Iraq’s Economic Ability to RV their Currency is Impossible Today
On July 3, 2023
By Awake-In-3D
We are told that Iraq is ready to RV, almost daily, out there in Dinar Land. Yet, when we examine Iraq’s current economic situation, it becomes clear that there is no logical or mathematical process that supports these frequent claims. Let’s take a look at the facts and see where they lead us.
Iraq’s Current Economy (May/June 2023 Reporting)
- GDP: US$264 Billion
- Oil Exports: 100 million barrels/month
- Oil Revenues: US$7 Billion/month
- Current Oil Price: US$70 per barrel
- M2 Money Supply: 173 Trillion IQD
- FX Reserves: 143 Trillion IQD
- Current Exchange Rate: 1310 IQD per 1.00 US dollar
M2 Money Supply is the measure of IQD held inside the country of Iraq including cash on hand and in Iraqi bank account deposits. It is not a measure of IQD held outside of Iraq (the notes we all have).
What if Iraq RV’s their Currency Tomorrow?
Let’s assume that we are all holding 5 Trillion IQD collectively in Dinar Land. If Iraq were to RV the IQD at $1.00 per IQD tomorrow, and we all decided to exchange at that rate, the Central Bank of Iraq (CBI) would need 5 Trillion US dollars (or Euros, GBP, etc.) to cover those exchanges.
- 5 Trillion IQD x $1.00 = $5 Trillion to cover our exchanges.
Iraq’s entire GDP is only US$264 billion per year and they cannot just print or create other global currencies out of thin air to pay for our exchanges in our local currencies. Even if Iraq came out and declared that one IQD is now worth one US dollar, no Central Bank or Forex Platform in the world would recognize that new rate, much less cover IQD exchanges at that rate for any of us. The economic math doesn’t come close to justifying this newly “declared” exchange rate.
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The simple fact is, Iraq’s economy would have to be 20 times larger than it is just to pay for our exchanges, much less cover their national operating expenses. By comparison, the United State’s GDP is over 76 times larger than Iraq’s GDP while the European Union’s GDP is over 64 times larger than Iraq’s.
What if Iraq Re-denominates (drops 3 zeros) the IQD Tomorrow?
If Iraq RD’s tomorrow, it would not be good for us international IQD holders under any scenario. Let’s assume that Iraq implements a new series of IQD notes without the 3 zeros. This means that the current 25,000 IQD note would be replaced by a new 25 IQD note.
As foreign holders of the old IQD notes, we would all have to trade in our 25,000 IQD notes for the new 25 IQD notes. This assumes that the Iraqi government would even allow foreigners outside of Iraq to trade in their old IQD notes – they most likely would not allow this to happen. But for this example, let’s assume that we are allowed to trade in our old notes at our local banks.
Now that we have the new 25 IQD notes, let’s also assume that the CBI revalues the new IQD notes a one-to-one for the US dollar. This means that we will receive $25.00 for one 25 IQD note. Furthermore, following the same math as above, the CBI would now only need US$5 Billion to cover our exchanges. This scenario is plausible since Iraq’s economy can afford this exchange rate with the new, lower denomination IQD notes.
- 5 Trillion in old IQD notes = 5 Billion in new IQD notes (deleting 3 zeros)
- 5 Billion new IQD x $1.00 = $5 billion in the new exchange rate
Clearly, this is not the IQD RV exchange scenario any of us want.
Bottom Line
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Without the off-ledger gold deployed to collateralize and back the IQD (Our GCR), there is no possible way that we will benefit from any non-GCR revaluation or redenomination of the IQD. Without Our GCR fully released globally, Iraq cannot support an RV at $1.00, much less $3.00 or higher.
- Awake-In-3D Website: Ai3D GCR RealTimeNews
- I’m on Telegram: GCR_RealTimeNews
- I’m on Twitter: @Real_AwakeIn3D
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