Thread: Rate That Iraq Can Support

Originally Posted by lndmn_01

As to why that NEED to reval, that's speculation but the fact that they WANT to return the dinar to the previous value (in fact to the value before Saddam has been stated) remains.

It is also FACT that IMF member nations MUST maintain the rate of their currency in a 4% range. What you are missing here is that they CANNOT increase the value to even $.01 after ascesion to the WTO, so, unless it is postponed the slow grow WILL NOT happen.

One last FACT is that a constantly changing currency, be it increasing or decreasing cause major problems in any economy and a catastrophe in an emerging economy like Iraq.

All I am looking for is a decent answer as to how they can get around both the IMF regulations and the problems caused by a constantly shifting currency value.

Thanks!

I was unaware of the highlighted part. I feel this is huge as they are getting close to becoming a member.

Originally Posted by lndmn_01

please explain to me how a slow, continuous rise in the value will work.

With the IMF regulations requiring member nations to maintain their currency value in a (approx.) 4% range it seems to me that the entire argument would be over.

I can only see a slow rise causing massive economic problems for Iraq. If the value of a currency continually increases by (being conservative) 25% a year it seems that it would disrupt all business to the point that Iraq could not function on the world market.

That is if iraq choses to do a peg of there currency...the margin is 4% now if they alow there curency to float...the market can determine the rate allowing the sky is the limit up wards or down wards....so yes you are right that a peg and a low rv is done for...but a float on the market is a whole nother coversation for discussion...from what i have read and understand the sky is the limit in a float situation

Originally Posted by dinartank

That is if iraq choses to do a peg of there currency...the margin is 4% now if they alow there curency to float...the market can determine the rate allowing the sky is the limit up wards or down wards....so yes you are right that a peg and a low rv is done for...but a float on the market is a whole nother coversation for discussion...from what i have read and understand the sky is the limit in a float situation

Thanks DT, I'll check it out.

You know I was just thinking, oil and gas are something that the entire world needs and most countries will do just about anything to keep the supply coming in as needed including the USA.

Now that we know that Iraq has more oil than Iran and Saudi Arabia, which we have learned are both running short on supplies, I believe Iraq can do any dang thing they want to with their currency since they hold all the cards.

I believe that once they get all their debts settled and their laws in the books we will all see something happen that may very well change the entire world as we know it.

Some argue they don't have the reserves to do it, who cares! They have something the entire planet needs, would you like some of it or not?

Once this thing is in motion they will decide what they can and can not do, and I for one say they will be able to do anything they wish.

10 cents on the dollar? I think not!

The sky is definatly the limit!

uhhhh-why not a catagory for less than pre-war rate???

I think you may need to start your own thread for that, I've never started one before but I'm pretty sure there is a link somewhere to do it. Best wishes, lewscrew

If goes for less than a $1.00 then the country cannot dedollarize the economy. If it goes for to much say $5.00 then the economy could fall apart. You needd to remember that even with all the oil they have they still have to get it out of the ground. I worked in the oil field for 18 yrs and I know it is expensive to do just that get it out of the ground. That said the Dinar needs to be at least worth a $1.00. It cost millions to drill [in U.S.D.] so in Dinars it would be billions for the same drilling. Question is how many Billions of Dinar do they have?? You all do the math at the present exchange rate it would not make sense to not RV thier money.. IMHO Bill

Originally Posted by wessgs

If goes for less than a $1.00 then the country cannot dedollarize the economy. If it goes for to much say $5.00 then the economy could fall apart. You needd to remember that even with all the oil they have they still have to get it out of the ground. I worked in the oil field for 18 yrs and I know it is expensive to do just that get it out of the ground. That said the Dinar needs to be at least worth a $1.00. It cost millions to drill [in U.S.D.] so in Dinars it would be billions for the same drilling. Question is how many Billions of Dinar do they have?? You all do the math at the present exchange rate it would not make sense to not RV thier money.. IMHO Bill

only difference is, oil is massively cheap to extract and refine in iraq since it has less parafin for better viscosity, and is shallow not to mention plentiful.

Well that would mean a higher RV the way I look at that. Bill

Originally Posted by shotgunsusie

only difference is, oil is massively cheap to extract and refine in iraq since it has less parafin for better viscosity, and is shallow not to mention plentiful.

WOOT!