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As Iran Rial Implodes By 20% In One Day, Follow The Death Of A Currency In Real Time
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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Bullish for the Iranian Misery Index.
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
New cars bought by dealers and moved to used car lots.
lol....americans are the cleverest of monkeys.
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 ?
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.
War for the sake of destroying their central bank... Off.
War for a destraction as all central banks implode... Still on.
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
Let them eat sand ....
- Michael Franti
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
All the freaky people make the beauty of the world.
love is the shit that makes life bloom..... never know when you might stepin it.....
Yeah, and you'll be eating some dirt soon pal.
I hope the people of iran are a bit more clever to have bought gold than the average joe sixpack
Me too.
The Iranain people are far better than their bosses. (I know, that's always and everywhere... just sayin'.)
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.
Maybe they should take the gold they're getting from Turkey and set up a Gold Rial.
Oil for gold.
Iran....so far away....
....or maybe not?
This isn't going to help anyone short on PM's. LOL!!
I wonder if they did it on purpose to do just that?
Demand for gold may be surging, but the games continue:
https://www.quantsig.net/live.html#?&charts=m24h,m4h
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.
<--- 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.
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.
The US is not Iran or Uganda.
"It can never happen here"
(Until it does).
Next:
Seriously -- the official peso is kept artificially elevated 30% above the real (black market) rate.
Watch it crash soon ...
"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)
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
>"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
The US is not Iran or Uganda.
True!
Here, people believe that their oppressors are holy and righteous.
they even willfully re-elect them
No matter the outcome.
Beheading speculators doesn't work? Whodathunkit?
Isn't their currency linked to petrol?
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.
this reminds me of something LaRouche once said.. 1:00-1:45
http://www.youtube.com/watch?v=p3ng_ozfR4I
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.
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".
Does this increase or decrease chances of war?
I am sure Iranians will lay down peacefully in their graves while everyone in the Western world enjoys coffee and ice cream.
Dont forget the hot dogs and apple pie.
'Murika..........FUCK YEAH!
We are at war, just haven't declared it officially yet.
Assisinations,embargo's,cycber attacks, are all acts of war.
WAR.
"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.
The question is about expansion. Same friggin war.
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.
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
^WIN^
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.
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.
This looks like Bernanke's wet dream
Tie the currency to gold or oil.
Job done.
The theoretical basis for tying a currency to gold has always failed.
What happens if you load up a few tons of gold on a rocket and fling it into the sun? Are you then required to reduce money supply in the world? How would this be consistent with economic growth derived from population growth. The theory has to make sense in all theoretical circumstances and making gold disappear thus destroys the theory.
If population grows faster than gold comes out of the ground, how can this make any sense? Does the standard of living of those people decline because trucks bringing spare parts to mining equipment got a flat tire enroute to the mine?
Sorry, it all just doesn't work.
Yes, because United States really suffered during the years 1870-1910.
If deflation was such a horrible phenomena as the Keynesians claim, then no-one would ever buy electronics.
Total quantity matters little. What matters is people's relative purchasing power.
Deflation only sucks for the rich and the banks that is why it must be held off no matter what.
spot on Doc .. else the 10000xXx leveraged positions will collapse.
And Basel III is talking about leverage ("Limit") good luck with that!
How exatly does "deflation suck for the rich"? Deflation is absolute reward to those with savings and pure hell to those with debt. If you fall into the gap with no significant savings or debts, then you are honestly not impacted. Prices fall, but so do your wages. Debts stay constant and become impossible to pay off, and those with savings are now rewarded greatly. It's also a self-feeding monster, as deflation is a impetus to save every penny because it will be worth more tomorrow.... which leads to more deflation. No investment either, as any investment made today, can be made tomorrow for cheaper.
