• Steve H. Hanke
    05/04/2016 - 08:00
    Authored by Steve H. Hanke of The Johns Hopkins University. Follow him on Twitter @Steve_Hanke. A few weeks ago, the Monetary Authority of Singapore (MAS) sprang a surprise. It announced that a...

Gold In Iran Soars By 23% In One Week As All Currency Transaction Tracking Disappears

Tyler Durden's picture


Just over a week ago we we were the first to shed light on the reality of hyperinflation on the ground in Iran - and subtley suggested the whole thing could be watched in real-time. Soon after, a mysterious cabal of 16 currency manipulators was arrested and the Rial jumped dramatically higher (according to official sources) - as if by magic there was no problem at all. This all sounded a little too good to be true (just like unemployment rates in slightly more controlled economies). Sure enough, by the power of social media, we now know it was too good to be true.

As open-market foreign exchange rates - not just Rial-to-Dollar - have disappeared from the major currency exchange sites, as trade has reportedly slowed to near suspension after the Central Bank 'imposed' a rate of 28,500 Rials to the USD this weekend.

Critically, though, via EAWorldView, while the 'real' rate for the Irainian Real is effectively blacked out, gold prices continue to soar. 'Old gold coin' is now selling for 16 million Rials, up 23% from the pre-suspension 13 million Rial levels - even as the

Central Bank tries to suppress reality (especially to the rest of the world's gaze) as hyperinflation continues - though less transparently.

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Tue, 10/09/2012 - 08:28 | 2870267 VonManstein
VonManstein's picture

looks like its breaking higher in $$ too.

A few setups within setups long XAU XAG


Tue, 10/09/2012 - 08:33 | 2870279 GetZeeGold
GetZeeGold's picture



How do you say gold bitchez in Farsi?


Tue, 10/09/2012 - 08:37 | 2870285 VonManstein
VonManstein's picture

dunnoo american english works fine though



Tue, 10/09/2012 - 09:55 | 2870498 CPL
CPL's picture

Watch out.


The USD guts are about to get yanked out through it's ass.  Between the IMF pointing out there is no money and no market except the banks and VIX and ...well all spreads.  This is a situation nobody wins.


If the currency tracking in one country gets steam rolled, we'll be seeing it infect other systems soon.  Crash bam boom baby!

Tue, 10/09/2012 - 11:38 | 2871242 fourchan
fourchan's picture

screw iran.

Tue, 10/09/2012 - 16:28 | 2872474 perishabull
perishabull's picture

????? ???????

Tue, 10/09/2012 - 22:54 | 2873385 Caveman93
Caveman93's picture

Wife says "Tala...bitchez". ;)

Tue, 10/09/2012 - 11:32 | 2871212 zerozulu
zerozulu's picture

First country moving toward The Gold Standard.

Tue, 10/09/2012 - 08:29 | 2870271 Anne Ominous
Anne Ominous's picture

Keeping it rial... but not for long.

Tue, 10/09/2012 - 08:45 | 2870297 GetZeeGold
GetZeeGold's picture



Book that kid for a weekend in the Catskills......those Jews are going to love his ass. 

Tue, 10/09/2012 - 08:30 | 2870273 Alpo for Granny
Alpo for Granny's picture

Waits for the Hacksaw Jim Duggin 2x4 to the metals prices in 3...2...

Tue, 10/09/2012 - 09:15 | 2870359 fuu
fuu's picture

There it goes.

Tue, 10/09/2012 - 09:31 | 2870418 ParkAveFlasher
ParkAveFlasher's picture

Hacksaw Jim ... so right on so many levels.

Tue, 10/09/2012 - 08:33 | 2870278 EscapeKey
EscapeKey's picture

No problem which a commodity backed currency can't solve.

Tue, 10/09/2012 - 09:02 | 2870320 Augustus
Augustus's picture

It is a commodity backed economy.

Just not enough being sold, evidently.

Tue, 10/09/2012 - 10:06 | 2870545 moonstears
moonstears's picture

True statement Augustus! Sanctions working=hyper inflation? How long before that's the spin, why claim 16 guys did it, blame the "Great Satan", amateur dictators IMO.

Tue, 10/09/2012 - 10:44 | 2870808 Cpl Hicks
Cpl Hicks's picture

It was the Gang of 4(squared).

Tue, 10/09/2012 - 10:10 | 2870567 SafelyGraze
SafelyGraze's picture

there's not enough commodity

Tue, 10/09/2012 - 08:36 | 2870282 youngman
youngman's picture

Iran would be a good market for tungsten bars I think....

Tue, 10/09/2012 - 08:36 | 2870283 FubarNation
FubarNation's picture

More important - how about the price of black gold in Rials?

Tue, 10/09/2012 - 08:39 | 2870288 zorba THE GREEK
zorba THE GREEK's picture


Coming to a location near you.

Tue, 10/09/2012 - 08:42 | 2870293 Dr. Engali
Dr. Engali's picture

They need banks like the morgue who are experts at suppressing the price of gold.

