As Iran Rial Implodes By 20% In One Day, Follow The Death Of A Currency In Real Time

Tyler Durden's picture




 

Iranian clerics' attempts to curb speculation in the Rial and stabilize the currency appear to have backfired as the un-official (real) Rial rate traded as low as 34,250 Rial to the USD this morning - a massive 20% plunge. Demand for gold is surging (as Tehran exchange volume is up almost 18% today) as the population appears to be readying itself for hyperinflationary death - as we wrote yesterday, it really is no fun in Iran. The following tables/links will allow the real-time monitoring of that market's collapse - since Bloomberg's official rates are entirely useless.

 

Via Reuters:

The rial's losses have accelerated in the past week after the government launched an "exchange centre" designed to supply dollars to importers of some basic goods at a special rate slightly cheaper than the market rate.

 

Instead of allaying fears about the availability of dollars, the centre seems to have intensified the race for hard currency by linking the special rate to the market rate, meaning that even privileged importers will face sharply higher costs.

 

"The government's initiative ... brought to the surface a tremendous lack of confidence in its ability to manage the currency," said Cliff Kupchan, a Middle East expert at the Eurasia Group, a political risk research firm. "The attempt to fix it triggered a worse crisis via market psychology."

 

It appears that locals are extremely active in selling out of their Rials and moving it into Gold (implicitly via the USD we pre-suppose). The rates for Gold across markets and weights/scales in Iran can be found here - www.mesghal.com

 

For more details:

Open the following tables in a Chrome browser (and Translate)...

 

Gold market

 

and the un-official (real) FX Market...

 

Via www.mazanex.com

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Mon, 10/01/2012 - 10:44 | 2844993 fuu
fuu's picture

Bullish for the Iranian Misery Index.

Mon, 10/01/2012 - 10:46 | 2845008 Careless Whisper
Careless Whisper's picture

The Careless Whisper Morning News Update & Threadjacking

Candidates Agree: "Dancing With The Stars" Audience Could Determine Election

http://www.nytimes.com/2012/10/01/us/politics/political-ads-flood-dancing-with-the-stars.html?hp

EU New Car Dealers Selling 30% Of Cars To Themselves To Boost Numbers; New Cars Moved To Used Car Lots

http://www.bloomberg.com/news/2012-09-27/ford-says-european-dealers-selling-vehicles-to-themselves.html

Colaboración: USA And Mexico "Partner" To Push US Food Stamps For Mexicans

http://dailycaller.com/2012/10/01/obama-usda-met-30-times-with-mexican-govt-to-promote-food-stamp-use-among-mexican-immigrants/

CFTC Goes After Small Shanghai Trader; Too Much Speculation

http://shanghaiist.com/2012/09/28/shanghai_trader_made_510_million_be.php

My Franchise Had $1 Million A Month In Overhead; Regional Drug Cartel Manager Testifies

http://latino.foxnews.com/latino/news/2012/09/29/on-border-mexican-cartels-run-like-corporate-businesses/

"Garbage Cams" Used In School Cafetaria To Monitor Kids Throwing Veggies In Trash; School Admits "We do force-feed."

http://www.orlandosentinel.com/features/education/os-school-food-waste-20120930,0,1993800.story

 

 

 

 

Mon, 10/01/2012 - 10:50 | 2845025 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

New cars bought by dealers and moved to used car lots.

lol....americans are the cleverest of monkeys.

Mon, 10/01/2012 - 10:56 | 2845050 Popo
Popo's picture

So... does this mean "War: On"  (ie: The Iranians now need a war because their currency is imploding)

or "War: Off" (ie: The global Banking armada has been victorious.  No need for actual fighting).

?  Anyone ?

Mon, 10/01/2012 - 11:14 | 2845116 DeadFred
DeadFred's picture

I was just going to ask if I needed to get a new battery for my Geiger counter or if I could put it on EBay. Cornering a wild animal is a dangerous thing but if you want to put it in a cage sometimes you gotta do it. My gut says that .GOV rarely does things well so I'll bet on the 'War: On' scenario.

