Hi everyone, Neo asked me to post here and add to his analysis based on the chat we were having yesterday.
I read another analysis a while back which directed me to the CBI site. Under their laws and regulations you can find this pdf. http://www.cbi.iq/documents/CBILAW-EN_f.pdf. I would say this would be the articles of incorporation or their by laws on what their authority is how they are supposed to proceed. Nothing new here and this document has probably been found on many sites way back. Here is what struck me.
Section 1, Article 4 Functions
4. If the CBI proposes to issue a regulation pursuant to this law, it shall publish a draft of the proposed text of the regulation in a form and in a manner determined by it to be the best calculated to bring the proposed regulation to the attention of the domestic financial sector and the general public.
The draft shall be accompanied by an explanation of the purpose of the proposed regulation and a request for comments within a specified time of not less than one month after the date of publication of the draft.
The CBI shall have regard to any comment received and issue the final text of the regulation accompanied by an account in general terms of the comments.
The procedure set out in this paragraph shall not apply if the CBI determines that the delay involved would be a serious threat to the interests of the financial system or hinder the effective conduct of monetary policy, provided that such decision by the CBI shall be explained in the preamble to the regulation.
Here is my theory of what is happening now. I think that the CBI may have published a draft of the regulation that would outline there procedure for deleting the three zeros. Following their procedures, they would have to bring it to the attention to the domestic financial sector and the general public. They have certainly published many articles to bring the deletion of the zeros to the attention of all.
It further states that they will have a request for comments within a specified time of not less than one month after the date of the draft. We have certainly seen an abundance of articles start coming out from the economic sector and the political arena about why deleting the zeros is a good idea or a bad idea. If I remember correctly, CBI was not commenting until Shabs was threatened in some way and was very upset about the fact that the discourse was unprofessional. So then there were a few articles where Shabs said, back off because you (the GOI) sent us a letter asking us to look into this project. I also remember that CBI said you all are free to make comments and remark, but the CBI is going to continue the project to delete the three zeros. If you look at Section 4.4 again, you will see that while they will "have regard to any comment received", they are only obligated to publish " an account in general terms of the comments." when they "issue the final text of the regulation."
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Section 4.4 also states that the CBI does not have to wait for the 30 day period to end if "the CBI determines that the delay involved would be a serious threat to the interests of the financial system or hinder the effective conduct of monetary policy, provided that such decision by the CBI shall be explained in the preamble to the regulation." This says to me that Shabs does not have to wait to pull the trigger. But Shabs is a very methodical guy and I would imagine that he would follow procedure to a T if he could so that the CBI would not be able to be challenged.
In my opinion, this is what we are seeing right now and why there are so many articles on the pros and cons of the project to delete the zeros. I think that the draft they are discussing may be the article that was published by the Vice Governor of the Bank. Mohammed somebody.. I am sure a DS member will be able to pull up that article and post the link to this post. We can then look at it and see if it fits with this theory.
Also interesting to me is the arguments being made against the project. They mostly site problems with gangsters, terrorism, counterfeiting and money laundering. Shabs also stated in response to these comments that this is not a problem. Section 1, Article 4.2 states, "In addition, the CBI may take whatever action it deems necessary to: (i) counter money laundering and terrorist financing, ...." So the CBI is in charge of this too as their function and Shabs says this is not a problem, then poof - that comment for not doing it is baseless, because CBI handles this.
So now we are down to the pretty pathetic argument against by the Sadrists - it has many big problems, and he does not give one specific on why!
Other articles that I found interesting:
Section 4, Article 26 Prohibition on lending to the Government
Section 7 - Currency
Article 32 Issuance of currency
1. The CBI shall have the exclusive right to issue banknotes and coins intended for circulation in Iraq.
Article 33 Printing of the banknotes and minting of coins; accounting treatment of currency issued.
1. The CBI shall determine by regulation the denominations, measures, form, materials, content, weights, designs and other features of banknotes and coins. The plates necessary to print or mint the currency and the intellectual property rights to the designs of the currence shall be the property of the CBI.
*as always - JMO! for those who really like to dig in - it would be interesting to print out all the articles about the project and CBI responses from June 20th when Shabs said he would be putting out the small denoms and develop an outline to say if my theory makes sense. I am going off memory of the articles. Unfortunately I don't have a printer for my home computer!
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