Devalue, Delete, Revalue

UPDATE - Wednesday, October 7

After this briefing was produced, Iraq made the first move. The Council of Ministers approved a new rate in Tuesday's session and the Central Bank adopted it, effective today: 1,500 IQD to the dollar buying from the Finance Ministry, 1,510 selling to the banks, and 1,520 selling to the public.

Everything below, including the audio and the video, was produced while 1,500 was still a proposal. Read it with that in mind. The first step of the theory has now happened. The two that would follow it, the zeros and a higher rate, have not, and nothing in today's decision mentions either.

The test set out below still stands, and one part of it is already answered: the bank moved the rate itself. The street is the next thing to watch.

Wednesday, October 7. For the better part of this week one theory has been passed around the dinar community. Iraq lowers the IQD first, deletes the zeros, and only then raises the rate. Devalue, delete, revalue.

We saw it early and did not print it. On the first day it had one lawmaker and one leaked figure behind it, and we wanted to see what Baghdad itself would put on the record before handing it to you. On Monday and Tuesday we reported that nobody with authority over the rate had put a name to the number.

A reader wrote to us this week: "They sure are going back and forth with this." He is right. In 4 days Iraqis have been told that 150,000 is in the budget, that it will never be implemented, that it is subject to change, and that the zeros are postponed.

So today we stop following the headlines one at a time and lay the whole theory on the table. What has been said, who has the power to do each part of it, why a government would do it, and what would prove it wrong.