The central bank's plan for reducing its Iraqi dinar

[Mstr_William]

12th paragraph states that the old currency will remain in circulation along with the new. Doesn't sound like lop to me. Sorry they wouldn't use the old currency with the three zeros at all if it was to lop. I could be wrong, but I'm thinking not this time.

Go Iraq, Go Rv

my thoughts exactly.

[nemesis760]

THAT DOESN'T MEAN THEY CAN JUST DECIDE THEIR MONEY SUPPLY IS WORTH 59 TRILLION USD. If you need money to pay your mortgage can you just decide that the 1 USD you have in your checking account is really 1,000 USD?

I read a good point in another thread last night, that the 59 trillion is estimated to be a bloated or enhanced number, counting the out of circulation as well. Possibly meaning the old Saddam dinar. The amount that the poster was referring to was actually 30 trillion in currency. Considering that the US has just north of that 59 trillion number in currency (I believe) I too see how that could be difficult and struggle to reason an RV with glaring numbers like that. However, I think the actual amount of dinars in currency is significantly lower than announced. Based on the track record of great bookkeeping by the Iraqi government.

This is all a guess, yes, i did think about it first.

[EagleEye]

Thanks for the post.... I found THIS the most interesting quote in the article and no one seemed to catch it (unless I missed something in the thread):

Mohammed Saleh refused to set a date to launch new dinar, saying that the management reform of the national currency a strategic project, but stressed that the central bank will be within a month of the implementation of an integrated plan to the Cabinet the last word in this regard.

GO RV !!

[R Veyron]

Why would they be so worried about the public's confussion if the two curriencies in circulation would be at the same rate of exchange ? Rather one would be at a higher rate and the older would take more to equal the new while the process is ballanced out and they become familiar with how to do business as usual. Just a thought.

[Aquarius]

The central bank's plan for reducing its Iraqi dinar

04.08.2011

Faris Omar

The oil wealth and progress of the proceeds of abundant, secure the cover of the national currency with the Iraqi dinar has become one of the strongest currencies in the Middle East.

The central bank has the distribution of foreign exchange reserves in a basket of currencies like the dollar and the pound sterling and the Japanese yen as well as its reserve of gold so that the cover of the Iraqi dinar remains strong, regardless of fluctuations in the currency market.

Until the early eighties was the Iraqi dinar equivalent of more than three dollars U.S., but the damage to the Iraqi economy since the invasion of Kuwait at this time 21 years ago and subsequent wars and international sanctions, ensured all firing runaway inflation destroyed the value of the Iraqi dinar so that the price now spent more than a thousand dinars to the dollar.

Coupled with the erosion of the value of the currency and banking financial difficulties and administrative and accounting are still different, especially in trade and handle daily cash.

Faced with this situation since the central bank decided early in 2010 a plan to drop three zeros from the Iraqi currency nominal and pave the way for a gradual procedure that preserves the purchasing power and prevent the exposure of the Iraqi market to the economic turmoil hurt consumers.

Radio Free Iraq adviser met with the Central Bank of the appearance of Mohammed Saleh, who reviewed the falling value of the Iraqi dinar, referring to the deletion of zeros is part of a project to reform the management of the national currency.

The Chancellor said Mohammed Saleh, the burden posed by the mass cash payment system, as reflected in the revenue budget figures, for example, trillions. Mohammed Saleh pointed out that the draft dropping zeros from Iraqi dinar is based on optimistic forecasts the prospects for the development of the Iraqi economy in the coming period.

He revealed the central bank adviser said the bank plans to return to the coin because of their preferences on paper currency, especially from small groups that are not worth the trouble worth dealing with.

Mohammed Saleh refused to set a date to launch new dinar, saying that the management reform of the national currency a strategic project, but stressed that the central bank will be within a month of the implementation of an integrated plan to the Cabinet the last word in this regard.

Expert in the Ministry of Finance Crescent Miller predicted that the result in the deletion of zeros from lower inflation, noting that countries such as Turkey and Brazil prior to Iraq in this area.

Miller noted the characteristics of the new currency trading is expected after this procedure, including the adoption of the three languages ​​are Arabic, Kurdish and English, only the symbols of civilization and to prevent the use of pictures of any official.

