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Trials For Dinar Holders - Marcus Curtis

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Trials For Dinar Holders - Marcus Curtis Empty Trials For Dinar Holders - Marcus Curtis

Post by RamblerNash on Wed Aug 05, 2015 12:12 am

Trials For Dinar Holders


Marcus Curtis
August 4, 2014

People have not always agreed with my analysis and that is OK. Everyone is entitled to their own opinion. There have been several things that I have been saying over the last 2 years that cause many dinar investors to doubt my opinion. But I would like to rehash a few points and put those points in a present day scenario.

I have always said that there is more currency outside of Iraq’s borders then in its borders. Iraq only has about 5 trillion dinar inside the country today. That would mean that there is a lot of excess currency presently outside the border of Iraq today. I calculated a figure of 25 trillion. I was using the difference in the currency supply going back to 2005/2006. This was a very conservative number and I gave a conservative number on purpose. In my mind I knew there was more but I would proclaim that there is at least 25 trillion dinar outside of Iraq in my posts/articles. People thought I was crazy.

The other part of the Puzzle is simply this. When dinar leaves the country it is exchanged for U.S. Dollars. This action brings U.S. dollars into Iraq as the dinar leaves. So using very rough numbers 25 trillion dinar is about 25 billion U.S. dollars. That money goes into the central bank’s reserves and it is used to back the dinar. So as the reserves grow the dinar currency supply also grows. The more dinar Iraq exports the more dollars come in and this means more dinar goes into circulation to cover the gap that the exported dinar made. This has become a vicious circle and no Guru has been able to explain it.

Yet another part of this puzzle is Iraq’s currency laws. I have pointed out several times that in section 32 of Iraq’s currency laws it is illegal to export their currency outside of Iraq and that the dinar can only be used within Iraq itself. Now this is a law they do not enforce because to do so would stop the flow of U.S. dollars into Iraq’s reserve supply!

The last part of the puzzle is the redenomination that Iraq may do one day. If it happens then Iraq will not honor the currency (25 trillion) that is outside of its borders. They will only honor the money within its borders. Iraq will cite its currency laws as the reason for doing this. They will say they have every right to do this.There are no international treaties with Iraq that protects investors should the dinar redenominate. I presented links with facts throughout this site. Basically this means that Iraq will be able to keep every U.S. dollar it imported into its reserves and the central bank has a large amount of imported U.S. dollars.

I have been saying this for the last 2 years. I have said that this scam goes all the way to the top. Now I am going to sound really crazy. I would ask that you read this entire post to the end and click on the links for they will be very important in my conclusions.

I believe the Iraqi government knew all along (ever since 2004) that they were scamming the poorest of American people out of their hard earned money with the false promise of wealth. I think the highest level of government in Iraq and the central bank had this planned all along! I think they are the ones who actually set this whole thing up to begin with! I even suspect that they had help from the Coalition Provisional Authority or CPA! This is just my opinion but in my view this is the only thing that makes sense to me given Iraq’s history. These guys at the very top and at the planing stages of the new Iraqi government set this up! This explains why America has done nothing to stop this scam! Now let me show you something. Read this article from Forbes

The Dinar’s Dismal Future: Sell Now

http://www.forbes.com/sites/johnwasik/2014/07/28/the-dinars-dismal-future-sell-now/

Let me provide just two quotes


“Iraq is basically enmeshed in a brutal civil war without any cohesive social fabric to pull it back together. Except for some military advisers, the U.S. and Western powers are staying out of the country”.
“Although no regulator knows how many investors hold the dinar, Prof. Bunting estimates “that there are around 40 trillion Dinar in circulation and only about 5 trillion actually reside in Iraq so the rest is held by dinar speculators around the world”.

This means that there is much more than 25 trillion dinar outside of the borders of Iraq. According to this article there is now about 35 trillion dinar that is now outside Iraq’s border. That also means that this added well over 35 billion to Iraqi Central Bank’s reserves and this money came from people all over the world. I am willing to bet that some of the poorest of Americans sent Iraq Billions when they collectively purchased dinar from dealers.

My numbers were conservative because I did not want to overstate my case. I wanted to be as factual as I could without exaggerating numbers. But now it seems that something more serious is on the horizon. As stated by the article above, Iraq is dealing with civil war and Iraq has another serious problem too!

Syria Iraq: The Islamic State militant group

“Under its former name Islamic State in Iraq and the Levant (Isis), it was formed in April 2013, growing out of al-Qaeda in Iraq (AQI).”
“Its precise size is unclear but it is thought to include thousands of fighters, including many foreign jihadists.”
“The US said the fall of Iraq’s second city posed a threat to the entire region. It may also have made ISIS the most cash-rich militant group in the world”
“Initially, the group relied on donations from wealthy individuals in Gulf Arab states, particularly Kuwait and Saudi Arabia, who supported its fight against President Bashar al-Assad.
Today, IS is said to earn significant amounts from the oil fields it controls in eastern Syria, reportedly selling some of the supply back to the Syrian government. It is also believed to have been selling looted antiquities from historical sites.”

http://www.bbc.com/news/world-middle-east-24179084

(Picture removed for graphical content)

Remember I said earlier if Iraq redenominates? I think the current Iraqi government has planned to redenominate all along. But if the government falls then what happens to the currency? What happens if Iraq is torn apart by civil war? Here is a worst case scenario.

What happens if ISIS over takes the CBI and Gains access to their reserves? What kind of weapons could they fund with the 35 billion that everyone around the world sent Iraq because they were deceived into believing that they were going to be rich if they bought dinar?

These are interesting questions. What happens to the dinar if the government falls or if it gets divided up into sections? it may very well be that the Kurds have one region of the country and the rest is divided among Islamic factions. However if Iraq gets divided up the real question is who gets the reserves that are left over in the central bank when the current government collapses? If ISIS does gain control of the central bank it will have new found wealth to fund its war machine.

There is one last component to all of this. The dinar is exported and sold around the world even though Iraq says it is illegal to do this. Third world nations and the poorest of people have been robbed by Iraq! There are people in these countries that make so little that a major investor in this country may only be able to get one 25,000 note. Some may have One 10,000 note or even one 1,000 note.

This means that there are millions of people around the world that purchased dinar.When this thing collapses (and it will collapse) poor people who invested in the dinar around the world will be devastated. So while this country proceeds with their quest of ripping off the poorest of people around the world there are major uprisings within the nation of Iraq! This creates several scenarios that could play out.