Despite personally falling into the "saver" category, I would still not see any of this as a good thing. Nope, no debts for me either. However those who are oligarchs today would become demigods tomorrow. The only way to combat it in a meaningful way is to pull a North Korea on it with a limited revaluation. New currency, 10(0) old units become 1 new unit, limited exchange of XX units per person to be transacted wtihin specified date. Lockdown on all capital outflows, forcing domestic spending of cash that is otherwise about to become worthless. In effect forcing a stimulus to the domestic economy to hire/pay higher wages/produce to fill that demand. Speculation will be rather limited, as exchanges will more or less instantly price it in. Money becomes worthless and valuable at the same time. Balance is restored in society.
How exatly does "deflation suck for the rich"? Deflation is absolute reward to those with savings and pure hell to those with debt.
Well, I wouldn't go so far as to say "deflation SUCKS" for the rich, but you have to keep in mind that the rich have the vast majority of their wealth tied up in real assets. When deflation is in effect, the valuation of the assets themselves will fall.
If I'm worth $5000 and it's all in savings and I have no debt, deflation is great.
If I'm worth $5B and $4B of my worth is in real estate and gold and fine art, what happens when serious deflation hits?
My ability to convert those $4B in "assets" becomes ability to convert them into *fewer* dollars.
This can be called "sucking" depending on your perspective. Of course, you can always just say, "It doesn't matter how many dollars a bar of gold buys--it's still a bar of gold," but inflation/deflation doesn't generally apply to all asset types equally, and if you're in the wrong assets, you can easily see your real "net worth" fall dramatically.
Well, the problem with that logic is that if you're worth $5b and $4b is tied up in assets that, say, after deflation are now only "worth" $400m. What happens is the technical value of those assets are still the same, while that leftover $1b in cash is now more like $10b in terms of buying power compared to the rest of the world. Either way, that pile of assets that are now only worth $400m, can easily be tripled in size with that remaining $1b, while it could not have been before. Those non-hard assets which are debt-based magically become impossible to ever repay, but seeing as you own the lawmakers, you're sure as shit gonna get repaid ever last penny of it.
You're looking at money as if numbers are all that matter here. It's just a placeholder for buying power. If buying power increases, that's an increase, plain and simple. Now if, on the other hand, you're loaded up with debt (like basically every household in the US), that $50k a year job is suddenly only pulling in $5k a year. Sure, the buying power is the same as the $50k, however this funny thing happens where that $200k mortgage you were repaying STAYS at $200k and not only is it impossible to repay, but you can't even afford the interest. Ditto on student loans, credit cards, and basically everything else. If the value of the debts were smashed down to accommodate for the deflation, it's not a big deal, but that's something that would never happen in a capitalist society.
Meanwhile, if the same exact policies are not enacted by basically every other country in a unified effort, you end up with zero jobs anyways. Hell, you now get 63 RMB per dollar instead of 6.3. Wages in China are still the same, and even if your workers are now only $2 an hour, good luck convincing someone that's a good idea. You end up killing all your export, killing every single job that can be offshored, and turning your entire populace into a land of slaves that no one wants to use. Which in turn, only causes deflation to deepen, making the rich richer in terms of real wealth and intensifying the utter chaos of the spiral. No, pretty sure that qualifies as a "bad thing".
How is that related to your call for tying currency to gold? How is that not total quantity specific?
Iran have <x> base money.
Iran have 907 tons of gold.
x/907 tons
It does mean you can't trivially expand the money supply, but it would arrest the development of inflation.
Oh btw, as for it "always failing", fiat currency have a lot longer history of historic failure, and the reason for gold's usual reason for not working comes down to poor policy rather than gold itself.
It's very difficult to finance a war, or endless welfare, say, when you're actually being held to account.
Deflation due to technological inflation/increasded productivity is a completely different beast than deflation due to a fixed money supply.
Never understand why people confuse the two.
The period after the Civil War was called "the Great Depression" at the time it occurred.
People apparently DID think they were suffering, but I guess you'd know better.
