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Mnt Goat's Beg-A-Thon Continues! & News Brief 10/20/20 DinarDailyUpdates?bg=330099&fg=FFFFFF&anim=1

Mnt Goat's Beg-A-Thon Continues! & News Brief 10/20/20

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Mnt Goat's Beg-A-Thon Continues! & News Brief 10/20/20 Empty Mnt Goat's Beg-A-Thon Continues! & News Brief 10/20/20

Post by RamblerNash on Wed Oct 21, 2020 9:19 pm

Hi Everyone,

I bring you much news today.  

GIVE A GIFT TO MNT GOAT

I decided to allow everyone to give a Free-will GIFT to Mnt Goat on PayPal if you so desire. Here is the link below.

https:// paypal.me/ MntGoatNewsletter?locale.x=en_US

As usual, remember that for over 7 years, I have taken my own time from my gasthaus business to research and document findings about the revaluation of the Iraqi dinar. Please be generous but only if you can afford it and remember to give. I suggest $5-$10 a month but you decide. Whatever you can afford will be helpful in this time of Covid where nearly 50% of our business is now gone due to travel restrictions.

I hardly have the words to thank everyone who is supporting my newsletter efforts with all your ongoing gifts. Thank You, Thank You and Thank You again. This has made a huge difference in our lives.

More news….

So today I want to line up the news for you to understand what is going on these past couple days. To begin with parliament entertained the CBI and they talked about the so-called “White Paper”. Our friend Dr. Shabbi was present and gave a speech about FOATING the dinar. This past couple days, professor of economics at Basra University, Nabil Al-Marsoumi, revealed some items of the economic reform paper called (the White Paper) that the Ministry of Finance is working on to reform the Iraqi economy. So you get to finally read many of the reforms suggested in the White Paper we have been hearing about for so long.

Remember the CBI should be in independent organization and not need permission to manage the currency, however more out of courtesy, they do ask for a confirmation from the parliament on major projects. This would be a major project and part of the reforms needed to help save the economy and the dinar. But my important point in recent news is that they are actually seriously discussing putting the dinar on a FLOAT. Folks do you know just how good this news is? Is “WOW!” news for us. I am jumping up and down from all the articles on the subject matter of FLOATING the currency. I believe they are really going to do it this time. I could be wrong but I don’t think so. We need just to relax and let them work out the details. It is now mid-October and this comes in perfect timing for a January 2021 reinstatement. But something inside of my mind says – can they even wait that long since they are scrambling now to find solution on how they can meet the October dues and salaries to the citizens. This is 4 billion dollars. Remember the only had secured these dues until September and we are past that already. I know, I know you are going to tell me they always seem to find a solution at the last minute and it always turns out not to go to a float and reinstate. But I got to tell you this time there is so much positive discussion about doing the float. We can only go by what we read.

So what do we read and see in the recent news from Iraq then?

We know that in order to do this FLOAT they will NOT use the program rate and the currency auctions must be stopped in order to “reinstate” the dinar. I have gone over this process twice already in my recent newsletters. Please go read them for the entire process. I believe they are about to begin this process VERY SOON!

They also in the same breath talk about “increasing the GLOBAL DEMAND” which we all should know by now means to get rid of the auctions and get it back on FOREX and use the dinar for trade once again. Go read the articles for yourself below.

But as usual some economist also do not agree with Dr. Shabibi and the CBI in wanting to do this FLOAT and thus give their opinion in other articles in the news. So this only confirms to us again that they are serious about the FLOAT. We know the process that is involved and it means first accomplishing the “project to delete the zeros” and so articles also talk about doing this now too along with the thinking of the FLOAT. Folks this is all “WOW!” and fantastic news for us this period. It is not the re-education articles we expected at this time but is it very, very good news nonetheless. The re-education only comes later once they move ahead with a plan to execute on the outcome of these discussions.

In today’s news, economist Ahmed Al-Salami wrote an explanation about some countries deleting zeros from their currency and the possibility of applying this also to the Iraqi dinar, while referring to the possibility of making the Iraqi currency strong and have global demand, in what he described as the “free dinar” or  as we say free FLOAT. Then we read articles that another economist that is talking about the negative effects of printing more currency and how it would hurt the ability to FLOAT the dinar.

Then there is economist Nawar Al-Saadi who said that the floating of the Iraqi dinar is a big mistake during this period, because that will greatly harm the poor and those with limited income. But remember this is only his opinion. But the good news this confirmed once to us to us that the CBI is serious thinking about doing the FLOAT, thus the discussions continue with feedback both positive and negative from many economist sources.

