Thread: Iraq/Dinar News. 09/05 to 01/14/07

Old article but I thought it was interesting...

In Baghdad money market, dinar ignites bidding wars
Unregulated street trades fuel economic uncertainty

By Peter Hermann
Sun Foreign Staff
Originally published May 20, 2003
BAGHDAD, Iraq - Pushing through the pickpockets and gun merchants clogging Kifah Street, a few men huddle in tight circles and engage in frenzied bidding wars, trading piles of Iraqi dinars and American dollars.

The money-changers hold shopping bags bursting with bills. The men thrust their hands in the air and shout their prices. In lawless Baghdad, this is the money bazaar, part of a trash-ridden street where everything from eggs to night-vision goggles can be bought or bartered for and where the daily exchange rate is set for the dinar.

Unexpectedly, the unregulated market has helped the dinar rise in value. Two weeks ago a dollar could buy nearly 2,000 dinars; now it will bring 750 to 1,100, exchange rates not seen since 1996. It is striking that the currency - about the last item left that still has Saddam Hussein's face on it - is getting stronger while everything else is in a state of collapse.

Baghdad's Central Bank is flooded, surrounded by razor wire and guarded by American soldiers. There is no government, no monetary policy and no one at the helm.

"We have taken over," said Salah Hassan, a 29-year-old money-changer on Kifah Street. "We can do whatever we want."

The money traders give the same reason for the dinar's rapid rise: U.S. authorities have flooded Iraq with dollars, and the dollar is thus less rare and less valuable and gives the dinar its unaccustomed strength.

A stronger dinar should be good for Iraqis, but it has only caused further angst. About the only people working are being paid by the U.S. civil administration, and they are being paid in dollars, now worth less and less even though prices for food and gas in dinars remain the same.

Nobody knows how much money of either currency is circulating, and money traders agree that the dinar is vastly overvalued, its price determined by the guesses of street merchants, based on how many dollars they see each day.

"We need government control," Hassan conceded as he sold a stack of dinars - so many that instead of counting them, he weighed them. "There is enough money on this street for the budgets of two countries. If the situation continues like this, it will be chaos."

A few bank branches are doing business here, but tellers confine themselves to handing over monthly pensions to retired military officers. Savings and checking accounts are frozen; even the records are unavailable.

The downtown office of the Rafidain Bank, with its white pillars and enormous doors making for a grand entrance, is open. But customers cannot go inside. Instead, retirees line up at windows, where they are handed their $40 from tellers who have pushed desks against the inside wall and torn away screens to make improvised walk-up windows.

In the cavernous lobby, idle workers mill around waiting for their salaries, taking advantage of an air conditioner that works. The marble counter where tellers used to work is bare - no chairs, no workstations, no money. Account-holders desperate to get their savings have long since stopped making the futile trip.

Hamdiya al-Jaf, who manages

one of the branches in the upscale Monsour district, said customers' money and records are kept at the central bank, which is inaccessible. She comes to this downtown office because her branch was looted and taken over by squatters.

"Before the war, we were a very orderly institution," she said. "People came and got their money and went away quietly. Now, people are angry. Some threaten to kill us if they don't get what they want."

Iraqis are unable to get their own money and feel gouged by the money-changers, who have created what amounts to a false market in which the dinar can double in value or drop just as far in a matter of hours.

The Iraqi government used to regulate the currency, keeping the dinar's value at 1,500 to 2,000 to the dollar.

"It reflected to some degree the real value," Jaf said. "But until we get back in operation, we will continue to see these inflated rates. The situation is not stable."

Mathem Salman, 33, who runs the al-Bahja Exchange Co., near the Rafidain Bank, readily acknowledges that he is part of the problem. He used to buy and sell dinars based on the government rate. Now there are new rules. Each morning, Salman sends three armed workers to Kifah Street to trade gossip and then money.

"This is no way to run things," he said. "But we are forced to work this way."

How does Salman know that what his workers learn on Kifah Street is correct?

"I have no idea," he acknowledged. "The price comes from the market, but we really have no idea what the market is. We used to make money all of the time. Now, some days we gain, some days we lose. We're just happy to break even."

