University of Mesopotamia discuss the project to delete the zeros

Brought over from The Currency News Hound


Business Economics at the University of Mesopotamia discuss the project to delete the zeros
Wednesday, January 11 2 / January 2012

BAGHDAD / With: Faculty discussed the economics of the business at
the University of rivers, the restructuring of the Iraqi currency (the
project to delete the zeros) within the scientific activities of the
first semester.

The ministry said in a statement issued Wednesday, the Agency has
received reports of the future, a copy of “The Director of Information
University Mohammed Jassim said the Faculty of Business Economics
discussed the project to delete the zeros in the scientific lecture to
the Deputy Governor of the Central Bank of the appearance of Dr.
Mohammed Saleh titled (the restructuring of the Iraqi currency project
to delete the zeros three), hosted by Hall of Mesopotamian civilization
in the Faculty of Political Science. “

He said the lecture was organized by the Faculty of Business
Economics dealt with ways of activating the Iraqi economy by spreading
awareness among the public to accept the idea of deleting zeros from the
currency, which make the economy stable, as well as lack of fear of the
currency exchange, or drop the cost to the contractual obligation or
guarantees through legislation, law for this purpose needs to be
aggressively contracting parties rights and obligations placed on it.

http://thecurrencynewshound.com/2012/01/11/mesopotamia-university-business-department-discusses-upcoming-deletion-of-zeros-on-iraq-currency/

Looks an sounds like 86 cents to me! AJ

I'd be happy with 10 cents, just please lord, NO LOP!

I have maintained all along that a post LOP rv rate of $4 plus would still payoff better than most any other investment that we have ever had. Maybe not the millions that we had dreamed of, but a great return, none the less.

Please explain how a LOP benefits Iraq with lower denomination bills in circulation and how this does not worsen their current currency problem literally by a factor of 1000.

landcareunlimited wrote:Please explain how a LOP benefits Iraq with lower denomination bills in circulation and how this does not worsen their current currency problem literally by a factor of 1000.

Quite simple, actually.
The are having new currency printed to replace the current currency and the new currency will be in lower denominations where the current 25K will be equal in value to the new 25 note, 10K = 10 note, 5K = 5 note, 1K = 1 note, 500 = .50 coin, 50 = .05 coin...
This is intended to create more stability for the currency and the economy. It is also designed so that people will begin using dinar for commerce rather than USD.
Initially, the intention is to value the new dinar at either .86 or at an even $1.00. So when a person buys that loaf of bread for $3.00 today, or 3000 dinar, that same loaf of bread will be purchase with 3 dinar in the new currency.
Bookkeeping will be supposedly easier to maintain due to less zeros to deal with. And supposedly the inflation will be more under control with the new currency.
So, as the new currency revalues up or down (hopefully up), the old currency will increase or decrease the same rate divided by 1000. In simple terms, if the new currency increases to $1.25, the old/current currency will increase to .00125

The question in my mind seems to be, how is Iraq going to limit the money supply once it RVs.
I read this the other day and it seems to make since.
http://dinardaily.forumotion.com/t15975-interesting-post-on-dd-regarding-commentary-on-the-dinar#102972
My take away from the commentary is, China would be able to lower it's reserves of inflated U.S. dollars and replace them with Iraqi Dinar. So the Dinar would be in China's reserves and not on the streets of Iraq.

Greenlight-I appreciate the time you took for your response, but I am not certain my question was understood. I understand and agree with everything you contend, but my (sarcastic) statement was in response to discussion regarding a straight LOP. Specifically defined, a LOP means they are just hacking off the zeros from the currency and NOT adjusting the exchange rate. We do not want a LOP...we want an exchange rate adjustment, or an RI or RV.

If they just lopped the zeros, it would take 1000 times more bills to consummate the same transactions. This would mean instead of wheelbarrows full of cash, it would take dump trucks full of cash. The new (lower) denoms and coins are utterly useless without an exchange rate because they become unusable. This fact is one of our primary insurances that they intend to RI/RV their currency.

Again, I think every word of what you wrote is accurate, but I was addressing the following posts:

Bcolorad: I'd be happy with 10 cents, just please lord, NO LOP!

Bigdaddytim: I have maintained all along that a post LOP rv rate of $4 plus would still payoff better than most any other investment that we have ever had. Maybe not the millions that we had dreamed of, but a great return, none the less.

with my comment: Please explain how a LOP benefits Iraq with lower denomination bills in circulation and how this does not worsen their current currency problem literally by a factor of 1000.

