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Happy anniversary 1170.
Yes… one year ago today it hit 1170.
Funny... cause it was the big 1 dinar note pump that was the last straw for Strong.
Punto... that's directed as much at you as it is at the dinar boards in general.
I find it amazing that some will believe every word posted by known dinar pumpers who are also known liars... then turn around and try their darndest to rip apart a legit thing like this.
These are the same people that stated this 2 years ago.
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=29372522
"However, currency appreciation remains the CBI's principal anti-inflationary policy instrument and we therefore expect the dinar to appreciate around 2% over the rest of this year to hit IQD 1,180/US$ by end-08 and around 7% in 2009 to hit IQD 1,100/US$ by the end of the year."
So yeah... let's keep ripping them and hanging on the words of those that have been guaranteeing a 100,000% rv for years now.
LOL... Great site. I went over there and posted for about a week before they banned me.
They had a lop thread going and of course most claimed it could never happen. So I made a post with about 20 links to past lop articles. I guess that was more than they could take.
It's just another site where it's fine for people to make up blatant lies to get people excited over and over and over. Even when proven a liar, it's fine that they make up more and more lies.
But... if you go there and simply post facts... facts they don't like... you'll be banned.
Iraq Business Forecast Report Q1 2010
http://www.officialwire.com/main.php?action=posted_news&rid=54248&catid=972
We do still forecast fiscal shortfalls out to 2014, but they should be manageable. Supported by healthy current account surpluses, we expect the central bank to hold the dinar steady at around IQD1,170/US$ over the next five years.
So you are one of the "INTEL" crew. One that they close down the chats, give you floor, and allow you to share your "INTEL" from your "sources"... all while no one is allowed to question you guys. Nice gig you got there.
I know you use to post as SecretKey and Ranger on the boards.
What names are you currently using to “inform” people?
Have you and Ali found that one dinar note that you promised as a fact 2 years ago?
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=28553589
again... nothing to back up your fantasy numbers. Bring a link and we can discuss it. To suggest the GDP has dropped over 60% makes you look silly.
His numbers are from a dream.
Even if the dollar drops 50%... which we better all hope doesn't happen.
Even if it drops 50%... Iraq backs the dinar with foriegn currency reserves which are probably 95% dollars. So if the dollar tanks, Iraq's currency reserves tank. Not good for the US or Iraq.
Lets put Iraq’s oil into perspective.
Iraq is struggling to get oil production up over 3 or so million barrels a day as of now. They are hoping to get to 6 or 7 million in the next 6 to 7 years. Let’s use the highest estimates… lets say they get to 10 million barrels a day. They’re a long ways from that.
(Do you realize America produces about 7 million barrels a day now.)
Back to Iraq… 10 million barrels a day X 365 days = 3.65 Billion barrels a year.
We’ll even up the rate per barrel to $100 a barrel. That’s $365 Billion a year.
That is wonderful for Iraq. But here’s the perspective. The United States GDP is about $13 Trillion a year. That is 35 times more than the potential Iraq may reach. If Iraq can get to 10 million barrels a day, and sell it for $100 a barrel, it would still take them 35 years just to equal one year of Americas GDP. That and they have 20 times more currency in circulation and about 3 times more M2 than America…. Well… do the math.
Iran is the #3 country in oil reserves… and Iran has been discussing lopping zeros from their currency. Venezuela, which is #7 lopped 3 zeros in 2008. Russia, which is #8 has already lopped zeros. Nigeria which is #9 is talking about lopping zeros.
Oil in the ground will have nothing to do with a lop. A lop is simply to reverse the effects of inflation. It's an absolute fact that Iraq suffered from massive inflation during the late 80's and 90's. That is what destroyed the value of the currency.
There is no amount of oil in the ground that can undo that.
I really don’t like giving direct advice. I can only present facts and ad my opinion and let others make up their own minds.
My opinion is the dinar will never do better than 1000:1
My opinion is they will issue a new currency and exchange 1 new for 1000 old.
My opinion is people holding cash dinar will get raked over the coals by the dinar dealers… they will probably be the only ones willing to buy it back after a lop is announced… and they will only do it if there is plenty of time for them to get it back into Iraq for exchange, so you might get stuck with junk paper.
Just a guess… but I think this will happen very soon after we leave Iraq. I think that’s what they are waiting for.
Happens all the time. A 3 zero lop will reduce currency by 99.9%
More than 70 countries have done exactly that since about 1960.
