B reads an article about Iraq's progress which states that foreign investors have the same rights as domestic investors. Somehow Breitling equates that with revaluation of the currency and says that it proves loppers wrong. I have no doubt that Iraq's economy is growing and that there's opportunity for investors in Iraq. But there are plenty of ways to invest in Iraq without holding their cash, which is one of the riskiest investments you can make. That's what the whole discussion is about in the dinar community. I think the vast majority of loppers believe that Iraq is making progress and their economy is improving, and that is strategically good for the US. The disagreement is whether a growing economy automatically translates into a growing currency value. Historically it doesn't. Once again, currency isn't stock. The value tends to go down in emerging economies where the value of a stock tends to go up as the company grows.
B says loppers took their views from Bill Burbank. I actually wrote about BB getting shut down back in October. I certainly didn't learn about redenominations or "in country" RVs or anything else from him. I learned what I know from researching redenominations and revaluations.
B says that every one of these loppers has dinar. That's simply not true. I've stated that I still have some but it's less than 5% of what I once held. (Actually it's less than 2% right now.) I've talked to several who have either done the same or sold all the dinar they had. Many are regular readers who frequently comment on my Dinar Douchebags blog.
B says he doesn't understand why a lopper would own dinar. Well first of all I'm not sure that Iraq will lop, even though I am sure that they're describing a lop when they say that they intend to delete the zeros. They're dragging their feet about it and I think there's a good chance that they'll allow the currency to slowly appreciate upward to a penny or two. That's what I'm waiting to see. Ali Agha from Dinar Trade has said that he thinks that's how this will develop and his plan is to provide cash-in centers when the value reaches a penny. My disagreement with Breitling isn't about whether or not the dinar might increase in value. It's about what the CBI is saying (they've never said that they're going to revalue - they've said that the value of their currency will be raised when they redenominate and nobody makes money off of a redenomination) and whether their financial reports are fudging the numbers. It's about how a redenomination works. (Hint - large bills and small bills are all demonetized.) It's about whether or not a revaluation of 100,000% or more is conceivable. There's a lot more that we disagree on besides what the rate will be. The whole mechanics of currency valuation and redenomination are in dispute here. And then there's B's extensive history of getting his facts wrong, the Turkey redenomination being a perfect example.
B says that the market didn't take the value of the dinar down, but sanctions did. Here he's partly right anyway. Saddam's behaviour and the subsequent sanctions led to the depreciation. I don't agree that the value would have gone up without the sanctions, but it likely wouldn't have gone down either. Where I disagree is in his assessment of the market with regard to sanctions. The market is the market. Regardless of what triggered the hyperinflation that led to the current value, the value is what it is and the money supply is what it is, and you don't return a currency's value after a prolonged period of hyperinflation without a redenomination. PERIOD! There's no such thing as pulling in the 000 notes and reducing the money supply from 30 trillion to 30 billion (or 70 trillion M2 to 70 billion M2) in order to revalue. That's pure fantasy. And no, that's not what the CBI is telling us they're going to do.
B says that Shabibi and the CBI are telling us that they're going to strengthen the dinar. Again, partially right. What they've talked about is the strength of the dinar vs. other regional currencies when it comes to the percentage of backing. Iraq is the only country in the region that is backing their currency 100% with their foreign currency reserves. I wrote about this in my post "The Strongest Currency in the Region". They don't really have any choice since there's so little confidence in either their country or its currency, but it's true that the dinar is the strongest in that sense. That doesn't mean it's the most valuable obviously, or that it ever will be.
B mentions my interview with Scooter. He says that the fact that I interviewed him shows that my commentary on B is personal. Well here's the difference. Scooter isn't selling anything. Scooter never pumped lower denoms. And Scooter clearly said in that interview that investing in the dinar is riskier than buying penny stocks, and that anything could happen including nothing at all.
I interviewed several people late last year and early this year who I consider honest and ethical, as well as knowledgeable. I don't agree with them on everything but I wanted to present views on this investment that don't come from pumpers or people who are selling anything. Scooter fits that criteria. And I agree, he is a nice guy. And no, it's not personal.
http://www.youtube.com/watch?v=xB_h2a5Y-MU&feature=plcp
http://dinardouchebags.blogspot.com/2012/02/breitling-catalog.html
http://dinardouchebags.blogspot.com/2011/10/breitling-busted.html
I announced yesterday that I'm hanging it up next month, so buck up, B! This bionic turd will soon be gone.
.jpg)
No comments:
Post a Comment