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

Originally Posted by Gloribee

$1.23 Eruo, just remember this is not confirmed, I'm still checking. Hoping by the end of Monday to have more Info from my source, who is low level banking in Iraq. Please!!! No Pm's

Thanks, gloribee

attempting to give you multiple thanks lol always fun to hear stuff like this

Okay, I have asked for opinions about that article stating that the exchange rate will be 1000dinar/$1.

After all these posts, IT IS CLEAR:
- The author of the article is not an expert
- If I have to choose between what this article says ( 1000:1) and what "an official from CBI" says - that " the dinar will/should be the currency of choice" - meaning that the dinar will be equal if not higher than the dollar, then I will have to go with the second one.

Why?
The second one comes from CBI - and this is the most important thing

I like it more - who does not?

Makes more sense as a solution to the problems in Iraq - while the first one does not

Obviously we should put that article to rest. I got scared for a moment there, but hey, thanks to you guys, I am good now! :)

Originally Posted by Linus/intense

If the rate dropped to 1,000 IQD to 1USD.. it is a 34% increase in value... but a double digit increase in inflation and two points on the lending rate ??? no way... you would slide into a depression and never get out, especially if you opened the doors for business, for the internantional community. Iraq is for sale then... what a bad opinion piece...

sheeeshhh..
:(

For those who are interested in Capital Hill rumors... there has been talk about "when is Maliki up for re-election ??" ... but I could't imagine who you would replace him with...

Exactly,

That is how I see it as well. 34% increase in dinar value is far from the value it was before Saddam was ousted, and given the huge differences from then to now, never mind the reduced debt, and loan guarantees, something that was not even close when Saddam was in power, how can it be less than .31 is the question I would pose. This would seem to be the most logical starting point is to simply resume the former rate which would appease all as I see it. Certainly from there, it could rise as the infrastructure improves to support higher rates.

As to who would be better suited to lead Iraq as PM, talibani or Barzani would be my choices. They have to have someone in this position who is not on his knees with Sadr City militia kissing their a$$es as Maliki is. Since both shiite and sunnies cannot get along, then put Kurd's in power. (g)

Good luck to all, Mike

Originally Posted by Gloribee

$1.23 Eruo, just remember this is not confirmed, I'm still checking. Hoping by the end of Monday to have more Info from my source, who is low level banking in Iraq. Please!!! No Pm's

Thanks, gloribee

Thank you for info, gloribee.

Could you also ask if your source knows anything about when - date estimated to happen, etc- ?
Don't forget!!

Originally Posted by Gloribee

Sorry to break your heart Charmed, but it's not going to open at $1.47.......

It's going to be higher!!!!! I'm sure your going to get over it

Gloribee

YOU JUST ABOUT SCARED THE DINAR OUT OF ME......UNTIL I READ THE HIGHER PART......I like your idea better.....let's go for 1.47 or better yet HIGHER

So, we have an opinion out there that says the dinar will go to 1000 to 1.

This level of exchange concerns me for a several reasons:

1. I don't think the CBI would have removed such large amounts of dinar just to RV at such a low level. They could have just "adjusted" the rate and be done with it. While it may seem commonplace for many, in the world of currency, for a country to be able to remove such large amounts in a short period of time is REMARKABLE! And, they still have currency reserves around 12 Billion. The amount of currency they have removed predicts a much higher level than 1000 to 1. This is an extremely rare situation. Most countries are unable to mount such an aggressive intervention. Most just keep printing money and inflation goes on and on....

2. The CBI needs to control inflation. Raising interest rates is a common practice that our Fed has done over the last couple of years. It does NOT harm the economy. It is a method to "cool" the economy and is considered another method to decrease the base money supply. Not as dramatic and not as immediate as a direct intervention of exchanging currency reserves for currency in circulation, and it takes more time to be effective, but an effective tool just the same. Again, it demonstrates that the CBI has a plan.

3. At the 1000 to 1 level, this is within the range of what I would think would just "undo" the currency removal that has taken place. If they did this, all they would have accomplished would be to alert every currency trader, international bank, corporation and speculator that the currency was still too cheap (10 dinar to the US penny) and the demand could/would be greater. So, the level will need to be higher so as not to pump more dinar into the economy and as we said, raise the purchasing power of the iraqi people to allow them to buy goods made outside of iraq. (an maybe increase their confidence in the GOI. I hope this OPINION is helpful. Thak You

