Originally Posted by
haydenh
my 2 cents. I agree with both of you somewhat. The law or arbitrage does say that if there was a stock traded on the Iraqi excchange as well as another exchange, the prices of the socks on each exchange should be equal when taking into account the difference in the exchange rates. However i am unaware that there are any companies in that boat. Not that i have looked into it. If tere was then i may have more faith in the ISX. Should those banks be limited to the ISX, then their price should remain relatively unchanged until after the reval, there will go hand in hand. If their assets are the NID, then their asset base does not change unless the value goes up or an RV happens. I personally have found it almost impossible to do the reasearch on Iraqi stocks that we can here in AUS and the rest of the modern world. I would love to know more because i personally will move all my funds to the ISX should it open without a reval.
In one way i actually hope that you are correct, i could make an extra 50% + if i was able to put my money into the ISX before an RV. On the other hand i also want it to happen now.
If there is anyone who can point me in the direction to doing stock research on how the current stock prices were made up i woudl be able to tell you if they were undervalued as it stands right now. But i do believe that as a point of keeping the market stable, if the RV happens and a particular stock was worth 1NID now then it would be roughly the same after. I do not think that realistically stocks will be worth $12k as it would prevent small investors from entering the market. Even here in the AUS, i could count on one hand how many stocks were worth more than $100 each. If prices went through the roof in country to reflect the reval price we would instantly see hyperinflation and that would cause a major problem for everyone.
As has been implied many times in articles, i believe that they would like to be able to dedollarise the economy. To me that means the people want to pay the same price in NID for goods that they are currently paying in USD for goods. Whether that be a can of coke, a car, house or food.
I also believe that they need electronic banking in place ASAP to reduce the amount or physical cash from the economy. By doing that they will significantly reduce the amount of lower denom notes required, and hopefully crime and corruption. Who wants to rob a shop that only has $200 in the till??