Dinar Daily
Would you like to react to this message? Create an account in a few clicks or log in to continue.

Get Daily Updates of the NEWS & GURUS in your EMAIL
CHECK YOUR EMAIL for VERIFICATION

Enter your email address:

"Delete the Zeros" Article DinarDailyUpdates?bg=330099&fg=FFFFFF&anim=1

"Delete the Zeros" Article

Go down

"Delete the Zeros" Article Empty "Delete the Zeros" Article

Post by RamblerNash on Sun Nov 20, 2016 4:00 pm

"Delete the Zeros" Article Header-2

"Delete the Zeros" Article


Saturday, March 8, 2014


A couple of days ago the following article came out, and it got a lot of responses from gurus.  I figured I'd throw my observations into the mix, too.  See my comments below the article.



**********************************************

"Delete the Zeros" Article %D8%AD%D8%B0%D9%81-%D8%A7%D9%84%D8%A7%D8%B5%D9%81%D8%A7%D8%B1

1. BAGHDAD / newspaper rectitude - the central bank began to examine the decision to amend the categories of the Iraqi dinar since 2010 as it seeks today to the deletion of three zeros from the Iraqi currency, a project raises many concerns on the street level and the business community in Iraq.

2. The delayed implementation of the project after it has been amended, the central bank more than once due to concerns based predominantly to counterfeit currency circulating in the market and the security situation uncontrolled and open market for foreign goods.

3. It seems that economists are divided between supporters of the project see it as an opportunity to reduce the proportion of counterfeit currency and high inflation, unemployment, and between forewarned of economic shocks may dominate the Iraqi market due to the application of this project.

4. Where postponed the process of deleting the zeros more than once, until the called the Economic Committee in the House of Representatives on the seventh of July of the central bank, accelerate the process of deletion of zeros from the Iraqi currency, stressing that the process of deleting the zeros will increase the value of the Iraqi dinar will be reflected positively on the issue of reducing the rate of unemployment and poverty in the country.

5. The aim of the process - according to the Central Bank of Iraq - to reduce the enormous mass of cash flabby, and easing inflation, which he considered the bank (monetary inflation) caused by an increase in the amount of cash pumped into the street, which invited him to foot the deletion of three zeros from the currency.

6. According to reliable sources that the process of deletion of zeros will be this year, noting that the measure will gradually until full absorption banknotes old from the market completely, memory that the currencies of existing and new will work at the same time without reducing the value of any of them until the full absorption currency Current or that would be (old) time.

7. A member of the Finance Committee in Parliament Abdul Hussein al-Yasiri: "The year 2014 will see the deletion of zeros from the Iraqi currency, to be done in coordination with the Central Bank of Iraq."

"Delete the Zeros" Article %D8%B9%D8%A8%D8%AF-%D8%A7%D9%84%D8%AD%D8%B3%D9%8A%D9%86-%D8%A7%D9%84%D9%8A%D8%A7%D8%B3%D8%B1%D9%8A-300x187

8. The Yasiri that this project will lead to the reduction of the size of the national currency in circulation than four billion Iraqi dinars to one billion only.

9. For his part, Deputy Chairman of the Finance Committee in the Iraqi Parliament Ahmed Hassan Faizullah to delete the zeros will not change the purchasing power of the Iraqi dinar because it is linked to the size of the industrial production, import, and what saved the Iraqi dinar and whenever replaced the currency in 2007, is owning the central bank cash reserve of hard currency Osafth has formed a cover of the dinar.

10. For his part, said a member of the parliamentary Economic Committee Mahma Khalil said that "the current currency big bloated and not worthy of the country's citizens have a strong desire to keep the Iraqi dinar to compete with the dollar and other currencies."

11. He said: "It is possible to delete the zeros from the current currency, but it has been postponed until after the parliamentary elections, pointing out that studies are now to put safeguards in order to reduce fraud, or make sure not to current currency trading again."

