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

Originally Posted by prettyctk

adster, mike, cigarman....what are your thoughts on this post..i found on another forum?

A discussion about decreasing wages in Iraq. The “purchasing power” argument.
What HUGE drop in wages are you talking about????
Here’s a little background on Iraqi income.
Back around 1980, Iraq was considered one of the most advanced societies in the Arab world, even with that they had an average income of only about $3000 dollars a year. Iraq then went to war with Iran and that’s when their economy went in the crapper, and along with the help of the first gulf war the average income was down to about $800 dollars a year prior to the invasion 2002/2003. Latest estimates I’ve seen it’s currently about $1000 dollars a year. So that’s up a little from pre-war and yes… that’s a significant decrease from 1980 (26 years ago), but it’s no where near the .31 to .00068 decrease that you are portraying it to be.
When did Iraqis ever have this “purchasing power” that everyone speaks of????

You seem to trying to say that just because the exchange rate was higher, they made more money.
I’ve done the research… Iraqis have never made much money. The fact is that in 1980 the average Iraqi made the equivalence of 3000 US dollars a year. That is a fact. I don’t know what the exchange rate was in 1980 and I really don’t care. If it was 3:1, three dinars for every dollar, then the average Iraqi made 1000 dinar a year. If the exchange rate was .33 dinar for 1 dollar then the average Iraqi made about 9000 dinar a year. Just like now the Average Iraqi makes the equivalence of 1000 US dollars a year. That’s 1,475,000 dinars a year. Is there anyone here that really believes that they will revalue to 1:1 and suddenly the average Iraqi will start making 1.5 million dollars a year… or even .33:1, that would be .5 million dollars a year...
Anyone???

The “Iraq should be equal to Kuwait” argument.
Dinars in circulation.
Iraq.....9,000,000,000,000
Kuwait..........500,000,000

So Iraq has 18 thousand times more Dinar in circulation.

How about M2, that takes care of the “Kuwait is electronic” argument.
Iraq........15,000,000,000,000
Kuwait..........10,000,000,000

That’s 1 thousand five hundred times more M2.

So if you take Kuwait’s 3.10 exchange rate and divide it by 1500... That’s .00206


The “they have to walk around with wheelbarrows full of money” argument.
25K Dinar = $17
10K Dinar = $6.8
5K Dinar = $3.4
1K Dinar = $0.68
500 Dinar = $0.34
Seems to me that they have bills out that are pretty much equal to the bills that we carry around every day. I’m not sure why we keep hearing that their money is worthless.
They’ll revalue at 1:1, but they would never print new currency.
I always hear the argument that they wont issue new currency because of the cost. If they revalue to 1:1 they have to print all new currency anyway.

“Iraq has all that Oil and Natural Gas.”
For anyone that thinks that the Iraqi Dinar is going to revalue anywhere near 1:1, please tell me of another country that has 9 trillion units of currency in circulation and has a value near 1:1. It should be very easy to find. Google the name of any country along with currency and M1 and you should get the figure. Please don’t tell me that Iraq is different because of all the oil. None of the other big oil producers come close to a 1:1 value with the same amount of currency. Iraq has about a 50 billion dollar GDP, even if they get up to full throttle, double, triple, even quadruple their GDP to 200 billion, that would still leave them 60X short of the US GDP of 12 trillion. If we based it just on GDP, and give them the quadrupled figure of 200 billion, that would mean a value of .016. But that doesn’t take into account the fact that they have 9 or 10 times more currency in circulation than the US. That reduces it to .0016. How can you possibly ignore those numbers. It’s a known fact that they don’t have the reserves to revalue, it should also be pretty obvious that even with all that oil, they still don’t have any way to revalue anywhere near 1:1.

“Their companies will be bought up for penuts” argument.
This has been talked about in conjunction with a revalue of the currency. The way I see it, if a company in Iraq making widgets is worth 10 billion dinar or 10 million dollars prior to a 1:1 revalue, that company is still only worth 10 million dollars after a revalue. The change would be that instead of being worth 10 billion dinar, they’re now worth 10 million dinar.
Widgets prices/profits didn’t go up 1000 times.
This goes back to the Pepsi salesman thought. His salary cannot increase 1000 times, because they can’t increase the price of a Pepsi 1000 times.

Banks will somehow be worth more after a revalue.
Banks are just like any other company, they make money by providing a service/product. Banks take our money (deposits) and loan it out to others who pay interest on the loan. The money/reserves sitting in banks is not the banks money.
The logic that needs to be extracted is that there will be no large revalue of the dinar and that it’s not necessary to revalue to somehow save Iraqi companies from being bought out. A countries exchange rate has practically nothing to do with the value of a company.

