Thread: The Latest Negative News on the Iraqi Dinar...

If you have a point to make on the Dinar that may be contrary to the idea that "everything is coming up roses", feel free to post it here. I'm sure some will come visit you to argue their point. Everyone is to keep it to the facts and leave personal attacks and vulgarities at home.

Everwiser

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A statement by B.J. AL Zubaidi, the Minister of Finance, in which he said that he had suggested to the Chairman of the Central Bank, Dr. Sinan AL Shibibi, that three zeros be taken from the Iraqi Dinar in order to raise its value so that one Dinar be equal to a Dollar. He explained that the financial authorities were set on holding a meeting next month to discuss the matter.

I don't know but the way I read this is they want to take 3 zeros from the Iraqi Dinar, as I take it a 10,000 note would now be 10.00, a 1,000 note would be 1.00. It realy does not state that they are taking 3 zeros from the value, but are from the Dinar.
So if a 10,000 note is worth 10.00 US and the value of the note goes to 3.33 than the 10,000 note would be worth 33.30

Or am I just reading into this wrong.
I'd like to buy some more Dinar, but just want some clarification

Thanks

Originally Posted by choochie

Thanks Karin,
Hopefully that puts some minds at ease.

Funny,

Yes, it will, all except XXXXX the lobber. LOL edit.-neno

Good luck to all, Mike

Originally Posted by Offshore-Wealth.com

Funny,

Yes, it will, all except XXXXX the lobber. LOL

Good luck to all, Mike

I think with XXXXX, even after the peg, he will still try to convince us that the dinar we are holding are worthless. edit-neno

Choochie, I agree with you. In the case of XXXXX, his glass is always half empty. Thats the difference between all of us. Our glass is always half full. edit-neno

Top part removed, stay on subject.-neno

Ok heres some valid points for you...

1. CBI has insufficient funds to support a rate of 1-1 regardless of what you say about faith etc. If 100 iraqis with 100 million dinars want to exchange their dinars for dollars the economy dies. Thats a pretty strong faith requirement. Id even go so far as to say that alqueda members with that much money would be able to do some serious damage here.

Not to mention all of us.

2. The iraqis would be stuffed without smaller denoms in circulation immediatley. They would have to print the equivelant amount of notes in dinar to cover people wanting change for every single 25k 10k 5k 1k all the way down to usable levels. Thats a lorra lorra notes.

3. The vast enrichment of millions of iraqis would lead to a dangerous increase in voluntary unemployment. This would cause dutch disease and have a major negative effect on the economy and the country in general.

4. The security situation over there is not good enough to stop groups of gunmen from robbing local shops for their dinar all over the country causing nation wide fear and danger should a huge reval happen.

5. The terrorists would also be enriched and would be able to purchase many more weapons and more expensive weapons on the black market to cause us trouble with. With current reports of how they are running out of money why would we want to give them more?

6. It would cause a massive cash influx to the country as people from all around jordan kuwait and us lot cash in our dinars for foriegn currencies.
This would put a tremendous pressure on the CBI to cover this amount and keep the rate stable.

7. Foreign investors would be scared off by this period of huge instability and would back off until things calmed down as there is a possibility that it could rebound. Should a huge reval happen.

8. The economy in general would be highly vulnerable and a media report of a terrorist threat or activity could cause a huge panic sell off of dinars to cash in whilst you can. Subsequently crashing the dinar.


How can you say these points are irrelevant?

These i believe are highly relevant to our investment and the situation in general.



I look forward to your response.

Originally Posted by Loops

Top part removed, stay on subject.-neno

Ok heres some valid points for you...

1. CBI has insufficient funds to support a rate of 1-1 regardless of what you say about faith etc. If 100 iraqis with 100 million dinars want to exchange their dinars for dollars the economy dies. Thats a pretty strong faith requirement. Id even go so far as to say that alqueda members with that much money would be able to do some serious damage here.

Not to mention all of us.

2. The iraqis would be stuffed without smaller denoms in circulation immediatley. They would have to print the equivelant amount of notes in dinar to cover people wanting change for every single 25k 10k 5k 1k all the way down to usable levels. Thats a lorra lorra notes.

3. The vast enrichment of millions of iraqis would lead to a dangerous increase in voluntary unemployment. This would cause dutch disease and have a major negative effect on the economy and the country in general.

4. The security situation over there is not good enough to stop groups of gunmen from robbing local shops for their dinar all over the country causing nation wide fear and danger should a huge reval happen.

5. The terrorists would also be enriched and would be able to purchase many more weapons and more expensive weapons on the black market to cause us trouble with. With current reports of how they are running out of money why would we want to give them more?

6. It would cause a massive cash influx to the country as people from all around jordan kuwait and us lot cash in our dinars for foriegn currencies.
This would put a tremendous pressure on the CBI to cover this amount and keep the rate stable.