The expert in the Ministry of Finance on the conviction that the process of replacing the currency will be smooth, especially as the old currency will remain in circulation alongside the new currency of time to allow a gradual withdrawal of steps does not affect the daily exchanges.

Economic analyst, Basil Jamil Antoine ruled economy is affected by changing money, but called for an awareness campaign to prepare public opinion and to the logistical procedures in financial institutions involved.

One benefit of the consumer citizen is expected to result directly delete the zeros of the possibility of using vending machines that are still unknown in Iraq because of the technical and practical difficulties in the mobilization of these ATMs in Iraqi dinars now.

Contributed to the file via Radio Free Iraq in Baghdad, Khalid Waleed

http://translate.google.com/translate?u=http%3A%2F%2Fwww.iraqhurr.org%2F&langpair=ar|en&hl=en&ie=UTF8

It's hard to see where one would find anything referencing a LOP here:

Paragraph one tells the reader that there is plenty of oil to cover the national currency, and that the dinar is one of the strongest currencies in the ME.

Paragraph two tells the reader that the cbi has reserves in several currencies, so the dinar will remain strong no matter what US politicians do to the USD.

Paragraphs three and four explain how the value of the dinar plummeted

Paragraph five uses the word "nominal" together with the phrase, "...pave the way for a gradual procedure that preserves the purchasing power and prevent the exposure...", and paragraph six finishes the thought by stating the the dropping of the zeroes is "...part of a project to reform the management of the national currency". This means (IMO) that all the zeroes makes management of the national currency a nightmare, both for accountants and programmers.

Paragraph seven expounds on five and six by referencing the "...burden posed by the mass cash payment system.....for example, trillions." This paragraph ends in a statement the dropping the zeros is "...based on optimistic forecasts the prospects for the development of the Iraqi economy in the coming period."

Paragraph seven says the opposite of a LOP, because you don't LOP to increase trading value of a currency.

Paragraph eight tells us again that they're going to start using coins because paper is "...not worth the trouble worth dealing with."

Paragraph nine tells us that the cbi is within a month of bringing their integrated plan for the entire process to the Cabinet, where the last word of approval resides.

Regarding paragraph ten, this link might be helpful: http://www.thestatesmanonline.com/pages/news_detail.php?section=2&newsid=3642

Which brings to the front of my mind that they may keep referring to Turkey and Brazil because those were two countries whose redenominations failed because of weak economic indicators. They are probably attempting to compare to show that Iraq's redenomination (a piece of the integrated plan) would be successful because of the robust health of their economic picture (see first paragraphs).

Paragraph eleven describes the new currency.

Paragraph 12 reassures that the process will go smoothly, and that "...the old currency will remain in circulation alongisde the new currency of time to allow a gradual withdrawal...", and that this piece of the process won't affect the daily exchanges.

Paragraph 14 explains that one of the main reasons for the redenomination is to make it possible for Iraqis to use ATM machines.

In summary, what this article means to me is that they are going to redenominate first, to get their house in order so that they can then complete their goal of returning the "glory" of their currency.

The only question I have is whether the large notes will stay a viable currency for foreign investors (us, for example), as is the case with the $1000 USD note, or if they will give a finite period of time for the larger denoms to be turned in (as is sometimes the case in England). And if the latter, will the revalue happen in time for us to easily turn in the larger denoms, or will we need to find another way (i.e. currency dealers).

[flahenry]

Because what they are saying is they are removing three 000's from the currency not the exchange rate. I hope its not a lop but they also keep mentioning Turkey also.

Does it make any since to feel when they Iraqis mention Turkey they mean learning from Turkey? What not to do and avoid ending up like Turkey?

[Carrello]

Oregon...I hope it is a translation issue but just reading the articles almost all of them read the same. Let's hope we are wrong.

Aren't all of the articles being translated from Arabic, or have you found originals written in English? Otherwise, the translation, it seems to me, would be the same.