Iraq could redenominate and make all of the currency outside of its borders null and void. Iraq could fall and the government could be divided in approximately three different ways. ISIS could gain complete control over the region and raid the reserves. I highly doubt that ISIS will have any regard for dinar investors around the world. It amazes me that people still choose to believe in this scam in light of all the evidence. The Middle East is becoming more and more dangerous. This is not a good place to invest your money!

https://iraqcurrencywatch.wordpress.com/2014/08/04/trials-for-dinar-holders/
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Post by Ssmith on Wed Aug 05, 2015 9:52 am

"Yet another part of this puzzle is Iraq’s currency laws. I have pointed out several times that in section 32 of Iraq’s currency laws it is illegal to export their currency outside of Iraq and that the dinar can only be used within Iraq itself. Now this is a law they do not enforce because to do so would stop the flow of U.S. dollars into Iraq’s reserve supply!"

Just imagine that if Iraq was to RV, do you really think they is a snowballs chance in hell that they would allow all the IQD outside of the country to be exchanged?



What is the supposed new rate?  $3.??  That would cost Iraq trillions of dollars.

Iraq has been getting USD from Dinar sales, dealers have been making an outrageous profit selling it and Tony has been pumping the crap out of it, getting stinking rich.  Where does that leave the Dinar holders outside of Iraq?  Stuck with a bunch of worthless toilet paper that no bank will exchange, because Iraq will only exchange for the new currency in country and everyone outside of Iraq will be SOL.
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Post by FS4Enthusiast on Wed Aug 05, 2015 10:51 am

@ssmith wrote:Just imagine that if Iraq was to RV, do you really think they is a snowballs chance in hell that they would allow all the IQD outside of the country to be exchanged?

If the CBI announced tomorrow (if, for example, the CBI got taken over by a Saddam type that wanted to exchange his personal 25,000 dinar bills for 25,000+ USD in order to take Iraqs reserves and put them in his own pocket) that they had RVd the dinar to 3 dollars (or 1 dollar, or 10 cents, etc) there isn't a single bank on the planet that would honor that exchange rate (including the banks in Iraq). They all know that Iraq doesn't have the reserves to make good on that rate.

Dinarians would be losing their minds trying to figure out why BoA or WF refuse to give them 75,000 dollars for their 21 dollar dinar note.

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Post by Ponee on Wed Aug 05, 2015 11:52 am

Ssmtih wrote:Just imagine that if Iraq was to RV, do you really think they is a snowballs chance in hell that they would allow all the IQD outside of the country to be exchanged?

That is a discussion I have with my husband and brother in law all the time.  I have said that even if there is an RV, it doesn't mean that ANYONE outside of Iraq will be able to Exchange. 

They could RV, and allow citizens to exchange at BANKS within Iraq giving them NEWLY CREATED DINARS at a the new rate.  Call me crazy, or wrong, but I can just see it happening that way or in a similiar way.

For that reason, we opened a Warka account.  Alas, we are still unable to withdraw any of our deposits. And, we don't know if we will ever be able to.

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Post by Ponee on Wed Aug 05, 2015 11:58 am

By the way, Good post RAMBLER ! Thank you !

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Post by Kevind53 on Wed Aug 05, 2015 9:32 pm

Good article, although I do not agree with everything stated. It may be not what we want to hear, but still .... I do have one thing that is just not sitting right however, according to the CBI they have sufficient reserves to cover all dinar in circulation. That does no seem to jibe with this statement:
So as the reserves grow the dinar currency supply also grows. The more dinar Iraq exports the more dollars come in and this means more dinar goes into circulation to cover the gap that the exported dinar made. This has become a vicious circle and no Guru has been able to explain it.

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Post by FS4Enthusiast on Thu Aug 06, 2015 3:36 pm

@Kevind53 wrote:Good article, although I do not agree with everything stated. It may be not what we want to hear, but still .... I do have one thing that is just not sitting right however, according to the CBI they have sufficient reserves to cover all dinar in circulation. That does no seem to jibe with this statement:
So as the reserves grow the dinar currency supply also grows. The more dinar Iraq exports the more dollars come in and this means more dinar goes into circulation to cover the gap that the exported dinar made. This has become a vicious circle and no Guru has been able to explain it.

I think it still jibes. The CBI takes in 860 bucks, they send out a million dinar, the ratio of dinar/reserves remains the same. Unless I'm missing something.

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Post by Muskie on Thu Aug 06, 2015 3:53 pm

Why are we speculating?  I thought it was clearly written in the IMF docs that the dinar will gradually rise?  Nowhere have I seen any indication that Iraq plans to redenominate the dinar.  Sorry, don't buy it,  it is not in the cards.  If it was, it could and would have already happened years ago.  I do agree the CBI in a sense, got,  an "interest free" loan selling dinar for dollars to build the reserves, but the rest of Marcus' diatribe is utter garbage.
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Post by FS4Enthusiast on Thu Aug 06, 2015 3:59 pm

@muskie wrote:I thought it was clearly written in the IMF docs that the dinar will gradually rise?

I've never seen that. I've seen them talking about exchange rates, almost certainly meaning getting the street rate (anywhere from 1200 to 1350) back to 1166.

Nowhere have I seen any indication that Iraq plans to redenominate the dinar.

You haven't seen the literally thousands of articles talking about deleting three zeros? Yeah, they haven't done it. This is Iraq. It takes them three years to get parliament to vote on changing someones name tag. They're slow.

If it was, it could and would have already happened years ago.

This is a common statement on the various dinar forums, but it just doesn't hold water. Yeah, they've been talking about lopping for a long time and haven't done it. Know what else they've been talking about for a long time? The HCL. Haven't done that either. They don't do anything promptly. They're poor, the government is mostly corrupt and effed up, and they live in a violent third world craphole. You expect them to be efficient?

but the rest of Marcus' diatribe us utter garbage.

No, it isn't.

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Post by dwm007 on Thu Aug 06, 2015 4:54 pm

@muskie wrote:Why are we speculating?  I thought it was clearly written in the IMF docs that the dinar will gradually rise?  Nowhere have I seen any indication that Iraq plans to redenominate the dinar.  Sorry, don't buy it,  it is not in the cards.  If it was, it could and would have already happened years ago.  I do agree the CBI in a sense, got,  an "interest free" loan selling dinar for dollars to build the reserves, but the rest of Marcus' diatribe is utter garbage.

It is???? Where? I bet you can't find that anywhere except in pumper "info"! Nowhere have you seen that Iraq plans to re-denominate the Dinar? Are you kidding???? They have been telling people for over 5 years now that they plan to do so and have even described it in detail, many times referring to Turkey as an example of what they intend to do! Deleting the zeros is re-denomination (LOP) and don't let the lying gurus tell you any different, it's just plain common sense that ANY time Iraq mentions raising the exchange rate they are talking about the market, or street, rate because they would NEVER EVER tell anyone about any plan to increase the official exchange rate! They would never do such a thing because it would be economic suicide to tell speculators ahead of time about even a tiny increase in the official exchange rate. As far as why they haven't done it yet is no mystery at all, like a lot (most) of the proposals in Iraq there are some lawmakers for it and some opposed' Since it is an expensive endeavor (printing ALL new currency, etc) and at a real risk for fraud there are legitimate arguments against it especially when any gain from doing it will be for little more convenience. The downsides are mostly expense and the possibility of fraud and it's only real upside is better acceptance (a very important upside however) and not everyone there is convinced it's worth it so like many proposals in Iraq the dispute goes on. 

