Turkey just announced that all foreign investors or nonresidents are exempt from the withholding tax in the shares and bonds. Read the excerpt from the article below.
The changes, which include the abolition of a 15% withholding tax for nonresidents investing in shares and bonds, triggered a sharp recovery in Turkish asset prices and the lira currency.
I am sure Dr. Shabibi is aware of this tax break, and what a way to invest in Turkey, while living in Iraq and all the profit is tax free. What a concept. This is what we all need in Iraq Stock Exchange.
On another note.
The word on haffa street is the Iraqi government is looking forward to next years new budget, which is just a little over 90 days on 1 October. The rumor is that an influx of cash is on the horizon.
Could this be the new business foreign investment law that will be enacted then…we shall wait and see. It seems the Kurds in the north are not worried about the investment laws the way they have signed up several oil companies not as big as my favorite, ExxonMobil but it’s a start.
How long do you think it will take for the new amendments to take place on the Iraq constitution concerning the oil? If 90% of Iraq revenue is from the sales of discounted oil on the world market, I would be working on the new amendments to the Constitution quickly. I see no new developments on this at all it doesn’t mean that something is not going on behind closed doors, but I just wish they would hurry up and get the agreements made about the oil assets and revenue.
Do you still think we are close to an rv?
It has been reported that Iraq’s inflation rate is well over 100% and there is a strong desire from the Iraq Central bank to lower the inflation to a manageable level like the 10-15% very soon. Iraq could take the same step this country has just announced who will be introducing a new currency and lopping a few zeros.
I wonder if Dr. Shabibi reads the Financial Times.
The National Assembly Finance Committee, some directors of the Central Bank of Venezuela (BCV) and the Finance vice-minister believe those days when people deposited VEB 500,000 (USD 233) in their accounts and spent it all in an afternoon to purchase two pairs of shoes should be over.
After reading the above quote from this article I bet the Iraqi’s feel the same way.
You can read it here.
A good article about oil and petro dollars.
This is going to be a major problem for the Iraqi government.
I apologize for not posting regularly this week just been busy. Last week I had a question and I asked for people to write and answer it and I must say I received several replies that were close and some not so close. It was a good try and I appreciate everyone that wrote in.
Here is the question written below:
In early 2005 the Iraqi government and the Central Bank of Iraq (CBI) had deposited usd 5 billion in the Federal Reserve Bank in New York. The question is how did the CBI and the Iraqi government deposit the money in the Federal Reserve bank in New York. How did Iraq get the 5 billion usd to New York in an interest bearing account?
Now let me answer this question for all you in Iraq enthusiast. Back in 2005 the US government has you all know was sending plane loads of US dollars from the United States and delivering the US dollars in nice fresh printed money to Baghdad airport and then were moved throughout the country in Iraq.
Now to think that Iraq was sending the 5 billion usd back to the states after it had arrived in Baghdad is just not cost effective. So, the US government just opened an account with the Federal Bank of Reserve in New York and opened the account in Iraq government name and accredited the account 5 billion usd. No security to set up no plane loads of US currency very simple transaction thanks to the US government and making 100 million annually so it has been reported.
This a very interesting article coming from the United States State Department talking about Iraq. If you notice we are in 2006 and they sure mention CPA laws all over this article. I thought the CPA Laws were no longer in effect??!!
I sure like that sentence “are not allowed to engage in forward transactions in Iraqi Dinar for speculative purposes.”
The Iraqi Dinar currency is worthless outside of the country of Iraq. Your right it is convertible but only inside Iraq and that’s all. And what is the currency of choice for all those Iraqi private and state banks, do I need to say it again.
From the DOS Web site:
The exchange rate is generally determined on the basis of supply and demand conditions in the foreign exchange market. Banks may engage in spot transactions in any currency, but are not allowed to engage in forward transactions in Iraqi Dinar for speculative purposes.
You still think we are close to an rv?
I guess no matter how many times I say this on my blog there are people out there like the Dinar Forums that are still going to believe what they believe and that’s okay. Let’s look at one quote shall we.
For an example Good_Karma on the dinar forum stated this.
“Why would they even go to the pain of sending USD abroad in increments, after every IQD auction, to pay for debts. They have more than enough foreign currency reserves to take care of that. I think these are IQD being sent abroad. They need to sell IQD for USD, before they send the IQD abroad to ensure that the IQD has an equivalent USD reserves (from the sale).”
If you go back and read the thread you see that they are talking about the CBI auctions of the US dollar as reported by the CBI. It is true they are having US dollar auctions and transferring the US Dollar each and everyday directly from the Central Bank of Iraq.
However, here is the facts, the CBI is transferring US dollars to all the State and private banks through out Iraq, because that is what they (State and private banks) are using to transfer abroad to either make deposit or pay debt or anything else they would like to do with that US currency.
The reason the private and state banks are wanting the US currency is because as you well know it is a fully convertible currency in just about any country in the world, unlike the Iraqi Dinar which is worthless outside the country of Iraq.
Believe it or not!
I want to be clear I have no problems with the people in Dinar Forum World (DFW) it’s just that several of them are
well just looking in the wrong direction. I hope that they take my comments and really look into the CBI auctions.
So, that you will know just like my Colleagues and I have known going on 3 years now.
The new PM is going to start a curfew on 14 June. Hopefully, this will give the Iraqi Security forces an edge by keeping criminals off the streets at night and while the security forces conduct raids arresting the criminals and don’t forget the insurgents.
And hopefully the IED’s that are planted and mostly done at night, the curfew will curtail that type of activity.
The CBI is not transferring Iraqi Dinar to other countries. The only currency the CBI would be transferring is US Dollars or the currency of that host country. The reason is the other country can not exchange the Iraqi Dinar and convert it to their own host country currency.