Today we also read a very good article from a financial expert, who did not want to reveal his identity, but confirmed that "THE SHORTEST AND EASIEST SOLUTION IS TO RESORT TO THE CBI RESERVES AND MOVE TOWARDS PRINTING THE DINAR, BUT TAKING THIS PATH IS NOT A SOLUTION, RATHER IT IS SUICIDE." So we know they are not serious about flooding the market with more newly printed currency. The real fear is that the government and political leadership will resort to this solution instead of starting real radical reforms, in other words taking the easy way out, which require executive decisions issued by the government and other legislatively supported decisions by Parliament. But I along with many economists in Iraq are certain they will NOT this measure and print more dinar. Remember increasing the money supply leads to inflation and if you do it enough it will only lead to hyperinflation, something that the CBI has taken great pains to avoid.

More news….

REPORT WARNS OF POSSIBLE COLLAPSE IN VALUE OF IRAQI DINAR

17th October 2020  in Iraq Banking & Finance News, Politics

By John Lee.

An Iraqi government white paper has warned of a possible collapse in the value of the Iraqi dinar.

According to Farhad Alaaldin, writing for Rudaw, the recently-approved white paper refers on page 37 to the danger of using the Central Bank of Iraq (CBI) as a source of financing, saying that the authors believe it "will lead to severe pressure on the CBI's reserves and the resulting unsustainable future consequences."

He adds that this view was further confirmed by the group of experts writing the White Paper on page 42, who state that:

"Indirect monetary financing by the CBI is the only remaining source... The need for this reserve to finance imports of goods and services means ITS WILL DROP DANGEROUSLY TO LOW LEVELS WITHIN NINE MONTHS, which will ultimately lead to a real crisis in value of the Iraqi dinar, accompanied by the possibility of a collapse in its value."

The first article today is a really good one and justifies in detail the reasons why the dinar rate must increase against the dollar. This is part of the solution for the economic crisis.

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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

JUSTIFICATIONS FOR CHANGING THE “IRAQI DINAR” EXCHANGE RATE

Iraq is going through very sensitive conditions, as the Iraqi economy faces a real challenge after the excruciating failure to find alternatives to selling crude oil, prosthetic solutions, and weak control over public expenditures, and with the absence of sovereign investment funds that secure additional imports and a portfolio to protect the future of generations, especially in times of crisis.

Aid request to pay salaries:

Iraq today has reached a request for aid in order to pay the salaries of employees and retirees because what enters the treasury is not equal to less than half of what Iraq needs to cover salaries only, although the government has solutions if there is the will to improve the financial position and fill the budget deficit, by reducing public spending and controlling Wasted resources and support for the local industrial and agricultural product and other economic solutions, the most important of which is the central bank’s approach and monetary policy that restores the balance of the dinar’s price against the dollar in the daily auctions to sell the dollar by the Central Bank of Iraq, by raising the subsidy slightly from the exchange rate in a way that achieves the price change at a specific and studied rate To avoid the issue of inflation.

Taking into account international economic variables:

Our constant demand for a change in the exchange rate was based on a realistic vision that INCLUDED ALL ASPECTS OF INTERNATIONAL ECONOMIC VARIABLES due to the decline in oil prices and the Corona pandemic, as well as the chaos of imports, the loss of control and control over the border outlets, the volume of counterfeiting, corruption and smuggling through unofficial outlets, all causing the Iraqi market to be violated.

And dumping it with inferior and cheap commodities and preventing the upgrading of the local product, WHICH REQUIRES A REVIEW OF THE MONETARY POLICY TO CURB THIS CHAOS and achieve tax and customs revenues equivalent to the volume of imports, which we and with us many experts and specialists in financial affairs believe that the exchange rate must change, provided that it is accompanied by a set of supportive measures and decisions, to control Expected inflation.

The failure of the previous administration of the Central Bank of Iraq:

However, the previous administration of the Central Bank insisted on continuing with the policy of fixing the dinar’s price against foreign currencies, under the pretext that changing the exchange rate would reflect on high prices and inflation and harm vulnerable social strata and other justifications that do not get fat or rich from hunger. THE CONTINUED SALE OF THE CURRENCY AT A FIXED EXCHANGE RATE BY THE CENTRAL BANK WILL LEAD TO THE BANKRUPTCY OF THE STATE AND THE COLLAPSE OF THE ECONOMIC SYSTEM in conjunction with the decline in oil prices and the abandonment of a million barrels of its share for the benefit of others in these difficult circumstances the country is going through, The assumption that the survival of this equation, which is in support of imports, industries and exports of neighboring countries, will lead to the accumulation of goods in exchange for a cheap dollar that the exporting countries benefit from at the expense of the Iraqi economy stopping.

The basis on which we started by demanding a change in the exchange rate is the fact that the state is not fully in control of the imports of the border outlets, including those in the Kurdistan region.

Exchange rate change proposal:

Therefore, we included the proposal to change the exchange by collecting tax and customs duties in advance from importers in the window of currency sale, and to clarify the matter, if we calculate the price of oil specified in the draft budget law at (56) dollars per barrel, meaning the rate of decrease is (15%), so the exchange rate is assumed ( 1300) dinars per dollar, and if (5%) was levied for the tax and (15%) for the customs fee and added to the exchange rate to become (1500) dinars per dollar, so we would have withdrawn the rug from the corrupt in the northern, western, eastern and southern outlets and we got On revenues from the state treasury, the monetary result to the state treasury every day is the sale of a dollar at a rate of (200) million dollars, and in the case of adopting the new exchange rate, it will be (60) billion additional dinars for each auction day, which is approximately (18) trillion dinars annually.

