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

Originally Posted by neno

I will make it Quick. Click the Last Line in my Signature in RED. Thanks for being a RolClub Member. This will Help Rolclub Members that have NO CHASE BANKS.........

I dont post much, but I just wanted to say this to you. It is very nice of you to go thru all that trouble to set this up for the membership at this forum. I have had trouble getting orders too with a Chase Bank. I use SafeDinar with no problems. But know you got us a Dealer that will give a discount for more Dinars for the money. Thanks again for all you and your Team at Rolclub do.

God Bless,
Vivian

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Bush seeks advice on new course in Iraq By BEN FELLER, Associated Press Writer
8 minutes ago



WASHINGTON - President Bush, eager to show he can take advice on Iraq, embarked on a round of public outreach Monday and promised Americans the unpopular war eventually would make their lives safer.

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Preparing for a major speech on the war's future, Bush took the short trip to the State Department to review options with advisers there, then hosted a handful of experts on Iraq policy in the Oval Office.

"Like most Americans, this administration wants to succeed in Iraq because we understand success in Iraq would help protect the United States in the long run," Bush said after his State Department briefing.

FULL STORY FOLLOW LINK:

Bush seeks advice on new course in Iraq - Yahoo! News

Iraqi VP criticizes nation's security By HAMZA HENDAWI
1 hour, 25 minutes ago



BAGHDAD, Iraq - Iraq's Sunni vice president said he plans to tell President Bush of his "dismay" over the Shiite-led government's handling of security during their meeting Tuesday in the White House.

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Vice President Tariq al-Hashemi accused the government of not doing enough to deal with militia attacks and said he was especially concerned about Baghdad, where Sunni-Shiite violence has flared in several neighborhoods in recent days.

"Slow and inadequate action is a problem that we have been facing with this government since it was formed," al-Hashemi said Monday in an interview with Baghdad TV, the mouthpiece of his Iraqi Islamic Party.

Al-Hashemi, one of two vice presidents, has been a sharp critic of Prime Minister Nouri al-Maliki's government. He has recently been joined by senior Kurdish and Shiite politicians, some from within the ruling coalition, in what is by far the most intense anti-government campaign since al-Maliki took office in May

FULL STORY FOLLOW LINK:

Iraqi VP criticizes nation's security - Yahoo! News

WASHINGTON, DC, United States (UPI) -- A top U.S. general in Iraq said two critical things need to happen to turn around the violence in Iraq: jobs for the vast number of unemployed military-age men and political reconciliation between Sunnis, Shi`ites and Kurds.

Political reconciliation could start with the announcement of provincial elections, which would give Sunnis a voice in a government from which they feel mostly excluded and in some cases, harassed and persecuted by since Shiite militias have infiltrated some police units.

'I think it`s a critical element when it comes to reconciliation,' said Lt Gen. Pete Chiarelli, commander of Multinational Corps Iraq. 'The new announcement of the date for those elections would have a tremendous impact in many of the Sunni neighborhoods.'

A massive program to create jobs would drain the pool of men who now populate militias and insurgent cells, he said.

'Employment is absolutely critical to what we`re doing to take the angry young men off the street,' Chiarelli told Pentagon reporters in a videoteleconference from Baghdad on Friday.

'I definitely think there`s an opportunity to turn things around. There`s no doubt in my mind there is. I definitely think that this is winnable, but we`ve got to do those things that are necessary and ... help convince the Iraqis that it`s not just the military alone that will solve the problems that face them,' he said.

'If we set up a series of goals, goals that are tied to dates of certain critical things that have to be done to make all the Iraqi people believe that this is a government of national unity, that we could regain their confidence, and anything is possible,' said Chiarelli.

Chiarelli said the United States is winning the war in Iraq militarily, but has faltered on the political and economic fronts.

'I happen to believe that we have done everything militarily we possibly can,' he said. 'The Iraqi army gets better every day. But I really believe the key to this conflict is to understand that it`s going to take more than military action to solve the problems that face Iraq and to pull people together. It`s going to take working along with other lines of operation, the economic and the political lines of operation, the reconstruction line of operation, to give Iraqis hope for their future.'

Chiarelli is completing his second year-long command tour in Iraq. The first one ended on a high, with the first national election in 2005.

It is one of the ironies of this war that a military leader known for his embrace of the 'softer side' of counter-insurgent campaigns (political and economic progress and improving basic living conditions) has been unable to implement much of that this year.

'I know I am leaving Iraq in a more uncertain and somewhat more tumultuous state than the last time I left,' Chiarelli said.