What gets me more than anything else about this is how so many people think "deleting the zeros" means a huge increase in value that's going to make them rich when nothing could be farther from the truth!

It's really pathetic watching these people who have been brainwashed by the gurus get excited at the deleting the zeros articles as if it's what they have been waiting for!


It's like watching the condemned cheering on the executioner!

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Post by Ssmith on Thu Aug 06, 2015 5:00 pm

Deleting the zeros is like a reverse stock split.  Or at least for me, that's the easiest way to understand it.


10 shares of stock that are worth $1 each = $10

After the split you'll have:


1 share of stock that is worth $10 = $10

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Post by Ponee on Thu Aug 06, 2015 5:03 pm

@muskie wrote:Why are we speculating?  I thought it was clearly written in the IMF docs that the dinar will gradually rise?  Nowhere have I seen any indication that Iraq plans to redenominate the dinar.  Sorry, don't buy it,  it is not in the cards.  If it was, it could and would have already happened years ago.  I do agree the CBI in a sense, got,  an "interest free" loan selling dinar for dollars to build the reserves, but the rest of Marcus' diatribe is utter garbage.


Speculating is BIG MONEY for the GURUS!  I think we should all stop following and just let it do what it will do and shut down all dinar sites.

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Post by dwm007 on Thu Aug 06, 2015 5:24 pm

I accidentally posted my last reply while I was right in the middle of making a change in it so two points, the re-denomination and exchange rate increases got run together making very little sense, sorry about that.

What I was intending to point out was that any time they talk about attempting to increase the exchange rate it's always about the street rate for the reasons already given but of course a re-denomination also results in an increase in the exchange rate but in a different way. An across the board increase in the rate, such as the one a couple of years ago from 1170 to 1166, actually does mean an increase in value of the Dinar being held by speculators/investors and THAT is the type of rate increase they would NEVER announce ahead of time for obvious reasons. The exchange rate increase in the event of a re-denomination has been referred to several times by the Iraqis and this one is where folks get confused by the three zero articles. In that case the rate does indeed increase substantially but ONLY FOR THE NEW CURRENCY, the old currency still exchanges for the same rate as it does now and exchanges for the new currency at a rate equal to the same value. In this case the new currency would increase by 1000 times (removing three zeros) but the old currency would be exchanged for the new at the same rate of 1000 old for 1 new meaning it's a zero profit event which is exactly how all re-denominations work!

The Iraqis have explained this many times in many articles in the past but somehow these seem to have either been forgotten or as is more often the case twisted around to mean something entirely different from their original intent. Re-denomination of any currency is to erase the effects of PAST inflation and does not nor can not increase wealth! This is a common method of erasing negative effects of past inflation and has been done by numerous countries, some more than once, and it's important to note that it's done AFTER inflation has been brought under control. It's only a tool to repair the damage of of high inflation after the underlying cause has been brought under control and it is NOT, nor can it be, used as a way to increase a country's wealth!

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Post by Ponee on Thu Aug 06, 2015 5:32 pm

This is a very interesting thread!  I love the sharing of thoughts on here.  Thank you so much for participating and sharing your view points.

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Post by RamblerNash on Fri Aug 07, 2015 7:18 am

@Ponee wrote:By the way, Good post RAMBLER ! Thank you !

:winky winky:
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Post by kenlej on Mon Aug 10, 2015 2:35 pm

U should read the comments under this post too. I've known Curtis Marcus for 2yrs now through emails and commenting on Baghdad Invest and he is a very smart guy. He fell for the RV scam in 2010 and believed it until he started researching it himself. If u read the articles in his blog u can't help but come away with the knowledge you've been scammed https://iraqcurrencywatch.wordpress.com/ . As u can see in this graph http://www.tradingeconomics.com/iraq/money-supply-m2  the M2 of the CBI rose 3.7 trillion dinar since Oct of 2014 to 91704 billion dinar.

Money Supply M2 in Iraq increased to 91704 IQD Billion in December from 88007 IQD Billion in November of 2014. Money Supply M2 in Iraq averaged 44296.55 IQD Billion from 2003 until 2014, reaching an all time high of 91704 IQD Billion in December of 2014 and a record low of 6953 IQD Billion in December of 2003. Money Supply M2 in Iraq is reported by the Central Bank of Iraq. Even at a $1 that would be 7 times more USD than is now, talk about inflation LMAO There's only about 12 trillion USD http://www.tradingeconomics.com/united-states/money-supply-m2 so where is all the USD going 2 come from? These figures comes from http://www.tradingeconomics.com/iraq/indicators a much used indicator of a countries economy. 

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Post by Muskie on Mon Aug 10, 2015 2:49 pm

From IMF Article IV Consultation;


“14. The de facto fixed exchange rate has served Iraq well. The authorities agreed that a stable nominal exchange rate provides a valuable anchor for inflation expectations in an uncertain environment, and intend to continue implementing this policy for the foreseeable future. In the medium term, staff encouraged the authorities to consider creating the conditions which would make possible a move to a more flexible exchange rate policy. Such flexibility could allow a predictable and gradual appreciation of the nominal exchange rate, triggered by strong oil revenues and the Balassa-Samuelson effect, to accommodate a possible real exchange rate appreciation while keeping domestic inflation low.”



http://www.imf.org/external/pubs/ft/scr/2013/cr13217.pdf


Definition of 'nominal exchange rate' is simply the price of one currency in terms of the number of units of some other currency. This is determined by fiat in a fixed rate regime and by demand and supply for the two currencies in the foreign exchange rate market in a floating rate regime.

http://articles.economictimes.indiatimes.com/2003-01-28/news/27532328_1_real-exchange-reer-nominal-effective-exchange-rate



Seems real clear this will take time and will rise gradually.  Appreciating the value of a currency the correct way is no secret.  Sound economic growth, influx of investment, and GDP raise the value, not a RV or secret formula.  For the IMF to disclose the concept is nothing more than telling the world, the dinar will rise, but only by sound monetary policy.  Maybe Curtis needs to get educated.
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Post by dwm007 on Mon Aug 10, 2015 4:17 pm

Maybe someone else needs to get educated by looking at how currencies have historically risen. When they are talking about a gradual rise they are not talking about large increases, very small increases over time at a rate that will NOT attract speculators for obvious reasons! No way is Iraq going to start a "predictable" substantial increase in these rates otherwise they would not only be inviting inflation but would be inundated with speculators using this "predictable" rise for profit, they aren't that stupid!  Besides, for the same reason they can't (that's CAN'T, not won't!) RV by any significant amount they will not (can not!) increase to any rate that exceeds their reserves, currently they state they have enough reserves to cover 1 1/2 times their currency but even if they did that it would not rise enough to cover the dealers' spreads never mind making anyone rich.

