Thread: Welcome, Jeffrey Frankel. A Crude Peg for the Iraqi Dinar.

I have sent Mr Frankel a request to visit the forum.

Dear Mr. Frankel,



I am doing research on Iraq and the countries currency (the Iraqi dinar).

The reason for my email is your OP-ED "A Crude Peg for the Iraqi Dinar" published in the Financial Times June 13, 2003

I will try to make this email as brief as possible and would greatly appreciate and thank you in advance as I anticipate your reply.

My questions to you are,

Do you still hold the same opinion for a peg on the Iraqi Dinar as you did in 2003, that being one-third of a dollar plus one-third of a euro, plus one-hundredth of a barrel of oil?

Do you feel with the amount of Dinar stated to be in circulation (15-20 Trillion) that a peg such as the one you suggest is possible?

Would you consider the Iraqi Dinar (currency) a good investment?

I am a member of an Iraqi Dinar investors forum and would like to invite you to visit http://www.rolclub.com/iraqi-dinar-dinartrade-com/ where the Dinar as well as your editorial is discussed, I would also like to invite you to a future conference call where your opinion on Iraq's peg will be the topic. This conference call will afford you the opportunity to pitch any material you have authored to the participants on the call and with your participation we would expect a very large audience. If you are willing to participate in the call we can coordinate a future date and time that will fit your schedule.



Sincerely,

Amazing!!

A reply from Mr. Frankel in record time. If you happen to visit here Mr Frankel, thank you. I will edit my above post to remove your email address to avoid what you stated in closing.

Mr. XXX,

Here are my answers to your questions:

**********

Q: Do you still hold the same opinion for a peg on the Iraqi Dinar as
you
did in 2003, that being one-third of a dollar plus one-third of a
euro,
plus one-hundredth of a barrel of oil?
A: I still stand by my proposal. But, it was never meant to be a
statement about the proper level at which the Dinar would be converted
to
the 3-component basket standard. I just meant that it should be tied
to a
basket that consisted of dollars, euros and oil in those relative
proportions. Bt the dinar should go into the basket at whatever the
current levels are. In any case, the odds that this proposal will be
adopted by the authorities are even lower now than when I made it.
Q: Do you feel with the amount of Dinar stated to be in circulation
(15-20
Trillion) that a peg such as the one you suggest is possible?
A: Given my answer to the first question, the advisability of the
proposal
is not affected by the amount of money that has been created in the
meantime (assuming that this money supply is by now fully reflected in
current exchange rates and prices of goods).
Q: Would you consider the Iraqi Dinar (currency) a good investment?
A: No. This is not a suitable investment for most individual
non-Iraqi
citizens, in large part because it is not a convertible currency traded
in
liquid international markets. (Also because the prospects for the
Iraqi
government do not look great to me, but many of your readers can judge
that
for themselves.)**********
Feel free to post my answers on your website. I don't want to
participate
directly myself, because I already get a lot more email on this subject
than I want.

Originally Posted by Inscrutable

Amazing!!

A reply from Mr. Frankel in record time. If you happen to visit here Mr Frankel, thank you. I will edit my above post to remove your email address to avoid what you stated in closing.

Mr. XXX,

Here are my answers to your questions:

**********

Q: Do you still hold the same opinion for a peg on the Iraqi Dinar as
you
did in 2003, that being one-third of a dollar plus one-third of a
euro,
plus one-hundredth of a barrel of oil?
A: I still stand by my proposal. But, it was never meant to be a
statement about the proper level at which the Dinar would be converted
to
the 3-component basket standard. I just meant that it should be tied
to a
basket that consisted of dollars, euros and oil in those relative
proportions. Bt the dinar should go into the basket at whatever the
current levels are. In any case, the odds that this proposal will be
adopted by the authorities are even lower now than when I made it.
Q: Do you feel with the amount of Dinar stated to be in circulation
(15-20
Trillion) that a peg such as the one you suggest is possible?
A: Given my answer to the first question, the advisability of the
proposal
is not affected by the amount of money that has been created in the
meantime (assuming that this money supply is by now fully reflected in
current exchange rates and prices of goods).
Q: Would you consider the Iraqi Dinar (currency) a good investment?
A: No. This is not a suitable investment for most individual
non-Iraqi
citizens, in large part because it is not a convertible currency traded
in
liquid international markets. (Also because the prospects for the
Iraqi
government do not look great to me, but many of your readers can judge
that
for themselves.)**********
Feel free to post my answers on your website. I don't want to
participate
directly myself, because I already get a lot more email on this subject
than I want.