Kifah Street is jammed with people buying and selling, begging and stealing. It seems that everything is available here, including satellite phones and dishes, machine guns and bullet-proof vests. It is an electronics shop and military surplus store rolled into one outsized yard sale.

But money is the real action here. The money-changers line the center of the street, some with wooden desks and others with boards laid across milk crates, their piles of money stacked next to calculators and watched over by men with pistols.

How do the money traders know where the bidding should start? The market price, they say, is determined by wholesalers selling large amounts of goods, such as refrigerators or televisions, who come to Kifah Street with thousands of U.S. dollars to change into dinars.

There is no order and no one is in charge, just money-changers bidding furiously against one another.

"I'll take one hundred at a thousand," a trader shouts, wanting to buy $100 at the rate of 1,000 dinars to the dollar.

"Sold!"

When the traders reach a near-equilibrium, that becomes the exchange rate - until another bout of trading later in the day.

AND THIS....

New currency
Dealers defy Central Bank on exchange rates
By Sarmad S. Ali - 13-Oct-2003


BAGHDAD- Moneychangers and major bourse traders, known as "Big heads", say they will refuse to comply with the Iraqi Central Bank's plan to set the dinar-dollar exchange rate. The traders' challenge to the central bank may come as a blow to the Central Bank's plans to take control of Iraq's money supply.

On October 4, Ahmed Salman, deputy governor of the Central Bank, declared there will be three weekly auctions for setting exchange rates and that these rates are expected to apply to the dealers at the money markets.

The Bank's "Foreign Currency Auction" policy aims at setting a unified exchange rate throughout the country, giving the Bank a central role in the nation's economy. The move is part of the overall plan to build confidence in Iraq's currency, which will be swapped on October 15.

Dealers question the Bank's ability to maintain control over exchange rates and are against the idea that the Bank should take control of the foreign currency market itself. They point out that the Central Bank appears to not have taken into account the strength of the dollar against the dinar, as people continue put their money in the greenback rather than the dinar. Besides, say traders, the auctions have already run into problems (see page 9).

"I don't think that the Central Bank will have full control over the traders of the bourse because the dinar-dollar exchange rate is a matter of demand. If there is a rise in the country's imports, then the dollar will soar; but if imports shrink, it will face a decline," said Ali Hawaishawi,a chief trader at the Kifah street market, Baghdad's main bourse. "This, has so far been the policy of the market," he added.

The dinar-dollar exchange rate has long been a bone of contention between the "Big heads" at Kifah, who set the rate for the majority of Iraq's markets, and the Central Bank. During Saddam's rule the Bank was continuously fighting with currency traders to set "impossible" foreign currency exchange rates, with little success. For example, the Iraqi dinar witnessed a dramatic drop in its value against the US dollar during the war. On one occasion it fell to more than ID4000 to the dollar. At that point, the exchange rate was greatly fluctuating. Meanwhile, the Central Bank of Iraq was buying and selling dollars at a worse rate than the markets were, effectively handing over control to the dealers.

The news that dealers still have no intention of complying with Central Bank demands will come as a disappointment to consumers, the traditional losers in the battle. Consumers have long been duped by traders and have been liable to their tricks and their expert manipulation of the rates of exchange. Traders were able to to buy ID10000 notes at discounts of up to 40% in recent months, based mainly on a campaign of rumors and lies. Traders have long played on the belief that ordinary dinar notes could easily be forged and "Big heads" often circulated rumors that large quantities of counterfeits had swamped the markets.

After the war, market manipulation phenomenon became so prevalent that no denomination escaped the devaluation process. It has recently spread to small denominations of US dollars. As October 15 drew nearer, the dealers took the opportunity to take profits, and now the ID10000 is only trading at a ID500 discount. Traders repeatedly claimed that these bills had already been looted from banks in the wake of war. No sooner had the ID10000 witnessed a revaluation, than traders found the newer, smaller ID250 as an alternative through which they could make a fortune. The note has been devalued and rejected in the markets and among dealers due to rumors they allegedly spread themselves. In fact, the big bourses, like Kifah, now behave like cartels that aim to regulate and manipulate monetary policy to serve their own interests.