20% drop in a day- Ben is so envious.

Mon, 10/01/2012 - 11:21 | 2845146 kridkrid
kridkrid's picture

War for the sake of destroying their central bank... Off.
War for a destraction as all central banks implode... Still on.

Mon, 10/01/2012 - 11:07 | 2845086 MillionDollarBoner_
MillionDollarBoner_'s picture

CFTC Goes After Small Shanghai Trader; Too Much Speculation

http://shanghaiist.com/2012/09/28/shanghai_trader_made_510_million_be.php

but...but...but...it was a hedge...

Kudos, Careless Whisper

Mon, 10/01/2012 - 10:49 | 2845023 phalfa5
phalfa5's picture

Let them eat sand ....

Mon, 10/01/2012 - 10:51 | 2845029 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

You can bomb the world to pieces, but you can't bomb it into peace.

- Michael Franti

Mon, 10/01/2012 - 10:57 | 2845055 fuu
fuu's picture
still believing the systems workin'
while half of my people are still out of workin'
anonymous notes left in the pockets and coats
of judges and juries from 'Frisco and Jersey
threats and protests politicians mob debts
trumped up charges and phony arrests
Mon, 10/01/2012 - 11:00 | 2845069 Spastica Rex
Spastica Rex's picture

All the freaky people make the beauty of the world.

Mon, 10/01/2012 - 13:21 | 2845641 putaipan
putaipan's picture

love is the shit that makes life bloom..... never know when you might stepin it.....

Mon, 10/01/2012 - 10:55 | 2845045 Bay of Pigs
Bay of Pigs's picture

Yeah, and you'll be eating some dirt soon pal. 

Mon, 10/01/2012 - 10:44 | 2844995 jover
jover's picture

I hope the people of iran are a bit more clever to have bought gold than the average joe sixpack

Mon, 10/01/2012 - 10:48 | 2845016 CH1
CH1's picture

Me too.

The Iranain people are far better than their bosses. (I know, that's always and everywhere... just sayin'.)

Mon, 10/01/2012 - 10:55 | 2845043 john39
john39's picture

considering what the Iranian government is up against, they are not faring too badly.   Not many countries can stand up long to the full force of the US/NATO/zionist monster and live to tell about it.  Iran's government is still in the game.

Mon, 10/01/2012 - 12:42 | 2845449 SilverTech
SilverTech's picture

Maybe they should take the gold they're getting from Turkey and set up a Gold Rial.

Oil for gold.

Mon, 10/01/2012 - 10:45 | 2844998 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Iran....so far away....

....or maybe not?

Mon, 10/01/2012 - 10:45 | 2844999 CPL
CPL's picture

This isn't going to help anyone short on PM's.  LOL!!

 

I wonder if they did it on purpose to do just that?

Mon, 10/01/2012 - 10:45 | 2845000 malikai
malikai's picture

Demand for gold may be surging, but the games continue:

https://www.quantsig.net/live.html#?&charts=m24h,m4h

Mon, 10/01/2012 - 10:48 | 2845011 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Luckily for the Cartel they have rehypothecated an infinate amount of Tungsten, hidden the bars in vaults no one has ever seen, and made sure everyone focuses on such trivialities as Dancing with the Stars.

Mon, 10/01/2012 - 10:52 | 2845032 CPL
CPL's picture

<---  There is going to be a short covering on PM's.

<---  Give up on silver and trade beanie babies.

 

 

 

Silver scraping it's teeth on 35.  I like how the entire website is flashing red.  And people complain about western speculators.

 

 

Mon, 10/01/2012 - 11:12 | 2845109 Acet
Acet's picture

Not to worry, the BoE, ECB, FED and their minor central bank sideckicks are doing all they can directly and via the BIS to keep the price of Gold low so that the Iranians can get their hands of the hardest of hard currencies at a discount price.

