18DELTA CHAT

18 Delta - Explaing our Investment
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18DELTA says to (15:38:26):
NOW I KNOW FOR A FACT THIS SOB IS GOING TO RV. NOW THE DAY? THAT IS ANOTHER STORY. IS THE CH INFO TRUSTWORTHY? YES IT IS. BUT UNTIL IT GETS RESOLVED AND MALIKI RELEASES IT. WE NEED TO GET ALONG.
AND THE REASON FOR NOT GETTING ALONG IS YOU ALL ARE NOT BUSY OR LEARNING. SO I AM GOING TO TEACH YOU ABOUT THIS INVESTMENT.

WE WILL GO FROM ALMOST THE BEGINNING SO YOU REALLY UNDERSTAND AND CAN SPEAK CONFIDENTLY ABOUT THE IQD LIKE I DO. I WILL START WITH THE IMF/IRAQ RELATIONSHIP. WHICH LASTED ALMOST 5 1/2 YRS. IT IS AS MANY OF YOU CALLED IT WAS THE SBA... STANDBY AGREEMENT. THE SBA WAS FUNDS THAT WERE AVAILABLE TO IRAQ BY THE IMF FOR STABILIZATION LOANS WHICH IRAQ NEVER USED ON PENNY OF.

NOW THE ACTUAL PROGRAM THAT IRAQ WAS UNDER WAS CALLED THE STABILIZATION PROGRAM FOR DEVELOPING COUNTRIES. WHAT WAS THAT PROGRAM ABOUT? IT IS A ECONOMIC AND MONETARY POLICY THAT WAS USED TO REDUCE INFLATION AND IMPROVE ON THE MAIN SECTOR OF REVENUES FOR THE COUNTRY OF IRAQ.

FIRST THE ECONOMIC WAS TO DIVERT ALL AVAILABLE FUNDING TO THE OIL DEVELOPMENT TO GENERATE REVENUES, TO KEEP THE GOI RUNNING AND ALLOW FOR SOME INFRASTRUCTURE DEVELOPMENT. BUT IN DOING SO HEALTH AND SOCIAL WELFARE AND EDUCATION PROGRAMS WERE STRIPPED OF MONEY. UNDER THIS POLICY UNEMPLOYMENT IS STILL HIGH THOUGH THE IMF PROGRAM DID A GOOD JOB IN ACTUALLY REDUCING THE 30 PLUS % UNEMPLOYMENT DOWN TO 18% BY THEN END OF THE SBA.

NOW NEXT IS THE MONETARY POLICY. THERE ARE ONLY TWO TYPES OF MONETARY POLICIES, CONTRACTIONARY AND EXPANSIONARY. THE IMF UNDER THIS PROGRAM USES A CONTRACTIONARY POLICY. THE REASON FOR IT IS TO INCREASE INTEREST RATES. STABILIZE THE CURRENCY PEGGED AGAINST THE USD AT A RATE OF 1/4% OF 1% MONTHLY AGAINST THE USD UNTIL JULY OF 08 WHEN IT WAS INCREASED TO 1/2 OF 1%. THE MAIN GOAL OF THIS POLICY IS TO REDUCE OR COMBAT HYPERINFLATION.

THE CENTRAL BANKS JOB IS TO REDUCE THE ACTUAL PHYSICAL CURRENCY WITHIN THE BORDERS OF IRAQ. BUT TO AUCTION OFF CURRENCY TO GENERATE REVENUE AND TO SELL OFF TBILLS AND CBI BILLS AND TO TRADE FOR FOREIGN CURRENCY ASSETS WHICH WILL BE EVENTUALLY USED TO PROTECT THE SUSTAINABILITY OF THE RV. NOW MANY OF THE STABILIZATION PROGRAMS FAIL WITH THE IMF FIRST TIME.

TURKEY, SOUTH KOREA AND ARGENTINA ALL DID, BUT IRAQ WAS TEXTBOOK SUCCESS UNDER THE IMF, AND ON MARCH 18TH WHEN THEY WERE RELEASED FROM THEIR AGREEMENT WITH THE IMF. THEY WERE TO GO TO PHASE II, WHICH WAS TO IMMEDIATELY CHANGE TO AN EXPANSIONARY MONETARY POLICY AND CHANGE TO A MARKET ECONOMY. WHICH BY THE WAY IS ACTUALLY PART OF THE IRAQI CONSTITUTION. IT CALLS FOR IRAQ TO HAVE A MARKET ECONOMY. YET THEY ARE IGNORING IT. NOW HEY DID NOT DO THIS. THEY CONTINUED TO AUCTION OFF IQD AT AN ALARMING RATE, MALIKI, HASHEMI, AND PARLIAMENT ASKED THEM AND ACTUALLY PLEADED WITH THEM FOR SEVERAL WEEKS TO STOP THE AUCTIONS. BUT THEN IT ALL WENT AWAY. THEN SHABIBI CAME OUT AND EXPLAINED WHAT HE WAS DOING.