12. A member of the parliamentary Economic Committee Abdul-Hussein Abtan that "the increase of the Iraqi dinar against the dollar is so vital to the citizen, where not enough that we have billions in deposits at the central bank in exchange rate of poverty and unemployment and a weak purchasing power of the citizen."

13. He says an economist and head of economic studies at the Center for Mustansiriya Dr. Abdul Rahman al-Mashhadani: "The process of deletion of zeros formality through which to change the face value of the coin without compromising real terms and have no raised real economic because the currency change will not lead to an increase in GDP of the country, explaining that the process is applied without any damage in many countries of the world during the last thirty years, including Bolivia in 1986, Russia in 1998, Turkey in 2005, North Korea in 2009. "

14. He called for Mashhadani to the need to distinguish between the process of change in real currency, which means changing the exchange rate of the local currency compared to the currencies of leadership as dollar Mthelaoho is leading to re-evaluate the prices of goods and services due to the change the real value of the currency, such as what happened in Iraq in 2007 when the value of the Iraqi dinar against the U.S. dollar to 1267 dinars after it was sold at a price of 1475 dinars in 2006, and like what was done when China devalued its currency iwan compared to other currencies even compete with Chinese goods other commodities in the world markets being cheaper.

15. And the expert a number of pros, where he said that the process of deletion of zeros will be provided by the new currency, considering changing the currency order will boost confidence with one of the symbols of national sovereignty of the country, and can increase confidence in the national currency with the citizen at home and the foreign investor abroad, as well as reducing process ( Dollarization) using this currency as a store of value and measurement, as well as to facilitate the process of trade within the country, and to facilitate the process of converting the dinar to other currencies.

16. As justification for the replacement process Vl_khasha follows:
"Delete the Zeros" Article %D8%B9%D8%A8%D8%AF-%D8%A7%D9%84%D8%AD%D8%B3%D9%8A%D9%86-%D8%B9%D8%A8%D8%B7%D8%A7%D9%86
- Gangs and mafias attempt to juggle the Iraqi currency and pumped into the local market for the destruction of the national economy, which spread recently.

- The presence of a cluster of cash has a big exporter leaves four trillion paper and worth more than $ 30 trillion dinars to the various groups, a large block size and the value in the economy is recovering day by day.

- Currently the largest category of cash is 25 000 dinars, equivalent to $ 21 almost and this requires a larger and a major effort to settle the daily transactions in terms of the time of counting, sorting, acceptance and safety and so we find the settlement of most of the daily transactions that increase Akiemha for the 20 million are in dollars.

- The presence of damage to a large proportion of the currency, especially in small denominations and inadmissible in circulation and constitute almost one-third of the money supply and not replaced gradually by the central bank.

- The difficulty of making the calculations under the numbers increase the number of Ocefarha zero for 14 of the practical and technical error occurred and the possibility of adding either zero or deleted.

17. From here, the process of lifting the zeros are in the attraction between economists between positives and its negatives is that there is almost a consensus that money laundering, forgery and the spread of financial and administrative corruption and economic instability will be a severe negative factors influencing the process of replacing the currency.

18. The Iraqi Central Bank acknowledged the existence of Banknotes fakes in commercial markets, and face Aamama to all banks to take the necessary, and detect the presence of vigorous attempts to rig the currency, calling on all government agencies concerned to fight for it if they grew up will be a threat to the Iraqi economy and a violation of his.

http://alestiqama.com/?p=73277




**********************************************




Before I offer my thoughts let's see what the gurus are saying.


Kaperoni -  ”Is the process will delete the zeros of the Iraqi currency to stop rigged?!” All I can say is WOW! This is exactly what Dr. Bakri said in his report…This article is correct that changing the currency in itself does not raise the value, but as the IMF stated “Balassa-Samuelson effect” meaning as the economy grows so does the exchange rate…in other words its a float! and it will rise based on supply and demand. And we know the new smaller bills could or would not be in circulation until the exchange rate rises. Quote: “the process of deletion of zeros will be provided by the new currency,” In other words, the transition from larger notes to smaller notes “deletes the zeros” and its not a LOP.


