Tuesday, July 16, 2013

Don't Listen to Gurus

Most dinar investors have trouble understanding this investment that they've put hundreds, thousands, or even tens of thousands of dollars into.  They're new to the world of currency speculation and are looking for somebody knowledgeable who can guide them through the process.  Well one of the rules for success in life is "find a need and fill it", so many dinarians have volunteered their services over the years and have taken on the role of intel providers, armchair economists, and researchers or "newshounds".  These people have become known as "gurus". 

The problems with gurus are numerous.  First of all there's the accountability factor.  Most gurus are anonymous and if Iraq ends up redenominating as they've stated they will the gurus can just disappear or move on to the next scam.  A real currency/investment expert will state their name and be sure to state the risks of any investment as well as the potential upside.  You'll never hear a true investment expert say things like "this is a winning lottery ticket" or "quit your job and pack your bags - this baby is done!"  If they're a true professional they'll plan on being around for many years and will take that into consideration with every investment they analyze.  If their track record is poor it could jeopardize their career, so they take every precaution to thoroughly examine each opportunity and assess the pros and cons.

Next is the lack of credentials.  Some gurus have degrees in other fields but none that I know of have degrees in economics or finance.  (A few of them say that they have traded on forex which I don't really get, because a forex trader would understand that the way you make money trading currencies is to make large leveraged purchases electronically with a spread of less than 1% and look for a profit of usually no more than 2% rather than paying a spread of up to 20% to buy paper currency and wait for it to RV 1000% or more.  But I digress.)  Rudy Coenen claimed that he was a VP at JP Morgan Chase, and that gained the confidence of many dinar investors for awhile, including me.  But he was indicted for fraud and that claim was one of the lies he was charged with and pled guilty to.  A true currency professional will be happy to provide you with their credentials to prove their qualifications.

And finally there's the simple grasp of facts.  A true professional won't be caught in constant misstatement of facts that are easily debunked.  Here are a few examples of what I'm talking about from the month of June. 

On Sunday June 9 Jester said:

"FIRST A LITTLE BACKGROUND ON CURRENCY TRADING AND MANIPULATION… THE TRADING OF CURRENCIES INVOLVES SHORT OR LONG TRADES AND SPECULATION ON WHETHER THE VALUE WILL GO UP OR DOWN ON EITHER AN OVERNIGHT OR WEEK TRADE… BECAUSE CURRENT CURRENCIES ARE NOT ALL BACKED BY A MANDATED FORMULA OR SYSTEM THEY CAN EASILY BE MARKET MANIPULATED BY ECONOMIC FORCES…
NOW THINK WHAT WOULD HAPPEN IF YOU KNOW THERE IS A GLOBAL RESET ON THE HORIZON… MANY CURRENCY TRADERS ARE SEEING THE REAL WORLD SIGNS THAT THIS IS HEADING OUR DIRECTION… TRADERS COULD MAKE MILLIONS OVER THE WEEKEND BY SHORT OR LONG TRADES ON SOME OF THESE SMALLER COUNTRIES THAT HAVE BEEN MOVING SIGNIFICANTLY THIS PAST WEEK… SO, A GLOBAL RESET WOULD PROVIDE A SERIOUS PROBLEM FOR THOSE WHO COULD AND WOULD MANIPULATE CURRENCIES FOR SELFISH GAINS…
SO THE QUESTION IS… HOW CAN THIS BE AVOIDED TO PREVENT MISUSE AS WELL AS VOLATILITY TO THE MARKETS?
SOME MORE BACKGROUND… WHEN A COUNTRY’S CURRENCY IS REVALUED A NEW CURRENCY SYMBOL IS CREATED… A GOOD EXAMPLE WOULD BE WHEN MEXICO REVALUED A FEW YEARS AGO… THEIR CURRENCY SYMBOL CHANGED FROM MXP TO MXN… THE N REPRESENTS THE NEW CURRENCY VALUE AND IS NO LONGER TRADED UNDER THE OLD SYMBOL…
THIS IS WHAT IS HAPPENING RIGHT NOW TO ALL THE WORLD’S CURRENCIES AS THEY ALL WILL HAVE NEW CODES… THIS WILL ELIMINATE SOME TRADER SHORTING A CURRENCY OVER THE WEEKEND AND PROFITING FROM SOMETHING SOME OF US CAN SEE HAPPENING…"

http://www.dinarrecaps.com/1/post/2013/06/jester-and-i4u-members-chat-saturday-afternoon.html


All you have to do to see through this tosh is conduct a few minutes of research on revaluations and redenominations. No new currency symbol is needed for revaluations.  The exchange rate is simply adjusted and it's over.  Think back to January 2012 when the rate in Iraq went from 1170 to 1166.  That was a revaluation.  The currency symbol of IQD didn't change.  All that changed was the rate.  No new currency was required either, because revaluations are just small adjustments that easily fit into the parameters of the existing currency.  Redenominations do require a new currency symbol however, as well as a new currency preceded by an educational campaign to prepare the people for the currency change.  What happened in Mexico was a redenomination.  They lopped three zeros off of their currency and issued 1 new peso for 1000 of the old.  Sound familiar?  That's what the CBI has stated that they intend to do with the dinar.  Jester is confusing the concepts of redenomination and revaluation.  Whether he's doing it intentionally or not I don't know, but what he said is flat out wrong.


On Thursday June 13 Breitling said:

"I know for a fact that the dinar is undervalued." 

http://www.youtube.com/watch?v=z9vw3uMrTu4  (21:44 in)


Really Tony?  How do you know this for a fact?  From your contacts at the IMF or the CBI?  Well I don't have any contacts at either one, but here's what the IMF has stated. 

The CBI [Central Bank of Iraq] will continue to aim at keeping inflation low, predominantly by maintaining a stable exchange rate. The low level and the relative stability of inflation do not suggest any significant over- or under-valuation of the Iraqi dinar. Also, a stable exchange rate continues to provide a solid anchor for the public’s expectations in an otherwise highly uncertain environment and in an economy with a very low level of financial intermediation.

http://www.imf.org/external/pubs/ft/scr/2011/cr1175.pdf


Stryker repeated this misconception a couple of weeks later when he said:

"I am using my educated guess and saying that Iraq has the most undervalued currency in the world and that they and we want the CBI to show us the real value and I believe they are close to do this."

Breitling, Stryker, and other gurus assume that the dinar and dong are undervalued because their value is so low in comparison to the US dollar, but all you have to do is look at the bloated money supplies (in the quadrillions for Vietnam) for both countries to see the reason behind those low valuations.


Recently I've been watching some of the nightly Stryker broadcasts just to see what insights he has on the dinar.  On Monday June 17 he said the following:

"We bought stock in their country.  Their stock happens to be their currency.  Just like ours.  Currency is perceived value of what a country is worth.  Stock's the same way." 

http://www.strykerblog.com/WebTV_Episodes.html (27 minutes in)

He repeated this misconception on June 24, referring to dinar investors as "stockholders" providing the funding for them to back their currency.  (24 minutes in)

I've stated several times in the past two years that one of the most common misconceptions dinar investors have is that currency is like stock.  It isn't.  If a company is growing and profits are increasing the stock's value will reflect that growth over time.  With currencies however, an economy can grow by leaps and bounds and yet the country's currency can (and often does) lose value against other currencies. 

In the following chart I've listed the 20 largest economies in the world.  Then I listed those same countries by currency valuation.  You'll see that there is no correlation.  Every country's currency is as unique as the nation it represents, and is valued according to a number of factors including money supply, GDP, political stability, their history of inflation .... etc.  Japan, for example has the third largest economy in the world, and yet the Japanese yen is valued slightly over a penny.  South Korea's economy is ranked 15th but their currency is valued about where Iraq's is at a tenth of a penny.  In the third column I've listed countries by GDP per capita.  You can see from this that Kuwait has the 6th largest GDP per capita even though their currency is worth nearly three times that of Luxembourg (the euro at $1.34) who has the highest GDP per capita.

GDP in trillions of dollars

1.     USA   $14.991
2.     China   $7.203
3.     Japan   $5.870
4.     Germany   $3.604
5.     France   $2.775
6.     Brazil   $2.476
7.     UK   $2.429
8.     Italy   $2.195
9.     India   $1.897
10.   Russia   $1.857
11.   Canada   $1.736
12.   Australia   $1.515
13.   Spain   $1.478
14.   Mexico   $1.155
15.   S. Korea   $1.116
16.   Indonesia   $.846
17.   Netherlands   $.836
18.   Turkey   $.774
19.   Switzerland   $.660
20.   Saudi Arabia   $.597
Value of currency

1.    USA   $1
2.    China   $.16
3.    Japan   $.011
4.    Germany   $1.34 (euro)
5.    France   $1.34 (euro)
6.    Brazil   $.46
7.    UK   $1.57
8.    Italy   $1.34 (euro)
9.    India   $.017
10.  Russia   $.031
11.  Canada   $.98
12.  Australia   $.95
13.  Spain   $1.34 (euro)
14.  Mexico   $.078
15.  S. Korea   $.00089
16.  Indonesia   $.0001
17.  Netherlands   $1.34 (euro)
18.  Turkey   $.53
19.  Switzerland   $1.08
20.  Saudi Arabia   $.27

GDP per capita

1.     Luxembourg   $88,797
2.     Qatar   $88,314
3.     Macau   $77,079
4.     Singapore   $60,688
5.     Norway   $60,392
6.     Kuwait   $54,283
7.     Brunei   $51,760
8.     Switzerland $51,227
9.     Hong Kong   $50,551
10.   USA   $48,112
11.   UAE   $47,893
12.   Netherlands   $42,779
13.   Austria   $42,172
14.   Australia   $41,974
15.   Sweden   $41,484
16.   Denmark   $40,933
17.   Ireland   $40,868
18.   Canada   $40,420
19.   Germany   $39,456
20.   Belgium   $38,723


My point here is that a currency's value is no indication of a nation's worth, wealth, or standard of living.  If Iraq was somehow magically transformed into the world's largest economy overnight it doesn't mean that they will have the world's most valuable currency.  For that matter it doesn't mean that their currency would increase in value at all.  


Now let's take a look at stocks.  (Market cap is derived by multiplying the stock's value by the number of shares of that stock.)

Largest Companies by Market Cap (in billions)

1.   Apple   $500
2.   Exxon   $400
3.   PetroChina   $265
4.   BHP Billiton   $250
5.   ICBC   $240
6.   China Mobile   $235
7.   Wal-Mart   $230
8.   Samsung   $225
9.   Microsoft   $220
10. Royal Dutch Shell   $220

  Approximate Current Stock Valuation

  1.   Apple   $432
  2.   Exxon   $91
  3.   PetroChina   $109
  4.   BHP Billiton   $63
  5.   ICBC   $5
  6.   China Mobile   $50
  7.   Wal-Mart   $75
  8.   Samsung   $1200
  9.   Microsoft   $35
  10. Royal Dutch Shell   $66


These are all approximations since stock prices fluctuate on a daily basis.  As you can see Samsung's stock is selling for almost three times the price of Apple's stock despite the fact that Apple's company is worth over twice as much.  So we can see from these charts that a stock's price doesn't tell you what a company is worth any more than a currency's price tells you what the country is worth, so in that sense I would agree that currencies and stocks are similar.  But there is no perceived value of a country based on the currency's valuation as Stryker stated.  And there is certainly no reason to assume that a growing economy would result in a higher currency value either.  Any time you hear a guru saying that a currency is the stock of a country you know it's time to stop listening. 



Then on Tuesday June 18 Enorrste said:

"... the CBI is stating that their CURRENT money supply of 33 trillion dinars, which is worth about $30 billion, is covered by 2.5 times with their $80 billion in reserves. In other words, their current money supply has 250% coverage. Having said that, let's assume that Iraq does what it says it will do and withdraws the large denominated notes beginning in January of 2014. We can reasonably suspect that about 7 trillion dinars are outside of the country. This would mean, then, that they would withdraw about 26 trillion dinars from circulation. Of course these dinars will have to be replaced, as they have said (otherwise they would have NO dinars in the country) and they have stated that they will issue 25 Billion dinars to replace the 26 trillion that they remove. Now, let's go one step farther...

The new money supplied within the country will amount to 25 billion dinars. If, as they say, they allow the VALUE of the dinar to rise to "about $1), then if they have $80 billion worth of reserves at that time, then they will have over 300% coverage of their money supply, in country. Furthermore, they could allow the dinar to go to $3 per dinar and still have over 100% coverage of their money, keeping them as the strongest currency in the world.

So what happens with the 7 trillion dinars outside the country? They are cashed in by speculators and end up as reserves by the countries that cash them in. Just as their are trillions of dollars sitting as reserves around the world (i.e., not a concern to our country), similarly there will be trillions of dinars sitting as reserves around the world and Iraq will not need to be concerned about them. In short, they will never return to haunt Iraq any more than our dollars have returned to haunt the US...They will announce a float and draw in the dinars within the country during the next 6 months to 2 1/2 years, and replace them with new small denominated notes as the value rises and the smaller notes become necessary for commerical activity within the country. They are on record that this will take about 2 years beginning in 2014.

Furthermore, they are on record that the issuance of the NEW currency will occur in January of 2014. IF they need small denoms between now and then (the next 6 months), assuming the float is announced shortly, then they will use the ones that were printed in 2003 and that are sitting at the CBI for that purpose (existing small denoms of the same currency we hold.) Bottom line: this is talking about the final stages in preparation to unfold the plan. This is ALL GOOD!"

http://www.dinarrecaps.com/1/post/2013/06/part-2-enorrste-tlar-dinar-alert-member-discussion.html


First of all, they didn't say that the foreign currency reserves now equal $80 billion.  Turki predicted that they would have that much in the FCR by the end of July, and that was disputed by the economic committee.  But let's just assume that it is now $80 billion.  All that would mean is that their money supply would probably just expand that much more, because their policy is a stable exchange rate.

After that he says that Iraq announced that they will replace 26 trillion dinar with 25 billion.  This claim is more accurate because they have said that they will remove three zeros from their currency which would mean that the value would go from $.00086 to $.86 and the money supply would go from a figure in the trillions to one in the billions, but they have always stated that in the context of a redenomination rather than a revaluation as Enorrste is suggesting.  Also, the figure of  26 trillion was the total cash outside of banks at the time which has now grown to over 33 trillion.  Enorrste is apparently subtracting the amount that they said they would remove from circulation in a previous statement from the current amount in circulation and concluding that the 7 trillion difference is dinar outside of the country that they're not concerned about, but in a redenomination all currency in circulation is demonetized no matter where it is. 

The next claim that Enorrste makes is that Iraq said they would begin removing the large denominations in January of 2014.  They have never said that.  They have always referred to removing the zeros and replacing ALL of the IQD with a new currency at a ratio of 1000:1 old for new.  The idea that they are only referring to the large notes when they talk about removing the zeros is guru BS.  I've written about this in "Deleting the Zeros" and included eight examples of other countries who issued statements about removing (cutting, lopping, chopping, slicing, deleting .... etc.) zeros from their currency and not once did it refer to larger denominations only.  In every case ALL denominations were demonetized and replaced with a new currency at a higher value with a smaller money supply.

In the next paragraph Enorrste claims that they said they would allow the dinar to rise to about $1.  Wrong.  Their currency reform plan is a redenomination that would replace the current dinar valued at $.00086 with a new dinar worth about $.86 which is close to $1, but there's no rise here.  No float.  No increase.  Just a neutral exchange as has happened dozens of times over the years with currencies all over the world that experienced hyperinflation as Iraq's currency has.


Juest a few examples, ladies and gents, of why you shouldn't listen to gurus.   


7/20/13 ... UPDATE!!!

Guys, we have a good discussion going here.  One that is free from rumors and intel and that gets to the heart of this investment - what is the currency reform plan coming from the CBI?  You won't find this on most sites so I'm going to leave the comments unmoderated.  All I ask is that everyone try to keep it civil and focused on facts.  Thanks.





 

203 comments:

  1. Excellent article. Thank you for taking the time to put this all together.

    Unfortunately logic and common sense mean nothing to the people who have spent their life savings on IQD and sit at the computer 24/7 with a box of Depends, waiting for Okie to land his magic 747 and hand out some kind of graduation certificate.

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  2. But these guys have great connections at the highest levels of gov't in Iraq and in the US. They've said so. They have high level contacts in major US banks that have secretly told them an RV is imminent. Gosh, how can you not believe people that are so well connected? LOL!

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    1. Not to mention my bank teller who works part time and makes $10.60 an hour told me that Wells Fargo has gotten their computer systems ready and they are educating their employees for when people come in to exchange their dinars after it revalues. How could a person with such connections to the company be wrong???

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  3. Guess who else swears by "deleting the zeros" means removing the large notes from circulation? If you guessed Kaperoni, you would be correct. Pure horse manure. Can't tell him any different though. He will avoid the conversation completely or just bash the ones who bring it up OR he won't post and/or delete the posts which address the subject. Since he is a mod on four sites and visits / talks on 10 sites. Who has that kind of time to do that much work nd not get paid for the countless hours. Hmmmmmm *taps finger on chin* But of course you can visit his "home site" and read the countless posts of dribble he has put out, since he makes sure he posts his links to them. Get those hits and don't forget to sign up for the text message service!!!! Best in dinarland, so they say. Very sad. Wonder why Kap seems to reference Enorrste a lot?

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  4. Here is Kap's brilliant explaination. Try not to laugh too hard.


    ******, you apparently don't know what "Delete 3 zeros" or "raise 3 zeros" means. It is a two part process. First is the raising of the exchange rate via a float "floating orbit of exchange", and second is the "Deletion of zeros" which is an Iraqi event and has nothing to do with us outside Iraq. This event is (more than likely when the dinar reaches 1 to $1 or about exchange rate) is when they will official declare the zeros are removed from transactions, will implement the "law of indebtedness" which will adjust all contracts, legal obligations etc. throughout the country. More importantly, smaller denominations will be in circulation for all transactions forward. Their is no redenomination of the paper currency notes or LOP as some want to think. As Saleh said, this event has to happen at the beginning of a fiscal period or 1st of the year in Iraq. Therefore, I expect the dinar to come out soon on this float (and IMF Article VIII), giving the remander of 2013 to reach the 1 to $1 or about rate. Then, a public announcement can be made to begin 2014 that they have "deleted 3 zeros."

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  5. Thanks for trying to save people Sam from the couch professors, but stupid is as stupid does. Why anyone would allow hard earned money to not work for them I will never understand?

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  6. Spot on Sam.

    True you should never listen to spewrews because they are all scam artist. Each of them know that RVs don't exist and that Iraq will redenominate. That is the beauty of their con. They convince thousands of mindless economically challenged lemings that Iraq's natural resources and future "economy" equals a 100,000% increase in the dinar value by repeating the same ignorance over and over until it becomes forum fact.

    What's sad is the stupidity that people will believe when desperate. When spewrews spout off mouth diareha like removing zeros equals a RV to one to one and people actually believe that Iraq is preannouncing over and over a 100,000% increase in their currency value then you have a situation where con men can work freely online unimpeeded. It's all due to complete ignorance of economics and websites that promote the lies such as DV. Anyone can take a look at DV and see that all truth and logic have been completely silenced. Any opposing views other than RV are abbolished. A dream come true for lie defenders such as Easyrider and Caz. It's also a perfect environment for Montana to sucker more unsuspecting "investors" into his worthless VIP scam. How convenient that the biggest spewrew of all Adam Montana gets to ban anyone speaking out against the lies so that his site will have nothing but GO RV stupidity repeated while he takes in new VIP members. Hopefully the proper authorities see what is going on and are just waiting for the right time to pounce.

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  7. April 18, 2011

    “The Iraqi ministry of finance said in February that the deletion of zeros from the local currency will help free the Iraqi economy from constrictions and will enhance the value of the Iraqi dinar, the daily reports. “

    Newspaper website: http://international.daralhayat.com/internationalarticle/256567

    A redenomination involves NO CHANGE IN THE VALUE of the currency. Then why will the removal of the three zeros “enhance the value of the Iraqi dinar” as this report states? Answer: it is NOT a redenomination!

    June 15, 2012, I wrote the following: “It is impossible to talk about a “raise” in the “value” of the dinar and talk about a LOP in the same sentence. A LOP is revenue neutral, whereas a revaluation involves a “raise” in the “value” of the currency.

    The removal of the large notes (remove the three zeros) does NOT affect the value of the currency. The RV (revaluation) which makes the small denoms have value ("about $1" per CBI statements) DOES INDEED raise the value of the currency.

    However, after the RV, those who have some of the large notes will benefit, because THOSE NOTES will also RAISE THEIR VALUE, only at the NEW value of $1 per dinar. The confusion for those who view this event as a LOP is that they have consistently misunderstood the meaning of "remove the three zeros".

    They think that the zeros are just LOPPED off, when in fact the CBI is quite clear that the "three zeros notes" will remain legal tender at least until mid 2014, AND that they will retain their value as legal tender.”

    If the large notes remain legal tender, then they will gradually have to be withdrawn since they hold $25,000 or more in value PER NOTE. The CBI has clearly stated that the “project to remove the three zeros” has been delayed at least until 2014. Between now and then we may expect the currency to FLOAT freely, as the CBI has stated, until it reaches $1 or so. At THAT time the removal of the NOTES with three zeros will occur, but not before.

    If they removed the 3 zero notes WITHOUT a float or an RV there would be no money in the economy. If, on the other hand, they simple removed 3 zeros from the VALUE of the notes (i.e., redenominated) then there is no benefit to the economy. However, both Maliki and Turki recently stated that release from Chapter VII would allow for the economy to grow dramatically AND for the value of the dinar to RETURN to its “true value.” The change in the currency regime will be from a “fixed” rate to a “free float” according to both the CBI and the IMF. It was also echoed by an article about 6 months ago which stated that 6 Middle Eastern countries, including Iraq, would shortly move from Fixed Rate currencies to Free Float currencies.

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    1. I'm going to respond in good faith that you won't delete your comments like you did last time you visited.

      Yes, the value will be increased when they remove three zeros because the value will go from $.00086 to $.86, but that only applies to the new dinar. The IQD will not increase in value and will eventually be worthless. The end result is no net change, but it's considered a good move because the people are more comfortable using it.

      All you really need to know about Iraq's currency reform plan is included in the indictment of Brad Huebner and Rudolph Coenen. Part of the case for fraud was their misrepresentation of the CBI's currency change as a revaluation that will enrich investors rather than their stated intent to redenominate which will have no net effect on the dinar's value. I suspect that you guys know that though, because you started talking about the float about the time that indictment was handed down.

      Delete
    2. Steve - "The confusion for those who view this event as a LOP is that they have consistently misunderstood the meaning of "remove the three zeros"."

      ROFL!!! The only confused person here is yourself. First up, your link doesn't work. Secondly, it is clearly you that doesn't understand a word of what the CBI, etc, have been saying all along:-

      "CBI has announced that it intends to implement a long-planned redenomination of the Iraqi dinar by eliminating three zeros from the nominal value of bank notes." - SIGIR quarterly report, July 30th 2010.

      April 13th 2011 – "Iraq’s Central Bank announced on Tuesday that the project of Iraqi Dinar re-denomination consisting of removing three zeroes is close to completion. The re-denomination project is believed to be a strategic plan that will be passed to the ministerial council and Parliament once complete. Iraqi economists believe the re-denomination of Iraqi Dinar will not have a major influence on the purchasing power of the Iraqi Dinar."

      April 16, 2011 – "An advisor of the Iraqi Central Bank, Dr. Mohammed Saleh appearance that the bank adheres to its policy regarding the removal of three zeros from Iraqi dinar traded at present. To that, the adviser to the Central Bank of the appearance of Mohammed Saleh, said that this experience had previously been applied in countries such as Turkey, which has deleted six zeros from the currency."

      June 24th 2011 – "Iraq’s Central Bank announced on Thursday that it is planning to delete the zeros from the Iraqi currency. The new currency will be printed after deleting the zeros and will include the Kurdish language in addition to the Arabic language."

      July 2nd 2011 – "The draft of the new currency will be put to a vote in the House of Representatives and if approved by Council House of Representatives, the redenomination project will be implemented. New banknotes will be introduced with dual Kurdish language designs. The Iraqi currency change will not have any effect on the international value of the Iraqi dinar and economy"

      Nov 28th 2011 – "Deputy chairman of the ICB Dr Muzher Saleh said the bank is working to issue the new currency in addition to coins in both Arabic and Kurdish. This will include a new 50 Dinar bill with a value of $43 (50,000 current note Dinar).”

      Feb 21st 2012 – "AKnews reports that the process of removing three zeros from the Iraqi dinar and replacing current banknotes with new ones will begin in September. The announcement, which will see the Iraqi Central Bank (ICB) re-print 30 trillion dinars ($26 billion), was made despite government fear over the project. The move to delete the zeros will reduce the number of bank notes in circulation and simplify Iraq’s payment system."

      "The change that will take place with the Iraqi currency will change the face value of the dinar and not the real value as measured by the value of Iraqi dinar against the dollar and gold," Sami Atrushi, Iraqi Finance Committee

      "Mahma Khalil, Member of the Iraqi Parliament and official spokesperson of the Economic Committee stated that the new bill will be printed by a European company and introduced to the market gradually and in a well-planned schedule to ensure it will not result in shocks and would not have a negative impact on the market,” explained MP Khalil. He added the exchange rate between the new banknotes and the old ones would be 1:1,000."

      Pretty self-explanatory - direct from the people actually in charge of the process. And very consistent.

      Some conmen and the conned that follow them just don't want to see / hear what's been staring them in the face all along...

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    3. Steve - "The removal of the large notes (remove the three zeros) does NOT affect the value of the currency."

      Iraq haven't removed any mass of large notes from circulation nor are they going to given they've already stated old notes will be redenominated 1000:1. Ask an Iraqi why there are no shortage of 25k notes - you know - those funny people who actually use the currency on a day to day basis. This is garbage pumper talk that's been debunked every single day for about 5 years. The CBI hasn't "removed any 25k notes" as Iraq's whopping 78tn Dinar money supply (and Iraqi's inside Iraq) continue to verify.


      Steve - "However, after the RV, those who have some of the large notes will benefit, because THOSE NOTES will also RAISE THEIR VALUE, only at the NEW value of $1 per dinar."

      After the redenomination, ALL notes will be exchanged new:old 1:1000 as explained by the CBI over and over again (and openly broadcast on Alsumuria TV to 30m Iraqis) to those who haven't blinded themselves with confused greed...


      Steve - "They think that the zeros are just LOPPED off, when in fact the CBI is quite clear that the "three zeros notes" will remain legal tender at least until mid 2014, AND that they will retain their value as legal tender."

      More confusion. Yes, 3 zeroes are going to be lopped off - AND there will a fixed-time period where both will be accepted as legal tender inside Iraq during the changeover - just like every other lop...

      - A 10,000 Dinar item (worth $8.60) will be dual priced and sold for either 1x 10,000 current NID note ($8.60 at 1163:1) OR 1x 10 Dinar new redenominated note ($8.60 at 1.163:1). The maths have to balance or it'll end up like Dell selling $499 laptops (which cost $300-$350 to make) for either $499 or $0.49 - pumper junk economics. Every firm in Iraq would be bankrupt overnight if they sold products for several hundred times less than what they cost to make. Duh! Just like a Spanish 1,660 Peseta product sold in Spain could be bought with either 1,660 Pesetas or 10 Euro's - both circulating at the same time during the Euro changeover. It's exactly the same thing.

      Quite obviously you don't understand how the lop process works (or what Iraq are genuinely planning once you strip out the pumper BS), and you laughably think that unless every banknote in the country will be exchanged overnight, "then it can't possibly be a lop", which is utter nonsense.


      Steve - "If the large notes remain legal tender, then they will gradually have to be withdrawn since they hold $25,000 or more in value PER NOTE."

      More deluded confusion. When they redenominate (delete 3 zeroes), you will exchange them at 1:1000 (you hand in 1x 25,000 Dinar note (with a value of $21.50 at 1163:1) and will get 1x 25 Dinar note (with a value of $21.50 at 1.163:1) in return. It's precisely the process of replacing notes at 1:1000 that reduces Iraq's money supply by 99.9% (what "deletes three zeroes" genuinely means) that causes the exchange rate to move by the same amount. This is what the central Bank of Iraq, Iraqi Finance Committee, SIGIR, etc, have all been saying all along. It's really not that hard to understand, and has never been about a get-rich quick scheme outside of pumper/guru-land.

      All you've done above is try and falsely project, confuse & conflate the value of a post redenominated non-inflated note onto a pre-redenominated inflated one, which makes about as much sense as saying "HOLD ONTO YOUR LARGE PESETA DENOMINATIONS AS THE 166:1 RATIO VS THE EURO MEANS EACH PESETA WILL BE WORTH €166!!!" which is utter nonsense. You simply don't understand how it works at all. Any of it.

      Delete
    4. Steve - "Between now and then we may expect the currency to FLOAT freely, as the CBI has stated, until it reaches $1 or so. At THAT time the removal of the NOTES with three zeros will occur, but not before."