Conclusions:

First – Achieving revenues for the federal government’s treasury that exceeds (18) trillion dinars annually from the amount of tax and customs, with a price difference at least.

Second – Elimination of currency smuggling, as imports will be real and in the amount of transferable sums.

Third – ending the phenomenon of tax and customs evasion at the border crossings.

Fourth – the submission of all ports to the authority of the federal government and thus solve the problem of imports of goods and goods from the ports of the Kurdistan region because of the preference in terms of taxes and customs fees.

Fifth – ending all tax and customs exemptions for institutions and government departments and others.

SIXTH – ENDING THE PHENOMENON OF THE MEDIATOR IN SELLING DOLLARS AND COMMISSIONS OF PRIVATE BANKS, BECAUSE DEALING MUST BE WITH THE REAL IMPORTER AND NOT WITH SPECULATORS, WHICH WILL BE REFLECTED IN THE DEVELOPMENT OF THE EXPORT SECTOR FOR LOCAL PRODUCTS AND THE CREATION OF JOB OPPORTUNITIES.

Seventh – Streamlined flow of goods and goods from the border crossings. We expect the new administration of the Central Bank of Iraq, which has taken positive steps to correct the previous paths and approaches, which are in line with the reform plan, more decisions to create a real banking sector, and we hope from them to study the ideas and proposals presented by our council that serve the public interest.

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THE FREE DINAR .. AN ECONOMIST TALKS ABOUT A MOVE THAT ESTABLISHES A GLOBAL DEMAND FOR THE IRAQI CURRENCY

The economist Ahmed Al-Salami wrote an explanation ABOUT SOME COUNTRIES DELETING ZEROS FROM THEIR CURRENCY AND THE POSSIBILITY OF APPLYING THEM IN IRAQ, while referring to the possibility of making the Iraqi currency strong and has global demand, in what he described as the free dinar.

“Iran will soon delete four zeros from its currency and convert it from the riyal to the new toman officially and have completed the legal series for that, and at that time it will be 100 dollars equal to 300 toman only instead of 3 million tomans or 30 million riyals,” Al-Salami said.

He added: “A digital deception previously carried out by the United States, Italy and Turkey, the United States deleted its dollar currencies with zeros in front of the previous European currencies, the French franc, the German mark and the English pound, and canceled the $ 10,000 currency and the $ 1,000 currency and withdrew it from banking and personal circulation forever.”

He continued: “Italy also re-zeroed the Italian lira, adjusted its value and deleted six zeros from it, and the million lira turned into one lira and a hundred million lira into 100 lira before it was merged with the euro currency in 2002, as well as that of Turkey, which converted one million Turkish liras into one lira and converted one hundred million pounds One hundred Turkish liras only ”.

He explained: “Suddenly, the Turkish currency was circulated and used abroad for circulation, and it entered Iraq and was used for dealing and the exchange rate as a store of value, and whoever used to work in the Shorja knows this after the Turkish currency was forgotten throughout the nineties and eighties and was an attempt to integrate Turkey with European economic values.”

And that “the current Iraqi dinar differs slightly because the Iraqi economy is consumerist, but that does not prevent it. IT IS POSSIBLE TO APPLY THAT AND USE THE DELETED IRAQI CURRENCY ZEROS by buying and importing industrial production lines for the manufacture of basic and luxury goods as much as possible, and this will revive the exchange rate of the dinar and the demand for it externally and shrinking.” Depletion of foreign currency to buy the most insignificant commodities and deplete the cash balance, instead of facilitating official and accounting transactions, packages, storage, transportation, use of versatile metal change and revolutionary digital currency through cards and gain confidence internally and externally, needs a revival, stimulation and progress in this aspect, easy projects that are waiting for their hero, below. CONCEPTUAL MODELS FOR THE DELETED IRAQI CURRENCY, THE “FREE DINAR” ZEROS.

(Mnt Goat – okay so finally an article talking about the possibility of deleting the zeros from the dinar and putting the dinar on a FLOAT. It does not say they are doing it but it is a good idea as this economist agrees with the idea.)

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MEMBER OF PARLIAMENTARY FINANCE: THE CENTRAL BANK DOES NOT NEED TO PRINT THE CURRENCY ... THE DINAR IS THREATENED WITH COLLAPSE

Member of Parliament’s Finance, Representative Sherwan Mirza, confirmed today, Monday (10/19-2020), that printing amounts of banknotes are linked to hard currency at the Central Bank of Iraq.

Mirza said in an interview with (Baghdad Today), "The printing of any sums of Iraqi cash is mainly related to the size of the financial cover for hard currencies at the Central Bank," noting that "any printing operation without a financial cover will lead to the collapse of the exchange rate, and thus lead To the collapse of the Iraqi dinar ".

