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Mnt Goat News Brief - "This is now a “fixed” rate" 6/4/20 DinarDailyUpdates?bg=330099&fg=FFFFFF&anim=1

Mnt Goat News Brief - "This is now a “fixed” rate" 6/4/20

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Mnt Goat News Brief - "This is now a “fixed” rate" 6/4/20 Empty Mnt Goat News Brief - "This is now a “fixed” rate" 6/4/20

Post by RamblerNash on Fri Jun 05, 2020 9:26 pm

Hi Everyone,

I bring you WOW news today.  

Today’s newsletter is short but all very good. I say good because they are now actually openly debating all the options as to what to do to save the economy of Iraq. Part of these discussions does include ending the currency auctions and the possibility of a “float” but, as we can see, they mean a float against other global currencies. You can’t float the dinar against just the US dollar as it is now solely pegged just to the US dollar. This is now a “fixed” rate. So they discussions evolved around a drastic change.

By the way the CBI has already announced it WILL NOT devalue the dinar as a solution.

So, we have read many proposals already in articles as to what to do to save the Iraqi economy. The Iraqi people too read these articles as they are meant more for them not so much us. From some of these proposals the Central Bank has to respond to them. The CBI must make the government realize that they are independent and are the experts on the financial policy not the politicians.

Yes, the GOI (the politicians) must buy into the next move from the CBI and coordinate with it. But the politicians do not set policy. So here is the Central Bank’s response to much of the rumors and rhetoric about what to do to save the economy of Iraq. Most of these rumors and rhetoric comes from non-experts.

The Board of Directors of the Central Bank of Iraq sent an open letter to the three presidencies:

In its letter, the bank expressed the {Euphrates News} agency obtained a copy of it, expressing its “deep concern that some members of the House of Representatives resorted to the media and launched inaccurate and undocumented accusations towards the monetary authority in the country.

The most recent of which was one of the deputies accused of accusing the central bank of corruption and financing Wednesday in a formula intended to stir up the public and stir public opinion against state institutions.

And at a time when the CBI BANK URGED THE PRESIDENCY OF THE HOUSE OF REPRESENTATIVES TO TAKE WHAT IS NECESSARY TOWARDS THESE ACCUSATIONS AND DEPUTIES TO ABIDE BY THE LAW in the accusations against state institutions, it welcomes the hosting of deputies to see the work of the currency sale window and the work of all its departments and deal positively with their proposals.

More news….

PARLIAMENT VOTES ON A RESOLUTION REQUIRING THE GOVERNMENT TO SEND THE BUDGET LAW NO LATER THAN JUNE 30

 The parliament (parliament) on Wednesday gave the government until the end of June to send a draft budget for 2020.

Shafak News correspondent reported that Parliament voted on a decision committing the government to send the budget bill no later than June 30.

Parliament also finished the first reading of the domestic and foreign borrowing bill to finance the fiscal deficit of 2020.

More news….

The commander  of the Iranian Quds Force , Ismail Qaani , arrived in Baghdad today , Wednesday, with an Iranian government delegation that includes Energy Minister Reza Ardakanian and other officials .

Told a source politician familiar with the agency Twilight News, that Qaana entered the capital Baghdad in an official after receives payments on a visa from the Foreign Affairs of Iraq within the delegation , the government of Iran .

He added that the aim of the visit is to " unify positions towards the forthcoming strategic dialogue between

Baghdad and Washington ."

It is expected to address the " strategic dialogue " the fate of the strategic framework agreement signed between the two countries in 2008 , which paved the way for the withdrawal of US troops from Iraq by the end of 2011 after eight years of occupation, and painted the nature of the relations between the two countries at various levels.

Washington and Baghdad will also discuss reaching an agreement on the fate of US forces in Iraq, as Iran presses its allies in Iraq to drive US forces out of the country.

Alongside the Washington-led coalition, US forces have withdrawn from 6 military forces in Iraq since the killing of Soleimani and the engineer. The international coalition says this is part of the relocation and withdrawal from bases of a small number of soldiers.

More news….

