Dinar Observer Daily

Mountain Goat – Dinar Guru   So what we know right now is the CBI wants to continue with the project to delete the zeros but had to put it on hold since the beginning of the protestors.  They told us they intended to complete it by year end. This verified once again that December and January are significant months for the CBI to complete this project.  Many keep asking me if the project will still work outside of this Dec – Jan time frame. Yes it will but this is not the “optimum” time the CBI and the Finance Committee would like to do it…This week my CBI contact told me they had 2 important meetings and they were all about the project to delete the zeros. I am telling everyone that this project is VERY, VERY important for the 5 year plan of which was supposed to end in 2020. This project was (or still is) supposed to kick off the investment frenzy for Iraq by this time. So, we have now entered 2020 without it.  So what? It is only mid-February and still they have not yet paid anything out this year. This is good and we can see are intentionally holding off. But this can only last so long.  [post 1 of 2]

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Kaperoni – Dinar Guru   …MCP  [MULTIPLE CURRENCY PRACTICES]  has nothing to do with dual currencies…has to do with pricing…has to do with price of goods.  MCP  is the variation or price of goods from one currency to another…has nothing to do with dual currencies in a country.  That will always exist in Iraq.

Mountain Goat – Dinar Guru   Article:  “L-KINDI NEWS: SALEH, AL-HALBUSI, AND AL-BARZANI ARE TOOLS TO IMPLEMENT THE NEW US PLANS IN IRAQ”   …there is a US plan of Iraq and they are implementing it. This is how this entire protesting stuff started. It was the beginning of the end of the Iranian militias and politicians in Iraq. But it takes time and so be patient.

Kaperoni – Dinar Guru  Currency auctions are based on a “balance” of dinar to dollars. In fact, the recent weeks have seen a significant increase in dollar sales, therefore the CBI has to inject dinar to balance it.  That is why you also see an increase in recent weeks in the money supply of dinar...its the balance of the two that maintains the exchange rate and the stability of the spread is a IMF requirement.  [ 2 percent 90 days yes]  Yes, they are in compliance, but that is because they are maintaining a balance of dinar to dollar…so there is no way to significantly reduce the money supply (either dinar or dollars) under the current system.  If they reduced the dollars, they could in theory also reduce the dinar but it must be a balance or the exchange rate and spread would change and if you reduced the dollars it would create issues since they need dollars for foreign exchange.  It is complicated and their are many aspects you need to consider…it is not a simple, reduce the money and RV…

Mountain Goat – Dinar Guru  …This reinstatement, would have and should have, already occurred by now. But we all know why it hasn’t…right? …the Trump administration is working very hard, with and within Iraq, to clean up this Iranian mess. They will succeed…There is a plan and they are moving forward aggressively.

Mountain Goat – Dinar Guru   …If you have been following the news from Iraq you should clearly see that they are “fast-tracking” the new government and also getting the 2020 budget amended and passed on to parliament. Why is all this occurring so fast?  For one it is the pressure from the protestors. Second it is the threat of going back in to UN sanctions chapter VII. Already UN security forces are in Iraq…But this is all very good for us…

Kaperoni – Dinar Guru     … “Anybody who researches this investment will know the IMF is the trustee of the CBI. They took control in 2015. Therefore, and it is already been proven that the CBI does with the IMF tells them to do. So one only has to go read the Article IV consultation from a few years ago when Shabibi was preparing to transition. It is plan [plain ?] as day… 14. The de facto fixed exchange rate (that means peg) has served Iraq well. The authorities agreed that a stable nominal exchange rate provides a valuable anchor for inflation expectations in an uncertain environment, and intend to continue implementing this policy for the foreseeable future. In the medium term, staff encouraged the authorities to consider creating the conditions which would make possible a move to a more flexible exchange rate policy (they are talking about a float). Such flexibility could allow a predictable and gradual appreciation of the nominal exchange rate, triggered by strong oil revenues and the Balassa-Samuelson effect, to accommodate a possible real exchange rate appreciation while keeping domestic inflation low…It does not get any clearer than this direct from the IMF. Not only is this the plan but this conforms to monetary policy…”

