Thread: Iraqi/Dinar news until March 1st, 2007

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Originally Posted by Hope Full

Question If the Budget is somewhat based on 1260 why didn't/haven't they moved the exchange rate to 1260 after ratifing and implemting the budget?
I understand they pulled it out of thin air but they have been very set on 1260 so why are we still seeing 1282?? and not 1260?? if it's only a number. I read the articale posted the other day stating the phone companies and market stores didn't know what to charge why not just move it to this non-magical number 1260 and lose all the confusion????
Thanks

Maybe because the 1282 is still close enough to the dollar/Euro pairing ($1.28)
that the CBI does not want to go higher as they are just waiting for GOI to complete HCL and announce? Perhaps being so close to an RV at this time all confusion will be lost anyway when real rate is known hopefully in a few days?
JMHO

Iraq Cabinet Backs Oil Proposal

By HASSAN HAFIDH in Amman, Jordan, and CHIP CUMMINS in London
February 26, 2007 9:37 p.m.

Iraq's cabinet approved a draft law laying the groundwork for oil-field development contracts, a move that eventually could lift its battered economy and help allay the country's sectarian divisions.
The legislation now goes to parliament. If the law is approved, it would green-light negotiations between central-government and regional officials and foreign oil-company executives, though oil companies aren't likely to rush into the country anytime soon.
FIGHT FOR IRAQ

See continuing coverage of developments in Iraq, including an interactive map of day-to-day events in Iraq and a tally of military deaths.

The legislation would provide foreign executives with a legal foundation for any oil-field development contracts they may one day sign with government officials. The lack of such a framework after Saddam Hussein's ouster in 2003 has prevented most oil companies from entering into detailed negotiations.
Typically, in countries with nationalized oil industries, foreign oil companies negotiate a contract with the government itself. That was the case in Iraq before Mr. Hussein's fall. The new law would clear the way for oil companies to negotiate with Iraq's current central government, along with the regional authorities.
Iraq is home to some of the world's largest crude-oil deposits, and much of the country remains relatively unexplored. Decades of war and underinvestment have left the oil industry in shambles. U.S. officials have long encouraged Iraqi counterparts to hammer out a petroleum law in the hopes of encouraging foreign investment and jump starting Iraq's economy.
A petroleum law could also provide some relief from the political fighting by holding out the promise of new revenue streams.

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Just some quick math and an example of why they must revalue the dinar...

Lets assume that Iraq has 15 Trillion dinar in circulation

15,000,000,000,000
divided by
1282

at the current rate that comes to approximately $11,700,468,018 USDs

now if we divide 11.7 billion by the number of Iraqis, 26 million, we will find that there is enough currency at the current rate for each person to have about $450.00 USD.

This does not take into account the dinar removed from circulation through the auctions or the dinar needed for Government expenditures.

That 11.7 trill by at least 5 trill taken out = roughly 6.7 trill. Pretty slim if you ask me.

Originally Posted by neno

That 11.7 trill by at least 5 trill taken out = roughly 6.7 trill. Pretty slim if you ask me.

I'll go with your numbers... That leaves about $201.00 per person!

Originally Posted by PAn8tv

Dollars to dinars: We did get the money to Iraq
John B. Taylor

Monday, February 26, 2007
STANFORD, California: Earlier this month, the House Committee on Oversight and Government Reform held a hearing that criticized the decision to ship American currency into Iraq just after Saddam Hussein's government fell.

As the committee's chairman, Henry Waxman of California, put it in his opening statement, "Who in their right mind would send 360 tons of cash into a war zone?" That attracted wide attention, feeding antiwar sentiment and providing material for comedians.

A careful investigation of the facts behind the currency shipment paints a far different picture.

The currency that was shipped into Iraq in the days after the fall of Saddam Hussein's government was part of a successful financial operation that had been carefully planned months before the invasion.

Its aims were to prevent a financial collapse in Iraq, put the financial system on a firm footing and pave the way for a new Iraqi currency.

Contrary to the criticism that such currency shipments were ill-advised or poorly-monitored , this financial plan was carried out with precision and was a complete success.

The plan, which had two stages, was designed to work for Iraq's cash economy, in which checks or electronic funds transfers were virtually unknown and shipments of tons of cash were commonplace.

In the first stage, the United States would pay Iraqi government employees and pensioners in U.S. dollars. These were obtained from Saddam's accounts in American banks, which were frozen after he attacked Kuwait in 1990 and amounted to about $1.7 billion. The second stage was to print a new Iraqi currency for which Iraqis could exchange their old dinars.