ADVISER TO THE PRIME MINISTER, HISHAM DAOUD, SAID THAT SOME PREVIOUS GOVERNMENTS COULD NOT PROTECT THE SOVEREIGNTY OF IRAQ.

And David added in a televised interview followed by Mawazine News that "some previous governments could not protect the sovereignty of Iraq, and it is time for Iraq to return to its true status and sovereignty."

"We have relations in various aspects with the United States," he added.

"Important international dialogues will begin with the American side during these days through video circles and the prime minister will personally pursue these negotiations," he added.

And David had confirmed in previous statements that the dialogue would start on the tenth of this month, stating that "Iraq aspires to build relations with the countries of the world and there can be cooperation with the American side in the field of economy, education, armament and security information."

Also pointed out that the government is determined in its negotiations with the US side to preserve and protect the sovereignty of Iraq , "noting that the level of the negotiating team that would be the lowest of the rank of Minister.

The Arbil , said the representative of the region will participate in the Iraqi delegation in strategic with Washington dialogue.

He noted the statement the provincial government that it discussed the importance of the strategic dialogue between Iraq and the United States, which is scheduled to be launched this month with the participation of the Government of the region and that the President of the Presidium of the Kurdistan region will be represented in this dialogue.

the British newspaper revealed the choice of prime minister, Mustafa Kazmi, negotiating team to discuss several issues Within the expected strategic dialogue with Washington scheduled in mid-June, and the British Daily Express said, "Al-Kazemi has chosen a team of negotiators to discuss issues within a strategic dialogue that will be held this June with the United States."

She added that "the talks will not be held at the level of foreign ministers," noting that "the negotiating teams were divided into three categories, a political negotiating team, a military negotiating team, and an economic negotiating team."

The British newspaper pointed out that "these discussions had been agreed upon by the administration of former Prime Minister Adel Abdul Mahdi in late 2019," noting that "foreign policy for Iraq and the United States depends on the former's relationship with Iran."

For its part, the American Wall Street Journal reported, "The talks are an attempt to achieve a balance between the two competing powers and to keep Iraq from becoming a battleground between them."

She explained that "the United States and Iran have merged together behind an Iraqi politician who both see as a necessary person to prevent further chaos in his country."

The newspaper stressed that "

She noted that "despite the decline in the popular protests that forced his predecessor to resign, the popular anger is still burning and strong."

(Mnt Goat – note how the article does not talk about Iran as the main driving force of foreign intervention and corruption in Iraq. They do not emphasize that in 2011 the US did pull out and the Iranians pulled in. Since this time corruption has gone rapid and billions stolen from the Iraqi people thus all the real issues in Iraq began. So, who should really leave Iraq? What country is really the detriment to Iraqi sovereignty? Why always just emphasize the US leaving? Can you see the propaganda?)

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Formal Articles are below. Due to FACEBOOK limitations they do not print my RED colored fonts or italics, so my comments are in brackets (  ) throughout the articles. I will preface my comments with “Mnt Goat” so you know I am jumping in with observations. Also, I separated the articles with asterisks.

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Articles Begin

INCLUDING STOPPING THE CURRENCY AUCTION AND CHANGING THE DINAR PRICE .. 5 DEPUTIES PRESENT PROPOSALS TO BRIDGE THE BUDGET DEFICIT

On Wednesday, a group of deputies presented a set of proposals to the government aimed at filling the deficit in the budget of 2020 and facing the financial crisis caused by the collapse of world oil prices, the most important of which was stopping the currency auction and changing the dinar exchange rate.