He added, "The central bank has sufficient cash reserves, and it does not need to print any additional banknotes.

THE TALK AND RUMORS THAT HAS SPREAD RECENTLY ABOUT PRINTING A NEW CURRENCY AND PUMPING IT INTO THE IRAQI MARKET BY THE CENTRAL BANK IS NOT CORRECT, and it was denied in official statements by the central bank, which confirmed that even the exchange rate of the dinar against the dollar," he said.

Yesterday, a member of the Parliamentary Finance Committee, Naji Al-Saeedi, saw that printing currency by the Central Bank is a legal violation, and will harm the country's economic position and prevent the float of the currency.

(Mnt Goat – Is Saeedi telling us they intend to float the currency or at least are seriously considering it? By reading the next article we can clearly see that the CBI and the finance ministry is discussing the FLOAT seriously.)

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NAWAR AL-SAADI: IT IS NOT IN IRAQ'S INTEREST TO FLOAT ITS CURRENCY

Economist Nawar Al-Saadi said that the floating of the Iraqi dinar is a big mistake during this period, because that will greatly harm the poor and those with limited income.

He added in an interview followed by "Al-Eqtisad News", that "the financial crisis in Iraq is the result of economic problems and mistakes that have spanned from 40 years until now."

The dialogue came as follows:

Do you think that the Iraqi financial crisis is very dangerous and will cause social problems if it continues?

The current crisis is the result of economic problems and mistakes that spanned from 40 years until now. Iraq, since 1980, has been suffering from a decline in the economic chart due to the use of the economy to serve the authorities and not to serve the public interest. This has led to the depletion of its financial resources in the purchase of weapons, economic sanctions, and debt repayment, etc.

Therefore, the current situation is not a new thing because the Iraqi economy, with any drop in oil prices, puts the government in front of a difficult test in the possibility of securing the salaries of employees and retirees, the fact that the financial crisis still exists without any government solutions, as the economy now lives on a single source of income In a commodity being manipulated by huge waves in international markets.

As for social problems, the procedures of successive governments have left the fever of deprivation and social injustice due to the failure to realize the importance of managing the economy according to sound scientific and objective patterns.

Caused a large social gap in the absence of the middle class and the creation of a large generation of the unemployed who are difficult to contain in the aging public sector which suffers from great slackness. In Iraq annually more than 100 thousand people enter the labor market. The government is now unable to contain a quarter of this number. If there are no radical and quick solutions to remedy the situation, Iraq is on the verge of a serious societal and economic collapse.

What do you think of the reform paper that the Finance Minister started working on?

Frankly, until now, I have not seen the terms of the (white paper) as it was released because it is not yet clearly announced and has not been approved by the House of Representatives yet, but I expect it will be in accordance with the conditions of the World Bank, which always emphasizes reducing salaries, expenditures and public waste. According to the words of the Minister of Finance, that the white paper will be implemented over a period of three years to reform the financial and economic situation in the country, and that the paper also includes reform points that will be implemented in the long term, and other reform materials that must be applied in the licensing rounds, and the oil agreement with OPEC, given that the global economic situation has I differ from the previous one, but until now this is all talk, and I do not know how serious it is in applying it in light of these internal political conflicts and divisions.

Do you think that the Kurdistan region will abide by the economic agreement on oil and financial revenues?

The problems between Baghdad and Erbil have been for many years, on top of which are the file of managing oil wealth and dividing its revenues, and the disputed areas between the two sides. But last month, a high-ranking delegation from the Kurdistan region arrived in Baghdad to resume discussions with the federal government on the outstanding differences, especially the oil and financial revenues files. And that the agreement centered mostly on the delivery of crude oil to the region in exchange for sending Baghdad its share of the federal financial budget. So I think this time the negotiations will be positive regarding the economic commitment, as the Kurdistan region has emerged as a major supporter for Al-Kazemi's assumption of the leadership of the Iraqi government, which may contribute to bridging the gaps between Baghdad and Erbil, and create the atmosphere for reaching agreements, which confirms the success of the recent Sinjar agreement between the two parties and the return Displaced people to their homes.

Why is Iraq unable to activate its industry and are there countries that stand in the way?

It has become clear today to all Iraqis that the FILE OF INDUSTRY IN IRAQ IS MORE POLITICAL THAN ECONOMIC, MEANING THE PROBLEM IS NOT IN THE LACK OF MATERIAL OR HUMAN RESOURCES, BUT THERE ARE POLITICAL PROBLEMS and interventions from regional countries standing in front of the wheel of industrial sector development, because Iraq was one of the most prominent countries in the region. Which relied on the food industry, such as dairy products, vegetable oil industry, etc., to achieve its self-sufficiency. Today, the factories of these industries suffer from low production and poor quality when compared to the importer, such as the Iranian and Turkish, who largely filled the local markets, as the volume of imports for these products amounts to billions of dollars annually.

