Brule Credit for this article goes to Brian
Central Bank announces the withdrawal of 50 dinars a class of trading
Thursday February 26, 2015 14:35 said the Iraqi Central Bank, on Thursday, for the withdrawal of currency 50 dinars category of trading, indicating that the replacement will continue for two months.
The bank said in a statement received " Alsumaria News ", a copy of it, he was" given to stop the public from trading paper Cash category 50 dinars, he decided to withdraw this banknote trading based authorized to article 36 of the powers of the Bank Act No. 56 of 2004 ".
The bank added that "the banks and their branches will start replacing these banknotes presented to it and without fee or commission," noting that "banks will deposited with the bank and its branches for the purpose of being the equivalent value in the accounts we have. "
The Bank noted that "the term that will replace these banknotes will begin on the first of March to 30 of April next," stressing that "the end of the period of replacement will be banknote void and have no discharge power will not be accepted in Iraq."
It is noteworthy that the bank CBI issued after 2003 and banknotes from the category of 50 dinars, but he is not traded due to the high prices of the products offered in the market.
mike Huh, why would they get rid of the 50 note?
rissas dad Sorry Brule, think we were posting this at the same time. Moderator please?
Brule Yota pointed out that the CBI press release was dated yesterday, and released today.
Yota also pulled Article 36:
Article 36 Redemption of currency
1. The CBI may decide to redeem banknotes or coins by issuing, free of charge, other banknotes or coins in equivalent amounts.
A decision to redeem banknotes or coins shall be issued in the form of a regulation of the CBI specifying the period during which the exchange shall take place and the locations and times at which withdrawn banknotes or coins shall be presented for redemption.
2. At the end of the exchange period, or at any other time specified by the CBI, redeemed banknotes and coins shall be demonetized and cease to be legal tender.
3. The CBI shall notify the public, by publication in the Official Publication, of the banknotes and coins that are legal tender.
Brule No harm, no foul, RD!
Greg So I guess we need to sell our 50 dinar notes to dealers????
Mally Unless there is more info to come its hard for me to reconcile this article with currency reform adding value in the near future. It sounds to me like the 50 dinar note has such little value its just not practical to have so they are doing away with it. Why now after 12 years?
Adadude They're basically stating that the 50 dinar note is not used enough to be relevent due to it's small purchasing power. Remeber that 1166IQD = 1USD. Converting that means that 50IQD = .04USD...
Brian Adadude, Agreed..... But...... Why now? I think anything imminent is just not realistic and who is to say they don't do this with larger denoms? Wonder how this effects Tlars thinking? Anybody hear from LoJack?
rissas dad This all depends on what they get in return for the 50s. This statement "
"banks will deposited with the bank and its branches for the purpose of being the equivalent value in the accounts we have. "
indicates that they will take the 50s in on deposit for an equivalent value, but of what? Larger notes or smaller denominations.
This is either really really good and a change is very soon or we have been duped and they will bring in the notes starting with the 50s and void them out until our currency (outside of Iraq) is worthless. Boy oh boy this opened up a can of worms this morning.
The troubling part is the eternal optimists will spin it one way and the negatives the other. We'll know in a short time what this means. Keep your fingers crossed folks.
Dinarblowyourhorn Does it say that the notes will be collected and deposited in an account at your local back in the equivalent amount...?
Saying that they will not just give you equivalent value of currency, but they will credit your account with that amount. Maybe a good way to get everyone to open an account since everyone has a 50 dinar note laying around.
Mally rissas dad, Unless there is more info to come they are telling us the reason is CBI issued after 2003 and banknotes from the category of 50 dinars, but he is not traded due to the high prices of the products offered in the market. In other words we dont need a denom worth a fraction of a penny.
I wish I could find a way to see how this could be positive but Im struggling to. Guess its good the cbi is active doing new things but man this one is upsetting imo.
Brule I see this as a plan to get Iraqis into the banks. They don't trust the banks, so why not start an account with the lowest denomination, and then see the benefits. "Replaced" and not eliminated.
