Iraqi Dinar investments

[aj9088]

"Saddam ran the country into the ground and destroyed the infrastruture,"


that is just blatently false...if u are going to post about something, at least have a cursory knowledge of what u are talking about....

it was the WAR that did what u state above, not saddams policies...under his policies, iraq was probably doing better economically than most arab nations and their rates of illiteracy went way down and their health care system provided for the needs of most of its population...

saddam was a brutal dictator, obviously, but it was NOT his policies that made iraq into what it is today, but rather the ruthless, brutal and illegal USA invasion that did the trick....

heres hoping to the dinar gaining lots of strength!

[pRo TrAdeR]

Now you do not know what you are talking about. It was not USA's fault or the war. Saddam was brutally attacking his own people. If it was not for the USA's interference, there would be chaos in Iraq and Saddam would have produced a nuclear weapon by now. If anything, the US stopped a problem before it got seriously out of hand.

[payroll]

Copied from xe.com Universal Currency Converter:

Overview

A number of people have begun touting so-called "investment" opportunities in the Iraq Dinar as a "sure way" to make a lot of money with little or no risk. Many of our clients have asked our opinion on the legitimacy of this.

Is "investing" in the Iraq Dinar a sure way to profit? We don't think so. In our opinion, buying the Iraq Dinar is a high risk investment with a poor outlook.

A Little History

The official rate of the old Iraq Dinar, $3.22 USD (U.S. Dollars), was set in 1982 by Saddam Hussein. The old Iraq Dinar could not be freely traded, so this rate was never tested or upheld on the world market.

The current Iraq Dinar (IQD) was introduced between October 2003 and January 2004 by the Coalition Provisional Authority in close consultation with financial experts from Iraq and the international community. The IQD is currently valued at a little less than seven hundredths of a US cent. (1 USD = 1460 IQD). The old "Saddam" Dinar has no current value and is worth only what a collector is willing to pay for it.

What's Happening Now?

The IQD is not freely traded, and is not being used in any significant international transactions. We are unaware of any official bank or foreign exchange office outside of the middle east that will exchange the IQD.

The IQD trades on a very small, tightly controlled exchange. The total volume of IQD traded by the Central Bank of Iraq is in the thousands of dollars, compared to the $1,900 billion dollars traded on the Foreign exchange market every day. This small number of trades makes the IQD's value effectively immaterial.

The Central Bank of Iraq's stated objective is not to promote the free trade of IQD, as is the case in a true free market economy, but rather to keep the value of the IQD stable. The only way the Bank can ensure the semblance of stability is by tightly controlling the exchange of IQD on the market, and by ensuring that the currency cannot freely trade on the open market. They evidently fear that open trading of the IQD would lead to a rout in which the value of the IQD would sink to practically nothing.

Consider the situation. Why tightly control the trading of the IQD if it is likely to appreciate in value? If the value of the IQD were to surge, this could be held out as evidence of a surge of confidence in Iraq's economy. So why not open the IQD to free trading? Why would this be done unless the Iraqi Central Bank itself feels that the IQD would decline in value in a free market?

A Snapshot of Iraq Today

The current situation in Iraq is pretty grim:

Over a decade of international economic sanctions and a devastating war has left the infrastructure in tatters
$125 billion of external debt
Millions of dollars in post-war debt
No stable government
Insurgency steadily on the rise
Oil facilities and pipelines are sabotaged regularly
Many predict out-and-out civil war, such as the former Prime Minister of Iraq and the outgoing UK abmassador in Baghdad
These aren't the kind of conditions typically conducive to the creation of booming economies. More to the point -- a 450,000% increase in the value of the IQD (as predicted by some of its promoters) seems ridiculous in the face of these challenges.

But Surely There's Oil Under Those Dunes?

A lot of the hype over the IQD centers around Iraq's vast oil reserves and their supposed economic value. The oil market is extremely unpredictable. An economy based on oil alone (oil makes up 95% of Iraq's foreign exchange earnings), will mirror that unpredictability. Let's look at a real-world example: Venezuela.

Oil accounts for 80% of Venezuela's national exports and 50% of its government revenues. The country is one of the world's top five oil producers. In the last four years, Venezuela has experienced intense political instability, including an oil strike and an attempted coup d'état. The resulting economic chaos has led to the extreme devaluation of the Venezuelan Bolivar -- today, it is worth only about a third of its US Dollar value from January 2000, and only about a quarter of its Euro value from January 2000.

Investing in a country's currency is tantamount to investing in that country's economy as a whole, not in any single commodity. Investing in the Iraq Dinar is not the same as investing in Iraq's oil.

But What About Kuwait?

Promoters of the IQD like to compare Iraq now to post-Gulf War Kuwait -- but this is comparing apples to oranges.