Tue, 10/09/2012 - 08:42 | 2870294 BidnessMan
BidnessMan's picture

Black Swans on the horizon....

Tue, 10/09/2012 - 08:46 | 2870301 JPM Hater001
JPM Hater001's picture

So goose for dinner eh?

Tue, 10/09/2012 - 08:43 | 2870295 MFLTucson
MFLTucson's picture

Soon to be coming to a theater near you!  But, wait, Bernanke said Gold is not money and the  mob on Wall Street have told the people to buy stocks and US bonds, not  Gold!! FU, I will stick with bullion you can have stock and bonds in an economy held up on lies and deception!

Tue, 10/09/2012 - 09:34 | 2870427 Urban Redneck
Urban Redneck's picture

... <CTRL-P> brings to mind Ben's response to Ron Paul as to the nature of gold ("tradition" vs money). I don't think Ben was necessarily lying when he said he doesn't think gold is money. Money is something that Ben can print at will, gold is not. If he lied in his response to Rep. Paul's question it would be when he stated that Treasury bills are not money, since they are the primary currency used between central banks for non-overnight transactions (f/x reserves). However, in fairness to Ben's sense of self importance the creation of Tbills is done at the will of the State's Treasury, not its Central Bank. Central Bankers are nothing more than hired help to those who direct the State. To quote J.P. Morgan, "I don't know as I want a lawyer to tell me what I cannot do. I hire him to tell how to do what I want to do." To promote the phrase to the level of TPTB, "I don't know as I want a central banker to tell me what I cannot finance. I hire him to tell how to finance what I want to do." Gold is a relic of a barbarous age when TPTB had to find some suckers to loan them gold to finance their acquisition of other (non-gold) resources . In this more "sophisticated" age TPTB simply order their Central Bankers to print the money, and the costs are seamlessly passed on to their muppets through decreased purchasing power. The new suckers are built into the system and do not have to be found or convinced to participate.

The war between credit and resources. The war between money and wealth. It's a matter of persecutive. Credit and money are the opposite faces of the heads-I-win, tales-you-lose trick of the central banks to support the State's ambitions. If Money (or credit) was wealth to TPTB then there would be fewer wars, as TPTB could simply have their Central Bankers and Treasurers print wealth or issue credit. TPTB measure wealth (and power) in terms of the means of production (raw materials, factories, infrastructure, muppets, and energy resources). Muppets, however, measure wealth (and power) in terms of money. Gold (and precious metals generally) are the overlap of the two measuring systems (lead and brass also overlap but my time is short today).

Tue, 10/09/2012 - 08:43 | 2870296 blueRidgeBoy
blueRidgeBoy's picture

let them eat (yellow) cake

Tue, 10/09/2012 - 08:45 | 2870299 JPM Hater001
JPM Hater001's picture

“Paper money eventually returns to its intrinsic value – zero.” (Voltaire, 1694-1778)"


Again, this is my surprised look


- -


Tue, 10/09/2012 - 08:50 | 2870310 Quinvarius
Quinvarius's picture

Canary in the coal mine.

Tue, 10/09/2012 - 10:16 | 2870587 Bay of Pigs
Bay of Pigs's picture

The canary's life was often "short but meaningful".

Tue, 10/09/2012 - 09:06 | 2870330 toomanyfakecons...
toomanyfakeconservatives's picture

Why bomb women and children when you can impoverish and starve them?

Tue, 10/09/2012 - 09:15 | 2870349 dwdollar
dwdollar's picture

Well how the hell can Uncle Scam claim to be rescuing the Iranians if they don't look sickly for the nightly "news" shows? Onward with the socialist revolutions!

But enough of this, let's talk feetsball!!!!!!!!!!!!!

Tue, 10/09/2012 - 09:32 | 2870422 kridkrid
kridkrid's picture

http://www.youtube.com/watch?v=VKNoJ2BzSRU&feature=youtube_gdata_player - I'm sure the camera crew could share a sandwich.

Tue, 10/09/2012 - 09:36 | 2870429 andrewp111
andrewp111's picture

It is just a matter of squeezing Iran hard enough so Iran fires the first shot of the war. It worked with Japan in WW II, didn't it?

Tue, 10/09/2012 - 09:12 | 2870347 Bagbalm
Bagbalm's picture

Push this government in a corner and it will fight. They never just pack up and go home and voluntarily relinquish power. Just a question of days now.

Tue, 10/09/2012 - 09:26 | 2870402 youngman
youngman's picture

Back in the Shah of Iran days I was in engineering school....so were the Iranians..60% of the class...they got $75,000  a year to go...they all lived in one or two houses...15-20 of them...all had new Trans Ams...very cool...and studied hard so I was in the lower 1/4 of my class...lol...hell half the teachers assistants were Iranians who spoke very little English....I know why the colleges did it...the money....but for us Americans it was wrong..they did not work with you..study with you..socialize with you ...It was not a good experience actually...

