Enorrste: Mike, four small points:
According to the CBI website the Gross Foreign Assets at the CBI as of May 25, 2017 totaled $53.4 billion.
Saleh has stated more than once that the dinar is or will be one of the strongest currencies in the world and a reserve currency:
Saleh said the Agency (news) said on Saturday: The dinar today has become a strong and like a hard currency through the Bank’s policy Central control of the cash raised in the local market.
He explained: that the dinar covered in hard currency at a rate of more than (100%), and this rare condition, and has a cash reserve large hard currency than for (60) billion dollars retained by the face of difficult circumstances that may occur in the country, giving the power of the dinar against foreign currency.
This statement was made in 2012 but he has reiterated it several times.
In February of 2014 he said this:
He said the appearance of Mohammed Saleh told the “time”, that “the Iraqi dinar is protected range is strong, and the cover of foreign currency is very high unless they are used for the purposes of reserves dedicated to the support of the Iraqi dinar.”
Admittedly he is looking to the future when he makes these statements. However, he is a member of the planet and an economist. Thus your statement that “There isn’t an economist or currency evaluator on the planet that states Iraq is or will be the strongest currency in the world” is a bit of hyperbole.
The Saudi Riyal is rated the 16th strongest currency in the world.
The dinars used to purchase foreign currency go directly to the CBI from the banks, since the banks have to get the foreign currency from the CBI in exchange for the dinars. Therefore, no one is saying that it “go[es] back to the banks to begin the cycle all over again.”
Mike: lol, Enorrste, I meant an objective economist, not a shill for the GOI. Saleh has said a lot of inaccurate things over years, we had a lengthy debate about this in 2015, he has problems with the facts.
The facts are that Iraq has roughly 60 trillion dinars, or say $52 billion dollars and the reserves are, according to Keywords, between $47-$49 billion. Additionally, the IQD, no matter what Saleh states, doesn’t even sniff the criteria for a hard currency like the dollar, yen, euro and pound. Here’s a snip, Iraq has none of the requirments, zero.
Hard currency is a currency widely accepted around the world as a form of payment for goods and services. A hard currency is expected to remain relatively stable through a short period of time, and to be highly liquid in the forex, or foreign exchange (FX), market. A hard currency generally comes from a nation with a strong economic and political situation.
Here’s a link for the reserve totals according to Keywords:
Iraq’s reserves do not cover outstanding M0 cash. Candidly, I’ve read where the reserves are at $42 billion but I thought I would use Keywords reference and link from the CBI. Do you happen to have a link that supports your figure of $59 billion? I’m also providing a link that shows the balance of the reserves at $45 billion.
I would also add that Gross Foreign Assets, or Net Foreign Assets are not the same as hard currency reserves, they encompass two different accounting procedures.
?Let me know if you can find one economist or currency expert outside of the GOI that will support the idea that the dinar is or will be in the near future considered a hard currency. I’ve looked and can’t find one. Stay grounded…
Punisher: Mike , so we are supposed to take everything Saleh says and throw it in the garbage?
Mike: When it comes to Saleh, I need confirmation. His comments about the dinar becoming a hard currency speaks volumes, he of all people know how powerful that statement is.
Yet, he states it multiple times in the media. Check it out for yourself, if my links don’t support my position just Google “what is a hard currency” and see for yourself. No country with 98% of their revenue derived from the sale of a commodity will ever be considered as a safe haven for currency.