The Wildcard

[andy3978]

There seems to be a consensus here that the IQD will do 'something' relatively soon. There's the issues of HCL, Ch. 7, GOI etc which have been talked about as having great importance or other trains of though indicate they are mere details. Whatever

The CBI has been issuing statements lately in a furious fashion. The indications point to removing the 3 zeroes; for all intents and purposes a LOP. Whatever

Most here seem to be in agreement that the Iraqi money supply is grossly inflated. Numbers range from 20-27 trillion in circulation. RV'ing that amount of currency at even 1:1 would make Iraq's money supply worth 20-27 trillion dollars. This is more than the USA has out on the street. It's pretty much unsustainable. Whatever

Here's the caviot: The CBI has been buying dinars in exchange for USD's to the tune of $200 million (give or take) per auction. At 5 or even 4 days a week for the last 5 years...that's a hell of a lot of Dinars they would have removed from circulation, effectively drastically reducing the money supply (an in effect 'removing' the zeroes from the currency).

Now there are documents showing their money supply out there, but we don't know how accurate it is and not sure if it accounts for notes being removed from circulation via the auctions.

So wouldn't removing a bunch of notes out of circulation yield the same results as simply lopping 3 zeroes off the notes? Sure it would. The end result is the money supply has been shrunk.

It is evident that the CBI will not be 100% accurate towards their intent. If they were to telegraph their punches, speculators would go wild and storm the market.

As of late I have been soured by the way things have been slooooooowly creeping along and have developed a negative feeling towards this investment. After some common sense re-evaluating of the situation (above) has made me feel a little better.

One thing for sure is that any opinion (lop or non-lop) is pure conjecture and only the good Doctor knows for sure how this thing will play out. It comes down to how one defines 'removal of zeroes' or 'renomination'. For all we really know, the RV process has been ongoing for years now in the form of redenominating the IQD via the auctions. THEN the RV.

People are saying they will RD then RV. Hell, maybe the RD part has been going on right under our noses for years now. Maybe it's time for the RV part to occur. Just some thoughts.

[PUNT18]

Andy,

I agree totally. I actually posted a short and sweet question just last week regarding this very same subject.

The CBI, is in effect "selling" USD in return for IQD in their daily auctions. When you convert the USD amount into IQD equivalent, you are very correct in stating that literally trillions of dinar have been "brought" back into the CBI's control.

You raise good questions regarding the accounting measures taken to accurately report these actions. One would assume that their money supply statistics would have to reflect the reduction and I would tend to agree.

However, these accounting measures would only come into play when Iraq "officially" retires the money. If, and I mean IF, they are simply holding the dinar currently (meaning that it is still technically a part of the money supply just not in use on the street) then their reporting statistics would not be changing on a monthly basis.

Can they all of sudden, say at the end of a fiscal period (09/30/2011), make a one time accounting adjustment to reflect any and all dinar that has been officially "retired" from circulation????

IDK - but it sure is a compelling way to look at it.

GO RV!!

[andy3978]

You raise good questions regarding the accounting measures taken to accurately report these actions. One would assume that their money supply statistics would have to reflect the reduction and I would tend to agree.

I agree with you. I'd assume their figures would reflect any monies retired, but year after year it seems the money supply figures they publish seem to stay pretty much the same. Their figures dont appear to lower by virtue of the money brought in from the auctions.

Can they all of sudden, say at the end of a fiscal period (09/30/2011), make a one time accounting adjustment to reflect any and all dinar that has been officially "retired" from circulation????

I don't know if they can or can't. If they CAN in fact do this, it would be a good way of keeping their poker face on and not telegraphing their punch!

[vvalley]

I like the way you think andy3978! Goooooo Rvvvvvvv

[andy3978]

Here's what I mean. This is the auction results from the auction on 9-15-11

DETAILS NOTES

Number of banks 23

Auction price selling dinar / US$ 1170

Auction price buying dinar / US$ -----

Amount sold at auction price (US$) 194,983,000

Amount purchased at Auction price (US$) -----

Total offers for buying (US$) 194,983,000

Total offers for selling (US$) -----

For each One Dollar the CBI pays out, they receive 1,170 IQD.