Tue, 10/09/2012 - 10:51 | 2871039 Cpl Hicks
Cpl Hicks's picture

I too was in engineering school (UW '77) in the mid-70's. And there were a few in my class. And one of them did drive a Trans-Am. But he flunked out.


Tue, 10/09/2012 - 09:38 | 2870442 urbanelf
urbanelf's picture

Goddamn, my massive long-Rial/short-chicken-taquitos investment is looking pretty dumb.

Tue, 10/09/2012 - 09:52 | 2870494 Drachma
Drachma's picture

16, 000, 000 rial is about 1300USD. Any idea on the weight of those "old gold coins"? I found no explanationin in the linked article either.

Tue, 10/09/2012 - 10:03 | 2870533 moonstears
moonstears's picture

30% Tungsten, 1ozt gold coins?

Tue, 10/09/2012 - 11:44 | 2871271 Au Shucks
Au Shucks's picture

What exchange rate are you using??  the official one?? lol

Tue, 10/09/2012 - 21:20 | 2873183 Tompooz
Tompooz's picture

Probably 1 toman gold coins.

Tue, 10/09/2012 - 09:58 | 2870508 Againstthelie
Againstthelie's picture

Hm, the Zionists tried to ruin the Iranian economy, they infected their computer systems, they tried a color-coup two years ago, they have robbed Iranian abroad money, they commit terror attacks against Iranian scientists, the North Atlantic Terror Organization supports terrorists to encircle Iran, they sabotage the talks with the IAEO but currency manipulation was out of the question? Come on ZH, usually you do a better job!

Tue, 10/09/2012 - 12:13 | 2871396 jtg
jtg's picture

After the 1979 revolution the Iranians essentially declared war on the US and called for the extermination of Israel (i.e., mass murder of Jews), and you don't think the US and Israel will or should respond? If I keep saying that I will kill you wouldn't you respond?

Tue, 10/09/2012 - 10:17 | 2870590 Whiner
Whiner's picture

All your oil deposits are belong to us! Give us your damn oil or Mittens and The Squid will drop the Big One on you rag heads.

Tue, 10/09/2012 - 11:05 | 2870771 steve from virginia
steve from virginia's picture


Both the Iranian petroleum trade and the resulting currency exchange have retreated to the darkest of shadows. This is the consequence of sanctions by the West: a form of finance warfare waged against the Iranians.


Maybe the Iranians should let the IMF appoint a 'technocrat'.


Meanwhile, currency arbitrage is running away: dollars, rials and gold are all trading in like/related markets at the same time. People sell their life savings to gain dollars (or gold) which are entering Iran by way of the underground petroleum markets. There is dollar preference (as in Europe, BTW). Unlike the rial, dollars are exchangeable for everything: crack cocaine, explosives, black-market gasoline, porn, 'dates' with hookers, you name it. Part of the Iranian government's problem is its ongoing gasoline subsidies: they Iranians drive b/c there is nothing else for them to do (besides fuck) and the subsidy + driving puts a lot of rials onto the streets.


Iranians need to end the gas subsidy and require payments in dollars at gas stations. It would be the 'drive to drive' versus the 'drive to gain dollars at the cost of one's life savings'. One drive would cancel out the other drive.


It is the war of the West's cars versus the Iranians' cars. Some region's cars have to go, it's physics. Westerners want the Iranians to take the knife in the neck. The only way out of this mess is for some region to get rid of its cars.


The endgame if nothing is done is the Iranians are unable to buy fuel anyway and the economy is dollarized by way of the black market. This is likely the goal the US establishment had in mind from the beginning. Add billions of counterfeit rials and the Iranian economy becomes a dependent/colony of the West.


Of course, the Iranians can always close the Straits of Hormuz and raise 'holy hell'. Can't really blame them. It's not their fault they have a lot what remains of the dumb world's crude oil. Then you have the people fighting and killing each other for the cars. You cannot make this shit up, it's almost too stupid to believe.


Our post-peak oil world is not a pleasant place, get used to it.



Tue, 10/09/2012 - 13:26 | 2871655 AGuy
AGuy's picture

"Maybe the Iranians should let the IMF appoint a 'technocrat'."

Can we send Larry Summers?

Tue, 10/09/2012 - 11:06 | 2871112 giggler123
giggler123's picture

So that's about 50 million Rial to 31.1g of gold, so that old gold coin you are talking about is like 10g?  What will that get you?  A bag of crisps?

Tue, 10/09/2012 - 11:28 | 2871199 Olympia
Olympia's picture

Global Debt Crisis

The greatest private fraud of human history.
Who are the great fraudsters who are becoming the murderers of the human kind? How does the economy "illness" threaten Democracy and the freedom of people?

By knowing what happened in indebted Greece, where loan sharks created “bubbles” and the current inhuman debt, one can understand the inhuman plan in total ...understand where this plan started just to bring all states at the same end ...understand how this type of plans are established...

Do NOT follow this link or you will be banned from the site!