      As usual, you have everything totally back to front. A floated Dinar will not move in value until a redenomination occurs precisely because it's redenominating that moves its value! Iraq have a huge 78tn (78,000bn) Dinar money supply but only $60bn-$70bn of $ to back its international value. Do the maths, and you'll see unless they lop, the current 1163-1200:1 **IS** the Dinar's fair value vs the $.

      Your ignorance of how currencies are valued is truly staggering. It's on par with saying "If I hooked up a 100 ton deadweight to my car, my car will make the weight lighter if I drive at 1,000mph". In reality, you won't be going anywhere until you reduce that deadweight from 100ton to 100kg - by lopping 3 zeroes off of it...


      Steve - "If they removed the 3 zero notes WITHOUT a float or an RV there would be no money in the economy"

      This is complete gibberish. The CBI aren't removing ***ANY*** 25k notes (other than replacing torn/damaged ones). This is a pumper lie already debunked by the CBI's own monthly M0 (banknotes in circulation) money supply figures (not to mention observable reality inside Iraq). They will redenominate them, but they aren't running round stealing everyone's 25,00k notes "in advance" of anything. Deal with it.

      In fact there are more 25k notes in circulation now than when the pumpers started falsely claiming "they've taken 90% of all 25k notes out of circulation, dude" as part of their sales pitch 5 years ago back in in 2008, (and their mindless followers who start parroting anything that sounds nice as 'sacred fact' without thinking how utterly stupid that sounds that Iraqi's are continuing to use the same number of 25k notes for grocery shopping / rent / mortgages, or how Western Dinar sellers always seem to have plenty of 25k notes to sell to the gullible, or how anyone is supposed to seriously believe 90% of money will be taken out of the economy without causing chronic deflation and street riots when no-one has any money left to buy even basic food)... Deluded to the core.

      Delete
    5. I can see that you are invigorated to deal with me, but I would ask that you keep your comments to the issue at hand rather than attack me personally (ad hominem).

      In answer to my "ignorance" of how currencies work, I would simply state that I used to have a Series 7 license and traded precious metals and currencies through Monex International in Newport Beach, CA. I also graduated with honors (cum laude) in economics from one of the most prestigious small colleges in America (Pomona College, Claremont, CA). Therefore, I challenge you to call me ignorant. We may disagree, but I am far from ignorant.

      Delete
    6. "Personal attacks". LOL. Interesting you run away from addressing any point, no? I too have traded currencies and precious metals and have a pretty piece of graduate paper. So what? If you genuinely do have a degree in economics (and that's not just another empty pumper claim based around the propaganda of "appeal to authority"), then that makes it even more absurd that you still do not understand how currencies are valued against each other in the real world or why a currency with a 80tn money supply but only $65bn reserves to back it internationally (Iraq) is already at its fair market value under 100:1, and there is no "missing value" to return to.

      The fact you appear to genuinely believe even the silliest debunked propaganda "Iraq is taking all their 25k notes out of circulation" suggests there is a gaping mismatch between claimed credentials and actual knowledge somewhere...

      "Oh yeah?!? Well I have a Harvard degree so do not question me" is pretty much the standard response for 60-80% of all pumpers (along with "I'm a military vet", "I'm a devout Christian", etc), so forgive me for not taking your credentials at face value.

      People who know what they're talking about discuss facts. People who don't talk about themselves, their past and why they should not be questioned as an attempted diversion tactic to addressing any point they have no answer to...

      Delete
    7. My response regarding my credentials was in direct answer to your question. Had you not asked, I would not have volunteered that information. However, you volunteered your background and I never asked. What's with that? Furthermore, you poo-poohed your own education as if it meant nothing. Is that what you really think? I said I had a Series 7 license. That doesn't mean just that I've traded. Anyone can trade.

      But you miss the point entirely. This isn't about your credentials or mine. It is about the issue at hand (what is the plan of the CBI?) For some reason none of you really wants to touch the topic directly. Instead you banty around it talking about "absurdities" that you present even while the CBI itself never addressed them. Therefore ALL of your arguments are "strawman" arguments. You make a case that does not exist, and then show how absurd it is. Well, if it DID exist, it would be truly absurd. But I have never presented a case that was absurd. Instead I have presented a logical case, and that presents you with a big problem, because you refuse to deal with the simple logic of the case. Instead, you deflect the issue and then defeat it, over and over again.
      Yes, I believe that the CBI is removing large notes from circulation even now. I can also prove it. I will, tomorrow morning, present articles that show clearly that the people on the street are complaining because of the lack of dinar currency available on the street. Even the banks are complaining because the notes they have are torn, burned, mutiliated, or otherwise damaged. Furthermore, the "dollarization" of the country is a DIRECT RESULT of the CBI's plan to reduce the large denoms within the country (notice I was very specific in that last phrase).

      I forgive you for not taking my credentials at face value. I never intended them to be held to any scrutiny from you or anyone else. Quite frankly, it's none of your business. You asked the question and I answered. If you didn't like the answer, why not just drop it? Instead, out of some "threat" you perceived, apparently, you decided to attack me personally. Go figure....

      "People who know what they're talking about discuss facts." Go back through this entire thread and give me one example where I have failed to do just that (other than my direct answer to your question about my education). Sorry. I've dealt only with the issue at hand, while others, including you, continue with the ad hominem attacks. The thread speaks for itself. I answer each post as clearly and succinctly as I can. I refuse to debase this to a "personality contest" in spite of the attempt by many of you to do so.

      I am pleased to see that Sam has done the same. His statement is clear: respect one another and stick to the issue, not the person (that's a paraphrase but I know that this is his position, since I've talked with him directly before.)

      Can you do that?

      Enorrste

      Delete
  8. I’m surprised that your readers are unfamiliar with these announcements from the GOI and CBI.

    Finally, moving from a fixed rate to a free float involves no risk whatsoever for the CBI. True market forces will come into play (for each buyer there is a seller, thus it is a zero sum game). The CBI will not have to enter the market unless it wishes to do so. The rise in the value of the dinar will be determined in an open market. As the dinar value rises, so will the value of the current currency (1000, 5000, 10000, and 25000 dinar notes). At some point it will not be convenient to hold a 25000 dinar note because of its rise in value. They will be deposited in banks and then destroyed by the CBI. As the rate rises farther the same will happen with the other "3 zero notes." As this occurs, the CBI has stated that they will introduce smaller denominated notes (the ones printed in 2003, the same currency that investors now hold but in smaller denominations). Thus as the large notes disappear they will be replaced with 200, 100, 50, 20, 10, 5, and 1 dinar notes. Incidentally, the CBI has recently posted on their site the 1 dinar coin, which heretofore had not been seen. This may mean that they are preparing to issue that coin sometime in the foreseeable future. All of other small denominated notes are also on their site, ready for distribution. The key is this: all dinars will be retained as LEGAL TENDER. This means that they cannot LOP, since a LOP involves a change in the larger notes from Legal Tender to notes that must be turned in. Saleh has stated that the dinar would become a "world reserve currency" for a long long time (that is a quote). How would that be possible with a LOP? It wouldn't. On the other hand, if the large notes that we hold are turned into banks, and then into our own federal reserve, they would indeed become a "reserve currency" to support the value of the dollar, just as the dollar is now help by other countries to support their own currency. If there were to be a LOP, why would Saleh make this statement? It only makes sense if the large notes become more valuable. Just at the $1000 and $5000 DOLLAR notes are still legal tender, but are not used in commerce, the same will happen with the large dinar notes.

    I don't make anything up. Everything I have written comes directly from the CBI, the GOI, or the IMF. If you come to our site you can find the SOURCE articles with little difficulty.

    Enorrste

    ReplyDelete
    Replies
    1. Steve - "As this occurs, the CBI has stated that they will introduce smaller denominated notes (the ones printed in 2003, the same currency that investors now hold but in smaller denominations)."

      Nowhere in any post that you've made have you outed yourself as a either a chronic lying pumper or one seriously confused individual than in the above sentence.

      FACT : Iraq are planning to replace ALL banknotes. ALL of them. The 2003 NID's will be demonetized after the changeover period (yes it is a lop and all lop's have changeover periods), the larger denoms will be replaced by new designs, and the smaller ones will actually be newly designed COINS - NOT notes. It is you who does not know what you're talking about:-

      New Iraqi Redenominated Banknotes:-

      - 100 Dinars (will be exchanged for 4x 25,000 current banknotes) will have the design of the Azwaip in Baghdad on the front, and the University of Baghdad on the back. ONE new redenominated 100 Dinar "University of Baghdad" design note will replace FOUR current red "Kurdish farmer & tractor (front) / King Hammurabi (back)" design 25,000k notes.

      - 50 Dinars (will be exchanged for 2x 25,000 current banknotes) will have design of King Codaa (Lagash II dynasty) on the front and a picture of Fort Ukhaydir (a Fort archaeological dates back to the era of the Abbasid) on the back. ONE new redenominated 50 Dinar "King Codaa" design note will replace TWO current red "Kurdish farmer & tractor (front) / King Hammurabi (back)" design 25,000k notes.

      - 25 Dinars (will be exchanged for 1x 25,000 current banknotes) will have a picture of King Hammurabi receiving the law on the front, and a picture of a peasant from Iraqi Kurdistan working in agricultural fields on the back. ONE new redenominated 25 Dinar "King Hammurabi" design note will replace ONE current red "Kurdish farmer & tractor (front) / King Hammurabi (back)" design 25,000k note.

      - 10 Dinars (will be exchanged for 1x 10,000 current banknotes) will have the Arab-Muslim image of the Dinar on the front, and a picture of the Hadba Lighthouse in Mosul on the back. ONE new redenominated 10 Dinar "Mosul Lighthouse" design note will replace ONE current green "Abu Ali Hasan Ibn al-Haitham (front) / Great Nurid mosque in Mosul (back)" design 10,000k note.

      - 5 Dinars (will be exchanged for 1x 5,000 current banknotes) will have a Kurdistan waterfall on the front, and a picture of an Iraqi palm on the back. ONE new redenominated 5 Dinar "Kurdistan Waterfall" design note will replace ONE current dark blue "Geli Ali Beg waterfall (front) / Al-Ukhether desert fortress (rear)" design 5,000k note.

      Delete
    2. New Iraqi Redenominated coins:-

      NB: Iraqi coins are measured in "fils" which are like US "cents" except there are 1,000 rather than 100 subdivisions, ie, 500 fils is 1/2 Dinar, 250 fils is 1/4 Dinar, 100 fils is 1/10th of a Dinar, etc.

      - 1 Dinar coin (will be exchanged for 1x 1,000 current Dinar banknote) will contain the design of a map of Iraq and highlight the Tigris and Euphrates. ONE new redenominated 1 Dinar "Iraqi Map & Rivers" design COIN will replace ONE current brown "Iraqi coin (front) / Mustansiriya School Baghdad (rear)" design 1,000k Dinar note.

      - 500 fils coin (will be exchanged for 1x 500 current Dinar banknote) will contain a larger image of just the Euphrates river. ONE new redenominated 500 fils "Euphrates" design COIN will replace ONE current bluish-green "Dûkan Dam on the Al Zab river (front) / Assyrian winged bull (rear)" design 500 Dinar note.

      - 250 fils coin (will be exchanged for 1x 250 current Dinar banknote) will contain a larger image of just the Tigris river. ONE new redenominated 250 fils "Tigris" design COIN will replace ONE current bluish-purple "Astrolabe (front) / Samarra Mosque minaret (rear)" design 250 Dinar note.

      - 100 fils coin (will be exchanged for 2x 50 current Dinar banknote) will contain an image of a Babylonian lion. ONE new redenominated 50 fils "Lion" design COIN will replace TWO current purple "Basra grain silo (front) / Date palm (rear)" design 50 Dinar notes.

      - 50 fils coin (will be exchanged for 1x 50 current Dinar banknote) will contain an image of a Mesopotamian palm. ONE new redenominated 50 fils "Palm" design COIN will replace ONE current purple "Basra grain silo (front) / Date palm (rear)" design 50 Dinar note.

      - 25 fils coin (worth half of 1x 50 current Dinar banknote) will contain an image of the Babylonian Ishtar Gate. TWO new redenominated 50 fils "Ishtar Gate" design COINS will replace ONE current purple "Basra grain silo (front) / Date palm (rear)" design 50 Dinar note.


      Anyone talking about "reusing 2003 notes", "only replacing some denominations", "new 1 Dinar notes" or "25,000 Dinar notes are being withdrawn before the redenomination" is either utterly clueless or chronically dishonest. The above information comes direct from the CBI and has also been openly broadcast on Iraqi TV and printed in over a dozen national Iraqi newspapers. It is fact, not opinion, that Iraq will replace ALL banknotes with notes and coins and that ALL notes will have dual-Arabic / Kurdish writing on them (current NID's do not). The Iraqi Finance Committee already have the new note designs in their possession including the ones pumpers falsely claim will be "reused 2003 notes" out of self-delusion.

      http://www.banknotenews.com/files/e6aeb4a9a73b43af93fb33b73f0c705d-2193.php

      Delete
    3. "'Central Bank Adviser, said the appearance of Mohamed Saleh: the Iraqi dinar is not an international reserve currency to be treated abroad; we aspire it to be the monetary policy of the Iraqi dinar portion of international reserves and this needs to be a long time,' he said."

      Why would Saleh state that the plan of the CBI is to make the dinar a world reserve currency if his plan was only to redenominate and not raise the value to a "world" level? If, as I have shown here, the plan is to RAISE the value and THEN redenominate, then this statement makes perfect sense, since there are ample dinars outside of Iraq. His further statement, as I have shown elsewhere on this thread, is that the existing dinar would remain "legal tender" for years.

      Enorrste

      Delete
    4. Steve - "Why would Saleh state that the plan of the CBI is to make the dinar a world reserve currency if his plan was only to redenominate and not raise the value to a "world" level? "

      He didn't say that at all, and you haven't "shown" anything beyond your remarkable persistent ability to deliberately misinterpret a chronically bad automated mistranslated misquote, then tell everyone "what he really said" as if it were his exact original words.

      The speech he made that quote he made that in was about boosting reserves, and indeed he has. The Iraqi Dinar will not be a prime reserve currency though for the same reason the Bangladeshi Taka or the Angolan Kwanza aren't reserve currencies:-

      1. They all have tiny GDP's under 0.2% of the world economy. Including oil exports.

      2. Their currencies aren't used internationally for trade (unlike the $ & €).

      3. Iraq is a very small country smaller than Canada, with a 3rd world economy and average national income of just $4.6k. They could double their wealth and they'd sill be poorer than Algeria or Namibia. They sell their oil in $, so oil exports has zero impact on the Dinar's value.

      You're just seeing purely what you want to see and twisting words to mean what you want them to mean whilst ignoring the obvious fact tiny 3rd world nations are not going to be reserve currencies no matter how much you want to believe it. There's nothing unique about Iraq at all - including oil.

      Delete
    5. The article below is from another member of the CBI and it clearly states that the plan is to make the Iraqi Dinar a “world reserve currency.” While it is clear that there is mention of the high reserves in Iraq, as well as the fact that they are a major oil exporter, it is also clear that the main point of this article is that the dinar will (not is) become a “world reserve currency.” The phrase “part of the international reserves” in the first paragraph makes this obvious.

      Therefore, your point that Iraq is a small economy is irrelevant. It is the “strength” of the dinar (not even its current value!) that will make it an international reserve currency, according to the article.

      Furthermore, the article references the fact that in the past (early 80s) it was also “among the world’s currencies.”

      Finally, it said that this cannot occur until the dinar is internationally tradable (“Iraqi dinar is not the currency of international reserve until it is handled abroad.”).

      Therefore, we see that the plan is to continue to strengthen the dinar, revalue the dinar (not specifically referred to here), redenominate (exchange to a new currency), and allow the dinar to take its former place as a “world reserve currency.”

      This article makes all of this perfectly clear, and the size of the country has nothing to do with it. It is the strength of the currency that is relevant (look at England, a small country with a world reserve currency).

      Enorrste

      3/9/2011

      Baghdad (news) .. Economic Commission confirmed that the parliamentary Iraq قادرعلى the improvement of the status of the dinar and adopt it as part of the international reserves, noting that Iraq has more than (80 to 90) billion dollars in the reserves of the Central Bank and this is positive for the benefit of the Iraqi dinar.
      A member of the Committee of Economy and Investment parliamentary MP / National Alliance / Abdul Hussain Abtan told the reporter Agency (news) on Saturday: 'To be sure, Iraq is able to adopt the dinar as part of the reserves of international and especially since he has a great resource in the field of oil and more than (80 to 90) billion dollars, the central bank reserves and the positive impact on the Iraqi currency against the dollar and makes the dinar as its currency position as it was formerly among the world's currencies'. The central bank called Alabtan the improvement of the status of the dinar against the dollar, albeit (1200) dinars per dollar is not correct بالشئ '. It is noteworthy that the central bank adviser said in an earlier statement 'of the Agency news' that the Iraqi dinar is not the currency of international reserve until it is handled abroad, stressing We as a policy cash aspire to be the Iraqi dinar is part of the precautions and this needs to be a long time. The benefit: The Iraqi dinar is the local currency convertible into other currencies, ruling that dealt in Iraqi dinars externally at present evidence that the bank instructions Antrzelatzmh taking out the Iraqi dinar, but the limits of (200) thousand dinars for the traveler. / End / 12. N. P /.

      http://translate.google.com/translate?hl=en&prev=/search%3Fq%3Dnahrain%26hl%3Den%26client%3Dfirefox-a%26hs%3Dbh9%26rls%3Dorg.mozilla:en-US:official&rurl=translate.google.com&sl=ar&u=http://www.ikhnews.com/news.php%3Faction%3Dview%26id%3D19443

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    6. Steve - "The article below is from another member of the CBI and it clearly states that the plan is to make the Iraqi Dinar a world reserve currency"

      No matter what articles you produce showing nationalistic aspirations / sentiments that all nations show to some degree to rally the people, the Dinar won't be a reserve currency any time soon because as explained, no-one uses it to trade with. $60bn of annual trade won't make any currency a reserve currency. It's TRADE that makes reserve currencies (USA, Europe, Japan, etc), not sticking banknotes in your sock drawer and praying for a miracle... Ironically, if the Dinar's value started rapidly appreciating it would guarantee that it *wouldn't* be used as a reserve currency (the prime desirable aspect of reserve currencies is stability), which is precisely why Shabibi held it's value stable in the first place...

      Delete
    7. I believe you are mistaken. While trade is a part of the equation, it is actually the strength of a currency that determines whether it is a "world reserve currency" or not. For instance, while the Indians have a very advanced level of trade, the Rupee is not considered a particularly strong currency.

      Currently the dollar is the single best reserve currency, followed by the Euro in second place. Farther down the line are the Sterling Pound, Japanese Yen, Swiss Franc, and the Canadian Dollar. It might be worth noting that the Swiss Franc is included even though their economy is miniscule compared to the others. I suspect that they don't have a robust trade, either, but won't take the time to search it out.
      Of course China is not included because its currency is not convertible, yet, in the world market (just as the Iraqi dinar is not yet convertible).

      Therefore, it is not so much trade as it is "strength" that has allowed a specific currency to rise to reserve status. Switzerland proves that point clearly.

      The fact that Iraq has announced that it plans to return to that status (it held reserve status in the early 80s) should therefore not surprise us. After all, they have over 100% coverage of their money now, and will continue to do so during the transition as the Plan is rolled out. Once the dinar reaches parity with the dollar, and the money supply is restricted to 25 to 33 billion dinars, Iraq will easily qualify as a world reserve currency, by then having over 300% coverage of its money supply. The fact that it has the 2nd largest known oil reserves will enhance their position as well. It is simply not the case that the GDP of a country is at all a determinative, as the Swiss show.

      Enorrste

      Delete
    8. Steve (enorrste) said "The fact that Iraq has announced that it plans to return to that status (it held reserve status in the early 80s) should therefore not surprise us. After all, they have over 100% coverage of their money now, and will continue to do so during the transition as the Plan is rolled out. Once the dinar reaches parity with the dollar, and the money supply is restricted to 25 to 33 billion dinars, Iraq will easily qualify as a world reserve currency, by then having over 300% coverage of its money supply. The fact that it has the 2nd largest known oil reserves will enhance their position as well. It is simply not the case that the GDP of a country is at all a determinative, as the Swiss show. "

      First no country can "make" their currency a reserve currency. It becomes a reserve currency when other country's central banks chose to use it in this fashion (so this all by itself points to translation problems with these articles).

      Second a reserve currency must float, it can not be pegged (as then you are in effect using the currency it is pegged to as the reserve with the additional variability of the intermedia exchange rate). Iraq is very unlikely to float their currency. As long as they have a single produce economy, they would be too vulnerable to fluctuations in oil prices. Note that even now the CBI can not get banks that it sells dollars to (via the auctions) to not add a 10% markup. i.e. the market is valuing the dinar at LESS than the CBI, so a float would only lower the price.

      Also there is the question of the stability of the country. The swiss franc is a very very small portion of reserves, but it is uses slight due the stability of the country. Iraq still might fall back into all out civil war, no one has that worry about Switzerland.

      Finally note that many places here make reference to Iraq having 2.5x the reserves needed to back their currency. This is false. They have 2.5x the reserves to back PHYSICAL CASH. They have about 33T in M0 (cash), but 75T in M1 (M0 + checking deposits) and 80T in M2 (M1 + longer term deposits with early withdrawal penalties). So indeed they are backing M2 by about a 10% margin which is a good thing for future stability and room to adjust things in the usual slow and tiny fashion.

      Delete
    9. "I believe you are mistaken"

      No Steve, I'm not "mistaken" at all. As John said - countries currencies become "reserve" when others choose to use them. You act like Iraq is the King dictator on Earth that can force everyone to do that just because one man made a nationalistic press statement. Absurd. Iraq can "announce" what it wants, just as I can "announce" myself Emperor of the Solar System, but the Dinar will not be a reserve currency as it's neither traded enough, stable enough (as a nation) or genuinely free-floating at market value. Any currency which has a black market rate (and the Dinar certainly does with a street value under 1200:1) obviously isn't going to be held as a serious reserve, whether you wish to believe that or not...

      Delete
  9. Iraqi Central intensify its efforts to delete the zeros of the Iraqi currency
    Tuesday, 13/03/2012 10:11
    BAGHDAD – ASHA: the Iraqi Central Bank continues to work on the project to delete the zeros of the Iraqi currency.
    The bank adviser said the appearance of Mohammed Saleh – in a statement to Radio Sawa on Tuesday – “The Committee is tasked with developing the project to delete blocks of zeros of the Iraqi currency in the process of completing its work,” noting that the project will be launched early next year.
    He noted the benefit to the new currency that contained the categories of paper and metal, stressing the importance of the project to delete zeros in facilitating financial transactions, and pointed out that government banks are the only outlet for the process of replacing the currency that will continue over two years.
    It is noteworthy that Article 36 of the Law on Central Bank of Iraq gives him the right to replace the currency
    And adjusted according to the list of control governing the work of the new currency.
    http://bit.ly/ycX6qF


    How does the term "blocks of zeros" not refer to notes? How could the term "blocks of zeros" refer to moving a decimal point (i.e., LOP)? Saleh is using the word "blocks of zeros", not me. He clearly is referring to "blocks of notes with three zeros" that will be removed.

    I could go on and on. There are many articles that make this quite clear, directly from the CBI itself.

    NOWHERE is there an article that refers to moving a decimal point 3 places to the left. NOWHERE.

    ReplyDelete
  10. CBI: Deleting the zeros law will strengthen value; Economist says Dinar to equal one USD

    Posted: October 10, 2011 Dinar/Politics

    Dinar is equal to the dollar

    “Deputy Governor of the Central Bank of the appearance of Mohammed Saleh: that the bill included proposals for a new currency and the groups that carried and details of technical and economic.
    Saleh pointed out during the permit media to switch the currency and the deletion of zeros decision taken by the executive branch and approved by the legislature, and that the project will not be implemented hastily, but will be taken among other factors to consider before you start to implement it, including the date of the financial year and the strength of the national economy, among other indicators in the favor of the view that
    This law, if approved, will have a positive impact on the Iraqi currency in several aspects of the need during the next phase, which will strengthen the value of the Iraqi currency…..

    Jassim (economist) added that the lifting of the zeroes of the three will lead to an exchange rate of one dollar per dinar to Jasim, who called to the need to follow the policies of peaceful citizens and to persuade them to get used for a period not exceeding two years.”

    It does NOT state that lifting of the zeros would EQUAL 1 dinar per dollar, but instead that it would LEAD to an EXCHANGE RATE of one dollar per dinar. This is the free float I have referred to.

    Furthermore, it will “strengthen the value of the Iraqi currency” according to Saleh. A LOP is revenue neutral (no gain in value).

    Finally a LOP doesn’t take 2 years to fully implement, whereas a freely floating currency up to $1 per dinar may well take about 2 years.

    I truncated this article to give you the most pertinent paragraphs. I suspect you won't have the courage to post any of these, but at least this is the truth. If you wish to debate or dispute it I am always available. I have never received a dime in compensation for what I do. I do not own or even run a website, although I am a guest on DA and have been a guest on several others in the past. I have no axe to grind here. I simply want the truth to come out. The founder of this site makes statements that cannot be supported by the documents, whereas I have supported my statements as just shown, from the CBI itself. Therefore, it is incorrect to say, for instance, that "every guru knows that it will be a redenomination." Actually, it is more accurate to say that almost all gurus believe it will be an RV. I, however, hold a different view, along with Kaperoni, namely that the CBI will float the currency and let the market determine how high it will go.
    Time will tell who is correct. I hope you have the courage to allow me to respond to your calumnous statements about me.

    ReplyDelete
  11. Thank you for posting my comments. Incidentally, Steve and Enorrste are the same person, namely me. I have researched this investment for over 7 years and am well versed on the actual articles that are available from the CBI and the GOI. I am also well versed on articles from economists and misguided members of the Parliament, such as Jabouri, who mistake the actual plan for what the CBI has itself posted. I admit that there are articles that talk about redenomination, although very few come from "official" sources, such as the CBI.

    I went back to research some of DinarDouchebags previous posts, in particular his answer to the normal statements made by the gurus. I will address only one (many of his responses were well done, incidentally). The author of this page made a comment to the statement that the dinar will return to the value it once held in the past. His response was that in 1995 the value of the dinar was 3000 to 1, implying that because of this the statement was false. However, the Ministry of Finance and CBI are clear on this point as well in stating that it wanted to go back to a previous value. Here is the quote, from 2006:

    “The Ministry of Finance together with the Central Bank are studying a proposal to raise the value of the Iraqi dinar in order to return it to previous levels where one Iraqi dinar was valued at 3.33 US dollars.”

    Further elaboration on the plan that was being worked on was also given in the same article:

    “A statement by B.J. AL Zubaidi, the Minister of Finance, in which he said that he had suggested to the Chairman of the Central Bank, Dr. Sinan AL Shibibi, that three zeros be taken from the Iraqi Dinar in order to raise its value so that one Dinar be equal to a Dollar.”

    http://www.iraqdirectory.com/DisplayNews.aspx?id=1593

    Then in August of 2008 another statement was issued:

    ”Finance Ministry has prepared a plan to increase the value of the dinar against the dollar and then delete the three zeroes from the dinar's value to contribute to the advancement of the Iraqi economy during the coming period.”

    Here we now were able to see that there is an order of events that will occur, with the raising of the value of the dinar coming first, and then the “delete the three zeros” afterwards. At the time I’m sure that everyone invested in dinars wondered what “delete the three zeros” could possibly mean.

    http://translate.google.com/translate?hl=en&ie=UTF-8&sl=ar&tl=en&u=http://www.foratnews.com/paper.asp%3FID%3D8383&prev=_t&rurl=translate.google.com&twu=1


    On January 10, 2010, a further clarification of this long process was revealed:

    “The CBI begins the end of the year and gradually replace the currency now in circulation a new currency which zeroes deleted within the strategy to reform the monetary system started in 2005.”

    We finally got a clarification of the “delete the three zeros” meaning: it refers to the removal of bank notes with 3 zeros on them from circulation over the remainder of that year (the process has obviously been delayed). Furthermore, the CBI was nice enough to refer back to the beginning of this long planned process, which it said was begun in 2005 and which I have now documented to be the case.

    http://articlesofinterest-kelley.blogspot.com/2010/02/two-currencies-coexist-together-and.html

    No mention of redenomination here, and this is directly from the source, the CBI, 3 to 7 years ago.

    Enorrste

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    Replies
    1. Welcome to reality. I hope the trip from fantasy land didn't take too long.

      Iraq has produced over 75 trillion dinar (it's right on the CBI's website, if you consider that a credible source). As Sam has repeatedly shown, their annual GDP is less than $200 billion. It is mathematically impossible to revalue the dinar by any more than a few pips. An RV to even 10 cents would make their money supply more than triple their GDP. It is unsustainable. It is an absolutely ridiculous notion. Currency is NOT wealth. It is a medium of exchange and a store of wealth. You can try to convince yourself and your subscribers all you want but it still won't make it true. The laws of mathematics are absolute and not subject to interpretation. One plus one will NEVER equal three (even if a million people believed it did).

