Thread: "RollsRoyce . . . June 25 Tidbit!"

Originally Posted by Onenomad

I agree about fundamentals of economics but this is just a program rate not the real value as stated by their ministers in such statements as return to normal rate etc. The fundamentals are Iraq is going to have the most Oil in the world (Once the entire country is explored) which is your supply and the world is going to continue to need more and more of it (demand) giving them a commodity worth loads of money to help back their currency (Which has not long been approved to do as per a article I believe Adster found) to go from the Program rate to the real value would have to be high enough to deal with speculation and also as has been seen in articles their desire to have the value equal that of surrounding countries. Again I'm no expert JMO

Hence exactly what I was talking about!"to go from the Program rate to the real value would have to be high enough to deal with speculation and also as has been seen in articles their desire to have the value equal that of surrounding countries."

Originally Posted by screwball

Hence exactly what I was talking about!"to go from the Program rate to the real value would have to be high enough to deal with speculation and also as has been seen in articles their desire to have the value equal that of surrounding countries."

Yes I agree with that, Initially come back onto the world market at a high rate to achieve those results and then a gradual raise as market forces dictate

Originally Posted by Onenomad

I agree about fundamentals of economics but this is just a program rate not the real value as stated by their ministers in such statements as return to normal rate etc. The fundamentals are Iraq is going to have the most Oil in the world (Once the entire country is explored) which is your supply and the world is going to continue to need more and more of it (demand) giving them a commodity worth loads of money to help back their currency (Which has not long been approved to do as per a article I believe Adster found) to go from the Program rate to the real value would have to be high enough to deal with speculation and also as has been seen in articles their desire to have the value equal that of surrounding countries. Again I'm no expert JMO

I wholeheartedly agree with your take on the program rate and the fact that Iraq is sitting on a pot of huge wealth. No one can dispute this. The value of the dinar will be on par with its neighbours...over time though and will not be as a result of an overnight dramatic rv that we all hanker for.

Originally Posted by breakeven

I wholeheartedly agree with your take on the program rate and the fact that Iraq is sitting on a pot of huge wealth. No one can dispute this. The value of the dinar will be on par with its neighbours...over time though and will not be as a result of an overnight dramatic rv that we all hanker for.

It doesn't really matter if it is "overnight" or over a longer period of time as long as the value increases dramatically. If the value goes from its current position to anything around 1:1 then the time frame doesn't matter a wit. As you said the country of Iraq is sitting on a pot of huge wealth, but who is to say when and how they will tap into that stored wealth.

For example what is the difference if it were to go 1:1 tommorrow or if I were to fall into acoma tonight and wake up in 5 years to find that it had gone 1:1 the day before I woke up. Nothing would be any different for me, except that I had skipped the wait. So, if we can all just have a little patience whether it be a few days or a few years it will happen.

If anyone deserves to have less patience its the Iraqis, but as for us its just a matter of time. So why get all bent about it.

Originally Posted by TerryTate

It doesn't really matter if it is "overnight" or over a longer period of time as long as the value increases dramatically. If the value goes from its current position to anything around 1:1 then the time frame doesn't matter a wit. As you said the country of Iraq is sitting on a pot of huge wealth, but who is to say when and how they will tap into that stored wealth.

For example what is the difference if it were to go 1:1 tommorrow or if I were to fall into acoma tonight and wake up in 5 years to find that it had gone 1:1 the day before I woke up. Nothing would be any different for me, except that I had skipped the wait. So, if we can all just have a little patience whether it be a few days or a few years it will happen.

If anyone deserves to have less patience its the Iraqis, but as for us its just a matter of time. So why get all bent about it.

Yes, quite and I don't think anyone is getting bent about it. Just trying to put things in perspective and am merely alluding to the imminent rv theories that have been floating for a while now. Iraq has tremendous potential but it's also lying amidst ruins and political wranglings that will undoubtedly have a detrimental effect on progress. I'm in for the long haul and wouldn't care less if it took 5 years to reach the level of its neighbours.

