3-20-13 Doc: There have been many dates thrown out...that suggest it has to happen by then. Many of these revolved around the publishing of the budget which should occur in a few days. The assumption is the RV rate is in the budget. We can find no evidence of this.
All published sources actually suggest the opposite.
Everyone is reporting an overall budget of 138 trillion dinar and not in the billions of dinar some have suggested. With the 138 trillion number the assumed exchange rate is the current program rate of 1166. We also know the budget is not a prerequisite for currency reform.
With this we are confident we will see this budget opened and it will have no impact on the RV. Simply put March will come and go with no new revelation.
We are much more interested in the late May time frame when the DFI funds become unprotected "free" game. We can only imagine the entities lining up to file suit against Iraq to get a share of the pot.
We simply can not imagine Iraq doing everything it can to get into a position to protect those funds. We would think this would include making amends with Kuwait ie chapter 7.
Unfortunately the wild card Maliki still is the wild card in this game. However, what we believe continues is the international community pressuring Iraq via chapter 7 (not done yet), Kurds pressuring Maliki via HCl (not done yet) and the people demonstrate against Maliki.
All-in-all the vice is squeezing Maliki pretty hard. Our hope is the vice will prevail. One would think even Maliki would relent rather than risk losing 100s of billions of dollars. Hence as we stated earlier late May is potentially of great significances. We report, you decide.