Time to repost this...
http://www.unc.edu/~lmosley/APSA%202005.pdf
Dropping Zeros, Gaining Credibility?
Currency Redenomination in Developing Nations
I don't feel stupid that I bought and held dinar for a while.
I was uninformed about currencies at the time. I feel a little foolish that i recommended dinar to a few people before I became informed... but I'm actually much more knowledgeable now because of my experience. It's how we learn.
Almost all countries have a Central Bank (or something similar), and all those Central Banks have a web site where they list financial information including Money Supply. That info is also supplied to and verified by the IMF.
Here are Iraq’s Financials… you need windows Excel to open it.
http://www.cbi.iq/xl&wr/key%20financial.xls
Iraq’s money supply is line 73. M2… which stands at 42.9 Trillion as of last report.
Line 72 is M1… that is currency in circulation plus some bank accounts. Now 35 Trillion.
Line 65 is their currency in circulation number. They call it Currency Outside of Banks. Currently at 21 Trillion.
I also talked about the currency in circulation number here.
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=44662531
I don’t think it will any time soon, if ever. No middle east countries are free floating on the FX. The future GCC currency that is planned for the region will not be a free floating FX currency. It will start as a fixed currency and they say it may free float sometime in the future.
This talks about free floating currencies.
http://www.foreignexchangecenter.com/free-floating-currencies.html
1. “In other words, the currency may be traded by anybody and its value is a function of the current supply and demand forces in the market,”
2. “When a currency operates under a free floating exchange rate, its volatility rises. This is especially dangerous for emerging economies”
My take on number 1. As I’ve stated before. Currency gets it’s value from Supply and Demand. Iraq has a MASSIVE supply and practically no demand. That’s why their currency is 1000:1. If they were to go on the FX the value would be 1000:1. It's also funny that none of the so-called internet Dinar experts ever even mention supply. It's half of the equation for value, and they ignore it. In fact... on many dinar sites you will get banned for talking about supply.
Number 2. It states a free floating currency would be dangerous for an emerging economy. Iraq certainly is an emerging economy… an will be an emerging economy for many many years… and that’s if things go well.
Chapter VII is basically a UN classifivation that Iraq was put under because they were deemed a threat to peace.
What it allows is this... when the UN wants to impose sanctions on a country they have a complicated process and vote. Once a country is under chapter VII they no longer have to go through that prcocess. Chapter VII is kinda big catch all... and allows sanctions to be imposed quickly and with all the process and votes.
Practically all sanctions have already been lifted from Iraq. The only sanction remaining is one that forbids them from dealing in arms. The other effect is that The Development Fund for Iraq is under international control at this point. Once VII is lifted, the Development Fund will be under the control of Iraq.
Here’s another link for you.
Bit of a compromise.
http://www.globalsecurity.org/military/library/report/crs/crs_iraq_economy.pdf
“the gross domestic product peaked at $53.9 billion in 1980 because of the oil boom, and fell by about one-half to $26.9 billion in 1989. GDP reached its low point in 1994 falling to $6.5 billion under the weight of economic sanctions.”
So in 1980… last time they really had that 3:1 rate everyone talked about. I’ll take the low figure of the TWO links I’ve provided… $54 Billion.
So they have increased M2 140,000%
And they have increased GDP about 90%
Still not quit “inline”
The $6 billion number you quote was in 1994… the dinar had already taken a beating by then.
http://www.globalsecurity.org/wmd/library/report/2004/isg-final-report/isg-final-report_vol1_rfp-anx-d.htm
Exchange rates are important during these transactions because they represent the linkage between one country and its partners in the global economy. Exchange rates affect the relative price of goods being traded (exports and imports), the valuation of assets, and the yield on those assets. The CBI pegged its official rate between $3 to 3.38 per dinar in the 1970s. The last official exchange rate of $3.11 per dinar was set in 1982. During the 1970s the official and market rates generally corresponded and by 1980 the country had $35 billion in foreign exchange reserves. Because of the war with Iran that figure had fallen to $2 billion by 1987. The currency depreciated rapidly in the unofficial market during the Iraq-Iran war and after the first Gulf War the pace of depreciation increased further. During 1997 to 2003, the exchange rate fluctuated between 1500 -2000ID per $1 and was fairly steady at about 1950 ID to $1 in recent years. Although the Regime did not alter the official exchange rate after 1983, it acknowledged the rate differential in 1999 by allowing state run banks to exchange hard currency at the rate of 2000 ID to $1
I never accused you of writing it. I simply pointed out where it came from and that it was done by a dinar dealer.
