May 27, 2011
Proposal to raise zeros from Iraqi dinar
A. M. D. Jawad Kadhim al-Bakri
Usually Matqom financial authorities of b (Ministry of Finance) by using the (fiscal policy) in order to maintain the general level of prices, in addition to the use of all productive resources available in the local economy to reach a state of full employment, as well as supporting the march of economic development, and this is done through the use of power financial instruments of fiscal policy b (government spending, and taxes).
The Authority uses financial instruments to address these problems (inflation, recession, unemployment), which is usually self-styled (the gap inflationary and deflationary gap), which might be exposed to the local economy, in addition to their use is targeted to raise the level of growth in the country.
Thus, the fiscal authority has no right to influence money supply and demand as they are the powers of the monetary authority of the Central Bank.
History tells us modern economy that many of the countries of the world (which went through wars large Kaharpin Wars I and II or the collapse of their totalitarian as States of the former socialist camp) has proceeded to one of two things, either you change the national currency or remove a group zeroes them to return to the square of economic stability.
In the U.S. experience in Iraq after the fall of the previous dictatorial regime has the Coalition Provisional Authority to change the currency of the new Iraqi currency, but equal in value, which would not intentionally CPA to raise the purchasing power of the Iraqi currency against the U.S. dollar or other currencies.
This situation led to keep the Iraqi dinar is equivalent to (0.067) U.S. cents, which indicates a significant decrease in the purchasing power of the Iraqi dinar.
If what has lift (three zeros) from the Iraqi dinar, it will lead to increase its value to the (1000) once calculated value Almertbip to the number of zeros that have been filed, any box of cigarettes that were sold (1000) dinars possible purchase after the lifting of the zeroes dinar and one, a thousand dinars and modern can be obtained by the A pack of cigarettes.
In theory and when lifting (three zeros from Iraqi dinar), the purchasing power will rise to the U.S. dollar significantly to become one U.S. dollar equals (JD and a half) just so that the goods imported from abroad, worth before the lifting of the zeroes (1.2 million) Iraqi dinars, equivalent to ( 1000) U.S. dollars, will be worth after the lifting of the three zeroes (1200) Iraqi dinars, equivalent to (1000) dollars as well, and this will Igelb to remember any negative effects on the Iraqi citizen of the theory.
Positives raise zeros from the Iraqi dinar: The process of removing three zeros from Iraqi dinar deliberate, according to a tight monetary policy will lead to the following pros:
1. raise the purchasing power of the Iraqi dinar.
2. revalue the Iraqi dinar against other currencies.
3. increase the confidence of the Iraqi economy to foreign investors.
4. increase the confidence of the Iraqi citizen Bammelth National, which has become comparable to other currencies such as the U.S. dollar and the Jordanian dinar and the Kuwaiti dinar … etc..
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