Kaperoni – Dinar Guru   People need to realize that even though the protests demanded change it substantially slowed progress.   The new PM needs to be confirmed, a cabinet needs to be named and confirmed and parliament needs to get back passing legislation.  Months of delays are expected…

Dinar Investor – Jeff  ...Can it [the rate change] only happen on a Sunday?  …yes.  and the reason why, remember Kuwait did theirs on a Sunday morning.  This is not just a small rate change.  Small rate changes can happen any day of the week.  This is a massive jumbo rate change.  The reason why it has to happen on a Sunday morning is because it has to happen when all financial markets around the world are closed to control and reduce market volatility because with that size of a rate change being so massive it would…cause tremendous volatility within the financial markets around the world. They don’t want that…it’s easier for them to do it after hours when markets around the world are closed…

Mountain Goat – Dinar Guru   Article:  “MUHAMMAD TAWFIQ ALLAWI TO ADDRESS THE 20202 FISCAL DEFICIT”  Quote:  “AFTER THE PARLIAMENT VOTES BY AN ABSOLUTE MAJORITY OF THE MEMBERS OF THE NEW GOVERNMENT AND THE MINISTERIAL PLATFORM, THE ALLAWI GOVERNMENT CAN DISCUSS THE BUDGET AND SEND IT TO THE PARLIAMENT.”   this article is telling us that Allawi’s new government must be formed and ratified by parliament before the new budget can be sent over to them. This is why Allawi must work quickly to form his new cabinet. Also they tell us he does not like the large deficit and so he is going to first address it too before sending it over.

Chattels – Dinar Guru  Allawi presents his cabinet in two weeks, and its names will only be announced in Parliament.  Constitutionally speaking, Allawi’s 30 days to form a government began on February 2.  Not that in Iraq constitutional deadlines or red-lines mean anything. But, two weeks from today will be February 24 or only a week left under the constitution to form a government. Hardly a meteoric pace.  Assuming it is done timely which would be a change for Iraq.

Mountain Goat – Dinar Guru   …I am hearing lots of chatter about elections in six months…This is NOT going to happen and here is why.  The Iraqi legal expert, Ali al-Tamimi, said on Wednesday (February 05, 2020) that the Iraqi constitution did not include an article or a paragraph called “an interim government,” noting that the  Prime Minister-designate Muhammad Tawfiq Allawi, would continue to run the government until 2022.  …sometimes what you are seeing in the surface is not the entire story…TRUST ME there is a plan and they are executing it. We will see our reinstatement sooner rather than later.

Francis Albert – Dinar Guru  […bottom line Iraq can make monitary changes when ever they want I believe it is and has been a security issue holding them back.]  It feels that way to me also… I “believe” the CBI has been ready to do something significant. (not sure what this will be). As things cool down and the Iran ‘s influence decreases…something will happen.

Dinar Investor – Jeff   …Trump actually picked the year that he wanted this to happen.  Obviously Iraq had to have a combination of stability too but Trump most likely wanted this timed for the rate change to be timed with his 2020 campaign theme of a strong economy…all we’re waiting on here is a specific calendar day. [Sunday March 22, 2020].  Iraq does appear to be walking possibly when Kuwait did there’s…everything is looking good.

Breitling – Dinar Guru  …what Iraq needs from their budget – how much they make and how much they need – they talk about getting to a billion notes to get to $1.17 and up.  At a minimum they need about .53 cents.  That’s based on their information.  Even though I’m speculating that’s the best math I can come up with based on what they need.  They need about .53 cents.  That does not mean that’s what they will come out at...