7. Foreign investors would be scared off by this period of huge instability and would back off until things calmed down as there is a possibility that it could rebound. Should a huge reval happen.

8. The economy in general would be highly vulnerable and a media report of a terrorist threat or activity could cause a huge panic sell off of dinars to cash in whilst you can. Subsequently crashing the dinar.


How can you say these points are irrelevant?

These i believe are highly relevant to our investment and the situation in general.



I look forward to your response.

Make my keg Newcastle please.

Originally Posted by Loops

Top part removed, stay on subject.-neno

Ok heres some valid points for you...

1. CBI has insufficient funds to support a rate of 1-1 regardless of what you say about faith etc. If 100 iraqis with 100 million dinars want to exchange their dinars for dollars the economy dies. Thats a pretty strong faith requirement. Id even go so far as to say that alqueda members with that much money would be able to do some serious damage here.

Not to mention all of us. With regards to Al Queda they MIGHT have more money but with anti money-laundering regulation being so stringent worldwide these days they will STILL find it difficult (not impossible) to replenish their arsenal and armoury. Given the average wage in Iraq is VERY LOW the chances of many Iraqis having disposable funds of 100 million dinars I would have thought was quite slim. The CBI has insufficient funds to support 1:1 based on their being a complete and total run on the bank. I would think that speculators such as us are a drop in the ocean compared to world nations - and if those nations agree to not sell off their dinars until Iraq is on its feet (say 5 years) then there will be NO short term run on the bank. It may also be that the world's nations agree that the dinar they hold can only be exchanged at a pre-determined discounted rate to ensure that CBI isn't bankrupted (personal viewpoint there and definitely OPINION). You are also assuming that those 100 Iraqis would want to dump it all for US$ (or another currency) - why would they if they are nationals ?? They may wish to get some of it out of the country as a hedge but I doubt they would want to get it ALL out.

2. The iraqis would be stuffed without smaller denoms in circulation immediatley. They would have to print the equivelant amount of notes in dinar to cover people wanting change for every single 25k 10k 5k 1k all the way down to usable levels. Thats a lorra lorra notes. Right.... BUT.... printing smaller denominations doesn't necessarily increase the money supply. They could just as easily have people turn in their 25k etc notes for smaller denomination notes and coins (or bank accounts) and then terminate the 25k etc denominations - would mean NO increase in the money supply.

3. The vast enrichment of millions of iraqis would lead to a dangerous increase in voluntary unemployment. This would cause dutch disease and have a major negative effect on the economy and the country in general. That is an ASSUMPTION. Also, these people had an exchange rate of $3.22 in Saddam's term of dictatorship... were there high levels of voluntary unemployment then ? NOPE. Also, these people will have their standard of life enriched, will also have their wealth enriched - but given that their wages are so low I highly doubt their new-found wealth will be sufficient enough to retire.

4. The security situation over there is not good enough to stop groups of gunmen from robbing local shops for their dinar all over the country causing nation wide fear and danger should a huge reval happen. Fair point.. but this also suggests that the gunmen don't have financial stability, correct ?? So tell me.... how does this make it any different to any other major nation in the world ? No different, and a pretty poor argument against a reval, in my OPINION.

5. The terrorists would also be enriched and would be able to purchase many more weapons and more expensive weapons on the black market to cause us trouble with. With current reports of how they are running out of money why would we want to give them more? The terrorists will always find ways - or are you suggesting that in order to stop the terrorists we have to stop their wealth ? If so we may need to just declare the world (or at least arms and munitions providers) bankrupt..... without a reval there is just as much chance that the terrorists will be just as dangerous... because ordinary people won't have the money to support their families so will accept money (SMALL amounts) to commit bombings etc - so although I take your point about enriching them... there is also a valid view that by enriching the population that you REDUCE the terrorist activity. I would think (MY OPINION) that many terrorists are such not because of religious beliefs but because of their lack of personal financial stability (money DOES make the world go round).... so if you enrich the people you enrich the terror groups and stand a CHANCE of reducing their activity as they turn to less troublesome ways to enrich their own lves given their new-found financial stability.

6. It would cause a massive cash influx to the country as people from all around jordan kuwait and us lot cash in our dinars for foriegn currencies.
This would put a tremendous pressure on the CBI to cover this amount and keep the rate stable. Depends very much on just who owns the currency - I would think that nations abroad hold a whole lot more currency than the speculators such as us. So you should have said COULD cause a massive influx (sorry for pedantry).... but even so... it may NOT be the case - see, if the Dinar revalues are YOU going to personally travel to Iraq to cash in your dinars ?? Some might but I will go to my local bank and take their exchange rate. So again you are assuming that the banks will exchange their dinar - when it may actually be that the banks HOLD the dinar to give them banking reserves in that currency in the event that the currency further strengthens and indeed in the event that people may want to travel to Iraq and require Dinar. And this is without even mentioning the NATIONS themselves holding Dinar. So there might NOT be a massive influx.