The deputies said, in a joint statement, which was received / information / they are: Muzahim Al-Tamimi, Adnan Al-Zarfi, Qasim Al-Araji, Mohammed Al-Daraji, Mohammed Shiaa Al-Sudani, “ANY GOVERNMENT OR PARLIAMENTARY ACTION TOWARDS REDUCING SPENDING AND AUSTERITY MUST BE ACCOMPANIED BY A REAL APPROACH BY THE GOVERNMENT TO COMBAT ADMINISTRATIVE AND FINANCIAL CORRUPTION AND STOPPING THE PROCESSES OF WASTING PUBLIC MONEY that have occurred previously or will happen through activating the role of the oversight bodies and following up issues raised by members of the House of Representatives and the media, specifically strengthened with priorities, documents and documents, and that there are periodic clarifications on what these measures are from the government and judicial authorities, and we are appealing to the judicial authority to be present in this field in a way that enhances the citizen’s confidence in the state and its authorities in fighting corruption. ”

They suggested "stopping work in the outlets of selling the currency with preparing instructions whereby all importers are required to submit lists that include imported goods for the purpose of customs accounting in the General Authority for Customs and Taxes before transferring money and notify the Central Bank of accounting according to official correspondence accompanied by customs bills and taxes, and change the dinar exchange gradually in a way that does not affect the The citizen and to guarantee the provision of cash that the state needs. ”

They called for a "review of the import approach and specifying possible goods and products to issue a decision banning their import to allow government companies in the Ministry of Industry, THE PRIVATE SECTOR AND THE MIXED SECTOR TO QUALIFY THEIR FACTORIES AND PRODUCE THESE GOODS TO CREATE JOBS AND MAINTAIN HARD CURRENCY INSTEAD OF TAKING THEM OUT OF THE COUNTRY."

They stressed the need to "take adequate and rapid measures to control the border outlets and not to allow any unofficial port AND TO ASSIGN OFFICIALS AT A HIGH LEVEL OF INTEGRITY AND COURAGE ABLE TO CONTROL THESE BORDERS AND IMPLEMENT THE LAWS RELATED TO CUSTOMS TARIFFS and the protection of the national product and prevent importation and the application of the agricultural calendar, and OBLIGATING MOBILE PHONE COMPANIES TO PAY FINES, ENTITLEMENTS AND TAXES IMMEDIATELY WITH A LEGAL TECHNICAL REVIEW OF THE CONTRACTS OF THESE COMPANIES in a way that guarantees the national interest with the activation of the fourth license and presenting it to the public through the competent ministry.

They demanded to "ACTIVATE THE TAX SYSTEM AND RECONSIDER THE TAX LAWS IN A MANNER THAT ALLOWS THE DEVELOPMENT OF THIS SECTOR AND WHAT IT REPRESENTS OF IMPORTANT REVENUE FOR THE STATE, and to reactivate the initiative of the Central Bank to allocate funds for loans to the industrial, agricultural and real estate bank to encourage the private sector to borrow and implement projects that create true development that Loans and restrictions related to granting loans are eased, as well as allocating the necessary funds for lending to small and medium-sized youth projects in order to generate job opportunities and create small projects that could be a source of livelihood for young people at the present time. Its impact on the citizen's living conditions and needs. ”

They considered that "THESE AND OTHER PROPOSALS THAT WOULD PROVIDE FUNDS TO BRIDGE THE DEFICIT ON THE ONE HAND, and we see that these amounts are directed towards supporting the social protection network, the ration card, medicines and water sterilization, while supporting the educational and educational process and securing all its needs."

(Mnt Goat- this is one of those WOW articles. Remember these are members of the House of Representatives so the next area to take up these recommendations would be the Finance Committee and then the CBI. But I have to tell you this is already in motion and the CBI is already working on these measures. But it was very nice to see parliamentary members making their ideas heard and for once coming up with sensible recommendations that will work.)

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DO NOT DE-VALUE THE DINAR..WHY?

June 3, 2020 

Iraq is going through extremely sensitive conditions, as the Iraqi economy faces a real challenge after the catastrophic failure to find alternatives to selling crude oil. Barrel according to explorations in 2018, or 8.5% of thebalance’s global reserves – – and yet he annually imports 3.3 trillion Iraqi dinars in oil products – the annual report of importing Iraq 2018, the Central Statistical Organization 2019 – and he imports energy worth 7 trillion Iraqi dinars – the 2019 budget Iraqi facts:

Issue 4529 on 11/11/2019 – all of which can be produced in Iraq, as well as other resources such as agriculture, various industries, trade, tourism, etc., with no Sovereign Wealth Fund that provides additional imports and a portfolio to protect the future of generations, especially in times of crises, Iraq today He asks for aid to pay the salaries of employees and retirees because what enters the treasury is not equal to a quarter of what Iraq needs to cover salaries only.