Enorrste -  “Is the process will delete the zeros of the Iraqi currency to stop rigged?!“   this article is a confirmation that we are on the right track. There will be a beginning of a free float THIS YEAR, followed by a GRADUAL RISE IN THE VALUE OF THE DINAR which will lead to a GRADUAL REMOVAL OF THE LARGE NOTES as the value of the dinar rises. Our journey is about to bear its fruit, assuming nothing ELSE comes along to derail it!


Stryker -  "Is the process will delete the zeros of the Iraqi currency to stop rigged?!"  Quote: "memory that the currencies of existing and new will work at the same time without reducing the value of any of them until the full absorption currency Current"   This IMO, says that all the currencies will have the same value and neither will be reduced according to this quote. Meaning each dinar no matter old or new will have the same value, example: Each dinar in a 25,000 dinar note will have the same value as the new 25 dinar note, IF each dinar is equal to $1 USD then the new 25 dinar note will be worth $25.00 USD and the 25,000 dinar note will be worth $25,000 USD.


Breitling -   "Great article!  ... babble babble ... velocity... blah blah blah ...... artificial inflation .... yak yak ... loppers are wrong .... yada yada yada ...." https://www.youtube.com/watch?v=uYRpi5PhSiM&list=UUFsclL8v97dpvyD5GmvGLFg (13 minutes in)


Tlar -   "this article is the best article in quite a while.  It confirms many things for our investment.  The first is it confirms no lop, it confirms it will happen this year 2014, it confirms, they will change the exchange rate itself, it confirms a dinar is a dinar (every note will be good and every denomination will be good), it confirms both currencies will be in use until all the old notes are collected, it confirms this will be an RV and not a float by this statement (the process of deletion of zeros will be provided by the new currency) meaning the currency will be issued at the same time they delete the zeros."



I'm not usually inclined to comment on news articles as I find them irrelevant for the most part, but when they create such a reaction in the dinar community I figure it's my duty to do so.  A lot of this is hard to understand as it's basically Arabish (Arabic/English/Gibberish) and I might be wrong on a few points, but here's how I break it down.

Paragraph 1 - Review of the history of the currency reform plan.

Paragraph 2 - Counterfeiting concerns.

Paragraph 3 - Mentions contrasting views among economists on the economic impact of redenominating.

Paragraph 4 - Economic committee claims that deleting the zeros will increase the value of the dinar.  That doesn't mean that the dinar that speculators hold will increase in value.  It's referring to the increase in value when they convert from the IQD (valued at $.00086) to the new dinar (valued at $.86).  This will give Iraq a currency that is near parity with the USD and according to the commitee will encourage foreign trade which will theoretically stimulate the Iraq economy and create jobs, which will help them to reduce poverty.

Paragraph 5 - The redenomination will reduce the money supply from tens of trillions of IQD to tens of billions of the new dinar.  As the higher-valued dinar is increasingly used, the problems with inflation of the street value (remember, the official value is pegged to the dollar so it only depreciates to the extent that the USD depreciates) will theoretically subside. 

Paragraphs 6,7 - The sources indicate that the redenomination will occur this year, and will continue until the old dinar (IQD) is out of circulation.  Previous articles have stated that this will take two years to carry out.

Paragraph 8 - Yasiri repeats that the money supply will be reduced.  They state from 4 billion to 1 billion.  The CBI financials report that the money supply outside of banks is about 34 trillion, so my guess is that they're referring to the total of notes in circulation. 

Paragraph 9 - States that the redenomination won't change the purchasing power of the dinar.   This is in contrast to the earlier statement that the value would increase.  How can you raise the value without increasing the purchasing power?  Simple!.  An even exchange of the old dinar at the old valuation for the new dinar at the new one.  A lop. 

Paragraph 10 - States that the people of Iraq want a more valuable currency.  Nothing new there.  They've wanted this for years, so that they can use their own currency like the US dollar.