The year 2006 in Iraq turned on the February bombing of the Shiite Golden Dome mosque in Samarra. That inflamed sectarian divisions and violence Chiarelli said he had not seen during his first deployment in 2004.

'In my two years here, there`s not been a single more definitive event that seemed to have changed the way Iraqis looked at themselves and looked at their country,' he said.

Chiarelli said the situation would be 'far worse' if U.S. troops were not on the streets of Baghdad every day.

Looking back on a year that has gone distressingly against American forces, Chiarelli told Pentagon reporters the United States must change the way it prepares for and fights wars.

'We need to get out of thinking this is solely a military conflict where we must simply apply more U.S. or coalition and Iraqi forces against an enemy that we can destroy. All our nation`s strengths -- diplomatic, economic, political -- must be leveraged to help the Iraqis find their way through this process,' said Chiarelli.

'We should not give in to the defeatist mood that I sometimes see displayed. This mission is the most critical and significant that we`ve undertaken in perhaps 50 years, and failure, in my opinion, is not an option,' he said. 'I still believe the mission can succeed if the proper resources are brought to bear at the issues at hand.'

He said the Iraq war should serve as an object lesson for the kinds of future conflicts the United States is likely to face.

What is needed is a federal government that leverages not just the military but all of its capabilities -- from banking and financial to agriculture and business -- to get Iraq on its feet and functioning.

'I know that is uncomfortable for a lot of people both in and out of uniform who were raised on the concepts of destroying a certain portion of the enemy`s forces and declaring victory. This conflict will take all efforts in government, economic development and transition working together. I believe that the days of these kinds of conflicts are over,' Chiarelli said.

However, the contribution in U.S. government personnel to these tasks has been paltry compared to the 1 million troops who have rotated through Iraq in the last three years.

Outgoing Defense Secretary Donald Rumsfeld, in a memo leaked to the New York Times, expressed frustration with the government`s inability to mobilize its civilian experts.

The Nov. 6 memo called for aggressively beefing up U.S. advisers in Iraq civilian ministries by tapping the pool of retired military officers, 'i.e., give up on trying to get other U.S. government departments to do it.'

But just getting political and economic help from the United States will not change Iraq now, Chiarelli admitted.

'In order for these things to succeed, however, we need a commitment by all Iraqis of all the ethno-sectarian groups to commit first to non-violence and to resolving their differences through the political process. We need, quite frankly, to move toward reconciliation. Iraqi citizens must feel that their government is a genuine unity government that is working for the benefit of all its people,' he said.

'I definitely think that this is winnable, but we`ve got to do those things that are necessary and convince, help convince the Iraqis that it`s not just the military alone that will solve the problems that face them,' he said.

Copyright 2006 by United Press International


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That's Interesting...Dec 12th, 2006 - 01:04:01

...mostly because one should then ask the question 'what were they working at BEFORE the war? Answer: patronage. Iraqi Sunni society was a trickle down system of patronage, indentured servitude, etc. There was a merchant class, but vast numbers of folks had money from Saddams machine trickle down to them. Hardly a sustianable model for a free nation.

Iraqi GDP is way, way up. Personal wealth is way, way up. If you secure the provinces, society and economic growth will flourish.

sorry, I think this has been posted already


Iraqi dinar builds head of steam amid nation's chaos
The currency nears its peak value since being reissued in 2004. With the state buying to curb inflation, the strength may be temporary.
By Molly Hennessy-Fiske, Times Staff Writer
December 11, 2006


BAGHDAD — An unexpected bright spot has appeared in this war-ravaged Iraqi capital: The national currency is strengthening against the U.S. dollar.

The dinar has appreciated to about 1,400 dinars to the dollar, near its two-year high, triggering a dinar buying frenzy among currency traders.

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"I had people call to sell $150,000, $100,000. I had to tell them I didn't have that many dinars," said Alaa al Shemry, deputy manager at the Beirut Exchange Co., where he sat last week, watching a man sell dollars for the blue 5,000-dinar notes adorned with waterfalls and desert fortresses.

Economists and investors say the dinar's rise is temporary and largely driven by the Iraqi Central Bank, which is buying the currency as it seeks to raise interest rates to combat rampant inflation.

But that hasn't stopped currency speculators from seeking to cash in.

A.F. Alhajji, an associate professor of economics at Ohio Northern University who has studied the Iraqi economy for 15 years, received e-mail from Mideast currency speculators urging him to buy Iraqi dinars, similar to messages he got after the dinar was issued in 2004.

Alhajji says he watched teenagers in Jordan and Saudi Arabia respond to the e-mail, buying up the currency.

"They seriously think they can gain money by buying Iraqi dinars. This has become like a fever over there," he said.