Note that this is per capita.
http://aneconomicsense.files.wordpress.com/2012/07/long-run-us-gdp-per-c...
Uh...relevance?
http://cdn.theatlantic.com/static/mt/assets/meganmcardle/infogrinfograph...
Relevance? Is that a joke? If you can't see the relevance of rising GDP/capita in a discussion about gold and living standards, then I guess there's not much point in having a discussion at all.
If you load up a few tons of gold anf fling it into the sun... then you're an idiot. Don't you love strawman arguments? I do.
Did a Stuxnet virus infect the FOREX markets?
Seems that Israel doesn't get the US blessing for a military strike, so it's back to good old fashioned regime destabilization again, the oldest trick in the book.
Green revolution part II: the Persian Autumn.
Something else. There aren't many on the planet that are even allowed to go near the Iranian markets even by proxy of a holding company. This is internal, someone is preparing for something. The charts and orders are pretty much in a sand box called Iran. Not all "emerging" markets are accessible to anyone but the residents of the country.
There is something we did to Japan to provoke them into attacking us ..something finanically.. I cant remember what exactly.
Not a good analogy.
The Japanese were grabbing for oil in northeast China and fighting a war there. FDR cut them off from all US oil exports in Aug 1941 (the US was the Saudi Arabia of the world then, exporting lots of crude oil (not "petroleum products", proper crude).
Japan had to have another source of oil and the only such possible was Indonesia, supplies from which the US Pacific Fleet could interdict, so they somewhat were forced to attack Pearl Harbor.
Cutting off Iran from oil imports, as your analogy suggests, is meaningless. They import none.
Oil AND iron ore,steel scrap.
They decided to grab those resources from their neighbors but had to take out
the US Pacific fleet.
The similes with the current situation are great.We should not be pushing the Iranians so hard.
They are keeping their heads so far, inshalla.
The US gets a preview of things to come...
ori
Here's the deal: Obeyme thinks he's hurting Iran with sanctions. Bullshit. China is still buying as much oil as ever, and will continue to do so.
The ultimate effect of 'sanctions' will be to completely and forever cut the US and EU off from Iranian oil. China (and most likely Russia, along with Venezuela) will quench it's thirst for decades. Merka will need to drill her own.
Ruh roh. Oh, that's right, we still have the Military Industial Complex. We'll stop their 'nuke' program. Then, we'll just TAKE their oil. I get it.
tyler, why hasnt iran moved to a gold standard already????
http://www.zerohedge.com/article/secret-iran-gold-holdings-leaked-tehran-holds-same-amount-gold-united-kingdom-and-buying-mor
Strategery I would imagine. Why start giving up their gold when they don't have to yet?
yes, better to wait until the currency is complety wiped out......really sounds like a sound strategy for sound minds..........
"The ultimate effect of 'sanctions' will be to completely and forever cut the US and EU off from Iranian oil. China (and most likely Russia, along with Venezuela) will quench it's thirst for decades. Merka will need to drill her own. "
I think you have made the common mistake.
God knows how it has become common, but it has.
Russia, not Saudi Arabia, is the biggest oil PRODUCER in the world. They extract more oil from the ground per day than the Saudis. They have no need for Iranian oil. China does, and their need is getting greater and greater (hence the fight over the Senkaku Islands), but Russia is sitting pretty and is likely very quietly the dominant power in the world today. (Notice how Syria has not been attacked by NATO)
2nd sentence: China () will quench its thirst for decades. (I knew if I threw Russia in it would be a mistake)
The sad thing is, there's no need for any war (as far as Iran, China are concerned): Merka is only a year or two from self-implosion.
Their best option is to sit back with a good bowl of popcorn. It'll all be over soon enough. (But Merka won't let THAT happen)
The point is, Iran/China will be in bed together, roving each other rong time.