Paragraph 11 - States reasons for delaying the redenomination.

Paragraph 12 - Repeats concerns over the need to redenominate.

Paragraph 13, 14 - Mashhadani doubts that the redenomination will have any economic impact, good or bad.  He seems to think that Iraq should actually revalue or possibly devalue the dinar back to the range where it was before they went to a crawling peg policy in 2006-2008 and raised the value by 26%.  By lowering the value they could benefit as China did when their currency's value was lower.  The word "coin" has been used in the past to refer to bills, so it's not just talking about coins as we use the word but currency in general which would include all denominations and all electronic currency.

Paragraph 15 - Other experts list a number of benefits to redenominating.

Paragraph 16 - One expert named Vl_khasha lists his reasons for supporting the redenomination.  Here's where it gets interesting to me.  In his second point he seems to be saying that there's 34 trillion dinar in cash, but 30 trillion was exported and only 4 trillion (maybe this is where they got the 4 billion figure in paragraph 8) is in circulation inside of Iraq.  This is something that TD mentioned recently after he sold off 95% of his dinar in expectation of a closed border RD.  Marcus Curtis has the same view, except that he estimates 25 trillion outside of Iraq.    

Paragraph 17 - One thing almost everybody agrees on is that the redenomination will encounter problems with criminal activity.

Paragraph 18 - The CBI acknowledges that counterfieit currency in the marketplace is a problem, and
calls upon all banks and government agencies to fight against counterfeiting. 




And now a couple of observations.  



First of all, I've said it before and I guess I'll keep saying it - deleting the zeros means redeonomination, as in L - O - P ... LOP!  (To my regular readers, I'm sorry if I bore you with my repetitions, but if the gurus keep repeating their lies I'm going to keep repeating the facts.  Newbies are constantly checking out the dinar and they need this information.)  You can read more in my post Deleting the Zeros.  It doesn't mean revaluation.  New currency has never been issued during a revaluation.  All that occurs when a central bank revalues a currency is that the exchange rate changes.  When you issue a new currency to replace one with zeros that were added because of hyperinflation that's a redeonomination and it's a neutral event, as in NO PROFIT.

And finally, they compare their currency reform plan to what has happened in other countries.   

"the process is applied without any damage in many countries of the world during the last thirty years, including Bolivia in 1986, Russia in 1998, Turkey in 2005, North Korea in 2009"


If you'll study the cases mentioned in that statement you'll see that none of them were revaluations.  They were all redenominations.


How the gurus can look at this article and conclude that it means anything other that the worst case scenario is beyond me.  Sorry kiddos, but this article is talking about a lop.  That's not Sammy saying that, it's the head of economic studies at the Center for Mustansiriya Dr. Abdul Rahman al-Mashhadan.  

You really don't need to torture yourself trying to make sense of these articles, and you don't need to be an economist or a currency expert to see what's going on with the currency reform.  All you really need is basic math and reading comprehension skills to understand a few things about economics and currency valuation.  Revaluations don't make people rich.  At best you might manage to make a little profit, but even that is a gamble.  Redenominations are the norm for currencies like the dinar, and that's what this article is addressing.  The gurus got it wrong here just like they always get it wrong. 

Cheers!


 


"Delete the Zeros" Article Sam+%25282%2529


http://dinardouchebags.blogspot.com/2014/03/delete-zeros-article.html
RamblerNash
RamblerNash
GURU HUNTER
GURU HUNTER

Posts : 18775
Join date : 2015-02-19

View user profile

Back to top Go down

"Delete the Zeros" Article Empty Re: "Delete the Zeros" Article

Post by RamblerNash on Sun Aug 04, 2019 2:13 am

* BUMP *
RamblerNash
RamblerNash
GURU HUNTER
GURU HUNTER

Posts : 18775
Join date : 2015-02-19

View user profile

Back to top Go down

Back to top


 
Permissions in this forum:
You cannot reply to topics in this forum