Doc. Josh Posted February 16, 2011 Share Posted February 16, 2011 I have been having a major dispute for over two years in regards to the iraqi dinar. Im not a political person but i do know how money works and that theres no magical anything to become an over night millionair. Can someone anyone please let me know what this is all about? EX: some people say the iraqi dinar is going to revalue and their going to become instant millionairs and IMO i call this a complete waste of time and money. Along with all information ive read seems uneasy and non credible. Thanks in advance. Link to comment Share on other sites More sharing options...
Mr Skeptic Posted February 16, 2011 Share Posted February 16, 2011 It seems you can get rich quick, by selling Iraq dinars to gullible people. Not by being one of the gullible people who buy it. Link to comment Share on other sites More sharing options...
jackson33 Posted February 16, 2011 Share Posted February 16, 2011 Josh; As most National Currencies do, the dinar is traded on the open currency markets and yes probably for three/four years it's been of interest to speculators. The thought as I recall, started about the time Iraq was found to have a great deal of oil reserves, said to be second only to Saudi Arabia. In combination with what was thought to be a fledgling Democracy (of sorts) this would make a very good case for speculating on their economy. Personally, I would not invest (bet) on any currency, for a variety of reasons, among them the probability of manipulation and lack of confidence. What I might suggest first is to find an ETF that follows currencies in the Middle East or better yet, business in Iraq or the area. Link to comment Share on other sites More sharing options...
mississippichem Posted February 17, 2011 Share Posted February 17, 2011 #1 rule of finance: if it sounds too good to be true, it is. Currency markets (Forex) are already risky financial instruments. Even if you bet on lets say the BP/USD pair, two relatively stable currencies, you can loose your money quickly. The potential payout for the Dinar is huge, but the risk is proportionally huge. Link to comment Share on other sites More sharing options...
Doc. Josh Posted February 17, 2011 Author Share Posted February 17, 2011 I may be wrong here, correct me if i am. If the iraqi dinar was indeed true and it revalued at whatever amount, it would make a ton of millionairs here and in iraq? Wouldn't that cause hyperinflation? To my understanding if this was the biggest investment ever with the highest return wouldnt the (real) billionairs come up and put a considerable amount of money in this? But if that happend wouldnt it create to many billionairs or even trillionairs? This just seems impossible to me, people having enough wealth to pay off the deficit? My main point is these dinar investors are putting 2-3-4 thousand dollars and expecting a return or 500 million or better. This is not possible correct? Link to comment Share on other sites More sharing options...
Mr Skeptic Posted February 17, 2011 Share Posted February 17, 2011 I'd say it is "possible", but if it had even a remotely reasonable chance of actually happening, the banks and billionaires would be all over it. Playing this game is gambling against the pros in a game of skill that you don't even know how to play. Also, if someone could make the money in their country increase a few hundred thousand times in value they would have already done it. Link to comment Share on other sites More sharing options...
jackson33 Posted February 17, 2011 Share Posted February 17, 2011 Josh; In short the Government of Iraq or any Country cannot directly revalue or devalue their currency, but they can influence the value by any number of ways. Try this; If there are -X- dinar's in circulation and their GDP is 10TD on day one, then one year from day one, the GDP hits 20TD, while the available dinar's remains the same and price of goods and services had remained stable, the value per would have doubled. Since currencies are traded on margins (I'm not up to date on current regulations) say 10%, that 2-3-4K$ would likely have doubled and since on margin or controlled 10 times the investment. If sold then, your 4K$ investment would be worth 40K$. If your still with me, then the value of your currency had decreased on the World Market (important) then the purchasing value of that 40K$ would be in the current. Said another way if you believe your money will decrease in value (US$ down over the past ten years about 20%, depending on source of information), it's a hedge against that inflation. As mentioned, the combination of a Democratic Government and growth in GDP* in Iraq, while certainly questionable, it's also potentially explosive. Based on US$, from 2005 to 2009 it more than doubled, if they continue on a positive pace and we already know they have the second highest estimated oil reserves**, the long term potential is worth some study... * http://www.google.com/publicdata?ds=wb-wdi&met=ny_gdp_mktp_cd&idim=country:IRQ&dl=en&hl=en&q=iraq+gdp ** http://en.wikipedia.org/wiki/Oil_reserves I must also re-emphasize, there are other and less risky ways to invest in the future of any emerging market. Here is a good list to go over, including the dinar, penny stocks and ETF's... http://www.investorsiraq.com/showthread.php?138553-Is-Iraq-The-Next-Major-Emerging-Market-Iraq-ETF-Coming Forex, mentioned by mississippi, also has a practice format or you can play with a very low dollar amount, think 100.00 or so. One thing to remember though, on margin also works in reverse and once your invested amount goes down your investment money is lost. Even in other markets where putts/calls, longs/shorts or margins are involved, you really need to be a professional trader, to play. http://www.ac-markets.com/?utm_source=3&utm_term=forex+practice+account&gclid=CPa31IjXj6cCFYtS2goduTqqfQ&utm_medium=banner Link to comment Share on other sites More sharing options...
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