This day the CBI paid out $195 million (rounded for easy math).

So take $195,000,000 and multiply that by 1170 (IQD) and you get 228,150,000,000. That's just over 228 billion IQD now back in the coffers of the CBI. The question here is, do they destroy/retire these notes? Are they holding this money in a vault (and accumulating it) in order to keep the 24 trillion dinar figure out there so in one fell swoop they can set it on fire and reduce their money supply in order to RV the remaining (and sustainable) money? This way they wont show their hand?

I cannot answer this question, but it does seem to make sense as an alternative to that basterdly lop.

[PUNT18]

:twothumbs:

Right there with Andy!!

Go RV!!

[bobab]

I smell embezzlement. If we don't know what they take in (dinar), but we know what is going out (dollars), Hummmmmmmmmmm

[zigmeister]

Andy good post. 20 Million has alot of detail info imo. Just recently posted thought you might be interested if you have not read it.

My link

[NonLinear]

Andy good post. 20 Million has alot of detail info imo. Just recently posted thought you might be interested if you have not read it.

My link

And a mighty fine post indeed!

[donnydoright]

So here's the thing about removing notes to have the same effect of removing three zero's with a lop

lets assume that brings the currency in circulation down to 27 billion....The problem is the denominations of the notes they have in circulation right now...with a population of about 31 million people....27 billion divided by 25,000 dinar notes is only 1,080,000 notes...now granted not every note they have is a 25,000 dinar note...but if you do the math, with 50 dinar notes you only get 540,000,000 or about 18 dinars per person....They need to RV along with the pulling notes out of circulation...otherwise everyone only has about .02cents in wealth...there just wouldn't be enough to go around

Thats why, while a RD stinks, it works...you RV as well as reduce the currency in circulation.....with a RD you still have that 27 billion dinars or 18 dinars per person...but they are now worth $15.48 its still WAY to low, but Iraq isn't quite America

[PUNT18]

So here's the thing about removing notes to have the same effect of removing three zero's with a lop

lets assume that brings the currency in circulation down to 27 billion....The problem is the denominations of the notes they have in circulation right now...with a population of about 31 million people....27 billion divided by 25,000 dinar notes is only 1,080,000 notes...now granted not every note they have is a 25,000 dinar note...but if you do the math, with 50 dinar notes you only get 540,000,000 or about 18 dinars per person....They need to RV along with the pulling notes out of circulation...otherwise everyone only has about .02cents in wealth...there just wouldn't be enough to go around

Thats why, while a RD stinks, it works...you RV as well as reduce the currency in circulation.....with a RD you still have that 27 billion dinars or 18 dinars per person...but they are now worth $15.48 its still WAY to low, but Iraq isn't quite America

Very good points that you have. I think that Andy and I would agree that the RV is very necessary, hence the original point that Andy made to start the topic.

Your assumption of denominations may be dead on track, one possible solution to that are the new lower denominations (including the coins) being "ready" or being "ordered", whichever is actually the case.

I also recently read the following in one of 20Million's posts:

"Exactly! I believe that they have been letting them cycle through the system so to say. BUT, now that the government is moving to 100% e-government via Smart Cards they can now keep them and remove them from circulation if they choose to do so.

They will not need to put them back in the system after bringing them in via the Currency Auctions now that they are using Smart Cards for ALL government payments.

90% of GDP is OIL (Government)

90% of Cash can be removed now that 90% of all business and payments can be made via Smart Cards"

Assuming that 20Million's assumption above is accurate, we can then start to hypothesize that maybe, just maybe, they do not need as much cash "on the street" as we once thought.

Nobody really knows, appreciate your thoughts on it!

GO RV!!!

[tampabay6]

I agree 100% with the gist of the main points made on this thread; indeed I mentioned a few of these ideas in several posts that I wrote a week or two ago, but Andy has gone more into detail than I did... Kudos to you!