In addition to that, there are also other reasons, including financial corruption in the ministries, weakening industrial production, random importation and the absence of control over product and quality. And also not to shed light in support of industrial professions and crafts, in addition to the low wages for workers in this sector, and do not forget also the wars that the Iraqi street witnessed were responsible for closing the largest factories.

Do you support floating the dinar during the current stage?

THE DEMAND TO FLOAT THE DINAR IS A BIG MISTAKE, BECAUSE THE POOR WILL PAY THE PRICE. It is not in the interest of the Iraqi financial system to raise the exchange rate of the dollar, because IT WILL LEAD TO A DECREASE IN THE PRICE OF THE IRAQI DINAR AND A DECREASE IN PURCHASING POWER AND WILL LEAD TO INFLATION, and that the classes with limited income and salaries will be the first affected by this decision.

In a simple arithmetic process, if $ 100 = 120,000 dinars after the float, it will be = 150,000 dinars at the very least, and therefore if your salary is 600,000 dinars, its real value is 400,000 dinars. Obtaining it or the habit of buying it here leads to a significant increase in inflation, with the rest of the current problems such as facing Corona, unemployment, poor services, security challenges, and debts all lead to a complete economic collapse.

Is corruption or mismanagement behind the failure to end the electricity crisis?

The two are with some corruption and mismanagement, as with every summer crisis in the electricity sector, government promises are poured in and pledges to improve conditions in the following summer. However, what actually happens is the addition of some prosthetic solutions that the Iraqis do not see a trace of, and this confirms that what Iraq is actually suffering is not A shortage of electric power generation, but rather financial and administrative corruption.

Because financial corruption is linked in contracts to the money spent on the electricity sector, commissions, and others, as for administrative corruption in its simplest form, which is that many general managers, technicians and engineers in the ministry are still in office throughout these years despite the great failure in the electricity sector and that the sums spent On this sector (of maintenance and installation of stations) is estimated at 35 billion dollars, in addition to another 30 billion dollars in operational expenditures. These figures are equivalent to the budgets of neighboring countries for two years, such as Jordan and Lebanon.

What is your interpretation of the phenomenon of the presence of millions of employees in the public sector?

Indeed, I could not find an explanation for the phenomenon of mobilizing millions of employees in the public sector, which is sterile and unproductive. Despite the throats of researchers and specialists on this issue, and there was no response until the situation arrived now. There are more than 6 million and half employees with retirees who receive salaries from the state treasury and consume 65% of the budget.

 Everyone in this topic is talking about activating the partnership with the private sector, but the issue cannot be solved in this way only, but rather by creating effective economic policies and procedural means to address the problems and needs of society by opening new scientific departments that are compatible with the modern labor market and providing a suitable environment for investment, and most importantly, stability In laws and legislation, and providing security and protection for capital owners.

Why does the state not pay attention to the private sector and its workers by activating social security for them?

There are attempts by some MPs to activate the Social Security Law, but so far nothing has been issued, and the reason behind this is the parties' struggle among themselves to obtain personal gains more than interest in the public interest. These differences reflected negatively on all the joints of the Iraqi economy, despite the fact that the Social Security Law is very important, because it will ensure the employment of a large segment of the unemployed. It will also guarantee workers in the private sector the pension salary, which will banish the ghost of appointments that has become the dream of all young people in the government sector.

Economically, how would you describe the Iraqi-Kuwaiti relations?

Iraq and Kuwait have a historical opportunity to form very large economic relations in the region due to the presence of many common ties between the two peoples, including affinity, language, nationalism, religion, kinship and borders … and so on, but unfortunately this relationship was not at the level of these ties, and for old and well-known political reasons and unfortunately also the governments could not Iraq after 2003 correcting the course of this relationship, although there was a good step by the government of Kuwait in the conference in support of the Iraqi economy, but soon this relationship worsened due to Kuwait’s role in disrupting work in the port of Faw to support Port Mubarak to be the most dominant of international trade in Region. Therefore, it is very necessary that there be negotiations from the two countries to strengthen the bonds of the economic relationship and achieve the possible benefit for both parties.

(Mnt Goat – So another economist talking about floating the dinar. Why is this economist talking about it, it must have been proposed already as part of the solution to the economic problems? But he is not in favor of it, but remember this is an economist and not the CBI.

Oh - this economist is wrong as the new Governor of the Central Bank, Mustafa Ghaleb Makhaif, has spoken out and has outlined his plan for financial reform. See his interview in the below article entitled “THE CENTRAL BANK TALKS ABOUT ITS VISION TO REFORM THE REALITY OF THE IRAQI BANKING SECTOR”. Please scroll down and read it.)

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INDICATORS OF THE DOLLAR WAR AGAINST THE IRAQI DINAR … THE “LATENT” FOREIGN CURRENCY RESERVE IS A GOOD NUMBER

October 18, 2020 Walter

Yes Iraq – Baghdad

The Economic Advisor to the Prime Minister Mazhar Muhammad Salih confirmed that the intervention of the Rafidain Bank in the activities of buying and selling could provide stability in the exchange market.