The spectacle of seeing central banks spend hundreds of millions on dumping paper gold so as to crash the price, effectivelly subsidizing Iran, Russia and China on their Gold purchases is only outshined by the even better spectacle of seeing that the half-life of those interventions is getting shorter and shorter.

Mon, 10/01/2012 - 10:48 | 2845017 Aziz
Aziz's picture

"It can never happen here"

(Until it does).

Mon, 10/01/2012 - 10:58 | 2845063 machineh
machineh's picture

Next:

Since Cristina Kirchner first became president of Argentina, in October 2011, country's economy has gone from bad to worse. The Argentine economy has, for decades, been cobbled together by Peronist-dirigiste regimes that have employed mandates, regulations, price controls, subsidies, a great deal of red tape, and a wide variety of other interventionist devices, in an attempt to achieve their goals. It's all been kept afloat - barely afloat - by soybean revenues.

Seriously -- the official peso is kept artificially elevated 30% above the real (black market) rate.

Watch it crash soon ...

Mon, 10/01/2012 - 11:11 | 2845101 MillionDollarBoner_
MillionDollarBoner_'s picture

"the official peso is kept artificially elevated 30% above the real (black market) rate."

Now I'm confused...we talking pesos or reals?... s'plain, please ;o)

Mon, 10/01/2012 - 12:37 | 2845423 machineh
machineh's picture

Pesos -- see line 1 'libre' (official rate 4.69 pesos/dollar) and line 3 'informal' (black market rate 6.26 pesos/dollar):

http://www.ambito.com/economia/mercados/dolar.asp

Mon, 10/01/2012 - 11:30 | 2845205 Dr. Acula
Dr. Acula's picture

>"It can never happen here"

D'oh. It already did:

"The painful experience of the runaway inflation and collapse of the Continental dollar prompted[citation needed] the delegates to the Constitutional Convention to include the gold and silver clause into the United States Constitution so that the individual states could not issue bills of credit, or "make any Thing but gold and silver Coin a Tender in Payment of Debts."[" - http://en.wikipedia.org/wiki/Early_American_currency

Mon, 10/01/2012 - 10:51 | 2845024 CH1
CH1's picture

The US is not Iran or Uganda.

True!

Here, people believe that their oppressors are holy and righteous.

Mon, 10/01/2012 - 10:58 | 2845061 azzhatter
azzhatter's picture

they even willfully re-elect them

Mon, 10/01/2012 - 11:25 | 2845172 kridkrid
kridkrid's picture

No matter the outcome.

Mon, 10/01/2012 - 10:46 | 2845002 urbanelf
urbanelf's picture

Beheading speculators doesn't work?  Whodathunkit?

Mon, 10/01/2012 - 10:46 | 2845005 The Shootist
The Shootist's picture

Isn't their currency linked to petrol?

Mon, 10/01/2012 - 10:55 | 2845044 CPL
CPL's picture

Nope, well, sort of.  They have a central bank as well, they also have the same concerns about fiat.  The rial is backed with the exact same fun time stuff all other fiat currencies have, which is nothing.

Mon, 10/01/2012 - 10:48 | 2845013 Jason T
Jason T's picture

this reminds me of something LaRouche once said.. 1:00-1:45

http://www.youtube.com/watch?v=p3ng_ozfR4I

Mon, 10/01/2012 - 10:52 | 2845014 Dr. Engali
Dr. Engali's picture

We are doing it for the people man. If we can't bomb them into submission we will starve their poor..actually we will starve their poor then bomb them into submission.....

 

This country is just fucking evil.It sucks to say that, but there can be no other answer.

Mon, 10/01/2012 - 11:25 | 2845174 BandGap
BandGap's picture

This will force Russia's or China's hand, so to speak. It wasn't that long ago that the USSR propped up any number of satellite "states" with enough aide to make it look like the Soviet model was "working". I would not be surprised to see China step into "help" Iran.