      By the way, Iraq could easily make the dinar worth whatever they wanted through demonetization. It's a simple mathematical equation. They could make it worth $3 if they wanted. But they wouldn't have an M2 of 75 trillion after they were done. So, therefore, it won't change the purchasing power of the notes one bit. Unless, of course, you're naive (or intentionally deceptive) and don't believe that prices will also change as a result. To believe in an RV (not a redenomination), you'd have to believe that can of Coke that cost 1,000 dinar (85 cents) in Iraq before the demonetization will still cost 1,000 dinar ($3,000) after the demonetization (and that people would actually pay it). Or you'd have to believe that Iraqi banks that were owed 1 million dinar ($857.63) before the demonetization are still owed 1 million dinar ($3,000,000) after the demonetization. It's absurd. But, then again, this is the alternate universe of dinaria which is devoid of reason. I hope you can stay in the real world for a while and visit.

      Delete
    2. Both you and Brian seems to enjoy using M2 as a "money supply" figure, when, in fact, the rest of the world uses M1. If you look at the CBI website you will see that M1 is about 33 trillion dinars, as I stated in a post here. Furthermore, the CBI ITSELF only refers to M1, and never to M2. Therefore, if we are going to talk about apples and oranges, the big boys talk apples and you are both talking oranges. I respectfully suggest that we ALL use the numbers that the CBI itself uses in any of its public announcements.

      In support of that, let me show you the M1 and M2 figures in America:

      M1: 2.5 trillion dollars (what the US calls the "money supply"
      M2: 10.6 trillion dollars

      Now, we both know that the US itself only uses M1 publically. Therefore, again, respectfully, I suggest we join the "big boys" and talk on their level.

      Bottom line: the CBI says the money supply is 33 trillion dinars. I can accept that.

      With regard to your next point, I would refer you to the economist from the CBI who gave a seminar and said quite plainly that if you paid 1000 dinars for 1 pack of cigarettes before the revaluation, then you would be able to use the SAME 1000 dinars and buy 1000 packs of cigarettes afterwards. I didn't say this. An authorized economist from the CBI said it as a symposium created for the purpose of educating the people. Why haven't you seen this? It was in the media we all watch.

      Finally, the CBI is clear that the money supply will drop by 1000 times as the process unfolds. They said it. I didn't. Money supply will go from 33 trillion dinars, currently, to 25 billion dinars. This eliminates the "affordability" issue entirely. With over $70 billion in reserves, and more coming from release of Chapter 7 (some say about another $70 billion), they will have over 275% coverage of their projected money supply. We have about 15% coverage of ours, and our currency is supposedly strong. Now you can see how the Iraqis claim that their currency will become the strongest in the world.

      Delete
    3. M2 is the money supply, and the rest of the world regularly does use that. The CBI has referenced its M2 before plenty of times. As have the IMF & World Bank in their Iraq reports. So that's another lie you've told. The only people obsessed with only banknotes are Dinaraholics. M0 is banknotes. M1 is M0 + demand deposits. M2 includes savings accounts, etc. But since bank accounts, savings accounts, bonds, stocks, etc, are all lopped at the same time (as the CBI have said), that's why it is used.

      Steve - "With regard to your next point, I would refer you to the economist from the CBI who gave a seminar and said quite plainly that if you paid 1000 dinars for 1 pack of cigarettes before the revaluation, then you would be able to use the SAME 1000 dinars and buy 1000 packs of cigarettes afterwards. I didn't say this."

      No but you did misinterpret it. I think you'll find that's another baseless mistranslated myth parroted as fact, which is why you unsurprisingly haven't provided an original source that doesn't involve a pumper "interpreting" it "correctly". Here's what the CBI have actually said in their own words, which of course, you've chosen to run away from addressing earlier...

      The quote you claimed actually said "1,000 Dinars buys 1 pack of cigarettes now, but also said "the exchange rate between the new banknotes and the old ones would be 1:1,000". Which is what we've been telling you all along, but you've been too blinded by greed to understand. Shabibi also said - in plain English - during his Washington visit the exact opposite of what you claimed he said. It's a lop - deal with it.

      Steve - "Money supply will go from 33 trillion dinars, currently, to 25 billion dinars."

      Yes by lopping, as the CBI have said. Just like M2 will go from 78tn to 78bn Dinar when they delete 3 zeroes - as the CBI have also repeatedly said, and as you keep ignoring as it doesn't fit in with your pumping...

      Delete
  12. Replies
    1. Sorry Steve. My fat fingers accidentally deleted this comment where you quoted my comments on the devaluation and Hugh Tant. Feel free to resubmit it.

      Delete
  13. Here is the post that I referred to above. It took a bit to find it again:

    http://dinardouchebags.blogspot.com/p/fact-fiction.html

    The dinar was devalued when we invaded Iraq and now they're going to return it to its former value. Actually the CBI website tells you the history and it states very clearly that the exchange rate was 3000:1 in 1995, eight years before we invaded. It depreciated due to sanctions and overprinting which caused hyperinflation. It was not devalued by coalition authorities. I think this belief may have started because of the Hugh Tant interview where he said that the dinar had been devalued, but it's obvious from the context that he was talking about depreciation through the years and not a policy by Coalition authorities to devalue it.

    Iraq was involved with the Saddam Hussein regime for 26 years, from the early 80s, and it is to THAT time that they wanted to return, not 1995.

    ReplyDelete
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    1. Steve - "Iraq was involved with the Saddam Hussein regime for 26 years, from the early 80s, and it is to THAT time that they wanted to return, not 1995."

      There's simply no "missing" value there to "return" to as all the 1980's Dinars at that value were demonetized years ago. It's as nonsensical as saying "Obama is going to RV the $ by 35x because the $ used to be worth 35x more vs gold than today, back when the average income was $11.3k, the average house was $86k and the average car was $5.4k". It's just silly confused nostalgia trying to arbitrarily compare decades apart currency values whilst also trying to ignore the elephant in the room of 2,000x higher money supplies that devalued it in the first place! Ignoring the core problem - then declaring the symptom is the same as the cure is like saying "the cure for chemotherapy related hair loss is baldness"... This is 'pumper logic' in a nutshell...

      In the 1980's Iraq had a money supply of just a few billion as did Kuwait and their currencies were similar in value. Today Iraq has since printed almost 80 TRILLION Dinar - but Kuwait's is still only tens of billions. This is the real reason why the Iraqi Dinar fell by 2,000x fold vs the USD & Kuwaiti Dinar (and every other country who hasn't inflated their currency). If you cannot grasp even the basic fact of why printing 2,000x more money over 25 years causes your currency to fall 2,000x over 25 years, it boggles the mind as to how you can run your own website / blog "educating" people on the Dinar's history, when you clearly don't understand it, or inflation / currencies in general yourself.

      Back in the real world : In the 1970's, the Dinar rose to 1 Dinar = $3.3778 which remained until the Gulf War. This peg value was mostly artificial, evidence of which lies in the fact the black market rate was 6x higher ($1 = 3 Dinars) meaning no-one was willing to pay its *over-valued* arbitrary peg in reality even with Iraq's oil industry in full flow (just like North Korea pegged value and real black market value are also almost 9:1 today). This $3.3778 value was using what are called "Swiss Dinars" (due to Swiss printing plates used) and the Dinar was relatively strong vs the $ because it wasn't overprinted.

      After sanctions, Swiss printing plates weren't available and new inferior quality "Saddam Dinars" were introduced and due to massive overprinting, the Dinar was rapidly devalued to below 1000:1. The sad truth is, most people who use this 1 Dinar = $3 of the old Swiss Dinar as an "RV" benchmark don't even realize that the "RV" old-to-new value correction they're waiting for already took place in 2003 when holders of the old Swiss Dinar changed them up at a rate of 150:1 for the NID (New Iraq Dinar), ie, they were given 150 New Dinars for each old Swiss Dinar they handed in, whereas the Saddam Dinar were exchanged only for 1:1 for the NID.

      The over-printed NID's you hold (and Saddam Dinars) have never ever had any exchange rate even remotely approaching 3:1. Only the pre-1991 "Swiss Dinars" did, and that 150:1 "RV" already took place back in 2003, long before most modern Dinar speculators even bought post 2003 NID's and before the scam pumper bandwagon started. The only way of getting back to near parity vs the $ is via a lop (reducing Iraq's money supply from 78tn to 78bn in line with other countries). There's simply no 3:1 "missing" value to "restore" the Dinar to via an RV because the modern NID banknotes never had that pegged value in the first place, and the pre-NID Swiss Dinars were already corrected for that back in 2003.

      It's amazing something this simple still needs explaining today in 2013, especially to someone who amusingly claims he's been researching this for 7 years.

      Delete
    2. Steve, you are delusional. Sam used a great analogy several months ago to illustrate the absurdity of this argument. A brand new Ford automobile used to cost $129 to buy new back in the 1920s. Because it "used" to cost that much, should we expect to pay that at the dealer if we want to buy one now? Of course not. It's ridiculous. It's not the same car. It's not the same materials or features. Just as you cannot compare 2 automobiles, you cannot compare 2 currencies. The Iraqi dinar today is not the same dinar that existed 20 years ago. They share the same name. That's it! Ford could resurrect the Model T and start selling it again but it would not cost $129 to buy. It's willifully ignorant to suggest that the dinar in use today is no different than the dinar used 20 (or 50) years ago and, therefore, should be valued the same. Other than the name, there is nothing remotely similar between them. It's apples and oranges.

      Delete
  14. Steve apparently can reason to himself that a country would announce for years and years its intention to RV their currency 100,000 to 300,000%. And while making these announcements the street value can drop 10 to 20%.
    Steve. Can you explain why in many of the remove 3 zero articles the officials say that the process has been done before in many different countries, and they name countries like Turkey that lopped? None of the countries they name, nor any country for that matter, has ever done what you claim.

    ReplyDelete
  15. It's like beating a dead horse with some of these guys. Ok, I'll make it really simple. Saddam set his own rate, so when the US came in we reset their whole banking system and started it from the ground up (banking tech and currency). Any reference before 2003 is irrelevant. Everything after that point has been designed to increase their reserves while keeping inflation in check. Sure there have been a few fluctuations of the rate, but that was a result of the GOI not talking to the Central bank and distributing cash without permission. Come on man it's all laid out in several WIKI leaks like this ( http://dazzlepod.com/cable/08BAGHDAD2854/ ). They printed up so much of this crap that this thing can go on for years as they increase their foreign reserves and wait for just the right second to RD and not take a hit when they take their old trash back in (RD's aren't cheap), and an RV is a nation killer. Show me a note past 2010. Just saying.

    ReplyDelete
  16. Just re read Articles 36- 42. http://www.cbi.iq/documents/CBILAW-EN_f.pdf If that gives you warm fuzzies so be it.

    ReplyDelete
  17. I agree with steve on this, its becoming more and more apparent that they are going to raise the value, and not r/d first. if they were going to r/d that process would of been done, and already active. i dont go on sites anymore, and am banned from d-vets for bashing on montana, so i am not trying to kool-aid it up, but it is pretty clear, read the articles on the dinar since chap 7 release , its 5 rv style articles to 1 r/d article......bash away, but callingfoolsout, and networth, try to be intelligent while your bashing me....

    ReplyDelete
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    1. Thank you for your support. We have talked before on a couple of calls. I'm glad to know that you are in agreement with an obviously stated plan by the CBI itself. LOPsters can point to no PLAN from the CBI, unfortunately, to support their opinion.

      I am a theologian. In biblical studies there are two terms, and they apply here. The first is "exegesis." This means letting the document tell YOU what it means. The other term is "eisegesis." This occurs when a person "reads into" what is in front of him his own preconceived views. All heresy comes from eisegesis.

      Similarly, those who refuse to allow the CBI to state its own case, but instead insist on "reading into" whatever they find a LOPster theory, are practicing eisegesis.

      Having done this for over 40 years (I went to seminary) I know eisegesis when I see it. Those on this site, unfortunately, have their blinders on. I wish that weren't the case, but it is.

      I welcome a reasoned and reasonable discussion on this. I am aware that the CBI has been shown to have used the word "redenomination", for instance. However, they have always done so in the context of issuing a new currency (the definition of redenomination). When one sees that the process involves stages (first float, then issue small denoms, then begin withdrawing large notes while at the same time issuing a new currency), then it is also easy to see that the process is revaluation (even if over time) and THEN redenomination. That is the process and the order. It cannot be reversed. When the time comes to redenominate it will truly be a neutral event (old small denom notes for new ones with 3 languages). This MUST happen AFTER the revaluation. I posted an article that specifically stated this earlier last evening (above). I personally believe even after this "redenomination" that the dinar will continue to rise, but that is open for speculation, which we need not entertain here.

      Delete
  18. The following reply is to BrianSimpson65, Dave D, Chuckles, and Networth.

    First, the value of $3.33 was given by the CBI as the “benchmark” to which it wanted to return. I did not make this up. It is in the article above. Therefore, they are clearly referring to a “real rate” that existed prior to the Saddam Hussein regime. BrianSimpson65 himself refers to that rate as an earlier real rate, prior to any wars in Iraq.

    Therefore, this is the CBI’s plan, not mine.

    Second, the plan was initiated in 2005, two years AFTER the dinar had already fallen to 4000 to 1. The plan was recommended by the Ministry of Finance and accepted by the CBI a few months later. It was originally to be a 7 year plan. Again, the articles are above as I posted them. This is their plan, not mine.

    Third, the money supply is not nor ever has been 80 trillion dinars. In fact, it was 23 trillion in 2007 and has risen to about 33 trillion today. This information is from the CBI, not me.

    Fourth, the CBI has stated on numerous occasions that the plan is to reduce the money supply from 33 trillion dinars back to 25 billion dinars. They have stated that this will be done by removing the notes with 3 zeros on them, gradually, and replacing them with the smaller denominated notes (1 to 200 dinars each). Again, this comes from CBI articles, not me. The process will take at least 2 years, according to the CBI.
    Therefore, as the process unfolds, the value of the dinar rises and the money supply falls. It is really just that simple. I have included articles that make the process clear and could produce more, but clearly I am arguing against a blank wall (those who do not want to know the truth). I don’t care if you want to believe in a LOP. Go for it. However, you are mistaken.

    Fifth, the cases in which other country’s RDs are mentioned have NEVER come from the CBI directly. They have come from economists whom we have shown do not understand the process (like you all, they believe in a LOP). These are the same economists who say that the “time is not right” to begin the process.

    Sixth, both the CBI and Parliament are on record that they are ready to begin the process, which starts with changing from a fixed rate to a floating rate exchange regime. We have published an extensive article from the IMF that explains the process in detail. We have linked that article to what is occurring in Iraq specifically, as well. If you doubt this look for an article on the IMF web site that refers to “moving to a floating exchange rate regime.” Or, you could find it on DA.

    Seventh, the Saddam Hussein currency, which was grossly overprinted, is the very reason why the CBI elected to change the currency. However, for a number of reasons, they decided to extend the entire process for 7 years (now going on 8 ½) due to the political and security problems in the country. Having made this decision it was clear that they elected not to exchange Saddam dinars at 1000 to 1 for the NID (new Iraqi dinar). Instead, they traded 1 to 1. For this reason the current currency came out with a money supply of 23 trillion dinars, equal to that created by Hussein.

    ReplyDelete
    Replies
    1. Steve - "First, the value of $3.33 was given by the CBI as the “benchmark” to which it wanted to return. I did not make this up. It is in the article above. Therefore, they are clearly referring to a “real rate” that existed prior to the Saddam Hussein regime. BrianSimpson65 himself refers to that rate as an earlier real rate, prior to any wars in Iraq.

      Therefore, this is the CBI’s plan, not mine. Second, the plan was initiated in 2005, two years AFTER the dinar had already fallen to 4000 to 1."


      OMG, you claim you're not a pumper but are frantically throwing around every "doublespeak" pumper propaganda lie in the book! The "2005" document ("MOP report") you're referring to is actually a 30 year old Reagan-era document that was merely digitally archived in 2005:-

      "In turn, The Guidance For Technical And Economic Feasibility Studies And Post-Project Assessment Of Development Project (Regulations No. 1 for the Year of 1984 and it’s amendment for the year of 1990) has specifies a series of steps to be undertaken, which lead to the completion of a Capital Budget."
      http://www.mop.gov.iq/mop/index.jsp?sid=1&id=295&pid=259&lng=en

      And was debunked by Sam months ago here:-
      http://dinardouchebags.blogspot.co.uk/2012/08/mop-report.html

      Your "2005" document openly states in its own heading that it's almost 30 years old, written during Reagan's first term in office before the Dinar fell in value, seven years before even the FIRST Gulf War, and if you view other sub-pages such as "Telecommunications projects", they talk about "new projects" like "Telex". LOL. ;-)


      Steve - "Third, the money supply is not nor ever has been 80 trillion dinars. In fact, it was 23 trillion in 2007 and has risen to about 33 trillion today. This information is from the CBI, not me."

      Why do you persist in lying through your teeth about such blatantly obvious easily verifiable things? Here's what the CBI actually says in their own words - "Enorrste Orwellian double-speak" aside:-

      CBI's definiton of Money Supply : "Money Supply (M2)" - Monthly : Currency in circulation outside of banks + deposits in commercial banks
      http://cbi.iq/documents/Key_Financial_Indicators_Documentation.pdf

      M2 Money Supply - 78.465 trillion Dinar - Q1 2013
      http://cbi.iq/documents/Monetary_Aggregates_f.xls

      Iraq's money supply - that is spendable money in circulation - is 78 trillion of which 33tn is banknotes and 45bn is banking deposits. That is real fact and is what anyone with an Internet connection is capable of verifying for themselves on the CBI's own website in above links. Now dry your eyes and deal with it. Whether you pay by cash or cheque, it is money that's part of the money supply.


      Steve - "Fifth, the cases in which other country’s RDs are mentioned have NEVER come from the CBI directly."

      Good God man, you're living in a parallel universe, aren't you:-

      "This experience had previously been applied in countries such as Turkey, which has deleted six zeros from the currency" - Dr Saleh, CBI, April 16th 2011

      I see, so the Vice Chairman of the CBI has nothing to do with the CBI...

      I stopped reading here. You're not even attempting to hide your systemic chronic dishonesty.

      Delete
  19. However, in announcing the 7 year plan they also stated directly that they would eventually reduce the supply to 25 billion dinars. Read the article, or ask me and I will repost it.

    Now, since this is the CBI plan, criticizing anyone who repeats the plan is a waste of time. If you want to criticize, I suggest you show us all how this is NOT the plan. You cannot do this. I publish a book on this in 2010 and laid it all out clearly with documents from the CBI. It’s their idea, not mine.

    Now, as the final phase of the plan approaches we need look for the following: first, a change in the exchange rate regime to a free floating currency (stated to be coming by the CBI, IMF, and an article that states that 6 other ME currencies will change at the same time). This will cost the CBI nothing.

    As the free market raises the value of the dinar, the large notes will gradually become withdrawn as they become more and more difficult to use in daily commerce. According to the CBI this process could take up to 2 years. It is my opinion that the rate of withdrawal will accelerate when the dinar reaches $1 in value. At the same time the dollarization phenomena in Iraq will similarly disappear as the dinar becomes more valuable than the dollar.

    The CBI has held seminars around the country with experienced economists teaching the people the details of this process. We have those articles as well. One of them states quite clearly, that if you bought a pack of cigarettes for 1000 dinar prior to the rise in value of the dinar, then you could buy 1000 packs of cigarettes with the same 1000 dinar note after the raise in value. I’m surprised you haven’t seen this “CBI authorized” article. It came out over a year ago.

    This plan fits in with a global plan to balance currencies based on the individual country’s underlying wealth (this is available from the IMF in an article as well, listing over 200 categories of “underlying wealth”, including natural resources, education, population, tourism, national parks, infrastructure, etc. The article is quite specific.)

    Networth, I am not delusional. I never stated that the dinar of the past is the same as the dinar today. In fact, it clearly is not. For you to attribute this supposed belief to me betrays your failure to read carefully. The old dinar was the Swiss dinar; it was replaced with the Hussein dinar; that was replaced with the current NID; and the NID will eventually be replaced with the new dinars with 3 languages (not yet printed). Clearly the old Ford isn’t the same as the new one. Duh….

    Having said that, however, it is not I who use the same term (dinar) but rather the CBI that does so. Blame them if you don’t like their use of the same term.

    Chuckles, you have a right to state that “Any reference before 2003 is irrelevant.” Unfortunately the CBI disagrees with you. It is their plan, opened in 2005, that specifically refers to a rate of $3.33 in the 80s, before Saddam Hussein, that they want to get back to. Argue with them.

    Finally, the CBI has never denied that it is increasing the money supply. They have been quite transparent that it has gone from 23 trillion dinars to the current 33 trillion dinars in the last 10 years. So what? That is their prerogative. However, to IGNORE their own statement that the plan is to eventually REDUCE the money supply to 25 billion dinars is simply like an ostrich sticking its head in the sand.

    Enorrste

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  20. Now, two more short points: first, Saleh is specific that the current NID will remain legal tender throughout this process. Second, as the money supply falls, the value of the dinar rises. The opposite is also true: as the value of the dinar rises, the money supply falls. The large denominated notes are gradually destroyed. At some point in the process the small denoms of the NID, printed in 2003, will be issued as the value rises (this, per Saleh himself). Then, sometime in 2014 as the current plan is expressed by both Parliament and the CBI, a new currency (3 languages) will be issued in 1 to 200 dinar denominations. In time the NID small denoms will fade away through use, but will forever remain legal tender, per Saleh.

    Dinars outside of Iraq will become “reserve notes” for various countries, to be held as such “for a long time,” according to Saleh.

    All of this is available in articles directly from the CBI through the press.

    Enorrste

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    1. Steve - "Second, as the money supply falls, the value of the dinar rises"

      Correct.

      Steve - "The opposite is also true: as the value of the dinar rises, the money supply falls."

      Wrong! You could peg the Dinar, $ or any currency higher overnight, and it will not affect the internal money supply one bit. An "RV" is nothing more than an external peg adjustment. Iraq has already "RV'd" the Dinar from 1170:1 to 1163:1 and the money supply rose. China RV'd the Yuan - their money supply rose. The rise is the effect, the fall in money supply is the cause. They are NOT interchangeable because RV's are external peg adjustments (appreciation) - they do NOT affect the money supply.

      You're arguing "a ball can bounce before it gets thrown". That is plain and simple wrong. The only thing a declared RV will do is create a black market value that's lower than the declared value and a further collapse in trust in the currency, increasing dollarization. Iraq already has this problem with the street value (ie, real market value) of the Dinar being under 1200:1 despite a declared 1163:1 peg, which is the real reason Iraqi's continue to prefer $. Learn how currencies actually work in reality away from pumper forums.

      Delete
    2. I generally agree with you here, surprisingly. However, I can only agree within the context of a fixed exchange rate regime. In a freely floating exchange rate regime my statement is correct, not because it is axiomatic, but because the specific case that we are discussing, namely the Iraqi dinar, will have the supply reduced as the value rises. You are right, as I am, that the driving force in an increase may be a reduction in money supply. However, when worldwide demand is taken into account, it could be argued that the rise in the value of the dinar would PRECEDE the CBI's reaction by reducing supply. In any case, my comment was directly solely toward the dinar, and not to any other currency situation where, obviously, it would not be true, as you have noted.

      Enorrste

      Delete
  21. Thank you, SamIAm, for allowing me to state my case. I appreciate this greatly. I don't fear being called names ("delusional", for instance), but I fail to see how it leads anywhere to do so. Instead, I welcome a spirited discussion. I know the available facts and will defend my position vigorously, as long as others step up to the same level of intelligence and integrity. Bring on the articles! But don't give me any "guru" crap. In that area you and I are totally in agreement!

    Enorrste

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    1. You are quite welcome to state your case here, and I always encourage my readers to try to keep it civil. Unfortunately that's an uphill battle most of the time as passions run deep on this. I use the "douchebag" references mostly for fun and humor, but I do believe in civil discourse.

      As for your take on exegesis and eisegesis, there is also the concept of allowing scripture to interpret scripture. For example, the natural meaning of "destroy this temple and in three days I will raise it up" is that Jesus could construct a temple like the one in Jerusalem in three days. However we know from other passages that the word "temple" is often used figuratively to refer to the human body and that Jesus was referring to his resurrection. So it's best to study one statement in the context of the entire subject matter and not to isolate it with a literal interpretation.

      In studying the dinar you'll find many statements that say Iraq will revalue their currency, but upon closer examination you'll see that they're describing the redenomination process of exchanging currencies and removing zeros from the exchange rate. Now if you stick with the literal definition of revalue you'll assume that they're going to raise the purchasing power, but if you take the statement in the context of the history of economics and in comparison to other statements you'll draw a different conclusion.

      The history of redenominations and revaluations tells us that the currency reform plan of the CBI is a redenomination. No currency has ever revalued 100,000%. No currency has ever had new denominations printed to conduct a revaluation. No country has ever issued statements saying that they would remove zeros from their currency for a revaluation. Just like with hermeneutics you have to respect the role of precedence in interpretation. This is what was largely responsible for my epiphany two years ago when I discovered what deleting the zeros, redenomination, and revaluation really mean. I started the blog and began sharing what I had learned and my views were confirmed in September of 2012 when the federal indictment of Brad and Rudy made it very clear what the CBI's currency reform plan is.

      We all bought dinar hoping to make substantial profits. Nobody believed that Iraq was going to lop when they first invested. It's not a matter of believing in the lop because you want to. It's a matter of following the evidence. It's so strange to me that you talk about exegesis and eisegesis when in my mind you are the worst offender when it comes to reading your views into the articles. You have to ignore precedence. You have to ignore Shabibi's reference to Turkey as a model for Iraq's currency reform. You have to ignore Shabibi's numerous references to the need for a stable exchange rate. You have to ignore the fact that Iraq's money supply continues to soar while they are presumably preparing to raise the value and reduce the money supply. You have to ignore the fact that their numerous declarations to the Iraqi people that they are going to raise the purchasing power exponentially have resulted in a greater demand for US dollars rather than IQD. And you have to assume that the DOJ would prosecute a case for fraud knowing that any substantial revaluation or appreciation of the IQD would present the convicted with grounds to have the conviction overturned.

      I don't believe that the CBI's plan is a redenomination because I want to believe it. I hated coming to that conclusion. I wanted this to happen as much as anybody, but facts are facts. The IQD that investors hold will eventually be worthless if Iraq ever gets around to doing what they say they will do, and in the meantime it will in all likelihood hover around a tenth of a penny which will leave the vast majority of investors at a loss of at least 20% and possibly 100%. Hopefully this blog can serve as a wakeup call.

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    2. You have presented me with an admirable challenge. Thank you.

      The "history of economics" is interesting, but not necessarily relevant to the discussion at hand. Clearly, for a currency to go from $3.33 per dinar to 4000 dinars per dollar in a matter of a few years (late 80s to mid 90s) is an extremely unusual case.

      If you are open to another way of looking at the data we have, you will find that this is a unique situation.

      IMO, it is a stretch to make a statement like this: "The history of redenominations and revaluations tells us that the currency reform plan of the CBI is a redenomination."

      If the CBI itself makes statements that indicate that this is not "typical" then I would suggest that a suspension of your "looks like a duck, must be a duck" view is in order.

      Your statement that "the federal indictment of Brad and Rudy made it very clear what the CBI's currency reform plan is" has me baffled. These men were accused of a scam to advertise dinars for sale without delivering the product. I fail to see what this has to do with telling us what the CBI plan is. Perhaps you can enlighten me on this point.

      I suspected that I would be accused of being the one who uses eisegesis. You claim that I am the one reading into the articles because I "have to ignore precedence." The simple fact is that precedence may or may not be a factor here.

      Shabibi did NOT make a reference to Turkey "as a model for Iraq's currency reform" as you have stated.

      "Shabibi said there is a lot to learn about Turkey."

      http://www.azzaman.com/english/index.asp?fname=news\2011-07-15\kurd.htm

      Are you reading into this, or do you have other evidence that says that Shabibi's plan was to emulate what happened in Turkey?

      Here is what happened. Shabibi made an interesting comment during the Q and A at his visit to the US Chamber of Commerce in April 2012. After answering a question regarding revaluation of the IQD, a questioner apologized for asking the “same question,” and then asked about dropping the zeros from the currency. Shabibi corrected the questioner by responding that, no, it was “not the same question.” He then went on to explain that dropping the zeros was a different issue than revaluing the currency.
      This, and other releases by the CBI, make it clear that the CBI plans to redenominate the IQD to make transaction calculations easier on their citizens, just as Turkey did. It will release a new currency with lower denominations but without any change in the purchasing power of the citizens.

      So, how do we resolve this? Fortunately, the CBI has answered this for us.