Merka is cutting its own throat.
yesterday's "source": Cato Insitute: Koch Brothers
today's "source": Reuters: The Rothschilds
Them's sure some reliable and unbiased sources on anything Iran, that's for sure. Thanks ZH for helping all of us understand the truth of the matter.
A false story to create more confusion?
Entirely possible.
How many ships (targets) are in the Persian Gulf? You back an animal into a corner. Be prepared to be attacked. Animals and humans are the same. The powerful will sacrifice their slaves for one more day of power. Between Iran frustration, Israel fear, and American arrogance, somebody is going to kill somebody soon!
I thought the Iranians were going to put us all in our places ? Where's Falak Pema ? Where's your Iranian equivalent of Ludwig Von Mises ? Frothy !
I would love to be a fly onthe wall of the Whitehouse and of the mullahs. Somehow I think they would have much in common.
Considering that Israel and its whores, UK & US, have been waging war against Iran for some years now this is no surprise.
It's no surprise to us .... we're the perps !
Guvments always find a way around sanctions.. it's the peoples/kids who suffer. Global suffering at record high for the peoples via the nobel prize winner and the polls say they Want More!
Why are they not banning the spam accounts in ZH?
they must dancing in the streets in Israel
Hopefully, they'll soon be choking in the streets in Israel. After massive amounts of chemical weapons land around them, that is!
"The western Afghan city of Herat has become a thriving hub for the money exchange business, a consequence of geography and politics. Money-changers throng the currency market carrying thick stacks of Iranian currency, much of it brought in by the hundreds of thousands of Afghan workers who earn their living in Iran."
http://www.npr.org/2012/09/28/161959942/cant-change-your-money-in-iran-try-afghanistan
The headline could have read.."Not content with having deliberately caused the hyperinflation that collapsed the Weimar republic and led to WW2, the Rothschild zionists are at it again, trying to collapse another currency, set off another war and bring more suffering on millions of innocent people."
ohhh right it's the rothschilds, not Iran's piss poor government. gotcha.
Which we and the Limeys have been fucking with probably since Darius. Blowback, dude. Happens to the best of empires. Fairfax is doing it's best! Every day in every way they're getting better and better. Better things for better living through nation building. Support your local stormtrooper. Like Evelyn and the queen haven't been a presence in the hood?
Give me a heads-up when I can follow the death of the Iranian regime in Real Time.
2009 got my hopes up but, alas, didn't deliver.
Now Iran gets to live under the Obama financial regime just like us Americans.
This is bullish for regime change! When Iranians can not buy i-phones or i-pads or load up on "Angry Birds" apps then the counter revolution will begin. The Iranian people want a pro USA leader who will open the country to US corporations who will create jobs. They also want to be allied with Israel in their struggle to survive in their native land against the enemies of Israel.
A new Shah with a pro USA regime will be hailed by the population yearning to work for US off shoring corporations and yearning to be i-phone owners. They also will open their borders to friendly US military bases designed to keep Iranians safe from terrorism. Several USA airbases and a naval base to keep the gulf open will be a top Iranian priority, The Iranian women can also work as whores to service the vast crews of US carriers. More jobs means more i-phone apps. Iranian whores will be liberal and pro USA. It is shown that once women achieve status in the economy they can swing society wawy from religious fundamentalism and towards liberal social agendas.
Gay marriage, egaual pay for equal work, education equality and free entery into the work place. Also women will be allowed in Iranian combat units that fight side by side with their allies the USA and Israel defense forces. Iran may even be allowed to be covered and protected by the Israeli self defense nuclear weapons shield of hundreds of bombs targeted on terrorist networks and enemies of freedom.
I think a collapse of Iran's economy will be the trigger to get Iranians to take to the streets to demand a liberal revolution, end the religious rule and allow for a USA style society. This will also provide a giant new market for Apple. FoxCon in CHina will ramp up production to service the masses of newly free Iranians yearing for their own i-phones.
CIA must figure that if ^P is working so well for Amerika, why not try it out on Iran.