Do you think people should not know that info?
You might want to check your facts.
http://www.infoprod.co.il/article/28
"When Sadaam Hussein came to power in 1980, however, GDP stood at almost $130 billion and Iraq profited from one of the most advanced economies in the Middle East."
LOL... And I'm spinning?
So the facts still are a 140,000% increase in M2
and about a 25% DECREASE in GDP.
Not really inline as you claim.
Pretty easy to find
http://blackhillsportal.com/npps/story.cfm?id=3569
"Submit your news and request front page attention. We will put you and your story out in front of the World!"
Anyone can write anything and have it posted as "news" on this site.
I love how they can write this entire article and never mention that Iraq had 30 billion dinars M2 when they had that good rate, and they now have over 43 trilion M2. Seems like a pretty important piece of the equation.
That's 1,400 times more currency to support.
Every one for those arguments has been put out there by dinar pumpers.
This James A Smith... Senior Financial Officer seems to be kind of a light weight if he has to plagiarize all of his information from a guy like Medic.
LOL... also... the dinar dealer ad link at the bottom of the "story" doesn't help.
Well… not sure where you get the 1 cent from. From my post ½ a cent looked more like the tops.
Here’s the problem though… as Iraq’s economy, GDP increases, and as they add foreign currency reserves, they can increase their money supply. Almost surely they will do that mostly by increasing circulation and M2 amounts with some small increases in exchange rate.
Look at the past years
End of 2004, M2 was 12.2 T
End of 2005, 14.6 T
End of 2006, 21 T
End of 2007 27 T
End of 2008 35 T
End of 2009 (as of Sept) 43 T
So… and of 2004. M2 12.2 Trillion, exchange rate of 1460.
So their money supply was $8 Billion at the end of 2004.
Currently… 43Trillion x 1170 exchange rate.
They now have a money supply of $36 Trillion.
So since 2004 they have had a 450% increase in money supply.
During that time the exchange rate went up 25%.
Yep... I posted this a year and a half ago.
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=29552168
While our numbers may be a little off here or there, depending on whether we used… m1, m2, or m3 and what the GDP was at the time… it still paints the same picture.
I compared money supply(converted to $s) to GDP.
(high value currencies)
Kuwait has a money supply that is 106% of it's GDP
Malta is 125%
Bahrain 64%
Oman 154%
UK 36%
Latvia 30%
Jordan 68%
USA 55%
(low valued currencies)
Korea 163%
Mongolia 17%
Tanzania 8%
Columbia 16%
Belarus 10%
Venezuela 41%
Indonesia 15%
Iran 17%
Vietnam 20%
Saudi Arabia is 41%
Iraq is currently about 20%... which is pretty much right in line with all these other countries.
If they were to revalue to 1:1 their money supply to GDP ratio would be 21600%. That would put them slightly out of line with the rest of the world.
Even 30 cents per dinar would leave them with a ratio of about 8700%... still a bit out of whack.
If they went to 200%, which is still higher than any other country on the list. The rate would still be less than a penny... about .7 cents per dinar or .007
A 100% ratio would be about .3 cents per dinar or .003
The CBI explains the "currency outside banks" figure.
Line 65 of this document... 20.978 Trillion
http://www.cbi.iq/xl&wr/key%20financial.xls
This is how it is explained
http://www.cbi.iq/pdf/Key%20Financial%20Indicators%20Documentation.pdf
a - Currency outside banks, i.e., the currency component of the money supply as shown in the Analytical Balance sheet (Item 8) which is derived from the following sources (currency put into circulation reported by Issuing Dept. less vault cash(item 8.1 of Analytical Balance Sheet) reported by Research & Statistics Dept.). From December 2003, currency in circulation is the new currency issued by the CBI less redemption of old and damaged new currency notes.
They clearly state that this is their currency in circulation number... and they clearly state that this number takes into account any REDEEMED old and damaged currency.
Redeem means to buy something back… so as currency is bought back (for whatever reason) it is taken into account in the figure.
So if they issue 100 dinars… and two get redeemed because they are damaged and ten get redeemed in currency auctions then their currency in circulation number would be 88.
In other words… the number they report takes everything into account, you don’t have to guess how much is removed because of damage or auctions.