Dealers at Kifah, Harthiya and Khadimiya, the main foreign exchanges in Baghdad, have highlighted their dismay at the Central Bank attempt to apply a steady unified exchange rate. "Even if the Central Bank has started setting the exchange rate, it will not be able to generalize this rate all over the currency markets or force the traders here to comply with its own policy," insisted Hameed Raad, a moneychanger at Khadimiya.

Raad may well be correct. Dealers who are practiced in preserving their profits represent a tough obstacle to the Central Bank's plans. Certainly, the moneychangers have become much more adroit at spurring people on to the currency markets than any economists have?


Maybe the CBI should put these guys in charge.

Cheers!
DayDream

Translated version of http://al-moharer.net/moh198/fouad198a.htm

Add to that today's clarification and further information to those interested, as has been frozen Iraqi assets or funds have also been freezing all Iraqi property abroad (embassies and consulates and the headquarters of Iraqi diplomatic missions and houses, which had bought the Iraqi government in the countries of the world and all of Ka Net belonging to the Iraqi Ministry of Foreign Affairs) and the freezing of Iraqi gold subject secretariat in Switzerland, which is estimated at hundreds of billions of dollars, Here I note that the gold is to cover the value of the Iraqi currency in circulation, Remember also that most if not all countries in the world have gold reserves insured in Switzerland to cover their currencies in circulation, So when gold was freezing Iraqi landed value of the Iraqi currency in circulation and has become what is known in Iraq at the time the "Swiss dinar," which was circulated in northern Iraq in the Autonomous Region "Kurdistan" and "the Iraqi dinar," which was circulated in other parts of Iraq, because I was staying in Switzerland for the insured value of the gold there, The second Iraqi government began has been printed in Iraq. It is one of the main done by the invasion and occupation forces Zionist-American in Iraq after the dissolution of the Iraqi army after the burning and destruction and theft of all official circles in Baghdad, including the Iraqi Foreign Ministry.the burning of the Iraqi currency was replaced currency other for many reasons, including most importantly for the rest of the theft of Iraqi gold in Switzerland!..It is one of the main done by the invasion and occupation forces Zionist-American in Iraq after the dissolution of the Iraqi army after the burning and destruction and theft of all official circles in Baghdad, including the Iraqi Foreign Ministry. the burning of the Iraqi currency was replaced currency other for many reasons, including most importantly for the rest of the theft of Iraqi gold in Switzerland! As happened in stealing Iraqi money, which was in a special account in the bank under the supervision of the French National Committee notorious which bore the number 661, which was controlled by America and Britain.As happened in stealing Iraqi money, which was in a special account in the bank under the supervision of the French National Committee notorious which bore the number 661, which was controlled by America and Britain.

U.S. warplanes bomb Sadr office in Sawirah-spokesman

By Abdul-Jabbar al-Sufrani
Kut, Oct 21, (VOI) – U.S. warplanes bombed on Saturday Shaheed Sadr office in Sawirah district, 135 km north of Kut, killing and wounding an unidentified number of the Shiite young cleric Muqtada al-Sadr’s followers , the spokesman for the Shaheed Sadr office said.
“U.S. warplanes bombed today afternoon the Shaheed Sadr office in Sawirah district,” the spokesman Hameed al-Zirgani told the independent news agency Voices of Iraq (VOI).
The bombing resulted in killing and wounding some followers of the Shiite young cleric Muqtada al-Sadr, he added.
The spokesman did not give further details.
Sawirah district was a scene of clashes between unknown gunmen and Iraqi security forces backed by the Multi-National forces.

