Supplement to Part 1 using 30% of the 27 trillion dinar in circulation.
(#1) Exchange Rate |
(#2) Currency In Circulation |
(#1 x #2)
Currency Value In Billions of USD |
|
USA | 1.00 | 829 Billion USD | $829 |
Saudi Arabia | 0.267 USD | 1,176 Billion Riyals | $314 |
Kuwait | 3.58 USD | 8 Billion Kuwaiti Dinar | $97 |
Iraq | 0.00085 USD | 8,000 Billion Iraqi Dinar | $7 |
Data Sources | USA:
www.ny.frb.org
Saudi Arabia:
www.sama.gov.sa
Kuwait: www.cbk.gov.kw Iraq: www.cbi.iq |
The RV happens and the value of the IQD goes from $0.00085 (USD) to $3.60 (USD). This is on the assumption that the IQD will be on par with or greater than the Kuwaiti Dinar.
Country |
(#1) Exchange Rate |
(#2) Currency In Circulation |
(#1 x #2)
Curr Value in Billions of USD |
Iraq | 3.60 USD | 8,000 Billion Iraqi Dinar | $28,800 |
The RV happens and the value of the IQD goes from $0.00085 (USD) to $1.00 (USD). This is on the assumption that the IQD will be on par with the USD.
Country |
(#1) Exchange Rate |
(#2) Currency In Circulation |
(#1 x #2)
Curr Value in Billions of USD |
Iraq | 1.00 USD | 8,000 Billion Iraqi Dinar | $8,000 |
The RV happens and the value of the IQD goes from $0.00085 (USD) to $0.10 (USD). This is on based on no real reason except that it's a smaller possible value that has been floated online.
Country |
(#1) Exchange Rate |
(#2) Currency In Circulation |
(#1 x #2)
Curr Value in Billions of USD |
Iraq | 0.10 USD | 8,000 Billion Iraqi Dinar | $800 |
The zeroes are removed from the Iraq currency (Lopping) and no RV happens. In this case, I'm assuming that the value of Dinar in your hand as compared to USD does not change but you would exchange them for a smaller denomination that had the same exchange value. I'm also not going to cover the fact that the exchange might have to take place in Iraq instead of outside the country, etc. Those are other discussion points that are outside the scope of this discussion and I don't claim to have any facts to confirm or deny that scenario.
To explain the "Lop" as I understand it, I'll describe what would happen to 250,000 Iraqi Dinar in a Lop. I will not include currency exchange fees or anything else in this scenario. Just a straight Lop with no additional interference.
Country |
(#1) Exchange Rate |
(#2) Currency In Circulation |
(#1 x #2)
Curr Value in Billions of USD |
Iraq (Pre Lop) | 0.00085 USD | 8,000 Billion Iraqi Dinar | $7 |
Iraq (Post Lop) | 0.85 USD | 8 Billion Iraqi Dinar | $7 |
The zeroes are removed from the Iraq currency (Lopping) and THEN an RV happens. In this case, everything from Scenario 4 happens in addition to an RV. I assume that the value goes from the Post-Lop value to $3.60 (USD). This is on the assumption that the IQD will be on par with or greater than the Kuwaiti Dinar.
Country |
(#1) Exchange Rate |
(#2) Currency In Circulation |
(#1 x #2)
Curr Value in Billions of USD |
Iraq | 3.60 USD | 8 Billion Iraqi Dinar | $29 |
Observations for Part 2. At a straight 0.10 exchange rate of 8 trillion Dinar, the total currency for Iraq would be around $800 billion. That was about what the United States had around 2007. Seems high to me but not completely unreasonable. Also, a Lop then RV around 3.6 puts their currency at $29 billion instead of the $23 billion that conceptually be in circulation if they hadn't bought 70% back. If that is the case then a lot of more reasonable scenarios come into play but the currency in circulation still looks out of whack if you just take a straight jump to anything higher than $0.10.