      In August of 2008 a statement was issued:

      ”Finance Ministry has prepared a plan to increase the value of the dinar against the dollar and then delete the three zeroes from the dinar's value to contribute to the advancement of the Iraqi economy during the coming period.”

      http://translate.google.com/translate?hl=en&ie=UTF-8&sl=ar&tl=en&u=http://www.foratnews.com/paper.asp%3FID%3D8383&prev=_t&rurl=translate.google.com&twu=1

      Here we now were able to see that there is an order of events that will occur, with the raising of the value of the dinar coming first, and then the “delete the three zeros” afterwards.

      Therefore, a redenomination is clearly a part of the plan, but it will occur AFTER an increase in the value of the dinar based on CBI's own statements. The CBI is on record that the dinar must reach "about a dollar". After that, the redenomination will occur. I really don't know how you get around this one. The ball is now in your court.

      Enorrste

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    3. Yes, the history of economics is relevant if you're trying to understand the terminology. Deleting the zeros has always meant RD or lop. Read my post Deleting the Zeros and you'll see several examples of news articles just like Iraq's announcing the upcoming RD. http://dinardouchebags.blogspot.com/2012/06/deleting-zeros.html

      Actually it's not unique for a currency's value to tank in times of war and sanctions. But it is unprecedented for a currecy to appreciate in the same way that some have unfortunately nosedived. Countries can't always control depreciation, but they can and do control appreciation.

      Pertaining to Brad and Rudy - Maybe you should read the indictment. http://www.realscam.com/attachments/f12/1576d1348185792-bayshore-capital-investments-bh-group-bhgroup_indictment.pdf Points 7 & 8 on page 3 tell us that they misrepresented the RD as an RV. That's fraud.

      I couldn't get your link to work, but according to http://www.iraq-businessnews.com/2011/07/18/iraqs-central-bank-considers-new-currency/ your Shabibi quote was a tad off. He said there's "a lot for Iraq to learn from Turkey". "From" as in Turkey teaching them something, not "about" as in just reading about what happened. Shabibi stated that Turkey was successful so naturally he wants to follow successful examples like those of Turkey and Brazil which both conducted revenue neutral redenominations, not unprecedented millionaire creating revaluations. Turkey is right next door to Iraq. Turkey had been through hyperinflation just like Iraq. Turkey removed zeros from their currency after bringing inflation down below 10% just like Iraq has. There is nothing in that article to suggest that Shabibi's reference to Turkey is anything other than an attempt to follow their example, so following your practice of accepting the natural meaning I have to conclude that he was using Turkey's RD as a model.

      "Finance Ministry has prepared a plan to increase the value of the dinar against the dollar and then delete the three zeroes from the dinar's value to contribute to the advancement of the Iraqi economy during the coming period."

      So it appears that you're deriving your view from the insertion of the word "then", concluding that it is a reference to chronology. Leaving the word "then" out everything in that statement is perfectly consistent with the hitorical approach to redenomination, as well as the innumerable statements and articles explaining their currency reform plan. Considering that this is a translation from Arabic I wouldn't feel too comfortable risking my hard earned money on an Arabish translation that might somehow suggest an unprecedented revaluation is about to occur. I'll go with the preponderance of the evidence that they're talking about a textbook redenomination here.

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    4. I read your blog from 2012 and see that you presented your case well. The examples you site are clear examples of redenomination involving the "removal of zeros." Articles on the net, however, refer to hyperinflation as the "reason" for redenominating. The fact is that Shabibi took over and reduced inflation from triple digit to one digit in a matter of a few years and held it there for several more. It is still under control. So, the question is this: why redenominate at all? Clearly, there must be some other reason for the delay.

      With regard to the Brad and Rudy issue, suffice it to say that the lawyers who wrote the indictment were coached how to write up the indictment. This indictment does not prove a thing. It is only a position statement. It is convenient for you to mention it because you agree with it, not because it is the CBI position.

      Often in Arab to English translations we have found that the adjectives such as "from", "about", "of", "in", etc. are "dropped in" by the translator to enhance understanding, when in fact the word itself is not there. I would not give much credence, therefore, to your supposition that "from" is the correct meaning, let alone that in doing so you can "infer" that this means that Turkey is somehow teaching Iraq what to do. Shabibi never stated that in any sense. In fact, I have already shown that his use was specific in its reference to the value of a redenomination, but only after a revaluation. Your view flies in the face of the CBI statement regarding a RAISE in the value of the dinar. A redenomination is revenue neutral. Therefore you must deal with the clear RAISE IN VALUE statements in order to proceed logically, in my view.

      With regard to the "then" in the article about revaluation followed by redenomination, I certainly respect your attempt to obfuscate the issue here, since otherwise you are placed in a conundrum. In an effort to be as accurate as possible I was able to find the original Arabic and sent it to my friend of 25 years for a translation directly from one who reads Arabic fluently. He confirmed that the word "then” is the correct interpretation of the Arabic. He said that the word is clearly there.

      Having said that, however, your ability to "summarily" remove the word so that you can then justify your position ("everything in that statement is perfectly consistent with the historical approach to redenomination") is a clear case of eisegesis. You have no RIGHT to remove a word to support your point of view, just as I would have no RIGHT to include a word in order to prove another. It is just not a correct way to proceed, if you don't mind my saying so. This article is really easy to read. Therefore we have no right to just arbitrarily remove a word in order to justify our preconceived idea. Doesn't that make sense?

      Here is the point: you MUST remove the word in order to support your view. I don't have to do that. If the plain sense makes sense, why look for another sense?

      I attempt, sometimes more easily than with others, to fit it into a bigger picture that makes sense. That is how I have come to understand revaluation first, and redenomination (change of currency) second. It all fits. What else can I say? I didn't have to change anything. You, on the other hand, must do just that.

      Incidentally, my view is also consistent with the "innumerable statements" that you refer to. I just come to a different conclusion than you do, without removing a word.

      Enorrste

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    5. Thanks for the kind words. I do my best.

      Why redenominate? To remove the zeros which are the result of past hyperinflation. If you're suggesting that countries only redenominate to try and stop inflation you're wrong. Turkey's inflation was already under control when they lopped in 2005. Why did they redenominate? To remove the effects of previous hyperinflation, not to stop hyperinflation. The same situation that Iraq is in today. The reason for the delay has been stated many times - stability, security, money laundering ... etc. Those were conditions that Turkey didn't have to deal with in 2005.

      Maybe I agree with what's in the indictment because it's right. Maybe you reject what they said because it doesn't agree with your position. Did you ever consider that? The reason they stated the CBI's position that way is because THAT IS the CBI's position. You don't think people in the DOJ can consult with the State Dept and the US Treasury to get the scoop on this stuff? Attorneys don't like to try cases they can't win or that might be overturned. If they felt that there was any possibility that Iraq's currency could go up enough in value to make anybody rich they could have left this out of the indictment and just charged these guys on the other 80+ counts. By the way, Rudy pled guilty to fraud. He didn't contest their version of the currency reform plan.

      The Shabibi quote about learning a lot from Turkey was written in English. Maybe it was translated from Arabic, I don't know. But the context still shows that Shabibi referred to Turkey's redenomination as a success that they had looked at in determining how to proceed with Iraq's redenomination. I can't see how any honest person can interpret this otherwise.

      Your article with the reference to "then" was obviously cherry picked to support your viewpoint, and it would be contradictory to the mountain of articles and statements and the indictment that indicate otherwise. If it was consistent with that evidence I'd find that word less questionable. Or maybe if it wasn't tranlated from Arabic. Again ... eisegesis. What you're doing here is no different from denominations that take one verse out of context and build a new theology around it. But let's just say for the sake of argument that you're right. Let's say that they intend to raise the value prior to redenomination. That doesn't mean they're going to raise the value up to $1 before they RD. Revaluations are small adjustments. It's entirely possible that they will raise the value 16% to $.001 and then remove the zeros from the 1000:1 exchange rate which would give the dinar parity with the USD. That would make a lot more sense than defying the laws of economics and everything we know about currency valuation by going from a tenth of a penny to a dollar and wrecking their economy in the process, wouldn't it? Unfortunately a 16% increase wouldn't be enough to cover the spread for the vast majority of dinar investors.

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    6. Here is how Investopedia defines redenomination:

      1. The process whereby a country's currency is recalibrated due to significant inflation and currency devaluation. Certain currencies have been redenominated a number of times over the last century for various reasons.

      The phrase "various reasons" is obviously there, so in that sense you can be correct. However, most redenominations occur due to inflation, either chronic or hyperinflation, according to articles on the net.

      I agree with you that the Iraqi situation is not driven by hyperinflation, as well as the reasons for the delay.

      The fact that Rudy plead guilty says nothing about the totality of the allegations made against him. According to you he plead guilty to fraud. That says nothing of the CBI plan one way or another, in itself. I am not afraid to see the "other side of the coin," so to speak. In the Rudy case, however, it isn't in any sense "official". As I said earlier, it is a "position document" that obviously worked, since the guy plead out.

      Shabibi obviously learned a good deal about what happened in Turkey since he referenced it in his speech. But it is difficult for me to leap, as you do, to a statement that Shabibi wants to do the same thing that Turkey did. If he really felt that way, why didn't he just say so? Instead, he said there are things to learn from the Turkish experience. I really don't think we can parse this any farther than that.

      The "then" article just came through the normal day-to-day research done by the mods on KAP's site. I didn't cherry pick it at all. However, once it showed up, it confirmed what we had concluded, as I noted earlier.

      I fully agree with you that the RD could come at any time. However, I just posted for Brian this simple statement: if the rise were only 3 pips per trading day (260 trading days in a year), then in 2 years (the time Saleh said it would take to remove the three zeros), the dinar would be over $1. There is nothing shocking about this rate. In fact, it is quite normal. Therefore I believe them when they say "raise the value and THEN remove the large notes". The removing of the large notes is a "redenomination" in the sense that they will change currencies, but not a LOP in the sense that 25000 dinars overnight becomes 25 dinars and both hold the same value. The process will be very gradual and the large notes will become more and more risky to carry as their value as "legal tender" (Saleh's words) increases. They will be deposited in banks and the CBI will destroy them. In time (2 years or so), the money supply will fall to 33 billion dinars worth about $33 billion. That is what they say. Who am I to argue with them?

      I am honestly not aware of a "mountain of articles and statements" that indicate that a LOP is in the cards (using redenomination to mean LOP here). If you can direct me to some I'd welcome the opportunity to read them. I know that the term redenomination is used frequently, and that "revaluation" is used less frequently. But with a free float on the plate now we expected the term revaluation (RV) to slip into the background.

      The question is the meaning of redenomination in the articles in which it is found. If it can be clearly shown to mean LOP, I'd love to see it. My experience is that "change of currency" is usually what is intended when the term is used. We know that they will, in fact "change the currency" in 2014. Hence, the delay in "remove the three zeros" to 2014. And, by analogy, the "redenomination" is set back to 2014. All of these refer to the same process, in my opinion.

      I welcome reviewing any LOP articles you find, or have on file.

      Enorrste

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  22. Sonny, it's simple math. Iraq has an M2 of over 75 trillion dinar. This isn't opinion. It is disclosed and published by the CBI. Iraq has a GDP of less than 200 billion dollars. It isn't opinion. It's published by multiple sources including the CIA. Iraq cannot RV the dinar to even 1 cent. It is a mathematical certainty. A small nation like Iraq cannot possibly support a money supply that is valued higher than it's GDP. No nation can. The GDP of the US is nearly 17 trillion dollars yet our M2 is only about 10 trillion dollars. A nation like Iraq with a GDP of about 150 billion dollars can probably support a money supply of approximately 70 to 80 billion dollars (which, amazingly, is right about where it is now). As their GDP grows they could conceivably support a higher value for the dinar but, so far, they've chosen to expand their money supply. If they grow 7% a year for about 20 years and don't increase their money supply (or steal the growth through fraud, corruption or graft) they could support a dinar valued at a penny or so. Obviously, that is not going to happen. I think it is obvious that the CBI is comfortable with the current exchange rate and considers it important to keep the value stable (and sustainable). Iraqi leaders may not be nearly as stupid as many of the clowns like to infer.

    A redenomination will indeed "raise" the value of the dinar but, as we have explained, ad nauseum, it will have no effect on purchasing power. Thousands of currencies have been redenominated throughout history. It is not unusual or unprecedented. One Turkish lira is far more valuable than a Turkish lira of 10 years ago but, as we all know, "raising" the value of the lira (through a redenomination) did not increase or raise the purchasing power of the Turkish citizen because the number of lira owned by citizens was reduced and corresponding prices of goods was changed accordingly. But in a technical sense, the value of the lira was "raised". There is no specific timetable for it. There is no particular urgency. In fact, they may not redenominate at all. If they decide to make any changes to their currency, it will be a redenomination. It is the only possible thing they can do. I have no idea if they still plan to or not. I don't really care except that it may finally expose the clowns as the lying douchebags they are. Until then, clowns like you will be able state unequivocally that an RD is just not possible and get away with it.

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    1. Networth, please see my comments above in which I explain clearly that only you and Brian are talking in terms of M2. The rest of the world only talks in terms of M1. If you insist on talking about M2, then why isn't anyone concerned about the fact that M2 is 5 TIMES the GDP of America? Obviously, the answer is that they don't talk that way. Therefore, as I suggested to Brian, why don't we all talk on the same level. The US talks only M1. The CBI talks only M1. They say the money supply is 33 trillion dinars. Why can't you accept that?
      Furthermore, you go on to talk about the "affordability" issue, which I also addressed above. The CBI itself has stated numerous times in public that the process will involve lowering the money supply from 33 trillion dinars to 25 billion dinars. Once that occurs, and it will be a process, they will have $70 billion in reserves to cover 25 billion dinars, or almost 300% coverage of their money. The US has only 15% coverage of its money and is considered the "strongest" currency in the world. Iraq has made statements that its currency will be the strongest in the world. Given their own statements of how they will get to that position, why not just accept what they say?

      The attempt to change the meaning of "raise the value" of the dinar to what you want it to mean, rather than what it means by and of itself in context, is a case of eisegesis, which I explained above to Dave, or someone. Instead of allowing an article to give its own meaning through context you are reading into the article a preconceived idea (LOP) of your own and overlaying it onto the clear an obvious meaning in the article itself.

      In Biblical exegesis (as opposed to eisegesis) we say this: If the plain sense, makes sense, then don't look for another sense.

      If you all would attempt to set aside your preconceived views and allow the clear and obvious meaning to come forward, you would be surprised what you would learn. However, as long as you have blinders on, you will continue to "read into" the articles a preconceived idea.

      Now, I'm sure you are thinking this: what if You, Enorrste, are the one who is reading into the articles? That's a fair complaint. What I would respond is this: let's look at the articles, one by one, and see who is correct? Obviously, as Sonny1 has said, the RV articles outweigh the RD articles 5 to 1. But I have an open mind. Let's bring them up, one by one, with links, to show context, and debate.

      Honestly, saying that "raise the value" means "no change in purchasing power" is really a stretch. But there is a simple way to understand each of these without equating them to one another. In a free float, there will, initially, be no change in purchasing power. Furthermore, any change in purchasing power within Iraq will occur only in imports, which will become cheaper as the dinar "raises in value." Over time, goods will become less expensive and there will be an economic (as opposed to an "exchange rate change") change in purchasing power. The change in purchasing power within Iraq will take time. Just as we don't immediately see a change in "purchasing power" in America with the day to day change in the value of the dollar, the same will happen in Iraq with a free float. However, just as we, in America DO see a change in purchasing power, downward, as the dollar has lost value in the world economy, so too will Iraq see a change in purchasing power (upward) as imports become less and less expensive. This is what is called Economics 101.

      Enorrste

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    2. The CBI publishes a table on their website. It's plain as day for anyone to read. Sam has linked to it several times. It states that at the end of December, 2012, their M2 was 78 trillion dinar. It seems weird that a guy that researched the dinar for 7 years would never visit the CBIs website and know this. Maybe you don't consider it a credible source. LOL! M2 measures the total supply of money and includes electronic deposits (not cash) in banks. It is the proper measure of a nation's money supply. Their money held outside of banks (hard currency) was about 33 trillion dinar. The US, by contrast, has an M2 of approximately 10 trillion dollars. This number is published by the federal reserve (perhaps another unreliable source) but can be widely searched from different sources. Sorry to burst your bubble but our M2 is nowhere near 5 times our GDP. As I said earlier, it is not possible. Any nation with such an inflated money supply would experience runaway hyperinflation and a complete collapse of their currency. But I'm sure as an in depth researcher you already knew that and just misspoke. If you make up numbers that fit your template (which seems to be a common practice of the clowns) then you can justify any scenario you want, I suppose. You may want to hone your researching prowess. While your at it, tell us how many times in history a currency has ever revalued by 1,000%. Or even 100%. Or even 50%. Ever. I'm sure with 7 years of sleuthing you have that info at your fingertips. In the meantime, have fun spending all your imaginary money!

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    3. Once again you have failed to read my response before shooting back. First, I made the point that only you and Brian talk about M2. That is a fact.
      Second, I made the point that it DOES NOT MATTER what the current money supply is, because the CBI has stated many times that they are planning to reduce the money supply to 25 billion dinars. What about that did you miss?
      I also talked about the "affordability" issue as meaningless due to the fact that the CBI is planning to reduce the money supply to 25 billion dinars.
      Do you have a problem keeping up?
      All of your bloviating (I love that word) has NOTHING to do with the stated position of the CBI. You are stabbing at shadows that do not exist. Stop talking about M2, on the one hand, and about affordability, on the other. With a projected money supply as stated clearly by the CBI of 25 billion dinars AFTER the revaluation and AFTER the removal of the large denominated notes, they will have almost 300% coverage of their currency, way more than any country in the world.
      Please, just stick with the facts. The CBI is the source, not your bloviating. If you follow what THEY say you will get it. If not, keep stabbing at your shadows.

      I don't usually get so direct, but you clearly aren't following the thread here. If you insist on presenting your own arguments, then fight the CBI. I only quote them. You, on the other hand "redefine" the standard money supply and then FAIL to take into account the CBI's own statements of their intentions in order to make a point that they can't afford it!
      Stabbing at windmills. Strawman argument.
      Deal with their own statements and we can discuss this. Otherwise, enjoy the wind you are creating. NO ONE HAS PRESENTED THE CASE YOU ARE RAILING AGAINST!

      Enorrste

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    4. For a man with a supposed "degree in economics" you sound unbelievably confused Steve / Enorrste / whatever other aliases you shill under.

      Iraq has 33tn in banknotes (M0) and 78tn in bank notes + bank accounts (M2). Both will be lopped as the CBI, Iraqi Finance Committee, SIGIR, etc, have repeatedly said. Iraq has barely $65bn currency reserves which is 500x less than their total banknote circulation and 1,200x less than all Dinar in circulation (and 639x more money created than the size of their entire economy). Either way, they will lop (as they've said over and over and over), and 33tn / 78tn will become 33bn / 78bn - more in line with their currency reserves. It's really not that hard to understand.

      As for your laughable claim Iraq doesn't use M2, I can only suggest you open your eyes and educate yourself on the CBI usage of M2 starting with their very own reports on their very own website...

      "Broad Money Supply (M2) : 78.465tn Dinar as of Q1 2013"
      http://cbi.iq/documents/Monetary_Aggregates_f.xls

      The ultimate in credibility destroying...

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    5. The fact that M2 shows on their reports, just as it does on our Fed reports, does not mean that is in used in "normal parlance" as I have already shown. People talk about the "money supply" in America as being $2.5 trillion, not $10 trillion. Say what you will, that is the fact. Similarly, I have NEVER seen an article in which the CBI referred to a money supply in an PUBLIC ARTICLE as 78 trillion dinars, but I HAVE seen numerous articles in which they refer to the money supply from 25 trillion, in the past, to 33 trillion now. Why can't you just accept that you are the "odd man out" on this issue.

      Furthermore, it matters NOT ONE BIT whether the money supply is 33 trillion or 78 trillion dinars, because the CBI has stated its intention to reduce that to 25 billion dinars. Why do you consistently leave this out of the conversation? I can tell you why: it does not fit your pre-conceived idea, and to include it would mean you would have to drop your argument entirely.

      You see, if the CBI withdraws the large notes AFTER revaluing the currency, as I have stated and they have stated, then the redenomination (change of currency) will reduce the money supply by removing the large notes from circulation. Once it gets down to 25 billion dinars your arguments about "affordability" become moot points. At 25 billion dinars they will have almost 300% coverage of their money supply, as I have noted several times tonight.

      Of course you can't allow that to come into play, can you, even though the CBI has stated it? To do so would ruin your viewpoint entirely, and that is unacceptable. As my father used to say to me, jokingly: "Don't confuse me with the facts! My mind is already made up!"

      Enorrste

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    6. Yet again Steve, all you're doing is twisting semantics to avoid addressing the facts then arguing against your own projections whilst trying to pretend you aren't. You claimed the CBI doesn't use M2 - and yet it's right there in their own reports. So you lied. You then claimed M2 for Iraq "doesn't really mean money supply". The truth is as usual the exact opposite of your false claims : In the CBI's Key Financial Indicators Documention PDF, M2 is clearly labeled "Money Supply" and M0 is simply labeled "currency outside banks". M1 isn't listed at all as a measurement. If you're going to argue something, then argue about arguing, at least get your own facts straight as to what the CBI are actually saying in their own reports or what the Iraqi definition of Money Supply is.

      For the record, I agree it's irrelevant as "deleting 3 zeroes" simply means the M0/M2 figure will be 3-zeroes less of whatever it is on the day of the lop as the CBI have stated. Only deluded Dinaraholics & guru's obsessed about "ME AND MY BANKNOTES" believe M0/M1 is all that matters because it never enters their head that half of all Dinar is in bank accounts which will also get lopped, as will Dinar-priced stocks on the ISX, bonds, accounting systems, billing systems, ATM's, etc. The whole lot has to be done or else a grocery bill will end up $50k or $50 depending on whether they pay by cash or cheque, which is just more deluded pumper junk economics nonsense and would result in the catastrophic collapse in trust in the Dinar as a medium of exchange overnight...

      If you have a 25,000 Dinar note and paid another 25,000 Dinar note into a Iraqi bank account, both will get lopped at the same rate and both will have the same post-redenominated value (25 Dinar). You aren't going to make $21,500 out of a $21.50 USD valued currency note because you won't be changing them back 1:1 (because that would just mean swapping 31tn M0 notes for 31tn M0 notes with a different banknote design, and the value of the currency won't be going anywhere because the money supply doesn't get reduced).

      A Dinar banknote will have exactly the same value whether it's a paper banknote, in a checking account (M1) or in a deposit account (M2) no matter how much you desperately want to believe that your's are "special magic beans". Likewise a redenominated 25,000 Dinar note (25 Dinar) will continue to be worth 50x more than a redenominated 500 Dinar note (500 Fils coin) - not 50,000x. Your arguments over M1 vs M2 are irrelevant as every Dinar in circulation will be redenominated together at same rate. For a man with a supposed degree in economics it's almost embarrassing to have to explain why cash held in a bank account is still "money" that's part of the money supply.


      Steve - "but I HAVE seen numerous articles in which they refer to the money supply from 25 trillion."

      Yes I've seen them too back from 2010 reports back when they're M0 was 25tn. Since then M0 has gone from 25tn (2010) to 33tn (2013), and M2 from 60tn (2010) to 78tn (2013), so when they lop it will end up 33bn / 78bn instead of 33tn / 78tn. You do realize Iraq's money supply has gone up every year right, and your three year old figures are no longer accurate, right? I mean, with your grand degree in economics, you do understand that Iraq is continuing to print more money each year right?

      Delete
    7. I did not lie. I know that M2 exists. My point, which you continue to miss, is that M2 is not openly discussed in public. Of course it exists, just as it does all over the world. It is not a lie to say that it isn't generally used in PUBLIC documents. That is a simply fact. Once again, you create a shadow (which I never intended), then attack me personally as a liar for something I never said. My writings are clear: Shabibi and Turki NEVER talk about M2. Instead they talk about M1. That is my point and it is a simple fact.

      Fortunately you now also admit that this talk of M1 and M2 (current) is irrelevant. Thank you, finally.

      However, you then, once again, create a shadow that does not exist in reality. You make the statement that I must be ignorant about the level of even M1. I know that the money supply has risen from 15 trillion dinars to over 33 trillion dinars. A few years ago it was about 25 trillion, and that was when Saleh stated the plan to reduce it to 25 billion. A more recent article I came across this morning specifically states that it will now go from 33 trillion to 33 billion. Once again, however, instead of dealing with the POINT I am making you attempt to impune my intelligence with these simple "shadows."

      I have a suggestion: how about we stick to the issue? Is that too much to ask? Your ad hominem attacks only betray the fact that you can't, or won't, deal with the issue at hand.

      That issue is clear: the money supply will be drastically reduced. That being said, the "affordability" issue will be removed from the discussion because the dinar will become the "strongest" (not highest in value) currency in the world ("best backed") Could we, then, finally, move on?

      This leaves only the core issue: redenomination, revaluation, or both. You opt for the first, while I have shown that the plan is the third. Show me how you explain articles that clearly talk about an "increase in the value" of the dinar. I have no problem with changing out the currency (redenomination). But I have a big problem with LOPping, which is what you espouse.

      If you could address, without hyperbole or ad hominem attacks, just how you became convinced that a LOP is the plan instead of a revaluation and then a redenomination (change of currency), I would gladly read it, study it, and address it.

      However, no one has yet made that presentation. Instead, all I get is "everyone knows that it will redenominate." First of all, I and many others are part of "everyone", so you are mistaken. But more importantly, you bring nothing to the table in making that sort of statement (or someone else on this forum). Why not just offer me a good article that clearly states that the redenomination will take place first, and that the value of the dinar will rise thereafter. Or give me an article that says that the "remove the three zeros process" is specifically a LOP. I'm open. Ball is in your court, again.

      Enorrste

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    8. Steve - "Show me how you explain articles that clearly talk about an "increase in the value" of the dinar."

      When you lop a currency, it tends to get traded more as confidence increases and Dollarization reduces, which causes a slight 1-5% increase in value. This is not an "RV" and only you are frantically scribbling out inconvenient quotes that state the obvious, and crayoning in "Go RV!" every time you read "increase in value". This is your endless straw-man - assuming increase in value means a massive 99,000% peg adjustment - it does not and never has done...

      Steve - "If you could address, without hyperbole or ad hominem attacks, just how you became convinced that a LOP is the plan instead of a revaluation and then a redenomination (change of currency), I would gladly read it, study it, and address it."

      No you won't because I've already done that and as Sam (and others) have said, you repeatedly ignore anything that doesn't fit your huge sense of entitlement, and pass off your own misinterpretations of mistranslations as "original sources", even when they end up saying the opposite of the original source said in other statements.

      The CBI have said they're going to lop - about 26 times in a row now. It has been in official statements, both English & Arabic, broadcast on TV, printed in newspaper, etc, but as usual, whenever you're presented with this your mind is trained to filter out anything that doesn't involve a silly $1m for $1k promise.

      No matter how much proof of Iraq's redenomination is given you will not see it even it were superglued to your nose purely becaues despite your claims of "open-mindedness", you've already demonstrated the beginning and end of your argument is to rewrite quotes to mean what you want them to mean and either ignore everything you don't want to hear or rewrite it as some form of comfort blanket that tells you only what you want to hear.

      Delete
    9. I went back and re-read all of the quotes that you refer to in the blue comment above.

      The term redenomination could mean one of two things:

      1) It could refer to a LOP (your position)
      2) It could refer to a change from one currency to another (my position)

      The CBI has stated that the redenomination has been set back to 2014, at which time the new currency will be issued in exchange for the current NID.
      The CBI has also stated that the "project to remove the three zeros" has been postponed to 2014 as well.

      Therefore, it seems clear to me that these three things refer to the same thing (redenomination, change out the currency, and remove the three zeros).

      Of these, only the first and third could be understood to refer to a LOP.

      Given the process as I understand the CBI has laid it out, by the time that they "remove the three zeros" the value of the dinar will have risen to make that not only practical but almost essential. In addition, however, as the value of the dinar rises, it will be necessary to issue existing small denominated NID that were printed in 2003 (Saleh stated that they would do this, incidentally, prior to the final removal of the NID completely). In other words the small denoms would hold an interim role prior to the "redenomination", as I understand it, which would be the changing to the new currency with 3 languages. In none of this can I see a LOP described. I'm not saying it couldn't happen, but only that the process does not seem to require it. A movement of 3 pips per day is nothing. The results, however, agree with what Saleh has indicated will happen.

      In my opinion, a LOP, if it were to occur, would have to initiate the process rather than come along somewhere later. If the goal is to get "3 zeros" removed, then they would have to do the LOP at or around 1000:1 as the value of the dinar rises. This is certainly possible, but it would beg the question as to why they would then take 2 years to roll out a process that essentially would happen on the day it pipped to 1000:1. It would also lead into question why the "project to remove the 3 zeros" (here being used as a LOP) would not begin until 2014 at the earliest. I suspect the answer would be that nothing would occur until next year, which is certainly possible.