My only question regards the last sentence of the following quote:

...the Iraqi money supply is grossly inflated. Numbers range from 20-27 trillion in circulation. RV'ing that amount of currency at even 1:1 would make Iraq's money supply worth 20-27 trillion dollars. This is more than the USA has out on the street.

I will quote from today's (September 16, 2011) World Affairs Brief - in my opinion one of the best sources anywhere for news analysis, and which I recommend without reservation. It is not free, but you can request a one-time free sample of the briefs by sending an email to editor@worldaffairsbrief.com. If you do that before next Friday, you should probably get the brief I am quoting from.

---

"... people grossly underestimate how much money creation the Fed and the European Central Bank (ECB) can get away with and still not cause hyperinflation. Eventually it will, but they can keep this up for almost another decade if they don't exceed 5-10% of the international supply of dollars and Euros.

As for the dangers of hyperinflation in all this, I'm amazed at how few analysts have even looked at the one key factor that determines hyperinflation--the size of the monetary base compared to the money created each year by government. The larger the base, the more the FED can inflate without it showing up as high inflation. With minimal estimates of $200T for outstanding US dollars in print worldwide (and that doesn't include the almost $500T estimated in non-monetized paper contracts, hedges and other ponzi-style derivative schemes out there), the FED can and does create over $2T a year and that's only 1% of the money supply--hardly enough to produce hyperinflation.

I don't approve of it, but the manipulators know they've got a lot more room for money creation. In truth, counting secret bailouts around the world, the US is probably creating at least $10T a year in new credits and handing them out to insider banks around the world. The one-time accounting we had (thanks to Ron Paul's Audit the Fed bill, despite its being gutted) showed that the FED did indeed create over $10T in loans, and hand it out to its member banks, here and abroad."

--- end WAB quote ---

If we don't believe the money supply figures coming out of Iraq, why believe the ones coming out of the U.S. ?

There are many countries where "dollarization" is happening, not just Iraq. The drug trade is a big part of this, although there are other factors. It is to the advantage of the Fed to spread a large part of the USD supply all over the world - if the dollars all came back here, no one knows how bad the resulting inflation would be raging!

Several articles have mentioned that the IQD that we cash in will be sent to the FED in exchange for the USD that we receive, and later the FED will dispense them back to Iraq over a longer time frame for the purchase of oil, so that Iraq will not have to come up with USD, Gold, or other hard assets immediately at RV time to exchange for all the IQD that will be cashed in.

Several posts here have explored in detail how, for every dollar of profit that goes to those of us who hold IQD, there are multiple layers of profit for the banks and governments involved. I will not repeat all that here; it's not hard to find. My only point is that the establishment will have NO problem whatsoever, paying USD to those of us who want to cash in dinar, whether the RV rate is $0.86, $1.17, $3.22, $3.86, or even more than that. I assure you, the Rothschilds are not in the slightest concerned about it.

So, those who believe that there cannot be an RV because "Iraq cannot afford it" - need to find something else to hang their belief on, because that dog won't hunt - not that it ever did.

[gatoraces]

so the CBI in essence is doing what we did. buying dinar at 1170 per dollar with the lovely side effect of having less out there in circulation. if (as some have stated) 75% or more of dinar is back at the CBI, that leaves 8 trillion 'out there'. is there an amount of dinar in circulation they are trying to get to before they RV?

[andy3978]

so the CBI in essence is doing what we did. buying dinar at 1170 per dollar with the lovely side effect of having less out there in circulation. if (as some have stated) 75% or more of dinar is back at the CBI, that leaves 8 trillion 'out there'. is there an amount of dinar in circulation they are trying to get to before they RV?

I would suspect that Dr. Shabibi has a number in mind of Dinar on the street that would be acceptable for him to commence the RV. Anyone else can speculate on it but only HE would know.

I suppose the long and short of my theory is that the auctions are Re-Denominating the currency for us. Bypassing a traditional LOP. IMO this is good news for us. If this theory is correct (which it may or may not be) then seeing large daily auctions is actually a good thing for us to see.

Again I will state, this is only a theory and may be totally and completely off base. It's just another way to look at the situation.

What do you think KeepM...does anything I suggested make any sense?