And not just over there.

In Danbury, Conn., Jeff Pasquarella is buying billions of Iraqi dinars for customers through his currency trading website, Bet-OnIraq.com, which sells the Iraqi currency "because liberty breeds prosperity." EDinar Financial in Los Angeles and similar companies have popped up from Nevada to Wisconsin.

At Dinar Trade in Brentwood, Tenn. (formerly Bakersfield), sales dropped off during the last few months but picked up again in the last two weeks as many of its 54,000 customers took a renewed interest in the dinar, an employee said. The company expects the dinar to appreciate 10% to 20% in value.

"Picture Iraq as a company selling stock," the website says. "Each Dinar you purchase represents a share in Iraq's bright future."

On Thursday, the last day of business in this largely Muslim country, the dinar was trading at 1,424 against the dollar, according to the central bank. That was its strongest price since March 2004, when it was 1,420.

Some economists are surprised at the dinar's rise, considering that Iraq's economy is still a shambles, with trade and major industries such as agriculture and oil crippled by the ongoing conflict.

Electricity is so sporadic in the capital that the Iraq Stock Exchange — which is preparing to switch from erasable white to electronic boards on the trading floor — can still count on only two hours of power a day.

In late November, three car bombs exploded in markets near the central bank, killing at least 68 people, injuring 111 and destroying 22 businesses, police said.

The dinar's price is determined at streetside foreign exchanges and daily dollar auctions at the central bank. Each weekday except Friday, the Muslim day of prayer, traders from 30 state-run and private banks arrive at the central bank in downtown Baghdad, each bearing an envelope listing the amount of dollars they wish to buy and a bid price. Bank managers confer and set the price.

The central bank is widely believed to be trying to force the exchange rate down to 1,000 dinars per dollar, in line with the Saudi riyal and the Jordanian and Kuwaiti dinars.

Ahmed Salman Jabouri, the deputy central bank governor who oversees the foreign exchange market, said Iraqi banks were buying up dinars, reversing a recent trend.

Under a multiyear agreement with the International Monetary Fund, Iraq is required to increase its dollar reserves and bring inflation down to 15% as part of the nation's reconstruction effort. During the last two years, the bank's dollar reserves about doubled, records show, now totaling about $11 billion, while inflation has leaped this year, Jabouri said.
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An IMF report in May showed inflation of 58% during the previous 12 months, compared to 31.7% the year before. Economists and investors put current inflation even higher, at up to 80%.

A Western official in Baghdad said the Iraqi government is doing all it can to fight inflation.

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"They're basically meeting their targets," said the official, who requested anonymity. "I think this is actually a good thing for Iraqi consumers."

Most Iraqis receive oil and food subsidies but struggle to pay for cars, computers and other items, said Laith al Abadi, 30, a computer engineer who was exchanging dollars for dinars at the Beirut Exchange Co. last week. Abadi said he imports PCs on the black market to avoid taxes and keep his prices low — $300 to $1,400 for a basic model.

"If something changes, if the market is OK, then I pay taxes," he said.

Investors were more upbeat last week at the stock exchange, where 93 stocks appeared on whiteboards. In a stucco building behind an armed checkpoint and concrete barriers, men fingered prayer beads as they waited for the exchange to open. Some said they are more confident that the central bank can curb inflation as the dinar's value rises.

"It's a sign of stability because you are going to have capital that has fled the country coming back," said Saad Lutfi, 64, a trader who mostly invests in the banking sector, which he said is picking up. "But it's a long-term thing."

Alhajji, the Ohio economist, said Iraqis were following the bank's lead, exchanging dollars for dinars.

"People historically, since the days of Saddam Hussein, saved their money in non-Iraqi currency. Since the U.S. came, it was the U.S. dollar, especially since the military was paying in dollars," he said. Now people believe the economy is improving and will keep buying dinars, he added.

Even with prices rising, U.S. soldiers in the streets and bombs in the markets?

"Sometimes high inflation is a sign that the economy is picking up," Alhajji said. "In Dubai, inflation is rampant, but it is one of the most prosperous places in the world."

But Iraq is no United Arab Emirates. The Dubai skyline is dotted with construction cranes, while Baghdad's high-rises are pocked by mortar rounds. Iraq emerged from Hussein's rule with $125 billion in international debt, pared down to $76 billion, and trade ties weighted heavily in favor of foreign countries, chiefly the U.S.

Add to that the complications of post-colonial currency shifts.

After World War I, when Iraq fell under British rule, the official currency was the Indian rupee, with rates set by the empire. Once Iraq gained independence in 1932, leaders created a national currency board to set exchange rates for the dinar but not shape monetary policy.

