Bgg roundtable 9/21/15
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    Bgg roundtable 9/21/15

    WELCOME TO BGG ROUNDTABLE AT DINARUPDATES.COM



    BGG: I'm going to need some help right out of the box here...
    BGG: anyone remember which rating agencies gave Iraq their ratings so far??
    BGG: Fitch and ??


    rcookie: Moodys

    BGG: Who was the last one that hasn't rated yet??

    Holly1: moodys

    jeff8: STANDARD & POOR


    BGG: Moody's assigns provisional rating of (P)Caa1 to Government of Iraq's USD bond issuance; Outlook stable
    BGG: (some interesting comments by Moody's)


    BGG: Moody's Investors Service (Moody's) has today assigned a provisional rating of (P)Caa1 to Government of Iraq's planned USD-bond issuance with a stable outlook. The rating was initiated by Moody's Investors Service and was not requested by the rated entity. It is being assigned ahead of planned issuance of USD-denominated debt by the Iraqi government in the United States under Rule 144A.

    BGG: ...Iraq ranks at the very low end when compared across all Moody's-rated sovereigns for the World Bank's Worldwide Governance Indicators -- particularly Government Effectiveness, Rule of Law, and Control of Corruption. In Moody's view, the lack of a budget law for 2014 and low budget execution rates illustrate shortcomings with regard to government effectiveness...

    BGG: ...According to the 2004 Central Bank of Iraq (CBI) Law, the central bank is independent from the government. The CBI's primary objectives are domestic price stability and a stable and competitive market-based financial system. The central bank has successfully reduced inflation rates and consumer price inflation averaged 2.7% between 2008 and 2014...

    BGG:
    ...Political and security risks are very high, driven by underlying ethnic and sectarian tensions, and by Iraq's location within an unstable region. Even if dissolution or disintegration is unlikely, the combination of domestic and geopolitical risks affects the government's capacity to service its debt which weighs very heavily on Iraq's rating...

    BGG: ...The ISIL insurgency poses the key immediate threat. However, external support for Iraq is increasing, and it is unlikely that ISIL would threaten either Baghdad or the south of the country where most of the population and oil wealth is located...

    BGG: take special note of this part...


    BGG: ...The current government has focused to a far greater extent than its predecessors on promoting national unity and national identity. For instance, key cabinet positions such as finance minister and defense minister are held by members of the non-Shia population groups. In Moody's view, this holds out the prospect of more cohesive, stable and effective governance of the country in years to come...
    BGG: A number of things could effect this rating up or down... but nice to see the good side - in a realistic assessment.


    BGG: I was asking before which agencies had posted some credit rating thus far for Iraq... I was pretty sure the last one hadn't done so yet - either Moody's or S & P??

    rcookie: BGG they are forecasting 8% growth over next 4 years...but whopping 79% debt ratio by end of 2016

    BGG: this "provisional rating" appears to be for their international bonds only.
    BGG rcookie: I saw that...


    jtank: not good

    BGG rcookie: I also noticed they gave a plug for the CBI's monetary policy being responsible for an average 2.7% inflation factor annually from 2008-2014...
    BGG rcookie: they are apparently intending to spend some dough between now and 2016...
    BGG rcookie: however, this bond business isn't even close to amounting to that number.
    BGG rcookie: 100 billion USD budget and they plan on borrowing 79 bil??
    BGG rcookie: Really??


    rcookie: oil production rising at 10% per year...and everyone revising back numbers...they had better get these other sectors moving and tariffs

    BGG rcookie: the WB just told them in London they wouldn't mind loaning them money but it can't go to their general fund...
    BGG rcookie: which is really what they are trying to borrow money for - right now...
    BGG rcookie: bridge the budget gap...
    BGG rcookie: what banker in his right mind would loan someone money because they are spending too much...


    rcookie: deficit still at 15% of GDP...and their top economists are commenting that the borrowing is disaster in the making

    BGG rcookie: I am with their top economists...
    BGG rcookie: terrible idea.

    thomas1: hey i just got herethomas1: BGG did it rv

    BGG thomas1: When that happens you won't have to ask - you're on the D.U.C.E. list - it will get BLASTED around the internet in minutes...
    BGG thomas1: and I promise - I won't be sitting here chatting about it.BGG thomas1: I will be out "gathering info" on the best place to exchange...

    thomas1: i am on it man'

    thomas1: bgg and mrs. bgg you are the best

    Robl: Not a question, but a link to Moody's explanation of rating for Iraq https://goo.gl/RbtaKb

    BGG Robl: Thanks for that info...

    Robl: Welcome!

    ddboys1626: 200,000.00 dinars = 171.52 dollars, my question is how is that going to help the people of Iraq???

    BGG ddboys1626: who here says it does - or that there has been any "adjustment" touting some betterment for the people of Iraq??
    BGG ddboys1626: that looks like the current rate for the Dinar??
    BGG ddboys1626: about 20 bucks per 25k note...



    dstratton04: when is Maliki technically gone? do they have to vote on it for him to be out ?

    BGG dstratton04: "technically" - when they vote on the legislation delivered to Parliament by the CoM and whatever initial challenge by Maliki is met - that would be "IT"...
    BGG dstratton04: I fully expect Maliki to run before then..
    BGG dstratton04: also (and related news)...
    BGG dstratton04: today Abadi said he wasn't going to "try his reforms in the media"...
    BGG: sounds like (to me) he means business... (like the Moody's opinion pointed out)

    dstratton04: what does that mean?

