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Iraqi Dinar Opinion By Lynn Edgington  DinarDailyUpdates?bg=330099&fg=FFFFFF&anim=1

Iraqi Dinar Opinion By Lynn Edgington

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Iraqi Dinar Opinion By Lynn Edgington  Empty Iraqi Dinar Opinion By Lynn Edgington

Post by Ponee on Fri Sep 04, 2015 2:05 pm

This is from 2012, but still relevant for something to think about.  Found on EagleResearchAsociates . org


Iraqi Dinar Opinion

Posted by Lynn Edgington on Jun 28, 2012 in Alerts, Warnings, Alerts, & Hot Topics | 0 comments


I have received numerous requests to post our thoughts on the Iraqi Dinar. I explained that we had not been following the Iraqi Dinar since our first review of the push for people to buy the Dinar back in 2008. Just as I was about to post this, I received word that the Iraqi Dinar was going to re-denominate by the end of July. Of course it was said that the Dinar would be re-denominated on Martin Luther King Day last January, then it was going to be February 12, then it was going to be March 15, then it was going to be Memorial Day, then the end of June, and now the end of July. So I decided to hold off posting this to see if this deadline would also come and go without anything being done. And of course nothing was done. Three years ago, we provided our thoughts on the Iraqi Dinar and the re-denomination process, and our position has not changed since then.
As we mentioned back then, we felt it would be a re-denomination of the Iraqi Dinar, not a revaluation. We said that the only way any re-denomination of the Iraqi Dinar would take place would be for them to rebuild their infrastructure, get their oil wells up to at least 90% production levels, maintain a stable government, repay its debt to other nations, and then and only then did we believe any change would take place in the Iraqi Dinar. That was back in late 2008.

Now let’€™s fast forward to 2010. In 2010, the Central Bank of Iraq announced their plans for the re-denomination the Iraqi Dinar to ease cash transactions. The intention would be to drop three zeros from the nominal value of bank notes; but the actual value of the dinar would remain unchanged. That would mean that 1,000 IQD (pre-redenomination) and 1 dinar (post-redenomination) would both be worth the same amount in US Dollars. Although the announcement stated that the change would take place by the end of 2010, there has been no re-denomination as of this writing and no further announcements have been made since as to when this would take place. As stated by the Central Bank of Iraq, their mandate is to “ensure domestic price stability and foster a stable competitive market based financial system.€ If you want more information about the re-denomination, read €œIraq Planning Currency Re-denomination.€
You also have to take into consideration the inflationary condition of the world’€™s economies. Back in 2008, Iraqi inflation was around 3%, and today it is around 5.7%. Iraq also has an unemployment rate of 22-27%. Their electrical power is only operating at about 65% nationwide. All of these factors will play an important role in the valuation made when Iraq does their re-denomination of their currency.

It has been said that many nations hold Iraqi Dinars in their Central Banks. From a cursory reading of the 10K and the Annual Reports of these banks, they are not showing any holdings of Iraqi Dinar in the significant quantities claimed by those pushing you to buy Iraqi Dinars from them. All Central Banks, hold currencies in many different countries; but not at the levels we have seen claimed by those pushing the purchase of the Iraqi Dinar.

You have no guarantee that Iraq could just announce that all the old Iraqi Dinars, meaning the ones you hold, are no longer of value, and you can trade them in at 100 of your dinars for 1 of the new dinars. For that matter they could say 500,000 old dinars are now worth only 50 new dinars. The Iraqi Central Bank will make the determination that will be sure to stabilize their currency to other currencies. Can it go up? Of course, but past history has shown that when a currency is re-denominated it goes down, not up.
Now throw into the equation that all US forces will be out of Iraq by the end of the year, and you add even more instability to the area. This in turn will also delay the re-denomination of the currency. Meaning it could add even more years before the currency will redenomiate.

The favorite story line is anyone who buys now will soon become wealthy beyond their wildest imagination. Those who are selling the dinars have been claiming for 3 years now the re-denomination is going to take place very soon. You would think that after 3 years, people would catch on that they don’€™t know anything more than anyone else. My favorite story that was told to me was by a dear friend of mine. He was contacted by one of his friends who claimed he knew the Iraqi Minister of Finance, and he told my friend that the Iraqi Dinar was going to be re-denominated within a month at a 10-30% increase in exchange rate. That was 2+ years ago. So much for his friend knowing the Iraqi Minister of Finance and his assurance it was going to happen within a month back in 2009. The favorite line of a scammer is always they have access to ‘inside information€ so you will part with your money. As you can see, there are a lot of €œstories€ out there touting the purchase of the Iraqi Dinar.

The only ones we see making any significant money from the Iraqi Dinar are those pushing buying and selling you their Iraqi Dinars. Are we calling this a scam? No we are not, as the Iraqi Dinar is a real currency and is traded on the market exchanges. What we are saying is that those telling you this can only go up are just giving you their “€œhopeful opinion”€ it will. They have no clue what the Iraqi Dinar is going to do when the time comes for the re-denomination of the currency; for that matter neither do we.
We are not buying the line if you buy now you will be rich soon. You will be lucky to get a 1-1 exchange. Remember, there is a chance the Iraqi Government could issue all new dinars, and only give you a 100-1 exchange; 100 of your dinar for 1 of the new. It could be even 500-1, or 1,000-1. This is the risk you are taking. As long as you have not invested more than you can afford to lose, and are willing to take that kind of risk, then by all means speculate. But that is what you are doing is speculating, and be prepared to hold them for at least another 3-4 years, if not longer, before any re-denomination is done.

