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[size=24]KTFA Members "News and Views" Wednesday Night 4-24-19
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KTFA:
Samson: This is an article that Frank mentioned on the call he would like studied
The effectiveness of monetary policy in Iraq
15th April, 2019 by Ahmed Hazal
Monetary policy is one of the most important tools used by countries to deal with economic problems, whether at the level of growth, unemployment, poverty, inflation and monetary stability
There is no distinction between economic and monetary stability. Economic stability is linked to economic policy as a whole, This is different from the monetary stability, which aims to achieve balance in the exchange rate and safe levels of inflation rate and increase economic growth rates through monetary policy instruments, which naturally leads to economic stability if the response of the sectors.
The Central Bank of Iraq Law No. (56) of 2004 affirmed that one of the central objectives of the Central Bank is to achieve monetary stability. As a result of the non-response of the real sector to the variables of monetary policy, this reflects the structural imbalances in the Iraqi economy
....
After 2003, the Iraqi economy exercised the tools of transition to a market economy, which has certain principles and rules committed by countries. Monetary policy has used the most influential tools in the exchange rate, which is the currency's window in balancing demand and supply. This depends on oil revenues.
Public finance relies on (89%) of public revenues as in the budget of 2019 and more in previous budgets. The oil sector accounts for more than (60%) of GDP, and notes the structural imbalances in public finances first, in the economic sectors Second
These imbalances result in instability at the economic and monetary level. Thus, money supply is an internal variable of fiscal policy (as we always confirm) as long as the Ministry of Finance is responsible for selling the dollar to the central bank.
By reducing or increasing public spending, as well as that every rise in the budget deficit leads to an increase in money supply because public finances resort to the instrument of public debt (internal and external) to meet the needs of the budget, which leads to the occurrence of inflationary waves pushing monetary policy to fill them through Window Currency is the most influential instrument because of the low interest rate flexibility in the banking system as a result of the separation between the real and monetary sector
The monetary policy practiced the type of exchange rate nominally valid for monetary stability due to imbalances experienced by the economy
. Statistical data issued by the Statistics and Research Department of the Central Bank show that the exchange rate for the years 2015-2018 reached a maximum of 1190 dinars (1180) dinars per dollar. As for the parallel market price, the maximum limit reached (1281) dinars per dollar, while the minimum reached (1215) dinars per dollar
The foreign exchange reserve is a cover for the local currency and this ensures its stability and achieves development if it remains within the normative limits.
The data indicate that the reserves index is moving towards safety according to international standards and covers more than 6 months of imports in case of lack of oil revenues.Including the so-called double shock in 2014, namely, the sharp drop in oil prices on the one hand, and the military strike against the organization calling on the terrorist on the other. This necessitated the intervention of the Central Bank to achieve stability and to meet the funding needs to face the financial and military shock Indirectly through the marketing of public bonds
The reserves are not frozen, but are used in the management of currency and foreign cash investments, in addition to providing security for the national currency
If the demand for the dollar does not meet an equal offer, it means that it is one of the indicators of the collapse of the currency. Therefore, we note that the central bank is keen to cover domestic demand and demand for Import, and after 2015, I used a package of measures aimed at reducing the gap between my official and parallel prices
When the central bank sells the dollar, it aims to preserve the value of the currency, so it does not practice a commercial process as much as it activates its tools to achieve stability
The international standards stipulate that the difference between the official bank price and the parallel price (2%) should not be noticed. More than (8%) This is a serious indicator that threatened the value of the currency at the time, but now we note that the monetary policy was able to achieve convergence between the official and parallel exchange rates and a difference acceptable globally and according to the agreement signed by Iraq, which stipulates that the difference (2%), The official exchange rate for this year (1190) dinars per d This means the reduction of the gap to less than 2%.
This also means the monetary authority's affirmation of the need to reduce the gap as a result of its commitment to the Central Bank's law to achieve stability first and to raise the value of the local currency. It is possible for the citizen to benefit when buying goods LINK
Samson: Rafidain tomorrow will offer its financial services from advances and loans
2019/4/24 9:05
Rafidain Bank is preparing to present its activities and financial services from advances and loans to citizens and employees at the Faculty of Management and Economics at the University of Baghdad, on Thursday within the framework of the week of financial inclusion.
"The bank will participate in the financial coverage activities, which will start on Thursday at 9 am and will display its financial activities from advances, loans and other services," the bank's information office said in a statement received by the Al-Furat News. The bank called on "the media to participate and cover this important event." LINK
PattyCakes77: Do they need a rate for this to occur, anyone ? My mind boggles at the thought if it stays at a program rate. How can this be done
MilitiaMan: My thought is how important are day to day financial activities? Not so much, with out the new products to show off. With the new products (nscn's)? Now that will have the attention of the masses! imo ~ MM
Iobey777: WOW!!I CAN CERTAINLY SEE WHY DELTA PUT OUT THE RED ALERT YESTERDAY!! SO VERY EXCITING TO WATCH THIS ALL UNFOLD!!!