The final details of the plan were reviewed President George W. Bush and the National Security Council on March 12, 2003. I attended that meeting.

President Bush approved the plan with the understanding that we would review the options for a new Iraqi currency later, when we knew the situation on the ground.

To carry out the first stage of the plan, President Bush issued an executive order on March 20, 2003, instructing United States banks to relinquish Saddam's frozen dollars. From that money, 237.3 tons in $1, $5, $10 and $20 bills were sent to Iraq.

During April, U.S. Treasury officials in Baghdad worked with the military and the Iraqi Finance Ministry officials — who had painstakingly kept the payroll records despite the looting of the ministry — to make sure the right people were paid.

The Iraqis supplied extensive documentation of each recipient of a pension or paycheck. Treasury officials who watched over the payment process in Baghdad in those first few weeks reported a culture of good record keeping.

On April 29, Jay Garner, the retired lieutenant general who headed the reconstruction effort in Iraq at the time, reported to Washington that the payments had lifted the mood of people in Baghdad during those first few confusing days. Even more important, a collapse of the financial system was avoided.

This success paved the way for the second stage of the plan. In only a few months, 27 planeloads (747 jumbo jets) of new Iraqi currency were flown into Iraq from seven printing plants around the world. Armed convoys delivered the currency to 240 sites around the country, from where it was distributed to 25 million Iraqis in exchange for their old dinars, which were then dyed, collected into trucks, shipped to incinerators and burned or simply buried.

The new currency proved to be very popular. It provided a sound underpinning for the financial system and remains strong, appreciating against the dollar even in the past few months. Hence, the second part of the currency plan was also a success.

The story of the currency plan is one of several that involved large sums of cash. For example, just before the war, Saddam Hussein stole $1 billion from the Iraqi central bank. American soldiers found that money in his palaces and shipped it to a base in Kuwait, where the U.S. Army's 336th Finance Command kept it safe. To avoid any appearance of wrongdoing, American soldiers in Kuwait wore pocket-less shorts and T-shirts whenever they counted the money.

Later, American forces used the found cash to build schools and hospitals, and to repair roads and bridges. General David Petraeus has described these projects as more successful than the broader reconstruction effort.

But that wasn't the only source of dollars. Because the new Iraqi dinar was so popular, the central bank bought billions of U.S. dollars to keep it from appreciating too much. As a result, billions in cash accumulated in the vaults of the central bank. Later, with American help, the Iraqi central bank deposited these billions at the New York Federal Reserve Bank, where they could earn interest. (HMMM, wonder how much they have made in interest, since 2004???)

Finally, when Iraq started to earn dollars selling oil, the United States transferred the cash revenue to the Finance Ministry, where it was used to finance government operations, including salaries and reconstruction.

Many of these transfers occurred in 2004, long after the financial stabilization operation had concluded. Iraqi Finance Ministry officials had already demonstrated that they were serious about keeping the controls they had in place. The 360 tons mentioned by Henry Waxman includes these transfers as well as the 237.2 tons shipped in 2003 in the stabilization.

One of the most successful and carefully planned operations of the war has been held up in this hearing for criticism and even ridicule.

As these facts show, praise rather than ridicule is appropriate: praise for the brave experts in the U.S. Treasury who went to Iraq in April 2003 and established a working Finance Ministry and central bank, praise for the Iraqis in the Finance Ministry who carefully preserved payment records in the face of looting, praise for the American soldiers in the 336th Finance Command who safely kept found money, and yes, even praise for planning and follow-through back in the United States.

Me thinks none of us know where the queen is in this game of Three-card Monte!!!


Three-card Monte - Wikipedia, the free encyclopedia

Originally Posted by TerryTate

Me thinks none of us know where the queen is in this game of Three-card Monte!!!


Three-card Monte - Wikipedia, the free encyclopedia

i agree with you on that one sir

also-- " Because the new Iraqi dinar was so popular, the central bank bought billions of U.S. dollars to keep it from appreciating too much ".
With dinars ? Any guess on how many trillions the US treasury holds ?

When I look at some of the translated news, calling it gibberish might perhaps denigrate the word 'gibberish'. Bearing that in mind, would it be a stretch to consider that the 'May' that was cited could actually be 'Mar'? That would certainly dovetail with much of the other information that's out there right now. May is 'no fit'; Mar is a 'fit'.