      If that were to occur (a LOP at 1000:1) then investors would not gain much unless the dinar eventually rose to $3 or more (they would then triple their money, roughly).

      Time will tell whether you are correct or not. I still believe that the plan is as I have stated it, but I am not as "hard headed" as you make me out to be. We'll see what happens.

      Thank you for a spirited discussion. I believe I have been allowed to present my case, and you have vigorously defended yours as well. Through this post you can see that we may both be correct, or one may be more correct than the other. In any case, we won't resolve this unless and until a float or LOP occurs. Even if the float does occur, you may still be proven right at about 1000:1. I doubt it, but I'm not blind to the possibility.

      Enorrste

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    10. Steve -"The term redenomination could mean one of two things"

      No Steve, "Redenomination" means one thing and only one thing - a LOP - as is demonstrated in every single one of the dozens of countries it's been done in the past and every single non-pumper site on Earth:-

      "Redenomination is the process of changing the face value of banknotes or coins used in circulating currency... A new unit replaces the old unit with a fixed number of old units being converted to 1 new unit, and the procedure can be referred to as "cutting zeroes""
      https://en.wikipedia.org/wiki/Redenomination

      Investopedia explains 'Redenomination' : "For example, the Bulgarian lev was redenominated due to inflation arising at the end of the Second World War. After the redenomination, one "new" lev was equal to 100 "old" levs."

      "Currency redenomination occurs when a government uses a single currency unit to replace a fixed number of old units. In other words, altering the face value of a currency without changing its foreign exchange rate is redenomination."
      http://www.financial-planning-techniques.com/Currency-Redenomination.html

      Currency Redenomination in Developing Nations:-
      http://www.unc.edu/~lmosley/APSA%202005.pdf

      FUNDAMENTAL ASPECTS OF CURRENCY REDENOMINATION:-
      http://200.74.197.143/englishversion/pdf/fundamentalscurrencyredenomination.pdf

      "Redenomination - A reduction in the face value of a currency that a government or central bank makes because of hyperinflation or chronic weakness as a currency. For example, a country may declare that a "new" dollar is worth 1,000 "old" dollars and print new denominations reflecting this change".
      http://financial-dictionary.thefreedictionary.com/Redenominations

      ISO 4217 Redenominated Currency Codes:-
      http://www.commondatahub.com/live/geography/currency/country_currency_codes


      Redenominations are nothing new, there's been literally dozens upon dozens of them on every continent on Earth over the past 200 years - only deluded Dinar "RV" conmen try and twist the well known & universally accepted definitions around (and solely for Iraq which unsurprisingly just so happens to be the country they're pumping the sale of banknotes of...). I think we can all figure out what a currency redenomination is without having to pass it through your heavily biased & flawed "The One True Pumper Word Redefinition Machine"...

      You pumpers spent YEARS saying "there will be no redenomination" all the time, over and over when the CBI was quiet & vague during 2003-2009-ish, - now that Iraq have issued so many statements openly stating they'll redenominate over the past 3 years and describing their LOP in detail, all you're left with to try and retain some vague semblance of credibility amongst your devout "flock" is to try and declare "Well OK they WILL redenominate, but a redenomination isn't a redenomination because I say so", which gets repeated so often you've ended up believing your own propaganda... It's yet more juvenile word games no different to "No, officer, I didn't steal his wallet, I merely 'involuntarily relocated' it"...

      Delete
  23. Networth, thanks for the clown dig at the end, it makes you look like a fool to call people names.
    Now I am going to curl up in a ball and cry.....

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    1. Unfortunately, I don't suffer fools patiently or gladly. Consider it one of my flaws.

      Delete
  24. Well DaveD and Sam have really said it all and done a great job doing it.

    Anyone who believes that Iraq has been for years preannouncing a 100,000% to 300,000% RV should have their head examined. It's so obvious that a LOP is what they are speaking of its pathetic. 1000 to 1 exchange, like Turkey, will not increase purchasing power, simplify transactions, trillions to billions. Duh.....common freakin sense alone is all it takes. 7 years Steve? LOL In 7 days I learned of how RDs worked and knew I had probably been duped. Sonny.....really? How long have you been in this thing and you still haven't figured out RVs are fantasy? Show us one. Currency values don't jump by 1000s of percent unless they are on a downward spiral.

    Steve.....I would love a link to the CBI "economist" stating that a 1000 dinar note will buy 1000 packs of cigs after the "RV". If he said it then it was a bad translation or he was hoping to sell more dinar to suckers in America.

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    1. I have a personal friend who was born in Jordan but has lived in the US since 1967. He speaks and reads Arabic fluently. He does not own any dinar. He translated the article for me. I have known this man for over 25 years and worked with him twice (in commodities and also as an assistant to a bankruptcy attorney). His integrity is without question. His mother, who is 89, also obviously speaks and reads Arabic (she was born in Syria). She considers me one of her sons.

      Here is the first link, which can be translated to English by Google:

      http://www.ikhnews.com/index.php?page=article&id=34445

      The author is A. M. D. Jawad Kazem al-Bakri. He is on the Administration and Economics staff at the University of Babylon. Dr. Kazem Jawad Al Bakri teaches in the Department of Finance at the University of Babylon and is a well-respected Economist. He was hired by the CBI to participate in the various Symposiums around Iraq educating in regard to the “delete 3 zeros,” also known as “lift 3 zeros” process.

      Here is the article requested:

      http://www.uobabylon...رفع الاصفار.pdf

      “The history of modern economics tells us that many nations in the world such as the countries involved in WW1 and WW2 or most recently the collapse of the Eastern Bloc countries, have taken one of these two measures, either by changing the whole national currency or eliminating zeros from the currencies so that it can go back to its previous stable condition.
      “In the Iraqi experience after the fall of the dictatorial regime, the present authorities have decided to change the Iraqi currency to a new currency.
      “This does not affect the value of the dinar so far but it opens the dinar to the free currency market such as against the dollar, etc.
      “If three zeros were lifted from the IQD this means the IQD becomes stronger 1000 times in terms of value.
      “For example, a pack of cigarettes that was selling for 1000 dinar would be only 1 dinar. If it was a conversion like that, if the three zeros were lifted from the previous currency, this means the old 1000 dinars will buy 1000 packs of cigarettes instead of 1.
      “From a theoretical point of view, when three zeros are lifted from the IQD its buying power will increase drastically so that the dollar will be equivalent to 1.5 dinars only.
      “Therefore, let’s say the merchandise imported from abroad is valued before lifting the zeros at 1.2 million dinars, or $1000; if you lift the three zeros 1200 dinars will equal $1000; therefore, that will not bring any negative impact on the Iraqi citizens.
      “On the positive of lifting the zeros from the IQD, the operation of lifting three zeros from the IQD, according to a study and sound physical policy, will lead to these positive factors:
      One, it increases the monetary power of the IQD to buy things.
      Two, it increases the value of exchange from the dinar to other currencies.
      Three, it provides more confidence for more foreign investment in the economy.
      Four, in increases the confidence of the Iraqi citizen in his own currency, as is the case with the dollar and other currencies in their own countries.”

      The article is written in Arabic and translated by my personal friend. I have no reason to doubt that the translation is accurate. However, if you have a translator that tells me otherwise, then I will consider this a “serious” joke on me by one of my best friends.

      Enorrste

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    2. Dinarck, I have answered your post with sincerity. I would suggest, respectfully, that you tone down your rhetoric and deal more in facts, rather than just putting down people as you have done. I do my homework. I have a great education. I am not stupid. I have never "pumped" dinar to anyone. I don't make up stories. I believe you owe me the respect that I have given you by my previous response. Tone it down, please. If you disagree, show me why. Otherwise, your statements are like "blowing in the wind." You offer nothing, no proof of your statements. It is as if you really believe that what you "know" is so obvious that every intelligent person should agree with you. Do you realize how silly that is?
      Please, just step back, and then back up what you say with something. That is what I do. I don't have to apologize for what I write because I back it up, every time, with a statement from the CBI or their representative.
      NO ONE on this site has met my challenge. SamIAm has tried, as has Brian, but I have shown them both to be sincerely mistaken in their point of view.
      There will be an increase in value of the dinar followed by a redenomination to a new currency. The CBI has said so, including the order of events. I don't make it up. I just posted their statement. As I've said to the others, if you disagree, that is your right, but please have the decency to back up your calumnous statements. Don't attack me; attack the CBI. THEY are the ones who put out the announcements!

      Enorrste

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    3. Damn, the arrogance which you show. Now I know why you and Kap get along so well. Just because you think people should show you respect doesn't mean you will get it. Just because you think you are smarter than everyone, doesn't mean you are. You put out some challenge for people to discuss this with you and they have. In fact go back and answer some of the questions you chose to ignore because you can't talk in circles to make it sound good. You say Brian and Sam have tried to accept your challenge but, and intentionaly I'm sure, you made it sound like they haven't presented a case and are wrong. This whole site proves their points. You back up your points with articles which you interpret. Since you already think you are right and everyone else is wrong, your challenge is pointless. It just gives you an avenue to try and over inflate your already over inflated ego.

      Delete
    4. You have no right to call what I am doing "arrogant." You don't even know me. I never asked anyone to respect me. What I did do was respectfully ask that we stay on point instead of rattling off "talking points" without justification behind them. I couldn't care less what you think of me personally. You do not know me.
      Similarly, I never said I was smarter than anyone else. I merely stated my credentials. What you thought of that is your business. If it threatened you in some manner, so what? I simply stated the facts. Do what you will with them. Many people would have read into that the simple fact that I just MIGHT know what I'm talking about. Instead, you take the ad hominem route (in other words, attack the "man" rather than the issue at hand). It is a common debating technique, but most people see through it quickly, especially when they are "called out" for doing so.
      I have not talked in circles. I have spent the entire evening going through this thread and have answered every single post directed toward me. Sorry, you are mistaken.
      Brian and Sam did present some good points, but they were also called out by me when they were incorrect. That is what a debate is all about. If this whole site proved only their points then I wouldn't be here, would I? The fact is that I have offered a number of points for you all to chew on. You don't like them, of course, and many will throw them out summarily. That is certainly your right. But the simple fact is that none of you, other than Brian and Sam, have even attempted to deal with the specifics that I have brought up. You, in particular, have added nothing whatsoever to the discussion. All you have done is "rail" against me. Who gives a hoot about your "railings"? After all, if you had CONTRIBUTED it would be one thing, but you haven't. Enough said.
      Notice that I did not attack you personally. I only stated that you are not adding anything to the conversation. I did not belittle you as a person, or call you arrogant, or ignorant, or use any other term directed at YOU personally. Get it?

      Enorrste

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    5. I don't need to know you to say what I said. Anyone who reads anything you write will see the arrogance oozing forth. Likewise you don't have to actually say you are smarter than anyone to project that in your writings, which you do as well. Call a spade a spade. Don't like it, I don't care, but I am still going to say it. You son are absolutely no threat to me. Don't flatter yourself. As far as your credentials go, they obviously haven't helped you in this investment which leads to believe you are lying and your credentials are non existant. Or you have them but choose not to use them or forgot what you learned. In any case they aren't helping. You better stick to trying to convince the newbies on your site.

      I have stated before, you are here as a platform to exercise your ego. You have really said only a few things for as long winded as the posts are. You keep saying the same thing in different ways and talking in circles to make it appear you know what you are talking about. You also have a really bad way of trying to be a smart ass. You can't pull it off. Which tells me you have no sense of humor. That and you actually answered my post at the bottom of this page.

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    6. You seem to be upset, which is unfortunate. I was only trying to communicate the plan as I see it.

      There is a difference between implying something and inferring something. What you are doing is inferring, from my posts, something about me personally. I, however, never implied that I was either smarter or better informed on this topic. The fact that I can express myself is due to a good Iowa education, not because I am arrogant. I personally consider that to be an asset rather than a liability as you infer.

      You have a right to your opinion, but it has nothing to do with the truth of the matter. Just because I can express myself clearly doesn't make me arrogant.

      Furthermore, this most recent post of yours fails to live up to the standard laid out by Sam for this site. I suggest that you tone down your rhetoric or he may have to "slap your hand."

      Why are you so threatened just because I present a reasoned and logical position? Clearly my method bothers you; that much is obvious. But is there more to it? Is it the fact that I have put one piece of the puzzle after another together in a logical scenario that really bothers you? If so, why not take the puzzle apart, piece by piece? I won't presume, as you do, to know your motivations. All I know is that you don't engage on the issues. Instead, you attack the person. That is simply the case.

      I am surprised at your psychic abilities. How are you able to know my intentions in my supposed "stroking my ego?" I wish I had that skill. For some reason I'm not able to know what you are thinking as you apparently are able to know what I am thinking. Congratulations to you. I'll bet you are a hoot at dinner parties!

      If my statements "aren't working" then why can't anyone defeat what I am saying? It really isn't that difficult.

      Here, I will give you some ammunition. Why do China and Saudi Arabia have grossly undervalued currencies? Answer: It is to their best advantage to do so. Both receive ample dollars from around the world (primarily the US) with which they can turn around and buy imports with. Yet because their currencies are so undervalued, their own exports are relatively cheap around the world, which helps their internal economies.

      So, why don't you use that argument about the dinar? Clearly Maliki seems to like his weak dinar policy. He gets dollars for oil, just as Saudi Arabia does, and can buy exports with dollars. At the same time, however, he has a very weak dinar, relatively speaking, which makes his exports cheap around the world (what few there are). So what incentive does he have to change? In particular, why would he want the VALUE of the dinar to rise?

      There, I've given you a good tool to use against me.

      Enorrste

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    7. Steve - "Why do China and Saudi Arabia have grossly undervalued currencies? Answer: It is to their best advantage to do so. Both receive ample dollars from around the world (primarily the US) with which they can turn around and buy imports with. Yet because their currencies are so undervalued, their own exports are relatively cheap around the world, which helps their internal economies.

      So, why don't you use that argument about the dinar?"


      - Because Saudi Arabia's M0 = 323bn SAR and M2 money supply = 126bn SAR which is 619x smaller than Iraq's despite having a 5x larger economy...

      - And China's M0 = 5.4tn CNY and M2 = 105tn (spread across 1.5bn people with a 59x larger economy than Iraq's).

      - Iraq's is 33bn & 78tn (spread across only 30bn people).

      The answer is quite simply - Iraq's currency is so badly inflated & over-printed that it simply isn't undervalued vs the $. Iraq has printed 619x more Dinar than Saudi Arabia and has a 4.9x smaller economy. Adjust for GDP, Iraq has printed over 3,000x more money per % GDP than Saudi Arabia.

      Your arrogant cockiness of "Oh look! I've given you ammunition to use against me" has just blown-back spectacularly...

      Delete
    8. Again, you are not a threat. To answer your question simply. People with egos and arrogance become instant targets for me. Why? Because I'm a mean person and because I can. It's fun for me. It's been awhile since I pushed some douchebags buttons and you just happened to show up. I don't debate dinar any longer. The reason is very evident in this thread with the posts. When someone who has made up their mind as to what will happen meets another with a polar opposite idea, there isn't enough debate in the world to change either view. You know unstoppable force meets an imovable object kinda thing. Pointless. All it turns into is a penis size competition and a pissing match. Oh and my rhetoric isn't going to change because you suggest it to.

      I do however have a question which you have failed to answer countless times. Just one question so it shouldn't be too hard for you to keep track.

      Why would Iraq announce they are going to rv their currency before the fact?

      Delete
    9. Brian, good response. I have nothing more to add. I could, but you did well.

      Whispering, you ask a good question. I have read a number of articles that talk about the inherent pride of Iraq and their deep desire to return to a situation that existed prior to the Saddam Hussein regime. In many of the original "announcement" cases this was specifically referred to (I gave some examples last night here). I've always understood this to be a "get back to normal" from the Iraqi point of view (GOI, Parliament, CBI, and the "peeps"). It is an ego thing, ultimately.

      I detect that you are suggesting that it is quite unusual to announce an RV in advance, and, as far as I know, you are correct. However, the RV is no longer on the table, as I understand it. It is NOT unusual for a country to announce that they will soon change their "exchange rate regime." I gave an example where 6 Middle East countries, including Iraq, have done just that. Similarly, there is a long term plan to create a single unified GCC currency, set to go about 2015 currently. So announcements are not without precedent. An RV announcement would be, but an exchange rate regime change would not (i.e., from a fixed rate to a float). The actual "event" will just show up on Forex some day, I suppose, but Iraq will first have to move itself from Article 14 of the IMF Charter (where they have protection from international lawsuits) to Article 8 of the same charter,which is where all of the world's "players" reside (internationally recognized currency, open trading, eligible to be sued, etc.) So I am waiting for this announcement before much else should be expected. It only involves a letter from Turki to the IMF. The country is the driving force, not the IMF. The choice of timing is totally up to Iraq.

      Thank you for your transparency about your personality. I'd never have known (LOL).

      Enorrste

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  25. One more thing Steve. You say that Iraq is going to reduce its money supply from 33 trillion to 25 billion without a LOP but by "removing" notes from circulation. So Iraq is going to "remove" its entire money supply from circulation except 25 million USD worth and then RV by 100,000%? Do you spewrews even stop to think about the nonsense that you spew? Do you think that just maybe they are referring to a RD when they say 33 trillion to 25 billion or is that too logical for a GO RV mind?

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    1. I have already posted the CBI statement that the revaluation precedes the redenomination. Therefore your question is without foundation. The reduction of the money supply will take place gradually, as stated, AFTER an increase in the value of the dinar. CBI said this, not me. You put the cart in front of the horse (i.e., redenomination first, then reduction in money supply second). That is your mistake.

      Delete
  26. Wait a minute guys, haven't you been listening to mr ZAP? TRILLIONS have been released now and all humanity is set to benefit! This is life and world-changing!!!

    So no RV funds, no Prosperity Programs funds, and no CMKX funds???? aw hell no....i was all set to become a galzillionaire any day now!!! LMFAO!!

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    1. I know you are joking, Lloyd, but you are correct: no prosperity program, no Nesara, no Corporation of America, and no CMKX funds. S

      Delete
  27. OK Steve. So the RV will take place first? So the 33 trillion M1 will become worth 33 trillion USD like spewrews claim and then what? Are they going to remove 32 trillion 975 billion from circulation then leaving 25 billion dinar in circulation? Hahahaha...let me guess....the CBI said so huh? It's no wonder thousands are so confused with spewrews spouting nonsense constantly.

    Here is how redenominations work so that your followers aka "victims" will cease to be confused. This is exactly how Mexico, Venezuela, Turkey, Russia, and dozens of other countries have done it through the years and how Iraq has told us hundreds of times they will do it even going as far as mentioning a few of these countries above in their plans. They create an entirely new currency completely independent of the hyperinflated dinar that we hold. The new currency holds a value exactly 1000 times more than the hyperinflated dinar that we hold. You can either exchange your hyperinflated dinar for the new dinar at a 1000 to 1 ratio or you can use your hyperinflated dinar to purchase items for a period of up to 2 to 10 years. Still seems to be undetermined. During this time both currencies coexist and both can be used for purchases. For instance. The pack of cigs can be bought using 1 new dinar or 1000 old dinar. Each one worth 1USD.

    This is what Iraq and the CBI have told us hundreds of times they will do. Not some made up impossible RV by some how removing their entire money supply from circulation. The only thing getting removed from circulation is the dinar that we hold when it is replaced by the new currency at which time our dinar will become worthless just as Sam has been pointing out.

    Steve or enorset or guru spewrew whoever you are.....above what I stated is fact. Iraq has said so many times and there are hundreds of articles and audios to prove it. That topped off with the fact that RVs are a complete myth which is another economic fact just goes to show that you are not only beyond wrong but obviously purposefully spinning what Iraq is saying and misleading thousands of people in the process.

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    1. I have never intentionally mislead anyone. I have nothing to gain by engaging with you or anyone else on this matter. I have dinar and will do what I will do at the appropriate time, after which you and others will never hear of me again.

      In your last paragraph you talk about the "fact" that RVs are a complete myth. Are you really that ignorant? I won't even justify that sort of statement with a response.

      Then you talk about "what Iraq and the CBI have told us hundreds of times they will do." Yet I have produced STATEMENTS directly from the CBI that tell us their plan, and they do NOT give as clear a picture as you project that they do. Therefore, you are being duplicitous, quite frankly. Just stick to the truth. Stop bloviating. Your statements betray your ignorance of the matter.

      Your statement about "how redenominations work" is absolutely correct. What you leave out is the FACT that the CBI has stated that they will RAISE THE VALUE OF THE DINAR and THEN redenominate. Oh, you missed that? Look up in the thread. I posted THEIR statement that says exactly that.

      So, yes, the revaluation will take place first. But NO, the 33 trillion dinars will NOT become $33 trillion. Why? Because they will FLOAT the currency, from 1166 to 1 and the money supply will be 33 trillion dinars worth about $33 billion (covered by $70 billion in reserves!). As the value RISES (see the CBI articles) they will gradually (their words, not mine) remove the larger denominated notes, first the 25000 and then on down to 1000, AS the dinar RISES. Removal of the notes will take up to 2 years, so we can expect the rise in the value of the dinar to occur over a 2 year period, at least. As the value rises and the large notes are withdrawn, the money supply drops (duh). Eventually no large notes will remain in circulation (including our own as investors, since they will be in federal reserves around the world).
      Now, here is something you hadn't probably thought about. Are the trillions of dollars sitting in reserves around the world included in M1 (or ANY compilation of our money supply)? NO, they are NOT!
      Similarly, the dinar outside of Iraq will NOT be included in the reduced money supply once the new currency is distributed (CBI, not me). Furthermore, our dinars will NEVER go back to Iraq, just as our dollars in China will NEVER come back to America. This is how the current world currency situation was created in 1971 during Nixon's admin. when he took us off the gold standard (read The Creature From Jekyll Island for the full story).
      Iraq will become a "player" in the real world as it grows, with its currency becoming a world reserve currency. THIS IS A GAME! I'm not naive. But it is a solution to a growing international problem. And it was devised by the Bush administration and WILL BE CARRIED OUT. This is an attempt to establish a new method of stabilizing the world currency markets to allow for continued commerce and avoid a collapse, which is imminent. I need not go farther. If you are ignorant of this problem then I pity you.

      Bottom line: M1 will gradually reduce in Iraq as the value of the dinar rises. It will go from 33 trillion to 25 billion. At that point Iraq will have the strongest currency in the world. Saleh said so!

      If you just stop, read, listen, and think, this is totally LOGICAL. You make statements that are NOT logical and then knock them down. How about dealing with the LOGICAL statements in this post? That would be a start, right?

      Enorrste

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    2. Steve - "So, yes, the revaluation will take place first. But NO, the 33 trillion dinars will NOT become $33 trillion. Why? Because they will FLOAT the currency, from 1166 to 1 and the money supply will be 33 trillion dinars worth about $33 billion (covered by $70 billion in reserves!)"

      Aside from complete and utter economic gibberish, you can't even get your basic maths right. If 33tn Dinar (33,000bn Dinar) is worth only $33bn internationally, then the floated exchange rate will not be 1:1 it will be 1000:1 since - by your own admission - Iraq has only $1 to back (and buy back) each 1,000 Dinar! Not only do you not understand what we're saying - you don't even understand a word of what *you're* saying! LOL. 33,0000 divided by 33 = 1,000, not 1!

      Iraq cannot "float" the Dinar anywhere because a currency's floated value = it's total money supply divided by the nation's FX reserves. 78,000bn divided by $65-$70bn = The Dinar is already at its market value below 1000:1! It won't "float up to match the $" for the same reason the Zimbabwe Dollar won't - chronic inflation is not "hidden undervalued wealth" nor an "asset that backs itself" no matter how much you hallucinate to the contrary.

      Iraq has 33tn banknotes and 78tn Dinar total money supply. Yes, they've created 78tn Dinar - deal with it. They have $65-70bn in reserves to back ALL of that with (not just the notes - but bank balances, bank transfers for ordinary trade, etc). Stop being so arrogantly self-centered and obsessed about you, you you - Iraq has to back ALL their 78tn circulated money with their FX reserves for normal trade, not just a few notes sold to amateur tunnel-vision clueless speculators who like yourself seem to have great difficulty grasping the fact most cross-border trade is done with bank transfers, not paper money in suitcases!

      They can't "float" it to 1:1 $ parity prior to any lop precisely because that would require 78,000 Dinar x 1,166 = $90tn ($90,000bn) dollars to back, and they only have $70bn of FX reserves which wouldn't even cover 0.077% of their current circulation or 0.186% of just banknotes alone!

      In fact, $90,000bn is not only several times more money than if every American everywhere gave all their $ to Iraq to back the Dinar with - it's actually more than combined value of all banknotes of all countries on Earth combined! That's how utterly delusional your claim of 1:1 without a lop really is...

      The Dinar's value cannot rise just by declaring it to be worth 1,000x more as it requires the same in FX reserves to back it up at desired ratio!. 78tn Dinar divided by $65-70tn reserves = 1114-1200 value. Conversely 1:1 ratio requires Iraq to have $78,000bn reserves (1114-1200x more than they do now). You can shriek, wail, stamp your feet about "Iraq is different", "It's all Bush's master plan, dude", "It's Nixon's Illuminati master plan", etc, conspiracy nonsense all you want - Iraq is no different and the Dinar is no more going to be 1:1 on $70bn reserves than you could walk into a Porsche showroom and buy a Porsche Boxster by giving the salesman $50 and telling him to "pretend" it's really $50,000... People will ignore an over-pegged Dinar just like they ignore North Korea's over-valued peg.


      Steve - "If you just stop, read, listen, and think, this is totally LOGICAL."

      For you, 1+1 = 735.233456 is "totally logical" if it involved free money from the 'RV fairies'... LOL. "33tn Dinar is really 33tn wealth when it suits me but only 33bn when it doesn't" isn't an argument - it's a cry for help to "keep the dream alive". You really are in a world of your own...

      Delete
    3. Thank you for presenting your case. Unfortunately you failed to see in my first sentence that the float will go from 1166 to 1 (today's rate) and gradually rise AS the money supply DECREASES. Therefore, I never said they would somehow "float" from $1. I said they would float from today's rate of 1166.

      Therefore, your are correct that the "float" rate would be, approximately 1000:1 as you noted. Once again, you knock down what I never said. After all, 1166 to 1 is in the paragraph, right?

      You said:

      "Iraq has to back ALL their 78tn circulated money with their FX reserves for normal trade."

      Really? Then how can the US have a relatively stable dollar and only have 15% coverage of its currency. Furthermore, how could the US GIVE Europe over 16 trillion dollars as they did shortly after Obama took office, without "backing it?"

      Clearly Iraq does not have to have 100% backing of its currency to function. No one in the world has that. So your point is not made.

      In order to float from 1166 to 1 to whatever value is eventually reached involves NO RISK for the CBI whatsoever. For every buyer there is a seller. It is a zero sum game. The CBI doesn't have to do a thing. However, they have stated that as the value rises they will gradually reduce the money supply, effectively controlling the RATE of rise, but not the END of the rise (I can find the article that specifically states this if necessary). The fact that they will gradually reduce the money supply is the intervention that will allow the rate to rise. That is how monetary policy works, as you know. By reducing the money supply the dinar will HAVE to rise in value, and that is the plan as stated by the CBI.

      Therefore, given that you have again neglected to include the reduction in money supply into your statements, they all have no meaning since that is not the stated plan of the CBI. As long as the money supply drops coincidentally with the rise in the value of the dinar, parity, as you call it, will be maintained. But it will be maintained at an ever increasing rate in the value of the dinar.

      Shabibi showed over several years that he could control the rate, which he did. While he was in office the "market rate" within the country seldom varied from the official 1166 o 1 rate. Only after he left did Turki start having difficulties, even though reserves continued to rise. The reason: money leaving the country for Syria and Iran (this is not my concern, however).

      How else could they get down to 33 billion dinars than removing most of the current money supply? And, if that is what they are saying they are going to do, how can you ignore that important fact in your "numbers" above?

      Once you include this extremely important fact, stated by the CBI itself, then the "affordability" issue desolves, as I said in an earlier response.

      I appreciate where you are coming from. It would clearly be impossible if the situation were as you describe it. But the CBI has stated that they are going to do this, and how they are going to do it. To ignore their own "solution" (not mine) makes your case that "it's impossible!" as solid as gold. However, it is a shadow that does not exist because it doesn't take into account the CBI's own statements about its plan, formulated in 2005 with a 10 year goal for completion.

      Enorrste

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    4. Steve - "Thank you for presenting your case. Unfortunately you failed to see in my first sentence that the float will go from 1166 to 1 (today's rate) and gradually rise AS the money supply DECREASES. Therefore, I never said they would somehow "float" from $1. I said they would float from today's rate of 1166."

      Unfortunately for you it doesn't work like that and your *opinion* is just severely confused wishful thinking in stark ignorance of economic reality. A lop reduces money supply by 99.9% but maintains liquidity due to being value neutral. Your delusional RV, involving taking 99.9% of all money out of circulation without a lop would plunge Iraq into financial ruin and a Great Depression long before they gained anything off of a rising Dinar. In fact Iraqi's will be plunged into ruin without gaining anything at all since appreciation doesn't affect domestic goods, but money shortages does. There would be riots in the streets as people would literally run out of money to buy food or even get paid for work.