What is so hard for people to understand? Iraq has around +/- $70 billion worth of reserves to cover their currency and they can not exceed that without incurring drastic inflation! At a rate of $1 per Dinar that $70 billion dollars will not cover even one tenth of one trillion never mind the 80 trillion or so Dinar they have and THAT'S why the Dinar is less than a tenth of a cent and can not rise by any significant amount. Look at the numbers, just Sterling alone, according to the FBI files, did $600 million gross sales so that's well half a trillion Dinar just that one dealer sold! 600 billion Dinar (600 million dollars worth from that one dealer) is about 10 times Iraq's total reserves and that is if they paid out every cent of it to speculators and kept nothing for themselves! But of course they can't pay out even ten times more than they have!

The bottom line is that in order to "RV" to $1 per Dinar would require around 90 TRILLION dollars which just happens to be several times more money than collectively exists on planet Earth! As was asked above just where in the hell are all those dollars supposed to come from?

OK maybe you say "yeah but they don't have to cover their total liabilities (actually they would)  and only have to cover actual physical cash in circulation so in that case they "only" need about 30 TRILLION dollars to cover it or about twice the number of dollars in the U.S. money supply!

The Iraqi Dinar currently exchanges for about what it's worth, the money supply divided by the reserves works out to around 1000 to 1 (sound familiar?) and whether or not it rises by some overnight "RV" or a gradual rise over time it can NOT rise above what they have on hand to back it with which is currently less than $100 billion dollars, which just happens to be only a fraction of what it would take to cover just what speculators in the U.S. hold at a rate of1$ even if they gave away every cent in the effort! Heck, that wouldn't even cover what Sterling alone has sold at a rate of $1!

The numbers simply don't add up, not even remotely close, but the gurus and dealers count on people not adding it up. apparently a strategy that has worked quite well!


Last edited by dwm007 on Mon Aug 10, 2015 4:42 pm; edited 1 time in total

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Post by kenlej on Mon Aug 10, 2015 6:32 pm

@dwm007 wrote:Maybe someone else needs to get educated by looking at how currencies have historically risen. When they are talking about a gradual rise they are not talking about large increases, very small increases over time at a rate that will NOT attract speculators for obvious reasons! No way is Iraq going to start a "predictable" substantial increase in these rates otherwise they would not only be inviting inflation but would be inundated with speculators using this "predictable" rise for profit, they aren't that stupid!  Besides, for the same reason they can't (that's CAN'T, not won't!) RV by any significant amount they will not (can not!) increase to any rate that exceeds their reserves, currently they state they have enough reserves to cover 1 1/2 times their currency but even if they did that it would not rise enough to cover the dealers' spreads never mind making anyone rich.

What is so hard for people to understand? Iraq has around +/- $70 billion worth of reserves to cover their currency and they can not exceed that without incurring drastic inflation! At a rate of $1 per Dinar that $70 billion dollars will not cover even one tenth of one trillion never mind the 80 trillion or so Dinar they have and THAT'S why the Dinar is less than a tenth of a cent and can not rise by any significant amount. Look at the numbers, just Sterling alone, according to the FBI files, did $600 million gross sales so that's well half a trillion Dinar just that one dealer sold! 600 billion Dinar (600 million dollars worth from that one dealer) is about 10 times Iraq's total reserves and that is if they paid out every cent of it to speculators and kept nothing for themselves! But of course they can't pay out even ten times more than they have!

The bottom line is that in order to "RV" to $1 per Dinar would require around 90 TRILLION dollars which just happens to be several times more money than collectively exists on planet Earth! As was asked above just where in the hell are all those dollars supposed to come from?

OK maybe you say "yeah but they don't have to cover their total liabilities (actually they would)  and only have to cover actual physical cash in circulation so in that case they "only" need about 30 TRILLION dollars to cover it or about twice the number of dollars in the U.S. money supply!

The Iraqi Dinar currently exchanges for about what it's worth, the money supply divided by the reserves works out to around 1000 to 1 (sound familiar?) and whether or not it rises by some overnight "RV" or a gradual rise over time it can NOT rise above what they have on hand to back it with which is currently less than $100 billion dollars, which just happens to be only a fraction of what it would take to cover just what speculators in the U.S. hold at a rate of1$ even if they gave away every cent in the effort! Heck, that wouldn't even cover what Sterling alone has sold at a rate of $1!

The numbers simply don't add up, not even remotely close, but the gurus and dealers count on people not adding it up. apparently a strategy that has worked quite well!
Good read!! A fact that is never mentioned is that revaluing a countries currency is bad for their economy especially a country who's GDP is beholden on exports because it makes the exports more expensive!! China had to have it's arm twisted to revalue their Yuan 10% because it made their products 10% more expensive in the USA so Iraq,Vietnam,Zimbabwe,Indonesia,Afghanistan& anymore if I missed 1 LMAO would commit economic suicide by raising their currency. Does that make sense to all the GCR believers???
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Post by Muskie on Mon Aug 10, 2015 8:02 pm

Raising the value gradually does invite nor create inflation, it reduces it.  Inflation is caused by excess aggregate demand (economic growth too fast) or supply side factors that causes an increase in the price level.  The counter for such is to raise the value.  You cannot create your own rules.  With Iraq poised to be the next economic wild west, raising the value over time is a real significant possibility. Currency speculation is what the financial markets do every single day, it's call Forex.  Might want to look into it.

I agree that no RV can happen for the reasons you state, but a gradual appreciation also reduces the money supply during the transitional phase.
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Post by dwm007 on Mon Aug 10, 2015 8:11 pm

Another one is that it seems everyone just takes for granted that the Dinar will increase in value as their economy grows (if that ever happens) but will it? Owning the currency of a country is NOT like owning stock in a company! We hear it all the time, "Iraq MUST increase the rate to attract investment, etc" but do they really? Take South Korea for example, their economy absolutely DWARFS that of Iraq and they have a huge well developed infrastructure, a huge very modern manufacturing base and Billions of dollars in foreign investors but guess what? Their exchange rate as of today is .00086 to the Dollar compared to Iraq's Dinar at .00087 to the Dollar, almost exactly the same rate! South Korea is a very stable and booming economy and they have had that exchange rate for years and seem to have no interest at all in increasing it! So just like a lot of other nonsense the pooroos have people believing Iraq in no way HAS to increase their exchange rate and just like South Korea they may very well decide to leave it just as it is.