Translated version of http://news.bbc.co.uk/hi/arabic/talking_point/newsid_3003000/3003522.stm


The future of the Iraqi dinar
The talk about the Iraqi dinar exchange rate and the fluctuation in the market, one of the top concerns of Iraqis daily newspaper, in this they are closer to the concern and fascination with the rise of land prices and the level of concern at the deterioration of security conditions in their country following the American invasion them.
It is the hope of many Iraqis in restoring currency to the value and strength of Yugoslavia, which was during the 1970s and 1980s, as the official exchange rate of the dinar by more than three dollars to dinars per while the deterioration of the price up before the recent war to more than two thousand dinars to the dollar.
There are some political parties of those who seek to find a quick solution to the current crisis of the dinar, put some ideas to talk about the link to the American dollar temporary, any dollarizing the dinar for a specified period even be accurate studies on the conditions of the Iraqi economy.
Some also talked about linking gradually to the current value of the dinar, ranging at a level not more than one thousand and five hundred dinars to the dollar, the current value in the Iraqi Kurdistan region, that amounts to the value of what is known in Iraqi dinars / Swiss edition about twenty dinars to the dollar
According to Dr. Zia Net, Professor of Mathematical Economics in the Faculty of Administration and Economy Mustansiriyah University, that dollarizing the economy is the best solution under the current circumstances to ensure the future of the dinar. that does not exceed the period of six months or a year at most.
He added that this solution will ensure the protection of the dinar against the consequences of speculation that adversely affect the actual value him, Having achieved a period of relative calm and stability, counting with the difficult legacy of underdevelopment long years of the economic embargo on Iraq.
According to Dr. Dia that the Iraqi economy will shift with time to a free market economy, where will most public institutions to the private sector except for strategic industries such as oil, This means that the actual value of the dinar will be under the influence of supply and demand. in addition to other critical factors, such policy of the state of public finances.
The assurances of Dr. Ali Abdul Rasul, He is deputy Iraqi former Minister of Finance, earlier, the Director of the Fund for the development of the Iraqi Foreign Affairs, he believes that the Iraqi economy will see a prosperous future, , which will reflect positively on the value of the Iraqi currency, where Iraq has huge oil reserve size.
Also expected to increase revenues in Iraq, in the long run, to greatly exceed expenses and the expenses of Iraq, This lead to a rise in stocks and the cumulative foreign exchange reserves, in addition to the impact of factors other on the open market exchange rate.
And through this expert on the hope that the Iraqi currency prosperous and places it in the recovery of preferential compared with the currencies of the Gulf states rich, and perhaps surpassed in subsequent phases.
In the short and medium term, opines Dr. assurances that dollarizing the economy is the case already exist in the era of former Iraqi President Saddam Hussein. The Iraqi people maintained Pmdkharch dollar, The majority of commercial transactions and real estate and the other is the American currency.
The estimated ratio of the dollar in contracts and commercial transactions, The import activities, during the last period not less than the 60th% of the total economic activity in Iraq.
He criticized the delay in ruling the American authorities in Iraq in the introduction of a new currency, It is in fact not done old photo of Saddam Hussein, and therefore return to the previous categories of paper and five ten dinars instead of the current large groups.
Dr. Fayeq believes that the replacement of the current dinar is very possible and easy. nor is required from the authorities concerned only put about two and a half billion dollars, the funds available balances in the Central Bank of Iraq.
This expert also drew the blame to the authorities in Iraq for the delay in the implementation of the necessary measures to revive the economy and thus reviving the dinar, pointing out that the expiration of three months without taking any concrete and effective action is already disgusted and outraged Iraqis.
He said that the delay would only breed more from the ranks of the unemployed, and further aggravated circumstances and the complexity, It would adversely affect the popularity of the coalition forces. stressing that the time had come for the formation of a national government take it upon themselves to set the economy on the right track.

$onedaysoon$ -do you know the date of this article? Could be huge if USA & Brits still have this and turn over to Malikis Govt. Seems to be from the first Gulf War when you read the translation from the link. If the Iraqi Govt really does have "hundreds of billions in gold" then they could easily do a large reval to cover the currency in circulation!

Originally Posted by day dreamer

Wasn't it stated somewhere where the money would be given out before Eid Al-Fitr?????

I found this yesterday and posted it yesterday but in case anybody missed it...I thought it was interesting...and goes along with holiday...