The American embassy in Amman : the meeting between Bush and Al-Maliki next Thursday
Amman - (Voices of Iraq)
The American embassy in Jordan today, Sunday, that the American President George Bush will arrive Amman on Wednesday 29 November Novmir meet Iraqi Prime Minister Nuri al-Maliki on Thursday, 30 of this month.
The embassy added in a statement received by news agency (Voices of Iraq) independent copy that Bush and Maliki will hold a press conference following their talks.
The meeting of Bush and Al-Maliki with growing pressure on Monday to move decisively to prevent Iraq sliding into a civil war or a state of chaos has a tremendous future state of instability in the entire region.
It also comes after the historic visit by Syrian Foreign Minister Walid Muallim to Iraq was the first visit by the Syrian minister of the country since the American invasion of Iraq in 2003 and culminated in an agreement the two countries to resume their relations after a break that lasted about a quarter of a century.
."And Tony Snow said White House spokesman told reporters last week that Bush will hold talks with al-Maliki focused on the efforts of "the building of security and stability in Iraq."
."He added in a statement : "Our discussions will focus on current developments in Iraq and the progress achieved so far in the deliberations of the joint committee at a high level on the transfer of security responsibility and the role of the region in support of Iraq."
The chaos in Iraq put increasing pressure on both Bush and Maliki to try to find a way to stop the killing.
The United Nations announced on 22 this month that the number of dead Iraqis had risen to a new level in October last October, and more than 2 million people displaced from their homes since the American invasion of Iraq to escape the violence sweeping the country.
Figures revealed in the report of the United Nations based on the data of the Iraqi Ministry of Health that the number of dead civilians were killed in the 3709 October 3345 deaths rise in September. In July the number of people killed in July 3590 killed the largest number recorded before.
And resentment of the Bush Administration's policy in Iraq was a key issue in the election term renewal to the American Congress, which took place earlier this month and toppled the control of his Republican Party to Bush's Congress.
The talks between Bush and al-Maliki first lengthy talks between them since President Bush promised that the new orientation in Iraq after the victory of the opposition Democrats, and their domination over Congress. It also comes after a month of speaking Monday to ease tensions after the appearance of narrow from both sides of the functioning of the other to stop the violence in Iraq. And the Americans pressed politicians, especially Democrats for the withdrawal of American forces from Iraq.
It urges allies of the United States, Bush had to have a dialogue with Iran and Syria on Iraq.
Stephen Hadley, national security adviser to the White House, that the Bush administration had no objection to the improvement of relations between Iraq and Syria and Iran.
He added, "We believe it is important to talk directly to Iraq and that those two countries to show them that they can play a positive role in the search for security, stability and democracy in Iraq."
Awaiting Bush and recommendations on Iraq is expected to be issued next month by a committee chaired by the former American Secretary of State James Baker and former Congress member Lee Hamilton. The Ministry of Defense (the Pentagon) audit part of the approach in Iraq.
Translated version of http://www.aswataliraq.info/modules.php?op=modload&name=News&file=index&startn um=31