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Post by Muskie on Mon Aug 10, 2015 8:20 pm

Your argument is just referencing guru folklore, not monetary policy. The dinar will rise in value not because it has to, or some guru story of a mythical RV, but because it will be used as a monetary tool to improve the economic conditions within Iraq.  An example comes from Iraq itself back in 2004 when Dr. Shabibi floated the dinar over a 6 month period to raise the dinar from 3200 to $1 to about 1200 to $1.  Subsequent increases came afterward once the dinar was changed back to the peg.  A similar event is a very real possibility when the conditions warrant.
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Post by dwm007 on Mon Aug 10, 2015 8:28 pm

@muskie wrote:Raising the value gradually does invite nor create inflation, it reduces it.  Inflation is caused by excess aggregate demand (economic growth too fast) or supply side factors that causes an increase in the price level.  The counter for such is to raise the value.  You cannot create your own rules.  With Iraq poised to be the next economic wild west, raising the value over time is a real significant possibility. Currency speculation is what the financial markets do every single day, it's call Forex.  Might want to look into it.

I agree that no RV can happen for the reasons you state, but a gradual appreciation also reduces the money supply during the transitional phase.

I said gradually raising the rate to a worth exceeding their reserves creates inflation, I didn't say gradually rising rates caused inflation. For anyone to profit like they are hoping for would require the exchange rate to rise to a point that would far outstrip Iraq's meager reserves just as would a huge overnight RV so neither is a practical option -THAT was my point! Also for such a rise to be profitable within any reasonable time frame, ten years or so, would require a rise FAR in excess of anything that has ever occurred in history, it would take 50% or more just to cover the dealer spreads and offset inflation!  A gradual appreciation by necessity would be much too small to be profitable, by necessity because no central bank is going to allow a predictable appreciation to continue that would attract speculators, that would be counter productive and to put it bluntly just plain stupid.

With the introduction of the "bremmer" after the war there was a short time to have made a profitable investment in Iraq's currency but even that was not something that would have made anyone rich unless they had of invested very large amounts, if they had of done so they could have doubled the investment in a couple of years but at the time it was a very high risk since it could just as easily have gone the other way so few if any took advantage of it on any sizable scale.

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Post by dwm007 on Mon Aug 10, 2015 8:45 pm

@muskie wrote: An example comes from Iraq itself back in 2004 when Dr. Shabibi floated the dinar over a 6 month period to raise the dinar from 3200 to $1 to about 1200 to $1.  Subsequent increases came afterward once the dinar was changed back to the peg.  A similar event is a very real possibility when the conditions warrant.

Not likely, different situation altogether as at the time they basically had no real economy nor even a fully functioning government. During that time they were being propped up by the U.S Government under the authority of the CPA. What's far more likely is that Iraq will eventually do EXACTLY WHAT THEY HAVE BEEN TELLING EVERYONE and re-denominate the currency, the proverbial LOP. They can continue on just as they are forever if they choose just as has South Korea or they could do as many other countries before them has done, and as they have been plainly telling everyone they intend to do, and issue a new currency with the new exchange rate -that's the way huge exchange rate changes are done!

It's as simple as this, increase the exchange rate drastically with the old currency and pay out many billions of dollars to speculators or re-denominate with a new currency and pay no one anything, MANY countries have chosen the latter but not a single one in history has done the first option (as if that really is an option) wonder why that would be?


Also consider that never in the history of the world has any country had a huge percentage of it's currency in the hands of  foreigner speculators just waiting to swoop in and drain their foreign reserves!

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Post by FS4Enthusiast on Mon Aug 10, 2015 9:17 pm

@muskie wrote:Your argument is just referencing guru folklore, not monetary policy. The dinar will rise in value not because it has to, or some guru story of a mythical RV, but because it will be used as a monetary tool to improve the economic conditions within Iraq.  An example comes from Iraq itself back in 2004 when Dr. Shabibi floated the dinar over a 6 month period to raise the dinar from 3200 to $1 to about 1200 to $1.  Subsequent increases came afterward once the dinar was changed back to the peg.  A similar event is a very real possibility when the conditions warrant.

Here's the 2004 rates.  Page 30.  The lowest is 1467.  Today's is 1166 (though the market is usually far lower).  Going from 1467 to 1166 between 2004 and today is about a 2% rate of return before you pay any spreads.  Figure in typical spreads and/or use the street rate and it's no gain, just loss.  That the kind of investment you're looking for?  High risk and pays out 2% if you're lucky?

http://www.cbi.iq/documents/Annual_2004f.pdf


Last edited by FS4Enthusiast on Mon Aug 10, 2015 9:34 pm; edited 1 time in total

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Post by FS4Enthusiast on Mon Aug 10, 2015 9:33 pm

Take a look at the table and chart on page 5 here:

http://www.cbi.iq/documents/Annual_2002f.pdf

Note that in 1991 (back when the dinar was still worth something, though still not the $3 that people love to talk about like it's somehow relevant to the current dinar) their money supply was less than 25 billion. Halfway through 2002 it had ballooned to nearly 4 trillion.

Now imagine what that chart would look like if it went all the way to today, and their ~70 trillion M1 money supply.

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Post by dwm007 on Mon Aug 10, 2015 9:56 pm

All this talk about gradual appreciation, etc is simply pointless. The fact is, and it is a fact, that for the Dinar to increase in value to even .10, or any amount that would result in significant profit for the multitude of speculators, would require that Iraq have enough reserves to cover a payout of hundreds of billions of dollars! There would be hundreds of billions, and that's being absurdly conservative considering Sterling alone dumped over a half Trillion Dinar onto speculators, of dollars worth of Dinar in the U.S. alone! Iraq has to cover over 90 Trillion Dinars but even if someone wants to argue that they only have to cover physical cash it's still several Trillion Dinars, estimated to be over 30 Trillion for both domestic circulation and in the hands of foreigners. To increase their reserves from the well under $100 Million they have now would take ten years to accumulate even $500 Million at an increase of 50% per year. Of course a corresponding and ongoing rate increase such as that would attract swarms of currency speculators that would bleed them dry but even ignoring that even at ten years the $500 Million wouldn't even begin to cover a .10 exchange increase never mind a$1.

The problem is just this, for a $1 exchange rate EACH Dinar must increase by 1000 times so when we look at the hundreds of thousands of bundles of 25,000 Dinar bills that came into this country it becomes easy to see how Trillions would be involved. Iraq has about six times as many Dinar as the U.S. has Dollars, they can of course do this because the Dinar is worth 1000 times less than the Dollar. Now be it by "RV" or gradual appreciation either way to become worth one to one would mean that Iraq would have a Dollar net worth 6 times greater than the U.S. so again where do those dollars come from?

