The talk is always the same as I discussed before, Monday, Thursday, this weekend. A tiring cycle of “intel” that repeats itself ad nauseam. But for some, it’s what gives you hope or hopelessness. We preached for years to live your life, don’t spend more than you can afford to lose, and don’t get caught up on the rollercoaster of what many termed as “news”. Unfortunately, we have to use far too many air quotes to describe things sometimes and it drains people, causes regret and depression, and frustrates really good people. I’ve watched over the years as I’ve caught up to old friends from chatrooms and heard how they moved on, sold their currency, and moved on to a different way to make it through their day to day. It’s always bittersweet to hear this. First, I’m happy they aren’t wasting time or life living on the edge for some bit of unproven information, but I’m also sad they had to give up their currency to be able to get to that place.
There are encouraging things that come out of the news, but again, understand the non-US news is a very different landscape. Particularly in the middle east where many news agencies are privately owned. What we do know is that a three year budget was passed, unfortunately, it hasn’t been opened and they continue to operate on borrowed money. The fact this was the first time in their history to actually recommend and pass a three year national budget left me feeling that something good could come of this. But, like previous years, the pattern of the budget legislation process has repeated itself. A delayed budget means deferring projects in a country plagued with serious essential services and investment problems. Such delays frustrate the citizenry, which has lost faith in the ruling political class. There is already much frustration over delays in passing the budget every year. Many Iraqis view the usual long political fights over the budget as a fight among political factions over their pieces of the big pie and protecting their interests. The budget also repeats problems in past budgets that were mostly spent on consumption and failed to build the economy. Around two-thirds of it, US$ 114 billion, goes to “operating expenses,” including the cost of running Iraq’s burgeoning bureaucracy, commodity subsidies, energy purchases, servicing the national debt, and salaries. The salaries of government employees make upward of US$ 58 billion, the largest single item, representing close to 40 percent of the total budget. The nation’s already bloated and barely productive public workforce of about 4.5 million persons added 720,000 new jobs. These new jobs are meant to appease a restive young population of college graduates and other job seekers seeking employment for months. These appointments further burden the nation’s rentier economy making reforms by weaning it away from oil dependence and diversifying revenue sources extremely difficult.
So the hope that the budget will open all allow the use of the currency in a way that will help build the infrastructure, all while allowing the citizenry to enjoy the fruits of the plethora of oil that exists to drive their economy.
[Chase Bank story] I went into Chase Bank to speak to the wealth manager… [I asked] Are you aware of the reinstatement of the Iraqi dinar? She looked at me and chuckled and said I just got out of a meeting on that…I started asking questions and she says, as a banker I cannot answer those question right now…personally I can tell you things are moving. She said, I will put you in my computer to call you in two months if I have not heard from you…. Funny thing about bank stories, so I got a random call from Chase bank a few months ago, the wealth management department of all people. Now I don’t anywhere have close to the funds needed to even invest with them but they said, “we’ve identified your account as a possible candidate for our assistance”. Do they know I have foreign currency there? Nope. Did I ever mention that when opening up my account or talking to a teller? Nope. So I can only assume that they are mass calling their database of customers in good standing to see what options they have. Could I turn that into a dinar story? Of course I could, but that’s not how I live my daily life. As I’ve told you, I’ve seen the bank memos, they know nothing. Curious point about the story though, if they just got out of a meeting, why would she call you back in two months? If they knew things were imminent, wouldn’t they stay in constant contact to make sure they kept your business? Just my thought.
BXXXX …redemption centers are ready. The rates have been coming up on the screens of banks and redemption centers…they are significantly higher at the redemption centers than the banks…And I think you guys will be more than pleased… Oh my gosh, the conductor of the rollercoaster. Let me lay out my idea of what a redemption center is since there is such a debate over whether they exist or not. This is MY hypothesis. A bank will be a location that will take your currency, ship it to a verification center, and then credit your account accordingly. I personally, will not be going to a location such as this. A redemption center IS A BANK that can validate and authorize your deposit on site, in your presence if so requested. Do I believe that these banks have their employees on standby and cancelling vacations because this is our weekend? NOPE. Strictly because a bank is a financial institution regulated by the national government. Do you think banks could afford the overtime they would have paid over the years for all the cancelled vacations and weekends on alert? Including the fact that some credit union employees (since some have said even credit unions) are unionized. With all the lost personal time, overtime pay and constant troubles that banks went through over the last couple of years, there would be an uproar about these items. Just doesn’t make sense. If they were on “high alert” as much as we’ve been told, you’d be getting overrun with phone calls for banks trumpeting about their wealth management departments and how they can help you.
Til next time,
BWM