Saleh said, in statements monitored by “Yass Iraq”: The development of windows for selling the dollar through the first governmental commercial bank, that is, the Rafidain Bank, is the embodiment of the money market operations that the bank practices to buy and sell dollars with its customers from banking companies on behalf of the monetary authority.

Saleh added that: This matter is a new direction to develop the operations of the (wholesale) money market for foreign currency. The intervention of Al-Rafidain in the activities of buying and selling may provide stability in the exchange market, but depends on meeting the new window for the total foreign money demand (from outside the remittance market) because it is feeding Demand by way of remittances is still one of the tasks of the window of sale and purchase of foreign currency for the Central Bank of Iraq, which constitutes more than 90% of the need for foreign exchange in order to finance foreign trade for the private sector.

He explained: There is a correlation in the formation of the exchange rate and its movements in the secondary market between the remittance market and the dollar cash market. The latter market is highly correlated and highly sensitive to the information market and is affected by it quickly, so the dollar cash market is one of the most sensitive markets in driving the price in the parallel market for exchange, but it is encouraging at the same time to form an effective and highly flexible offer from outside the Rafidain monetary window.

And Saleh continued that:

By virtue of the current monetary behavior of individuals in the local economy that is semi-dollarized and the composition of the demand for foreign currency, which is based on the hoard of individuals in foreign currency or their bank deposits in the same foreign currency, we find that there is a foreign reserve (latent) and prepared for effective supply in the cash dollar market estimated by Some, in total, about not less than 7-10 billion dollars, which are saturated sums that are kept with individuals, most of them outside the local banking system, and are sometimes used in settling large internal transactions such as dealing with real estate, land, transport, gold, and others.

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IRAQ’S CENTRAL BANK IS AT RISK OF LOSING ITS INDEPENDENCE OUT OF KURDISH NEWS

Finance Minister Ali Allawi said in a press conference following the adoption of the White Paper for Economic Reform by the Council of Ministers on October 13, "we have a solid and strong relationship with the Central Bank for the purpose of unifying monetary and financial policies, and this will provide us with the possibility to cover all the requirements and entitlements of the salaries of employees and retirees." This statement went unnoticed by all journalists, pundits and analysts. Nobody noticed the attempt of the Iraqi government to undermine the independence of the Central Bank of Iraq (CBI) to implement the financial policies approved by the government.

The objectives of the government are clear. The Central Bank has become "very cooperative" with the government's financial policy. The Bank’s law contradicts such cooperation in order to safeguard and preserve the strength of the Iraqi economy on the one hand, and not to bear any government failure in managing the financial policy on the other hand. This is a context known to successive governments, and because the central bank adopts monetary policies that are independent of the government's financial policies. We all remember the dispute that arose between the government of Nuri al-Maliki and the governor of the Central Bank, Sinan al-Shabibi, in 2012, with the former ending up accusing the latter of corruption and issuing judicial orders for his arrest while he was in the Japanese capital Tokyo on an official visit. Subsequently he was put on trial in absentia and sentenced to seven years in prison in 2014 and removed from his post.

The Role of CBI

The CBI is an institution financially and administratively independent from the government according to Article 103 of the Iraqi constitution. It is responsible for setting monetary policy, issuing and managing the national currency and foreign reserves, and setting up regulations, procedures and controls for the work of local banks in the country and monitoring and auditing their work. It is the official body that represents Iraq in the international financial and monetary institutions such as the International Monetary Fund, the World Bank, and others. Among its tasks is also determining the supply and demand for money by setting interest rates. CBI is also responsible for receiving deposits from oil sales and keeping the state’s cash reserves, and it maintains the value of the national currency. This means that the independence of the CBI from government financial policies is very important to preserve the public funds deposited within the bank.

What the Minister of Finance announced in his aforementioned statement is a dangerous precedent for inserting the CBI into the core of the government's financial policy, and making it a tool to implement this policy. This was clearly demonstrated by what was included in the White Paper of financing the budget deficit and considering CBI reserves as the only source to fill the deficit, and here lies the real danger.

THE WHITE PAPER ON PAGE 37 REFERRED TO THE DANGER OF USING THE CBI AS A SOURCE OF FINANCING, they believe it "will lead to severe pressure on the CBI’s reserves and the resulting unsustainable future consequences." This view was further confirmed by the group of experts writing the White Paper on page 42, stating that "indirect monetary financing by the CBI is the only remaining source... The need for this reserve to finance imports of goods and services means its will drop dangerously to low levels within nine months, which will ultimately lead to a real crisis in value of the Iraqi dinar, accompanied by the possibility of a collapse in its value."

It is worth mentioning that the CBI reserves are under threat from three different sources:

First: Using the CBI reserves to finance the government's fiscal deficit. This is done in two ways, the first is to "buy goods and services" using hard currency, and the second way is by “indirect borrowing” using the central bank to devalue the dinar against the dollar in order to "pay the monthly benefits from salaries."

