Bill to delete zeros sent to gov.!

[Realdinar]

You do realize that a country would never lop in the middle of a hyperinflation period right? They wait until they have inflation under control before they lop, which Iraq has gone through their hyperinflation period and they now have their inflation under control. So yes a lop makes sense. Do I want it to lop, no I don't but it is what will more them likely happen. Also I don't know why you think thy are destroying wealth with a lop. You take three zeros off the currency and the exchange rate. A 25k note will still be worth the same after a lop.

Acvording to your scenario, explain how a 25000 dinar note will be the same after a lop. If I go to buy a loaf of bread for 15000 dinars. I give the store owner a 25000 dinar note. He hands me a 10 dinar note back.

He actually owes me 10000 dinar. The value is printed on the note, in dinars. My note says 25000 dinars not 25 dinars or 25 dollars or whatever. So value has changed after the note has been spent. For worse.

Edited August 16, 2011 by Realdinar

[jg167]

Dinarck,

As much as I hope you are wrong I realize you have done many hours of research into the subject of the LOP(I hate even thinking about it ) If...and I say if, because I still want so badly to believe it will RV at a minimium of .10 cents. What happens to the dinar we hold. I have heard conflicting reports. Will we be able to get some of our money back minus the transaction fees, etc.?

"LOP" can mean different things, so I'll use RD for (re-denomination) instead. That is where a new currency is issued that exists with the old one for a pretty long period (6 months at least) and there is an exchange rate between them just like for any two currencies. Other countries have done exactly this to undo the effects of past hyperinflation. Will the dinar dealers be offering to exchange your current dinars for new ones? I'd guess so, but it might cost yet more of a spread, so even this service is available the question will be if you want to stay in or cash out and take your (possible) loses. Its not a happy result, but it seems pretty likely to me. I'd love an RV to 0.10 USD or even 0.01 USD, but I don't think its going to happen .

Acvording to your scenario, explain how a 25000 dinar note will be the same after a lop. If I go to buy a loaf of bread for 15000 dinars. I give the store owner a 25000 dinar note. He hands me a 10 dinar note back.

He actually owes me 10000 dinar. The value is printed on the note, in dinars. My note says 25000 dinars not 25 dinars or 25 dollars or whatever. So value has changed after the note has been spent. For worse.

An RD uses TWO different currencies. Your 25K IQD note is not the same dinars as the NEW 10 dinar note. The new 10 Dinar note is worth 10,000 IQDs. This is exactly the way in worked in say Venezuela with the Bolivar and the (new) Bolivar Forte, you can still see both symbols on currency rate sites.

[GinaG]

I agree with you jupitergirl. Stop with the lop word.

[hunz2]

Acvording to your scenario, explain how a 25000 dinar note will be the same after a lop. If I go to buy a loaf of bread for 15000 dinars. I give the store owner a 25000 dinar note. He hands me a 10 dinar note back.

He actually owes me 10000 dinar. The value is printed on the note, in dinars. My note says 25000 dinars not 25 dinars or 25 dollars or whatever. So value has changed after the note has been spent. For worse.

This has been explained over and over. 25000 dinar will equal 25 new dinar. The current exchange rate is .00086. So a 25000 dinar bill is worth about $21.50. With a lop a 25 new dinars will have an exchange rate of .86 which would be worth about $21.50. How is this so hard to understand.

[Realdinar]

This has been explained over and over. 25000 dinar will equal 25 new dinar. The current exchange rate is .00086. So a 25000 dinar bill is worth about $21.50. With a lop a 25 new dinars will have an exchange rate of .86 which would be worth about $21.50. How is this so hard to understand.

Its very hard to understand, it is a scam then. So you are stating that iraq cannot or will not rv their old notes. Only their new notes. Because they dont want to? instead of honoring the value of their current note, they decided to just print new ones and then rv.

[dinarck]

Thanks Tampa. Appreciate your civil reply. I will have to disagree but thats ok. Thats what this site is for. It would be boring if we all believed the same. My whole point is that Iraq is in a position for a redenomination. That is fact. We shouldnt be surprised if they have one. Maybe they wont but just the fact that they are about to vote on one should say alot. I dont want it to happen and I am hoping that it is smoke or a chess game as well but we will see. To tell you the truth I have been waiting long and hard for this vote just so that we will finally know something. If its yes then O well we move on. If its no then great we can all celebrate and all then agree that we are going to make alot of money. Just ready to see the vote already.