One can't say how valuable a post like this is in this forum. You have capped a multiude of answers to questions people may have from this forum. In the future, I would hope to see more from Mr Frankel and yourself regarding this. We went into this with our eyes wide open, now you have turned on the light for all to see. Thank you Inscrutable!!!

T

BTW...this is the area that most concerns me.

Originally Posted by Lunar

Inscrutable
Once again you have gone out of your way to obtain and share valuable information....thanx.

No problem, be sure to sign up for my conference call scheduled for 2009. my guest will be Homer and Marge.

Originally Posted by notazbad2000

One can't say how valuable a post like this is in this forum. You have capped a multiude of answers to questions people may have from this forum. In the future, I would hope to see more from Mr Frankel and yourself regarding this. We went into this with our eyes wide open, now you have turned on the light for all to see. Thank you Inscrutable!!!

T

Hi Inscrutable,

For those of us (newbie investors) who are still 'opening our eyes' can you provide a brief explanation of who this person is? From what I see in your email, he has nothing but derogatory statements about the dinar. Has this always been his attitude toward it, and if so, why would you want him to visit our forum? Is he saying that this many of us are wrong in our beliefs of this investment (it sure seems to be his view)? Is this person someone we should be concerned with and prepare to abandon this ship? What is your take on his comments, or were these the comments you were expecting to receive?

I am just trying to grasp this and (I guess) assure myself that we (my family) have not jumped aboard a sinking ship. I know all the news coming out the last few days/weeks does seem to be positive, but I am also seeing where some things are, in a manner of speaking, rocking the boat like a storm surge in the middle of the ocean.

Any 'life jacket' that is not emblazened with TITANIC would be greatly appreciated. I just don't know sometimes what to make of all this 'back and forth' info...

Patty

Is this guy God's assistant that his opinion is so valued? Wassup with this?

Sure, here you go. Kinda defetes the purpose of me removing his email address but since he's listed at Harvard publicly I don't see a problem.

Jeffrey Frankel's Profile at Harvard University

A Crude Peg for the Iraqi Dinar: Jeffrey Frankel

Originally Posted by davzgirl

Hi Inscrutable,

For those of us (newbie investors) who are still 'opening our eyes' can you provide a brief explanation of who this person is? From what I see in your email, he has nothing but derogatory statements about the dinar. Has this always been his attitude toward it, and if so, why would you want him to visit our forum? Is he saying that this many of us are wrong in our beliefs of this investment (it sure seems to be his view)? Is this person someone we should be concerned with and prepare to abandon this ship? What is your take on his comments, or were these the comments you were expecting to receive?

I am just trying to grasp this and (I guess) assure myself that we (my family) have not jumped aboard a sinking ship. I know all the news coming out the last few days/weeks does seem to be positive, but I am also seeing where some things are, in a manner of speaking, rocking the boat like a storm surge in the middle of the ocean.

Any 'life jacket' that is not emblazened with TITANIC would be greatly appreciated. I just don't know sometimes what to make of all this 'back and forth' info...

Patty

He states that the NID/IQD is a bad investment. Cause it's not on the International markets? Well DA, what do dose he think we are waiting for? This is why we are holding hard currency! We chose to get in before paper contracts are traded. For this IMHO we will be handsomely rewarded!!!!!!!!!!!!

Originally Posted by Inscrutable

No problem, be sure to sign up for my conference call scheduled for 2009. my guest will be Homer and Marge.

Think I'll pass...everyone knows these conference calls are BS

To fix the dinar simply to oil alone may be too radical a proposal. While it would facilitate the recovery and expansion of the oil sector, it might at the same time discourage production of other internationally tradeable goods by shifting the entire burden of price uncertainty on to them. My proposal for Iraq, therefore, is to add oil to the basket of currencies to which the dinar is pegged. For simplicity, give equal weight to all three units. Or, what is almost equivalent, define the value of the dinar as one-third of a dollar plus one-third of a euro, plus one-hundredth of a barrel of oil.

Ok now with that above. Just for instance lets say that the Value of the Iraqi Dinar comes in at 1:1 and I have 1 dinar. if there is a Basket as suggested by this economonist, what is my 1 dinar worth to me, if I wanted to cash it in at lets say Chase? I am thinking that that is $1.48