Originally Posted by $onedaysoon$

Economists and academics warned Iraqis of the consequences of the growing problem in Iraq about inflation rates but extremely dangerous and scary as they hit during the month of August last 76%, which economists Iraqis seen as representing the major illnesses. This comes due to suspension of most of the productive sectors and the continuing fuel crisis in addition to plenty of cash flow. Economists and interested in this area emphasize the importance of moving the process of comprehensive economic reform, because inflation is one of the reasons behind the Iraqi economy and faltering considering that not a cure for inflation only through the processing and activation of all productive sectors, whether industrial or agricultural or service. Therefore, the activation of these sectors is one of the solutions to the problem of inflation, which began an excessive burden on the Iraqi citizens and Iraqi family and the diminution of well-being and prosperity of society. Dr. Ali Baban, the Iraqi Minister of Planning said : (The figures for the case of serious inflation is a state of ill Iraqi economy and the deterioration of the situation in the productive sectors should be addressed as soon as) saying : (It is not a cure for inflation only improvement in the Iraqi economy and the overall improvement of productive sectors and to address the problems that face). continues : (Inflation is not caused by one single factor, but it is an indicator of poor Iraqi economy a whole. If the state of the economy should not be a virile inflation and inflation if it is limited).
He added : Papan (I hope that everyone of inflation seen from the perspective of a holistic sense to look at through the reality of the economy and not by the fact that monetary policy only monitors the amount of money and the money supply, interest rates and credit policy, etc.) explaining : (monetary policy that inhabit disease and Ataaljeh When we discount rate or Nkhfedah follow the policy of strict or lenient credit, we will try calming the disease and Anaaljeh. and the disease is in the productive sectors and the state of the economy in general and if the productive sectors remained unchanged do not expect a decrease in the course of Altdkh m or decline it. If evolved these sectors and recovering agricultural sector and the industrial and service when it begins to revolve the wheel of economy and inflation will retreat. ( The Papan to : (The credit policy will play an important role in the treatment of inflation and this issue must be known to all, We do not expect that the Central Bank reduced rates when credit or picks will succeed in controlling the phenomenon of inflation problem is not confined to the private credit and Avi issue of balance between the quantity of money and money supply, but only in the productive sectors, In the Iraqi productivity. This is the other dimension of the issue, the productivity of "individual" back Therefore, the unemployment closely related to inflation). For his part, Dr. Kamal Basri, undersecretary of the Ministry of Finance and head of the Iraqi Center for Economic Reform : (a phenomenon that "inflation" came out of an abundance of liquidity in the cash with the scarcity of the goods and services. The abundance of liquidity in the cash came from this year's budget allocated amounts of cash many of the salaries and wages increased about 90% from what it was last year ... This pumping major financial market. while the goods and services in the market b Jae less for a variety of reasons, including security and why this factor making markets confused, in addition to the transit of goods from the border outlets became very agitated because of the security factor as well). He adds : (Also, the lack of fuel contributed to the reduction of existing goods in the local market. in addition to an abundance of cash to the individuals caused a rise in the prices of the deal, we believe that the security situation is essential for each case).
He stressed the work to encourage the State to end the monopoly of the Ministry of Oil import and sale of oil derivatives, and need to give space to the private sector to fill the existing gap. )...He stressed the need for the optical link the issue of reforming the state oil derivatives in a series of actions : (It is not enough to make the step and leave the remaining steps) ..The prices of oil derivatives, reform is necessary and correct, but must be accompanied by an integrated program to protect the poor ... (We also need to support the services of water, electricity, transportation and others, Without this reform be extracted and integrated and affect the economic well-being of citizens). Basri said : (What is the percentage of high inflation is frightening, Therefore it has become necessary for the State to the linking production spending. If the conditions the same, I believe that the inflation rate in the next month would be high). As Abdullah Albandar member of the Iraqi Center Director in the Economic and Finance Ministry, indicated that the inflation rate reached last August, 76%, a figure that seriously The ratio of inflation between the seventh and eighth month last by fluctuating between 26-20% and this is very dangerous, if the rate of inflation without a high rates of economic growth, this would constitute a problem. The appearance of Dr. Mohamed Saleh, director general of the Economic Iraqi Central Bank has pointed out : (The three elements in the Iraqi economy, inflation is at the center rents have risen to the rate of inflation up to 41%. food rose in July to 23% and the fuel is also up to 19% and the rest ratios are 14%.
Saleh said : (Iraqi economy suffers from a structural imbalance due to the domination of the oil sector and some other sectors. The essential point that the draft reform of the State generate vibrations on the old traditions (the support), as everyone knows, the direct and indirect constitute 80% of national income in Iraq, this strange phenomenon in the world ... Therefore, any response to this support generates Thus imbalances In my opinion, would not be a solution to this matter but to solve the problem of unemployment and build the priority projects that could absorb unemployment and generate economic activity and housing projects which they constitute 20% of the labor force Iraqi). He adds : (Under these circumstances, if control of the prices of oil derivatives has been working on ration cards for a certain period of a couple of distribution then the market would be reassured by much of this to be a growth and some monetary reforms to control the money supply that accompany inflation).
أكدت أنها مازالت تعكف على بحث جميع الخيارات المتاحة للإدراجShe added that she is still bent on considering all the options available for inclusion
Translated version of http://www.baghdad-newspaper.com/ar/06/m11/8/p5.html

So, if I understand this even a little bit, it sounds like the solution to inflation and poverty and lack of production has to be a multi-pronged effort: RV has to be accompanied by a form of public works program which will put laborers into physically rebuilding the infrastructure (roads, water, power, telecommunications, agriculture) and as these people spend their pay, the economy and GDP gets a shot in the arm and as this continues, those of the working class who aspire to will break off to begin their own businesses and the economy will begin recovering. In the meanwhile, all three factions will be working side-by-side, earning one another's respect if not just tolerance while they are all invested in the unity of their country. While this occurs, trade doors have been open to surrounding nations who become cheerleaders for Iraq's success because they too profit economically and on a humanitarian basis. They've tried so many other ways of bringing down inflation, so they cannot now be faulted for revaluing the dinar. They have oil to back it, and a whole world holding its collective breath ....Can't tell me that there are more naysayers than cheerleaders, now! C,mon! RV!

So... my brilliant mind has deduced, after countless permutations , truncated algorithms, and angles squared by pi, that there probably wont be a an auction result for today posted at cbi.... time for a Guiness then. Brilliant!

Originally Posted by Jola

Okay, I have asked for opinions about that article stating that the exchange rate will be 1000dinar/$1.

After all these posts, IT IS CLEAR:
- The author of the article is not an expert
- If I have to choose between what this article says ( 1000:1) and what "an official from CBI" says - that " the dinar will/should be the currency of choice" - meaning that the dinar will be equal if not higher than the dollar, then I will have to go with the second one.

Why?
The second one comes from CBI - and this is the most important thing

I like it more - who does not?

Makes more sense as a solution to the problems in Iraq - while the first one does not

Obviously we should put that article to rest. I got scared for a moment there, but hey, thanks to you guys, I am good now! :)

So good! So Good! You got DINAR!!! nah-nah-nah-nah-nah-nah-nah!!! Wooh! Great discussion-provoking question there!