I am recalling the recent statements regarding Wells Fargo collecting and holding one billion dinar from Dinarians. If we were to be duped, WF and many other institutions, including the UST, are going to be a little irritated.
Considering dinars are to be used as reserve currency in many countries, does anybody think the CBI will not revalue and screw us? Especially in the middle of a war where they are depending on us. Iraq is to receive small arms from the US next week to fight ISIS.
This is Iraq, but being duped isn't adding up to me. And then again, I might be the eternal optimist.
Bingo When I go to that website to read the article there are 2 active links:
1 - Central Bank allows companies to participate remittance currency auction
2 - High central bank sales on Sunday to $ 140 million
However when you click on them it takes you to news dated 2014. And these links are in the middle of the article. Could this be an old rehashed article?
rissas dad Brule I hear you, but everything that keeps us optimistic is all "grey area" information. All of it. Its impossible to believe 100% in Tlar's WF information no matter how much I want to, or that the treasury has dinar, etc.
Yes they have stated they want the dinar to be a hard currency held by countries but that could mean much later down the road after what they are doing now to these 50s. Bingo, Article I'm looking at is dated today.
Bingo Yes, the article about the 50 dinar note is dated today, but embedded in that article (not the text posted here but the website's URL itself) has those other links in the article which takes you to news dated 2014. Just seemed maybe odd. IDK.
Brule The auctions stopped, which drove the Iraqis into the banks for cash. Here is another reason for the Iraqis to get into the banks, and I would think these actions are leading the Iraqis to a cashless society, and there are the results of bank deposits value at the time of an RV.
BigJohn It appears that this supports the theory that amounts deposited into a bank account will not see the RV appreciation that a physical dinar note will see. IMO
hi-five I went to the news link and this was the article that came up.
Iraqi Central Bank adopts new transfer and money exchange system
February 25, 2015 11:22 A well-informed source said on Wednesday that the Iraqi Central Bank started adopting a new money transfer and money exchange system; while pointing out that the bank has denied that it stopped selling Dollars.
“The Central Bank has adopted a new system when it comes to money transferring and money exchange”, said the source to Alsumaria.
This same source who wished to remain anonymous added that “the bank denied that Dollar exchange transactions have ceased”.
Iraqi Central Bank was established as an independent entity by virtue of the law ratified in March 2004. It is responsible for maintaining stable prices and implementing monetary policies including exchange rates policies, managing foreign reserves, issuing and managing currency in addition to organizing the banking sector to promote an independent and competitive financial system.
Companies : Alsumaria
G-Lin I just talked to Sterling Currency Group and ask about this art. He said no matter what Iraq does in country regarding the notes, that they would still be treated the same here in the US.
I said ok let me ask you a question, say we have an rv May 1st after Iraq stops honoring the 50 dinar note on Apr. 30th, what happens. He said it would still be honored at the rate it adjust to here in US.
I said so you are sure we don't need to panic and he said no maam no need to panic. Others might want to call some dealers, but that is all I got. Oh BTW they don't sell 50's. And GM.. :)
High-five I also wondered about that, BigJohn. What I can't get my head around is why the 50 dinar note? Could this be talking about turning in the counterfeitable notes?
BigJohn Could it be that the $50 dinar note has the highest number (quantity) in circulation and it provides a tool to drive people to the banks? Possibly.
Remember, their goal is to get Itaqis into the banks. The April 30th deadline speaks volumes and I'm not smoking anything. With all that has transpired in just the past 60 days, I cannot help but believe this is good news. JMO
Rissas dad Other than if this is a first-step move than the smallest note would be a good choice to begin with. Not sure I've ever heard of bogus 50s being out there. They arent worth it to counterfeit, so much so that when the CBI reprinted notes with added security features these werent done.
KJWayne They arent worth it to counterfeit, so much so that when the CBI reprinted notes with added security features these werent done.
Exactly why they want the 50's back in their control, to take the bills off the street . So when they "RV" that the 50's WON'T be out there with any value to them. My mind is going all over the place with this money thought!
Mally I appreciate you taking the time to do that G-lin and taking the time to share it here. I dont trust that info though, jmo. If the 50 is no longer legal tender in Iraq it wont be anywhere else either.