Before the Gulf War, Kuwait had a stable government and its foreign investments generated more income for its economy than its oil did. After the war, despite losing a third of its pre-war investment portfolio (over $100 billion USD), Kuwait still had a solvent economy, a stable government, and an intact infrastructure. It is not difficult to see why a currency's value might increase in these circumstances.

In comparison, Iraq entered the war with a $125 billion USD debt, has almost no infrastructure, no stable government, and no other foreign income except its oil -- the vulnerability and unpredictability of which we have already pointed out. The outlook for its economy and the IQD is grim for the foreseeable future.

In late 2004, the US was successful in convincing some foreign creditors to "forgive" some of Iraq's debt. However, debt forgiveness is seldom a blessing, and generally comes at a very heavy price. Other countries whose foreign debts have been "forgiven" have found it nearly impossible to generate any foreign investment afterwards. Think about it: how would you feel about investing in Iraq again if you lost your entire investment (i.e. you "forgave" it) last time?

If it Sounds Too Good to be True...

Ask yourself one question: if the Iraq Dinar is such a hot commodity, why would anyone in the know be willing to sell it to you? If you thought that the IQD was going to multiply in worth by hundreds of thousands of percent, would you sell it? Of course not -- you'd be too busy buying as much of it as you could.

But if you thought that the IQD was going to go down in value over time, well, then you might start trying to convince people that it was a "great deal" so that you could get rid of all of yours as soon as possible.

Remember the old saying: if it sounds too good to be true, it probably is. Be careful!

[VagaryViews]

And 2 nuclear bombs once hit Japan, leaving it***8217;s mark in devastation and ruin.
Reconstruction then happened.

If history has taught us anything; it would be no matter how bad this world is now, nothing compares to the tragedy of the past.
Really think hard about all that has past. You would be hard pressed to disagree.

[VagaryViews]

By the way, I don***8217;t know what fly-by-night places everyone is buying their Dinar from. I buy mine from a securities firm.
I believe that the Iraqi Dinar will be worth around $.20 -.30 on the US dollar in 5 years. Gains can be substantial if you've invested at low cost.

[jsfletcher]

Originally Posted by payroll

Copied from xe.com Universal Currency Converter:

Overview

A number of people have begun touting so-called "investment" opportunities in the Iraq Dinar as a "sure way" to make a lot of money with little or no risk. Many of our clients have asked our opinion on the legitimacy of this.

Is "investing" in the Iraq Dinar a sure way to profit? We don't think so. In our opinion, buying the Iraq Dinar is a high risk investment with a poor outlook.

A Little History

The official rate of the old Iraq Dinar, $3.22 USD (U.S. Dollars), was set in 1982 by Saddam Hussein. The old Iraq Dinar could not be freely traded, so this rate was never tested or upheld on the world market.

The current Iraq Dinar (IQD) was introduced between October 2003 and January 2004 by the Coalition Provisional Authority in close consultation with financial experts from Iraq and the international community. The IQD is currently valued at a little less than seven hundredths of a US cent. (1 USD = 1460 IQD). The old "Saddam" Dinar has no current value and is worth only what a collector is willing to pay for it.

What's Happening Now?

The IQD is not freely traded, and is not being used in any significant international transactions. We are unaware of any official bank or foreign exchange office outside of the middle east that will exchange the IQD.try any chase bank in the US

The IQD trades on a very small, tightly controlled exchange. The total volume of IQD traded by the Central Bank of Iraq is in the thousands of dollars, compared to the $1,900 billion dollars traded on the Foreign exchange market every day. This small number of trades makes the IQD's value effectively immaterial.

The Central Bank of Iraq's stated objective is not to promote the free trade of IQD, as is the case in a true free market economy, but rather to keep the value of the IQD stable. The only way the Bank can ensure the semblance of stability is by tightly controlling the exchange of IQD on the market, and by ensuring that the currency cannot freely trade on the open market. They evidently fear that open trading of the IQD would lead to a rout in which the value of the IQD would sink to practically nothing.

Consider the situation. Why tightly control the trading of the IQD if it is likely to appreciate in value? If the value of the IQD were to surge, this could be held out as evidence of a surge of confidence in Iraq's economy. So why not open the IQD to free trading? Why would this be done unless the Iraqi Central Bank itself feels that the IQD would decline in value in a free market?

A Snapshot of Iraq Today

The current situation in Iraq is pretty grim:

Over a decade of international economic sanctions and a devastating war has left the infrastructure in tatters
$125 billion of external debt forgiven
Millions of dollars in post-war debt forgiven
No stable government
Insurgency steadily on the rise
Oil facilities and pipelines are sabotaged regularly
Many predict out-and-out civil war, such as the former Prime Minister of Iraq and the outgoing UK abmassador in Baghdad
These aren't the kind of conditions typically conducive to the creation of booming economies. More to the point -- a 450,000% increase in the value of the IQD (as predicted by some of its promoters) seems ridiculous in the face of these challenges.

