Wouldn't you think that Iraq is following the same track? Saleh keeps using Turkey as an example for what is happening with their currency, that could be a legitimate sign as to what the future holds for the Iraqi dinar.

I have posted the link to the Turkish Lira below for you all to read for yourselves. Let me know what you all think, all opinions are welcome!

http://en.wikipedia.org/wiki/Turkish_lira

[Dalite]

It was a ReDenomination not a revaluation

Any revaluation comes after the redenomination is complete.

RD first, then eventual RV.

[Captainron601]

This was already posted yesterday, let's move on people...

[Texas1]

Thanks for the post.....I learned something good today!

[RealisticLassie]

It was a ReDenomination not a revaluation

Any revaluation comes after the redenomination is complete.

RD first, then eventual RV.

That's what I said. They dropped their zeros (redenomination) then revalued their currency. But during the revaluation period, the older Liras (just like our larger denomination banknotes) were still legal tender until the very end of that year, so you still had time to profit before the currency became worthless. I think some people think they redenominated they currency and didn't revalue until after the old Liras were worthless, when in fact they were not worthless until the very end of the year, they still had time to cash in during that ONE year.

This was already posted yesterday, let's move on people...

Yeah, did you not read the very top of my posting "(I posted this in the opinions section a little while ago, but I wanted to add a bit to it and switch it to the rumor and speculation section for those who don't look in the opinions section)"

Why would you want to move on from this, this is actually really good and very informative. I believe it will help others better understand the process in which Iraq is planning right now.

[Don & Rocio]

That's what I said. They dropped their zeros (redenomination) then revalued their currency. But during the revaluation period, the older Liras (just like our larger denomination banknotes) were still legal tender until the very end of that year, so you still had time to profit before the currency became worthless. I think some people think they redenominated they currency and didn't revalue until after the old Liras were worthless, when in fact they were not worthless until the very end of the year, they still had time to cash in during that ONE year.

Yeah, did you not read the very top of my posting "(I posted this in the opinions section a little while ago, but I wanted to add a bit to it and switch it to the rumor and speculation section for those who don't look in the opinions section)"

Why would you want to move on from this, this is actually really good and very informative. I believe it will help others better understand the process in which Iraq is planning right now.

Exactly what I think will happen. They will RD in country but those of us outside the country will have a certain amount of time to exchange or cash in the 000 notes once it's on the FOREX. Thanks Lassie!

Edited June 29, 2011 by Don & Rocio

[NWGUY]

Thank you for the information. I have been saying all along, that the Iraq government, when they finally get their program together, will make it a very simple transition for the Iraqi people. I think this makes a lot of sense, and I hope it helps a lot of people in this investment.

The only thing now, is whennnnnn?

GO RV!!

[RealisticLassie]

Thank you for the information. I have been saying all along, that the Iraq government, when they finally get their program together, will make it a very simple transition for the Iraqi people. I think this makes a lot of sense, and I hope it helps a lot of people in this investment.

The only thing now, is whennnnnn?

GO RV!!

Hopefully once they finally drop the zeros That's what Turkey did, and turkey was once rated the least valuable currency in the world until they revalued in 2005!

[keepmwlknfny]

That's what I said. They dropped their zeros (redenomination) then revalued their currency. But during the revaluation period, the older Liras (just like our larger denomination banknotes) were still legal tender until the very end of that year, so you still had time to profit before the currency became worthless. I think some people think they redenominated they currency and didn't revalue until after the old Liras were worthless, when in fact they were not worthless until the very end of the year, they still had time to cash in during that ONE year.

Here is where I think the confusion is.....yes the NEW lira was revalued....but the old lira took 1 mil to equal 1 NEW and it was the NEW lira that had the new exchange rate....not the old.....

I dreadfully hope that I am wrong about this......it says nothing about the old being revalued, just the new.....so in our case if the dinar went one to one during this process, it would still take a 25k note to equal 1 USD.....1 25k old= 1 new dinar= 1 USD.......someone please prove this to be inaccurate!!!