Why would a dealer pay you for something they cant turn around and trade in at a bank? I believe it will take a little bit for the dealers to digest the info just as it is taking us. JMO, dont mean to be overly negative and I really appreciate all the opinions.
Rissas dad Thank you G-Lin for making that call, really appreciate that.
"the end of the period of replacement will be banknote void and have no discharge power will not be accepted in Iraq."
Combine this with what you were told G-Lin, is this the same as what happened here in the US with the $1000 bill? The US didnt want those out in public but they still have value if you owned one, right? Maybe this is why sterling told you the notes are still valid. Hope so.
G-lin Brule, Hey lady. GM. Well I sure cannot guarantee how lawful my conversation was, but I'm just repeating what I was told. Maybe rv before April 30 and no worries
Hi-five So there are two main thought trails so far:
1) The 50 dinar notes are being called in because the value is so low that they are no longer needed. (Meaning no RV in forseeable future.)
2) The 50 dinar notes, which do not have security features, are being called in as a means to get Iraqis to use the banking system. Imagine an Iraqi coming in for the first time and opening a bank account, handing over his three 50 dinar notes, and proudly walking out with .14 cents in the bank. I assume this would be in preparation for an increase in value.
Rissas dad When G-Lin posted what she was told, I felt EXACTLY the same way. I dont trust any dinar dealer info and I've bought from them many times without any issues.
Its in their best interest to calm us. At first I thought the same, how can they honor a note outside of that country when that country voids the value of that note?
The only way it makes any sense is if its like the thousand dollar bill here (see my post above please). They are telling the Iraqis to come into the banks and open an account if you want any value for these 50s. Giving a deadline and a rather short one hints at something soon, hopefully something good. Either way 60 days and it should be clearer.
KJWayne Another thought, What better way to get Iraqs into the bank than to tell them the 50 will no longer be any good after April and then RV on the 1st of March. Now those 50's have value and the Iraqs will flock in the banks to replace those 50's with what will replace them !
Mally G-lin, Ya could be. Good thought but in that instance didnt we just stop printing the 1000 dollar bill? If we gave a specific call in period for it and said it was not legal tender after the date I would think the 1000 dollar bill would be worthless then after that date which isnt the case. Who knows. We should know a lot more next week.
G-Lin Hey mally GM. And yes I share your reservations. This art. is a conundrum. ;) When dealing in money, I trust no one. I did find it interesting that they no longer sell the 50. Yikes. :roll: Maybe a few others could check with different dealers and we could compare notes. Also would like to get Shredd's opinion. I would think a sharp honest banker that speaks dinar could give some insite.
Oldwazhisname Well, I'm a banker and I am as perplexed and concerned as any of you are. Some events that we see unfolding these last weeks kinda maybe indicate something positive is about to happen.
But the elimination of the smallest denomination in their currency at a time when we think something is about to happen speaks volumes.
Several possible explanations have already been thrown out here (getting currency off the street, etc) and none of them so far offer a satisfactory explanation of this step.
This is a little like when Sabbibi was prsecuted and fled, some tried to put a positive spin on it, but in hindsight it was a clear marker for those who could interpret it that nothing was going to hapeen with currency reform for a long time.
This kinda slams the lid down quick and is catching alot of emotional fingers that were reaching into that pot, IMO.
Kimberley OWHN,... As a banker, would your bank take in a note that was no longer accepted Iraq ??? Would it make any difference if it's face value, were say $50.....?
hi-five This was posted by Markinsa at DV:
At the end of 2013, there was 9 Billion 50 Dinar notes Issued. Only 800 Million was on deposit at 3 Banks. It could be to bring those notes back in for deposit, or allow them to be written off.
Read more: http://dinarvets.com/forums/index.php?/topic/197941-50-dinar-note-removed-from-circulation/#ixzz3SrozCJO8
If value is to be added soon, that is a lot of 50 dinar notes, with no security features, out on the street.
Kimberley G-Lin,...this article has now been removed from their rolling topics..........no comments.......no explaination.........