We are in total agreement...I am just weary of the LOP discussion. It is mutually exclusive of and RI/RV and simply will not happen.

Landcareunlimited... Ah, I see... thanks for the clarification. And you are right. If they simply LOP'd, their economy would fall off a cliff.

Bcolorad wrote:The question in my mind seems to be, how is Iraq going to limit the money supply once it RVs.
I read this the other day and it seems to make since.
http://dinardaily.forumotion.com/t15975-interesting-post-on-dd-regarding-commentary-on-the-dinar#102972
My take away from the commentary is, China would be able to lower it's reserves of inflated U.S. dollars and replace them with Iraqi Dinar. So the Dinar would be in China's reserves and not on the streets of Iraq.

I seriously doubt China will change anything concerning their holdings. They will, as will all other countries, continue to do commerce in USD - especially with the U.S. and with Iraq.
Iraq plans to sell oil in USD and not IQD.

Also, in response to your first statement...
Iraq will be able to better control their money supply. The new currency is said to be counterfeit-proof while the current currency is not.
So, once they demonetize the current currency they will only have 30 billion IQD instead of the current 30 trillion. Also, they have stated that they plan to back up their currency in gold making it much more difficult to simply print more money (unlike the UST).

landcareunlimited wrote:Please explain how a LOP benefits Iraq with lower denomination bills in circulation and how this does not worsen their current currency problem literally by a factor of 1000.

While none of us here want the LOP scenario to happen, it could.

Let's say for the sake of argument that there is only one trillion dinar in circulation.
With a LOP the Central Bank issues a new currency with lower denominations.
A 25k old note, and a 25 dinar new note have the same value. The Central Bank would have a set period of time where both currencies coexist. Once that period expires the old notes are worthless. If all notes in existence were traded in for the new notes there would now be 1 billion dinar out there. There would still be the same number of notes(and or coins) but the number of dinar would be 1000 times less.
So what an Iraqi use to pay 25,000 for would cost him 25 dinar. This scenario only changes the value of the new notes not the old ones that we hold.

greenlight wrote:

landcareunlimited wrote:Please explain how a LOP benefits Iraq with lower denomination bills in circulation and how this does not worsen their current currency problem literally by a factor of 1000.

Quite simple, actually.
The are having new currency printed to replace the current currency and the new currency will be in lower denominations where the current 25K will be equal in value to the new 25 note, 10K = 10 note, 5K = 5 note, 1K = 1 note, 500 = .50 coin, 50 = .05 coin...
This is intended to create more stability for the currency and the economy. It is also designed so that people will begin using dinar for commerce rather than USD.
Initially, the intention is to value the new dinar at either .86 or at an even $1.00. So when a person buys that loaf of bread for $3.00 today, or 3000 dinar, that same loaf of bread will be purchase with 3 dinar in the new currency.
Bookkeeping will be supposedly easier to maintain due to less zeros to deal with. And supposedly the inflation will be more under control with the new currency.
So, as the new currency revalues up or down (hopefully up), the old currency will increase or decrease the same rate divided by 1000. In simple terms, if the new currency increases to $1.25, the old/current currency will increase to .00125

I think this is a very possible scenario that many people say has been debunked. It does everything the articles from Iraq have said they want to do with the delete the 3 zeros project. I hope it doesn't go this way but I have seen no proof or plausible explanation as to why it couldn't happen even though I have asked several times. If this ever comes out in clear language as being Iraq's plan the dinar sales will completely dry up... the pumpers worst nightmare

greenlight wrote:Also, in response to your first statement...
Iraq will be able to better control their money supply. The new currency is said to be counterfeit-proof while the current currency is not.

In your dreams maybe. If a man can figure out how to do it, someone else will figure out how to fake it. It might be harder, but it will still be done, and good enough to fool the average person.

Kevind53 wrote:

greenlight wrote:Also, in response to your first statement...
Iraq will be able to better control their money supply. The new currency is said to be counterfeit-proof while the current currency is not.

In your dreams maybe. If a man can figure out how to do it, someone else will figure out how to fake it. It might be harder, but it will still be done, and good enough to fool the average person.

Yep, you are so right. But that's their hope and what they have to say. It would be a disaster for them to say otherwise.