Dinar Observer Daily

Adam Montana – Dinar Guru   Oil saw a nice upward spike yesterday. We’re not quite to $60, but the trend is still positive. I expect it to pull back a tiny smidge, then continue the steady pace in this direction…I’m not saying “the day OIL hits $60, we will have an RV”!  $60 was the direction I wanted to see, and we’re basically there. As long as the current trend continues, we are in the (green) zone.  Steady and controlled oil prices, + steady and stable GOI, + some HCL goodies…that’s what we’re looking for, and it keeps coming!   [post 1 of 3….stay tuned]

Mountain Goat – Dinar Guru   So far, no voting in parliament on the last 4 ministers. Saturdays promised voting was not completed and postponed yet again. However no new date was confirmed or announce right away. Article quote:  “The candidate of the Minister of the Interior has not been agreed upon so far, but Fayadh officially withdrew his candidacy.”   So another article says that the PM is now able to put his own selection of candidates forward and vote on them. We are told they plan to try again in Thursday 3/21. 

Kaperoni – Dinar Guru    …an article that said they would not float the dinar…could be interpreted in two ways. 1. being they won’t float (which makes no sense because they then would not have the tool they need to counter inflation as investment/investors come to Iraq, or    2. they are not going to float at this time (which may be what they really meant at the time of the article).  And may be true…but that was months ago before the dinar was stable and in compliance…

Mountain Goat – Dinar Guru    I can say that I have heard many rumors about the readiness for the launching of the new smaller category notes, however you would think that, if these rumors where true, we would see multiple articles on this topic in the general Iraqi news media prior to the event. We have NOT yet seen this. But also remember this does not mean this even may not be on the radar for the very near future either as we also know these smaller category notes may come in close proximity to the announcement of a reinstatement.

EHankins – Dinar Guru  Education for and to the citizens on the Nasdaq billboard… this must not fail. This is a perfect opportunity for them to learn…they are IMO. WE KNOW THIS… have known this for a long long time.  CBI bring it… we are way past the RI… you can pull the trigger any time now.

Larrykn – Dinar Guru    […do you guys know when they will finish the remaining 4 cabinets?]    …parliament meets tomorrow , we shall see what happens then.

Larrykn – Dinar Guru   Article quote: “Breaking   The IMIS candidate for the interior ministry in Adil Abdel al-Mahdi’s cabinet, Falih al-Fayyadh has officially withdrawn his candidacy bid…”  this might open the door to complete the cabinet.

Kaperoni – Dinar Guru   There are two ways to interpret what the CBI is talking about when they mention “deletion of zeros. It may be honest and part of the plan (when they interpretation of what they really mean applies) or it may simply be the CBI trying to diffuse speculation and speculators from buying the dinar. There is no way to know for sure until they open the economy and we find out.  I have read articles that imply deleting 3 zeros is a LOP and others that imply that they will raise the value gradually down to the day the dinar is worth the same as the dollar…which implies a float and exchange rate improvement.  Personally, I believe from my research the dinar will improve in value via float and that seems to coincide with Dr. Bakri in Iraq who has written me several times to discuss monetary policy…   [post 3 of 3]

Kaperoni – Dinar Guru   As for how fast the dinar could rise…just look back at 2004-2005 when the CBI  under Dr. Shabibi unpegged for about 6 months and reduced inflation from about 33% to 5% or less raising the dinar exchange rate from near 3000 / $1 to 1170 /$1. This demonstrates the pace the dinar once again could have during the investment/market economy phase. But again, this process is up to how fast investors/investment comes to Iraq. It is not a random act. Again, many articles on this process to read from the IMF and other organization.   …Remember this is not some idea I came up with. The professionals at the IMF that work directly with Iraq have documented that is their intention for the CBI and the dinar. [post 2 of 3]

Kaperoni – Dinar Guru   Many think the dinar could never free float and must be some sort of manage float. They may be right!   I …do not really care what type of float it is other than that is how monetary policy works, floats are a tool that the CBI uses to counter pressure.Random acts like RV’s RI’s etc are not tools the CBI uses so we can rule such an event out. As well there are other reasons like money supply, economic shock that prevent such an event from ever happening.  If they do float (which they will) the float will begin at whatever the current rate is at..such as 1190. The reason is simple…any other value would be a RV of sorts and not be within the tools the CBI uses. Not to mention, it would circumvent the CBI’s ability to profit from the buy/sell of currency commissions. Which after all, is what the CBI is in the business of…making money. Central banks every single day control the sale of their currency to make money. [post 1 of 3]

Larrykn – Dinar Guru   I think that fact that they are opening the ATM, is good, I think they can reduce the note count when they pay salaries thru the ATM and use the visa cards. 