JEDDAH, 21 October 2006 — Eid Al-Fitr, the celebration marking the end of fasting in Ramadan, will be Monday, according to Khaled ibn Saleh Al-Zaaq, member of Arab Space Science Federation and supervisor of Buraidah Astronomical Observatory. In a statement carried by Al-Eqtisadiah newspaper, Al-Zaaq said it would be impossible to sight the Shawwal crescent today (Saturday) as it will disappear one hour before the sunset.
“We can only see the new moon on Monday evening with difficulty as it will be visible for only 36 minutes with a glow of 1.90 percent,” said Al-Zaaq, who is also a member of the Islamic Project to Observe the Crescent. He urged the public not to be confused by seeing celestial bodies on Saturday evening.
Ali Manikfan, an Indian expert on moon sighting, also confirmed that Monday would be the first day of Eid. “I have observed the waning phases of the moon in the last days of Ramadan. Yesterday morning I could see the crescent at about 8 a.m. It was about 25 degrees away from the sun. The crescent will be visible today (Saturday) before sunrise. This will be the last visible phase of the moon for Ramadan,” Manikfan said in a statement.
“Sunday morning the crescent will not be seen even though it will rise before the sun. This is the day on which the moon phase is not visible to the earth. Somewhere in the world both the sun and the moon will rise together on Sunday,” said Manikfan, who is a staunch advocate of a unified Islamic calendar.
called upon Muslims all over the world to celebrate Eid Al-Fitr on the same day. He urged the Organization of the Islamic Conference to unify the Islamic calendar.
“Eid Al-Fitr should be celebrated on the first day of the lunar month of Shawwal. Muslims around the world are now celebrating it on three different days due to the lack of a unified calendar,” he told Arab News.
Manikfan urged Muslims to adopt modern technological methods to sight crescent.
“Islam is the most advanced and scientific religion. It’s impossible to believe that the Prophet (pbuh) would instruct his followers in this age of science and technology to search for the new moon with their naked eyes when lunar and solar dates can be determined in advance on the basis of scientific calculations,” he said. He hoped that Saudi Arabia would take the lead and prepare a unified Islamic calendar for distribution in all Muslim countries.
Astronomer Says Eid Will Be Monday

Read the rules before posting in this "THREAD"!! tks-neno

From Original Post 1 in the thread.

Ok this will start our "Latest News Thread", with the same rules for posting here. Everything else has been Moved to the History Thread. for reference. Continue the quest for the reval with rules followed. Have a Great Future.

3. Latest On the Dinar Threads Part's 1 & 2 & 3 & 4 & 5 &6 & 7 are locked and Merged into a (History Thread) and left as a sticky for references. This is ("Latest") News on the Dinar. Please Post all articles and Try to stay on the topic.

4. Anything you want to discuss other than the Article about the Latest News, please do it in other threads Mark for the occasion "or" "Crazy Thread"
http://www.rolclub.com/iraqi-dinar-d...razy-here.html It is a Sticky Thread Also. Even if it you are excited, a thank you, a testimonie, are a hello to your mama.

I have change these three parts of the Dinar Forum. At the request of a couple members and I agreed with them. I have taken all the Parts 1thru7 and merged them into a History thread. This way one, will be our latest News. Not a Part 8 nomore. Actually we are still in Part one right. Part 2 is after the r/v.

Also have merge the Crazy Threads as well. if you need to look anything up use the search function in the thread itself. This will alliminate all the sticky parts.

Read the rules before posting in this "THREAD"!! tks-neno

************************************************** ********

Read the rules before posting in this "THREAD"!! tks-neno

No comments needed here on this, in this thread. Just wanted to inform you all of this. Now what we have is this:

(Histroy Thread) News on the Dinar. > Parts 1 thru 7 merged, and will add older ones as this thread grows.

("Latest") News on the Dinar. > Originally Part 8

Crazy Thread!!. > Parts 1 thru 3 merged.

Archived Post from the News thread. > Like it says.

Simiple enough.

Read the rules before posting in this "THREAD"!! tks-neno

Originally Posted by Mike5200

$onedaysoon$ -do you know the date of this article? Could be huge if USA & Brits still have this and turn over to Malikis Govt. Seems to be from the first Gulf War when you read the translation from the link. If the Iraqi Govt really does have "hundreds of billions in gold" then they could easily do a large reval to cover the currency in circulation!