But Surely There's Oil Under Those Dunes?

A lot of the hype over the IQD centers around Iraq's vast oil reserves and their supposed economic value. The oil market is extremely unpredictable. An economy based on oil alone (oil makes up 95% of Iraq's foreign exchange earnings), will mirror that unpredictability. Let's look at a real-world example: Venezuela.

Oil accounts for 80% of Venezuela's national exports and 50% of its government revenues. The country is one of the world's top five oil producers. In the last four years, Venezuela has experienced intense political instability, including an oil strike and an attempted coup d'état. The resulting economic chaos has led to the extreme devaluation of the Venezuelan Bolivar -- today, it is worth only about a third of its US Dollar value from January 2000, and only about a quarter of its Euro value from January 2000.

Investing in a country's currency is tantamount to investing in that country's economy as a whole, not in any single commodity. Investing in the Iraq Dinar is not the same as investing in Iraq's oil.

But What About Kuwait?

Promoters of the IQD like to compare Iraq now to post-Gulf War Kuwait -- but this is comparing apples to oranges.

Before the Gulf War, Kuwait had a stable government and its foreign investments generated more income for its economy than its oil did. After the war, despite losing a third of its pre-war investment portfolio (over $100 billion USD), Kuwait still had a solvent economy, a stable government, and an intact infrastructure. It is not difficult to see why a currency's value might increase in these circumstances.

In comparison, Iraq entered the war with a $125 billion USD debt, has almost no infrastructure, no stable government, and no other foreign income except its oil -- the vulnerability and unpredictability of which we have already pointed out. The outlook for its economy and the IQD is grim for the foreseeable future.

In late 2004, the US was successful in convincing some foreign creditors to "forgive" some of Iraq's debt. However, debt forgiveness is seldom a blessing, and generally comes at a very heavy price. Other countries whose foreign debts have been "forgiven" have found it nearly impossible to generate any foreign investment afterwards. Think about it: how would you feel about investing in Iraq again if you lost your entire investment (i.e. you "forgave" it) last time?

If it Sounds Too Good to be True...

Ask yourself one question: if the Iraq Dinar is such a hot commodity, why would anyone in the know be willing to sell it to you? If you thought that the IQD was going to multiply in worth by hundreds of thousands of percent, would you sell it? Of course not -- you'd be too busy buying as much of it as you could.

But if you thought that the IQD was going to go down in value over time, well, then you might start trying to convince people that it was a "great deal" so that you could get rid of all of yours as soon as possible.

Remember the old saying: if it sounds too good to be true, it probably is. Be careful!

I was going to go on, but it's really not worth the response

[ArizonaInvestor]

That sounds like my mother's version of "Oh Poo."

You trade US Dollars daily for merchandise and services. Why would another currency be any different.

[VagaryViews]

Every country has debt probably other than those with hypercharged economies like Brazil and Luxemburg; just to name a few.
However, being in debt doesn***8217;t necessarily make one***8217;s currency plummet.

The Dinar is slowly rising in value, slowly. Even if their currency only makes a small change forever, I won***8217;t loose out on the few hundreds of dollars I spent for millions of dinar.
And if local banks are beginning to make exchanges, you***8217;ll probably be able to change your money back easily, just have to wait some time.

Not to mention, check out the stats for yourself here
http://wwp.greenwichmeantime.com/tim...q/currency.htm
You never know what tomorrow brings especially when dealing with economy.

[Accontant]

Originally Posted by VagaryViews

And 2 nuclear bombs once hit Japan, leaving it’s mark in devastation and ruin.
Reconstruction then happened.

If history has taught us anything; it would be no matter how bad this world is now, nothing compares to the tragedy of the past.
Really think hard about all that has past. You would be hard pressed to disagree.

I'd just like to mention that the atomic bombs damage wasn't in itself that big a deal in relation to the total damage inflicted in WWII, Dresden, Berlin, Munich and Stettin to name just a few were damaged at least as much as Hiroshima and Nagasaki, as were Tokyo and Kobe in Japan, the difference being it took fleets of bombers to destroy those cities, not just a single bomb. It should also be noted that the economies of Germany (west) and Japan didn't fully recover for over 20 years. I can remember seeing piles of WWII rubble in Germany in the 70s, and this inclusive of what would today be aid in the trillions of US$.
I'm a naysayer on the sudden and explosive re-valuation of the Dinar, but I have said all along that it is a decent, if risky investment. It has made somewhere in the range of 10% in the last year and that's a very decent return, but hte people who spent $750 and expect it to be worth a Million Dollars anytime soon are dreaming.

[Accontant]

Originally Posted by ArizonaInvestor

That sounds like my mother's version of "Oh Poo."

You trade US Dollars daily for merchandise and services. Why would another currency be any different.

Um, because I'm pretty certain that the US Government will not be toppled in the next 6 months, something I can't say about Iraq.