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

Originally Posted by SeaRayaWaitin'

I don't know who made up this whole line of reasoning but I think it is a completely bogus assumption. Not ripping on you warrior but I keep seeing people talk about "buying up Iraq for pennies on the dollar". Who came up with this? It makes no sense at all. If it did then why aren't the "big boys" out buying up all the countries with hyper-low exchange rates? The reason everyone keeps getting all hyped up and then let down is because they're operating under invalid assumptions and presumptions that have somehow magically become fact as they are passed around the circle from ear to ear. I think we will see a very nice exchange rate at some point in time fairly soon but I think that at least half of the "indicators" we're looking at are invalid.

You have just brought up the very subject that has been bothering me thoughout this whole process. IMHO, if a stock or investment of some type cost a set amount, say $1,000, that same stock/investment would be worth the same value regardless of the currency used to purchase it, right? It would just either take more or fewer units of the particular currency used to buy the stock/investment. When I worked in Mexico the peco was 30:1,when I bought something valued at $5.00, I could use the $5 USD or 150 pecos...either way the cost was the same. The only difference is that if something costs $5.00 I may be able to afford it where the average Mexican resident could not afford the equivalent 150 pecos. Does this make sense? Just my thoughts.

Originally Posted by ccgideon

You have just brought up the very subject that has been bothering me thoughout this whole process. IMHO, if a stock or investment of some type cost a set amount, say $1,000, that same stock/investment would be worth the same value regardless of the currency used to purchase it, right? It would just either take more or fewer units of the particular currency used to buy the stock/investment. When I worked in Mexico the peco was 30:1,when I bought something valued at $5.00, I could use the $5USD or 1,500 pecos...either way the cost was the same. The only difference is that if something costs $5.00 I may be able to afford it where the average Mexican resident could not afford the equivalent 1,500 pecos. Does this make sense? Just my thoughts.

But, if that is the case ccg, isn't that local market pricing their products targetting foreigners (who can afford that product) rather than their local residents? That's awfully risky to price their average Happy Meal at McD at 1500 pesos in hopes of attracting a foreigner with $5 in their pocket when their local residents with much less in their pockets are right outside on the sidewalk. I would think the businesses should be pricing their products based on their local income demographic. Am I way off base?

What was it adster said earlier today about getting it done by the 23rd? why that date, anyone remember?

Originally Posted by Vipor

But, if that is the case ccg, isn't that local market pricing their products targetting foreigners (who can afford that product) rather than their local residents? That's awfully risky to price their average Happy Meal at McD at 1500 pesos in hopes of attracting a foreigner with $5 in their pocket when their local residents with much less in their pockets are right outside on the sidewalk. I would think the businesses should be pricing their products based on their local income demographic. Am I way off base?

To expand a little further ... using this frame of thinking...

If a local fish market was priced for sale targetting a potential buyer within their local community based on their local peso currency, I can come in with my USD currency which is worth 30x and buy that fish market for 1/30th the cost to me. If by chance that fish market was price adjusted for sale to me using USD, then their local community has zero chance of buying. Thus, the target buyer is a foreigner and not a local.

Originally Posted by Vipor

But, if that is the case ccg, isn't that local market pricing their products targetting foreigners (who can afford that product) rather than their local residents? That's awfully risky to price their average Happy Meal at McD at 1500 pesos in hopes of attracting a foreigner with $5 in their pocket when their local residents with much less in their pockets are right outside on the sidewalk. I would think the businesses should be pricing their products based on their local income demographic. Am I way off base?

I see your line of thought, however, the low wages and unemployment was the reason I could afford things and the average Mexican resident could not...thus the poverty....and the exact reason you seldom see such places as McDonalds beyond the 50 mile border limit. And I did mean 150 pecos, not 1,500...sorry.

Originally Posted by Vipor

To expand a little further ... using this frame of thinking...

If a local fish market was priced for sale targetting a potential buyer within their local community based on their local peso currency, I can come in with my USD currency which is worth 30x and buy that fish market for 1/30th the cost to me. If by chance that fish market was price adjusted for sale to me using USD, then their local community has zero chance of buying. Thus, the target buyer is a foreigner and not a local.

and if they priced it 30x higher to then they would have virtually NO chance of selling it.

Originally Posted by CharmedPiper

I look for the reval this week once the CBI has pulled in their targeted amount of dinar. The HCL and FIL do not need implemented to allow a reval.....but...a reval must be in place on or before the HCL and FIL are implemented. In my opinion they need to show progress in a very dramatic and immediate way and this can be accomplished instantly with a reval and this will show a good faith effort to push forward.

How do we know that CBI has drawn in their targeted amount of dinar from the local economies? Please explain.

Originally Posted by ccgideon

I see your line of thought, however, the low wages and unemployment was the reason I could afford things and the average Mexican resident could not...thus the poverty....and the exact reason you seldom see such places as McDonalds beyond the 50 mile border limit. And I did mean 150 pecos, not 1,500...sorry.

No biggie ccg. Just explaining the line of thinking some of us have when saying "come in and buy up the country".

Speaking at the Bahrain Institute of Banking and Finance (BIBF) at the launch of an innovative programme which will see 16 high-ranking officials of the Iraq Central Bank trained at the acclaimed Bahraini institution, Ahmed Agha, of Iraq’s embassy in the Kingdom said: [B]“Today the economy is the most powerful tool to fight any army or to break any radical idea in the world.”[/B]
In a frank address to an audience which included US Ambassador to Bahrain William Monroe, Agha did not shy away from the problems facing Iraq – but was optimistic that with help from its neighbours the country could recover to the extent that it would be “one of the richest countries in the world”.
He said: “In the last few decades it is true that Iraq did not have many friends. We were thrown into a war with Iran. We were forced to invade Kuwait and we were a threat to the region. However, those days have gone and the situation is different. “But we have another threat now and I can say that it is more dangerous than the one before. International terrorism in Iraq.”
He went on to explain the role that Bahrain could play in strengthening Iraq against its foes, adding: “We have exhausted and used so many political means to fight these enemies and still we are struggling. Why don’t we use the economy this time; why don’t we use knowledge?”
http://www.bahraintribune.com/ArticleDetail.asp

Originally Posted by ccgideon

I see your line of thought, however, the low wages and unemployment was the reason I could afford things and the average Mexican resident could not...thus the poverty....and the exact reason you seldom see such places as McDonalds beyond the 50 mile border limit. And I did mean 150 pecos, not 1,500...sorry.

I do agree certain things purchased by locals are much cheaper, but those are mostly essentials for sustaining life, and not a very good life at that. But such things, yes, I could buy for 30x cheaper in my currency, but that did not apply to investments and things related to the countries natural resources. Barely anyone had a car..and if they did it was a wreck...homes were cardboard shacks, so naturally few were invested in anything as far as the countries resources. What made my money go far was what could be purchased from the local labor and goods produced by those less fortunate than myself. I guess when I think of buying a country for pennies, we are talking about things controlled by the foreign country's government, and that was in no way cheaper. Guess that accounts for the the wealth of the political figures and the poverty of the public. I may be way off base...just my thoughts.