Under Hussein, the exchange rate fell from $3.30 per dinar to a low of 3,000 dinars per dollar in 1995 as the government, bedeviled by international embargoes, massively printed old dinar notes, including those emblazoned with the dictator's likeness.

The new central bank was created with U.S. and British oversight in part to help stabilize the dinar. Some say the currency's rise amid the sectarian war is the result of the bank's dysfunctional money management.

"Given their history with money in Iraq, they should never have had a central bank," said professor Steve H. Hanke, co-director of the Institute for Applied Economics and the Study of Business Enterprise at Johns Hopkins University in Baltimore.

He said Iraq should replace the central bank with the currency board it had before or adopt a foreign currency. Ecuador, El Salvador and East Timor have adopted the dollar, he noted, while Montenegro and Kosovo use the euro.

Hanke called the dinar's rise "both very dangerous and the worst of all possible worlds" because it is not curbing inflation.

"This is a major train wreck waiting to happen," he said.

The head of the Iraq Stock Exchange, Taha A. Salam, said the dinar will inevitably decline in value. When it does, he said, "you will have more problems in the streets" as Iraqis' buying power wanes.

Shemry, the exchange dealer, advises clients like Mudhaffar Jenari, an employee at the Ministry of Oil, to keep their dollars as insurance against further unrest. Just a few months ago, a car bomb exploded up the street, wounding the owner of another foreign exchange shop and killing an employee. After the blast, thieves stole $40,000.

"Everything depends on the security situation," Shemry said.

This is true for the dinar as with everything else. "One thing goes badly, and we lose everything."

Iraqi dinar builds head of steam amid nation's chaos - Los Angeles Times

Originally Posted by Dinar Cha Ching

I believe you were right originally because Jabar specifically said the $41 billion budget "is based on a 1260 dinar rate". A $41 billion dollar budget is realistic once the dinar is approaching or passing parity.

Someone please correct my math if wrong but IF and that's a big IF Jabar meant 41 billion dinar for the annual budget, wouldn't that equate to only $32,539,683usd? (1 billion = 1,000,000,000 / 1260 proposed usd rate = $793,651 usd X 41 bil = $32,539,683 usd)

If this premise is accurate, there is obviously no way they could run Iraq for 2007 on less than $35,000,000 usd. No way, no how. My calculator can't go to the digits needed to convert $41 billion usd into dinar @ 1260. This value has to jump substantially for Iraq to fund their 2007 budget. JMO.

The adviser to the Ministry of Labor and Social Affairs Iraqi Abdullah Al-Alami, the consent of the Iraqi government to increase allocations for the social protection network in 2007 to 1500 billion Iraqi dinars, and start lending to poor families and the unemployed to set up small enterprises. He told Al-Alami in the Middle East «», that the variance is three times the figure allocated within the budget in 2006, in order to include the largest possible number of social protection network program, and also set up small businesses that operate from 1 to 9 workers at the highest. He continued, and plans for 100 thousand of lending without interest, and this project will provide an opportunity for the operation of the limits of 300 thousand unemployed
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It is hard to believe that some investors really think that US company profits can continue to merrily rise ever upwards with automobiles, housing, manufacturing and retail showing severe signs of strain. Or that the devaluation of the US dollar will not precipitate some kind of an asset sell-off as it did in 1987, as who wants to own assets valued in a depreciating currency?

Yet such is the madness of crowds and hyperbole of analysts that it is perfectly possible that the Dow-Jones could enter 2007 with a fresh all-time high. But this can not last, and by the spring at the latest Wall Street will find itself in serious deep water.

Now when the US catches a cold the rest of the world catches pneumonia. China is one-tenth the size of the US economy and can not provide an alternative motor for the global economy, besides it is very dependent on US exports. The Indian economy is smaller.


Now where to hide
Europe is already worried about the devaluation of the US dollar and the impact on the competitiveness of Airbus, for example. And Japan's anemic economy will be sorely tested.

So don't invest in global equities, mutual funds or even private equity for 2007. This could be a very rough year for equities and that also goes for Arabian stocks which will suffer from another side effect of the crumbling US economy: lower oil prices.

Oil producing countries can expect to see significant revenue falls in 2007 as global demand for oil will drop at a time when oil stocks are rising strongly. This will also be bad news for Arabian real estate, particularly off-plan speculation which has boomed on the back of high oil prices in recent years.

US Treasuries should fare better as a sell-off in equities will help rally or maintain the value of the US dollar while the Fed will doubtless cut interest rates in the wake of trouble on Wall Street and thereby boost bond prices.

