Don't WAIT!

Wednesday, June 3, 2015

Mnt Goat Wednesday Post "Mid-Week Update – June Already!"  Part 2 of 2

3) Last Weeks’ many, many amazing articles about the debate on the completion of the “project to delete the zeros” from Iraqi economists and experts. Also the controversy of when to distribute the new 50,000 and 100,000 notes as they confirmed to us (as we thought all along) this is directly connected to the project to delete the zeros. 

I have never seen so many articles on this topic before. Just by the volume of information and debate on these topics we see they are interconnected and we see they will soon make a decision to go ahead or postpone the project once again. We know for a fact that the rollout of the new 50,000 and 100,000 notes are interconnected with the project to delete the zeros. They can not rollout these new notes without this project being implemented (or well underway) since it would cause hyperinflation  to the value of the dinar, and is this not what they are trying to avoid at all costs? WE can easily see how 1166 rate can turn into 3600+ rate easily with these new notes in circulation  if the other 3 zero notes were not collected. This would be very. very bad for the economic reform and simply not going to happen.

So once if they begin issuing these new larger notes (to be used for inter-banking and very large transactions only) they MUST BEGIN THE PROJECT TO DELETE THE ZEROS and collect the 3 zero notes that remain in circulation, that means from us too……lol…..
The one news article we wait for from the CBI, is the one telling us they will begin the completion of the project and a timeline for the completion once again. I suspect this will happen in the coming few weeks from all the articles now on this topic. Dr Shabibi is now much more present (physically) in the CBI.  This will probably take a format similar to what happened in 2012.

4) A possible agreement on the needed “basket of laws”  (finally!)

I mentioned in my last news letter that these laws did not get passed in last weeks sessions and were being deferred until the next session. So the next day out pops this article telling us that may have finally agreed to these needed laws. I suspect they will vote on them as a high priority in the next session. Why is this important to us as  investors in the dinar? Because these laws are mandated by the UN and the USA prior to any significant increase in the value of their currency (implementing the project to delete the zeros). 

Article Begins:

DEPUTY STRESSES REACH A POLITICAL AGREEMENT ON THE NATIONAL GUARD AND THE FEDERAL COURT RULES AND PARTIES FOR APPROVAL      
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{Baghdad: Euphrates News} confirmed the National Alliance MP Iqbal Abdul-Hussein, said that "the political blocs, reached final agreements, laws {National Guard and the Federal Court, political parties} in preparation for approval during the next legislative term.

According to Abdul-Hussein told the News} {Euphrates that "differences and outstanding issues between the political blocs, on these laws were not significant, but the differences views only."
She said "the political blocs took a long time in Altabges and dialogue, to find a suitable and definitive version of those laws."

The House of Representatives legislative term ended yesterday without the completion of the National Guard of the Federal Court Rules and the parties to the presence of several differences between the political blocs around.
The President of the Council of Representatives Saleem al-Jubouri announced yesterday the end of the first legislative year, noting that the meeting yesterday, the last session after the extension of the Legislative Council for the second semester for a month

Article Ends

5) Opening of the 2015 Budget
Just in the recent days we read that one of the MPs from parliament are questioning the stalling of  the opening of the 2015 budget. It is the month of May already and almost 4.5 months since they passed the budget. Back in November of 2014 we read articles about hundreds of contracts being signed for reconstruction efforts. These contracts are due money now since they were planned to begin work now. So will they rewrite these contracts or what will they do? They must open the budget to pay them. They do not want to open the budget for this purpose since many of these contracts are in fact written in the new revalued rates. They need the RV. 

What we did not all know is that this article is telling us is why the budget is stalled. It also confirms to us that the budget HAS NOT BEEN OPENED as many of us spread rumors that it was.

It appears, from this article, that an appeal was filed in the courts by the GOI and the CBI by Abadi to postpone the budget spending. They now claim this appeal was unconstitutional.

But the really nice part of this article it was Abadi (with support from his cabinet and the CBI) who stopped it.