Samson: Halabousi calls on US companies to enter Iraq
24th April, 2019
The Speaker of the House of Representatives, Mohammed Halbusi, on Wednesday, US companies to enter the work in Iraq and contribute to the restoration of infrastructure for liberated areas or those that lack services.
The Information Office of the Speaker of the House of Representatives, in a statement received / Mawazine News / copy, that "Halbusi, received a delegation from the Committee on Foreign Relations in the Senate, including both Senator Mt Romney of the Republican Party, and Senator Chris Murphy of the Democratic Party, Chargé d'Affaires of the US Embassy in Iraq.
"The meeting discussed the continued security cooperation between Baghdad and Washington; to eliminate the cells of the organization calling for the terrorist, and to provide assistance; to return the displaced to the liberated areas and achieve stability." He called on US companies to "get into Iraq and contribute to the reconstruction of liberated or underserved areas."
For his part, the visiting delegation expressed "the aspiration of the United States of America to be a strong partner and prosperous; to play its regional role in the region," asserting "their support for Iraq in all fields." LINK
Popeye7: Looks like the government of Iraq is waving the RED FLAG... Very interesting timing of this declaration IMO...
Iggy: although it appears they have accepted Article VIII Obligations of the IMF, i would still like to formally see it, and it should appear something like this.
https://www.imf.org/en/News/Articles/2015/09/14/01/49/pr0602
IMO member states can work within the rules with other member states as long as it falls within the IMF framework...
(b) Exchange contracts which involve the currency of any member and which are contrary to the exchange control regulations of that member maintained or imposed consistently with this Agreement shall be unenforceable in the territories of any member. In addition, members may, by mutual accord, cooperate in measures for the purpose of making the exchange control regulations of either member more effective, provided that such measures and regulations are consistent with this Agreement.
https://www.imf.org/external/pubs/ft/aa/#top
IMO they have been working on this for a very long time and i feel it is so close i can almost taste it...
SteveP99: Very interesting and informative to the study!! What strikes me are the dates...The press release date is Jan 5, 2006 and acceptance of Art VIII was on Nov 8, 2005!! Makes one go hmmmmm….
****************
Maadee and Lyndee: Why do you think the Opportunity Zones have been released now? If this was part of the Tax Plan; why wait to release this information?
Apr 22, 2019, 08:34am
IRS Releases Latest Round Of Opportunity Zone Regulations: Where Do We Stand Now?
https://www.forbes.com/sites/anthonynitti/2019/04/22/irs-releases-latest-round-of-opportunity-zone-regulations-where-do-we-stand-now/#59ab4b027727
Samson: This is an article that Frank mentioned on the call he would like studied
The effectiveness of monetary policy in Iraq
15th April, 2019 by Ahmed Hazal
Monetary policy is one of the most important tools used by countries to deal with economic problems, whether at the level of growth, unemployment, poverty, inflation and monetary stability
There is no distinction between economic and monetary stability. Economic stability is linked to economic policy as a whole, This is different from the monetary stability, which aims to achieve balance in the exchange rate and safe levels of inflation rate and increase economic growth rates through monetary policy instruments, which naturally leads to economic stability if the response of the sectors.
The Central Bank of Iraq Law No. (56) of 2004 affirmed that one of the central objectives of the Central Bank is to achieve monetary stability. As a result of the non-response of the real sector to the variables of monetary policy, this reflects the structural imbalances in the Iraqi economy
....
After 2003, the Iraqi economy exercised the tools of transition to a market economy, which has certain principles and rules committed by countries. Monetary policy has used the most influential tools in the exchange rate, which is the currency's window in balancing demand and supply. This depends on oil revenues.
Public finance relies on (89%) of public revenues as in the budget of 2019 and more in previous budgets. The oil sector accounts for more than (60%) of GDP, and notes the structural imbalances in public finances first, in the economic sectors Second
These imbalances result in instability at the economic and monetary level. Thus, money supply is an internal variable of fiscal policy (as we always confirm) as long as the Ministry of Finance is responsible for selling the dollar to the central bank.
By reducing or increasing public spending, as well as that every rise in the budget deficit leads to an increase in money supply because public finances resort to the instrument of public debt (internal and external) to meet the needs of the budget, which leads to the occurrence of inflationary waves pushing monetary policy to fill them through Window Currency is the most influential instrument because of the low interest rate flexibility in the banking system as a result of the separation between the real and monetary sector
The monetary policy practiced the type of exchange rate nominally valid for monetary stability due to imbalances experienced by the economy
. Statistical data issued by the Statistics and Research Department of the Central Bank show that the exchange rate for the years 2015-2018 reached a maximum of 1190 dinars (1180) dinars per dollar. As for the parallel market price, the maximum limit reached (1281) dinars per dollar, while the minimum reached (1215) dinars per dollar
The foreign exchange reserve is a cover for the local currency and this ensures its stability and achieves development if it remains within the normative limits.