      You still don't get it do you beyond your self-centered tunnel vision of "me and my banknotes" do you? The Iraqi Dinar is for Iraqi's to trade with. For trade to work you need both liquidity and a relatively stable value. The US Great Depression was caused by the Fed removing 30% of money (non-lop). If 99.9% of money disappeared, trust in the currency would catastrophically collapse inside Iraq due to a liquidity crisis, and Iraqi's would ditch it and just use $. It would actually end up a junk currency.

      And if the Dinar appreciated 99,000% over 10 years, that's equivalent to an annual rate of price inflation for non-Iraqi's importing Iraqi products of 116%... Businessmen would ditch it en masse for trade just like they've ditched the Zimbabwe Dollar - if it isn't stable, people aren't interested in trading it (you know, for real-life grown up global trade not childish get-rich-quick scams).


      Steve - "Then how can the US have a relatively stable dollar and only have 15% coverage of its currency."

      You're comparing apples with oranges. Iraq has to have enough foreign currency to back the Dinar against appreciation vs the $ (or Euro). You're comparing the US not having enough domestic $ to buy domestic US$ (which is meaningless). And yes, the US does have enough FX reserves to trade with currencies at each ones existing exchange rate. At 100:1 vs Japan, the USA needs only $1bn Yen reserves for 100bn Yen trade. This is not the same thing as your magic-bean 99,000% appreciation out of thin air for no reason whatsoever though. Not even close. In fact, it's precisely statements like that that suggest you should get a serious refund on your "economics degree"...


      Steve - "For every buyer there is a seller."

      Yes, and no-one's going to buy a currency for 1,000x more tomorrow vs today to trade with country A, when the cost of trade remains stable with peer countries B, C, & D (eg, Jordan, Greece & Turkey).

      In fact, only complete morons cheer on a 99,000% appreciation of the Dinar vs every other currency on the planet without realizing it has the same effect on global trade as if every country except Iraq all collectively DEVALUED their currencies 1,000x. Something that continues to evade you...

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    5. Steve - "How else could they get down to 33 billion dinars than removing most of the current money supply?"

      Lopping. As they said they would over and over and over again. You simply refuse to hear the truth though because it doesn't promise you "free money". In fact this is why further debate is pointless - we're way past the point where you're simply "looking for the truth". You openly demonstrate you simply don't want to hear it.

      Steve - "However, it is a shadow that does not exist because it doesn't take into account the CBI's own statements about its plan, formulated in 2005 with a 10 year goal for completion."

      Sorry to break it to you, but your 2005 "MOP report" that did the "guru rounds" a few months ago, has long been debunked and was actually written in 1984 (and openly says so on the header page of the report). It was merely uploaded / digitally archived in 2005:-

      "In turn, The Guidance For Technical And Economic Feasibility Studies And Post-Project Assessment Of Development Project (Regulations No. 1 for the Year of 1984 and it’s amendment for the year of 1990) has specifies a series of steps to be undertaken, which lead to the completion of a Capital Budget."
      http://www.mop.gov.iq/mop/index.jsp?sid=1&id=295&pid=259&lng=en

      That's yet another thing that like other pumpers, you've simply pretended it to be something it isn't then tried to snobbishly talk down to everyone else like we're all idiots "not sharing the secret". There was no "2005 report" - there was a 1984 report talking about conditions in 1984 uploaded to the website in 2005. This has been debunked so many times, it's laughable people still fall for it. In fact, part of your 2005 report even talks about new-fangled technology like "Telex machines". LOL.

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    6. For ease I will work my way backwards on your post. I was not referring to the MOP report that you mentioned. I was referring to the Ministry of Planning recommendation to the CBI in 2005 that was subsequently accepted. It is specifically described as a 7 year plan.

      We start our journey back in September of 2005 when an official statement was released to the media in which it was announced that Al Zubaidi, the head of the Ministry of Finance, had recommended to Shabibi, the head of the CBI, “Shabibi needs to raise the value of the Iraqi dinar and return to normal through the lifting of three zeroes.” In addition the article showed that the CBI, the Ministry of Finance, and the Central Bank would bring experts together and that “the proposals to get the value of the Iraqi dinar equivalent of [to] the American dollar, this goal we will strive to achieve.” http://www.talkgold.com/forum/showthread.php?t=28719&page=44

      In June of 2006, just eight months later, the original proposal was expanded upon just slightly by the Ministry of Finance and the CBI in a joint statement: “The Ministry of Finance together with the Central Bank are studying a proposal to raise the value of the Iraqi dinar in order to return it to previous levels where one Iraqi dinar was valued at 3.33 US dollars.” Further elaboration on the plan that was being worked on was also given in the same article: “A statement by B.J. AL Zubaidi, the Minister of Finance, in which he said that he had suggested to the Chairman of the Central Bank, Dr. Sinan AL Shibibi, that three zeros be taken from the Iraqi Dinar in order to raise its value so that one Dinar be equal to a Dollar.”
      http://www.iraqdirectory.com/DisplayNews.aspx?id=1593

      I guess I should have included this earlier. I assumed that you were aware of the plan.

      I will send this off now and then return to the top of your post to respond in my next post.

      Enorrste

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    7. I find it fascinating that you are (I'm paraphrasing here) boggled that I don't seem to "get it." You make comments to that effect in almost every post.

      So, now it is my turn. I am baffled that you don't "get it." Let me try to simplify this for you. If the CBI traded 5 days a week then they would have 260 trading days per year, right? Saleh stated that once the process of removing the zeros began it would take about 2 years to complete. That would mean about 520 trading days.

      Now the current rate of the dinar is 1166 to one. If the rate went up on 2 pips per trading day over those two years, the then rate would be about 126 to 1 at the end of 2 years. If, on the other hand, it went up 3 pips per day over the 2 year period then the rate would end up at over $1 per dinar (a total of 1560 pips upward, versus 1166 starting rate). There is no shock here whatsoever. It would just be the normal market forces pushing the rate upward, gradually, as I have stated (and so has the CBI). Add to that the fact that as the value of the dinar rises the value of large notes also rises. At some point it would become inconvenient to carry a 25000 dinar note around, and then a 10000 dinar note, and so on, until, 2 years later, they would be gone. In their place, again gradually, the CBI would issue smaller notes to replace a PORTION of the money supply removed by the large notes. Through this very methodical process the old large notes would disappear and new smaller denoms, with relatively similar value, would replace them. That is the plan. I hope you can see with this "pip" example that this is not a shock to the system within the country.

      Enorrste

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    8. Steve, your links are nothing more than 3rd hand blog posts who like you conflate their own personal desires with quotes they don't even bother to accurately quote. "Shabibi needs to raise the value of the Iraqi dinar and return to normal through the lifting of three zeroes" somehow ended up "Buy $1k of Dinar now and cash in for $3m in a years time because what Shabibi "really" meant was the Dinar will appreciate 299,000%". It's the same BS game of Chinese Whispers you play here now that it was 8 years ago.

      Your Iraq Directory link is mostly author opinion before the pseudo-paraphrase-"quote". It's not proof of anything other than your addiction to twist everything around to mean what you want it to mean and to post third-hand forum opinions as "sourced fact".

      The same Al Zubaidi who talked about lopping 3 zeroes (in your link) also 3 years later said Iraq had so little money they might need to ask the IMF for a loan:-

      http://www.alsumaria.tv/news/8902/iraq-might-ask-for-an-imf-loan-minister

      So much for all that "hidden wealth" eh? That link was from a leading Iraqi TV channel who have run and re-run programs openly describing the lop - yes a lop:-

      http://www.iraq-businessnews.com/2010/10/17/alsumaria-tv-to-re-run-dinar-re-denomination-prog/

      Hour long episodes have been broadcast on Iraqi TV, all talking about the same thing the CBI talk about when they've said - quote - "this experience had previously been applied in countries such as Turkey", "the re-denomination of Iraqi Dinar will not have a major influence on the purchasing power of the Iraqi Dinar", "This will include a new 50 Dinar bill with a value of $43", "The change that will take place with the Iraqi currency will change the face value of the dinar and not the real value as measured by the value of Iraqi dinar against the dollar and gold, "the exchange rate between the new banknotes and the old ones would be 1:1,000", "You will hand 1,000 Dinar note over and get 1 Dinar note back - but that 1 Dinar note ill be worth 1,000x more", etc.

      But since I guess that doesn't fit your narrative either, you'll conveniently ignore it... You won't find the episodes on forums like DinarRecaps, DinarVets, etc, either for the same reason you don't want to talk about them - it shatters the dream, and forums like DV & DR are all about group hugs, peer ego feeding, and emotional comfort blankets rather than serious research.


      And the 1 Dinar = $3 wasn't even real back in the 80's as explained to you yesterday (which you ignored as usual). It was a false overvalued peg declared by dictator Saddam that the market rejected and a black market (real rate) sprung up several times lower. Anyone spouting the "1 Dinar will = $3 just like in the 1980's" has no idea what they're talking about - both today and 1980's Iraq because the market rejected Saddam's attempted peg at that rate. Saddam wanted 1 Dinar to be $3 - but it never was. Get over it.

      All you're doing is clamping yourself like a leech onto anything that sounds nice (confirmation bias) no matter how baseless. As I said above, serious debate is pointless. You haven't bothered to reply to anything of substance beyond shouting "I want a pony! You promised!" louder & louder and quoting other people who also want a pony as "proof" with your circular pumper referencing. It's as childish & desperate now as it was the first time.

      Delete
    9. Asking for a loan from the IMF has nothing to do with what we are discussing. Budget matters is what that referred to; only that. There is no link to what we are talking about.

      The rate of $3.33 existed as a real rate PRIOR to Saddam Hussein. Saddam reigned 26 years and was removed in 2003; remove 26 years and you get 1987. The $3.33 rate was in the early 80s, and it was real then.

      I honestly don't know what it is about you and Whisper. You just can't help attacking the person, can you? I feel sorry for you.

      We don't have to agree. Heck, we don't agree. That much is obvious, but it doesn't mean you have to devolve into vitriol and personal attacks to be understood. Do you really believe that belittling me will make your point? I suspect that those who read all this, if anyone even bothers, will see the disparity between your approach (both of you) and mine, and then draw their own conclusions.

      Take care, both of you. This has been difficult, but revealing, to say the least.

      Steve

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  28. I'm sorry, but how are they going to reduce the supply from 33 trillion to 25 billion again?

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    1. Answer is given in the post just above.

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    2. You haven't heard? People are just going to voluntarily turn their dinar into the CBI and let them burn them. In addition the CBI is just going to wipe out the balances in everyone's bank account. They don't expect anything in return. They're just doing it for the good of the country so they can "raise" the value and a bunch of American speculators can make a few million dollars. They only need 99% of dinar to be turned in. The citizens of Iraq are perfectly willing to do it. A bunch of articles have said this is the plan. Why would you question it? It sounds like a solid plan to me. LOL!

      Delete
  29. Wow. I don't even know where to start. I am ignorant because RVs are a myth? Please show us one. Give us an example of on throughout history. Please go ahead and tell us about China who went 30% over a period of years and prove my point that RVs like you spew are fantasy.

    They will float the dinar from 1166 to 1 but the money supply won't be 33 trillion but 33 billion? I know you gurus have a problem with math but what have you been smoking?

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    1. Before the Chinese government revalued its currency it was pegged to the USD. It is now pegged to a basket of world currencies. The change led to a revaluation upward of the yuan.

      That is one, as you asked.

      I've already explained how the CBI intends to reduce the money supply from 33 trillion dinars now to a projected money supply of 25 billion dinars (not 33 billion). If you can't read what I've already posted, then I suggest you ask them how they are going to do it. I didn't make this up: they did! I suggest you argue with them instead of me. I just posted their statement. Take it as you will.

      At least I offer you something to defend against. It just pisses you all off that you can't do the same thing. Show me ONE article that clearly states your case. Just one. That isn't too much to ask, is it? But remember, just because an article has the word "redenomination" in it doesn't mean that your pre-conceived idea about that is what the CBI intends to do. They will redenominate, but only after they revalue the currency to a level of their own choosing. That is why they keep pushing it back. They must get the value of the dinar up first, then change the currency.

      Enorrste

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    2. Dude.......where have you been? There have been numerous articles stating 1000 to 1 exchange, using Turkey as an example, saying redenomination ( I guess redenomination means whatever spewrews make up huh?) Trillions to billions alone means a common RD. Currencies coexist, 1000 note becomes a 1 note. How many more ways do they need to describe a straight up common redenomination before con men quit making up whatever sounds good to keep the sheep on the flock?

      Yes they say they will raise the value. Probably to 1000 pre RD. Sound familiar? RV before RD? I guess GO RV of the brain cannot comprehend such logic. They also are speaking of raising the market rate in most recent articles not the exchange rate. You do know there is a difference Mr 7 years of study right? Seeing how they cannot even get Iraqis to want Dinar then what leads you to believe a float will be successful? The IQD is pegged for a reason. Syabilty and the fact that nobody wants dinar except those that you have brainwashed with you voodo economics. Speaking of bunk economics........what is this nonsense of all the dinar being forgotten about if put into other countries reserves? Lol.....Maybe the US can print a 100 quadrillion USD to put into our reserves to back the dollar. Hahaha. For a guru you seem to be confused. Actually.....now that I think about it.....all of them seem confused.

      Delete
  30. Another thing....sheeezzzz.....you keep spouting off that the CBI is going to remove 32 trillion 975 billion dinar from circulation by removing the 000 notes after your made up fantasy RV that you insist the CBI is telling the world about. What you afail to explain is how. What are they going to exchange for it? More dinar? New dinar? USD? Or is Iraq's M2 or 1 or 0 or which ever your economic degree says is relevant going to decrease by trillions when China and the US put dinar in their reserves? Lol. This is like arguing with 3 year old about the existence of Santa. The bottom line is there money supply cannot decrease unless Iraq gives USD for the trillions of Dinar and then burn the dinar. Even in another countries reserves a dinar is a dinar and should retain value and be considered in Iraq's M2 or else what's the point of countries using them to back their own currencies?

    Also please explain why Iraq doesnt print up 100 trillion dinar for themselves just before your make believe RV that the CBI is telling the world about.

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    1. Precisely. The CBI aren't removing any large notes. Nor have they ever said that outside of pumper-land (what they've actually said is they'll exchange all banknotes at 1:1000 rate - and given details of each new note which annoys pumpers like Enorrste no end who've spent years claiming Iraq will reuse the same notes and sell them at 1000:1 but buy them back 1:1 which would bankrupt all Dinar trading banks overnight...)

      Even if they replace 1x 25k Dinar note for 5x 5k Dinar notes or 50x 500 Dinar notes, it won't shrink the money supply precisely because that 25k is being replaced with 25k. As for removing 25k notes without replacing them outside of a lop - what on earth does he think the Iraqi govt is going to do - walk up to Iraqi's, put a gun to their heads, steal their 25k notes and run away giving nothing in return? Delusional to the core.

      The vast majority of 25k notes in circulation are privately owned cash, not CBI reserves. When Iraqi's earn 25k notes - the cash is theirs to spend, not the government's to confiscate en masse. Steve / Enorrste acts like some confused die-hard Communist - he sees all privately earned Iraqi money as "seizable govt property" - and he can't even see what he's openly cheerleading (basically North Korea style mass enforced confiscation of private wealth) which is amusingly the sole basis of keeping his already debunked "dream" of "millionaire for nothing" alive, because he simply can't handle the repeatedly declared reality of a redenomination / lop because it won't make him rich... :-)

      It still boggles the mind as to how people like Steve cannot see the obvious - if the Dinar appreciated 100,000% vs the $ - without a lop - then that's the same effect on international trade as if all currencies other than Iraq all DEVALUED their currencies by 1,000x! It would result in all Iraqi-Dinar priced Iraqi exports ending up 1,000x more expensive to export! If Iraq exports a $10 product (11,640 Dinars), and they decide each Dinar will now be worth 1,000x more vs the $, it would now take $10,000 to buy those 11,640 Dinar to buy that product) and cost $10,000 to import a $10 product due to a fake-99,000% "RV" over-peg!

      Or in other words, Steve / Enorrste genuinely believes people will happily buy $1,000 loaves of bread tomorrow in Iraq instead of the $1 it takes to buy it today (meanwhile, imported Jordanian & Turkish bread continues to be priced at $1 because the JOD & Lira haven't moved 99,000% vs the $)... Even spaced over two years, he still thinks non-Iraqi businessmen around the world won't notice 115% annual inflation every year for a decade when buying Dinar to trade with Iraq...

      You just can't even begin to argue with that level of reality-divorcement that would result in either the complete catastrophic collapse of Iraq's entire export economy or more likely, the Dinar would be quickly treated as a junk currency for trade that's 1,000x out of touch with the international market value of exports of identical goods & services in every other country (like the defunct Zimbabwe Dollar), and Iraqi's will use $ again...

      I think we've reached the point where all that needs to be said is said. Beyond a certain point its like trying to hold a sensible debate at the local Schizophrenia clinic. He will find "proof of the RV" in a dog turd lying on the pavement if he looks hard enough, yet official statements like "The exchange rate between the new banknotes and the old ones would be 1:1,000" will continue to fly over his head no matter how oft-repeated.

      Have a good evening all.

      Delete
  31. Steve.......are you going to answer my question or are you too busy licking your wounds after the absolute shilacking that you just took from Brian. LOL.

    You say that 000 notes will be removed and replaced by lower demons and this will decrease the money supply by 32 trillion 975 billion. Please explain this stupidity. Thanks in advance.

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    1. Citizens of Iraq are going to turn them into the CBI and let them burn them. And they're going to let the CBI seize their bank accounts. They don't expect anything in return. They're doing it just so Iraq can "raise" the value of the dinar and let a bunch of American speculators make millions of dollars. Sounds like a solid plan to me. You haven't heard?

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    2. First comes a change in the "exchange rate regime" from a fixed rate to a freely floating rate. This will allow the market to determine the direction and final resting value of the dinar.
      Speculators who have, heretofore, stayed away, will climb aboard, including professional Forex traders. Investors who want to make money in Iraq will buy the currency to do business in Iraq. Another force will be the CBI itself. Any dinars they buy on the open market they could just summarily destroy. However that would be foolish, since they would have to buy them with dollars, which would affect their reserves. Instead, they will allow the market to take the risk instead of themselves.
      Remember, currency "trading" is a zero-sum game. For every buyer there is a seller.
      The money supply, as defined by the CBI deals ONLY with the money within the country itself. Therefore, when they talk of reducing the money supply they are referring to within Iraq only.
      Just as the US does not "mention" the trillions of dollars held as reserves around the world when it talks about M1, the CBI will also drop the money outside the borders in its statements once it goes international. This could mean that up to 7 trillion dinars could fall off of M1 instantaneously. This alone would stimulate demand for the dinar.

      As the value increases people in Iraq will become excited that their currency is about to return to its pre-Saddam value. They will become buyers as well. Someone who is a dinar holder will decide to unload. They could do that either within Iraq or on the open international market. The dinars within Iraq get turned into banks, and then go to the CBI. The CBI will destroy these notes as they come in. Similarly, investors from abroad who come to Iraq to invest will spend their dinars in Iraq, and those will go to banks and then to the CBI for destruction. The goal is to destroy enough money supply to get the total money supply down to 33 billion instead of 33 trillion dinars. Saleh has said that he expects the process to last no more than 2 years. A mere 3 pip change daily is sufficient to raise the value of the dinar to $1 in 2 years and at the same time reduce the money supply to 33 billion dinars.
      Now, at a $1 dinar and 33 billion dinar money supply the total value of the money in Iraq is $33 billion. But Iraq has over $75 billion in reserves, or over 250% coverage of its money at that level. It will therefore, by far, be the strongest currency in the world.
      At some point the process will slow down and a relative equilibrium will be reached. There will be minor fluctuations on the open market, but the "stance" of the dinar as a strong international currency will have been established within 2 short years or so, as Saleh stated would be the case.
      In short, the CBI receives the dinars from banks and destroys them.
      Simultaneously, however, as the value of the dinar rises, they will need to issue smaller denominations. Today a 25000 dinar note is worth about $21. But at just 10 cents per dinar that note becomes worth $2500, and becomes a risk to the carrier of it. So you can see how the large notes will go to banks, and then be destroyed. At the same time, the CBI will be issuing 1, 5, 10, 20, 50, 100, and 200 dinar notes (coming out from the highest to the lowest) to keep commerce running smoothly "on the street." At 50 cents per dinar even a 1000 dinar note would be worth $50, so you can see how the 5000, 10000, and 25000 dinar notes would have already been deposited in banks by then. Replacing those would be notes such as 200 dinars, worth $100, and so on down.
      As you can see this has been well thought out by the CBI. They have held seminars all over the country led by economists who understand the process well.

      Enorrste

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    3. 3 pips daily for 2 years? OK........its now crystal clear that you are completely delusional.

      What is backing this daily increase in the exchange rate? Iraq's measily 175 billion a year GDP? Maybe their manufacturing base.....O wait a minute.....Iraq has no manufacturing or factories or skilled workers or tech industry or any industry at all for that matter. What they have is 30 million people in an unstable region who are still blowing each other up daily.

      Once again you are making up economics as you go along. Unfortunately their are victims out there who believe the ignorance you spew. So none of the trillions of dinar that were sold outside if Iraq matter huh? Brian is correct. There is no point in continuing a disscussion with someone who has himself convinced that the CBI is telling the world about a future 100,000% RV of their currency. Delusion cannot be reasoned with.

      By the way....I dare the CBI to float the dinar. The won't dare because nobody wants it including Iraqis. Iraq is the poster child for unstable countries. Yeah.....really a currency that is desired by the world. No......only by misguided "investors". Post RD it is possible to change monetary policy IF confidence has grown due to the new currency being taken out of a hyperinflated state. Float the current dinar that Iraqis don't even want........no way. Iraq can talk all they want but they won't dare.

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    4. LOL Dinarck. It is a bit maddening, isn't it? You should read his book.

      Delete
    5. 2 or 3 pips a day is nothing in currency movement.

      Perhaps you missed the fact that economists all over the world are saying that Iraq is one of the fastest growing economies on the planet. Also, that oil will drive up the value of the dinar? What does the GDP have to do with these two facts alone? The WORLD wants to invest in Iraq! Therefore a free float will work.

      NONE of the dinars outside of Iraq matter. Yes, I said it. And so did Saleh. They will become reserves to bolster other currencies around the world. Look it up! Just as our dollars don't come back, theirs won't come back either.

      Sorry, I can't float the dinar. Only Iraq can, and they said they will. Argue with them about it. And while your at it, argue with the IMF, who are recommending the very same thing (see the post just below). What makes you think that Iraq won't dare float its own currency because "no one will buy it"? Iraq can do whatever it wants to do. They are a sovereign country. Things like this happen all over the world. They actually have a lot of incentive to do just that! Like, foreign investment coming in, for instance. It won't happen if the currency isn't tradable. Are you really that ignorant? The IMF has been working Iraq to just this point for YEARS.

      Now you are arguing with Maliki and Turki, the BOSSES, who said they are ready to bring HUGE amounts of investment into Iraq? How could they do that if the currency isn't tradable?

      Your ignorance of the geopolitical situation is just as large as your obstinance on sticking to the LOP theory. Even the IMF doesn't agree with you (see below)!

      Note that I said you were ignorant, not stupid. There is a difference. In the first instance, you lack knowledge, while in the second you are just plain dumb and couldn't understand even if you wanted to. I used the first, not the second, unlike you and your buddies who insist on slanderous and calumnious remarks that attack me personally instead of DEALING WITH THE ISSUE!

      I can’t believe that you actually believe that Iraq won't dare go to a float on its own.

      Enorrste

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    6. OK, I'm done now. As the old saying goes (and you can use this toward me as I will toward you) "You can lead a horse to water, but you cannot make him drink it!" I think that sums up this debate. We each haven't moved one inch from our original positions. So be it.

      I hope you enjoy the evening and that one of us, at least, laughs his head off when this all comes to a head.

      Steve

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    7. Your article says very clearly that Iraq will stay pegged for the FORSEEABLE FUTURE. Sorry but this doesn't sound like a float to me. They reccommemd that Iraq take steps to bolster its currency so that one day it may be in a position to float. Hmmmmmmmmm........maybe a redenomination may take it out of a hyperinflated state to where it may actually gain confidence amongst the very people who use it. Oh no how ignorant of me. I forgot that a lot of people want to invest in Iraq. Lol. Typical spewrew line. Guess what........a lot of people invest in South Korea and their currency is in a hyperinflated state, a lot of people invest in Japan and their currency is worth around 1 US penny. Of course though spewrews are good at convincing the gullible that investment in Iraq is impossible without the mythical RV first.

      Iraq will not float the current dinar. Guess what......I am right on that so far and you are wrong. Got anymore IMF articles that you can nitpick and spin to mean your Float/RV/remove 99% of dinar from circulation/overnight millionaire creating/blessing/10 year plan/BS? I know spewrews thrive in that department. While you are at it maybe you can find another baddly translated article where a CBI economist supposedly tells of the upcoming 100,000% overnight RV. Unreal.

      And what are you talking about "LOP THEORY". A redenomination is an actual economic event practiced by countries in Iraq's predicament unlike your remove 99% of current from circulation and forget about the trillions strewn around the world ignorance. That is a theory and not even a very good one since there is zero economic evidence to support its existence.

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    8. Also Steve......this entire debate should have ended when Brian brilliantly pointed out exact words FROM THE CBI saying that the REDENOMINATION will result in exchange at 1000 to 1 where you will receive 1NEW DINAR NOTE for a 1000 note amonst other statements that are absolute proof of a common RD. Of course as a spewrew you chose to ignore those crystal clear statements and continue on with your delusion interpretations of what Iraq is saying. Typical. So you are correct. Neither of us will move from our position. My position of reality and your posiition of delusion. You are also correct that we will look back and laugh. Me looking back and laughing at all the GO RVers crying when it LOPs and you looking back and laughing at all the people that you were able to convince of economic fantasy.

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    9. Well Steve I appreciate the entertainment you've provided for us the past couple of days. You're never boring, that's for sure. I'll give you this. You've certainly got a vivid imagination. If you had ever been right about anything I might think you're a flippin' genius and hop on the Kap/Steve float boat. Unfortunately you haven't been.


      2-29-2010 Iraq will RV at $2.65 by March 1, 2010 or the budget has no credibility

      4-20-2011 Shabs said in July 2010 that 70% of the large notes were removed, so 27 trillion dinar was already reduced to 8.1 trillion at that time.

      4-20-2011 "I tend to agree with Bluwolf that it will come out in the $4 range, then rise to something around $6, and within months (3-6) go as high as $10, or more"

      7-8-2011 "The way I understand it this “ping” thing began some time ago (3 weeks I think) and it is slowly approaching the $5.25 number…when it gets there (possibly any time between now and Monday) we will see the RV"

      9-16-2011 "We are being told, by the CBI directly, that the time is now upon us. I believe the RV will occur very soon with the existing small bills first and they will be replaced, at the already NEW value, in 2012"

      12-4-2011 Iraq has to have a tradeable currency to be considered a sovereign nation, so they will need to RV before Maliki meets with Obama December 12.

      2-2-2012 "both CBI and Parliament are ready to do this YESTERDAY…if the GOI does something, expect an RV. If not, look to Shabibi to go solo and pull the trigger. I personally believe it is now very close because of the hemhorraging of dollars from CBI into Iran…They will have to RV to get the dinar up to at least $1 so that they can stop selling dollars on the open market in Iraq…I give it 3 weeks maximum. But then again I could be wrong! LOL."

      2-24-2012 "CBI announced that 2013 budget has the new rate in it. They want 6 months for both large and small notes to co-exist. Therefore June 2012 is the drop-dead date for the RV."

      2-25-2012 "The best we can hope for is before the Arab Summit, and…there are good reasons to believe we will see it before then."

      2-26-2012 "the 2013 budget…takes effect 1/1/2013, so they must do the RV prior to that."

      3-21-2012 The IMF will release Iraq from Ch 7 in June 2012

      4-2-2012 "We…have the clear statement from the CBI that the process of “removing the three zeros” is essentially completed inside Iraq."

      4-3-2012 The 2013 budget will be based on the new rate.

      4-5-2012 Shabibi will almost certainly pull the trigger before the end of April 2012.

      4-9-2012 "I don’t think M’s attempt to get Shabs fired will go anywhere, especially now that he has to be concerned about his OWN job."

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    10. "And within 3 to 6 months go as high as $10 or more"

      ROTFLMFAO

      Hahahahahaha great find Sam. It's pretty clear what we have been dealing with the past few days. Unfreakin real

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    11. "A mere 2 pip change daily is sufficient to raise the value of the dinar to $1 in 2 years and at the same time reduce the money supply to 33 billion dinar"

      ROFL!!! OMG! You can't even get your maths or terminology right about this despite laughably claiming to be a "professional Forex trader"!

