Iraqi Dinar Discussion Board

[Rasica]

LOL nice try :O) But you keep ignoring the 'Tight Monetary Policy' I am glad however that you gave up your 55 years for my 18 months at the most.

This is why when you read about the Iraqi economists informing continually that the IQD is way undervalued and the IQD value they are using at the CBI is artificial.

This is why, when I keep explaining that the IQD is 'IN HOUSE PRICING ONLY' is because of the 'Tight Monetary Policy' to keep the economy from OVERHEATING as what happened to East Germany after WWII.

This is why also, The head of the CBI stated the BUY BAck is now being used as the LEVER to control Consumer Pricing. THIS IS ALL IN HOUSE!

They are causing a REAL preemptive financial osmosis (if you will), before the IQD is tied to the GNP/GDP. They are doing financial brain surgery in other words... this is why the IMF is giving it another go to relinquish the SBA in March and why the WTO will 'probably' go thru with accepting 'Iraq' in March.

They cannot release all this value into the infrastructure right now .... because they want this revenue to primarily stay within the borders of Iraq.

This is also why, when the tying into the GDP instantaneously, they will do it in such a way as to discourage (Corporate Investors/Big Money). At what level will the first reval take place? The IMF/Iraq/CBI will decide prior to and by the projections FROM the Tight Monetary Policy. With the release of the SBA in March and the WTO acclimating Iraq, I see this as the beginning point of serious thought to the GNP/GDP. I think the first valuation will be quit small, as to still keep the Corporate Investors ( ones who would certainly egress money out of Iraq) from buying in.

I think the process will be from miniscule revals to a substantial larger one to discourage the Corporate Investor scenario.


The Iraqi central bank is buying back its currency at a feverish pace, forcing the value of the Iraqi dinar higher.................

http://www.nytimes.com/2008/06/21/world/middleeast/21security.html?hp<br>
By STEPHEN FARRELL and RICHARD A. OPPEL Jr.
Published: June 21, 2008
Page 3

........and limiting increases in consumer prices. Driven by higher food costs, inflation stood last month at the high rate of 16 percent, up from 11 percent in January.

That rate might be a good deal higher without the central bank’s aggressive policies. The bank spends $1 billion to $1.5 billion every month in oil revenue to buy Iraqi dinars on the open market, said Mudher M. Salih Kasim, senior adviser to the bank. This is the main lever for controlling consumer prices, said Kasim, who noted that the value of the dinar had risen about 20 percent against the dollar. An oil price crash, he added, would be “a disaster.”

The government is also trying to funnel money to placate Iraqis who endured the military operations in Sadr City, Mosul and Basra and cement their loyalty. Tahseen al-Sheikhly, a spokesman for the Baghdad security plan, said $100 million will go to Sadr City to upgrade economic and social conditions there in the wake of the two-month military operation, which left buildings shattered and markets destroyed. Dr. Safaa al-Deen al-Safi, who is charged with implementing development and reconstruction activities, said another $100 million will be spent on areas like health and education.