If you are planning on becoming rich quick before the end of this year from owning Iraqi Dinars, think again. We really do believe it will be at least 3 years before this re-denomination takes place, and it could very well be 4-5 years away. But this is just our best guess estimate. We have no crystal ball, and we admit the re-denomination could take place prior to our 3-year earliest estimate.

I am sure there are many of you reading this opinion who will totally disagree with our assessment. That is your right, but all predictions by the Iraqi guru’s have been wrong every time they have predicted this re-denomination would take place in the past three years. As I said before, we are not calling this a scam, but we are saying it is a sham. It is your money, and you can do with it as you like. At least you have another viewpoint from which to make your decision as to whether or not you purchase the Iraqi Dinar. We wish you all the best with your decision.

https://www.eagleresearchassociates.org/iraqi-dinar-opinion/

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Post by dwm007 on Fri Sep 04, 2015 2:15 pm

Old article but just as true today as was then, about the only thing that has changed is conditions in Iraq have gotten much worse!

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Post by Ssmith on Fri Sep 04, 2015 3:01 pm

Another counter to those that say that governments are holding large quantities of Dinar.


"It has been said that many nations hold Iraqi Dinars in their Central Banks. From a cursory reading of the 10K and the Annual Reports of these banks, they are not showing any holdings of Iraqi Dinar in the significant quantities claimed by those pushing you to buy Iraqi Dinars from them. All Central Banks, hold currencies in many different countries; but not at the levels we have seen claimed by those pushing the purchase of the Iraqi Dinar."
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Post by dwm007 on Fri Sep 04, 2015 4:14 pm

Ah but they're holding it in SECRET doncha know! They have all that deenar stashed back waiting for the day when the dysfunctional Government of Iraq decides it's going to raise it's self out of the poverty it's in by simply declaring their money to be worth at least a thousand times more than it is now. By Iraq doing this all those Governments of the world that hold Deenar will be able to cash them in and pay off their national debts! Damn, them countries is smart!

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Post by FS4Enthusiast on Fri Sep 04, 2015 4:37 pm

Hrmm.  Don't think I've ever seen this one before, which is surprising.  It's a little on the weak sauce side, especially for a group that appears to be dedicated to exposing scams.  I'll chalk that up to them normally dealing with cheeseball internet Ponzi/HYIP schemes and not really knowing that much about currencies or how they work.

My favorite story that was told to me was by a dear friend of mine. He was contacted by one of his friends who claimed he knew the Iraqi Minister of Finance, and he told my friend that the Iraqi Dinar was going to be re-denominated within a month at a 10-30% increase in exchange rate. That was 2+ years ago. So much for his friend knowing the Iraqi Minister of Finance and his assurance it was going to happen within a month back in 2009. The favorite line of a scammer is always they have access to ‘inside information€ so you will part with your money. As you can see, there are a lot of €œstories€ out there touting the purchase of the Iraqi Dinar.

1. Virtually no one buys IQD to make 10-30%.  That'd still have most of them losing money, as during the peak of the scam (2011 as far as I can tell) IQD was selling for $1200+ per million and that's a 40% premium.

2. Anyone that buys IQD to make 10-30% is a sucker.  It's inarguably a bad decision.  Even if you buy off eBay and don't pay much of a spread on the buy, you're going to get reamed on the sell spread.  On top of that the currency hasn't budged even a thousandth of a percent in years.  On top of that the market rate is frequently 10% or more LOWER than the rate you're paying.  If people were buying IQD to make 10-30% they've missed out on significant gains in far less risky investments.  Even after recent drops the DJIA is up 40% since 2011.  What's the IQD up?  0%.

Are we calling this a scam? No we are not, as the Iraqi Dinar is a real currency and is traded on the market exchanges.

And there's where you completely dropped the ball.  "The dinar" isn't a scam, it's "The RV" that is a scam.  The currency itself isn't, and no one is saying that the currency itself is, it's the notion that it has a reason to significantly (let alone massively) appreciate that is the scam.

You will be lucky to get a 1-1 exchange. Remember, there is a chance the Iraqi Government could issue all new dinars, and only give you a 100-1 exchange; 100 of your dinar for 1 of the new. It could be even 500-1, or 1,000-1.

Huh?  Why would Iraq redenominate at a 1-1 exchange?  It completely defeats the purpose of a redenomination.  On top of that, Iraq has already told you that if they do it'll be 1000 to 1, so I don't know why you're even talking about 100 to 1 or 500 to 1.  And on top of that, even if it were 100 to 1 there's no reason to think speculators would make any money off it.  Whether you redenominate 10 to 1 (as I believe happened in postwar Germany) or 1,000,000,000 to 1 (which happened in Zimbabwe), currency holders still make no money.  You end up with the same value you started with, the only thing that changes is the number of zeros on the bills.

If you are planning on becoming rich quick before the end of this year from owning Iraqi Dinars, think again. We really do believe it will be at least 3 years before this re-denomination takes place, and it could very well be 4-5 years away. But this is just our best guess estimate. We have no crystal ball, and we admit the re-denomination could take place prior to our 3-year earliest estimate.

This is really the worst statement.  Makes it seem like they're saying you might not get rich before the end of the year, but maybe you will in 3-5 years.  You won't.  Not in 1 year, not 5 years, not in 50 years.  Yeah, the redenomination might take place in 3-5 years.  And no one will make a penny on it.  Redenominations don't make people rich.  Ever.

If you want to see what a real expert says about the dinar, then John Jagerson is your man.

http://investorplace.com/2014/06/iraqi-dinar-scam/#.VeoAovZVhBc

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Post by Ponee on Sat Aug 06, 2016 11:04 am

Great post and thread

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