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

Originally Posted by pipshurricane

This news mean then that Iraq is NOT ready to fully control oil revenue. Deposits will continue in New York......and not the Central Bank of Iraq.
They may review this decision by June............

UNSC set to extend MNF force next week until Dec 2007

POL-UN-COUNCIL-IRAQ
UNSC set to extend MNF force next week until Dec 2007

UNITED NATIONS, Nov 17 (KUNA) -- The UN Security Council is scheduled to extend the mandate of the Multinational Force (MNF) in Iraq next week until December 31st, 2007 and that in response to a request by Iraqi prime Minister Nouri Al-Maliki.

According to a draft resolution circulated among council members, the council would review the MNF mandate no later than June 2007 and declare that it will terminate its mandate earlier if the government wishes to.

The council would also extend until December 2007 the arrangements to deposit the proceeds from oil and natural gas export sales into the Development Fund for Iraq and the arrangements for the monitoring of the Fund by the International Advisory and Monitoring Board (IAMB).

These two kinds of arrangements would also be reviewed, at the Iraqi government's request, no later than June 2007.

The council would also ask the US to continue to report to the council, on behalf of the MNF, on the efforts and progress of this force on a quarterly basis. (more) sj.

Kuna site|Story page|UNSC set to extend MNF force next week until Dec 2...11/17/2006

This doe's not look good. Hope some others can shed light on this.

Originally Posted by Dinar Cha Ching

But based on this shouldn't the value increase? Fewer Dinars in supply with inceasing demand for fewer dinars would seem to indicate a higher value or are you saying they are positioning themselves a major pop in value?

I have always believed that this process of decreasing the base money supply was exactly what you would expect prior to a reevaluation of the currency. So to answer your question, yes I think they are positioning themselves prior to an RV. When and how much is harder to guess. But this has been very good news for us and suggests better things to come. Thank You

I hate to show my ignorance, but this trend we are seeing at cbi, have we ever seen this before???

OWEJAC, I think this is probably just a mistake. The spead on the selling and asking price is not that far off at the TBI compared to the CBI. I thnk that maybe the 5 in the buying price at the TBI should have been a 4 but I'm just guessing here. The figures certainly don't jive, do they?

Hey, maybe somethings getting ready to happen.

Originally Posted by Wm.Knowles

Hello everyone. Well we continue to see a trend of the CBI removing dinar form the economy. Todays auction results have fewer banks and the total amount is not that large. At some point there will be a "drying up" of available cash that can be removed. As the rate increases, fewer prople will let go of their cash at these levels. With all of the articles that have been posted (thanks SGS and others) it is safe to assume that Iraq is experiencing an expanding economy. Estimates have been posted of an increase in GNP of over 14 percent. When you have an expanding economy, you have an increase in the DEMAND for money, when you have a central bank decreasing the base money supply you have a reduction in SUPPLY of that commodity. Expanding economy and reduction of the money supply. A formula that predicts a rise in the price levels of that commodity, in this case the Iraqi currency. The very BEST position we could be in. We WANT as much of that currency removed prior to an RV as possible. We WANT continued expansion of that economy. So, this is all very good fundamental economic news for all of us. Thank you for your many comments and PMs.

Do you think by the lower number removed from circulation, that we are starting to get to the bottom? It seems as though the current numbers were about average during the year. So what are we seeing here, and what should we be looking for?

worf

Originally Posted by Gloribee

This doe's not look good. Hope some others can shed light on this.

The GoI can RV whenever they have the confidence that their domestic banking structure can support large scale and international transactions.
I believe the renewal of these UN resolutions is tied to the ICI for the sake of the international partners and donors.
The current appreciation of the currency by the CBI is in an effort to check inflation, which will in turn, increase the purchasing power for local Iraqis.
The ministerial meeting on the ICI and the upcoming IMF SBA review should provide some GREAT clues as to Iraq's progress and future direction.

Originally Posted by Gloribee

This doe's not look good. Hope some others can shed light on this.

I don't see this as negative news. This is at the request of the Iraqis and can be changed by them at any time and it does mean that they will continue to have the help of the MNF for at least another year.

Originally Posted by Wm.Knowles

Hello everyone. Well we continue to see a trend of the CBI removing dinar form the economy. Todays auction results have fewer banks and the total amount is not that large. At some point there will be a "drying up" of available cash that can be removed. As the rate increases, fewer prople will let go of their cash at these levels. With all of the articles that have been posted (thanks SGS and others) it is safe to assume that Iraq is experiencing an expanding economy. Estimates have been posted of an increase in GNP of over 14 percent. When you have an expanding economy, you have an increase in the DEMAND for money, when you have a central bank decreasing the base money supply you have a reduction in SUPPLY of that commodity. Expanding economy and reduction of the money supply. A formula that predicts a rise in the price levels of that commodity, in this case the Iraqi currency. The very BEST position we could be in. We WANT as much of that currency removed prior to an RV as possible. We WANT continued expansion of that economy. So, this is all very good fundamental economic news for all of us. Thank you for your many comments and PMs.