Francis Albert – Dinar Guru   Obviously… Kap is throwing the baby out with the bath water. I don’t believe any sensible person believes the Iraqi Dinar is going to go from .00086 to $3.50 overnight. (This is what most believe an RV will be)…What Kap doesn’t see, is the forest for the trees. It is obvious to anyone paying attention to the news, Iraq is going to take their currency international and take off the program rate instilled by the IMF, U.N…So, a hit from program rate to something like .86 popping on Forex overnight, (my prediction), is very possible and doable…of course it will “float”. All currencies are pegged to the dollar and go up and down as people buy them… Kap is right. Who knows how long it will take for it to go up from the initial hit? I think a few months can get us to an “interesting” number. But, hey, .86 is pretty darn interesting, but I wouldn’t sell at this price. That’s my .86 for today (FWIW).

Dinar Investor – Jeff  …Iraq’s got a new PM…hopefully by the end of February he can get his cabinet formed…we are not waiting on the formation of that government.  Sometimes people might tell you we are.  We’re not waiting on the formation of the government.  They have their stability they need…Iraq’s transitioning to a new fiscal year.  They’ve already told us that the reforms are the large deficit within the budget – that’s all post rate change.  Everything is moving in the right direction.  We’re looking good.  I have not changed my time-frame...Iraq is now walking in Kuwait’s timing footsteps.  It’s that simple…we’re waiting on one thing.  We’re waiting on the calendar [March 2020]...

Breitling – Dinar Guru   …People send me emails asking very specifically if Trump has any sway or anything like that on the Iraqi dinar?  Not the Iraqi dinar.  He has influence on the price of oil.  And he has influence on Iraq’s U.S. accounts.  We can freeze those.  The dinar itself they have control of...everything we look at and look for that’s what’s going on.  They are reducing their note count.  Oil prices are going down.  They have an emergency budget put together because  that exact cause and effect. So here we are...I’ve never had any fear about them adding value to the dinar.  Not once…

Kaperoni – Dinar Guru  If they float the currency like the IMF has asked. Who knows how fast Or at what pace it would rise. Market forces determines that.

Mountain Goat – Dinar Guru   2) Remember they must go at least 1:1 in rate if they pay out the stipends and this would mean the project to delete the zeros would be necessary. My take on all this is this is what will finally trigger the RV. This would also lead to the reinstatement. We know the banks have already exchanged three zero notes for the smaller category notes and have ample supplies to go ahead now. This happened over this past year. So they are ready for something. The CBI would not be doing all this is nothing was being planned.  So, this is all VERY GOOD news for us…I am told this is coming in “the coming days”. However days always seem to miraculously turn into months somehow…lol..,   [post 2 of 2]

Mountain Goat – Dinar Guru   What does the CBI need? The CBI needs political stability and for the protestors to go home. Allawi is desperately trying to gain their confidence but we know he will have to eventually put out or shut up…he will have to produce something meaningful for the citizens. This is probably going to be the HCL stipends. This is my guess. What do we know about these stipends?  1) Over two months now an agreement has been made to actually begin the payout of these stipends…the referendum has already been written and passed through the parliament in 2018. Like other legislation it just sits on someone’s desk and never gets implemented. Now they agreed to implement it to help in this situation.   [post 1 of 2]

BobTheTaxMan – Dinar Guru  Question “Let’s say you don’t have the receipt for the dinar when you purchased – you don’t need that to exchange do you?”  No.  Now earlier in this crazy game we’re involved in there was an idea that you were going to have to have the original date of purchase because they thought it was going to be capital gains.  In reality it’s not.  It’s going to be ordinary income.  It’s going to be no different from exchanging currency you currently have in your pocket.  It’s not going to matter.  So don’t worry about that part…

Mountain Goat – Dinar Guru   Article:  “IRAQ BUSINESS NEWS: SERIOUS QUESTIONS ON THE APPRECIATION OF IRAQI DINAR”  Quote:  “…the “independence” of the CBI was compromised in negotiating and signing a ‘Stand-By Agreement’ with the IMF in late 2005.”  This refers to the first stand-by-agreement in 2005. We need to tie this in what happened in 2011-2018 and then into 2019 and how the independence of the CBI was compromised. So please don’t anyone tell me the CBI can reinstate anytime it wants to. This is NOT true. The CBI needs the permission and full support of the GOI which included the prime ministers cabinet and parliament. Now we see they also need the permission of the IMF…