Iran is not an island. It is doing the proxy work that is the envy of the free world. They have "friends".

Mon, 10/01/2012 - 10:52 | 2845020 Jake88
Jake88's picture

Does this increase or decrease chances of war?

Mon, 10/01/2012 - 10:52 | 2845035 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

I am sure Iranians will lay down peacefully in their graves while everyone in the Western world enjoys coffee and ice cream.

Mon, 10/01/2012 - 11:13 | 2845111 Bay of Pigs
Bay of Pigs's picture

Dont forget the hot dogs and apple pie.

'Murika..........FUCK YEAH!

Mon, 10/01/2012 - 11:09 | 2845098 Winston Churchill
Winston Churchill's picture

We are at war, just haven't declared it officially yet.

Assisinations,embargo's,cycber attacks, are all acts of war.

WAR.

Mon, 10/01/2012 - 12:48 | 2845481 CH1
CH1's picture

"Cyber attacks" are mostly bullshit. The overseers need reasons to kill the Internet, and CyberWar is the meme they're using. Anything with "war" appended to it scares the shit out of sheep.

Agreed on the rest.

Mon, 10/01/2012 - 12:01 | 2845259 Cruel Aid
Cruel Aid's picture

The question is about expansion. Same friggin war.

Mon, 10/01/2012 - 10:54 | 2845030 CrashisOptimistic
CrashisOptimistic's picture

As was pointed out yesterday, the hyperinflation story for Iran is likely wrong.

1) They have subsidized oil.  Sanctions can't raise the price of their gasoline they pay for internally because just 3 years ago they completed work on sufficient refinery capacity for ALL domestic consumption.  So no gas price increase.

2) Rents are internal.  Sanctions won't affect them.  No reason for rent price increases.

3) They have plenty of agriculture.  They grow their own food.  With gas prices for tractors down, there would be no particular increase in food prices, barring drought, and drought is not a sanction effect, nor is it certain there has been any drought -- nor is it certain China would not trade food for oil.

So this whole hyperinflation meme would appear to derive only from the purchase of iPhones, which, indeed, Iranians can't afford.  Seems unlikely this is a big part of the average Iranian's monthly budget.  More likely gasoline, food and rent dominate.

Mon, 10/01/2012 - 10:57 | 2845052 azzhatter
azzhatter's picture

Dear Mr. Dinnerjacket,

 

Saw your speech last week. Loved it, great content.

 

BTW- how did you get that inflation going so strong?

 

xoxo, Ben Bernanke

Mon, 10/01/2012 - 11:15 | 2845121 dwayne elizando
dwayne elizando's picture

^WIN^

Mon, 10/01/2012 - 11:00 | 2845073 CPL
CPL's picture

Maybe the Iranian government is playing the currency game and attempting to jump the que as the first horse at the glue factory.  Or maybe even they are switching over to a PM currency or strengthening their position in PM's.  Look of the volume of silver and gold requests.  Someone is attempting to hoover as much of the actual physical into their vault.

I agree, the situation doesn't warrant hyperinflation.  When countries kneecap their currencies over night with no varibles in place that make sense to lead into a 20% drop...very strange.

Mon, 10/01/2012 - 10:52 | 2845031 moonstears
moonstears's picture

Here I'll help....Amadinnerjackey must release the following to Reuters: "Due to Rial instability, immediately we'll be selling oil in US Dollars to prevent oil price inflation, until further notice." and for good measure add... "Oh, and we likee Israel, lots!". Their economy would improve dramatically and quickly.

Mon, 10/01/2012 - 10:53 | 2845033 azzhatter
azzhatter's picture

This looks like Bernanke's wet dream

Mon, 10/01/2012 - 10:53 | 2845037 EscapeKey
EscapeKey's picture

Tie the currency to gold or oil.

Job done.

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