2004, THIS ALSO PULLED FROM LINK
And come back to this issue because the forces of despotism in the world led by the Department of evil Zionist-American wants to conceal all information on the real Iraqi money! Especially after the publication of the news of a small newspaper in the (New York Times) on the second of this month for the meeting, without Ttelcfh or dealt with the media as usual broad coverage and at the request of American, the news of the contract (a meeting of the seven major industrial countries and the IMF and the World Bank) in Washington at the end of the first week of this month (October 2004).

Analysis: Iraq oil production claim stuns experts
10/20/2006

Ben Lando
United Press International
October 20, 2006



WASHINGTON -- Iraq's oil minister stunned experts this week when he said production had reached 2.86 million barrels per day - higher than pre-war levels and above what was known as Iraq's capacity of about 2.5 million barrels per day.

Oil minister Hussein Al Shahristani said production in the south - home of Iraq's largest known reserves - and the north, which has been hit with violence, have improved, the Middle East North Africa Financial Network reported Wednesday, citing the Arabic Al Sabah newspaper.

This announcement may be overreaching optimism, or merely political posturing and while some analysts say production has increased in Iraq, they are more skeptical of Shahristani's numbers.

There is no way to get a 100-percent accurate reading on Iraq's oil meters - since none are in place, analysts say. Most rely on Iraqi oil exports as a hard-number buoy, then add in various upstream conditions to gauge production totals.

The US Energy Department's data arm, the Energy Information Administration (EIA), estimates exports averaged 1.6 million barrels a day for September, and domestic consumption somewhere between 500,000 and 600,000 barrels a day.

EIA production for September was estimated at 2 million, the same as capacity.

Among the factors hindering an accurate measure of oil production is smuggling and stealing, reinjecting into the ground crude stripped of easy-to-process liquids (usually because of a lack of transportation or refinement capacity), and oil lost from attacks on oil infrastructure.

PFC Energy said it appears production has increased from the 1.9 million barrels per day estimated for last month to about 2.35 million to 2.4 million barrels per day now, but "certainly not" 2.86 million, PFC's Saad Rahim said.

He said the ministry has posted these numbers with no back-up.
"They haven't said how they've reached these levels," Rahim said.

Iraqi infighting in the south, where much of Iraq's estimated 115 billion barrels of reserves are located, has spared the oil infrastructure, since it's viewed as an income source for the eventual winner of the clash, said Greg Priddy, an analyst with the Eurasia Group, a business political risk consulting firm.

The pipeline from Kirkuk - a city atop an estimated 11 billion barrels of oil and growing in both political importance and violence - to a port in Ceyhan, Turkey, however, has seen no such respite.

The state-run Northern Oil Co. said this week oil flow resumed in the pipeline after months offline, though only 250,000 to 350,000 barrels a day run through it. The Bayji refinery, Iraq's largest, on the Kirkuk-Ceyhan stretch, can't get enough electricity to keep it running.

The EIA estimates Iraq refining capacity at nearly 600,000 barrels a day. "However, it is unable to produce much of the kind of product that it needs, so it imports refined products from its neighbors," the EIA said. "Imports varied recently from 20 percent of kerosene requirements to 50 percent of gasoline."

The EIA said, however, the closest Iraq came to Shahristani's recent outlook - in fact, since the run-up to Operation Desert Storm in the early 1990s - was 2.47 million barrels per day for a week between August and September.

Priddy said he estimated exports at around 1.7 million barrels per day, so there's "absolutely no way" Iraq is producing 2.86 million.

His colleague at Eurasia Group, Peter Khalil, who also served as director of National Security Policy for the US-led Coalition Provisional Authority in Baghdad, said Shahristani needs to qualify his estimate.

"He likes shooting from the hip about figures, doesn't he?" said Khalil about past announcements proven way overstated. "If it's accurate, that's very good news for Iraqis, of course."

Khalil said any increase in production would look good to foreign investors, investment which Shahristani is seeking during planned trips to Australia, Japan and China.

Dathar Al Khashab, general manager of state-run Midland Refineries Co./Daura Refinery, also called for financiers at a recent American Petroleum Institute conference in San Antonio. "Please help," he said. "Please be brave enough to go to Iraq. Don't just sit there and wait on the opportunity."

