Posted on 09/11/2007 7:44:19 PM PDT by nuconvert
Iran considers knocking three zeros off currency
Sep 11, 2007
TEHRAN (AFP) - Iran is examining a proposal to knock three zeros off its national currency to increase economic confidence and reduce the number of banknotes, the central bank governor said on Tuesday.
However new central bank chief Tahmasb Mazaheri said the suggested revaluation would need to be carefully studied before it could be implemented.
"This is at the suggestion phase," Mazaheri said, according to the IRNA news agency.
"In carrying out the preliminary studies we have to accurately evaluate the uses of this work and necessary measures taken for compensating any losses," he added.
Iran's economy has been hit by considerable inflation over the past 20 years, meaning that 10,000 rials (the main currency unit) is now worth less than one dollar.
The exchange rate of the rial to the dollar has soared from 70 rials to the dollar at the time of the Islamic revolution in 1979 to more than 9,300 rials today.
Paying for more expensive goods and services in Iran can thus involve handing over unwieldy bundles of cash. Every Iranian citizen holds at least 114 banknotes at one time, compared with 10 to 12 for a European, figures show.
Iran's neighbour Turkey, which has recovered from a major economic crisis in recent years, in 2005 lopped six zeros off its national currency to create New Turkish Lira and facilitate cash transactions.
The proposal came from lawmaker and member of parliament's economy commission, Gholam Reza Mesbahi Moghaddam, who said "practical and psychological" problems had been created by the fall in value of the Iranian currency.
IRNA said that President Mahmoud Ahmadinejad had told the central bank last week to "work thoroughly" on the issue.
"The deletion of three zeros from the national money is a method which could be useful, but first the ground should be prepared and the people need to be told why this is being done," said Mazaheri.
Ahmadinejad has been criticised by economists for stoking Iran's double figure inflation himself by ploughing money from high oil revenues into infrastructure projects and causing a a spike in money supply growth.
Three orders of magnitude on inflation is okay, but interest is Usury.
He sounds like Imelda Marcos! LOL
“...into infrastructure projects...”
Is that what IED’s are being called these days? I guess technically the nuke plant could be called “infrastructure”, but we all know it isn’t.
Perhaps they should consider knocking off Amadinajhad instead.
They’ve been putting pictures of Hillary, Obama, and Edwards on their currency??
He is a zero. Should be applicable.
$ pong
My hero, Zero, such a funny little hero,
But till you came along,
We counted on our fingers and toes.
Now you’re here to stay
And nobody really knows
How wonderful you are.
Why we could never reach a star,
Without you, Zero, my hero,
How wonderful you are.
What’s so wonderful about a zero?
It’s nothing, isn’t it?
Sure, it represents nothing alone.
But place a zero after 1
And you’ve got yourself a 10.
See how important that is?
When you run out of digits,
You can start all over again.
See how convenient that is?
That’s why with only ten digits including zero,
You can count as high as you could ever go...
Forever, towards infinity,
No one ever gets there, but you could try.
With 10 billion zeros,
From the cavemen till the heroes,
Who invented you,
They counted on their fingers and toes
And maybe some sticks and stones, or rocks and bones
And their neighbors’ toes.
You’re here,
And nobody really knows
How wonderful you are.
Why we could never reach the star,
Without you, Zero, my hero,
Zero, how wonderful you are.
Place one zero after any number
And you’ve multiplied that number by 10.
See how easy that is.
Place two zeros after any number
And you’ve multiplied that number by 100.
See how simple that is.
Place three zeros after any number,
And you’ve multiplied that number by 1,000.
Et cetera, et cetera, ad infinitum, ad astra, forever and ever,
With zero, my hero, how wonderful you are.
Its actually a reasonable thing to do, after some decades of inflation such as they’ve had. It just makes no sense for a loaf of bread to cost 100,000 of anything, be they rials or duckets.
But don’t expect a re-valuation of the Rial to inspire confidence. It won’t. But it is survivable.
Silly Iranians.
Yes, Iran needs to knock off three zeros, but their names are Khamenei, Ahmadinejad and Rafsanjani.
Find solutions to the big problems and the little problems, like chronic inflation, will take care of themselves.
That’s a coincidence...
I’ll bet there are folks in the Pentagon planning to “knock off” a few zeros themselves....
Dag nabbit, I’ll say it again, introduce “hedonic adjustments”, “geometric weighting”, “core inflation, which excludes volatile food and energy prices”, and “substitution” into the equations, and that so-called inflation will simmer right down to 2.3%, “in the comfort zone”. That’s how we do it here to keep people in the dark about it.
With all their nuclear whiz kids, someone should know how to use scientific notation.
Just wow...
Sure... knock 3 zeros off the currency and that will fix everything...
What a moron...
Seriously... at least the chi-coms and their fixing currency to the dollar has some base in factual economics.
I can’t imagine that anyone could take this ‘proposal’ seriously as anything other than a temporary psychological trick on the local population, and will do worse than nothing to their actual “problem” here.
The Iranian people already know their government is incompetent.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.