Its very hard to understand, it is a scam then. So you are stating that iraq cannot or will not rv their old notes. Only their new notes. Because they dont want to? instead of honoring the value of their current note, they decided to just print new ones and then rv.

Honoring the value of their current note? It has a value of around 25 USD.

Edited August 16, 2011 by dinarck

[hunz2]

Its very hard to understand, it is a scam then. So you are stating that iraq cannot or will not rv their old notes. Only their new notes. Because they dont want to? instead of honoring the value of their current note, they decided to just print new ones and then rv.

It's not a scam at all. Numerous countries have done the same thing in the past. The new currency will have a new value and the old currency will be worth it's existig value. Basically they are two different currencies that have their own exchange rate. They are not tied together.

[txwWrestling]

Just want this ride to come to a end!!! GO RV!~!!

[Realdinar]

Thanks Tampa. Appreciate your civil reply. I will have to disagree but thats ok. Thats what this site is for. It would be boring if we all believed the same. My whole point is that Iraq is in a position for a redenomination. That is fact. We shouldnt be surprised if they have one. Maybe they wont but just the fact that they are about to vote on one should say alot. I dont want it to happen and I am hoping that it is smoke or a chess game as well but we will see. To tell you the truth I have been waiting long and hard for this vote just so that we will finally know something. If its yes then O well we move on. If its no then great we can all celebrate and all then agree that we are going to make alot of money. Just ready to see the vote already.

Honoring the value of there current note? It has a value of around 25 USD.

Not after an rd, it will be worth the same as 25 dinar. The dinar value. Instead of honoring one note that says 25000 dinars, they are saying its actually only 25 dinars. So if they were to rv the currency of iraq, even if the iqd says 25000 it is only 25 dinar. Cmon.

It's not a scam at all. Numerous countries have done the same thing in the past. The new currency will have a new value and the old currency will be worth it's existig value. Basically they are two different currencies that have their own exchange rate. They are not tied together.

Ok, I got it now, thanks. So this is a pointless investment.

[hunz2]

Not after an rd, it will be worth the same as 25 dinar. The dinar value. Instead of honoring one note that says 25000 dinars, they are saying its actually only 25 dinars. So if they were to rv the currency of iraq, even if the iqd says 25000 it is only 25 dinar. Cmon.

Ok, I got it now, thanks. So this is a pointless investment.

I wouldn't say it is pointless. I think it will more then likely lop, but a small rv might be possible.

[dinarck]

Not after an rd, it will be worth the same as 25 dinar. The dinar value. Instead of honoring one note that says 25000 dinars, they are saying its actually only 25 dinars. So if they were to rv the currency of iraq, even if the iqd says 25000 it is only 25 dinar. Cmon.

Ok, I got it now, thanks. So this is a pointless investment.

The old currency retains its exchange rate. The new has its own exchange rate. Its that simple. Zimbabwe had notes with 50 trillion on their face value. Do you think they ripped off investors by not honoring that amount?

[Darin]

Thanks Tampa. Appreciate your civil reply. I will have to disagree but thats ok. Thats what this site is for. It would be boring if we all believed the same. My whole point is that Iraq is in a position for a redenomination. That is fact. We shouldnt be surprised if they have one. Maybe they wont but just the fact that they are about to vote on one should say alot. I dont want it to happen and I am hoping that it is smoke or a chess game as well but we will see. To tell you the truth I have been waiting long and hard for this vote just so that we will finally know something. If its yes then O well we move on. If its no then great we can all celebrate and all then agree that we are going to make alot of money. Just ready to see the vote already.

Honoring the value of their current note? It has a value of around 25 USD.

From my understanding, a re-denomination can have a positive effect for us. If lower denominations were introduced to coincide with the current notes, that would be considered a re-denomination. Just like an argument or quote I heard from a few separate people that goes as follows: "Not all re-denominations are LOPs, but all LOPs are re-denominations."

Every day, it appears that this argument goes back and forth. Upon every article listed, printed, and linked to this site brings forth people who make the argument towards one way or another. We all understand, it is quite possible that the IQD may LOP, but it doesn't make it 100% fact.

I continue to read from all sources to try to further educate myself upon the bigger picture. From how the processes of certain thing(s) work, to stats & data, to other pertinent information.

The more I dig, the more I find that the information is quite complex and very hard to understand for just myself.

A couple things of recent that I have read and found interesting.

