It's been a month since I did a post, so I thought I should write something. The truth is there really isn't much to talk about. The "war" against ISIS isn't going well, but even if we could instantly eradicate them it wouldn't bring about any increase in the official value of the IQD. The leadership in Iraq is still trying to figure out who is in charge of what and how they're going to proceed from here. And of course the gurus are still saying "any day now".
I've been asked to comment on a couple of things. First is this Dave Schmidt guy. I've already given him two Douchebag of the Month awards. The guy is a serious contender for the 2014 Dinar Douchebag of the Year. For anybody who is on the fence about him check out the links below.
The second thing is the Zimbabwe dollar. Somebody emailed me telling me that the gurus are pumping it again and that it's a scam. NO KIDDING!?!?!?! I know the fact that the ZWD has a ton of zeros excites people at the possibilities of a revaluation, but you have to realize that the currency is valued that low for a reason. NOBODY WANTS IT! Nobody except for gullible speculators, that is. From Wikipedia:
"Despite attempts to control inflation by legislation, and three redenominations (in 2006, 2008 and 2009), use of the Zimbabwean dollar as an official currency was effectively abandoned on 12 April 2009 due to the skyrocketing inflation."
Just because something has a very low price doesn't mean it's undervalued. Toothpicks are pretty cheap too. Why not stock up on them? Maybe the Central Bank of Toothpicks will raise the value on them and you'll get rich! It makes about as much sense as buying Zimbabwe dollars. As one honest ZWD dealer says "ZIMBABWE CURRENCY IS DEFUNCT AND NOT LEGAL TENDER ANYWHERE.".
In closing, I'd like to direct you to a great post. Jay Adkisson from Forbes did an article called "You Can't Fix Stupid - The Iraqi Dinar Scam Lives" a couple of years ago, and every month or so he updates it with his thoughts on the dinar investment. This month he said, among other things:
"Sometimes currencies lose their value to
the point where the mere size of the bills means they have become
impractical. Thus, if you’re having to pay for a pack of smokes with a
Dinar-10,000 bill, things are obviously out-of-whack, and the government
has to re-denominate the currency so that the folks using the currency
don’t lose all confidence in it and start trading in some other
currency. That is what is happening to the Dinar.
But re-denomination of a currency does
not, repeat NOT, change its value relative to other currencies. What
actually happens with a redomination is that the government simply
issues new bills, knocking a few zeros off, and then sets a deadline by
which the old bills become worthless unless they are traded in by that
date. So, the local resident might take in their old Dinar-10,000 bills
and exchange them for new Dinar-100 bills."
http://www.forbes.com/sites/jayadkisson/2012/07/30/you-cant-fix-stupid-the-iraqi-dinar-scam-lives/ (Give the page a minute to load, and then scroll down to the bottom right before the comments.)
Now, lest anybody conclude that Jay talks about the dinar like I do, I assure you it's the other way around. Experts like Jay and John Jagerson are responsible for my epiphany. I learned what I know from them, from a few sharp guys who frequently comment on this blog, and from my own research. My thanks once again to Jay for his frank analysis of this scam. Until next time.