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  1. #1
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    Iraqi dinar would soon return to what it was prior to 1980

    Iraqi dinar would soon return to what it was prior to 1980 due to global demand: Banking and Finance Ministry Head

    Posted: February 3, 2013Official: declining reserves of the Central Bank of gold does not affect the rate of the dinar
    02/02/2013 11:45:00
    The head of the Department of Banking and Finance Ministry Hilal Taan diminishing quantities of central bank reserves of gold does not affect the price of the local currency.

    He said in a statement to the National Iraqi News / Nina / today: “The basket cash reserve covering currencies do not include the gold only, but depend on the dollar and the pound sterling and the euro, in addition to gold bullion.”

    He said: “The Iraqi dinar has been a week before the beginning of the deal by one of the sites of the U.S. because of the high currency reserves to more than $ 67 billion is evidence that the Iraqi currency backed by a strong balance can not be influenced by declining gold bullion.”

    He pointed out that “the dinar traded in global financial directory sites on the recovery of the currency and that there is a future for the Iraqi dinar and would soon return to what it was before 1980 because of the global demand in the global financial markets.”

    The Iraqi Central Bank denied reports by the media about the low reserves of gold, stressing that it saw stable over the past several months.
    He said in a statement yesterday he was “no truth to the news reported by some media on the low bank reserves of gold,” stressing that the reserves now total 29.790 tons.

    The International Monetary Fund (IMF) revealed in a report last week, said Iraq cut its gold reserves by a quarter to reach 29.9 tonnes in November 2012, pointing out that the reserves in September and October of last year reached 39.4 tons.

  2. #2
    Supporter and Investor! PennStateMtnMan's Avatar
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    A great article. The true question is when will it revalue?

  3. #3
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    Quote Originally Posted by PennStateMtnMan View Post
    A great article. The true question is when will it revalue?
    Good to see you posting PSMM! I like the article but you know how the wacky Iraqis define 'soon.'
    Last edited by dinar shore; 02-04-2013 at 04:27 AM.
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    THIS IS HUGH! , right Darock?
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  5. #5
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    So just out of curiosity what was the Dinar worth back in 1980?

  6. #6
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    Quote Originally Posted by shinerguy View Post
    So just out of curiosity what was the Dinar worth back in 1980?
    In 1980 the official dinar note rate was $3.1 to 1 dinar with 20 billion dinar in circulation and ~ 15% reserve. 3.1 X 20 billion = 62 billion in dinar. Add 15% reserve 1.15 X 62 billion and the dinar value was ~ $71.4 billion.

    Today the dinar note rate is $1 to 1167 dinar with 29,757 billion outside banks and 31,365 billion in reserve end of Dec 2012 for a total of 61,125 billion dinar. Divided by the dinar note rate 1167 (61,125 billion / 1167 = ~ $52.4 billion dollars. The dinar value of $71.4 billion in 1980 minus the dinar value of $52.4 billion in 2012 is a difference of $19 billion and at the present growth rate the dinar should reach the dinar value of $71.4 billion in 1980 in the next 1-3 years as the dinar is increasing in value at ~ the same rate as the GDP. The money supply has to be increased as the GDP grows.

    The exchange rate by itself has nothing to do with the value of the dinar. It only defines the value of a dinar note against a foreign exchange note.
    Last edited by Screaming Eagle; 02-04-2013 at 07:02 PM.
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  7. #7
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    Thanks for the insights, SE. So, does this speak to a reval in the next 1-3 years?

    Interested in hearing your thoughts.
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  8. #8
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    Quote Originally Posted by dinar_dude View Post
    Thanks for the insights, SE. So, does this speak to a reval in the next 1-3 years?

    Interested in hearing your thoughts.
    The rate does not have to change for a currency note to be revalued. The dinar note is pegged to the dollar at a rate of 1167. The dollar is traded on the free market and is constantly being revalued every day.

    You can check its value here: http://www.marketwatch.com/investing/index/dxy/charts

    Every time the dollar is revalued even the slightest bit so too is the dinar revalued as its rate is pegged to the dollar at 1167 dinar to $1.

    Therefore the dinar is being revalued every day. The evidence is the amount of inflation that takes place.
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  9. #9
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    So, if the Iraqis are going to raise the value of the dinar to previous levels, as it mentions in this post, they will have to float or unpeg the dinar from the dollar, and we're on easy street.

    Quote Originally Posted by Screaming Eagle View Post
    The rate does not have to change for a currency note to be revalued. The dinar note is pegged to the dollar at a rate of 1167. The dollar is traded on the free market and is constantly being revalued every day.

    You can check its value here: http://www.marketwatch.com/investing/index/dxy/charts

    Every time the dollar is revalued even the slightest bit so too is the dinar revalued as its rate is pegged to the dollar at 1167 dinar to $1.

    Therefore the dinar is being revalued every day. The evidence is the amount of inflation that takes place.
    "I have nothing to offer but blood, toil, tears and sweat." - Sir Winston Churchill

  10. #10
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    I am concerned with the amount of Dinar is out there. Prior to 1980, we were talking about billions, now we are talking trillions.

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