7. Foreign investors would be scared off by this period of huge instability and would back off until things calmed down as there is a possibility that it could rebound. Should a huge reval happen. But if they revalue they can force the currency to sit within an agreed upon range for a certain length of time (similar to when the Euro was coming to fruition and the member nations still had their own currencies they had to trade within pre-determined ranges with the Euro - long time ago so my recollection may be sketchy). Foreign investors will see the POTENTIAL for Iraq based on the natural resources it has at its disposal - otherwise why would companies like HSBC or Pepsi be in Iraq just now ??? Certainly foreign investors in the oil industry won't be hard to find - there is a wealth of KNOWN oil reserves so no E&P (exploration and production) is required - at least not the "E" part which can be the significant cost - they KNOW the reserves are there so they will spend a LOT of money to be pioneers in Iraq (which is already being seen with Northern Iraq where a company that was a partner of Shell Canada in oil sands oil production just signed a contract).

8. The economy in general would be highly vulnerable and a media report of a terrorist threat or activity could cause a huge panic sell off of dinars to cash in whilst you can. Subsequently crashing the dinar. This is NO different to any other nation worldwide though and should NOT be a significant determining factor in revaluing the dinar. The US will more than likely be MORE susceptible to terrorist activity than Iraq will be (there is the cultural and religious difference which is more than the terror groups have against Iraqis and the nation of Iraq) - so there is a GREATER chance, in my opinion, that the US will be subject to terorist activity than Iraq will be. The terror activity would be greatly reduced anyway if the coalition forces were not IN Iraq. Your point is valid for sure - but I think its significance is only current - once coalition forces leave I believe that the terrorist activity will be vastly diminished. I don't see it as being a significant factor other than short term.


How can you say these points are irrelevant? They ARE relevant Loops, but as you suggested them there are most definitely points of rebuttal and contention - I certainly hope you realise this.

These i believe are highly relevant to our investment and the situation in general.



I look forward to your response.

I hope you enjoyed my response and rebuttal - I love debate and actually thank you for the chance to do so. You are obviously, to me, an intelligent person - and most certainly entitled to your opinion - I just hope that you accept differing viewpoints. It looks to me as though you WANT exactly the same as the rest of us but you have a degree of cynicism that it will be pulled off. Cynicism is healthy and, Loops, you should never lose that as it is the balance that every person should need when making decisions.

Interesting Loops.

While those with a vested interest will 'always' tell you what will go right..

Most of us are adult enough to know what the down side of investing is. Most of us have lost money through the down side of investing.
Most of us are sick to death of looking at the negatives, as we have had it shoved down our throats for over a year or more.

So, no offense, but the need of a caregiver to most of us, is no longer needed. We are all well past the need for a bottle and a pacifier.

What could happen, the Iraqi insurgence could get worse, the fighting could get bloodier, the government could be toppled, Iran could drop a bomb on Iraqi, the CBI could implode, ........see how pointless this all to continue on that line of thought....

Negativity breeds negativity....most of us in this thread don't care to deal with it.

Most of us with a vested interest in the Dinar, have spent hours and hours reading all the information we can and then sharing it with our friends here on this forum. Mike and Adam, have put hours into this forum, to make it informative, and if you were to go back and read some of the earlier information, you will find both the positive and the negative. Right now the positive is over powering the negative.

Posts you are reading have been translated from the original language, I don't know about anyone else, but when someone posts something that 'someone else' heard, I always take that with a grain of salt, because it makes it hearsay. There is a lot of information lost even in the most basic of translations.

Enjoy your life Loops, it is later than you think. If the Dinar Investing is too risky for you, a nice safe money market account might just be the thing.

In the meantime, waiting for this ship to dock is a whole lot easier than other ships which have passed us in the night.

...I couldn't agree with you more Azmia. The lime head kitty is very wise! BTW Loops, you've got me down for a keg of Newcastle now, don't you?

The negative still outwieghs the positive.

You have been mislead by people here or your own interpretation.

That article is infact saying that there will be a zero lop.

The ignorantly positive\dealers have just twisted it so much as so you think it is just a zero lop on the exchange rate because a zero lop does not suit their agenda.

Hugely false.

There are positive stories coming out of iraq yes. However none of them are strong enough at all to justify what you are dreaming for. There are not enough facts that support your dreams either.

There are more negative facts than positive in terms of money supply and reserves etc.

Im still waiting for someone to explain to me how my 8 points of negativity are untrue or impossible?

You claim that you are right yet you cannot disprove me. We cant both be right.

And i dont drink beer so you can all buy me a bottle of JD when im proven correct.