      A "PIP" is a "Percentage In Point" - it's a fraction OF a point of a movement between a currency pair, to 4 decimal places (a 0.0001 movement). Example:-

      If the currency pair of the Euro vs USD is trading at an exchange rate of 1.3000 (1 EUR = 1.3 USD) and the rate changes to 1.3010, the price ratio increased by 10 pips. 1 pip = 0.0001 movement - NOT 1.000 movement.

      If Iraq moves "2 pips per day for 2 years" given 260 trading days per year, then 1164:1 would move to 1163.480:1 after 2 years. If Iraq moved 2 pips per day for 260 days per year, then it would take 2,238 years to get to 1:1. What you actually meant to say was "If Iraq moved 2,000 pips per day (or two POINTS), then it would take two years" except that it wouldn't because currencies don't work like or become 1,000x more valuable with nothing backing them just because you screech "I want it, I want it, I want it" in web forums...

      Even if being a weaker denomination, a pip on the Dinar was 0.001 instead of 0.0001 (3 instead of 4 decimal places as happens with the Yen), it would still take 223.8 years to get there at "2 pips per day".

      At 1164, the Dinar is 1,164,000 pips (4 decimal places) or 116,400 pips (3 decimal places) above the $, not 1,164 pips! It seems despite your proclaimed "Series 7 pro trading license", you clearly do not understand even basic Forex terminology, the difference between a pip and a point and you obviously cannot tell the difference between 1,000 vs 100,000 or 1,000,000.

      You're right - it's best to end the debate here - out of sheer embarrassment...

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    12. Me - "If Iraq moves "2 pips per day for 2 years" given 260 trading days per year, then 1164:1 would move to 1163.480:1 after 2 years."

      Sorry that should have read "then 1164:1 would move to 1163.480:1 after 1 year and 1162.960:1 after 2 years. Point still stands though - there are 1.164m pips between the USD & IQD - not 1.164k as "Steve" / "Enorrste" falsely claimed...

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    13. Steve,

      How dense are you? Since you insist that Iraq is going to reduce it's money supply without demonetizing and if the CBI doesn't buy back dinar, how is Iraq going to do it? People trading currencies in forex doesn't change the supply of the currency. If the CBI doesn't literally buy the dinar and destroy them, the supply has not been reduced. If they don't seize and close bank accounts, the supply has not been reduced. People aren't going to turn in dinar out of the goodness of their hearts for nothing. They're going to expect something in return. So what in the world is the CBI going to give offer in exchange for everyone's dinar? How are they going to reduce their supply without demonetizing? They can't! It is impossible. It's a laughable assertion!

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    14. What I find most amazing about this litany of errors, is not that the opinions of those making these predictions have never been correct but that so many of these predictions are phrased as FACTs. e.g.

      2-26-2012 "the 2013 budget…takes effect 1/1/2013, so they must do the RV prior to that."

      Not "I think they might RV prior to that", but that they MUST do so. I am a computer expert, not a phycology/brain science expert, but in my experience even without the practice of explicitly evaluating one's own past predictions, its just human nature for such evaluations to build up. One day you just find yourself saying, hey what the heck maybe this whole thing IS bogus and the belief crumbles into myth in short order.

      There certainly are followers of the dinar myth that really do believe (many of whom reject the gurus, in my view exactly due to the gurus' performance being contradictory evidence to the belief) and then there are those that know full well an overnight RV of even 2x is impossible and are knowingly misleading folks. Its hard for me to think that anyone making so many claims as FACT for so many years and having them all turn out to be wrong isn't in the latter group. Belief is a powerful thing and can overcome much in the way of contradictory evidence, but this is such an extreme its hard for me to accept that there isn't knowing misleading going on here.

      Delete
  32. I’m not going to read through all these post and argue point by point on everything, but there are two things being talked about in Iraq right now. One is that they would like to increase the value of the dinar. A RV if that’s what you want to call it. But that is a small increase in value and done not overnight, but in a controlled and orderly fashion.
    The other thing being discussed is the redenomination. Any time and every time they mention 3 zeros being deleted it is in reference to the redenomination. They also say that the redenomination will help with the revalue mentioned above. If they redenominate they believe demand for the currency will go up.
    So two separate events.
    Event 1: A normal small RV of the currency that might be expected in just about any country/currency. Say a few percent up to 15% or so, whatever gets them to 1000:1. I think they want 1000:1 so when they do event 2 they will 1:1 with the dollar.
    Event 2: A redenomination removing 3 zeros. EVERY, not some, EVERY current dinar will have to be traded in for new dinar at a rate of 1000 old for 1 new. The new currency will have a rate of $.86 per dinar based on current exchange rate. If the rate goes up to 1000:1 from event 1 prior to the redenomination then the rate on the new currency will be 1:1. Most importantly… the new rate will only be on the new currency. The exchange rate for the old currency will not change due to event 2.

    Gurus are perpetuating the dinar scam by melding these two events into some kind of never seen before huge RV that is all aspects impossible.

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  33. The following just came from the IMF:

    IRAQ
    2013 ARTICLE IV CONSULTATION

    July 2013

    14. The de facto fixed exchange rate has served Iraq well. The authorities agreed that a
    stable nominal exchange rate provides a valuable anchor for inflation expectations in an
    uncertain environment, and intend to continue implementing this policy for the foreseeable future. In the medium term, staff encouraged the authorities to consider creating the conditions which would make possible a move to a more flexible exchange rate policy. Such flexibility could allow a predictable and gradual appreciation of the nominal exchange rate, triggered by strong oil revenues and the Balassa-Samuelson effect, to accommodate a possible real exchange rate appreciation while keeping domestic inflation low.

    http://www.imf.org/external/pubs/ft/scr/2013/cr13217.pdf

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    1. This comment has been removed by the author.

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    2. So? Indeed the exchange rate for Iraq's currency might go up a few percent over the next few decades. Or it might go down a few percent (or up and down and up and down, like currencies often do). How is that relevant to anything being discussed here?

      Above you say "The goal is to destroy enough money supply to get the total money supply down to 33 billion instead of 33 trillion dinars." Do reduce physical cash by 1000x you would have to remove 99.9% of it, there would be no dinars left in Iraq at all. So what happens when someone wants to make a withdrawal form the 42T dinars in banks (i.e. M1 is 75T, only 33T of which is physical cash)? Obviously this is nonsense. A country's money supply can not be so drastically reduced without it shutting down the economy.

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    3. Looks like they're pretty happy with a stable exchange rate and would like to continue it. If they decide to allow the dinar to float some day it might go up or it might go down. If you're lucky, you might be able to break even on your "investment" in 20 years after paying the exchange fees. What a great deal!

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    4. John, the current money supply is worth $33 billion American. By the time the money supply is reduced to 33 billion dinars (a process that will take 2 years, while the value gradually rises in the dinar) the total money supply will then be 33 billion dinars worth $33 billion American. Therefore the VALUE STAYS THE SAME. Get it?

      Just because the number of pieces of paper falls, or changes, does NOT mean that the VALUE of the money supply changes.

      Enorrste

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    5. It was my error to use the word "pip" instead of "point." It is obvious from the context that I was referring to points. Having said that the change would be less than 2/10th of 1 percent per day, which is not unlikely to occur, especially with all of the attention Iraq has been getting since release from Chapter VII.

      Enorrste

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    6. As of April 2013 M1 was 70T dinars or 60B USD and M2 was 83T IQD or 71B USD, so lets get the number straight to start with.

      How does this "reduction" take place? How will IQD come into the CBI (where it no longer counts against the money supply) yet no dollars corresponding to that amount leave the reserves such that the money supply to reserves ratio improves?

      Indeed the number of notes is irrelevant, just as notes vs digital dinars is irrelevant, or large denominations vs small ones. Its all dinars and is all a liability against the CBI's reserves.

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    7. Money comes into the CBI daily by several means. It is sent their by the banks; it comes in as mutilated currency; it comes in when a bank pays back a loan to the CBI. It comes in through the auctions as well. Getting the dinars back to the CBI is not a problem for the CBI, just as it isn't for any country in the world.
      Countries raise and lower money supply AT WILL all over the world. That is what the Federal Reserve DOES. They can use interest rates to raise or lower money supply. This is one of their main tools.
      However, in this case I have already explained the process. As the VALUE of the dinar rises due to increase attention on Iraq from the world, increased oil production, and many other factors, including speculation, at a certain point a 25000 dinar note will not be convenient to carry. It will be deposited in a bank, which will send it to the CBI, who will PAY for it in smaller denominated notes. Then the CBI will burn the 25000 note, thereby reducing the money supply. That may or may not be the MAIN method of reducing the money supply, but it WILL eliminate the three zero notes, which is a significant part of the process, as stated by the CBI. Furthermore, this is not an EVENT, but a PROCESS that will take up to 2 years, or more. The point is this: the CBI doesn't have to use dollars to get the large notes off the street unless it wants to. In other words, it doesn't have to PAY for them in any real sense. In fact, they've stated their intention: to EXCHANGE them. Since they are in charge of money printing, the cost is minimal in relation to the amount changed out.
      Again, this is a process. People will turn in their large notes when THEY want to, not because they are told to. In several articles Saleh stated that the current NID would remain legal tender "for a long time." In one article he referenced up to 14 years. Therefore, if an Iraqi wants to hide his 25000 note between the mattress, so what? It is still legal tender. Bottom line: it will all come back to the CBI voluntarily.

      The numbers I have used (33 trillion dinars and 33 billion dinars) are the ones the CBI uses when discussing this issue. This is the REAL money in circulation, which is the core of the problem. Electronic money is not at play here. All of the articles address the fact that there is too much money on the street and the inconvenience factor. Electronic money has nothing to do with this, which is why they don't use the other numbers that measure "money." It is really just that simple. They are talking about physical currency.

      Enorrste

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    8. FIrst the money supply certainly DOES include electronic money. Its all the same. When worn out notes come back to the CBI and they destroy them, that does not reduce the money supply as something had to be given for those notes, whether other notes or just credit in an account, the money supply is not changed by this. In order for such an act to reduce the money supply they have to be exchanged for dollars, but that reduces the reserves in exact proportion so nothing changes wrt the exchange rate. Likewise claiming that " It will be deposited in a bank, which will send it to the CBI, who will PAY for it in smaller denominated notes. Then the CBI will burn the 25000 note, thereby reducing the money supply. " is also wrong. 1 25,000 note or 25 1,000 notes are exactly the same thing as far as they money supply goes, it makes no difference at all.

      When they talk about removing the zeros so they won't have the 000 notes, that is talking about a redenomination where a NEW currency is issued not smaller denominations of the existing currency. That indeed will reduce the size of the money supply and raise the exchange rate for the NEW dinars only, the existing IQD exchange rate will not change due to this process (they both may change a little over time but not due to the RD).

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    9. Once again you misread what I wrote. What I SAID was that the CBI, when referring to 33 trillion dinars in circulation, is referring to the currency specifically. I also said that they are saying that THIS is what must be reduced (cash in hand).

      I listed only a sample of how the money supply can be reduced. There are many methods. One more is to issue bonds. Someone pays cash for the bonds, and the CBI gives them a piece of paper that says IOU. It takes the CASH out of circulation.

      Another is to raise the reserve requirements for banks. The CBI has already begun doing this. Here is an example:

      This is VERY uncommon, especially in recent decades. The reserve requirement is a percentage of deposits that commercial banks are required to hold on hand at any given time. Suppose your local bank has $100 million in deposits. If the reserve requirement is 10%, that bank must have at least $10 million in cash on hand at any given time. The remaining 90% of deposits ($90 million) can be loaned out. If the Federal Reserve raises the reserve requirement on banks (from say 10% to 20%), then banks cannot loan out as much cash, and this reduces the amount of cash in circulation and reduces the money supply.

      Just as the FED in the US has many methods to reduce the money supply, so does the CBI.

      I believe the value will raise and then the large notes will be removed. You believe the large notes will be removed, a new currency given in exchange (1000:1) and yet you can't explain a raise in the value, which is in most of the articles.

      I've tried to think it through from your point of view many times but come to a brick wall. I suppose it is possible that over a decade or so the value would rise, but the articles almost exclusively "link" the two together, as opposed to talking, for instance, about increased oil production as the "cause" for the rise in value of the dinar (although they DO do that as well). So, I'm open to a discussion on how the two can work together. It seems to me that the article I showed with the "then" in it is pretty straight forward. I've never seen an article that says "redenominate and THEN raise the value" but I have seen one that says "raise the value and THEN redenominate." If it exists, I'd love to see it. Of course with the latter being in print, the term redenominate takes on the second meaning (exchange the currency) rather than your meaning (LOP).

      Personally I think this is a very specific challenge. Perhaps you can all put your thinking caps on and find such a discussion in the media. But to say "everyone knows its a redenomination" even I won't deny, IF you define redenomination as an exchange of currency. And to say, "the media is full of talk about redenomination" even I won't deny, since I've seen many of them, if not most. But, again, it depends on what the term redenomination means.

      Enorrste

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    10. How many times does it have to be explained to you that a redenomination in itself does in fact raise the value of the dinar? It raises it in the sense that confidence it brought back to the currency and its market rate is stabilized. This is the only value raising they are ever talking about. Only GO RV of the brain would think that they are constantly talking about raising the actual exchange rate. This is something central banks do not do.

      And again your explaination on how they are going to remove 32 trillion 975 billion dinar while the whole time raising the rate up to $1 is completely laughable. Of course you convienently leave out the issue if trillions of electronic dinar and the issue of the trillions of dinar outside of Iraq that you insist don't matter. With your thinking Japan could print up a quadrillion Yen and send it to the US to back our reserves and not have to add it to their M2. Heck all countries all around the world fire up the presses because Mr economic degrees says its OK. What a joke.

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    11. "Once again you misread what I wrote. What I SAID was that the CBI, when referring to 33 trillion dinars in circulation, is referring to the currency specifically. I also said that they are saying that THIS is what must be reduced (cash in hand)."

      Electronic and physical currency are the very definition of fungible. Any effect upon one has to have exactly the same impact on the other. You can not possibly reduce 33T in physical cash to 33B, unless you also reduce the 42T in electronic cash to 42B. Does that really need further explanation?

      "I listed only a sample of how the money supply can be reduced. There are many methods. One more is to issue bonds. Someone pays cash for the bonds, and the CBI gives them a piece of paper that says IOU. It takes the CASH out of circulation."

      And I pointed out how in fact they do NOT reduce the money supply but you just ignored that. Selling bonds can indeed lower (not just slow the growth) of the money supply but only by tiny amounts not by the 1000x you claim is going to happen. Further given Iraq's instability they would have to offer a very high interest rate to find any buyers and this puts their future at risk so I doubt very much they will do so.

      "Another is to raise the reserve requirements for banks. The CBI has already begun doing this. Here is an example:"

      No you don't understand this. Raising the reserve requirements for loans by commercial banks can slow the growth of the money supply but it can not reduce it. It also slows the growth due to slowing the issuing of loans, not due to the increased amount in those reserves as those reserves are indeed part of the money supply (see http://www.federalreserve.gov/faqs/money_12845.htm "There are several standard measures of the money supply, including the monetary base, M1, and M2. The monetary base is defined as the sum of currency in circulation and reserve balances (deposits held by banks and other depository institutions in their accounts at the Federal Reserve)" ).

      Any reference you see to "trillions to billions" is talking about a redenomination. That is where a new currency is used that has (in the 3 zero case) 1000x lower demoninations and a 1000x higher exchange rate. Sometimes that is what is meant by raising the exchange rate as indeed the new currency (likely called the IQI) will have a 1000x higher exchange rate (the exchange rate or the existing currency remains unchanged). I agree that this looks to be off the table at least for 2013. Maybe they will do it in 2014 (it does not have to start on the beginning of a fiscal year or have an disruption in the financial system as both currencies exist side by side). Maybe they'll never do it (South Korea never has and their economy boomed). But an RD is the only way you get the trillions to billions effect.

      The other meaning of "raising the exchange rate" refers to the CB's desire to get the street rate (e.g. 1280 per 1 USD) up to their target rate of 1166 per 1 USD.

      The idea that the exchange rate on the current currency will just "slowly" grow by 1000x over two yeas is simply nonsense. This would mean a 33% rise every month! As an example of that scale of a rise, China has increased their value due to pressure from the west by about 25% and it has taken them 8.5 years (they started in Jan 2005).

      Delete
  34. Sam, thank you for reminding me of my "misses."

    As you know this is a moving target. Things change. If I say today that it will rain tomorrow and then it doesn't rain, it does not mean that I am trying to deceive the public, as you all would surmise. It means that things changed, or didn't change, but that in any case it did not rain.

    NO "INFERENCE" CAN BE MADE, PERIOD.

    Unfortunately, people on your site find it quite easy to impute motives into the words of others (along with nasty epithets). It shows a lack of professionalism and decency and betrays a weakness of character at the core.

    Most people who engage in spirited discussions stay "on track" with the issue at hand, unless they cannot defend a position, at which time they resort to ad hominem arguments. The Obama campaign did this quite effectively, incidentally, so I am not so naive to think that it can't work.

    But in this case, only Brian has brought to the table data to defend his position. He offered numerous quotes that show that a redenomination is in the cards. Unfortunately none had links so I could not determine the context without more searching on each one separately. However, I addressed it as best I could by trying to explain that we both see "redenomination" from different points of view (either a LOP or a currency exchange). That is the fair way to debate.
    Similarly, he pointed out my error on "pips." Unfortunately, however, rather than giving me the benefit of the doubt or trying to determine what I MEANT, he decided to once again attack me personally as unqualified to talk on this subject.

    Perhaps you are all so mired in your "technique" that you fail to see how infantile your methodology is. Instead of just meeting me head to head (mano e mano) on the issue, you continually deflect and attack me personally. It shows a lack of respect, on the one hand, and a lack of sincerity, on the other.

    Either you are able to defend your position point by point, as I attempt to do, or you are not. If you are able, then why not do it? If you are not, then it is understandable that you would resort to the ad hominem technique.

    In either case, you don't, and that tells anyone who is reading this more about you than about me.

    I have NEVER attacked any of you personally. I don't know you and have no right to "spew", as Damarck uses the word, my own personal views onto you as if I were some sort of psychic.

    The simple fact is that I present my case well. You obviously don't like what I have to say, but that doesn't mean that you should impune my motives, call me a liar, or otherwise disparage me personally. To do show only betrays your own weakness, not mine.

    I suspect that the vast majority of your audience, unless it is just the 5 or 6 of you, are sympathetic to your methodology and relish the ad hominem attacks. In other words, this site really isn't about finding any truth, now, is it? It's about character assassination. In that sense your site is quite successful.

    On the other hand, should you ever decide to step up to the bar where the REAL debaters engage in spirited discussion without resorting to your low-life techniques, let me know.

    I doubt I will get an email.

    Enorrste

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    1. Steve, to use your weather analogy, you don't say "I think it might rain tomorrow" or "I think there is a very high probability of rain tomorrow" you say "it MUST rain tomorrow". Then of course tomorrow is bight and sunny without a cloud in the sky An inference from that can indeed be drawn.

      and I have indeed engaged you on the issue of how the money supply would be reduced, so lets see if you can offer a sound explanation.

      Delete
    2. Steve - "I suspect that the vast majority of your audience, unless it is just the 5 or 6 of you, are Steve - sympathetic to your methodology and relish the ad hominem attacks"

      Spoken like a deeply embarrassed pumper desperate to avoid accountability for making deliberately false and misleading past claims that have been aired for all to see the quality result of "7 years worth of diligent research"...

      Steve - "Similarly, he pointed out my error on "pips." Unfortunately, however, rather than giving me the benefit of the doubt or trying to determine what I MEANT, he decided to once again attack me personally as unqualified to talk on this subject."

      You made the same "mistake" on the pips - not once - not twice - but in four separate posts. And that's just here. A Google search shows you confusing pips with points on DV and other sites too ("4 pips from 1170 to 1166"). It was clearly not a one-off typo no matter how much you frantically pretend it to be - you have shown you genuinely know nothing whatsoever about Forex trading or currency valuations beyond projecting your inner fantasies onto systems you simply do not understand, and when you are corrected - you then pretend you just "noticed" your "typo" when in fact it's obvious you're learning as you go, trying not to look embarrassed...

      I'm not going to feed your ego with a series of further exchanges, because I know that's exactly what you pumpers relish - "playing the victim" at every opportunity with a "poor me" mentality whenever someone embarrasses you by quoting your past blatant pumping and hold you accountable to your 100% perfect track record of failure at getting ANY prediction right despite making weekly posts year after year. Seen it all before - as soon as someone starts posting a string of failed predictions - out comes the pumper with his trademark feigned indignation of "haters! haters!" It's so predictable I could have almost written it for you...

      Plenty of "inference" can be made when you come out with "2-29-2010 Iraq will RV at $2.65 by March 1, 2010 or the budget has no credibility" and "Shabs said in July 2010 that 70% of the large notes were removed, so 27 trillion dinar was already reduced to 8.1 trillion at that time"

      Shabibi said no such thing. You lied. Yes, you lied. Pumpers putting words into Shabibi's mouth said that - not Shabibi - and now look complete and utter fools given Iraq now has 30% MORE banknotes in circulation than before it was supposed to have "shrunk by 70%"... I remember that "70% of notes taken out" quite clearly - it originated from Dinar Daddy's Tidbits - and this appears to be the pinnacle of the "quality" of your "intel"...

      "On the other hand, should you ever decide to step up to the bar where the REAL debaters engage in spirited discussion without resorting to your low-life techniques, let me know."

      Is that anger I detect? Rage at Sam posting your own 100% total prediction failure? Too bad. That's what this site is about - gathering together all pumpers past predictions and showing what clueless frauds they are under all the feigned "I'm privvy to a secret" ego-front-act they put on. You can't even predict the future two weeks ahead let alone two years. And here you are telling everyone about "pipping by 2015" (and getting your maths on that wrong by a factor of 1,000x in the process), seriously expecting people to keep unquestioningly lapping up the same recycled cut-and-paste BS.

      No you won't get an e-mail - for the same reason Charles Ponzi or Nigerian Prince scammers won't get one - waiting to "debate the truth" of what they're selling... We can see exactly what you're selling. You're a total fraud.

      Delete
    3. Welcome back, Steve. The problem as I see it is not that the target is moving. The problem is that you don't know what the devil you're talking about, which is exactly why I wrote this article. Currencies don't RV (or float up or whatever) 100,000% in value, especially currencies in an unstable country like Iraq. And the CBI's plan is nothing remotely like what you've been telling people for the past few years. I don't know what your motives are and quite frankly I don't care. What matters to me is that tens of thousands of people are being misled into believing that this currrency that is headed for demonetization is being touted as a ticket to happyland, which it most certainly is not. And as for your assertion that I made a personal attack on you, I never called you a liar or questioned your motives. What I did was present the dinar community with your track record. I think that's only fair given that you're presenting yourself as somebody with some expertise in this area. If you don't like being held accountable for your words you have a couple of choices. Either get it right, or don't put it out there. Good day, sir.

      Delete
  35. I just gave you the explanation you requested. It is above.

    You are doing the same thing that Brian did on "pips." Why do you have to parse this so much? I said what I meant to say (It's going to rain tomorrow), not "It might rain" in order to compare it to my statements regarding the dinar. So, you change my words and then try to make it as if I were the one making a bad comparison. My comparison was quite direct. And the only inference you can draw is that I was mistaken. NOTHING ELSE.

    Either way, it says NOTHING about my motive. I was mistaken. It's a moving target. So what? Have you NEVER said something that didn't turn out the way you thought it would?

    This is the problem with the internet in general. It allows things that normally would have fallen by the wayside (as in a casual conversation) to be called up years later and then used against them. I would suspect that if I had access to your "chats" over the last several years that I'd find some "dirt" as well. So what?

    Being "in the public" is what we are talking about here. I'm not running for President, however. And, FINALLY, none of this says anything about me personally except that I was mistaken. But you guys seem to think that it says a LOT about me, my personality, my education, my intelligence, my attempt to screw people for personal gain, and on and on and on.

    Well, you now are mistaken. You don't know me or what motivates me. All you know is that I was mistaken. Let it go.

    Why do you people do this? Can't you just take it as it is? Read what I wrote to Sam above. You are a perfect example of the technique. It makes YOU look small.

    Enorrste

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    1. and I just showed you why your explanation is bogus it also is above.

      Being mistaken in your opinion about what might happen is one thing (it ignores the clear fact that huge RVs don't exist but ...), but being mistaken over and over and over for years about what you say MUST happen is a different kettle of fish.

      Delete
  36. Get ready for the Redenomination of the iraqi dinar folks ! :P

    i have been in this for 5 years and during the first year i thought this was a good speculation that would make me money then i started to do my own research on currencys and found out this does it sound that good anymore when they talk about deleting the zeros aka Redenominating so i sold off my millions and now i only hold 1 25k note as a souvenir.

    ReplyDelete
  37. This article from just a couple of months ago may give you all time to pause. It may also make our discussion about the meaning of redenomination a moot point:

    Iraqi Central Bank: No intentions to strike out zeros from the currency
    26-04-2013 - 13:00 | Source:

    Editor: Ghassan Hamed

    Iraqi Central Bank expressed on Thursday that it does not intend to restructure Iraqi currency of strike out the three zeros, denying any news pertaining to Iraqi Dinar redenomination .

    “Some media stations reported statements that the Central Bank was thinking about restructuring the Iraqi currency and striking out the three zeros”, said the bank in a statement of which Alsumaria got a copy. It added “the Bank, considered to be the only authority or reference to make such statement, points out that we have no intention to restructure currency or strike zeros out”.

    Local news stations have reported a few days before that currency restructuring and removing zeros will soon take place considering that this will lead to promoting currency exchange and international economic transactions, in a new development on the Iraqi currency forefront.

    The general secretariat of the cabinet announced on April 12 that it will carefully reconsider striking out zeros which entails suspending all monetary activity until further notice.
    Some economy experts consider that Iraq is not ready at the time for striking out the zeros from the Dinar, pointing out that such operation required security, political and economic stability.

    http://www.alsumaria.tv/news/75116/iraqi-central-bank-no-intentions-to-strike-out-zer/en

    Now, the CBI itself has said that a "redenomination" is not on the table. In other words, it doesn't matter how you define it; it just isn't going to happen. In particular, then, you LOPsters have lost your case entirely.

    I, on the other hand, still have my case. It seems clear now that the plan is to raise the value of the dinar through normal market forces, as I have said. In time, presumably, the large notes will disappear through wearing out or being deposited in banks, where they will become electronic money. The result will be that, in time, the CURRENCY money supply will drop, as they have stated. In addition, the meaning of "remove the three zeros" will be shown to have NOTHING to do with redenomination at all.

    Therefore, all of the quotes given by Brian in an earlier post in his attempt to prove that redenomination was "just like Turkey did" are superceded by this one, definitive, article from the CBI which is only 2 months or so old.

    I welcome your responses. Since we no longer need to talk about redenomination, perhaps we can stick with "raise the value" and "remove the three zeros."

    Oh, wait, you don't care about that, do you. You just want to put down people who don't buy into a LOP. Well, your LOP just went down the toilet. Now what will you chat about?

    Enorrste

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    1. ROFL!!! Your April article is old news - from the same report on same date from original Arabic:-

      "The Central Bank said there is no intention of structuring currency and delete zeros this year."
      http://www.azzaman.com/?p=32404

      Nice of you to finally catch up and realize that the Dinar's value isn't going anywhere at all contrary to your incessant lies told on other forums - you know - like this one (another one for your collection, Sam):-

      "In fact, we expect it to reach $1 by the end of this year, 2012." - Enorrste, Sept 17th, 2012
      http://newiraqidinarexchangerate.com/dinar-guru-updates-dinar-guru-91712/

      Laughably, you hallucinate and twist around "we aren't doing anything with the Dinar in 2013" to somehow mean "Iraq will RV in 2013!!!" but it actually says nothing of the sort (either in English or Arabic) - it says NOTHING will happen with the Dinar and it will will carry on "as is" at its current rate, which actually debunks your own BS about "Iraq is going to do x later on in 2013, and within two months it'll be worth $10, blah, blah")... You've actually ended up proving yourself wrong as YOU were claiming it would do this and that in 2009, 2010, 2011, 2012, 2013, but no-one here has ever said "Iraq will definitely lop in 2013, blah, blah" pumper style.

      All you've done yet again - is crayon in "Go RV!" words that simply aren't in the articles you quote. The article you quoted said nothing - NOTHING - about changing its value at all. In fact it said the opposite - that the CBI are doing NOTHING with it this year.

      You just don't see it do you? You've told so many lies about the "RV" in the past, that you simply cannot see each lie you tell you lose further credibility. After 50 failed predictions, no-one cares what "interpretations" you "believe" any more. This is pumpers biggest failing - they genuinely believe they "deserve" the same amount of attention / credibility / respect after the 1,000th lie than the 1st lie. You are so used to lying you don't even see it as lying anymore.

      You need to read this.