Sterilization funds: They're listed on the CBI financials, but not accounted for when calculating value. Their liquid, but excluded, and likely used to help maintain certain rates. This is likely one method or tool they used to maintain the current exchange rate. Sterilization funds are create to help prevent negative effects on an economy that endures an excessive amount of revenue (such as sales of oil).

Monetary bases: I argued that they were done differently.. Someone argued against that, I found out I was right through a link.. They're very similar, but small details change the equation on how certain M1, M2 figures are accounted for. I.e., what may be included for M1 in one country is excluded from another countries M1 yet included in M2. (as an example)

A recent 7-year study was completed on their minerals. Mid September they are having an auctioning of bids for those minerals, on production, etc. This should help create revenue, jobs, and so forth.

If I recall, the US has an agreement with OPEC that expires in 2013. This is the 40-year deal to sell crude in US on the market. That deal expires in 2013. I can't imagine another 40-year extension, so one has to wonder what sort of new deal exists. Are we switching back to a gold-based currency? Would explain the rush to the gold in the market place. As gold continues to rise, this theory may hold quite a bit of substance. I know gold can act as a safehaven during rough economic times, so a recent downgrade in credit rating may spook people.

Bonds - The GOI holds roughly 89 billion in US bonds. Nothing quite substantial, but, money is money, right? Under OPEC guidelines, they are required to buy US debt as the sale of crude is sold in USD.

Now we have China making a claim they won't buy our debt any longer, an oil deal that may soon expire which may lead to less countries buying our debt, and no one really speaking of this future issue.

.... So, there must be a plan somewhere... With something.... To help solvet his crisis issue.....

[Realdinar]

The old currency retains its exchange rate. The new has its own exchange rate. Its that simple. Zimbabwe had notes with 50 trillion on their face value. Do you think they ripped off investors by not honoring that amount?

I dont know anything about zimbabwes currency. Id rather discuss iqd. Diversion wont answer my question.

The new has its own exchange rate. Why? Because they cant figure out how to rv and honor what the dinar value is stated on the iqd? So they are scamming us? By asking us to trade in the old notes for the new ones without zeros. Thennnn they rv. Is that honest and honorable?

[dinarck]

Hope so Darin or we are screwed. Lol. Thanks. All good points.

[dinarck]

I dont know anything about zimbabwes currency. Id rather discuss iqd. Diversion wont answer my question.

The new has its own exchange rate. Why? Because they cant figure out how to rv and honor what the dinar value is stated on the iqd? So they are scamming us? By asking us to trade in the old notes for the new ones without zeros. Thennnn they rv. Is that honest and honorable?

Its not diversion its fact. It has been done in numerous countries. Iraq doesnt owe you millions for buying their currency. Hopefully they will give us millions but they dont owe us millions. Haha

[Realdinar]

Its not diversion its fact. It has been done in numerous countries. Iraq doesnt owe you millions for buying their currency. Hopefully they will give us millions but they dont owe us millions. Haha

I didnt say iraq owes me millions, they owe me what is stated on the note. Currently, it is their currency and its worth 1170. After an rv the dinar will exchange for more, or should because its the right thing to do. Its called morals, ethics, etc.

What if I wrote a check to you and it could not be cashed? Haha. Actually not haha, right? Cmon, man.

Edited August 16, 2011 by Realdinar

[dinarck]

I didnt say iraq owes me millions, they owe me what is stated on the note. Currently, it is their currency and its worth 1170. After an rv the dinar will exchange for more, or should because its the right thing to do. Its called morals, ethics, etc.

What if I wrote a check to you and it could not be cashed? Haha. Actually not haha, right? Cmon, man.

All I can tell you is good luck with that. Maybe it wont RD at all and our discussion would be irrelevant.

[Darin]

Hope so Darin or we are screwed. Lol. Thanks. All good points.

Well, lets consider the outcome if this is not prepared for correctly.

Upon crude no longer being traded on the market in USD... The demand for USD alone would drop significantly. (Maybe.... 30%?)

Than, the oil producing (Opec) countries, would no longer be buying US debt... Giving us a huge spending problem.

The only benefit that would be gained, is the value of the bonds would likely be easy to pay off in other currencies... (Falling dollar)

But costs of imports would increase and our economy would likely struggle in many sectors.

Maybe we start doing our own domestic drilling..... Ehh, production does not seem adequate to fuel the nation, so I wouldn't think that...

What would crude be sold in? the Pound? maybe IQD?

Unless the U.S. does another agreement.... Than all problems solved..

