Search found 2 matches for mediaviewer

What it all boils down to

kenlej wrote:

clayf wrote:. It sure didn't happen in Kuwait were their currency stayed internationally the same  https://en.wikipedia.org/wiki/Kuwaiti_dinar #mediaviewer/File:KWD_against_USD.PNG  

We have all heard of the big "Kuwaiti RV" and many arguments have ensued about whether it happened or not with supporters of the myth pointing at the extremely low price of the Kuwaiti Dinar during the occupation, that however is a typical "apples/oranges comparison". What happens is that people are comparing the blackmarket rate of the Kuwaiti Dinar during the occupation to the official exchange rate of the Iraqi Dinar today. That's two ENTIRELY DIFFERENT things! The OFFICIAL exchange rate of the Kuwaiti Dinar never changed one cent during that time and they had to do nothing but change the paper to void stolen currency, the rate was the same before, during and after the occupation! Compare that to Iraq where the currency is OFFICIALLY exchanged and dealt with at the low rate and this is low not because of lost faith such as was the case (illegal blackmarket ONLY!) in Kuwait but rather it's due to inflation from massive over printing. There simply is no comparison what-so-ever to what happened to the Kuwaiti Dinar during the occupation and what's happening to the Iraqi Dinar in Iraq today!


The situation was that Kuwait's official rate, the one that matters, never changed and the blackmaret rate was an illegal unrecognized rate that was entirely dependent on changing political situations and was not controlled by either the Kuwaiti Government or the central bank nor was that rate used in any official trade or exchange. The Government didn't do ANYTHING to increase the exchange rate they simply resumed doing business and reopened the banks without changing the exchange rate by one cent, the blackmarket trade in Kuwaiti Dinar then simply disappeared so there never EVER was a Kuwaiti "RV", the Kuwaitis NEVER EVER "RVed" anything at any time!


In Iraq's case the official rate and the street rate are nearly the same and in order for the rate to increase would require that Iraq take drastic measures, unlike Kuwait who had to do nothing. Iraq could, theoretically anyway, allow the rate to gradually rise but from where it is now to an amount that would even cover the spreads speculators paid to dealers would take DECADES and that is only IF they can get their act together and quit blowing up each other, good luck with that! 


Why would it take decades for the Dinar to increase any significant amount? That's a good subject for another discussion but basically it could only increase as reserves rise (no they can not "suck in" Dinar through the auctions as is often touted, that's not the way things work) and the CBI would NEVER allow it to rise at any steady rate that would attract speculation, that would be economic suicide even if the reserves grew fast enough to support such an event.

What it all boils down to

clayf wrote:Yes I too would think the same thing. How to pay out such a large number. I think it was'nt suposed to play out as it has.It went on(the dinar purchases for to long)I had my first purchase in early 2009 and maybe then it may have worked but now,six years + later. Well here we sit. I think! it was called the Marshall plan (correct me if I'm wrong,anybody)But thats a good one to look up and read.basically it talks of bombing a place into submission.The currency collapses to next to nothing,you grab on to a bunch of that currency, rebuild the country, get it back on its feet, the currency that you got for nothing now climbs to a new high and booyah your rich.So far NOT us 

Tell me one country that has happened too without a Redomination where u turn in your hyperinflated currency at a value of 1 to 1 so nobody gets rich. It sure didn't happen in Kuwait were their currency stayed internationally the same  https://en.wikipedia.org/wiki/Kuwaiti_dinar #mediaviewer/File:KWD_against_USD.PNG