Mountain Goat – Dinar Guru   So the parliamentary session was held on Saturday. The big question is – Did they vote on the remaining 4 ministers?  NO voting was conducted as promised would happen. Go figure…This is very important because we know that there has always been a long-standing mandate to have a fully completed government prior to any reinstatement of the currency for Iraq.  We know that much has been accomplished in the form of banking and currency reforms. It is believed that now any holdup in the reinstatement is purely political and so we wait.

Larrykn – Dinar Guru      Article:  “The Cabinet issued a directive for international institutions and funding on borrowing”  This sounds like they are trying to get a handle of corruption, no loans without their approval…if they don’t…we don’t see what we want.   …corruption, stability and banking are three things they need to get done…they are working on all three but it does take time, plus laws they need to pass…not until lately have they real done any of these things. For years its been all talk no action.

Larrykn – Dinar Guru  There were articles back in 2013 that Iraq was testing rates around $1.13 to 1. 20. Why would they do that if they were going to start at 1190?

MilitiaMan – Dinar Guru   …Then…the Launch of the electronic signature next week. Well that is for speed and security in the movement of capital. Safe, secure and fast. So what we are seeing is the advance stage of implementation of the MR (monetary reform) and ER (economic reforms) for iraq. Linking with NASDAQ, takes an internationally accepted currency. They won’t go live on an international level playing field with a non compliant program rate. They’ll need to expose the 2019 budget and apply the adjustment to redeem the new calculations for to be traded on Forex and for the ISX to Trade on the NASDAQ platform along side regional players, like in Dubai, etc..imo.  [post 2 of 2]

MilitiaMan – Dinar Guru  Articles:   “NASDAQ in New York City to raise the name and logo of the Iraqi market for securities“;   “Communications: Launch of electronic signature next week”   The above data is effectively telling us a few things. Firstly they appear that they are to begin trading with in the parameters of the NASDAQ, and is noted to be an historic event told to the world at the closing bell of the markets in the USA.  …They speak of electronic systems, networks and the speed of capital movement.  Well to get those things, economic activities have to have modernized systems in place. They clearly have them and the ability to interconnect with them globally. [post 1 of 2]

Mountain Goat – Dinar Guru   I…heard some ridiculous chatter about a LOP…If there was going to be LOP they would have already done it and not be sending out countless articles on the project to delete the zeros and valuation strategies. …a LOP is not possible. Not in my terms but from FACTS from the CBI itself.

Mountain Goat – Dinar Guru   There was a recent news article stating that 80% of all Iraqis still do not have electronic banking and bank accounts. …this simply is NOT the case. If this was the case the CBI could not have already satisfied its goal of reducing the on street three zero note supply by more than 2/3 down to just over 41 trillion dinars. How many times have they told us the original count of dinars printed and issued in 2003 and now in 2019? So we confirmed many times that this statement of 80% is a lie and impractical. My recommendation to everyone is to relax and wait for the reinstatement in the coming period. No one will know the exact time or date but we do know many things effecting these two parameters and so we can almost figure it out. We are now in the window and I do not see the window closing.   [post 2 of 2]

Mountain Goat – Dinar Guru   The news today is all about the upcoming expectations to vote on the remaining last four ministers. We have to remember that a long-standing condition to reinstate the currency of Iraq is to have a “fully” formed government. This does not negate the other work on reforms too but I feel this is the last remaining item to conclude satisfaction to move ahead again with the project to delete the zeros.  I have had word that the smaller category notes are already at the banks.  …so as the banks bring in the larger 3 zero notes they exchange them for the smaller notes. Since this is done way before any rate change, there are lots of smaller category notes obtained as needed to fulfill the needs of the marketplace afterwards.  [post 1 of 2]

Adam Montana – Dinar Guru   This is a topic we’ve been on top of since 2017, before the talk of OPEC agreeing to slowing oil production. The headlines would be more accurate if they said “Planned reduction in oil production to stabilize prices”  But that doesn’t get as many clicks, it’s just not as sensational…even though it’s the truth. And we’ve been expecting it, because we have been watching this sector through a fairly specialized set of glasses.  Interpretation: All is going according to plan.  And if all is going according to plan, then it’s just a matter of time.   … we’re not going to have an RV in the next couple days.   Unless I’m wrong. I’m always open to that possibility!  [post 2 of 2]

