Thread: Iraq/Dinar News. 09/05 to 01/14/07

Ref: Two Questions

I wold like to respond to two questions that have been asked.

The first question is how long do I think the CBI can continue the trend of removing dinar from circulation. Very dificult to make that judgement. If it is true that they have 4.5 Trillion in circulation, and they are approaching removing a Trillion dinar within the last week or so, I would expect this process to be about done. They have been successful in removing the dinar at a lower rate. Can you imagine trying to remove that amount of dinar and what it would cost should they have had an R/V at .31 USD to the dinar? The cost would have been tragic. How much longer can this go on? Expect them to continue to remove dinar until they reach their target, which we can only sit on the sidelines and watch. But the "trend is our friend". So we'll see what happens this week. As I have said before this week is going to be very interesting.

The second question was, "What if they remove too much"? This is when things really get interesting should they (CBI) misjudge and remove too much dinar. This would be similiar to a very profitable stock company who has few outstanding shares of stock. The price of the outstanding stock becomes very expensive. So you could expect basic supply and demand to take over and elevate the price of the dinar to atmospheric levels. (I can hear the screams of joy from here and the encouragement for the CBI to do to good of a job). Everyone have a good day.

Originally Posted by H2O_Lover

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ok could you explain this statement at the end of the article

“Banks’ offers to sell dollars mean letting more local currency to the market,” he added"

The banks are offering the CBI dollars in return for dinar which puts more dinar in circulation ( which causes inflation and low exchange rate ) which is exactly opposite of what the CBI is trying to do ( take dinar out of circulation ). Somebody please help me explain it where they can understand!

Originally Posted by Mike5200

It looks to me like a section of it IS missing - the context of what is being said is missing between the top and bottom half sentences. Is this info being embargoed because it is another clue to an RV date or rate? Can someone dig up the original article or perhaps its too late and has been censored everywhere it appeared? Hmmm.....

You can also find it here. Same article.

Central Bank to adopt new policy to end inflations' rates | Iraq Updates

Thank you for your informative explanations. Your knowledge is greatly appreciated. Can you set out the steps that need to happen before we can "cash in" please?

Originally Posted by Wm.Knowles

Ref: Two Questions

I wold like to respond to two questions that have been asked.

The first question is how long do I think the CBI can continue the trend of removing dinar from circulation. Very dificult to make that judgement. If it is true that they have 4.5 Trillion in circulation, and they are approaching removing a Trillion dinar within the last week or so, I would expect this process to be about done. They have been successful in removing the dinar at a lower rate. Can you imagine trying to remove that amount of dinar and what it would cost should they have had an R/V at .31 USD to the dinar? The cost would have been tragic. How much longer can this go on? Expect them to continue to remove dinar until they reach their target, which we can only sit on the sidelines and watch. But the "trend is our friend". So we'll see what happens this week. As I have said before this week is going to be very interesting.

The second question was, "What if they remove too much"? This is when things really get interesting should they (CBI) misjudge and remove too much dinar. This would be similiar to a very profitable stock company who has few outstanding shares of stock. The price of the outstanding stock becomes very expensive. So you could expect basic supply and demand to take over and elevate the price of the dinar to atmospheric levels. (I can hear the screams of joy from here and the encouragement for the CBI to do to good of a job). Everyone have a good day.

Iraq has WAY MORE than 4.5 trillion dinar in circulation, I have seen numbers all the way up to 19 trillion. I will do some digging and find you a TRUE number but 4.5 trillion aint it!

Originally Posted by Wm.Knowles

Ref: Two Questions

I wold like to respond to two questions that have been asked.

The first question is how long do I think the CBI can continue the trend of removing dinar from circulation. Very dificult to make that judgement. If it is true that they have 4.5 Trillion in circulation, and they are approaching removing a Trillion dinar within the last week or so, I would expect this process to be about done. They have been successful in removing the dinar at a lower rate. Can you imagine trying to remove that amount of dinar and what it would cost should they have had an R/V at .31 USD to the dinar? The cost would have been tragic. How much longer can this go on? Expect them to continue to remove dinar until they reach their target, which we can only sit on the sidelines and watch. But the "trend is our friend". So we'll see what happens this week. As I have said before this week is going to be very interesting.

The second question was, "What if they remove too much"? This is when things really get interesting should they (CBI) misjudge and remove too much dinar. This would be similiar to a very profitable stock company who has few outstanding shares of stock. The price of the outstanding stock becomes very expensive. So you could expect basic supply and demand to take over and elevate the price of the dinar to atmospheric levels. (I can hear the screams of joy from here and the encouragement for the CBI to do to good of a job). Everyone have a good day.

From your last comments here, it's a win win situation for all involved. It appears, this is because they have stated that they would like the rate to be back at .31, this would be the minimum target that they are shooting for. However, should they exceed their target in removing dinars, they would be looking at a more profitable exchange than anticipated. Is this how others understand it?

Dollarization can also be avoided if the dollars being flooded into the economy are being used to import goods and these dollars will simply be replaced with products.

For a little more on the subject of dollarization this article is a good read.

Dollarization Explained

Originally Posted by cigarman

Read the article, it's exactly what Knowles is saying. The CBI is trying to pull dinar off the streets, so their asking the banks to sell them dinar for dollar. If the banks offer the dollar then they expect dinar in return which causes the inflation that the CBI is trying to tame by buying the dinar out of circulation. Hope this helps.

Took the words right out of my mouth Cigarman..

btw.. check your pms..:)

Randy

[QUOTE=cigarman;135497]The banks are offering the CBI dollars in return for dinar which puts more dinar in circulation ( which causes inflation and low exchange rate ) which is exactly opposite of what the CBI is trying to do ( take dinar out of circulation ). Somebody please help me explain it where they can understand![/QUOT]

WOW .......

Somebody please help me explain it where they can understand

Originally Posted by Inscrutable

Dollarization can also be avoided if the dollars being flooded into the economy are being used to import goods and these dollars will simply be replaced with products.

For a little more on the subject of dollarization this article is a good read.

Dollarization Explained

This is what i thought the dollars were being used for. Replacing them with dinar would not get the job unless one thing happend !!

with out a doubt many people and many ideas on what is going on..