THE AUCTIONS AS OF JANUARY WERE NOT FOR JUST REVENUES TO SUBSIDIZE THE IMPORTS THAT WERE NOT ALLOWED UNDER THE DFI. HE WAS USING DIFFERENT FORMS OF A MANAGED FLOAT TO CONTROL THE RATE AT 1170 AGAINST THE VOLATILE USD, WHICH HAD DROPPED .22 CENTS IN THE PAST YEAR. YET HE WAS ABLE TO KEEP THE IQD FROM PLUMMETING. AT THE SAME TIME CBI WAS REMOVING THE COUNTRIES DEPENDENCE ON THE USD. THEY WERE SLOWLY REDUCING THE LIQUIDITY ABROAD AND THE OVERAL USE OF THE USD FOR PURCHASES AND ENCOURAGING IRAQIS TO USE THE IQD INSTEAD.

NOW IT WAS HARD TO USE THE IQD SINCE THE ONLY WAY IT IS OF ANY USE IS TO PURCHASE SUBSIDIZED GOODS AND SERVICES. NOW THIS POLICY OF REMOVING THE USE OF USD WAS FINALLY DONE AND FINISHED BY THE 1ST WEEK OF OCTOBER 09. NOW INSIDE THE WIRE YES THE USD IS STILL USED AND IT IS ON THE BLACK MARKET AND THE AUCTIONS NOW HAVE VERY LITTLE TO DO WITH REVENUES FOR SUBSIDIES. THEY ARE ALMOST TOTALLY FOR THE MANAGEMENT OF THE IQD. THEY HAVE TRANSFERS OUT AND USD IN. NOW AS YOU KNOW MANY TIMES THERE IS NO USD. THAT MEANS NO IQD WAS AUCTIONED OFF. THE TRANSFERS OUT ARE FOR TBILLS AND CBI BILLS THAT THEY ARE PAYING OFF, AND FOR THE SWAP OF FOREIGN CURRENCY FOR FOREIGN CURRENCY ASSETS.

NOW RIGHT NOW IRAQ IS AT THE BRINK OF SOME MAJOR CHANGES. THE CBI HAS APPROVED AN RV. IT HAS BEEN HANDED OVER TO THE GOI, WHICH MEANS MALIKI. WHEN OR THE REASON THAT MALIKI WILL USE THE RV TO HIS BEST ADVANTAGE ONLY HE KNOWS.

NOW GOING BACK IN TIME, THERE ARE OR WERE SEVERAL MAJOR PIECES OF LEGISLATION THAT IRAQ NEEDED TO PASS. 1) HCL OR HYDROCARBON LAW, WHICH ENTAILED TWO PARTS. THE FIRST PART WAS THE REVENUE SHARING OF THE OIL SALES FROM KURDISTAN AND WHAT WAS FARE IN THE GOI AND KURDS EYES AS A SPLIT. WELL IT HASN'T GONE WELL. THIS SPRING IT WILL BE 3 YEARS THAT THE LAW HAS NOT BEEN ACTED ON. SO TALIBANI (PRESIDENT OF IRAQ) AND THE OIL MINISTER DID A SEMI SETTLEMENT. THEY OPEN UP THE PIPELINES AND SAID THAT 83% GOES TO THE GOI AND 17% STAYS WITH KURDISTAN. THEN PART II WAS THE OIL LAWS THAT DEALT WITH FOREIGN INVESTORS IN THE OIL INDUSTRY AND THEY BEING PROTECTED. SEE ALL OIL IN IRAQ IS NATIONALIZED, WHICH MEANS THE GOVT RUNS AND OWNS IT. AND, THE GOI WAS ONLY OFFERING 49% OF CONTROLLING INTEREST TO COMPANIES WHO WANTED TO INVEST IN THE OIL INDUSTRY WITH NO GUARANTEES THEY WOULDN'T OR COULDN'T BE BOOTED OUT AT ANYTIME AFTER PUTTING BILLIONS INTO IRAQ FOR OIL REFINERIES, ETC.

SO NO ONE JUMPED AT THE DEAL. AND IT WASTED ABOUT 3 MONTHS BEFORE IRAQ GOT THE HINT. THEY PASSED AMENDMENTS TO THE CURRENT OIL LAW THAT ALLOWED FOREIGN INVESTORS TO HAVE UP TO 75% CONTROLLING INTEREST. SO NO ONE JUMPED AT THE DEAL, AND IT WASTED ABOUT 3 MONTHS BEFORE IRAQ GOT THE HINT. THEY PASSED AMENDMENTS TO THE CURRENT OIL LAW THAT ALLOWED FOREIGN INVESTORS TO HAVE UP TO 75% CONTROLLING INTEREST. THEY COULD LEASE FOR UP TO 20 YRS. THEN THEY GOT PEOPLE TO COME IN.

WELL I THINK I WILL LEAVE IT AT THAT FOR NOW. I THINK THAT IS ALLOT TO DIGEST. I THANK YOU FOR YOU PATIENCE. GOOD BYE.