The data indicate that the reserves index is moving towards safety according to international standards and covers more than 6 months of imports in case of lack of oil revenues.Including the so-called double shock in 2014, namely, the sharp drop in oil prices on the one hand, and the military strike against the organization calling on the terrorist on the other. This necessitated the intervention of the Central Bank to achieve stability and to meet the funding needs to face the financial and military shock Indirectly through the marketing of public bonds
The reserves are not frozen, but are used in the management of currency and foreign cash investments, in addition to providing security for the national currency
If the demand for the dollar does not meet an equal offer, it means that it is one of the indicators of the collapse of the currency. Therefore, we note that the central bank is keen to cover domestic demand and demand for Import, and after 2015, I used a package of measures aimed at reducing the gap between my official and parallel prices
When the central bank sells the dollar, it aims to preserve the value of the currency, so it does not practice a commercial process as much as it activates its tools to achieve stability
The international standards stipulate that the difference between the official bank price and the parallel price (2%) should not be noticed. More than (8%) This is a serious indicator that threatened the value of the currency at the time, but now we note that the monetary policy was able to achieve convergence between the official and parallel exchange rates and a difference acceptable globally and according to the agreement signed by Iraq, which stipulates that the difference (2%), The official exchange rate for this year (1190) dinars per d This means the reduction of the gap to less than 2%.
This also means the monetary authority's affirmation of the need to reduce the gap as a result of its commitment to the Central Bank's law to achieve stability first and to raise the value of the local currency. It is possible for the citizen to benefit when buying goods LINK
Samson: Rafidain tomorrow will offer its financial services from advances and loans
2019/4/24 9:05
Rafidain Bank is preparing to present its activities and financial services from advances and loans to citizens and employees at the Faculty of Management and Economics at the University of Baghdad, on Thursday within the framework of the week of financial inclusion.
"The bank will participate in the financial coverage activities, which will start on Thursday at 9 am and will display its financial activities from advances, loans and other services," the bank's information office said in a statement received by the Al-Furat News. The bank called on "the media to participate and cover this important event." LINK
PattyCakes77: Do they need a rate for this to occur, anyone ? My mind boggles at the thought if it stays at a program rate. How can this be done
MilitiaMan: My thought is how important are day to day financial activities? Not so much, with out the new products to show off. With the new products (nscn's)? Now that will have the attention of the masses! imo ~ MM
Iobey777: WOW!!I CAN CERTAINLY SEE WHY DELTA PUT OUT THE RED ALERT YESTERDAY!! SO VERY EXCITING TO WATCH THIS ALL UNFOLD!!!
Samson: Halabousi calls on US companies to enter Iraq
24th April, 2019
The Speaker of the House of Representatives, Mohammed Halbusi, on Wednesday, US companies to enter the work in Iraq and contribute to the restoration of infrastructure for liberated areas or those that lack services.
The Information Office of the Speaker of the House of Representatives, in a statement received / Mawazine News / copy, that "Halbusi, received a delegation from the Committee on Foreign Relations in the Senate, including both Senator Mt Romney of the Republican Party, and Senator Chris Murphy of the Democratic Party, Chargé d'Affaires of the US Embassy in Iraq.
"The meeting discussed the continued security cooperation between Baghdad and Washington; to eliminate the cells of the organization calling for the terrorist, and to provide assistance; to return the displaced to the liberated areas and achieve stability." He called on US companies to "get into Iraq and contribute to the reconstruction of liberated or underserved areas."
For his part, the visiting delegation expressed "the aspiration of the United States of America to be a strong partner and prosperous; to play its regional role in the region," asserting "their support for Iraq in all fields." LINK
Popeye7: Looks like the government of Iraq is waving the RED FLAG... Very interesting timing of this declaration IMO...
Iggy: although it appears they have accepted Article VIII Obligations of the IMF, i would still like to formally see it, and it should appear something like this.
https://www.imf.org/en/News/Articles/2015/09/14/01/49/pr0602
IMO member states can work within the rules with other member states as long as it falls within the IMF framework...
(b) Exchange contracts which involve the currency of any member and which are contrary to the exchange control regulations of that member maintained or imposed consistently with this Agreement shall be unenforceable in the territories of any member. In addition, members may, by mutual accord, cooperate in measures for the purpose of making the exchange control regulations of either member more effective, provided that such measures and regulations are consistent with this Agreement.
https://www.imf.org/external/pubs/ft/aa/#top
IMO they have been working on this for a very long time and i feel it is so close i can almost taste it...
SteveP99: Very interesting and informative to the study!! What strikes me are the dates...The press release date is Jan 5, 2006 and acceptance of Art VIII was on Nov 8, 2005!! Makes one go hmmmmm….
****************
Maadee and Lyndee: Why do you think the Opportunity Zones have been released now? If this was part of the Tax Plan; why wait to release this information?
Apr 22, 2019, 08:34am
IRS Releases Latest Round Of Opportunity Zone Regulations: Where Do We Stand Now?
https://www.forbes.com/sites/anthonynitti/2019/04/22/irs-releases-latest-round-of-opportunity-zone-regulations-where-do-we-stand-now/#59ab4b027727
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