[dinarck]

Well, lets consider the outcome if this is not prepared for correctly.

Upon crude no longer being traded on the market in USD... The demand for USD alone would drop significantly. (Maybe.... 30%?)

Than, the oil producing (Opec) countries, would no longer be buying US debt... Giving us a huge spending problem.

The only benefit that would be gained, is the value of the bonds would likely be easy to pay off in other currencies... (Falling dollar)

But costs of imports would increase and our economy would likely struggle in many sectors.

Maybe we start doing our own domestic drilling..... Ehh, production does not seem adequate to fuel the nation, so I wouldn't think that...

What would crude be sold in? the Pound? maybe IQD?

Unless the U.S. does another agreement.... Than all problems solved..

In my opinion the US is holding back drilling our oil for a reason. I doubt it has to do with pollution or anything like that but possibly an ace in the hole if you will. We either consume the worlds first or use our resources as a bailout as you speak of. Using my phone now but would like to continue the conversation when I get home.

[countryroads]

I wish this would get over too. I'm like a kid shaking the wrapped presents under the Christmas tree. GO RV

Edited August 16, 2011 by countryroads

[Darin]

In my opinion the US is holding back drilling our oil for a reason. I doubt it has to do with pollution or anything like that but possibly an ace in the hole if you will. We either consume the worlds first or use our resources as a bailout as you speak of. Using my phone now but would like to continue the conversation when I get home.

That may be... But I believe the reason(s) are bigger than that...

Why consume your own when your only competing with yourself.

Therefore, consume others to maintain a high valued currency and have foreign countries buying your debt.

The obvious choice would however be to pump our own if the USD lost its status as the petro-dollar.

I forgot to mention that upon losing the petrodollar status, we would lose demand & OPEC countries buying debt.

I would also foresee that we would lose the #1 reserve status... Which may mean more foreign USDs coming back to the states.

Could be quite disastrous...

No plan seems to be in action, to the public anyways...

[keylime]

For instance, in January 2005, Turkey replaced its currency (the Lira) with the New Turkish Lira (YTL), with a conversion rate of one million old lira to one new lira. I think that would be considered a lop. IMO if it were one old to one new it would not be.

Saleh estimated the government will exchange more than 30 trillion Iraqi dinars, or more than $26 billion dollars. The most important change after deleting the zeros, is to reduce the number of banknotes in circulation, simplifying the payment system in Iraq.

Now this article sounds like they will exchange 1 old for one new IMO

After having read the entire Dropping Zero's Defined Paper I find in no way does Iraq fit the so called "lop" scenerio. As you point out from that article they have printed "more than 30 trillion Iraqi dinars" to replace what is already in circulation. Then the statement, "the most important change after deleting the zeros, is to reduce the number of banknotes in circulation....". These two facts alone solidify that the "deleting of zeros"(which has been quoted as being off of the 'nominal value') is not going to "reduce the number of banknotes in circulation" thus nullifying the "lop scenerio", but they are going to "reduce the number of bank notes" AFTER, AFTER, AFTER they remove the zeros from the nominal value by raising the value of the dinar via an exchange rate increase.

Read the paper that was posted and there is no other conclusion to come to when you couple it with the two statements above. Iraq will increase the exchange rate because they want the people to stop using the USD, and they want to increase the confidence in the dinar for their own people as well as outside investors.

[tjmunson]

It has nothing to do with anything but I always find it odd that many articles spell Shabbs' spin doctors last name Saleh and then later on in the same article they spell it Salih. Quite odd.

Great post. I think we are on our way.

Peace

[jg167]

It's not a scam at all. Numerous countries have done the same thing in the past. The new currency will have a new value and the old currency will be worth it's existig value. Basically they are two different currencies that have their own exchange rate. They are not tied together.

No this is wrong. The two currencies ARE tied together. For example if the RD 1000:1 then the current IQD dinars would be worth 1/1000th of a new XID (my symbol) dinar. If an RV (before or during the RD) were to occur both old and new dinar currencies would go up or down by the same proportion, but the 1000:1 old:new remains fixed. Edited August 16, 2011 by jg167

[teresa43]

This could be the evidence of what we've been waiting for. Let's hope they delete the zeros like we want them to - .00086 to .86!!

Deputy Governor of the Central Bank, on Monday, said the central bank raise the bill to delete the zeros of the Iraqi currency.

this sounds like a LOP to me, .00086 is the exchange rate