[bostonangler]

Explain how these numbers are bad.... Thanks

2001 — 1 U.S. dollar = 1,650,000 lira

2004 — 1 U.S. dollar = 1,350,000 lira

2005 — 1 U.S. dollar = 1.29 new lira (The use of New Turkish Lira, which drops 6 zeros from the currency Turkish Lira, was implemented in 2005)

2007 — 1 U.S. dollar = 1.26 new lira

2008 — 1 U.S. dollar = 1.55 new lira

2009 — 1 U.S. dollar = 1.48 new lira

2010 — 1 U.S. dollar = 1.44 lira (Turkish Lira and New Turkish Lira were used together in 2005. In 2010, the name was converted to Turkish Lira, but New Turkish Lira was used as currency until 31 December 2009)

[utah rock]

Has a LOP ever been successful in bolstering an economy? Just wondering? Don't think it worked for that power house we know of as Turkey, or did it? Wait for the sky to fall before ya freak out... or freak out, don't really care. Go RV

[Dalite]

Has a LOP ever been successful in bolstering an economy? Just wondering? Don't think it worked for that power house we know of as Turkey, or did it? Wait for the sky to fall before ya freak out... or freak out, don't really care. Go RV

I can't address a LOP, but if you are referring to a ReDenomination, look at the figures in the post above the one where you asked the question.

From the figures, it looks like they did pretty good.

Their money is valued about 5 times higher than Saudi Arabia, so you will have to decide if that is just some of that smoke and mirrors we all read about.

After all, those encyclopedias and financial trade magzines may be in on it too.

[BlueOrchid919]

Why does everyone assume that removing 3 zeros is off the dinar and not off the exchange rate?

Not :

25,ØØØ dinar = 25 dinar

But instead:

Exchange rate:

.ØØØ85 = .85 (removed 3 zeros)

Probably because many news articles have come out stating there will be no change in the value. An OLD 1000 dinar note will be equal to 1 NEW dinar note. Value stays the same. A loaf of bread that costs 1000 OLD dinars now, will cost 1 NEW dinar once they introduce the new currency. Both the OLD currency and the NEW currency will co-exist for a certain time - Shabibi has stated it could be up to 2 years.

The coinage will be for denominations under 1 dinar. Just like our quarters, dimes, nickles and pennies. Can you imagine having banknotes for 5 or 10 cents???

I can't address a LOP, but if you are referring to a ReDenomination, look at the figures in the post above the one where you asked the question.

From the figures, it looks like they did pretty good.

Their money is valued about 5 times higher than Saudi Arabia, so you will have to decide if that is just some of that smoke and mirrors we all read about.

After all, those encyclopedias and financial trade magzines may be in on it too.

Great answer!

I was kinda thinking Google was in on it too!

[PD46]

This article wasn't written by a reporter working for Free Radio Iraq, right? Nuff said, because it's not unbiased, objective journalism. Why?

That's like asking MSLSD, oops I mean MSNBC, to tell the 3 people that watch their network about how great and wonderful Dumb-o-crats are. DUH!!!!

Free Radio Iraq has never written or posted any type of article that wasn't pro-LOP.

Free Radio Iraq is a LOP supporter as all of the mainstream media networks are extensions of the Democratic party.

[2fast4u2c]

Carello...apparently your not aware that there are several different translation models. In addition arabic does not translate into english well at all.

[blessedman]

THAT DOESN'T MEAN THEY CAN JUST DECIDE THEIR MONEY SUPPLY IS WORTH 59 TRILLION USD. If you need money to pay your mortgage can you just decide that the 1 USD you have in your checking account is really 1,000 USD?

25,000 dinar? 21 dollars? Woah, big spender, take it easy.

I can afford 21 dollars.......................can you afford 21 thousand dollars.......................DEAL OR NO DEAL.........................got cohones enough to put your money where your mouth is.........how strong is your conviction to your opinion???????

[dinaronmind/mindondinar]

bump

[detroitjazzman]

What's for dinner? Smells like lop to me!

How do you get a lop from this statement? "The expert in the Ministry of Finance on the conviction that the process of replacing the currency will be smooth, especially as the old currency will remain in circulation alongside the new currency of time to allow a gradual withdrawal of steps does not affect the daily exchanges.