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Thread: How is Iraq going to pull this off?

  1. #1
    gankans
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    How is Iraq going to pull this off?

    How is Iraq is going to pull this off?

    Since 2003, Iraq and the CBI with the support of the UN, IMF, World Bank and many other nations have supported the redevelopment of this once great nation. I’m not to go into a long winded history of Iraq, but I will now show you in simple and factual analysis of some recent articles that just came out.

    In most recent post yesterday, I posted the recent news articles listed below.

    1. Iraq Expects to Step Up T-Bill Activity in 2010
    2. IMF: Iraq Letter of Intent (Memorandum of Economic & Financial Policies)

    I noticed obvious signs telling us (the patient investor) that we are in the edge of victory! Look at the following quotes from article #1 above.


    “Iraq also wants to promote the development of foreign exchange markets outside the framework of regular dollar auctions currently conducted by the Central Bank, including an interbank market and dinar forward market, the submission said.”

    “Amongst other things, the submission said Iraq’s central bank planned to create a foreign exchange market outside the framework of regular dollar auctions now conducted by the bank. The bank uses the auctions to set the exchange rate, which has been held at 1,170 dinars per dollar for many months.”
    “To improve the functioning of foreign exchange auctions, we plan to develop organized exchange markets outside the central bank, including an interbank foreign exchange market,” it said.
    “Our aim is to establish a forward market in Iraqi dinars in the near future.”

    Interjection: To develop “foreign exchange markets outside the framework of regular dollar auctions” is saying they are going to sell the Iraqi dinars on the open forex exchange. Did you notice the article also repeats itself three times explaining the exact same scenario! The worded this last quote (interbank foreign exchange market) a little differently at the end. What does this mean exactly? Well let’s look.

    The interbank market is the top-level foreign exchange market where banks exchange different currencies. The banks can either deal with one another directly, or through electronic brokering platforms. The Electronic Brokering Services (EBS) and Reuters Dealing 3000 Matching are the two competitors in the electronic brokering platform business and together connect over 1000 banks.

    The currencies of most developed countries have floating exchange rates. These currencies do not have fixed values but, rather, values that fluctuate relative to other currencies.


    Interjection: Notice that this is “the top-level” foreign exchange market! Notice that Reuters is one of the two EBS services that provides international exchange of currencies?! Reuters is the one that broke this story about the Iraqi dinar going international! Seeing a pattern? Also, notice that only “currencies of most developed countries have floating exchange rates”! Now why would Reuters decide to give Iraq or the CBI the opportunity to sell their currency on the open exchange market unless Iraq had the potential to be one of the richest exchanges?!

    The interbank market is an important segment of the foreign exchange market. It is a wholesale market through which most currency transactions are channeled. It is mainly used for trading among bankers. The 3 main constituents of the interbank market are the interbank market is unregulated and decentralized. There is no specific location or exchange where these currency transactions take place. However, foreign currency options are regulated in the United States and trade on the Philadelphia Stock Exchange. Further, in the U.S., the Federal Reserve Bank publishes closing spot prices on a daily basis.

    Interjection: Did you notice that the currency now be “unregulated and decentralized”? It means that anyone anywhere can trade the Iraqi dinar. This is why you can go onto any forex website and open up a account soon and trade the dinar.

    Can you imagine what’s going to happen?! When they decide to open this on the interbank market, every currency investor around the world will be chomping at the bit! They will want to take instant advantage of the 100% -300% gains on their millions or billions of dollars!

    Example: Let’s say the trading floor opens up at .86 cents. I’m assuming they will start lower so more people will want to buy it up. Plus if they start lower more people will not only buy, but this will help Iraq to cover the dinars that others will be exchanging in at what we all bought it at (.0008).
    Smooth… right? Iraq or CBI are covering all their basis. Also keep in mind that you don’t want to promote your product (currency) to low and have people think it isn’t a good investment. Perception plays a key part in selling anything. But believe this my friend, CBI already has let Reuters inside their little financial data word that shows everyone how well they are doing economically, financially, and their future potential.

    Most everyone (UAE, U.S. China, and other invested countries) already knew the big plan a long time ago. Why would all these countries that Iraq owes billions to eliminate their debt, unless they knew something? Hhhmmm???


    “Our aim is to establish a forward market in Iraqi dinars in the near future.”

    Interjection: CBI can’t wait very much longer. If Reuters broke this story, then every investor in the world is now ringing CBI’s phone off the hook taking orders (purchasing Iraqi dinar)! It will happen in the next few days or the CBI will stop all sales until they figure out when the want to release their currency to the open market.

    I hope this all makes sense. I happier than little kid in a booger flicking contest! :-) I can honestly say that this "action plan" is as good if not better than RV folks. This is what we have been waiting for! Just sit back and enjoy the ride. It will happen very very soon! Thank God! Really!

    Gankans

  2. #2
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    Thanks for the post. This is a very interesting analysis.

  3. #3
    wrebiejo
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    Thanks for the analysis, this is very exciting.

  4. #4
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    Thanks for the great info Gankans!!!! Had to come home just to read it.

  5. #5
    gankans
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    Quote Originally Posted by chuksan View Post
    Thanks for the great info Gankans!!!! Had to come home just to read it.
    You're to nice. I can't wait to talk to people tonight. This should help.

  6. #6
    gankans
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    This is the link to the original news article from Reuters.com

    http://www.reuters.com/article/idUSLDE6292F520100310

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    wow and wow. I have to admit, Iraq is really being ingenious in this process. The floating idea is a win win for everyone involved. Very ingenious

    thanks Gankans great job as usual

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    Cool

    Thank you, winston

  9. #9
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    Great post gankans, thank you for yor analysis!

  10. #10
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    Gankans .. what, IYO does this mean for the average investor like most of us?

    If the initial rate comes in low, say $<, I would assume many investors will exchange what they need to sustain themselves and hold the rest, well knowing that the market will run with this and cash in the remainder around $3 or more ..

    Now, if they come in at a more reasonable rate around, $2, I would guess most like me will exchange and run, never wanting to see the word Dinar again. So yes, it will be very interesting to see what the CBI does for an initial rate. It could make or break what they have going IMO.

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