Friday, October 28, 2011

More Drama at DV

On Wednesday Adam Montana sent out a mass email offering his thoughts on the "upcoming" RV.  Many of you no doubt received this email, but for the benefit of those who didn't I'll sum it up.  Adam thinks the rate will come out at around a dime and then gradually climb up over the next few years toward its former value.  I have no problem with this opinion.  As gurus go Adam's views are as good as any I suppose, even though my opinion is that even a dime isn't doable at this time.  But that's not really the point I want to address today.

In his email he stated the following:

"An instantaneous RV to $3.00 will create a ton of wealth – coincidentally, probably about the same amount of wealth that they lost when Saddam Hussein was taken out of power and the value of the Iraqi Dinar plummeted to mere pennies! What’s done is done, though, and we have to look at the situation for what it is today – not what it could have been or should have been."

Well this prompted one of his members by the name of xyzzy to respond as follows:

In Adam's blog (that we all get mail about) he says this (bold added by me)

"An instantaneous RV to $3.00 will create a ton of wealth – coincidentally, probably about the same amount of wealth that they lost when Saddam Hussein was taken out of power and the value of the Iraqi Dinar plummeted to mere pennies! What’s done is done, though, and we have to look at the situation for what it is today – not what it could have been or should have been."

This may be among the most common explanations used for why the dinar could be revalued back up. Namely that it was devalued suddenly down when Saddam was thrown out. The problem is that this is simply false. Go research at the CBI's history page and they say in 1995 (8 years BEFORE the Iraq war) the dinar had fallen to 3000 dinars per dollar (far less than mere pennies) due to massive printing of the currency over a period of years. Go look on currency history sites like and you might not see exactly the same pattern, but one pretty close. Every resource I know of confirms this.

Adam is clearly a smart guy and is very knowledgeable about the dinar so it is very hard for me to imagine he actually does not know the correct history here. So why push this clearly false info?

He didn't call Adam a name. Didn't accuse him of doing anything illegal. Didn't really insult him. He just said that Adam was posting information that was wrong and he should know that it's wrong. Adam's response?

So xyzzy is stating that the Iraqi Dinar was never in the $3 range. He uses that statement to accuse me of lying.  I can let the first part go - you're all welcome to your opinion, regardless of how right or wrong it is.

The second part, on the other hand - I don't have any desire to let that continue.    Member xyzzy banned, thread closed.
xyzzy was banned and the thread was closed. In other words, rather than discuss the message Adam shot the messenger.  As anybody can clearly see Adam completely misrepresented what xyzzy said.  He never mentioned the $3 rate and never really called Adam a liar.  But he did call Adam on his misstatement of facts and revealed Adam's ignorance, and that couldn't be tolerated.  Thus the ban.

I know the feeling, XYZZY.  Adam banned me last week after I asked him to tell us about his experience of investing in the Kuwaiti dinar 20 years ago.  This is typical behavior from guru dinar site owners.  SteveI does the same thing at People's Dinar. Likewise with Dan Atkinson at People's Talk Radio, Blaino at Planet Dinar, and Med at Dinar Speculator. You call them on their BS and you're gone.

On the other hand you'll find many dinar sites where the site owner isn't driven by the bottom line and members are free to discuss dinar issues and engage in respectful debate without fear of banishment. You see, it's all about the money. If the owner is driven by the pursuit of profits then they can't tolerate free thought and critical thinking. They have to maintain control, and the ban is their control mechanism.

xyzzy brought up a very legitimate issue. Adam's version of the history of the dinar is simply wrong. It didn't plummet to pennies when Saddam was thrown out. It devalued to less than a penny over the years while Saddam was in power and printing money like crazy.

So why would Adam make such a statement? I think the answer is simple, xyzzy. Your assumption that Adam is very knowledgeable about the dinar and knows the correct history is wrong. IMO Adam doesn't know jack. He knows just enough to put on a dog and pony show that takes suckers for hundreds of thousands of dollars a year.  Hopefully now more of his sheep will recognize that fact and move on to safer pastures before they get sheared.

I would like to issue these challenges to Adam Montana.  Please offer some evidence to support your claim of capitalizing on the Kuwaiti dinar's devaluation.  Please offer evidence of your claim to be a Harvard graduate.  Please offer your members evidence of your claim to be a certified investment adviser who passed the Series 65 test.  I realize of course that it would be hard to accomplish any of these without revealing your true identity, but if people are going to trust you in the future they need to know that you have been honest with them in the past.

And to the members of Adam's site Dinar Vets I would like to say, until Adam Montana offers such evidence please proceed with extreme caution.  As we have proven on this blog the dinar world is full of con artists and scammers.  Remember that before you part with your hard earned money.


  1. Dimes? Pennies? Could you then explain the table of historical IQD exchange rates as posted by the IMF?

  2. That's a chart of SDR's which are not the same as currency. Comparing the most recent entry from April to the CBI rate you can see they're not the same thing.

  3. The "Special Drawing Right" or SDR, is the globally recognized currency of the International Monetary Fund. As such, it functions as the "lowest common denominator" when calculating the proper exchange rates of differing currencies between global trading partners. Any payments made TO, loans FROM, or exchanges THROUGH the IMF will be expressed in value terms of SDRs ... therefore a SDR most certainly functions as a currency in the international trading community. The national economy of its member countries is reviewed by the IMF on an annual basis, with the subsequent posting of that currency's determined exchange rate in terms of SDRs. Iraq's annual review typically happens on or about 30 April of each year, with extremely few exceptions in the past 25 years. As of 30 April 1995, the IQD was determined to have an international exchange rate of SDR2.04504. On 1 May 1995 the SDR was valued at $1.57050, which leads to an exchange rate of IQD1 to $3.21 ... admittedly the lowest exchange rate on record for the period 1985 to 2004. In 2004, the Coalition Provisional Authority (the provisional government of Iraq) arbitrarily and forcibly DE-valued the IQD. Historical data from Oanda through the link posted above, shows a constant "bid" price of $1.6667 for the period of May 1995. Using the figures supplied by the IMF, it's apparent that since 1985, the IQD was ALWAYS exchanged at a rate of $3 PLUS ... at least as pertains to international trade ... until Operation Desert Storm and the advent of the CPA in 2004. As to the purported CBI historical exchange rate of "3000 to 1" it's important to keep in mind that a bank, even a CENTRAL bank, offers only those exchange rates to its customers that it wishes to. Many banks around the world are not as regulated as we in the United States. Using data from 1995 (the middle of Saddam Hussein's reign) might be suspect because of the sheer totalianism of his rule. It's entirely possible (even probable) that he mandated the internal exchange rate for the IQD while reaping vast profit by then exchanging that recovered IQD via international trade at the rate of $3.21.


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