[NWGUY]

Here is where I think the confusion is.....yes the NEW lira was revalued....but the old lira took 1 mil to equal 1 NEW and it was the NEW lira that had the new exchange rate....not the old.....

I dreadfully hope that I am wrong about this......it says nothing about the old being revalued, just the new.....so in our case if the dinar went one to one during this process, it would still take a 25k note to equal 1 USD.....1 25k old= 1 new dinar= 1 USD.......someone please prove this to be inaccurate!!!

I don't think there is any proof either way right now, my dinar brother. Unfortunately, we will wait to see. Someone is going to right, but who knows. Whether we all agree or not, we are in this together, and I certainly respect the information you provide Keep. Keep the faith, and things will work out!

[Midx1]

Not being negative here, but I lived in Turkey when this happened.

At no time when they dropped the zeros was my 1,000,000 (1 million turkish lira worth 1 million usd as some are expecting iraq to do with the large 25K notes to equal 25,000 usd.

My 1 million turkish lira became 1 turkish lira, worth the same on the exchange rate,,less than 1 usd!

Both currencies was in use until the larger notes were withdrawn.

I am not a lopster and hope they do not do the same like Turkey did with this.

There was no confusion at the shops concerning the exchange rate either,,just drop the zeros and buy what you want.

If you wanted 1 item that cost 1 Turkish lira then you could buy with the 1 Turkish lira note or buy with the 1,000,000 (1 Million) note.

This is what worries me when they keep comparing this to turkey.

[keepmwlknfny]

Not being negative here, but I lived in Turkey when this happened.

At no time when they dropped the zeros was my 1,000,000 (1 million turkish lira worth 1 million usd as some are expecting iraq to do with the large 25K notes to equal 25,000 usd.

My 1 million turkish lira became 1 turkish lira, worth the same on the exchange rate,,less than 1 usd!

Both currencies was in use until the larger notes were withdrawn.

I am not a lopster and hope they do not do the same like Turkey did with this.

There was no confusion at the shops concerning the exchange rate either,,just drop the zeros and buy what you want.

If you wanted 1 item that cost 1 Turkish lira then you could buy with the 1 Turkish lira note or buy with the 1,000,000 (1 Million) note.

This is what worries me when they keep comparing this to turkey.

So basically the new and old currency kept the old exchange rate until the redenomination process was over??

[RealisticLassie]

Here is where I think the confusion is.....yes the NEW lira was revalued....but the old lira took 1 mil to equal 1 NEW and it was the NEW lira that had the new exchange rate....not the old.....

I dreadfully hope that I am wrong about this......it says nothing about the old being revalued, just the new.....so in our case if the dinar went one to one during this process, it would still take a 25k note to equal 1 USD.....1 25k old= 1 new dinar= 1 USD.......someone please prove this to be inaccurate!!!

You made a really good point, I was a bit confused about that as well until I kept re-reading and researching and came up with this:

(I know what I am about to explain has already been said but I have to say it in order to make this example understandable)...

Let's take a 1,000,000 Turkish Lira and drop the six zeros to make it worth 1 New Turkish Lira. 1,000,000 Turkish Lira= 1 New Turkish Lira. Now, even though the revaluation came after the New Turkish Lira was introduced, the Old Turkish Lira was still legal tender until the very end of the year, therefore allowing you to take that old 1,000,000 Turkish Lira and trade it in for U.S. dollars instead of having them convert it into 1 New Turkish Lira. My theory is, since we are living in the U.S. and we use U.S. dollars, we won't have to go to Iraqi banks to trade in our notes for lower denominations, the bank tellers will take our 25,000; 50,000; etc. banknotes and give us cash in U.S. money. It won't matter weather it's the lower denominations or the larger ones, both will be legal tender until approx. the end of the year. You can't deny someone an exchange rate for the same currency just because one has more money on it (larger denoms) than the other (lower denoms). Both are legal, both will have the same value since the rate will (hopefully) be changing.

Thank you for pointing that out, i'm glad you did so people can through in their 2 cents on it, I would love to hear everyone's theory on this

[Dalite]

Not being negative here, but I lived in Turkey when this happened.