Originally Posted by breakeven

I wholeheartedly agree with your take on the program rate and the fact that Iraq is sitting on a pot of huge wealth. No one can dispute this. The value of the dinar will be on par with its neighbours...over time though and will not be as a result of an overnight dramatic rv that we all hanker for.

But would it not stand to reason if the value dropped and set to the original program rate pretty much over night that taking it back to its true value would do the same and then from that point grow as market forces require?

Originally Posted by Onenomad

But would it not stand to reason if the value dropped and set to the original program rate pretty much over night that taking it back to its true value would do the same and then from that point grow as market forces require?

Fair point but wasn't that rate before Saddam's downfall was an arbitrary level was picked by Saddam and his cronies and had absolutely no basing in economic fundamentals? It's worth remembering that inflation during the 1990’s reached a staggering 100 percent level resulting in a collapse of the Iraqi dinar with very little global purchasing power parity although the previous official exchange Iraqi exchange rate is an illusion to the real economic situation that took place in Iraq during Mr. Hussein’s rule.

Isn't it the case that the economic prospects for a country determine the future value of its currency, not the price it trades at now or the price it traded at in the past.

Originally Posted by breakeven

Fair point but wasn't that rate before Saddam's downfall was an arbitrary level was picked by Saddam and his cronies and had absolutely no basing in economic fundamentals? It's worth remembering that inflation during the 1990’s reached a staggering 100 percent level resulting in a collapse of the Iraqi dinar with very little global purchasing power parity although the previous official exchange Iraqi exchange rate is an illusion to the real economic situation that took place in Iraq during Mr. Hussein’s rule.

Isn't it the case that the economic prospects for a country determine the future value of its currency, not the price it trades at now or the price it traded at in the past.

Yes agree 100% and with their economic prospects I would think a fairly large value on their return to the world stage would be a fair assumption for them to build apon to its true rate like everything its all speculation.

Originally Posted by TerryTate

It doesn't really matter if it is "overnight" or over a longer period of time as long as the value increases dramatically. If the value goes from its current position to anything around 1:1 then the time frame doesn't matter a wit. As you said the country of Iraq is sitting on a pot of huge wealth, but who is to say when and how they will tap into that stored wealth.

For example what is the difference if it were to go 1:1 tommorrow or if I were to fall into acoma tonight and wake up in 5 years to find that it had gone 1:1 the day before I woke up. Nothing would be any different for me, except that I had skipped the wait. So, if we can all just have a little patience whether it be a few days or a few years it will happen.

If anyone deserves to have less patience its the Iraqis, but as for us its just a matter of time. So why get all bent about it.

Excuse me for barging into the discussion you guys are having; my take is equivalent to this:

If I came into wealth, whether it was tied up in investments or not, potential creditors would view me as a potential source of income. If there were 10 billion dollars riding here or there, a line at my door would form, and deals could be arranged. No difference here. I may not be able to lay my hands on that money immediately, and the Iraqi's can't lay their hands on that oil immediately, but it is a powerful motivator.

What better way for the Iraqi people and GOI to say:

WE ARE ARRIVING!!!

You get these last laws passed...You get the remaining Big 3 to forgive the debt...You get the MAIN COMMODITY flowing in an upward BPD rate as the Kurds are CURRENTLY doing...And you SET THE CURRENCY...

The entire Country does NOT need to be rebuilt in order to move forward economically...

Originally Posted by breakeven

Fair point but wasn't that rate before Saddam's downfall was an arbitrary level was picked by Saddam and his cronies and had absolutely no basing in economic fundamentals? It's worth remembering that inflation during the 1990’s reached a staggering 100 percent level resulting in a collapse of the Iraqi dinar with very little global purchasing power parity although the previous official exchange Iraqi exchange rate is an illusion to the real economic situation that took place in Iraq during Mr. Hussein’s rule.

Isn't it the case that the economic prospects for a country determine the future value of its currency, not the price it trades at now or the price it traded at in the past.