Replies to post #15807 on Iraqi Dinar Discussion Board (IQD)

[Aerospace]

Did you even read what you posted. This not a positive article.
The guy is talking about how stable the dinar is where it is. Do you think it would be stable if they increase the value %120,000?
Did you read this part?
What trips up most people (and in terms of Iraq there is a beautiful representation of that if one goes to the Dinar ‘Investing’ sites, such as my financially illiterate ‘friends’ here) is the misplaced belief that a form or money or another has some intrinsic value, and if the government prints more money (in the broad sense of increasing money) supply that will increase the wealth of the citizens (if one searches the cited site, and reads through discussions particularly in the August 2005 period, one finds many instances of ‘Iraqis are poor, so the government should revalue the Dinar up to make them rich’ argument, a variation on this error). It doesn't by the way, as the long history of currency manipulation amply demonstrates - prices adjust to the new base and one ends up with the same overall wealth (although parenthentically I may add too little money and too much both impose penalties). See this quick definition of Money Illusion from Wikipedia, which is useful enough.

I like this guy.

[Aerospace]

I really love this guy... great article Rasica.

From the article...
The first question has already been answered in the positive, in the short term, as the history of the exhcange rate since CBI set it in 2004 has been pretty stable and CBI has not been massively pissing away reserves to defend it.
Understand... they have to defend the rate. A large revalue and they could not do that.

more good stuff
Regardless of the precise facts, CBI succeeded in setting, per all available evidence, an exchange rate that was reasonable with respect to economic fundamentals (see the IMF report),

more... he's great
Let me say, however, that I could not give a $% about "theory" - it's a meaningless statement and actually factually incorrect: early pressure in 2004 was towards currency appreciation not collapse (depreciation) as many (esp. Arabs) were speculating c. 2003-2004 on a Kuwaiti style revaluation back up to Sadaam levels (based I may add on a serious lack of understanding of that exchange rate).