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Israeli Minister: Iran's Economy Near Collapse  
User currently offlinemaxthrusta330 From , joined Dec 1969, posts, RR:
Posted (1 year 11 months 1 day 23 hours ago) and read 2089 times:

For those who follow Middle Eastern affairs, you are probably aware of the news concerning the alarming depreciation of Iran's currency, the Iranian Rial:

http://www.bloomberg.com/news/2012-0...rket-stabilization-initiative.html

What you may not be aware of is that the Israeli Economy minister is claiming that the Iranian economy is close to collapse:

http://www.guardian.co.uk/world/2012...my-verge-collapse-sanctions-israel

http://www.jpost.com/IranianThreat/News/Article.aspx?id=286152

I personally believe that the Israeli economy minister is full rubbish, as it takes a lot more than a currency devaluation to bring down an economy, especially a battle hardened economy like Iran's that has survived and thrived in spite of over 30 years of sanctions and also a grueling 8 year war with Iraq which claimed approximately 1 million lives.

In my opinion if the sanctions were swapped it would be the Israeli economy that would undoubtedly collapse.

It is strange however in light of the recent drop in value of the Iranian Rial, that the Central Bank in Iran has not increased interest rates to encourage people to keep their Rials in the bank, instead of withdrawing them and buying US Dollars and other foreign currencies. With such a fast rise in the value of the US Dollar in Iran (over 32500 Rials to the Dollar at the time of writing this), it is very tempting for ordinary people to forgo their standard 7% annual rate of interest offered by their bank, in pursuit of fast and easy gains to be made in buying foreign currency. This morning (October 1st 2012) in the space of less than one hour, the US dollar gained close to 10% in Tehran's currency market. When Iranians can earn 10% gains in less that 1 hour if they purchase Dollars, why on earth would they choose to wait 1 YEAR to earn ONLY 7% from an Iranian bank?

The side-effect of this for the Iranian economy is that people can begin to loose confidence in the country's money and feel compelled to exchange it. This in turn creates a vicious-circle and only makes the problem worse and worse.

My question is: Why has the Central Bank in Iran not stepped in and significantly increasing the interest rates to defend the value of the Rial?

17 replies: All unread, jump to last
 
User currently offlineKlaus From Germany, joined Jul 2001, 21442 posts, RR: 54
Reply 1, posted (1 year 11 months 1 day 22 hours ago) and read 2066 times:

I'm not familiar with the details, but the availability of foreign currency is probably constrained, so these effects are probably not as severe as they could be theoretically.

User currently offlineQFA380 From Australia, joined Jul 2005, 2062 posts, RR: 1
Reply 2, posted (1 year 11 months 1 day 22 hours ago) and read 2060 times:

It is of course in Israel's best interest to make Iran appear on the verge of collapse with the reactors falling into who knows hands, clear that this guy is talking out his arse. Saying that the Iranian economy has 'thrived' over the past 30 years is a bit of a stretch though, go have a wander through your preferred measures of GDP. The much more developed US economy has multiplied by about as much since 1980, starting from a much higher base.

Quoting maxthrusta330 (Thread starter):
In my opinion if the sanctions were swapped it would be the Israeli economy that would undoubtedly collapse.

That's not much of a revelation...Israel is a tiny poorly endowed country with no water, Iran is a massive country with plenty of natural resources and enough people to at least maintain some standard of living.
It is also indisputable however that Israel contributes more to the global populace than Iran so don't pretend you and I wouldn't be affected by sanctions against Israel too...not sure how close you live to Marrickville but their boycott was pretty unsuccessful and would have cost rate payers a substantial sum.


User currently offlineMadameConcorde From San Marino, joined Feb 2007, 10893 posts, RR: 37
Reply 3, posted (1 year 11 months 1 day 22 hours ago) and read 2039 times:

I am 100% sure that Israel would love to have the amount of natural resource that Iran has got. The Israel talking is make-believe, false information and propaganda on their own people and those in the world who will believe them.

Iran can certainly become self-sufficient without much exterior help much more than Israel will ever be. They should really look to their own problems with Palestine and Egypt rather than constantly rattling their sabers on Iran.

I doubt the U.S. (Obama-Clinton) administration will follow and be willing participate in an attack and it all seems that Obama will be re-elected for another term and I doubt he will change his mind should he win another 4 years in the White House. Romney would be a different story, he would go to war against Iran taking Israel side but he isn't in the White House yet and most chances are he will have no luck with that.