People just can't seem to get over the $3 plus rate Iraq once had and want to believe that they can somehow "RV" or "RI" back to what they once were but it simply doesn't work that way and never will! When the exchange rate was $3 plus they had reserves in amounts very much as they do today BUT they also had only a few Billion (24/25 Billion +/-) Dinars in circulation at the same time.  Approximately $75 Billion in reserves covering approximately $25 Billion Dinars thus the $3 rate. People it's not like that today! Today, due to massive past inflation, that same $75 Billion has to cover 90 TRILLION Dinars! At $75 Billion in reserves Iraq can have a high exchange and low currency circulation numbers (like they did back when it was $3) or they can have a low exchange rate and high currency circulation numbers but both can't be high! The only way Iraq can back a $1 exchange rate would be to reduce the currency figures from 90 Trillion to 90 Billion, in other words they would have to reduce the circulation by 99+%! There is no possible way to do this without removing the three zeros, it's not possible to gradually withdraw this much currency from circulation. Remember that they can not just take it and for every Dinar they tried to remove from circulation they would have to pay for it and that would come from the reserves, of course they could build up their reserves to $90 Trillion, good luck doing that!

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Post by Muskie on Mon Aug 10, 2015 10:14 pm

Again, your talking in guru folklore, monetary policy does not work as you say.  Countries with sound monetary policy, low inflation, huge economic potential, don't redenominate.  Conversely, countries that have lost credibility,  have failed domestic and international politics, have central banks that  cannot manage inflationary pressures (Iraq currently has 2% inflation), then chose to redenomination. Though Iraq has characteristics that fall in this area, such as partial dollarization, citizens have not lost confidence in the national currency, nor is there widespread foreign currency substitution.  The central bank continues to control the money supply, therefore a redenomination is not a realistic option. As well, a redenomination often creates monetary illusion which further creates a loss of  credibility  in  the  currency. I don't know where "its as simple as this" comes from but certainly not any economic study, or research study or book.  The bottom line is a redenomination is a last resort and a sign of failure. Keep in mind, in the case of Iraq, it is important to realize that they are working diligently to create domestic and international trust (including recently obtained a court rules increasing CBI operational independence), and working to remove distortionary policies and creating market stability.  These are signs that they have no intent to redenominate.

You mention the financial aspect of a currency appreciating.  When a currency appreciates, it has just the opposite effect as you stay.  In any country, when a central bank moves toward exchange rate flexibility, it creates a news set of rules including market participants (the so called speculators you fear) to trade among themselves.  This is no financial drain on the originating central bank.
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Post by FS4Enthusiast on Mon Aug 10, 2015 10:19 pm

So you're hoping to make 20% over the next decade. Gotcha. Seems like a wise investment. Good luck.

What was Iraqs past inflation rate like?  How do you get rid of the effects of past hyperinflation?

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Post by Muskie on Mon Aug 10, 2015 10:42 pm

More guru folklore, Iraq never reached hyperinflation post war.  By shear definition, hyper inflation exists when when the inflation level reaches in excess of 50%.  Iraq highest level was somewhere near 30%.  In fact, it was stated by USAID under Accomplishments that assistance was given to the Iraqi Central Bank to stabilize the dinar, preventing hyperinflation, this enabling Iraqis to qualify for International Monetary Fund (IMF) resources and debt reduction.
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Post by FS4Enthusiast on Mon Aug 10, 2015 11:10 pm

@muskie wrote:More guru folklore, Iraq never reached hyperinflation post war.  By shear definition, hyper inflation exists when when the inflation level reaches in excess of 50%.  Iraq highest level was somewhere near 30%.  In fact, it was stated by USAID under Accomplishments that assistance was given to the Iraqi Central Bank to stabilize the dinar, preventing hyperinflation, this enabling Iraqis to qualify for International Monetary Fund (IMF) resources and debt reduction.

Where are you getting your inflation numbers?

http://www.tradingeconomics.com/iraq/inflation-cpi

Regardless:

They went from 25 billion M1 to 70 trillion M1.  That isn't hyperinflation?

A sack of groceries went from costing 10 dinar to 30,000 dinar.  That isn't hyperinflation?

Whether or not you call it hyperinflation is irrelevant.  How do you get rid of the effects of that massive amount of past inflation?

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Post by Muskie on Mon Aug 10, 2015 11:53 pm

I didn't call it anything.  I just stated what the experts said.  Semantics don't play a part in this because the statement above is absolute. The statement is very forthright!

Don't ask me for your answers, that is for you to figure out.
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Post by FS4Enthusiast on Tue Aug 11, 2015 12:01 am

Lol, I already know the answer. Hint: it isn't by floating the currency. 

Let me guess, you're like that fool Kap that thinks floating up 10,000% over 2 or 3 years is "gradual appreciation"?

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Post by Muskie on Tue Aug 11, 2015 12:59 am

I do not know what others believe, but I do know how to read.  And I have ample evidence from very credible organizations that the dinar will appreciate in value.  You brought nothing to this conversation but rhetoric and guru folklore as your claim to fame.
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Post by kenlej on Tue Aug 11, 2015 2:18 am

@muskie wrote:I do not know what others believe, but I do know how to read.  And I have ample evidence from very credible organizations that the dinar will appreciate in value.  You brought nothing to this conversation but rhetoric and guru folklore as your claim to fame.
And u brought what? All I've seen from u is your mouth running. Show us these credible articles that u have. U are the one who is acting like the gurus by spouting unfounded garbage that the dinar will appreciate and I showed u a graph that they printed 7 trillion dinar from Oct 2014 and your saying that will not have an effect LMAO  Trials For Dinar Holders - Marcus Curtis 2322496710 Trials For Dinar Holders - Marcus Curtis 2322496710 Trials For Dinar Holders - Marcus Curtis 3508649203 Trials For Dinar Holders - Marcus Curtis 3508649203 Trials For Dinar Holders - Marcus Curtis 3508649203
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Post by dwm007 on Tue Aug 11, 2015 3:36 am

@muskie wrote:I do not know what others believe, but I do know how to read.  And I have ample evidence from very credible organizations that the dinar will appreciate in value.  You brought nothing to this conversation but rhetoric and guru folklore as your claim to fame.

We brought figures and links to explain our position but you brought what? Instead of showing us where those figures were wrong you simply resort to calling our posts "guru folklore"! You have done little else BUT talk "guru folklore" by using terms such as "gradual appreciation"  that you attempt to explain only with your statement of "I have ample evidence from very credible organizations",

Lol, anonymous "evidence from very credible organizations" and you accuse us of resorting to guru folklore?


"Guru folklore" LOL, you keep using "guru folklore" when what we have been saying is just the opposite of "guru folklore"! Do you mean Iraq having a money supply of approximately 90 TRILLION Dinars is "guru folklore"? You can check the CBI website to verify that or do you think maybe the Iraqis are "gurus? Now while you're at it you might want to check to see what these Iraqi gurus say their cash reserves are?

Maybe you can give us a brief description of just how much you are expecting the Dinar to "gradually rise" and how fast to the point of being profitable? When you try to crunch those numbers the sheer absurdity of such an idea starts to become apparent.
 