      Delete
    2. If I were to tell you that I am 20 years old, that would lying. I am not 20 years old.

      You accuse me of lying in several of your posts, when, if you are at all intelligent, you know is a misuse of the term. You have even been called out for doing so many times by me, yet you persist.

      This betrays to me something in you that is sad. Either you suffer from a paucity of vocabulary, or you don’t know what the word “liar” means, or you find that degrading another person gives you a good feeling. At least one of the bloggers on this site had the bravery and honesty to admit that this is exactly what he does and that he enjoys it.

      You, on the other hand, pretend to engage in an intelligent conversation but find yourself unable to do so. Instead, you devolve in retributive babble that only shows your weak mind. Unfortunately, Sam, who thinks you are “brilliant”, must suffer from the same malady.

      You could have pointed out that there are other translations of the same article that have “at the current time” or “this year” included in the translation. But then that would mean that you’d have to deal with the content of the article directly.

      Instead, no less than 5 times you call me a liar (“incessant lies,” “you’ve told so many lies,” “you simply cannot see each lie,” “than the first lie,” and “you are so used to lying”) even though you probably know that a lie is an obvious telling of something that one knows to be false.

      Now, reporting exactly what I see in an article is not lying. Furthermore, if the same article states something slightly different, that does not mean that I lied by not reporting it. I did not see it. That is not lying.

      More importantly, however, is your failure to deal with the import of the article even with “this year” included.

      You have accused me of saying, putting the words in my mouth, "Iraq will RV in 2013!!!" when in fact I have written at length that the RV is now off the table. Remember, I’m the “free float” guy?

      However, to your own discredit, you do the very same thing you have disparaged me by saying, “it says NOTHING will happen with the Dinar and it will carry on "as is" at its current rate.” Oh, really? Where does it say that?

      Here is what it says: “the Bank, considered to be the only authority or reference to make such statement, points out that we have no intention to restructure currency or strike zeros out”. Even adding “this year” it is clear that you have read into this statement something that simply isn’t there. And yet you claim that this is what I am doing. Can you point to the place in their statement where it says they will do NOTHING? Can you point to where it says that the rate will NOT CHANGE? Of course you can’t, because it isn’t there.

      What IS there is exactly what I said: No REDENOMINATION. The fact that “at this time” or “during the current year” or “this year” is added does not change the FACT that for the foreseeable future there is NO REDENOMINATION.

      This is what you refuse to deal with, because it takes your theory out of the picture (for now). What it DOES NOT DO is remove my view from the picture. The dinar may rise, or may not. The CBI simply does not say. My view is that it will. However, your view, that the RD comes first, is now out of the question. Only time will tell if I am right, but the preponderance of articles talk about a rise in the value of the dinar soon, so we’ll see. The ONLY way you will be proven right is if they RD at 1000:1. After that, a LOP of 3 zeros is probably impractical.

      So we will see who is correct in due time. If the dinar rises in value, then I’m right. If they RD at 1000:1 then you will be right. If, on the other hand, it passes through 1000:1 and continues to rise in value, then the only meaning for RD will be “restructure the currency”, incidentally the same phrase used by the CBI in the article in question. Then RD almost certainly would refer to the exchange of the NID for a new currency.

      Now, can you address this intelligently without calling me names?

      Enorrste

      Delete
    3. Why do folks (like me) claim you are a liar? Well because of two things. 1) you claim you have studied all these issues for years, yet 2) you make mistakes that would not pass a weekly quiz in currency 101 in junior college. e.g. Your claim that when a central bank destroys a worn out note it reduces the money supply, or that its only the physical currency that matters (m0) and not the electronic currency (m1 and m2). It doesn't add up. If after years of study you do not understand these simply aspects of currency then you are pretty stupid and really should not be giving advise to anyone on anything related to currency. But I don't think you are that stupid, I think you understand it perfectly well, how could you not do so as its just not very complicated. Your goal appears to be to twist the facts in whatever way is necessary as long as the outcome points to a huge rise in value.

      Delete
    4. As I said above, a lie is an intentional distortion of the facts as you know them. I have not done that. I was unaware that the translation that I read left off "this year." That is hardly a lie.
      I did not lie when I said I have studied this for years. I actually have a book on line about the dinar history. That being said, this story has changed more times than a nurse in a baby ward. Things are moving constantly, so something said one day may not be the same a week later, and almost certainly won't several years later. Therefore, it is not a lie to state that I have studied it. Clearly I've been on the net talking about this for several years, so how could that be a lie?
      In my last post I noted a "mistake" made by the same person who claimed I was lying. That doesn't make him stupid or a liar. It means he made a mistake. The statement did NOT say what he says it says. But I don't question his intelligence or motives because he is mistaken, as you would.
      When bills are destroyed those bills are removed from the money supply. How could that not be true? Do you have any burned bills in your wallet? Remember, the CBI doesn't have to always give a dinar to get a dinar. They can get them through other means, remember? For instance, if they give a dollar for dinars, and then destroy the dinar, that would reduce the money supply. If they sell a bond for dinars, then destroy the dinars, that would reduce the money supply.

      Let me ask you a question: how DO they reduce the money supply? Clearly RD is one answer, but very few countries have used that. Yet money supplies go up and down all over the world all the time. How could they do that?

      Did I ever say that ONLY currency matters? No, I didn't. What I said was that when the CBI talks about 33 trillion dinars it is referring to currency in circulation. The articles are referring to money in circulation, not the total money supply as measured by all means. It is you guys who bring up M1, M2, and M0, not me. Neither does the CBI. Did that ever occur to you? Of course they exist and are published, but I have always referred specifically to the 33 trillion dinars that Saleh and others said is causing a problem in commerce due to the difficulty in handling so much MONEY. By attempting to deflect me into supposedly saying what I never said, you prove nothing.
      Your last sentence is, of course, your opinion. If I were to allow myself to lower myself to your level of discussion I could certainly do so. You all offer a great deal of fodder for me to chew over. But what is the point? I have no desire to belittle you personally. I have much more important things to do than to relish the "glory" of finding an error and then exploiting the PERSON behind the error as if he were an idiot. Why would I lower myself to that level? What could be gained?
      I often wonder if you guys ever think about how you are being perceived by others, if there even ARE others. I couldn't easily live with myself if I saw in a mirror myself acting as childishly as you all do. I'm just surprised that my attempts to wake you up to your infantile statements and personal attacks fall on completely deaf ears. Any sentient person would see that from any outsider's point of view that I hold the high ground morally speaking (even if the content specifics are not accepted). I do not attack you because I disagree with you. I attack your point. None of you, thus far, has been able to do that without throwing a jab at me personally. How weak is that?

      Oh, you failed to even mention my challenge in the last post. That is the point, remember? No RD for the foreseeable future. But a possible raise in the value. Once past 1000:1 the RD slips into oblivion if it isn't acted upon by then. Or, as I suspect, its meaning isn't LOP after all.

      Enorrste

      Delete
    5. "When bills are destroyed those bills are removed from the money supply. How could that not be true? Do you have any burned bills in your wallet? Remember, the CBI doesn't have to always give a dinar to get a dinar. They can get them through other means, remember? For instance, if they give a dollar for dinars, and then destroy the dinar, that would reduce the money supply."

      No. ALL dinars in the CBI are out of the money supply. It doesn't matter if they burn them or have warehouses full of them. They are the issuer of the dinar so how many they hold makes no difference to the money supply. When someone turns in a worn out bill they either get other bills in its place (so M0 doesn't even change), or they get a credit to their account (so M0 goes down but M1 remains the same as the electronic component of M1 goes up the same amount that M0 goes down). If the CBI pays dollars for IQD, then indeed those IQD reduce the money supply (whether they burn them or not) but the loss of dollars reduces their reserves by exactly the proportional amount so it makes no difference to the exchange rate.

      "Let me ask you a question: how DO they reduce the money supply? Clearly RD is one answer, but very few countries have used that. Yet money supplies go up and down all over the world all the time. How could they do that?"

      Its extremely difficult to shrink the money supply by a significant amount. Doing so by even a few percent is very rare. You say they go up and down all the time, can you offer evidence of significant drops in any country's money supply? It can go down (again by a few percent) in VALUE, as the exchange rate changes, but the size going down is very difficult.

      Here is exactly what you said about M0 Vs M1 and M2 "The numbers I have used (33 trillion dinars and 33 billion dinars) are the ones the CBI uses when discussing this issue. This is the REAL money in circulation, which is the core of the problem. Electronic money is not at play here. All of the articles address the fact that there is too much money on the street and the inconvenience factor. Electronic money has nothing to do with this, which is why they don't use the other numbers that measure "money." It is really just that simple. They are talking about physical currency."

      Note "Electronic money has nothing to do with this". Utter nonsense. Anything that happens to the physical currency as far as its value must likewise happen to deposits, its all dinars. A dinar is a dinar is a dinar. They all have the same exchange rate, they are all in they money supply, they are all a liability to the CBI.

      "That is the point, remember? No RD for the foreseeable future. But a possible raise in the value. Once past 1000:1 the RD slips into oblivion if it isn't acted upon by then. Or, as I suspect, its meaning isn't LOP after all."

      You think the exchange rate is going to go up to 1000:1 from its current 1166 to 1? A 14% rise would be huge, but suppose it happens, how does that make an RD slip into oblivion? Suppose the rate (this will never happen but just for the sake of discussion) goes to 900 IQD to 1 USD, then a 1000:1 RD would put the NEW value at .9 IQI to 1 USD or 1 IQI for 1.11 USD, while the IQD stays at 900 to 1USD or 1 IQD for .0011 USD, what's the problem?

      Delete
    6. Note that if I recall there are some months were M1 goes down for Iraq, but then it goes back up. This is just due to the auctions (dollars out and IQD in, so M1 lowered and reserves lowered) being out of sync with the MOF (oil revenues) exchange of dollars in and IQD out to get IQD for the budget. But this is a change that makes no difference relative to the exchange rate as dollar reserves and IQD supply go up and down in perfect lock step.

      Delete
    7. Steve - "As I said above, a lie is an intentional distortion of the facts as you know them."

      ...Which is exactly what you've been doing in almost every single post you've made - both here and other posts from other forums - deliberately and intentionally distorting quotes to pretend they say thing they clearly do not to deliberately mislead your followers. That's why every prediction you've ever made has turned out 100% wrong, week after week, month after month, year after year - what you are speaking is as far removed from the truth as is possible. As I said - your real problem is you've told so many lies for so long, you simply just don't see making false claims & promises as lying anymore and have ended up believing your own propaganda, and almost everyone can see it except you and a few of your guru cult followers....

      Delete
    8. John,

      Thank you, first of all, for your professionalism. It is truly a breath of fresh air.

      I apologize for the delay in responding. I just watched an uncut Director's version of "Gods and Generals" about the Civil War. It was 5 hours long. The sequel is "Gettysburg" which lasts 4 1/2 hours.

      I am preparing my response remarks to you now and will either upload them later tonight or tomorrow morning.

      Enorrste

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    9. Brian,

      More hyperbole ("almost every single post you've made"). How about "many of your posts"?

      Then again imputing motives to me that you don't know I hold ("deliberately and intentionally distorting quotes to pretend they say thing they clearly do not to deliberately mislead your followers.") How is it that you know what I am thinking?

      Then of course you again attack me personally ("your real problem is you've told so many lies for so long"). Of course that is your conclusion given the fact that your definition of a lie is "anything that comes out of Enorrste's mouth." With that definition you are absolutely correct.

      However, you have added nothing to the discussion, again, with this post, except to try to raise yourself on a pedestal and lower me into a hole. Well done!

      Enorrste

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    10. There are several monetary policy tools available to achieve a reduction in money supply: increasing reserve requirements; reducing the monetary base; and increasing interest rates by fiat. All have the effect of contracting the money supply.
      The reserve requirement is a central bank regulation that sets the minimum fraction of customer deposits and notes that each commercial bank must hold as reserves (rather than lend out). These required reserves are normally in the form of cash stored physically in a bank vault or deposits made with a central bank.
      The reserve requirement can be used as an instrument of monetary policy, because the higher the reserve requirement is set, the less funds banks will have to loan out, leading to lower money creation and perhaps ultimately to higher purchasing power of the money previously in use. There is also a multiplier effect in fractional banking. In a loose monetary policy this means more money can be lent out by the banks. But there can also be a reverse multiplier effect, since raising reserve requirements reduces the amount that can be lent, and with a fractional banking system loans must be reduced at the same reversed multiplied rate that they were originally created.

      In 2009 the reserve requirement in Iraq was 25%. In April of 2010 it was reduced to 20% and again in August of 2010 it reduced the requirement to 15%. All of this had a positive effect on economic growth in the country, but it also increased the money supply. According to the CBI it went from about 25 trillion dinars to 33 trillion dinars. This all occurred during a period when the exchange rate remained stable. With release from Chapter VII, it is highly likely that the economy will soon start to heat up significantly (http://www.iraq-businessnews.com/2012/04/22/iraqs-banking-changes-could-unleash-economic-potential/). This will force the CBI to tighten up again. One of their tools will be to bring the reserve requirement back up to where it was in 2009. The effect would be a drop of money supply by 8 trillion dinars even without a change in the exchange rate (just reversing what happened before).

      This is the first part of my response.

      Enorrste

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    11. In addition, the current plan in Iraq is to increase the number of banks around the country dramatically. International banks such as Citibank and Chase are already bidding to enter into the banking market inside Iraq.

      The result of the increase in number of banks will be that there will be a reserve requirement in each of these banks. In other words, deposits made will first have to satisfy the reserve requirement of a bank before it can be lent out by the bank. With major worldwide banks entering the market we can reasonably expect very tempting offers to be made to potential depositors to get the cash into the bank’s vaults. The effect of this will be a de facto reduction in the available money to the public, thus reducing the money supply that concerns Saleh and the CBI (too many bills on the street, cumbersome to do commerce, etc.).

      This is the second part of my response.

      Enorrste

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    12. In economics, the monetary base in a country is defined as the portion of the commercial bank’s reserves that are maintained in accounts with their central bank plus the total currency circulating in the public (which includes the currency that is physically held in the bank’s vault).
      The CBI has the power to increase the monetary base at will. To the extent that the proportion of the monetary base changes (i.e., reserves increase or total outstanding currency decreases) the money supply that Saleh talks about will be reduced.
      The CBI can also affect the money supply through fiat changes in the interest rate. That rate is currently 6%. While that would be considered high in America today, for a burgeoning economy about to explode it is reasonable to expect the rate to go higher as the economy starts moving upward. In the US we saw interest rates at 12% in the late 70s and early 80s (with 22% car loans!) caused intentionally by Reagan to release steam from our booming economy.
      Raising the Central Bank interest rate (the rate at which commercial banks can borrow from the CBI) will reduce the money supply.
      These three factors alone could enable the CBI to significantly reduce the money supply over a 2 year period. However, this discussion has assumed a static exchange rate. Once a freely floating exchange rate enters the picture, assuming that it will, the situation changes significantly in terms of the CBI’s ability to reduce the money supply. While there is a relative parity now between the money supply and the rate, as both you and Brian have stated, an upward pressure on the exchange rate will enable the CBI to reduce the money supply, its stated plan. The simple truth is that the CBI reserves have consistently grown during the last several years while the exchange rate has not changed. If there was parity, then, in 2009 when reserves were at about $50 billion, then what exchange rate would be at parity with $75 billion in reserves (assuming no change in money supply)? Admittedly the money supply increased during that period from 25 trillion dinars to 33 trillion dinars. But the reserves went up 50% while the money supply went up only about 30%. Therefore, it appears that there is a good deal of room for the exchange rate to go up once a free float is announced. We know this to be the case because at the current rate of 1166 to 1 and a 33 trillion dinar money supply (worth about $30 billion) the $75 billion in reserves have the money supply covered by 250%. Therefore, in theory, the exchange rate could move up dramatically and still be considered “strong” in an international sense. Even if the money supply did not change at all, the exchange rate could go up 250% from 1166 to 1 to 460 to 1 and there would still be 100% coverage of the money supply.
      This is the third part of my response.

      Enorrste

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    13. Going one step farther, the release of gold and other funds around the world that have been held under the Chapter VII restrictions could increase Iraq’s reserves significantly. I don’t know how much that amounts to, but have read that it could be $75 billion. This would allow an even higher exchange rate.
      But there is more. Iraq has stated that over the next few years their oil production will increase dramatically. This, too, will bring in billions, potentially, to the CBI reserves, which, again, will allow for an even higher exchange rate.
      With a rising exchange rate, then, a domino effect begins. More investors want to climb aboard the rising currency, as well as get into Iraq to invest in the infrastructure. More banks enter the market which means more reserves are required. Economic growth may require some tightening from the CBI (increased interest rates), and so on.
      This effect can snowball in a fairly short time frame. All of this activity allows the CBI to reduce the money supply, which is their stated intention. Furthermore, as I just noted earlier, this activity will allow for a rise in the exchange rate even WITHOUT a reduction in money supply. Combining the growth with a reduction in money supply will allow for the rate to rise just that much faster.
      None of this requires a “redenomination.” Perhaps that is why the CBI stated that an RD is not in the plans at this time.

      This is the fourth part of my response.

      Enorrste

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    14. Steve - "How is it that you know what I am thinking?"

      Because you've demonstrated it over and over, here & elsewhere. Google is a horrible thing if you're pumper as it shows up clearly exactly "what you are thinking" when 300 posts over several years are put together side-by-side & "the dots are joined" - contradictory & blatantly false claims that pumpers desperately want everyone to forget they said & get REALLY upset about when they get aired in public. That's why censorship is rife on pumper-run forums like DinarVets - not for "abuse" but for "daring" to show the pumper is a liar with their own words, false claims and mis-quotes.

      Dinar Guru's act like infallible cult leaders - you'll accept debate (if you can call silly word redefinitions & doublespeak "debate" which is what your whole argument' is based on) on some of *what* you believe, but you go beserk when people start looking at the deeper issue of *how* you control & shape your followers opinions, *how* you deliberately pass off a personal fantasy as "an official CBI statement of fact", and *how* you deliberately & persistently mis-represent people with a whole variety of underlying propaganda & Red Herrings, then act like criticism of propaganda is some "vicious personal attack" on your whole family by "outsiders" out of sheer embarrassment at not only being shown up to have not gotten ANY prediction right over YEARS of posting, but also at being shown up to be highly manipulative in general.

      Steve - "Then of course you again attack me personally"

      As I said earlier: "That's exactly what you pumpers relish - "playing the victim" at every opportunity with a "poor me" mentality whenever someone embarrasses you. As soon as someone starts posting a string of failed predictions - out comes the pumper with his trademark feigned indignation of "haters! haters!"

      Its not your beliefs that are under attack (they've merely been debunked) - it's your chronically dishonest propaganda underlying those beliefs attacked - and rightly so:-

      Enorrste - "The 2013 budget will be based on the new rate", "the 2013 budget…takes effect 1/1/2013, so they must do the RV prior to that", "We…have the clear statement from the CBI that the process of “removing the three zeros” is essentially completed inside Iraq.", "Therefore June 2012 is the drop-dead date for the RV"

      These are not "I, believe..." opinions, these are your false "absolute statements of fact" - and a deliberate false statement of fact is indeed a LIE - especially repeated over & over, whether you're emotionally mature enough to accept responsibility for persistently misleading people or not.

      For all the huff, puff and feigned "pumpers are honest victims" indignation, the bottom line is - you cannot accept any responsibility for your own past false statements & claims and failed predictions made whatsoever based on mis-quotes or even non-existent quotes, and like most guru's you seem to possess the holier-than-thou arrogance at believing you have some divine unquestionable right to endlessly never have your propaganda tactics & doublespeak ever questioned - even AFTER your string of predictions and "statements of fact" have been proven 100% wrong...

      What you call "abuse" is nothing more than deep personal embarrassment at having your dirty laundry aired for all to see and trying to silence valid criticism by falsely pretending you're a victim of "bullying" as an accountability diversion tactic. You've "lowered yourself into a hole" years ago with your own 100% failed predictions and above fake CBI quotes years ago before we even spoke for he first time.

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    15. Steve - There are several monetary policy tools available to achieve a reduction in money supply: increasing reserve requirements; reducing the monetary base; and increasing interest rates by fiat. All have the effect of contracting the money supply.

      Another load of economically illiterate back-to-front gibberish. "The money base can be reduced by reducing the money base". LOL.

      Increasing reserve requirements does not reduce the existing money supply as you claim - it simply slows down the rate at which banks can lend in future. All you've done is create a giant straw man by declaring that because the money supply simultaneously went up during Iraq's RR reduction, that latter must be 100% the cause of the former and is 100% reversible, which is total nonsense.

      If a bank is forced to hold more in reserves, it just means less money will be lent out in future - it slows down THE RATE OF INCREASE of money supply - it does not make all existing loans (let alone money) shrink by 99.9%. China increased banking reserve requirements, as have some Euro countries in response to "bad debt" crisis - and none of their money supplies went down at all.

      Iraq could have a 100% reserve requirement (a full gold standard) and it still wouldn't take even 10% of existing money out of circulation - it would just bankrupt all Iraqi banks overnight because they have nowhere near the reserves there to back their existing liabilities (let alone $78,000bn worth of gold for your fantasy)...

      If you raise reserve ratio's too much, then you end up with first a credit crunch, and then a Great Depression & liquidity crisis. No-one anywhere would be able to borrow ANYTHING - no loans, no mortgages, no business startups. Banks would close theirs doors to all lending, and confidence in the whole system, currency & economy would collapse and Iraq's economy grind to a halt. Your little fantasy is just that - a delusional fantasy as even 100% reserve ratios or 30% interest rates will not cause 99.9% of money to disappear or appreciate the currency 99,000%. It's just a giant "ME WANT!" straw-man based on your usual wildly misunderstood, grossly over-simplified Red Herrings.

      Same with interest rates - lowering them to near 0 will not do a thing - see the USA, Eurozone, 0.5%, etc, rates, and raising them will just plunge most of the nation into crippling debt and still won't take any existing money out of circulation, it would result in a national debt crisis and kill off budding economic growth.

      1980's 20% interest rates that you quoted didn't "shrink America's money supply" by even $1, it simply meant 80-90's money supply grew by only 130% instead of 200% (70-80). Higher Interest rates affect future inflation - they do not shrink the existing money supply at all.

      Steve - "The effect would be a drop of money supply by 8 trillion dinars even without a change in the exchange rate (just reversing what happened before)."

      You literally do not understand a single word of what you're saying. You're arguing the Iraqi equivalent of "a cut in the US budget deficit = not just a cut in all existing govt debt but also all existing money"! Of course it doesn't - as RR affects newly created loans - it doesn't make all existing loans or cash "disappear" no matter what the rate is! Interest rates are about kurbing high inflation - Future money supply growth.

      And in 2009, Iraq's money supply was $45tn. Today, it's $78tn. That's why the Dinar isn't worth 50% more with $75bn reserves today vs 2009's $50bn...

      Give it up Steve... All you've done is seriously embarrass yourself. You are not "graduate level educated" in economics at all - that much is blatantly obvious...

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    16. You do not know what I think. You only know what I say.

      You attacked me personally in every post except this last one. I did not play the victim. I have never claimed I was a victim and I resent the inference. You have no right. You are an extremely small-minded person who clearly cannot separate your emotional outbursts from a professional conversation. If you are married, I pity your wife. Do you beat her?

      My statements made in posts elsewhere are my opinion, and to those it was directed knew that. The fact that they are not proceeded by “I believe” or “it is my opinion” is totally irrelevant. After all, I was writing to a team of people who knew this already. Taken out of context, as you have, means nothing. Everything is my opinion, period. If I listened in to you talking at a dinner party and then quoted you outside that party, would you be offended? The fact that things change seems to slip conveniently through your fingers. If you are married, I pity your wife. Do you bring up every mistake she ever made when you argue?

      Because I state my opinion directly does not mean that I am being deceptive or lying. I’ve addressed this before. You have no right to infer my motives, ever.

      Who said I don’t accept responsibility for my last statements? Only you.

      Your “abuse” refers to your calumnious statements about me personally and your supposed psychic ability to know what motivates me, NOT what I have said. My statements are one thing. What you do is totally different, childish, unprofessional, and reveals the weakness of your own character. You just can’t seem to deal at a decent level in a conversational format without flying off the handle with ad hominem attacks. Your posts would be proof of your thinking much more than mine would be of my thinking, if that were even possible, which it is not. You clearly lack control.

      The monetary base is not synonymous with the money supply:

      “The monetary base should not be confused with the money supply which consists of the total currency circulating in the public plus the non-bank deposits with commercial banks. Normally, the money supply exceeds the monetary base by far; the ratio of the two is referred to as the money multiplier. If one excludes currency from the definitions, the monetary base is not a subset of the money supply - rather, the two are disjoint sets. On the commercial banks' balance sheets, the former belongs to the assets whereas the latter belongs to the liabilities.”

      We are clearly talking about a change in money supply in the future. Your comments are therefore irrelevant. I never said anything about some sort of “instantaneous” change.

      You continue to say that I call for an RV. I dropped that nearly 16 months ago based on statements made by the CBI that they would float the currency. Catch up.

      Interestingly you failed to address your own mistakes:

      “it says NOTHING will happen with the Dinar and it will will carry on "as is" at its current rate…”

      “The article you quoted said nothing - NOTHING - about changing its value at all. In fact it said the opposite - that the CBI are doing NOTHING with it this year.”

      Should I save this and repeat it back to you in 3 or 4 years and then call you a liar? How about in 6 months?

      The exact method by which the CBI will reduce the money supply is unknown, even to you. While an RD would have this affect directly, it has been indefinitely postponed. There are other means available to the CBI, which was the import of my posts. The CBI has stated that they will reduce the money supply by 99.5%. I’m willing to wait to see how they do it, whereas you are adamant that they must do it with the single tool (RD) that they have removed from the table. How, then, will they do it?

      Enorrste

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    17. Steve - "I pity your wife. Do you beat her?"

      And now you reveal your true colors for all to see. I guess my post hit a raw nerve. You really don't like your lies being repeated back to you, do you?

      Steve -"The monetary base is not synonymous with the money supply"

      And 32.967tn out of 33tn Dinar banknotes will still not disappear because banks are told to lend 5% less and the Dinar will still not leap up 99,000% (whether overnight or over 2 years) just because banks are lending 5% less...

      Steve -"Should I save this and repeat it back to you in 3 or 4 years and then call you a liar? How about in 6 months?"

      Yes, please do Steve. Because as the CBI have said - nothing will happen "this year" (exact words in original Arabic untainted by pumper "accidental" mistranslation BS:-
      http://www.azzaman.com/?p=32404

      Yes, Steve, please do come back here on Jan 1st 2014. I insist... (You might want to add that gem to his profile Sam next Jan) ;-)

      Steve -"The exact method by which the CBI will reduce the money supply is unknown, even to you"

      It's a LOP - as they've said about 30 times now over the past 3 years. You just don't want to hear it, so you "pretend" they never said it. Keep living your lie my friend. They haven't "removed it from the table", they just said it isn't budgeted for "this year" (exact words in Arabic above)...

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  38. Steve your long winded whiney rants are telling and nothing more than a front used to avoid answering the relevant questions.

    OK.....let's put this in perspective. Your "view" is that the CBI has stated that they will remove 32 trillion 975 billion dinar from circulation within 2 years while slowly raising the exchange rate to $1 due to allowing it to float. As if all of this isn't laughable enough you say that they have said they would do all of this by saying that they will raise the value of the dinar to $1by removing three zeros and the process should take about 2 years. This is basically your whole stance and its obvious that you feel justified in using these remarks by the CBI as proof of the upcoming 100,00% RV.

    Our stance is that the CBI has Bern describing a basic 1000 to 1 RD and have even shown proof that you have chosen to convienently ignore. The CBI has indeed said they would raise the value of the dinar to 1 dollar by removing 3 zeros over a period of two years. A redenomination would first of all bring the value of the dinar on par with the dollar especially if they go to 1000 to 1 first. The move from 1166 to 1000 if the chose to do so would be one way of raising the dinar value and the RD itself would increase the value of the dinar because it wouldore than likely bring the marke rate back in line with the exchange rate. Second....it would in fact take two years because this seems to be the period that the CBI wants the two currencies to coexist. After two years the old currency will be demonitized. When they say the money supply will be brought to 25 billion then its obvious that this is the amount of physical NEW dinar that they will initially print. Electronic dinar will be dived by 1000 right off and isn't even mentioned in a lot of these articles.

    So.....now we have two senerios for people to look at an decide for themselves. One by Steve which is complete and utter economic stupidity derived from wishful thinking interpretations and complete ignorance of the workings of global currencies and one by us which is an actual economic event practiced around the world by countries in the same situation that Iraq us in with their currency being in a hyperinflated state. Plus we have shown actual proof that the CBI themselves is describing a common 1000 to 1 redenomination while Steve has brought articles to light that prove himself wrong and proves us right LOL. Either that he brings articles that are baddly interpreted so that he can spin them to mean the impossible event that he pumps. Either way it should be obvious to even the most braindead RV idiots who is correct.

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