Dinar Observer Daily

Samson – Dinar Guru  Article:  “AFTER TWO DECADES OF STAGNATION, THE OIL AND GAS LAW HAS A CHANCE TO BE RESOLVED“

Jeff – Dinar Guru   They’re now ready to send the Oil and Gas law to parliament for approval.  This thing’s waited to clear since 2005/07 for the rate to have changed to do this.  It’s all coming together now at the same time around the middle of September…They pretty much have given you a back wall for the rate to have changed by September 30th.

Stephen – Dinar Guru The reason why the dinar has such the potential it does to be a truly life transforming wealth event is because of the negativity surrounding it…There’s a reason why people think dinar investors are nuts…If this investment didn’t have a high risk nature behind it, it would not yield the benefits and the returns we are all expecting, hoping and praying  for…If this was a guaranteed hole-in-one investment, everyone and their mother would be invested in it and it wouldn’t exist.

Mountain Goat – Dinar Guru  Article:  “SMALL BANKNOTE SHORTAGE CAUSES DAILY DISRUPTION IN KIRKUK MARKETS”  As this liquidity crisis worsens, the pressure builds to do something and do it soon...remember conducting this project of removing the zeros also means moving to FOREX soon afterwards…We are told the Trump administration and the IMF now want the reinstatement and so it is supporting the next move too. 

Jeff – Dinar Guru  Question: “What is the argument against a managed float?”  It can’t float. The budget is calculated off of a fixed currency value.  That’s the reason it can’t float.  If the value of the currency was to change by 20% or more the budget would have to be re-amended and re-approved with new calculations.  They’re not going to keep amending and re- approving the damn budget over and over to do a float.

Stephen -Dinar Guru  I’ve been holding on for 15 years and I can finally see the light at the end of the tunnel.  There’s a lot getting done.  The last 6 months have been absolutely revolutionary.  We are in a period of acceleration.  The only way you would not be able to see that is if you have blinders on.  It’s exciting times that’s for sure…

David – Dinar Guru  The sovereignty of Iraq comes down to one simple thing – control over their social order and peace in their country.  No one wants to handle their business on a day-to-day basis…The United States and the rest of the coalition and the banking system do not want to expend any more treasure or blood or time over Iraq.  The want Iraq to be self-sufficient.   That’s what sovereignty means.  

Militia Man – Dinar Guru  A REER adjustment is a managed change in what the dinar is really worth against the currencies Iraq trades with…It’s not printing [additional notes].  It’s not knocking zeros off a note.  It’s not a lottery  ticket…The official nominal rate – The central bank posts how many dinars buys $1.00…When people say, ‘They moved the rate’  that is the lever they pull.  

Reset Intelligence – Dinar Guru  [Iraq’s] Cabinet amended its own Decision 348 to authorize the Oil Ministry to sign three agreements with Chevron: an advance payment arrangement, a crude supply deal, and a technical consulting contract…Dollars now. Barrels later. Trust, in writing.  There is an old rule in commodity finance, and it has never had an exception…: you prepay only the supplier you trust to deliver. Nobody wires money up front to a country whose books they cannot read, whose banks they cannot trace, whose cargo might never clear a port. For 20 years that country was Iraq. So today we...look at what it means when the most careful money in the oil business decides Baghdad is safe to pay in advance. Because that decision landed 6 days before the document that should price the new dinar into law.

Sandy Ingram – Dinar Guru  Finance Committee discussions with the central banks’ governor include three subjects: printing new currency, deleting the zeros and introducing new denominations…A finance committee member reportedly said there is discussion about introducing currency denominations smaller than Iraq’s existing 250 dinar note…This does not mean Iraq has approved a 100-dinar…50-dinar…25-dinar notes or any small denominations are about to be released.  At this point no values below 250 dinars have been officially announced and there has been no official announcement that these smaller denominations have been approved for circulation.

Jeff – Dinar Guru   The HCL was drafted but never sent to parliament for approval clear back in 2007 and has been pending ever since because it’s been waiting the entire time for the rate to change.