The thing is that no matter how you try to twist things around the FACT is that Iraq has less then $100 Billion in reserves to back their 90 Trillion Dinars money supply, there are ONLY two ways they can increase the rate without resorting to re-denomination/lop, by either reducing the money supply or increasing the cash reserves. There simply is no way to significantly increase the value of the Dinar without changing that reserve/money supply ratio! For it to increase to $1 per Dinar would require a reduction of the 90 Trillion Dinar supply by 89 Trillion 900 Billion Dinars, over 99% would you like to explain to us just how they can do that? Or they would have to increase the cash reserves by over 89 Trillion Dollars, or more than twice the amount of money on planet Earth. How is it possible to do either?

That $100 Billion (actually only around $70 Billion) is what they have and that's what would be used to pay speculators who want Dollars for their Dinar. Since the numbers of Dinars in the hands of speculators is in the Trillions (Sterling alone sold over a half Trillion remember?) just where does Iraq get the money to pay these speculators? You can talk "gradual appreciation" from now until doomsday and it does not explain the numbers!

Please answer this, How does Iraq "gradually appreciate" high enough to pay even .10 per Dinar when speculators hold Trillions? How would they pay even $100 Billion to speculators leaving themselves penniless if speculators held only an absurdly estimated $100 Billion Dinars? You like to talk about appreciation and "guru folklore" how about you talk some numbers! Please explain those numbers to us and how that "Gradual Appreciation" works by the numbers not just in principle.


BTW re-denomination/lop is NOT a sign, as you said, of failure nor is it a last resort! It actually is done AFTER successfully bringing inflation under control and is simply a tool to remove effects of PAST inflation, it is not a means of trying to control inflation! By that it is considered a sign of success and strength rather than failure and it's the first choice for most countries in dealing with PAST, but now under control, inflationary effects. Basically re-denomination is a clean up tool to streamline an inflated and bloated currency AFTER he inflationary problems have been solved.

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Post by FS4Enthusiast on Tue Aug 11, 2015 7:10 am

@muskie wrote:I do not know what others believe, but I do know how to read.  And I have ample evidence from very credible organizations that the dinar will appreciate in value.  You brought nothing to this conversation but rhetoric and guru folklore as your claim to fame.
Sure. It could go all the way up to 1000 to 1 or so, though it's unlikely. 

All I've seen you being is 2004 exchange rates that you were totally wrong about (there's some guru folklore for you). 

There's no reason the IQD would appreciate to even half a cent. Look at their money supply and their willingness to print trillions of dinar to satisfy any additional demand, most of said demand coming from clueless dinar speculators that they have no interest in enriching. 

Your false ideas about re denominations and inflation rates are also straight out of the guru handbook. 

An increase to 1 cent would make the relationship between their  GDP, money supply, and reserves make no sense whatsoever.  That's a fact supported by ALL the numbers.

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Post by Muskie on Tue Aug 11, 2015 7:36 am

Take up your argument with USAID, the IMF and other agencies.  I'm sorry your beliefs don't match their expertise  and concise analysis.   But I'm sticking with the professionals over wannabe's who run into forums spouting off incorrect statements and guru folklore in efforts to convince people there will be no gain on the dinar.  Hogwash!
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Post by FS4Enthusiast on Tue Aug 11, 2015 7:52 am

@muskie wrote:Take up your argument with USAID, the IMF and other agencies.  I'm sorry your beliefs don't match their expertise  and concise analysis.   But I'm sticking with the professionals over wannabe's who run into forums spouting off incorrect statements and guru folklore in efforts to convince people there will be no gain on the dinar.  Hogwash!
Where, again, did they say it could increase to 1 cent?

Incorrect statements like yours about the exchange rate in 2004?

Guru folklore like your false and ignorant statements about redenomination?

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Post by MD13 on Tue Aug 11, 2015 10:58 am

Can anyone show Iraq and world document about ...intended for circulation in Iraq ... but it doesn't say they cant go out of the country

Article 32 – Issuance of Currency. 1. The CBI shall have the exclusive right to issue banknotes and coins INTENDED for CIRCULATION in Iraq. Banknotes issued under this Article shall be the first charge on the assets of the CBI. The CBI shall make appropriate arrangements for the issue of its banknotes and coins for circulation in Iraq. Banknotes and coins issued by the CBI and intended for circulation in Iraq are not: promissory Notes, Bills of Exchange, or any other type of commercial document under the applicable commercial law, and the CBI is obligated to honor them only as provided for in this Law. iraqcurrencywatch.wordpre... read all at Article 32 – Issuance of Currency.


Where is official document stating  section 32 of Iraq’s currency laws it is illegal to export their currency outside of Iraq

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Post by dwm007 on Tue Aug 11, 2015 11:13 am

@muskie wrote:Take up your argument with USAID, the IMF and other agencies.  I'm sorry your beliefs don't match their expertise  and concise analysis.   But I'm sticking with the professionals over wannabe's who run into forums spouting off incorrect statements and guru folklore in efforts to convince people there will be no gain on the dinar.  Hogwash!


Care to elaborate a bit on that and maybe provide a few links?

I didn't think so and I also didn't see any of the figures I asked you about. As for the "guru folklore" I would again like to ask you to be a bit more specific and point out something, anything, that has been said that even remotely resembles what the gurus have been spewing all these years. You are no different than the average Dinarian, you hear them talking about increases and instantly get excited at the prospect of getting rich from a war torn third world country teetering on the brink of civil war from sectarian strife, a country that ten years after the war was supposedly ended still  doesn't even have basics such as electricity and running water for a large part of the population and can't keep it going 24 hours a day for those that do have it, yeah I'm SURE the IMF and USAID are expecting  "gradual and steady" increases in their exchange rates, should start just any day now! Duh, right!

Why is that you can't see that they are talking about tiny increases IF they are even talking about the pegged rate anyway, by far most of the time they are talking about the street, or unofficial rate that the population uses. They can't even get that to come close to the official exchange rate and THAT'S the rate almost all of the articles coming out of Iraq are talking about yet Dinarians get all giddy and excited every time they see "rate increase" and think they are about to get rich! THINK ABOUT IT! They are trying desperately to get the street rate more in line with the official rate, look at what the Iraqis are saying in the many articles that have been referenced! They continuously talk of exchange rates in excess of 1300 to one and higher, recently well over 1400 to one for a brief period! That's obviously the unofficial rate but that part is simply ignored by those who think it is "good news".


They have taken drastic measures to try and get this under control, severely curtailing money auctions, etc and yet even with those stated numbers Dinarians start the happy dance and post the articles with the cherry picked lines about the rate increases highlighted when CLEARLY they are talking only about the unofficial or street rate! Why can't you understand that the reserves of less than (quite a bit less) $100 Billion is what they have to base all this on! You can twist it around and try to dodge the issue by screaming "guru folklore" all you want but you still can't explain how Iraq is going to "gradually raise the rates" to a net worth that would exceed their reserves, you can't do it! Those reserves are the limiting factor period! They can not have a rate times the circulation numbers that would exceed a Dollar amount of more than the reserves! Besides that you also have yet to try and explain how Iraq is supposed to pay to foreign speculators several times more money than they have backing their currency, and clearly even .10 to the Dinar would far exceed the less than $100 Billion they have, nor can you explain WHY Iraq would do such a thing in the first place!