Now… if I have some dinar stashed in my house, and my house burns down, then the CBI has no way of accounting for that type of stuff. But I’d say that’s a pretty insignificant amount.
In 6 years they HOPE
Why didn't you post the link for this?
Where did you get it?
Here it is...
http://www.mediafire.com/?5qmjoz5gbw4
It's a bogus site... nothing to do with the Iraqi Government. Not even a legit news site.
It has a picture of their old flag at the top.
It was written in english and the arabic text is translated from the english... LOL
This was written by a dinar dealer or pumper.
Great DD.
Hmmm… how do you explain why something doesn’t exist?
The US has about $1 Trillion in circulation.
I don’t think people understand just how much a Trillion is, it’s a huge number.
Think about this… 1 Trillion dollars is enough for all Americans to have the money we carry… plus the dollar is the currency of choice in many smaller countries around the world.
That’s why the fact that Iraq has 21 trillion dinars for their tiny country and economy is a staggering amount and explains why it is pretty worthless.
The US printed a small number of large bills… $5000 and $10,000 long ago for bank transfers.
Iraq has printed up stacks upon stacks upon stacks of 25,000 dinar notes and sold them to people all over the world.
There are many on dinar boards that believe that Joey.
For years people claimed the US bought $7 Trillion dinar… even though there was never any such mention of it other than by dinar pumpers and their sheep. They claimed Bush did it so that he could pay off the debt and that would add to his legacy.
Pretty funny when you consider Iraq had a total of $300 Billion in debt when/after we invaded. That debt was labeled as crippling to Iraq. They had no chance of recovery with that much debt. They have worked for years to get the debt forgiven… down to a manageable amount.
So while that was all going on… we were to believe that Iraq was going to RV and give the United States $7 Trillion. That’s about 23 times their original CRUSHING debt.
Here a thread on another board talking about it.
http://www.investorsiraq.com/showthread.php?t=131727
You can see the confusion.
Seems they did… now they don’t… some say they never did.
I wouldn’t trust any of it… I’d call the bank personally.
Just reading that thread… LOL… gotta love the guy on page two claiming he made money on the Kuwait thing.
They don’t allow people with enough sense to question such an absurd statement to post over there.
I notice you didn’t answer the question. You screamed I’m wrong all the time. What am I wrong about? I didn’t just cut and paste figures. I explained that it’s silly to think Iraq will have a money supply 5 to 30 times larger than the rest of world combined, like the dealers and pumpers claim, while they have .16% of the worlds GDP.
I would like you to back your claim that I’m wrong all the time, and explain why I’m wrong in this one simple instance.
Maybe it is you that is a bit irresponsible to come onto a board and attack a poster without one single fact to back up your claim.
Are you sure you want to go down this road with me? I see you have a lot of followers. But this isn’t a penny stock you’re dealing with here. I know the dealers and pumpers like to treat it like a pinkie… just make up anything they’d like and expect the masses to buy it. Doesn’t work like that with a currency. The FACTS are out there for anyone to see. My posts contain the facts… with links. The Central Bank of Iraq publishes financials. Practically every central bank publishes financials for camparison. The IMF verifies those numbers and publishes them also.
Money supply numbers are available for almost all countries.
GDP figures are available for almost all countries.
World money supply numbers and world GDP numbers are published.
You come over here and jump down my throat screaming that I’m always wrong. Please explain for the others here where I’m wrong. Show us some of your DD.
Here are just a couple of my recent post with easily verifiable figures. Explain how my thinking is wrong.
The worlds GDP is about $60 Trillion.
The high side of the Iraq GDP estimates are about $100 billion.
So Iraq's percentage of word GDP is .166%
That’s not 1 percent… that is one and a half tenths of one percent.
Please explain how a country with that tiny fraction of the worlds economy is going to have 3, 4, or 5 times more currency than the rest of the world combined. And that’s the low end of the estimates. If you believe the 3.50 rumors, they would have 15 times more currency than the rest of the world combined.
So… from $1.50 to $3.50
http://www.cbi.iq/xl&wr/key%20financial.xls
Line 65… Iraq has “Currency
outside of banks” (That’s M0) 21 Trillion
Look at line 72… Iraq has an M1 of 32 Trillion.
So $1.50 would give them a M0=$31.1 Trillion and M1=$48 Trillion
$3.50 would give Iraq a M0=$73.5 Trillion and M1=$112 Trillion
http://dollardaze.org/blog/?page_id=00023
The whole world combined as of now.