Brule G-Lin, It was your effort that I applaud. I am not too sure Sterling would have an answer at this point. We don't.
T Jefferson Thanks for your opinion from your professional chair, Oldwazhisname. Grounds to keep my sanity and stay away from cliffs!:) I guess it's back to work for me.:|
Oilwizard Could it be related to money laundering and counterfeiting? They know how many 25K notes are out there. They have replaced most of the 10K notes with enhanced security features. What if Iran was aware of the imminent RV and was counterfeiting the unsuspecting 50 dinar notes and this is a way to combatt corruption?
Rockstar I really don't believe this is a big issue other than maybe as it says they are just replacing this note for some reason.
Or maybe if they are going to release all new lower Denoms on the street because they are going to RV the currency soon, the new 50 note will be in the lower denoms they have always talked about.
Our notes outside of Iraq will be good no worries and realistically not many people outside of Iraq should have many of the old 2003- 50 denom notes anyway.
Oldwashisname Kimberley, As long as the bill in question was still legal tender in the eyes of the US Treasury, we would accept it. I'm trying to think of an example in our own nation's experience that would be equivalent. The $2 bill is rare but still readily accepted.
The $50 bill was eliminated 50+ years ago but still remains legal tender and would be readily accepted as the US Treasury never rennounced it as legal tender.
The language used in the press release is its usual ackward translation so hard to say if its saying exactly what the translation seems to say: which is that the bill in question would no longer be legal tender.
It would be something of a relief to find out that the bill is just no longer going to be circulated in the banking system, but the wording seems to be stronger in than that. I'm sure we will find out more as time goes on.
Of course, if another countries currency was somehow no longer a recognized medium of exchange (say as in the case of when the Saddam notes were replaced), we wouldn't accept them.
One time I had some Currency left over from an earlier trip of some of the European countries that had adopted the Euro 10 years earlier and I tried to exchange it when I came back.
I was flat refused in the country of origin. If that were the case there, I would expect that would be the case here.
Rockstar Thinking about this a little more OWHN, I can see the concerns as the article specifically states it will be "null and void" after April 30th 2015. Who knows what total value this represents in their money supply as it could be just to reduce that..
.then RV the currency and then release all the new lower denoms which I know their is a new 50 note in there! That's the best case scenario of course now on the worst case scenario if they do this with the 50 note and it is completely worthless to us here which that maybe the case,
what's to stop them from doing the same thing with our 25k, 10k and 5k note right?? We basically financed all their corruption mainly Maliki and we all get screwed in the end and then its oh well...
that would truly suck right? I hoping that's not the case and I don't believe that it is but I would bet it's going through a lot of dinar minds right now!
Oldwazhisname This latest event really has me thinking....Ok, let me take a stab at this. I admit it’s going to freak everyone out but my goal is not that but really to stimulate everyone to try to think this through and come to some reasonable conclusions (if that is possible given our lack of accurate intel.
Intel has proven in Dinarland to be a total flop but the common sense, thoughtful process would so far put most people a head of the curve of the rest of the sheeple).
We know the CBI threw everyone a curve recently (including seemingly the GOI) that it would halt currency auctions. The reaction in the marketplace was swift and predictable:
the IQD exchange rate to the USD immediately worsened. It also caused a real liquidity crises on the street.
There is actually some earlier indications that this was already happening as the CBI seems to have taken a number of steps to remove IQD currency from circulation.
This latest action is just another step in the same direction, to reduce the availability of IQD on the street.
It is obvious that the CBI is taking some aggressive steps now to do something in line with the country’s currency. However, in spite of our dinar-colored glasses outlook, most of these steps have not been favorable to what we think ought to happen. Either, the steps were neutral or negative, IMO.
To cut to my hypothesis, is it possible that the CBI is driving the value of the IQD down, eliminating the availability of the currency (and therefore the negative effects of this in-country) in preparation for a lop-like currency event?
We know that countries who experience high inflation can do the lop and the reasons for it are understood and “accepted” in the marketplace. Iraq simply couldn’t make that case given the long term stability of the value of the IQD.
