ONLY 1- $25k DINAR: Well I have finally decided to break down and ask the question that has been bugging me for some time now.....I know we all want an RV and certainly the sooner the better BUT, Why does the RV need to happen???
The answer I hear over and over again is so that it can become an internationally traded currency -
Well there are other countries that are internationally traded curriencies with LOW exchange rates like the IQD, so why would the rate have to change for Iraq to be internationally traded???
If all the sanctions were dropped and they got out of Chapter 7, couldn't they then be internationally traded, at that point, without changing the exchange rate at all??????? Seems to they could just like the other low rate countries.... Thanks for your thoughts!
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RVPLEASETODAY: The Dinar isn't internationally traded (I assume you mean on Forex) because most of Iraq's GDP comes from the sale of oil, which is sold in dollars. Why would anyone want to speculate on their currency?
In addition, the country is terribly unstable at this point, walking on the edge of civil war and anarchy. Who would invest in such a currency?
You've got to understand that the only reason there is a potential payoff for us is that we paid almost nothing for the Dinar we hold. Once we cash in our Dinar, they become just dinar.
There is no big killing to be made on them by other people after that, particularly Forex traders, who make their money off of minute shifts in exchange rates.
There is a fundamental misunderstanding among many on Dinar forums that the Dinar has some inherent value that would cause other people to want to buy the dinar we would sell after an RV. That is incorrect.
The best they could do after that was make a few pennies on exchange rate differences should the currency ever become tradable on Forex.
SANDYF: The big question is what is meant by the term. The IQD is used to trade outside of Iraq, Citibank having been paying international invoices in IQD since 2006.
International recognition is a different thing altogether,this means IMF article 8, Iraq has never been an Article 8 currency.
As far as the RV is concerned,you are right,nothing need happen. The exchange rate of a country is linked to the GDP,so on the surface there is no justification for a huge RV. What everyone is speculating on is the hidden value of the DFI funds.
ONLY 1 - $25k DINAR: So, from what you both are saying, the exchange rate does NOT have to change to be internationally tradable like other countries with Low exchange rates.
Which leads me to wonder then, what IS the reason they have to change the rate at all???? Or isn't there a reason?
RVPLEASETODAY: They don't have to change the exchange rate. That's why the Dinar is so speculative. You hear a lot of these "they have to" statements because people want to pretend their highly speculative investment is a sure thing
4APROFIT: I there is no concern or need to ever change the rate of the Iraqi Dinar...(Why have'nt they just dumped it and moved on to more important things)....and why does anyone think that there wont be a better value coming to this currency?....
They have probably spent as much as it cost to print and distribute the stuff, as they have from haggling over the issues of this currency, why do so if worthless?...in other words if the currency is a "Non-Issue"...why has it been treated with more priority than any country in the world treats theirs, especially being so worthless?....
Why was it ever allowed to leave Iraqs borders, as well as be sold through most of the largest financial institutions in the world?....And if the country has had oil and infrastructure developments move in the trillions of dollars...unlike the world has ever seen....and one says that they cannot have a valuable currency, or at least eventually....
IMO..the reason I say sooner than later that this has to happen, is due to all of these monetary advancements which will continue, thus making it even more probable to have a better rate for your currency...
and then while Kuwait, with the most valuable currency in the world, is investing head over heels in Iraq...and in every form imagineable...wealth follows wealth and not poverty...
so, with all of this...why would one think that their currency should fail...IMO..I believe the small pips where it has went down a little here and there, is actually to deter specualtion before a rise in this currency...IMO, it would never do the opposite, like start rising right before a big gain or an RV...We will see.
RVPLEASETODAY: Well, it's anybody's guess. We are expecting an historically big increase in the exchange rate over an historically short time frame. So nobody really knows by what mechanism it could happen. So, your guess is as good as anyones.