    BGG dstratton04: it means - he's not going to talk about it - he's just going to do it...

    dstratton04: awesome

    CanuckLady: Just Do It
    diane1: THANK YOU GOD DOING THIS WOULD BE NICE

    ======================

    BGG rcookie: OK - what is the biggest piece so far today?? IYO

    rcookie: I think the Moody's report and revisions of the 2016 budget to reflect more realistic oil numbers of $40 @ 3 M bpd from the $45@ 3.6M bpd
    rcookie: looks like they are anticipating shift in OPEC production


    BGG rcookie: what's the number today??

    rcookie: $40 from $45

    BGG rcookie: they will be very lucky if it isn't lots lower than that in 2016...
    BGG rcookie: especially with the sanctions off Iran

    rcookie: Russians are predicting $30

    BGG rcookie: and Saudi Arabia about ready to "open things" up...
    BGG rcookie: WIDE OPEN...
    BGG rcookie: as have I been predicting as much.

    rcookie: BGG here the driver of the loan & borrow 'clown bus"

    BGG rcookie: however, Russia may be articficially stirring things up by being in the Middle East...
    BGG rcookie: the spectre of unrest ALWAYS trumps actual production values.

    rcookie: Relationship: the continuing programme of financing loans and cash reserve "locked"
    September 21, 2015 20 Economy/Baghdad Iraqi Central Bank Governor stressed the relationship: "the programme loan financing will remain constant regardless of the financial situation of the Ministry of finance and State institutions."Allaq said in a press statement obtained by the news agency economy programme loan funding will not be affected by low world oil prices and the economic crisis, and is an initiative of the Central Bank shall be followed and implemented exclusively. "

    rcookie: Central Bank Governor reiterated his assertion that "Iraqi reserves locked in a controlled setting and constantly changing, away from the negative impact of low world oil prices.
    http://www.microsofttranslator.com/b...8%25d8%25a7%2F

    BGG rcookie: What on the Good Green Earth is this NOOB talking about??
    BGG rcookie: he's going to "loan them out of bad times"...
    BGG rcookie: is this guy CRACKED??


    rcookie: You can hear the cuckoo birds!!!!


    BGG rcookie: this only proves everything I have been saying about his complete lack of grasp of things ...
    BGG rcookie: and it looks like this is some kind of "weak political appeasement" statement...


    dstratton04: agree bgg

    BGG rcookie: just him blabbing about giving some money to the people to slow down these demonstrations - I don't see any way it works.

    BGG: Abadi isn't going to "try his reforms in the media" - he's just going to "DO IT"..
    BGG: I smell some more "pink slips" coming...

    CanuckLady: Sorry not to try and change the subject but wondering when the final Iran vote will take place on the nuclear deal or is it ongoing

    BGG CanuckLady: not sure what the resolution was...
    BGG CanuckLady: I thought they were going to introduce some last ditch effort to take that a different direction... Thanks to Corker (our turncoat TN Senator) there is little that can be done.


    CanuckLady: thank you


    BGG CanuckLady: back to Dinar (and away from politics )

    CanuckLady: just wondering if their decision had any effect on Iraq

    BGG CanuckLady: I doubt it.

    dstratton04: do you still think alaq will be removed?

    BGG dstratton04: I do...

    BGG dstratton04: he's HAD TO BE IN ON this corruption.
    BGG dstratton04: there isn't an explanation that gets him off...


    dstratton04: good
    dstratton04: I do too. I have a hard time understanding why some think he is not corrupt.


    BGG: I did just talk to Mr White - he seemed to think Fitch and S&P had given their ratings... Moody's was the last one...

    wmawhite: and here is the link for the Moody rating.......https://www.moodys.com/research/Mood...aqs--PR_334915

    BGG: even though this is a "provisional rating" on their USD denominated bonds... bonds, currency, etc, etc are all similar in that...
    BGG: they are a "promissory note" on the economy of said country...

    Holly1 wmawhite: Hello its been a long time sheila and I was asking about you ... so happy you are here

    BGG: and I am sure their eventual rating on the country itself - will read about the same...
    BGG: it will be based on all the same factors and data points - in effect, this is their assessment on Iraq.

    Holly1: Just happy that Iraq has ratings no matter what they are ...

    BGG Holly1: Me too!

    wmawhite BGG: Fitch rated Iraq on August 7 and Standard and Poors rated Iraq on September 4, 2015

    BGG wmawhite: I knew you would know that off the top of your head...

    dale: BGg : Any thoughts why Alak hasn't been removed yet ...... do you think possibly Alak, Maliki and Mahmmoud might be removed at the same time?

    BGG dale: You nailed it!!
    BGG dale: or within a short period of time...

    dale: BGG: 10-4.

    BGG dale: Maliki first via official vote - then his supporters - Alak and Mahmoud

    dale: BGG : Sure sounds good .......

    BGG: OK gang - thanks for tuning in...

    BGG: (essentially) 3 international credit ratings is good - (and begs the ?? - what's up??)

    THE BLOG - Dinar Daily NEWS Blog - http://www.dinarupdates.com/blog/
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    Last edited by Swan2013; 09-21-2015 at 09:51 PM.



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