To me, the events are being clearly manipulated toward some outcome (versus just the natural course of events outside anyone’s control). “What exactly is the CBI doing?”, everyone is wondering. Well, you have to tally up the ledger and make some logical conclusions and they aren’t exactly what we expect.
Let me put it this way, the fans of a local pro baseball team can think that they are in the hunt for a pennant this year (no matter what, they have a rabid support for their team),
but when you see management trade their ace pitcher in late-August, the discerning fan knows the outcome before the final month and half are played. We might not be in “August” yet but it’s got to be at least mid-July, with this latest actions by the CBI.
Mally Thanks for your thoughts OWHN. Not to split hairs but in my reading about currency redenominations (lops). I am under the impression that the ideal time for countries to do this is when they have experienced hyper inflation but no longer are.
They need to rein in the inflation and if possible stop it all together and then they are allowed to lop. If the problems that led to the inflation still exist a lop will not fix anything.
That is why from a traditional perspective imo Iraq was always a prime candidate for the lop.
They had hyperinflation from a dictator and war but had it under control almost immediatly from the new system put in place in 2003.
The fact that several years later they still hadnt done it led me to believe there was a plan to increase the value through other means. Ive always said we are all buying on the rumor because traditionally things like this have never happened. Im pretty lost as to what they are doing at the moment, still hoping for the best March 1st.
Rockstar Great thoughts OWHN but I think it's more of reducing the money supply and or just replacing because the lack of security features on the bill.
Which I would HOPE they would RV before putting out the new 50 note that is basically worthless at today's value! It would have to cost them way more money to actually print up these new notes than the bill is actually worth, WHY would you do that unless you were going to add greater value to the note!
I also think this is huge for no other reason as you have said OWHN is they are actually in process of finally doing something with the currency right!!! Either way I don't care as long as they are finally making a move which they absolutely are now!!!
Mally Maybe they will rv on March 1st. Put out a new 1,5, 10, 20, 50 and fils. Allow two months to get rid of the old 50 since it is now redundant and not as secure as the new one and allow two years for the bigger bills. Has anyone seen my dinar goggles? Oh, never mind, Im wearing them.
Oldwazhisname Here is a wild thought: does anyone see the CBI's actions as counter to what the GOI is doing/saying? Could the CBI be doing its part to bring pressure on the GOI to get the economic laws on the books that is needed to move the country forward? This is not the traditional role of a Central Bank to try to effect political change but could the tail wag the dog in this case?
Mally OWHN, Seems totally plausible to me. Maybe outside forces have more sway with the somewhat autonomous cbi and are trying to get the goi to get in line by asking the cbi to do xyz. Its as good as any theory imo
Oldwashisname Mally, It doesn't even have to be outside forces. It could be "the good guys" in the new PMs office (remember Saleh is Abahdi's consultant) allowing the CBI to bring pressure to bear so movement takes place (the old law of physics).
Schiz Oh man, I don't know what to think about this, I can spin it in my head both ways, good and bad.
I knew they were going to screw over the citizens before they added value, i predicted they would be asked to change their notes for the new ones but I was talking after a rate change.
Is it possible for iraq to remove all of the current notes obviously leaving the most used classes till the very last and then bam, they rv and force those folks to swap them out but being aneutral event to them, ie straight swap. I'm really confused by this. Don't know what to think
My first thought was a bad one, they are going to do this to all thes notes and replace them over a period of time. make the 2003 invalid then BAM, rv the currency.............but, people could still buy the new notes unless they dont allow it to be sold outside of iraq.
We could get screwed over here bad ways or we could get screwed over but still be able to get in.
As you can tell my thoughts are all over the place with this one. Iread the article a few times trying to pick up on key words and points but came up with nothing but confusion in my head.
Gotta be honest, ive always had an after thought that iraq could screw everyone over including us.
This could be very very bad or the best thing in the world for us, im still betting on the best but am mighty confused right now. Perfect way to have a speculator just before a rate change, what better way to make me cash in my dinars right now, today!
Sorry for the messy post, it's kinda what my head is after reading this art
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