Mr. Knowles,
I always enjoy reading your posts. There is only one problem with them. After I read them it makes me feel dumber and dumber because you know so much more than me about the economic situation we are involved in here. But I do really appreciate your knowledge as well as your sharing it with us here.

Originally Posted by shotgunsusie

.:: Peyamner Daily NEWS::.

Sounds like more bickering to me. The powers that be over there will continue to fight over the money, whether there're right or wrong doesn't matter. This is sad but true and will certainly not change any time soon. However, I don't think this will hinder the r/v.

Okay, there was a link posted...this talks about procedures for MEMBERS...Is Iraq a member? This looks like a reval (establishment of Par Value). I'm not sure where the creeping peg bit came in (see my previous post) because it's not mentioned here.

As far as I can see this does not specifically pertain to Iraq--it seems to be IMF rules and regs. So somebody with more knowledge and understanding of how Iraq and the IMF are interacting, please take a crack at it!!

Articles of Agreement of the International Monetary Fund
Schedule C - Par Values
1. The Fund shall notify members that par values may be established for the purposes of this Agreement, in accordance with Article IV, Sections 1, 3, 4, and 5 and this Schedule, in terms of the special drawing right, or in terms of such other common denominator as is prescribed by the Fund. The common denominator shall not be gold or a currency.

2. A member that intends to establish a par value for its currency shall propose a par value to the Fund within a reasonable time after notice is given under 1 above.

3. Any member that does not intend to establish a par value for its currency under 1 above shall consult with the Fund and ensure that its exchange arrangements are consistent with the purposes of the Fund and are adequate to fulfill its obligations under Article IV, Section 1.

4. The Fund shall concur in or object to a proposed par value within a reasonable period after receipt of the proposal. A proposed par value shall not take effect for the purposes of this Agreement if the Fund objects to it, and the member shall be subject to 3 above. The Fund shall not object because of the domestic social or political policies of the member proposing the par value.

5. Each member that has a par value for its currency undertakes to apply appropriate measures consistent with this Agreement in order to ensure that the maximum and the minimum rates for spot exchange transactions taking place within its territories between its currency and the currencies of other members maintaining par values shall not differ from parity by more than four and one-half percent or by such other margin or margins as the Fund may adopt by an eighty-five percent majority of the total voting power.



6. A member shall not propose a change in the par value of its currency except to correct, or prevent the emergence of, a fundamental disequilibrium. A change may be made only on the proposal of the member and only after consultation with the Fund.

7. When a change is proposed, the Fund shall concur in or object to the proposed par value within a reasonable period after receipt of the proposal. The Fund shall concur if it is satisfied that the change is necessary to correct, or prevent the emergence of, a fundamental disequilibrium. The Fund shall not object because of the domestic social or political policies of the member proposing the change. A proposed change in par value shall not take effect for the purposes of this Agreement if the Fund objects to it. If a member changes the par value of its currency despite the objection of the Fund, the member shall be subject to Article XXVI, Section 2. Maintenance of an unrealistic par value by a member shall be discouraged by the Fund.

8. The par value of a member's currency established under this Agreement shall cease to exist for the purposes of this Agreement if the member informs the Fund that it intends to terminate the par value. The Fund may object to the termination of a par value by a decision taken by an eighty-five percent majority of the total voting power. If a member terminates a par value for its currency despite the objection of the Fund, the member shall be subject to Article XXVI, Section 2. A par value established under this Agreement shall cease to exist for the purposes of this Agreement if the member terminates the par value despite the objection of the Fund, or if the Fund finds that the member does not maintain rates for a substantial volume of exchange transactions in accordance with 5 above, provided that the Fund may not make such finding unless it has consulted the member and given it sixty days notice of the Fund's intention to consider whether to make a finding.

9. If the par value of the currency of a member has ceased to exist under 8 above, the member shall consult with the Fund and ensure that its exchange arrangements are consistent with the purposes of the Fund and are adequate to fulfill its obligations under Article IV, Section 1.

10. A member for whose currency the par value has ceased to exist under 8 above may, at any time, propose a new par value for its currency.

11. Notwithstanding 6 above, the Fund, by a seventy percent majority of the total voting power, may make uniform proportionate changes in all par values if the special drawing right is the common denominator and the changes will not affect the value of the special drawing right. The par value of a member's currency shall, however, not be changed under this provision if, within seven days after the Fund's action, the member informs the Fund that it does not wish the par value of its currency to be changed by such action.

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Articles of Agreement: Schedule C - Par Values