Samson: Deputy explains the reasons for the high price of the dollar against the dinar
16th October, 2020
On Friday, a member of the Parliamentary Finance Committee, Naji Al-Saeedi, revealed the reasons behind the high exchange rate of the dollar against the dinar in the local market.
Al-Saeedi said in an interview with Alsumaria News, “Any country that is exposed to a financial policy crisis, its monetary policy will be affected in turn,” indicating that “Iraq Today, it operates according to a fixed exchange rate system, and it is very exaggerated and supports the external product, not the local.”
Al-Saeedi added, “The shift from the fixed exchange rate to the creeping exchange rate, especially in periods of financial instability, will have a very negative impact on the expectations side, as if the price is raised to a point or two, it may affect four or five points in the market and this is for him.” Negative effects on low-income people and the simple citizen,” stressing that “the use of inflationary financing or the new monetary issuance as the government borrowed treasury bonds from the central bank, the latter did not use the existing hard currency reserves, but rather used the new cash issue.”
He pointed out that “this measure of the central bank raised the monetary mass in Iraq from 56 trillion dinars to approximately 80 or less trillion dinars and this increase leads to monetary inflation and continuing with it leads to an increase in the exchange rate of the dollar towards the Iraqi dinar and this is a very natural thing in monetary policy, as the new monetary issue leads to the exchange rate of the dollar, given that The government did not use real resources to finance the deficit, but rather inflationary resources.
”Al-Saeidy stressed, “This procedure is similar to what the previous regime used to do, and it is contrary to Central Bank Law No. 56 of 2004 in its Articles 32 and 28.” LINK
DeepWoodz: MilitiaMan said…..So it appears they have issued bonds with a new cash issue. That would seem to be at a new rate too. As they were not very successful in selling bonds (if I recall) in the past while at a program rate. Again this is an example of using more of a negative slant with verbiage while telling us the positive. If they sold Bonds with a new cash issue and not at a program rate, then they’ll be exposing that new cash issue in short order… imo.. ~ MM
Thank you as always for an easy explanation MilitiaMan we were wondering if this article meant what it said!
IMO And we all may remember a previous article mentioning this concept by how Central Banks use the situation here from the article as a MONETARY TOOL:
“Negative effects on low-income people and the simple citizen,” stressing that “the use of inflationary financing or the new monetary issuance as the government borrowed treasury bonds from the central bank, the latter did not use the existing hard currency reserves, but rather used the new cash issue. “
A break down of this idea/monetary tool helped us to understand this concept expressed in the article for sure:
- USE OF INFLATIONARY FINANCING – IS MEANING A NEW MONETARY ISSUANCE
- GOVERNMENT BORROWED TREASURY BONDS FROM THEIR CENTRAL BANK
- NOT THE USAGE OF THEIR CURRENCY RESERVES
SO: THERE WILL BE A NEW CASH ISSUE SOON towards the citizens and that requires a value in some purchasing power ….. IMO
Just wanted to add some thoughts to MM’s….
“and it is very exaggerated and supports the external product, not the local.”
We know that the higher the exchange rate, the cheaper imports into Iraq will be for the citizens, which is great because they import most everything.
“as the new monetary issue leads to the exchange rate of the dollar”
The new monetary issue being the NSCN’s (LD’s) that must have the new rate. Frank said there was a certain number of citizens that would have to see the pics or actual notes before they would release them. FA 333 looks like the perfect tool to get the citizens in to the bank by finally paying salaries. There will be income tax added. Come get paid and see your new currency with the new rate! Imo
Samson: Baghdad transferred 2.4 trillion dinars to the Kurdistan region
17th October, 2020
The central government in Baghdad transferred 2.4 trillion dinars to the Kurdistan region for payment in employee salaries and social care
The Kurdistan Regional Government did not pay any amount to the capital, Baghdad, during the current year and last year, as the budget for the year 2019, which is still in effect until now, stipulates that the region will pay daily to Baghdad 250 thousand barrels of oil produced in Kurdistan in addition to 50% of the revenues from the outlets. Borderline
According to the monthly report, issued by the Ministry of Finance, for last August, the Baghdad government has sent an amount of 2,081 trillion dinars from the beginning of the year until last August, as salaries for the region’s employees and social care
A few days ago, Baghdad sent an amount of 350 billion dinars, so the total number sent since the beginning of the year until now is 2.4 trillion dinars
The relationship between Baghdad and Erbil has been witnessing a great tension that extends since 2012 when Erbil made an agreement with international oil companies during the years 2005-2010 and oil production in 2012 outside Baghdad’s control and exported it to countries around the world
Some information indicates that 85% of Kurdish oil is exported to Israel, and the rest goes to Turkey and several other countries. The Kurdish oil export process takes place through the Turkish port of Ceyhan
Samson: Israeli media: Israel and Bahrain will sign an interim diplomatic agreement
17th October, 2020
Israeli media reported on Saturday that Israel and Bahrain are expected to sign, on Sunday, a joint interim agreement on “establishing peace and diplomatic relations.”