M0 $5 Trillion
M1 $20 Trillion
It’s funny you call people dumb for selling based on a post on this board. Even though those post contain links to FACTUAL information.
Yet… when most, including myself, bought dinar… we/I bought based on post on the internet with absolutely no factual information.
Some people have the intelligence to see the errors of their way… others don’t.
Joe... I think they use to deal in dinar but have since stopped. I bought mine from an internet dealer and sold them on e-bay... so I've never dealt with a bank, so I'm really not sure. You might want to give them a call... and if they say they still buy it, ask them if they will still buy it if Iraq announces a new currency and lop. I doubt they will have an answer for that last question.
I’m not sure what you mean… “did the lop work for them”?
Korea just lopped last week.
Venezuela lopped Jan 2008.
Did it work?? Let’s start from the beginning. A country starts with a reasonable amount of money to support their economy. They have bills like a 1, 5, 10, 20 and a 100. They adopt poor financial policies and inflation starts to rage. Instead of changing policies, a lot of countries answer by flooding the market with more money, which fuels higher inflation, which they answer by printing more, until they have to print 1000, 5000, 10000, 25000 unit bills to try and keep up… and they end up with money supply numbers in the TRILLIONS.
A lop serves one function… it is to return the money supply to a reasonable number, Billions… and allow them to print smaller denominations again.
So in that respect… yes… every lop works. It reduces money supply to a reasonable level.
That doesn’t guarantee that inflation wont destroy the new lopped currency also. That’s why countries try to wait until inflation is under control before lopping.
LOL… thanks. I was ignoring him, but now that you point it out… he’s right that neither I nor anyone else knows exactly what will happen. I’ve never claimed to know what will happen. I’ve simply pointed out that the Central Bank of Iraq and the Minister of Finance of Iraq have stated a number of times they plan on issuing a new currency and lopping 3 zeros. It’s a fact 30 some countries have done the same thing in recent years. It’s also a fact the financial numbers presented by the CBI and the IMF support a lop. So It’s my opinion… along with the reported statements of the CBI and MOF that Iraq will lop.
But he is right… I may be wrong. They may never lop. But if they don’t their exchange rate will stay basically the same… Exactly like other countries that didn’t lop after being ravaged by inflation. Italy, Korea, Vietnam, Iran, Lebanon, Columbia, Indonesia, Venezuela… just to name a few. Many countries are just fine having an exchange rate in the thousands. They all have one thing in common with Iraq… money supplies in the TRILLIONS.
So I don’t know exactly what WILL happen… but I know 100%, for sure, without a doubt what WILL NOT happen… and that’s a large RV.
Good time to bring these back up…
Highest and lowest value currencies… a couple years old, but still relevant today.
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=22546254
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=22546210
Not sure what oil has to do with the dinar, because oil is sold for dollars… but lets put Iraq’s oil into perspective.
Iraq is struggling to get oil production up over 3 or so million barrels a day as of now. They are hoping to get to 6 or 7 million in the next 6 to 7 years. Let’s use the highest estimates… lets say they get to 10 million barrels a day. They’re a long ways from that.
(Do you realize America produces about 7 million barrels a day now.)
Back to Iraq… 10 million barrels a day X 365 days = 3.65 Billion barrels a year.
We’ll even up the rate per barrel to $100 a barrel. That’s $365 Billion a year.
That is wonderful for Iraq. But here’s the perspective. The United States GDP is about $13 Trillion a year. That is 35 times more than the potential Iraq may reach. If Iraq can get to 10 million barrels a day, and sell it for $100 a barrel, it would still take them 35 years just to equal one year of Americas GDP. That and they have 20 times more currency in circulation and about 3 times more M2 than America…. Well… do the math.
Joe… I think most banks that sell/buy dinar have already stopped dealing in them.
The ones that might be left… it would probably depend on the exchange time allowed if they lop. If it’s a short exchange time, no bank will take the chance of being stuck with worthless dinar. If it’s a longer exchange period and they feel comfortable that they can get the dinar back to Iraq and exchange it then they may buy it back.
The article about a bank in Iraq hooking up to currency markets… is just that. This is the first COMMERCIAL bank in Iraq to link up to the system. This will allow companies and citizens of Iraq to open accounts at this bank and trade the FX. Remember… the FX is not just an investment platform. The FX was established to allow countries and businesses the ability to buy and sell currencies needed to do business with each other internationally.
It doesn’t mean the Dinar will be floated on the FX.