Second: The continuation of the NOTORIOUS CURRENCY AUCTION, which is A RESERVOIR OF CORRUPTION AND A SOURCE OF WEALTH FOR INFLUENTIAL PEOPLE IN THE WORLD OF POLITICS, MONEY AND BUSINESS. The sale of hard currency in the auction exceeds state revenues in most cases, and this means withdrawal from the Bank reserves and further reducing its levels.

Third: The increasing pressure from the state’s creditors, especially Iran, to finance its economy with hard currency after the US administration listed 18 Iranian banks under sanctions on October 8. Therefore, the CBI and Iraqi banks became the only outlet for Iran for hard currency. The visit of the Governor of the Central Bank of Iran to Iraq on October 12 was for this purpose.

The Central Bank governors kept quiet regarding the government statement to clarify its position. WE ALSO DID NOT HEAR FROM THE NEW GOVERNOR. WHAT IS HIS VISION FOR MANAGING THE BANK’S AFFAIRS? WHAT IS HIS MONETARY POLICY? HOW CAN HE PRESERVE THE CASH RESERVE? Amid the worsening current economic crisis, it is imperative for the new governor to clarify to the Iraqi people the Central Bank’s policies and its position on the crisis facing the country.

The easiest of solutions is not a solution

According to informed sources, the team of experts is still busy working on the White Paper and adding details and appendices to the road map. The team pointed out the DANGER OF BORROWING FROM THE CBI, OR USING DEVALUATION AS A MEANS TO MATCH THE PUBLIC BUDGET DEFICIT. They warned that this "will later lead to an increase in the cost of living, and thus reduce the ability of the majority of individuals to meet their requirements, as the country depends entirely on imports to meet consumption." It is clear that the majority of the people will suffer and pay the price as a result of this shift in the adopted fiscal policy.

A financial expert, who did not want to reveal his identity, confirms that "THE SHORTEST AND EASIEST SOLUTION IS TO RESORT TO THE CBI RESERVES AND MOVE TOWARDS PRINTING THE DINAR, BUT TAKING THIS PATH IS NOT A SOLUTION, RATHER IT IS SUICIDE." The real fear is that the government and political leadership will resort to this solution instead of starting real radical reforms, which require executive decisions issued by the government and other legislatively supported decisions by Parliament.

The national duty here makes it imperative for all political forces and all their leaders not to stand idly by. They must actively participate in adopting practical, even if difficult, solutions that the government team will present through the White Paper and its annexes, in addition to what is presented by other experts outside this team from Parliament, economic research centers and monetary policy experts.

KEEPING THE DOORS OF CORRUPTION WIDE OPEN IN MOST STATE INSTITUTIONS, RELUCTANCE TO CURB THE CORRUPTION OF THE RULING PARTIES THEMSELVES, and not abolishing their economic offices to limit their control over ministries, institutions and vital sectors, will ensure the continued exacerbation of crises and runs risks to the current financial situation, leading the way to a real collapse in a time frame of a few months. The financial and economic collapse will be followed by the collapse of the state of Iraq, and then chaos will prevail. At that juncture no one will be able to restore and control the situation again, EXCEPT BY A MIRACLE THAT WILL BE DIFFICULT TO COME BY.

Iraq is multi-cultural, multi-factional society with different loyalties, each supported by armed groups. Chaos will mean loss of control and stability, which is difficult to sustain in normal circumstances, let alone in the circumstances of bankruptcy, political strife, scarcity of resources and the loss of people's livelihood.

IRAQ IS STARING AT ITS LAST OPPORTUNITY, AND THE POLITICAL PARTIES MUST TAKE IT WITHOUT FAIL, be brave and make courageous and responsible decisions to remedy the situation, otherwise they will be witnessing the worst possible catastrophic scenarios we have ever seen.

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

THE CENTRAL BANK TALKS ABOUT ITS VISION TO REFORM THE REALITY OF THE IRAQI BANKING SECTOR

Baghdad – The Central Bank of Iraq discussed the means to include a vision for reforming the reality of the banking sector in the country.

The Governor of the Bank, Mustafa Ghaleb Makhaif, said in an interview with the official newspaper followed by “Nass”, (October 15, 2020) that “the future vision for the work of the Central Bank of Iraq is centered in light of the economic crisis through the goals it seeks to achieve and specified under its Law No. (56) Of the revised year 2004, the most important of which is (ensuring the stability of domestic prices and strengthening a stable financial system based on competition), to continue achieving the strategic objectives set out in the plan (2016-2020).