According to the Israeli “Wahh” website, Israeli and Bahraini officials will sign the declaration in Manama, under the auspices of the US Secretary of Finance, Steve Mnuchin, and the White House envoy, Avi Berkovitch, and among what the declaration will cover is “establishing full diplomatic relations and opening embassies.”
Israeli officials pointed out that “the joint declaration is on two pages and will be a kind of interim agreement. It will also be phased between the declaration of normalization that was signed at the White House on September 15, and the signing of a comprehensive agreement.”
According to the Israeli website, “It will be written in the joint declaration that the two parties will not carry out hostile acts against each other, and will work to prevent hostile acts by a third party,” and the declaration will stress that “both parties are committed to coexistence and a culture of peace.” Civil aviation, tourism, trade, science and technology, environmental quality, communications and mail, health, agriculture, water, energy and judicial cooperation.”
According to the site, “the representatives of Bahrain are the ones who requested to sign at this stage an interim agreement in the form of a joint declaration, Not a complete deal. The reason for this is internal criticism in the Kingdom against normalization with Israel and the desire to progress gradually more than the Emirates.” The site pointed out that Israel agreed to the Bahraini request.
Representatives of the UAE, Bahrain and Israel signed a peace agreement in mid-September, under the auspices of US President Donald Trump. LINK
Today the US Treasury Secretary heads a delegation on a visit to Israel, Bahrain and the UAE LINK
GodLover: it is the citizen’s who are expecting to protest on the 25th, which is their rights to be heard & their government to comply to their demands imo. I give the protests 100% likely to happen on or around the 25th & hopefully this will encourage the GOI to produce more than just MR talking….something the citizen’s can see for themselves. imo
Ryan1216: History repeats itself. I didn’t think the citizens would have to protest again to bring forth the MR. Well I didn’t think we would be into October and the new rate still hasn’t come out. Kazemi is doing all of the right things. Let’s pray this ends now and we all can move on from this investment
Samson: Supporters of the crowd demonstrate in front of the headquarters of the Iraqi president
17th October, 2020
Dozens of supporters of the Popular Mobilization Forces gathered on Saturday in front of the headquarters of the Iraqi President Barham Salih in central Baghdad to protest against the statements of a Kurdish politician.
Shafaq News correspondent reported that dozens of supporters and fighters of the crowd gathered in the two floors square, near the headquarters of the Iraqi President Barham Salih. He added that this gathering came in protest against a statement by the leader of the Kurdistan Democratic Party, Hoshyar Zebari.
This comes a few hours after dozens of popular crowd supporters stormed the headquarters of the fifth branch of the Kurdistan Democratic Party, located in the Karrada district in central Baghdad, and set fire to the headquarters and the Kurdish flag. In Kirkuk, fighters and leaders of the Popular Mobilization Forces protested.
These protest rallies came in response to repeated calls from accounts on social media platforms affiliated with factions in the crowd close to Iran, including “Rubu’allah” and “Sabreen News”.
Zebari had called on the Iraqi government, during a television interview, recently, to clean up the Green Zone from “militia militia” factions, due to repeated attacks on diplomatic missions. LINK
Samson: Parliamentary Finance: Every Iraqi child is born in debt of $ 3,000
17th October, 2020
The reporter of the Parliamentary Finance Committee, Ahmed Al-Saffar, revealed, on Saturday, the size of the debts on Iraq after the new borrowing if approved by Parliament, while noting that the Iraqi child’s debt when he is born will be 3000 dollars
Al-Saffar said in a televised interview followed by Al-Iqtisad News, “Iraq owed 40 trillion dinars internal and 25 billion dollars abroad before the vote on the borrowing law, and after the approval of the borrowing law of 15 trillion dinars and 5 billion dollars, Iraq became owed 55 trillion dinars and 30 billion Dollars
He added, “If the new borrowing law is approved, 41 trillion dinars, the total debt will be 96 trillion dinars and $ 30 billion is debt owed by the government, with the exception of more than $ 40 billion. This is the Gulf debt of the Iran war
He continued, “If we divide these debts on the population, it will be the debt of every individual and the Iraqi child when 3000 dollars are born abroad and internally LINK