BobTheTaxMan – Dinar Guru  Question “Is dinar attached to a social security number -Is there anything special that needs to be done to exchange it?”  No.  The only reason why they ask for social security number is because of the intensifying of the rules and regulations chasing down terrorists.  It just verifies you’re a real person when you buy it.  And that’s its whole purpose.  You’ll see people selling dinar on eBay or Craig’s List  there’s no social security number associated with any of that stuff.  When they go to cash it in…they are not going to care where it came from.  So don’t worry about that.  The only purpose in people asking for that social security number was for the dealerships so they could satisfy some of the IRS standards that are now in place.  That’s it.

Angel1 – Dinar Guru  …MTA [PM Allawi] is an extremely successful businessman…he has businesses all over England, UK, Lebanon, Morocco you name it.  He has had successful businesses.  Run huge corporations…we are seeing a direct reflection of what we have in the US. Trump is a businessman.  We are getting incredible results because of it…And we are about to see incredible results because of it…he [Allawi] was in Washington several months ago doing what I like to call phase 1 of the interview.  I believe he was interviewed for this very position that he’s sitting in by Washington led by Trump…he gave an incredible speech on the importance of an increase of value to the Iraqi dinar.    People ask me, ‘what does the banking world think of MTA?‘  He’s one of us.    He’s a businessman.  He understands value…He is against corruption…this is who is in charge of Iraq now…Phase 2 – Iraq getting him onboard.  He’s now onboard.   Phase 3 is implementation.  I believe that’s exactly where we are right now…  

Adam Montana – Dinar Guru   Article:  “Iran desperately attempts to retain hold on Iraq”  …One great example of what’s going on in the background – the stuff we don’t see on the news…Iran is obviously making a last ditch effort to hold ground.  Quote:  “Iran on Sunday offered its full support for new Iraqi prime minister Mohammed Tawfiq Allawi and reiterated its backing for the government’s demand for US forces to leave the country.”  Does anyone think Iran is going to win this ultimatum? I do not. Especially not with Allawi at the helm, who is presumably approved by greater powers than Iran. This is precisely why Iran is making their last ditch, desperate attempt to gain footing… and it looks like a failed attempt from the start.  If Iran has any success whatsoever in this attempt, we are going to see it immediately. I can’t wait to see this Iranian attempt fall on it’s face!

Dinar Investor – Jeff   …Over the weekend they came out saying that Allawi the new PM might try to get his government formed within approximately 3 weeks.  Another article came out saying they were going to open the path to reform and that’s great news but the good thing…is they’re talking in circles…they’re just repeating all of the same information that they have.  Clear since last year, reforms, reconstruction and the end result…they’re waiting on the rate change.  That’s why they just keep repeating themselves talking in circles…they’re showing you everything’s waiting on the rate change including the approval process of the budget.  We’re looking good.  Everything’s moving in the right direction…

Adam Montana – Dinar Guru      […I still would have preferred the other Allawi…]  Agreed on the Allawi we got, but it is what it is and I don’t care who gets the job done as long as it gets done!  Whether we see an RV this week or not, I’m very solid that we are going to have a much clearer picture over the next few days.

Dinar Investor – Jeff  …Iraq is looking really good.  Everything’s moving in the right direction…nothing in Iraq is speeding this up.  Everything is moving at the same model speed it always has.  Iraq has had a set date since early last year in ’19.  Nothing’s going to speed this up or make it move faster.  The whole challenge with the prime minister was just a coincidence.  Over the weekend someone had jumped in and stated that once the PM comes in that will probably speed up the timing of rate change and wrap this thing up in 30 days after the PM…none of that is accurate…they’ve go a set calendar date.  It’s most likely a fiscal year so that would put them right on par with Kuwait.