At no time when they dropped the zeros was my 1,000,000 (1 million turkish lira worth 1 million usd as some are expecting iraq to do with the large 25K notes to equal 25,000 usd.

My 1 million turkish lira became 1 turkish lira, worth the same on the exchange rate,,less than 1 usd!

Both currencies was in use until the larger notes were withdrawn.

I am not a lopster and hope they do not do the same like Turkey did with this.

There was no confusion at the shops concerning the exchange rate either,,just drop the zeros and buy what you want.

If you wanted 1 item that cost 1 Turkish lira then you could buy with the 1 Turkish lira note or buy with the 1,000,000 (1 Million) note.

This is what worries me when they keep comparing this to turkey.

Thanks for the first hand confirmation.

Some think RD gives a chance to negate it's purpose by allowing them to cash in their inflation laden notes at face value.

The basic concept of a RD is after an economy stabilizes, RD and put the currency system in good shape for future growth.

Then RV at a rate you can support and is competitive.

[2fast4u2c]

Or, when they talk about new currency they could mean introducing lower denominations.

I was going to go on and on, but you have all heard it (especially keepm) so one more day to go and we should know....

[Midx1]

So basically the new and old currency kept the old exchange rate until the redenomination process was over??

I did fluctuate a small amount but not in the millions as some think here.

really hope its all smoke and mirrors iraq is pulling here.

Turkey had really high inflation iraq seems to be more or less stable.

Yes it kept the same exchange rate.

Edited June 29, 2011 by Midx1

[RealisticLassie]

Not being negative here, but I lived in Turkey when this happened.

At no time when they dropped the zeros was my 1,000,000 (1 million turkish lira worth 1 million usd as some are expecting iraq to do with the large 25K notes to equal 25,000 usd.

My 1 million turkish lira became 1 turkish lira, worth the same on the exchange rate,,less than 1 usd!

Both currencies was in use until the larger notes were withdrawn.

I am not a lopster and hope they do not do the same like Turkey did with this.

There was no confusion at the shops concerning the exchange rate either,,just drop the zeros and buy what you want.

If you wanted 1 item that cost 1 Turkish lira then you could buy with the 1 Turkish lira note or buy with the 1,000,000 (1 Million) note.

This is what worries me when they keep comparing this to turkey.

Hi there! Thanks for your reply. Just curious, but did you try exchanging your (old) turkish lira for U.S. money? If so, did you try exchanging it in the U.S. or in Turkey? Since you lived in Turkey when this happened, do you know how they were able to change the exchange rate, yet allow for the old Liras to have the same exchange rate as the new ones (even in U.S.dollars). Usually, when you change the rate of the currency, as long as the larger ones and smaller ones are legal tender, they should have the same exchange rate as the other, hence 1 new lira= 1.29 U.S. dollars and 1 old Lira= 1.29 U.S. dollars. I'm just curious as to how they all made this work. I also find this odd, because someone I knew owned the old Lira and were able to profit of it in 2005, but they said they didn't have much time to do it before they switched currencies. (that's what they told me anyway, i'll have to reasearch some more about it)

Thanks again, for your reply!

Edited June 29, 2011 by RealisticLassie

[Rhorse]

I believe this can happen in Iraq, the way you described it happened in Turkey.

However, the recent history and situation with Iraq make it a unique investment... that's why there's so much speculation.... given its natural resources and its political renewal, Iraq could do something different, like a straight RV... or it could be an RD/RV, as you suggest.

Even with the statement about the "raising of the zeros," we just have to wait and see what actually gets done.... either way, it's exciting.

[2fast4u2c]

Rhorse...well put and I agree.

All we can do is wait til tomorrow.