Stephen – Dinar Guru  [My contact in Iraq update]  STEPHEN: Are citizens excited?  Are they aware what’s going on?  IRAQI CONTACT: Right now all the focus is on September 30th.  That’s all the people are talking about. STEPHEN:  That’s the date the US military is supposed to leave and Iraq is supposed to regain its full sovereignty.  Why is that so important to the citizens?  IRAQI CONTACT:  It’s the date that will make or break the government.  All the militias have to hand over their weapons on or before this date…Most of them…refused to hand over those weapons.  The government has already implied they might be clashing with those militias if they refuse to do so…Iran is pushing them to stay…Zaidi is powerless. He has no one to back him up.  This parliament mostly consists of militia affiliated members or supporters.  STEPHEN:  Do you think they will increase the exchange rate soon?  IRAQI CONTACT:  We have to wait until September 30th… STEPHEN:  When we get to the 30th of September, they’re not going to fail.  That’s not going to happen.

Mountain Goat – Dinar Guru   …I have to say the news just keeps getting better and better…When can we expect the CBI to make a decision on their move of removing the zeros? This should happen any day now. One day you will read it…and this is not too far off. I was told by my CBI contact that a committee has been set up months ago to study the issue of the feasibility of coming up with a start date… a draft law was already sent to parliament on this effort to review and pass so they can begin the  process...this project to remove the zeros…is moving ahead…to an advanced stage of…determining a date to begin and then announcing it to the public. 

Sandy Ingram – Dinar Guru   There is no official announcement saying deleting the zeros would increase the real  purchasing value of the Iraqi dinar. 

Reset Intelligence – Dinar Guru  Iraq’s Parliamentary Finance Committee says it wants to print a banknote smaller than the 250-dinar note. At the official rate of 1,310 to the dollar, a 250 note is worth about 19 US cents, and anything under it is worth pennies. No state prints paper that costs more to make than it is worth. It prints small change only for a currency it expects to be worth far more than it is today.

Stephen – Dinar Guru They’re all saying different things…You can’t always take Iraq or the CBI at face value of what they say because they constantly contradict themselves.  I would expect that especially as we near any type of significant rate change or any type of redenomination.  They’re not going to tell you exactly what they’re doing.  They’re not going to give dates…because if they did it would be extremely detrimental to…the last 20 years of controlled monetary policy…It makes sense.

Jeff – Dinar Guru  The odds are the rate will change before you and I even know what the heck even happened…For most of us the rate would have already changed and we would have exited out before we witness what the heck happened or how it played out.

Militia Man – Dinar Guru  Printing more dinars to cover salaries is not a rate move.  It’s more local cash against the same pile of dollars.  It usually means a weaker dinar and higher prices.  Deleting zeros is not a richer country.  It’s new notes with the same value…It makes ease-of-use but it’s not going to make a stronger economy…A REER adjustment is the official rate…matching the real economy…An “adjustment” means correct the misalignment…The Effective rate – Iraq does not only trade with the United States.  It buys and sell with Turkey, China, the Gulf, Europe, Iran and others.  The effective rate weights those partners by trade share.

Sandy Ingram – Dinar Guru The governor of the Central Bank of Iraq has now publicly addressed the issue of changing Iraq’s currency and deleting the zeros…There appears to be two separate issues being discussed.  1) According to the governor, changing the currency falls under the authority of the Central Bank of Iraq.  2) According to the governor deleting the zeros…would require legislation from Iraq’s parliament…It means the central bank may have the authority to redesign, replace or print currency.  But if Iraq actually wants to move forward with deleting the zeros…parliament would have to become involved…If we eventually see…formal legislation proposal dealing with the deletion of the zeros submitted…that could represent a much more significant step than the discussions and statements we have been following.  

Reset Intelligence – Dinar Guru   Today the [currency] operation met its first stress test…A currency change over has one weak point.  Forget the printing, paperwork and parliament.  The weak point is the morning every citizen decides whether to walk toward a [bank] counter or away from it…The [banking] rails depends on millions of Iraqis voluntarily walking what they hold into a bank.  A public that runs from banks does not walk into them holding their life savings.  Sunday a few hundred Iraqis queued to take their money out and the state’s answer was already on the record…a written guarantee…a named-deposit insurer…The day the real announcement lands, all of Iraq becomes a queue outside a bank. This week was the rehearsal for how the state treats a queue… [Post 1 of 2]

Reset Intelligence – Dinar Guru  Iraq faced its first bank run of the cleanup…Depositors crowded the doors of Al-Taif Islamic Bank in Baghdad demanding their money back. One woman told reporters she has 220 million dinars locked inside, about $168,000. A second crowd formed at the bank’s Basra branch. Iraqi social media called it the start of a collapse…The state saw it coming. The day before the crowd reached the door, the Central Bank of Iraq published a written guarantee of the country’s deposits…A run on the banks is the one event a currency operation cannot survive. So today we set aside the missiles and the ministers for a moment and look at how Iraq handled its first one.  [Post 2 of 2]

Stephen – Dinar Guru  Article:  “Central Bank Governor: As of today there are no international sanctions on the Iraqi banking sector”  Can you say internationally accepted currency, internationally traded currency!?  Ding, ding, ding.  This article is critical…We now have an official CBI statement that gives the broader banking reform context…This is confirming restrictions and sanctions have been lifted.  Iraq can begin to function and operate on a global scale on the international stage which is something we have always needed to see.  This is very very exciting.