Khalil said, "They need that money to get in there" in order to repair an oil infrastructure badly damaged by wars, sanctions and lack of attention during Saddam Hussein's regime.

More than security, oil companies are waiting for the Iraqi government to finalize a federal oil law, which would define regulatory conditions for investment, he said.

To do that Iraq will need to settle regional disputes between the Kurds in the north, Shiites in the south, and oil-poor Sunnis in the center over oil wealth distribution.

The process for constructing an oil law is being done in secret, but is required to be passed by parliament before the year's end to comply with International Monetary Fund obligations and Paris Club debt cancellation.

Major Change Expected In Strategy for Iraq War
10/20/2006




By Michael Abramowitz and Thomas E. Ricks
Washington Post Staff Writers
Friday, October 20, 2006; A01




The growing doubts among GOP lawmakers about the administration's Iraq strategy, coupled with the prospect of Democratic wins in next month's midterm elections, will soon force the Bush administration to abandon its open-ended commitment to the war, according to lawmakers in both parties, foreign policy experts and others involved in policymaking.

Senior figures in both parties are coming to the conclusion that the Bush administration will be unable to achieve its goal of a stable, democratic Iraq within a politically feasible time frame. Agitation is growing in Congress for alternatives to the administration's strategy of keeping Iraq in one piece and getting its security forces up and running while 140,000 U.S. troops try to keep a lid on rapidly spreading sectarian violence.

On the campaign trail, Democratic candidates are hammering Republican candidates for backing a failed Iraq policy, and GOP defense of the war is growing muted. A new NBC-Wall Street Journal poll released this week showed that voters are more confident in Democrats' ability to handle the Iraq war than the Republicans' -- a reversal from the last election.

Few officials in either party are talking about an immediate pullout of U.S. combat troops. But interest appears to be growing in several broad ideas. One would be some kind of effort to divide the country along regional lines. Another, favored by many Democrats, is a gradual withdrawal of troops over a set period of time. A third would be a dramatic scaling-back of U.S. ambitions in Iraq, giving up on democracy and focusing only on stability.

Many senior Republicans with close ties to the administration also believe that essential to a successful strategy in Iraq are an aggressive new diplomatic initiative to secure a Middle East peace settlement and a new effort to engage Iraq's neighbors, such as Syria and Iran, in helping stabilize the country -- perhaps through an international conference.

One point on which adherents of these sharply different approaches appear to agree is that "staying the course" is fast becoming a dead letter. "I don't believe that we can continue based on an open-ended, unconditional presence," said Sen. Olympia J. Snowe, a centrist Maine Republican. "I don't think there's any question about that, that there will be a change" in the U.S. strategy in Iraq after next month's elections.

Richard N. Haass, a former Bush administration foreign policy official, told reporters yesterday that the situation is reaching a "tipping point" both in Iraq and in U.S. politics. "More of essentially the same is going to be a policy that very few people are going to be able to support," said Haass, now the president of the Council on Foreign Relations. He added that the administration's current Iraq strategy "has virtually no chance of succeeding" and predicted that "change will come."

Many Senate Republicans are waiting for the recommendations of the Iraq Study Group, a bipartisan panel co-chaired by former secretary of state James A. Baker III, a Republican, and former Indiana congressman Lee H. Hamilton, a Democrat. Both Baker and Hamilton have made it clear that they do not see the administration's current Iraq policy as working -- though they do not plan to issue recommendations until well after the midterm elections, probably in early January.

Many foreign policy experts believe that the commission could sway President Bush more than most such study groups because of Baker's close ties to the Bush family.

In an interview this week, Hamilton said there is no "silver bullet" to turning the situation around in Iraq but noted that frustration is clearly rising over the current course. "I can't walk out the door without someone handing me a recommendation," he said.

Sen. John E. Sununu (R-N.H.), a member of the Foreign Relations Committee, said he is open to "significant changes" in the U.S. approach and is hoping the Iraq Study Group can supply them. "I don't think anyone in the administration is pleased about the current state of affairs," he said. "I would hope that members of the administration are willing to learn from past mistakes . . . and choose a different path that would allow us to meet our objectives."