Adam Montana – Dinar Guru    This has been an interesting week in the markets, but not so much for Dinar when it comes to actual news.  There’s a good reason for this. Oil has been pretty flat, just like the news on HCL. Step back and take a “big picture” view of the situation, and it’s easy to understand that this is to be expected. I find it amusing to read the headlines that state “Oil production falls to (X time frame) lows…”  Hang on a second, oil “falls”?! That’s the headline? I don’t think that’s accurate. It’s not “falling” – it’s being controlled, exactly as they planned. [post 1 of 2]

Mountain Goat – Dinar Guru   They are not raising the rate (NO REVALUATION). …They are going to reinstate the dinar and must first complete the project to delete the zeros. A result of this process will be an increased new rate on the currency exchanges. Once reinstated the market will drive the rate up on the float. So our concentration is not so much on a rate increase but on a reinstatement process, the rate on FOREX will be the end result…  [post 2 of 2]

Mountain Goat – Dinar Guru   [GOI has nothing to do with raising the rate…it is a total CBI decision.]  Oh yes they do…I presented about 6 articles already from the Iraqi news media from members of the parliament, cabinet and economists in Iraq. All say it is a joint decision to go ahead with the project to delete the zeros. It just happens right now they are moving ahead rapidly on it.  …Dr Shabibi…said and I quote- “there must be a joint effort to make the decision and the CBI and GOI must work together” – but out of courtesy and not by legal commitment. This means the GOI may influence the decisions and has to pass laws to help the CBI with monetary policy. But the CBI make the final call, The CBI does not run the govt the GOI does. The CBI needs these banking reforms, anti-money laundering and anti-terrorist laws, etc…So in this regard Shabibi knew darn well they must work together…  [post 1 of 2]

Larrykn – Dinar Guru   they seem to be going in the right direction, I can’t wait to see what happens when Parliament meets.

Kaperoni – Dinar Guru   If you believe monetary policy is based on sound logic and principals then you know the dinar can never arbitrarily revalue.   It is my belief the CBI plans to gradually raise the value of the dinar as a tool to counter inflationary pressure created when significant investment comes to Iraq.  Iraq will never redemoninate or LOP the currency.  Monetary policy in Iraq the past 14 years has been a success not a failure.  The next phase will also be a success which is to float the currency. But first Iraq must complete the GOI and pass needed investment laws.  Completion of the GOI and the laws will encourage participation in Iraq’s economy thus giving the CBI a reason to begin to float the dinar.

David M. Witty – Dinar Guru   Iraqi PM Abdel-Mahdi confirms the need for continued US-Iraqi cooperation to defeat…  US President: we will spend $3 billion to develop Ein al-Asad base in Anbar Province, Iraq, to ensure final defeat of terrorism. We have no intentions of leaving Iraq.

Larrykn – Dinar Guru   Looks like they are working on the corruption over in Iraq, this is good news…What I’ve been reading is showing they are working on corruption and security these are two of the main things they need to get a handle on.  Article quote:  “Iraq has been intensifying the security measures in the western regions to prevent the infiltration ISIS militants fleeing Syria.”   …this article shows they are working on Security which we need to see if they are going to do something with their currency…this is all good news.   …when Parliament comes back if they get the laws passed for investors. and banking we will be looking good…IMO.

Kaperoni – Dinar Guru   A couple of good reads the last few days…WTO News as Iraq inches closer to full accession.  A critical part to this puzzle.

Larrykn – Dinar Guru   Article:  “Iraq deploys 20,000 personnel in Anbar to watch borders with Syria:”  IMO this is the reason why the US should not leave Iraq, Isis has lost in Syria and is heading back into Iraq, they don’t want to see what happened before happen again.  I think this month will tell us a lot about where we are at and going to be at.

MilitiaMan – Dinar Guru   Internationalism…Can’t hide it now… The Cat is out of the bag… Even the Governors of the Provinces and the Religious Authority is calling for distribution of the Iraqi wealth and now we see Citi Bank able to do similar distribution of timely payments through a chunky credit facility. These latest actions from the Governors meeting this last week on 2019 Budget allocations to be disbursed for re construction projects and Qasim al-Tai religious authority telling PM Mahdi to distribute the wealth to the citizens in a fair and equitable manner all around the same time frame of the passing of key laws this week.  My bet on this is the Citizens are squawking even louder now that the Tariffs are being enforced.  They signed this credit facility on Thursday of last week!!! Same day the Governors were meeting on disbursements to the provinces. See the the progress in play now? I sure do.. Man it looks good too! imo.