 Why don't you stop the childish name games that you have (predictably) resorted to and explain how your numbers work! Go ahead, no name calling or insults just a serious discussion about how these numbers are supposed to work out. How about it, that's fair don't you think? I will make it easy for you, start out by explaining how Iraq can "gradually raise" the exchange rate to a profitable level for Dinar holders when even 100% of the current reserves wouldn't even begin to cover what just the U.S. speculators hold at even a low rate of 10 cents.

There you go, a simple question now all you have to do is address that with some figures instead of vague references to "credible sources".

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Post by dwm007 on Tue Aug 11, 2015 11:29 am

MD12 asks

Where is official document stating  section 32 of Iraq’s currency laws it is illegal to export their currency outside of Iraq




Having Dinar outside the country is not a criminal matter, it's about them saying they are not legally obligated to honor currency outside the country,

"The CBI shall make appropriate arrangements for the issue of its banknotes and coins for circulation "IN" Iraq"


and,


" and intended for circulation "IN" Iraq are not: promissory Notes, Bills of Exchange, or any other type of commercial document under the applicable commercial law, and the CBI is obligated to honor them only as provided for in this Law".


[Emphasis on "in" added]


The key words here being,



"are not: promissory Notes, Bills of Exchange, or any other type of commercial document under the applicable commercial law
"

"the CBI is obligated to honor them only as provided for in this Law".

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Post by kenlej on Tue Aug 11, 2015 11:53 am

@muskie wrote:Take up your argument with USAID, the IMF and other agencies.  I'm sorry your beliefs don't match their expertise  and concise analysis.   But I'm sticking with the professionals over wannabe's who run into forums spouting off incorrect statements and guru folklore in efforts to convince people there will be no gain on the dinar.  Hogwash!
LMAO SHOW US THE ARTICLES STUPID THAT'S ALL WE ASK LMAO ''THE ARTICLES'' LMAO  Trials For Dinar Holders - Marcus Curtis 1656125192 omg Trials For Dinar Holders - Marcus Curtis 2322496710 Trials For Dinar Holders - Marcus Curtis 2322496710 Trials For Dinar Holders - Marcus Curtis 3508649203 Trials For Dinar Holders - Marcus Curtis 3508649203 raspberry raspberry
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Post by dwm007 on Tue Aug 11, 2015 12:33 pm

He say's he's sticking with the professionals? On what planet are there true economists that are predicting a significant rise in the Dinar? Just who are these mysterious "professionals"? Krap-O-Roni maybe? Maybe his Highness Adam is the professional he is referring to?


Muskie,
Come on now if you can't talk about the figures then at least let us in on these "professionals" you are talking about, is that too much to ask or would that be giving away your "secret contacts"?

Seriously no BS name games from either of us, all I am asking is for a serious and respectable discussion ABOUT THOSE MONEY FIGURES that you are so clearly dodging. I have stated numbers (close approximations) from the CBI and gave what I believe to be valid reasons why there is no way the exchange rate cab rise by a significant amount. You OTOH simply stated you had "professional sources", which you so conveniently fail to identify, and then resorted to the all to common Dinarian name games (accusing us of using guru lore) that Dinarians inevitably resort to when they can't explain their position.

Dodging the questions will not make your point, showing where our figures are wrong will. Nothing would please me more than to be wrong and to see family and friends get rich or at least make a sizable profit and if you have information to show this is really possible I would love to hear it!

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Post by RamblerNash on Tue Jul 19, 2016 1:49 pm

@kenlej wrote:
@dwm007 wrote:Maybe someone else needs to get educated by looking at how currencies have historically risen. When they are talking about a gradual rise they are not talking about large increases, very small increases over time at a rate that will NOT attract speculators for obvious reasons! No way is Iraq going to start a "predictable" substantial increase in these rates otherwise they would not only be inviting inflation but would be inundated with speculators using this "predictable" rise for profit, they aren't that stupid!  Besides, for the same reason they can't (that's CAN'T, not won't!) RV by any significant amount they will not (can not!) increase to any rate that exceeds their reserves, currently they state they have enough reserves to cover 1 1/2 times their currency but even if they did that it would not rise enough to cover the dealers' spreads never mind making anyone rich.

What is so hard for people to understand? Iraq has around +/- $70 billion worth of reserves to cover their currency and they can not exceed that without incurring drastic inflation! At a rate of $1 per Dinar that $70 billion dollars will not cover even one tenth of one trillion never mind the 80 trillion or so Dinar they have and THAT'S why the Dinar is less than a tenth of a cent and can not rise by any significant amount. Look at the numbers, just Sterling alone, according to the FBI files, did $600 million gross sales so that's well half a trillion Dinar just that one dealer sold! 600 billion Dinar (600 million dollars worth from that one dealer) is about 10 times Iraq's total reserves and that is if they paid out every cent of it to speculators and kept nothing for themselves! But of course they can't pay out even ten times more than they have!

The bottom line is that in order to "RV" to $1 per Dinar would require around 90 TRILLION dollars which just happens to be several times more money than collectively exists on planet Earth! As was asked above just where in the hell are all those dollars supposed to come from?

OK maybe you say "yeah but they don't have to cover their total liabilities (actually they would)  and only have to cover actual physical cash in circulation so in that case they "only" need about 30 TRILLION dollars to cover it or about twice the number of dollars in the U.S. money supply!

The Iraqi Dinar currently exchanges for about what it's worth, the money supply divided by the reserves works out to around 1000 to 1 (sound familiar?) and whether or not it rises by some overnight "RV" or a gradual rise over time it can NOT rise above what they have on hand to back it with which is currently less than $100 billion dollars, which just happens to be only a fraction of what it would take to cover just what speculators in the U.S. hold at a rate of1$ even if they gave away every cent in the effort! Heck, that wouldn't even cover what Sterling alone has sold at a rate of $1!

The numbers simply don't add up, not even remotely close, but the gurus and dealers count on people not adding it up. apparently a strategy that has worked quite well!
Good read!! A fact that is never mentioned is that revaluing a countries currency is bad for their economy especially a country who's GDP is beholden on exports because it makes the exports more expensive!! China had to have it's arm twisted to revalue their Yuan 10% because it made their products 10% more expensive in the USA so Iraq,Vietnam,Zimbabwe,Indonesia,Afghanistan& anymore if I missed 1 LMAO would commit economic suicide by raising their currency. Does that make sense to all the GCR believers???
:tup: :tup: :tup:
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