How open Bush will be to a change in course is unclear, even as the violence escalates -- this week has been one of the bloodiest for Americans in Baghdad in months. In recent remarks about Iraq, Bush has sounded a more flexible tone, saying he is open to suggestions for changes and emphasizing that his commanders adjust tactics constantly. He has repeatedly made it clear that U.S. patience with the new Iraqi government is not open-ended.

White House officials describe the current turmoil over Iraq policy in Washington as an expected byproduct of the upsurge in violence. Press secretary Tony Snow yesterday dismissed a dramatic about-face in policy -- such as a division of the country or phased withdrawal -- as a "non-starter" and called the idea that the White House will seek a course correction in Iraq "a bunch of hooey."

Bush has been adamant that the United States will not withdraw its troops until the Iraqi government can defend itself.

Like many who have met with the president in recent months to discuss Iraq policy, author and military expert Robert Kaplan said he detected clear limits to Bush's flexibility. "He seemed genuinely to enjoy the challenges to his policy that we threw at him," Kaplan said, describing a session Bush held with several outside strategists at Camp David in June. "He wasn't at all defensive. He appeared open to any new direction or tactic, except withdrawal, and yet that is what he might be faced with after November."

Along with the political debate, there also is growing frustration inside the U.S. military over Iraq, with some officers debating privately whether the situation there is salvageable. In recent weeks, senior military officers have offered a torrent of negative comments, a sharp contrast to the official optimism of the past three years.

"We're obviously very concerned about what we're seeing" in Baghdad, Army Maj. Gen. William B. Caldwell, the top U.S. military spokesman in Iraq, said yesterday. He indicated that changes to a plan to restore security to the capital are being considered. "We find the insurgent elements, the extremists, are in fact punching back hard," Caldwell said.

In recent days, the demand for change on Iraq has been especially notable from inside the president's party: Sen. John W. Warner (R-Va.), the chairman of the Armed Services Committee, returned from a trip to Iraq saying that country was adrift and all options should be considered. Sen. Kay Bailey Hutchison, a conservative Republican from Texas, said this week that she is willing to consider the wisdom of somehow breaking up Iraq.

Until now, Democrats' calls for withdrawing troops have been largely irrelevant, but if Democrats take one or both houses of Congress next month, their views could become significant in shaping strategy.

Sen. Carl M. Levin (D-Mich.), who would take over the chairmanship of the Armed Services Committee, said he favors beginning a phased withdrawal of U.S. troops that "gives the Iraqis notice that they're going to be looking into the abyss" unless they make necessary changes.

One version of this option was presented to House Democrats last month by former national security adviser Zbigniew Brzezinski, who outlined a four-step plan that would include a joint declaration by the U.S. and Iraqi governments on a timeline for the departure of U.S. troops, a follow-up international conference on stabilizing Iraq and a greater focus on economic reconstruction.

Rep. Steny H. Hoyer (D-Md.), who is campaigning to become the new majority leader should Democrats take power, said many in his caucus like the idea behind the Brzezinski plan, though perhaps not all the specifics. "The Iraqis have to understand that there is a time frame," he said. "Our commitment is substantial, but it is not unending."

People familiar with the work of the Iraq Study Group say it is also mulling a variant of the gradual withdrawal idea that would move U.S. troops out of Iraq but leave a residual force in the region to keep the violence from spreading and Iraq's neighbors from meddling.

Another idea getting a closer look is a new power-sharing agreement that would give more power to autonomous regions -- Kurdish in the north, Sunni in the middle and Shiite in the south -- while weakening the central government. This idea is most closely identified with Sen. Joseph R. Biden Jr. (Del.), the senior Democrat on the Foreign Relations Committee, and Leslie H. Gelb, a former president of the Council on Foreign Relations. Because there is no oil in what would be the Sunni-controlled area, Biden and Gelb envision some sort of scheme to share oil revenue with the Sunnis to get them to agree to such a plan.

Biden said yesterday that if the Democrats win big in next month's elections, "You have a lot of Republicans who are going to openly join Democrats and will push back hard against the president."

© 2006 The Washington Post Company