More comparisons, this time… “Why Isn’t Iraq equal or better than Jordan”?
I’ve posted numbers and facts to explain this in the past, I’ll use the company/stocks example since we’ve been hashing that out.
Think of Iraq as a company, think of Jordan or any other country you’d like as a company also. Just like a company has a value, a country has a value (reserves/GDP). Companies go public and sell shares. Countries have units of currency.
Company A and Company B let’s say are both worth 1 million dollars.
Company A sells 10,000 shares at a price of $100 a share.
Company B sells 100,000 shares at a price of $10 a share.
A=$100 B=$10… heck A has to be worth more…. Wronge… they are the same because you have to take into account the number of shares.
It’s the same thing with a comparison between Iraq and any other country. You have to take more into account than just the end number of .00068 or .1.4.
Iraq is much more like company B in the example. They have 9 TRILLION units/shares floating around out there. I just did a quick search and as of July 2004 Jordan had about 3 Billion units/shares out there. So Iraq has 3000x more currency/shares.
Jordan exchange rate 1.4 divided by 3000 = .00046. Guess what… that’s less than Iraq at .00068.

The “It just has to be higher” argument.
Where does this belief that the numbers have to be the same come from??
It’s just a number… what difference does it make whether it’s a small number or a big number… it’s all relative. I’ll ask you, like others to explain Japan. They have an exchange rate of 100 yen to the dollar… how do they ever afford anything???
A better example… ITALY!!! Before they went to the Euro they used the Lira…
The exchange rate for the Lira was $1 = 1535 Lira or 1 Lira = $.00065…. that’s almost exactly what the Iraqi dinar is today. How did the country survive?? How did they have purchasing power?? How did they buy foreign goods?? Also… imagine this… they managed to convert over to the Euro (think GCC here) without having a massive revalue. Their companies didn’t get bought up by foreign investors. How did Italy do all of this????? Answer… it’s just a number… it doesn’t mean JACK

Interesting,

In my opinion the poster is not familiar with revalue issues when it comes to pricing of goods and services. It is not that everyone gets paid at the rate of currency as it was, it is all adjusted accordingly to fall into the same category as before. If a soda is 1000 dinar today, well obviously it won't cost 1000 after revalue, it will be adjusted, just as wages will, so there is no relationship to revalue, it impacts only those who are outside of Iraq or wealthy enough to have saved some dinar. It is not an issue.

Good luck to all, MIke

Having read the latest pros and cons of the IQD issues especially the one from prettyctk made me wonder who really is right. Both sides of the arguments make sense, but I really hope that Adam, Mike, cigarman etc. are right with their arguments for a 1:1 or greater revalue. I was thinking as to why would Iraq even consider a 1:1 or greater revalue to benefit all the outside investors and having to cough up trillions of dollars which they don't even have. And this argument concerning the oil that the revenues from this commodity will take care of financing such a high revalue can't be right because it will take years before they can pump out enough oil to benefit the country to the point where they could perhaps cover some of that revalue of 1:1. It seems to be more and more difficult to me to understand how they could ever come up with this kind of money to support this hoped for revalue just to make outside invetors rich and the average Iraqis still not benefiting themselves. It just doesn't make any sense. I personally have a few million IQD's and hope for the best but as I see all these different arguments I am afraid that this is another losing venture. I really hope for a miracle though.

All the best wishes to all here,

gogreen

Originally Posted by gogreen

Having read the latest pros and cons of the IQD issues especially the one from prettyctk made me wonder who really is right. Both sides of the arguments make sense, but I really hope that Adam, Mike, cigarman etc. are right with their arguments for a 1:1 or greater revalue.

gogreen

Hey gogreen

Well it is not just "Adam, Mike, and cigarmans arguments". They are claiming they have sources that are in the know about this revalue. So I guess the question should be. Does Adam, Mike and cigarman REALLY believe their sources and that their sources are really "in the know"? That is the question. Because if their sources are REALLY in the know and have an inside. Then we will all be happy campers by the end of this year. Right?

Did you guys know that this is the largest thread we have on RC?
Over 4k posts in this one.

Try to make a new thread for recent news. Not all can keep up with reading 4000 posts.LOL

But if someone takes the time, then i am sure they will learn alot.

Regards
admin

Originally Posted by gogreen

Having read the latest pros and cons of the IQD issues especially the one from prettyctk made me wonder who really is right. Both sides of the arguments make sense, but I really hope that Adam, Mike, cigarman etc. are right with their arguments for a 1:1 or greater revalue. I was thinking as to why would Iraq even consider a 1:1 or greater revalue to benefit all the outside investors and having to cough up trillions of dollars which they don't even have. And this argument concerning the oil that the revenues from this commodity will take care of financing such a high revalue can't be right because it will take years before they can pump out enough oil to benefit the country to the point where they could perhaps cover some of that revalue of 1:1. It seems to be more and more difficult to me to understand how they could ever come up with this kind of money to support this hoped for revalue just to make outside invetors rich and the average Iraqis still not benefiting themselves. It just doesn't make any sense. I personally have a few million IQD's and hope for the best but as I see all these different arguments I am afraid that this is another losing venture. I really hope for a miracle though.