[Don & Rocio]

Let's take a 1,000,000 Turkish Lira and drop the six zeros to make it worth 1 New Turkish Lira. 1,000,000 Turkish Lira= 1 New Turkish Lira. Now, even though the revaluation came after the New Turkish Lira was introduced, the Old Turkish Lira was still legal tender until the very end of the year, therefore allowing you to take that old 1,000,000 Turkish Lira and trade it in for U.S. dollars instead of having them convert it into 1 New Turkish Lira. My theory is, since we are living in the U.S. and we use U.S. dollars, we won't have to go to Iraqi banks to trade in our notes for lower denominations, the bank tellers will take our 25,000; 50,000; etc. banknotes and give us cash in U.S. money. It won't matter weather it's the lower denominations or the larger ones, both will be legal tender until approx. the end of the year. You can't deny someone an exchange rate for the same currency just because one has more money on it (larger denoms) than the other (lower denoms). Both are legal, both will have the same value since the rate will (hopefully) be changing.

This is what Im hoping for. What will the UST do with all the 000 notes?

[RealisticLassie]

This is what Im hoping for. What will the UST do with all the 000 notes?

This is all speculation and my own opinion of what might happen, I think the U.S. has obviously planned all this out with Iraq and once everyone in the United States cash in their banknotes for U.S. dollars the United States will then send the banknotes to their treasury where they will help keep them stored until all the iqd is gradually taken out of circulation or until the older banknotes become worthless. This is one reason why I believe this revaluation will happen, how else are they going to get all that iqd from those who own it here in the U.S? Obviously once people find out they can cash it in and profit off of it, everyone (or most people) will be taking their banknotes to the bank and cashing in, therefore allowing the U.S. to collect all the iqd here in the U.S. It's my belief that this has been the plan all along. Not only will the U.S. profit, but so will Iraq. This will help Iraq become more stabilized, and it will make it much more easier to deal with money over there, which is something they have been wanting to do for quite a while now. I hope this helps, and I hope i'm right! I guess we will find out

Edited June 29, 2011 by RealisticLassie

[nowhammies]

If the RD happens and then an RV gives me a return of 3k per 1k invested I will whoop my partners ars for getting me into this investment and subjecting me to this pipe dream for nearly 2 years.

Just saying.

[darleneR]

Newbie here, first i want to say thank you for a good communicatable discussion, without letting emotional feeling set in the body and destroy it. Secondly I want to say thank you for the information I can use with wisdom and come to a conclusion-with weighing all comments, facts together. I believe each has shed a light of recognition to be studied and/or proven/or believe has weight. Until then, I will continue to soak up all reasonable talks, facts and comments. Thanks again to all civil human beings, thus far.

[Midx1]

Hi there! Thanks for your reply. Just curious, but did you try exchanging your (old) turkish lira for U.S. money? If so, did you try exchanging it in the U.S. or in Turkey? Since you lived in Turkey when this happened, do you know how they were able to change the exchange rate, yet allow for the old Liras to have the same exchange rate as the new ones (even in U.S.dollars). Usually, when you change the rate of the currency, as long as the larger ones and smaller ones are legal tender, they should have the same exchange rate as the other, hence 1 new lira= 1.29 U.S. dollars and 1 old Lira= 1.29 U.S. dollars. I'm just curious as to how they all made this work. I also find this odd, because someone I knew owned the old Lira and were able to profit of it in 2005, but they said they didn't have much time to do it before they switched currencies. (that's what they told me anyway, i'll have to reasearch some more about it)

Thanks again, for your reply!

Since I was living in Turkey all money was exchanged there, it was the same rate for the old Turkish lira as the New Turkish Lira,,no difference in the rate with the USD exchange.

I never exchanged money in the USA during this time, but think the rate would not be much different minus the spread.

1 million Turkish lira exchanged was the same as 1 new Turkish lira when exchanged for USD.Sorry to bring bad news here as this is not what I wanted either when it comes to the Dinar.

Lets all hope something was lost in the translation of these articles.

[RealisticLassie]

So basically the new and old currency kept the old exchange rate until the redenomination process was over??

I'm a bit confused about that. The revaluation occured at the start of 2005, which means the exchange rate must have changed at that time. How can you change the exchange rate at the start of the year, but keep the old exchange rate until the year was over? Maybe if someone from Turkey during this time had come to the U.S. to try and exchange their money, it would have been different. I don't know just taking a guess. For all we know, the rules of exchanging the currency may have been different in the U.S. than it was in Turkey.

Edited June 29, 2011 by RealisticLassie