The financial budget for the year 2019 was allocated to the salaries of retired civilians and the military (9,316,652,417,000) Iraqi dinars, and the salaries of employees equal (43,404,629,267,000) Iraqi dinars and total The annual rate for the year 2019 is (52,721,281,684,000) Iraqi dinars, which means that Iraq needs monthly (4,393,440,140,000) Iraqi dinars, and if we take into consideration that the Iraqi dinar exchange 1,200 dinars per dollar means that Iraq needs monthly to (3,660,000,000) approximately one dollar, while the GDP of Iraq is approximately (1,100,000,000) dollars for the month of March and (1,200,000,000) dollars approximately for the coming months, as Iraq needs (2.5) billion dollars approximately per month in order to cover monthly salary expenses only, this is regardless of other needs, and to address.

This catastrophic failure began to raise some voices in order to reduce the Iraqi dinar exchange rate against the US dollar in order to increase the budget number and reduce the deficit in it, and I find it necessary to clarify some of the terms, so the reader may be SURPRISED BY THE IGNORANCE OF MANY OF THOSE WHO SPEAK IN THIS FIELD AND PERHAPS THEY ARE IN IMPORTANT LOCATIONS OF RESPONSIBILITY:

Floating Exchange Rate:

A floating currency is the rate of currency that has floated so that it has BECOME FULLY LIBERALIZED, so the government or the central bank does not interfere in determining it directly, but it is AUTOMATICALLY GENERATED IN THE CURRENCY MARKET THROUGH THE SUPPLY AND DEMAND MECHANISM that allows by setting the exchange rate of the national currency against foreign currencies.

Fixed Exchange Rate:

A specific price will be set against a major global currency (usually the US dollar, but also other major currencies such as the euro, yen, or basket of currencies), in order to maintain on the local exchange rate, the central bank buys and sells its own currency on the foreign exchange market for the currency in which it is linked.

Devaluation:

is the devaluation of the official exchange rate of this currency against an international reference currency (the US dollar or the euro, for example), so that the number of units of foreign currency that can be obtained against one unit of the national currency is low, and it is correct to talk about devaluation when it is the exchange rate is subject to the direct management of the government or the central bank, which determines this price through a government decision, and according to the same logic.

Revaluation:

It is possible to talk about raising the price of the currency Revaluation in exchange for reducing it, and this is when the exchange rate is subject to the direct management of the government or the central bank as well, and we note that the reduction the price of the currency and its elevation are within one framework which is the fixed exchange of the currency, but when the exchange rate is subject to the forces of supply and demand (floating the currency) and there is a decline in the value of this currency, depreciation of the currency, the decline is an automatic result of the free interaction between supply and demand in the foreign exchange market without interference direct from the government or the central bank, according to the same logic, we can talk about the rise in the value of the currency Appreciation versus its decline, and we note that the rise and fall of the currency price within the currency float.

Since Iraq currently works within the fixed rate system, we can talk about reducing and raising the exchange rate of the currency, and here I do not want to differentiate between the two systems, each of them has its conditions despite the market economy and its idea that the state should not interfere in economic activities and let the market control itself.

It operates a system of FLOATING THE CURRENCY AND ITS PRICE DEPENDS ON THE IRON PRINCIPLE OF SUPPLY AND DEMAND, but the actual conditions of Iraq do not allow for reasons that are too long to be explained.

Countries with a fixed exchange rate resort to reducing the currency exchange rate for economic reasons in improving their balance of trade mainly due to an increase in domestic production versus the importer.