Why then stop it?
So this is confirming to us more and more that they are awaiting the completion of the currency reform to begin spending the large amounts of money on the government reconstruction.

So just in the last few days the minister of finance has stated that the 2015 budget money is about to be disbursed to each of the provinces. This is WOW news IF THEY ACTUALY DO IT !

Article Follows:

Parliamentary Finance: Government lingered implementation of the budget is unconstitutional      
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http://ift.tt/1RD6L4P

Finance Committee in the House of Representatives confirmed, Thursday, that the federal budget after the vote by the Council and published in the official gazette and signed by the President of the Republic became effective.

He noted member of the committee MP Ahmad Sarhan in an interview with "direction Press" that the appeals filed by the government and central bank to the Federal Court has issued instructions on them by the prime minister states to postpone implementation until decided by the Federal Court, and therefore, these instructions issued instructions to wait is unconstitutional and illegal.

He added that the executive can not point to ask to postpone non-implementation of the budget because it is a legal breach, pointing out that the legal department at the Iraqi Council of Representatives made the other call is against the government before the Federal Court the need to answer a lawsuit government is about to wait in the implementation of the budget.

It is noteworthy that the Iraqi Council of Representatives in the approved, 29 of January 2015, the financial budget for the current year, an amount of 119 trillion dinars, the equivalent of $ 117 billion, and a deficit of around 25 trillion dinars, or about 23 billion dollars, and calculates the price of a barrel of oil on the basis of $ 56 a barrel

Article Ends

6) Monthly HCL royalty $$ to citizens beginning now
Iraq plans to distribute oil revenue money to the citizens for the very first time as part of HCL implementation in June/July timeframe.

The finance ministry has also told us that for the first time they are rolling out regularly scheduled payments an so there will be reliable, accurate, on time payments on time each month in the future. Folks – I can not tell you just how important this is to the people of Iraq ! This is such good news ! Talk about making the citizens happy!

Why is this so important to us investors in the dinar looking for an RV?
It is important not because so much of the fact they must RV prior to allowing them to make these payouts. But rather because it is the one remaining last part of the HCL that is needed and mandated by the USA and UN in agreement with Kurdistan and the GOI in the Erbil agreement of 2009. Erbil must be FULLY implemented prior to bringing back the IQD online. This is why it is important and why I mention it today to you.

The USA has said this many times to Iraq in negotiations to fully complete their sovereignty as a nation. By they way they are not yet full sovereign until they have a global currency and can control their currency, contrary to what many think.   

So this why this event is so significant?  Another important condition of the Erbil agreement, no full Erbil implemtation, no RV.  Not much left for Erbil to be done.

Do they have to RV in order to pay them?  NO!  You tell me why because I do not know why.

First -The use of the new Mastercard  service (tied to the National SMART card) is like any debit card for these payouts. It will withdraw funds out of a government provided funding file allocated fund % each month to the citizens. There are algorithms calculating what the individual citizen will be allocated based on parameters of oil revenue and shares allocated to the provinces. 

Second - When international, the debit currency conversion is NOT dependent upon an RV. They do not plan to be linked to the global exchanges to do this conversion at the onset of any time in the near future.

Third – they are using Mastercard service to service these payments since these payouts are NOT dependent on the international rate of the dinar but rather on using a fixed rate for this program. Mastercard provides this flexibility.

The rate conversion is $1.13 USD per dinar as stated in the HCL agreement. You can convert it to other currencies too but they will use a fixed file for conversions. They do not want to pay the coming higher international rate on these oil royalties and so do NOT want to be hooked into the exchanges initially. Eventually they may be paying out market rates but this is not in the current rollout plan.

I also believe, however, that paying out the HCL royalties to the citizens will also ignite the necessity for a full  revaluation of the dinar to take place. First they will need this buffer period to transition to a much higher rate. They do not want the currency to implode.

Are you listening?

Peace and Luv To Ya All, 
Mnt Goat


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