All the best wishes to all here,

gogreen

You are totally missing the point of investing in the IQD...you see it DOESN"T MATTER who is right on this one...we will make money either way. One instance will turn a one thousand dollar investment into a million dollar lottery and the other will basically double the initial investment. What's not to like? This is a no lose situation so there is no need to be afraid in the least. I personally don't waste much time dreaming of the millionaire scenario... just like the idea of becoming debt free.

danny

I found this on another forum... just sounds so good.. hope it's ok to post..if it's already been posted..sorry.. libby

Hello Forum,
I just would like to start out by saying that I am pretty new to this forum and in no way am I calling myself an expert but I would just like to throw this out there, My brother is a higher up with Exxon/Mobil and he has many friends that have tons of money, I told him about the dinar about 3 months ago when I purchased alot of it for myself and told him to invest in it also - My brother being a true pessimist asked around where he works and was stunned when he was told by some people that it will be the best investment that someone could make in there lifetime - him not knowing anything about it kept digging and asking questions and 2 people in particlular that he spoke to said that they have multiple contacts telling them that the dinar will be revalued anywhere from .60 to 1.12 and they own millions of it. My brother tells me that these guys dont risk money and are not chance takers at all and the info must be strong for them to invest or they never would.
In truth I am an invester and I have alot of dinar but find it hard to believe that it can be revalued and turn so many regular people into rich people that fast, I invested because I had the money to spare and I dont trust the maket because I lost so much over the years and I am a bit of a gambler, but now my brother has turned into an invester also and let me just say this he wouldn't invest in anything (TRUST ME) anything can not stress that enough unless he was assured and trusted the sources 100%,
I have asked him about his friends contacts and he told me that one of them had a higher up in the iraqi government thats a family menber and knows exactly whats going on.
I know and pray that this is true but honestly still don't believe it even with what my brother has told me - I just wanted to pass this info along and see what some other people might think, again thank you for you time
and do your own research and dont listen to anyone.

The world and Iraq would not be going to all this trouble if they were not going to r/v high. A low r/v benefits noone, not the people of Iraq, their government, the US, or the rest of the world that have invested heavily in Iraq.

They are currently knocking out oil at $78 barrel which will rise to $100 a barrel by the end of September..............

They are making over a $$$ billion a day currently from oil!!!! They have only discovered 10% of oil in the ground...................

We know the government have hinted at a level equal to the dollar and are looking at ways to do this NOW.....................

We have also read they would like to get it back to $3.22 and whether it is currently viable...................

We know there are smaller denoms waiting to be unleashd when the time is right to replace the bigger notes like the 25k, 10k etc..................

We know the FI Law in Kurdistan has already been passed and the one of the whole of Iraq should be presented to parliament for approval tomorrow..................

We know the ISX will be opening shortly, (September)..........................

We know a r/v has the backing and approval of the IMF and World Bank and is part of their agreement.........................

We know the US NEEDS to pay for the war somehow.......................

We know Maliki is due to meet Bush on 25th.................................

We know we will be rich very soon...................................

I'm feeling good, anyone else?

Like it!!

http://www.mnf-iraq.com/


U.S. Secretary of Commerce meets with Iraqi officials
Tuesday, 18 July 2006
Image

BAGHDAD – U.S. Secretary of Commerce Carlos Gutierrez visited Baghdad and met with Iraqi Prime Minister Nouri al-Maliki, other senior officials and private sector representatives July 17 to discuss ways to help the Iraqi economy grow, boost jobs and become more integrated in the regional economy.

“Promoting private sector development in Iraq is a key part of the new Government’s strategy to expand the economy and foster peace, stability and prosperity for the Iraqi people. Prime Minister Maliki and the new Iraqi government face many opportunities and challenges on the road to building a well functioning modern economy.

But progress is being made - registered companies have soared from 8,000 to 34,000 and there are now 7 million subscribers of cellular services. I was impressed by the free market oriented initiatives announced by the prime minister in his speech to Parliament on July 12. President Bush and the entire administration are committed to helping the Iraqi people along the way,” said Gutierrez.
Last Updated ( Tuesday, 18 July 2006 )
Read more...

Hey bud, my new car is going to costs $153,626.32, So it better hurry up, fingers crossed and no I have not placed the order, yet am not that dumb.Just can't wait to excited about all the new choices I will have.
benzboy

Hello Adam,

i am feeling good too, i can smell it coming closer and closer.

David