It is arguable that hedge funds might perform well in a volatile year. But as we have seen in 2006 with energy price volatility that theory does not always work in practice; and a seven per cent average return for hedge funds in 2006 was hardly more than a risk-free bank account.


Avoid hedge funds
In a crash the multi-trillion dollar derivatives market traded by the hedge funds could come seriously unstuck, and could in extremis turn a recession into a depression. So avoid alternative asset classes like hedge funds like the plague.

In cash is perhaps where investors ought to stay for 2007. There is a risk of further US dollar devaluation, although a dollar rally would follow if asset prices undergo a strong correction as this article argues looks inevitable. We saw this in May this year.

The other option is to diversify into precious metals, although as next week's column will suggest it may be better to wait until the second half of the year because in a commodities slump gold and silver would also fall in value. But equally precious metals would usually be the first asset class to rally after a major global sell-off.

Iraq faces a failure to spend billions of dollars of oil revenues earmarked for the reconstruction of roads, schools, power stations and repair damaged oil refineries and oil pipelines. Iraqi ministries and spent a total of 15 per cent of its budget for 2006 received for the purposes of reconstruction, with the least expenditure cases in the Ministry of Oil, which depend on pipelines and oil pumping stations destroyed or damaged often for the transport of oil, which provides almost all the country's revenues, is essentially available funds, but the Iraqi regime is not capable of investing.
العقود.The country faces this failure in the national spending even when scarce financial support American Among the causes of the problems strange new problem in terms of staff and bureaucrats are afraid Mchochon action against corruption which have been put into practice by the American and Iraqi governments, so they are afraid to sign the contracts.

وي.And the inability to put money spending serious questions to the government that they have to demonstrate to the citizens skeptics of government corruption that they were able to improve basic services, and that they could, at a time of shrinking American funds earmarked for reconstruction, to demonstrate to other foreign donors that they can use the funds had been pledged by getting ready to use quickly.

ن .After spending nearly 22 billion dollars taken from taxpayers Americans in the reconstruction in Iraq and he consider to increase the budget of Iraq by many as proof that the oil revenue can finally begin to provide funds for reconstruction, after four years of the Bush administration expectations that the country can be accomplished his own program.

».Recognition has been a slight problem in the report of a study group «» American Iraq last week, which gave similar figures on spending, and said that «many of the ministries can not do much more than pay salaries».

.In interviews officials said Western and Iraqi spending has increased during the last three months, as the government began to take steps to improve their performance, and said those responsible that in a country that needs reconstruction in all fields could explain the lack of spending by factors including rapid change in governments and security difficulties and the rampant corruption and the lack of qualified technocrats in tasks such as signing contracts and complex project management. Also facing those responsible for the fight against corruption, loss of support, and to reflect that in the case of Radi Radi chairman of the public integrity, who was hearing in private meetings by Iraqi officials and Western intolerance and political bias and other flaws.

.A letter addressed to Prime Minister Nuri al-Maliki to Nadi on September 6 (September), and include a charge comparable to the right of corruption Balradi himself, was delivering a copy of the letter to the New York Times, the Prime Minister confirmed that hundreds of thousands of dollars spent without documented by the same integrity.

لكن».But carp spokesman Radi Radi insisted that the first letter confidential and that he could not discuss the content, but in the latter refused to accept the charges, saying that it was not based on correct information. He pointed out that the carp remain functioning in spite of the pressures to which they are exposed, and stressed that international donors who provided funding for Iraq have so they are confident «ensure that the existence of institutions overseeing the disbursement of funds».

».And while it became clear that it is unlikely to gain financial support without an effective campaign against corruption, the failure of Iraq to spend money undermines the letter, which says that in the latter country will be able to use the external support that was provided to him. He said Yahia Said «researcher at the London School of Economics», which acted as an adviser to the United Nations that «people who try to deal with them and obtain additional funds for Iraq would return us to say : Iraq does not currently being spent confiscation of private». For his part, put Hussein Shahrastani oil minister new measures to combat corruption over those imposed from abroad, and said that the solution is to teach bureaucrats how to cope with the new rules, and criticism from organizations concerned with combating corruption, he said Shahrastani «certainly I have heard all the complaints. I do not think it went far. And I think that this is necessary when considering the level of corruption that we inherited ».

قود.The budget for Iraq in 2006 to about 32 billion dollars and is expected to reach $ 40 billion in 2007, according to a statement Gabr, and the Finance Minister, in an interview with him. And spent most of the funds coming mostly from oil field expenditures, including spending eight billion dollars on salaries and retirement ministries and six billion dollars on the food system like the socialist system with compensation for food and fuel.


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