The currency reduction makes the difference between the outside and the inside and reduces the importer in front of the exporter, and this assumes that there is internal production It covers the local need and wants to preserve it and export it abroad, but in the Iraqi case, unfortunately, there is no industry, no agriculture, no internal production, it covers the local need as well as being an exporter, as Iraq has nothing to export other than Crude Oil, and I speak here as for the reality of what is there and not what I am calling for, the total imports for the year 2018 for commodities and petroleum products amounted to (37) billion dollars, equivalent to (43.8) trillion Iraqi dinars, and the total imports for the year 2018 for the non-oil commodities (34.1 dollars) Equivalent (40.5) One trillion Iraqi dinars, and IRAQ HAS NO NEED TO REDUCE THE EXCHANGE RATE, but it is sufficient for it to prevent the import of any material that can be dispensed with.

As for the real effect of the devaluation, it is the direct punishment for the Iraqi people, if we know that 6 million Iraqis receive a salary or aid from the Iraqi government and the number of individuals.

The average Iraqi family is 5 people, we are talking about about 30 million Iraqis who live on what they receive from salaries or aid from the Iraqi government, all of these will be affected by this procedure, because inflation occurs. Inflation in prices is due to the low purchasing power of the Iraqi dinar.

An Iraqi after a currency devaluation would become worth 500 thousand dinars, and if she receives now a number that is a million, therefore she will live in great distress because of this reduction, and the other affected are the owners of internal debts in the local currency, which amount to about 40 trillion dinars, which represent treasury transfers and debits with banks.

The government and the central bank for companies, contractors, and merchants, and if they are a number, it will remain that the Iraqi government owes them to 40 trillion, but after the devaluation they will owe 20 trillion on the assumption that it has been cut in half. As for the external debtor, it remains the same because in foreign currency the dollar or the like.

Another issue remains here is the confidence of investors and companies in the currency after the devaluation is much less because the stability of the currency is one of the factors that encourage investment and entry in projects as well as problems related to economic feasibility after the devaluation, which is the basis of the intervention of the government or the central bank in fixing the exchange rate or only for work the principle of floating currency from the beginning.

Hence, we believe that those who seek to actually depreciate the currency are punishing the Iraqi people because of the wrong policies and economic failure that brought the country to this situation, as the people in this bear the mistakes of politicians and are punished instead of them.

(Mnt Goat – yet another very good article this period. All of you investors should read and try to understand the pro and cons of each of these areas of concern: Fixed Rate, Floating, Devaluation, Revaluation and their effects on an economy as fragile as the Iraqi one.)

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Articles End

Their words not mine…..No Rumors, No Hype, No Opinions ,,,,,

                                             Just the FACTS!

Disclaimer: All information in this newsletter is not intended for investment decisions / purposes. Mnt Goat is not a financial analyst, planner, banker, attorney or associated in any role with giving out professional investment advice.

In ending I want everyone to know your constant prayers in the fight against evil (ISIS) and now the corruption in Iraq have worked. God has guided these young men and women on the battle field. He has guided the honest, patriots of Iraq to fight for their homeland.  So this new war now on our citizens is underway. New battles are raging every day over corruption.  These are battles to save our societies from the corrupt politicians and secret societies who are bent on taking what they want from our current wealth and from future generations without our permission. We must keep praying for the end to the rapid corruption and enslavement of people in Iraq and also in the United States. We must pray for our leaders that they may be anointed by the Holy Spirit and guided to do God’s work. We must stand by them and let them know we are still there to support them, even after the election is over. I have composed a prayer maybe we can all pray today in our own way and until the reinstatement of the Iraq dinar occurs.

PRAYER

“For all leaders of all nations, that they may be anointed by the Holy Spirit to do God’s will and work to bring about abundance and prosperity to their nation. 

To fight this waging war on corruption, our freedoms, our liberties, socialist plans and injustice.

To bring all those corrupt to justice and pay for their crimes no matter how high up in the government they are.

To end the corona virus “man-made crisis” and to awaken people everywhere of the dark side and the tools it will use to gain power and control.

That the FREE WORLD may be a shining example for the rest of the entire planet.

In the name of Jesus Christ our King and Savior, Amen” 

Auf Wiedersehen

Much love to ya all,

Mnt Goat
RamblerNash
RamblerNash
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