There was a better way to fly it was called Concorde
User currently offlineRussianJet From Belgium, joined Jul 2007, 7701 posts, RR: 21
Reply 4, posted (1 year 11 months 1 day 19 hours ago) and read 1988 times:
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Quoting maxthrusta330 (Thread starter):
What you may not be aware of is that the Israeli Economy minister is claiming that the Iranian economy is close to collapse:

You're right, I'd never have known. I would have expected to hear him bigging it up all over the place, praising its management all round and telling all and sundry that they should be more like Iran in all matters, not just economics.



✈ Every strike of the hammer is a blow against the enemy. ✈
User currently offlinePHX787 From Japan, joined Mar 2012, 7434 posts, RR: 17
Reply 5, posted (1 year 11 months 1 day 14 hours ago) and read 1889 times:

Quoting maxthrusta330 (Thread starter):
What you may not be aware of is that the Israeli Economy minister is claiming that the Iranian economy is close to collapse:

Well you answered my first question right here:

Quoting maxthrusta330 (Thread starter):
I personally believe that the Israeli economy minister is full rubbish,

Exactly. I don't like Iran as much as the next guy (I love their people though- so warm and nice, and grateful to be living in America)

But when Israel says one thing about Iran I immediately discredit it because I know there's a negative bias being thrown towards it. Both countries have been known to distort their own reporting. Unless someone with the world bank says that Iran is gonna go under, and there's other tangible credible proof, I can probably agree with them. For now this should just be taken as another chapter in the verbal attacks between the two nations.

All of this goes good with popcorn      



次は、渋谷、渋谷。出口は、右側です。電車とホームの間は広く開いておりますので、足元に注意下さい。
User currently offlineluv2fly From United States of America, joined May 2003, 12099 posts, RR: 49
Reply 6, posted (1 year 11 months 1 day 12 hours ago) and read 1848 times:
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Well when they were in town for the opening of the UN instead of seeing the sites they hit Costco, Walgreens and the like shopping for basic items. So not usre it is all Rosey in Iran. Natural resources mean squat when you have no buyers.

http://www.haaretz.com/news/middle-e...hopping-spree-in-new-york-1.467123



You can cut the irony with a knife
User currently offlinethegreatRDU From United States of America, joined Mar 2006, 2310 posts, RR: 4
Reply 7, posted (1 year 11 months 1 day 12 hours ago) and read 1831 times:

This is a bunch of crap spoon fed to the American people.


Our Returning Champion
User currently offlinecasinterest From United States of America, joined Feb 2005, 4588 posts, RR: 2
Reply 8, posted (1 year 11 months 1 day 11 hours ago) and read 1822 times:

Quoting luv2fly (Reply 6):
http://www.haaretz.com/news/middle-e...hopping-spree-in-new-york-1.467123
http://www.reuters.com/article/2012/...urrency-drop-idUSBRE89014620121001

Iran may have it's natural resources, but the import/export world is being drastically affected. With the purchasing power going down, many of Iran's strategic trading partners will have trouble getting the investment return that they demand.

Quoting maxthrusta330 (Thread starter):
What you may not be aware of is that the Israeli Economy minister is claiming that the Iranian economy is close to collapse:

Near a collapse is a relative term . But, how far are they from the breaking point with skyrocketing inflation and unemployment?



Older than I just was ,and younger than I will soo be.
User currently offlineAirframeAS From United States of America, joined Feb 2004, 14150 posts, RR: 24
Reply 9, posted (1 year 11 months 1 day 11 hours ago) and read 1816 times:

Quoting MadameConcorde (Reply 3):
(Obama-Clinton)

Uh, Clinton isn't the Vice President. Biden is.

Hilary, however, is the Secretary of State.



A Safe Flight Begins With Quality Maintenance On The Ground.
User currently offlineAesma From France, joined Nov 2009, 6607 posts, RR: 9
Reply 10, posted (1 year 11 months 19 hours ago) and read 1712 times:

Quoting QFA380 (Reply 2):
It is of course in Israel's best interest to make Iran appear on the verge of collapse with the reactors falling into who knows hands

That would be a bit rich don't you think ? Force us to impose sanctions to stop the nuclear program, and when sanctions take their toll, invoke the result to launch an attack ?



New Technology is the name we give to stuff that doesn't work yet. Douglas Adams
User currently onlineNorthstarBoy From United States of America, joined Jun 2005, 1826 posts, RR: 0
Reply 11, posted (1 year 11 months 19 hours ago) and read 1703 times:
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I'm confused. How can Iranian banks offer 7 percent interest when the Koran specifically prohibits making money on money. Isn't Iran supposed to be the Islamic state? Or does Khamenei bend the rules to his own liking?