In order to do this, the governor explained, “The bank recently presented the terms of the reform paper for the banking sector, which has been initiated now, because of its importance in developing banking services and products in the next stage, and through it the banking sector will be supported to advance its current reality, and a group of The specific criteria adopted by the bank and on the basis of which the operating banks have been classified, “indicating that” this classification will be reviewed by the end of this year, and this will continue for the seasons of the following year. ”

“This step comes within the framework of strengthening confidence in the banking sector and improving the quality of services provided to the public, as well as enhancing competitiveness in the Iraqi banking sector,” Mkhaif stressed, reiterating the previous central bank’s confirmation in the request to banks that are lagging more than once to work to correct their situation and pay dues. Her customers. ”

The governor of the Central Bank stressed that “this classification will be an opportunity for those banks to prove their seriousness in achieving the requirements of reform and to pay the dues of depositors and shareholders owed by those banks

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

THE CENTRAL BANK BEGINS IMPLEMENTING STEPS TO REFORM THE BANKING SECTOR

Today the Central Bank of Iraq began implementing its first reform steps for the banking sector, as it finished classifying private commercial and Islamic banks operating in Iraq according to a set of international standards as well as a number of standards approved by this bank.

This step comes within the framework of enhancing confidence in the banking sector, improving the quality of services provided to the public, as well as enhancing competitiveness in the Iraqi banking sector.

This bank confirms that it has previously asked the lagging banks more than once to work on correcting their situation and paying their customers’ dues, and therefore this classification will be an opportunity for those banks to prove their seriousness in achieving the requirements of reform and pay the dues of depositors and shareholders.

Finally, we announce that the next stage will include the process of “reforming government banks as well,” noting that the reform measures that have been adopted depend mainly on the Central Bank Law No. (56) of 2004 and the Iraqi Banking Law No. 94 of 2004 and the instructions and controls issued according to them.

(Mnt Goat – the article says NOTHING about the project to delete the zeros)

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

AN ECONOMIST REVEALS THE TERMS OF THE REFORM PAPER THAT THE MINISTRY OF FINANCE IS WORKING ON

Today, professor of economics at Basra University, Nabil Al-Marsoumi, revealed some items of the economic reform paper called (the White Paper) that the Ministry of Finance is working on to reform the Iraqi economy.

Al-Marsoumi said, in a post on Facebook, which Al-Rasheed followed him, “As I expected in previous publications that the government reform paper will not deviate from the IMF policies and austerity measures with high social costs.”

He added, “This can be seen by looking at some of what was mentioned in the reform paper that the government called white, as follows:

1-Reducing the wage and salary bill from 25% of GDP to 12.5% within three years.

2-Reforming the retirement fund so that it is not linked to the budget, and retirement salaries are paid directly from the fund.

3- Reducing financial support for state-owned companies by 30% every year for a period of three years.

4- Reducing total government support from 13% of GDP to 5% within three years.

5- Restructuring the public salary scale by stopping new employment and replacement operations in the public sector.

6- Setting a higher ceiling for employees ’salaries to achieve justice and reduce differences.

7- Applying income tax to employee allowances, incentives, bonuses, and others.

8- Reviewing fuel subsidies for state-owned oil companies. The proceeds from the sale of black oil should be returned to the state treasury.

9- Issuing national bonds and instruments and offering them for public circulation on the Iraq Stock Exchange.

10- STUDYING THE CURRENT EXCHANGE RATE OF THE DOLLAR AGAINST THE DINAR AND TAKING INTO CONSIDERATION THE REQUIREMENTS OF FINANCIAL AND MONETARY STABILITY AND ACHIEVING THE COMPETITIVENESS OF THE IRAQI ECONOMY.

11- Restructuring the state-owned public companies and converting them into private companies.

12- Correcting the defect in the ration card system to ensure the protection of people with limited income and withholding it from families whose income exceeds a certain ceiling.

13- Ensure that all workers in the public, private, mixed and cooperative sectors are included in retirement benefits.

14- Completing the Social Insurance Law in order to be a substitute for the unified retirement, retirement and social security laws for workers

(Mnt Goat – Just in case you noticed too there is nothing specific about the “project to delete the zeros” included in the White Papers. WE can only guess why all these gurus keep telling you the RV is here. )

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

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 is working in the battle against the corruption of Iran in Iraq, the corruption of the democrat party in the USA and the corruption of the labor party in the UK. Yes, your prayers ARE WORKING. God has guided these patriotic men and women on this new battle field. It is a battle for the mind filled with propaganda and lies. He has guided the honest, patriots of Iraq, the USA and the UK to fight for their homeland.

So, this new war now on our citizens is underway. 3 corrupt countries, 3 heroic men and 3 miracles. God’s Hand At Work!

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. It is a battle against this crooked idealism of globalization and a One World Government of enslavement.

We must keep praying for the end to the rapid corruption and enslavement of people. 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. That they may listen to the Holy Spirit for guidance in fighting this war on us. 

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 or politics 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” 

P.S. (Please if you can – say the rosary every day. You can do it while you take your daily run or walk. You can do while you lie in bed in the morning or nighttime before sleep. You don’t even need a set of rosary beads as you can use your ten fingers ...lol..lol..lol… )

Auf Wiedersehen

Much love to ya all,

Mnt Goat
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