Stephen – Dinar Guru  The truth is most employees at the banks don’t have a clue…I love my brother-in-law.  I’m not taking a dig at him, but he is a branch manager out of Wells Fargo, and he knows nothing about the Iraqi dinar.  When I mentioned it to him the first time he didn’t know anything about it.  And after…I was trying to get him to find out some information and he’s like, no, I think it’s dumb and it makes zero sense…Most people are clueless guys.  It is what it is.  Most bank employees, whether it’s a branch manager, wealth manager, tellers are clueless when it comes to this.  They’re just doing business as usual in their place of business…I thought this was very very fascinating the fact that we have physical proof, a photo, that the IQD is programed on the Delarue machine.

Clare – Dinar Guru  Article: “The Finance Committee confirms that the Central Bank intends to print new banknotes in denominations lower than 250 Iraqi dinars”  Quote: “He explained that the governor differentiated between changing the currency and removing zeros. He added that changing the currency is one of the exclusive powers of the bank, while removing zeros requires a law from the House of Representatives at the request of the government. He pointed out that the new printing will be followed by a period to withdraw the old, but the duration has not yet been determined.“

Reset Intelligence – Dinar Guru   When the rate is live, go to the private-client side of a large institution, not a retail branch. Chase Private Client opens near $150,000 in combined balances. UBS from roughly $2 million to $5 million; JPMorgan and Goldman near $10 million.  The first words: you are anticipating a significant liquidity event and want to establish the relationship in advance. Run 2 or 3 institutions in parallel so no single desk knows it is your only option.

Samson – Dinar Guru  Article: “CENTRAL BANK GOVERNOR : CHANGING THE CURRENCY IS WITHIN OUR AUTHORITY, AND REMOVING  ZEROS REQUIRES LEGISLATION IN PARLIAMENT”

David – Dinar Guru  It’s big. If you need proof go back to World War I, World War II, Korea, Iraq and eventually Venezuela  and you’re going to see a pattern.  We sanctioned them, there was conflict, we entered their country, we took their gold, we helped  them restructure their economy, financial system and monetary system and  helped them revalue their currency.  What’s happened in  Iraq?  We sanctioned them, engaged in conflict with them, defeated the Saddam forces…took their gold in 2003, destroyed their  infrastructure and daily life and helped rebuild their country and modernize their infrastructure, economic, monetary, financial  reforms.  And we’re helping them revalue their currency.

Sandy Ingram – Dinar Guru   The Untied States just sanctioned a Turkish bank accused of providing Iran with a critical financial lifeline.  Could Iraqi banks be next?  The answer is yes…Reuters recently reported Iraq could become an example of how America pressures countries that continue doing business with Iran…Iraqi banks, businesses, officials or financial networks believed to be helping Iran could potentially become targets and that matters to IQD investors because Iraq needs access to international banking systems.

Clare – Dinar Guru  Article: “Central Bank Governor: Changing the currency is within our authority, and removing zeros requires legislation in Parliament”  Quote:  “The process of reforming the banking sector is continuing in coordination with Oliver Wyman,” indicating that “there are no longer any sanctions from international bodies on the banking sector… international  confidence in the Central Bank is very high“

Reset Intelligence – Dinar Guru  Smaller Notes Only Mean One Thing. A note smaller than 250 dinars is worthless at today’s rate. A state prints one only when it knows the rate is about to change...Baghdad intends to print a banknote that makes no sense at today’s rate. Smaller than the 250-dinar note. Below the smallest note Iraqis carry.  At the official rate of 1,310 to the dollar, a 250 note is worth about 19 US cents…A 100-dinar note buys 7 cents. A 50 buys under 4…No government on earth prints paper pennies. The ink alone runs dearer than that. The note would lose money…A state orders a small denomination for one reason: because each unit is about to buy something. You do not mint it for the dinar as it trades today. You mint it for the dinar you have decided to bring back.