Why are people so against low yields?! If lower yields means more people can travel abroad, i'm all for it
User currently offlineImperialEagle From United States of America, joined Jan 2006, 2530 posts, RR: 22
Reply 12, posted (1 year 10 months 4 weeks 1 day 11 hours ago) and read 1587 times:
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Seems as though the rial has hit a new low----enough to send the people rioting into the streets.

Maybe the Israeli Minister of the Economy is not all that far off the mark after all!  
Today's New York Times has an interesting article on the front page.



"If everything seems under control, you're just not going fast enough!"
User currently offlineconnies4ever From Canada, joined Feb 2006, 4066 posts, RR: 13
Reply 13, posted (1 year 10 months 4 weeks 1 day 10 hours ago) and read 1567 times:

Stuart Eisenstadt (fmr DepSecTreasury under Clinton, and a member of a couple of think tanks) was recently interviewed on BBC World. He stated that the rial has indeed fallen 80% of the past year and somewhat, and continues to fall (leading to rioting in Teheran today). Inflation is accelerating and is way past 20%, unemployment nearly that.

Oil production 18 months ago was 2.5m bbl/day, now about 1m. Can't get parts to keep the rigs running since they are hard up for hard currency.

If you look at the Turkey-Iran border crossing, normally chock full of vehicles taking various kinds of product into Iran, now is basically empty. Reason: no money, no supplies.

'Ordinary' people are finding it harder and harder to get the usual daily requirements for various consumer items, toiletries, the like.

Looks to me like sanctions are starting to really dig deep. If you strangle an economy, eventually there will be an "uncle" point. When the elections are held next year, if Ali Larijani or someone like-minded is elected, I think the situation may change for the better. Unless BN blows it up for his own short-term gain.



Nostalgia isn't what it used to be.
User currently offlineDeltaMD90 From United States of America, joined Apr 2008, 7884 posts, RR: 52
Reply 14, posted (1 year 10 months 4 weeks 1 day 9 hours ago) and read 1554 times:

Quoting connies4ever (Reply 13):
When the elections are held next year, if Ali Larijani or someone like-minded is elected, I think the situation may change for the better.

We can only hope. I can see it easily turning into "the Zionists are denying you basic supplies, hate the West!" I feel for the average Iranian, I've talked with several, they are really good people, the complete opposite of their government



Ironically I have never flown a Delta MD-90 :)
User currently offlineconnies4ever From Canada, joined Feb 2006, 4066 posts, RR: 13
Reply 15, posted (1 year 10 months 4 weeks 1 day 9 hours ago) and read 1544 times:

Quoting DeltaMD90 (Reply 14):
We can only hope. I can see it easily turning into "the Zionists are denying you basic supplies, hate the West!" I feel for the average Iranian, I've talked with several, they are really good people, the complete opposite of their government

Well, I've actually been in Iran. Yes, marvellous people, generally well-educated in urban areas.

As for terrible governments, try Belarus or any of the several "stans". Iran comes out looking fairly good.



Nostalgia isn't what it used to be.
User currently offlineMadameConcorde From San Marino, joined Feb 2007, 10893 posts, RR: 37
Reply 16, posted (1 year 10 months 3 weeks 6 days 22 hours ago) and read 1436 times:

Iran Offers Plan, Dismissed by U.S., on Nuclear Crisis

.... The Iranian plan is based on a proposal made to European officials in July. It essentially calls for a step-by-step dismantling of the sanctions while the Iranians end work at one of two sites where they are enriching what is known as “20 percent uranium.” Only when the Iranians reach step No. 9 — after all the sanctions are gone and badly depressed oil revenues have begun to flow again — would there be a “suspension” of the medium-enriched uranium production at the deep underground site called Fordow.

read more:
http://www.nytimes.com/2012/10/05/wo...isis.html?partner=rss&emc=rss&_r=0

 



There was a better way to fly it was called Concorde
User currently offlineDeltaMD90 From United States of America, joined Apr 2008, 7884 posts, RR: 52
Reply 17, posted (1 year 10 months 3 weeks 6 days 15 hours ago) and read 1392 times:

Quoting MadameConcorde (Reply 16):
Iran Offers Plan, Dismissed by U.S., on Nuclear Crisis

Well, if you look at it from the view of the US (even if you don't agree with it) it's very easy to see why they'd say NO to that plan. Agree or disagree, the sanctions were put there to stop Iran from getting a nuclear weapon and they'd still be producing some uranium. Obviously, the deal would be rejected



Ironically I have never flown a Delta MD-90 :)
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