Global RV & Reset USD Must Reset Too! 23 April Update

President Trump has stated numerous times that his reciprocal tariff negotiations with other nations will require them to stop artificially devaluing their currency to gain an advantage for their exports, while disadvantaging American exports.

He states that forcing nations to revalue their currency (RV) to true market value will be a requirement to “level the playing field” for global trade moving forward.

There is another reason why Trump wants to see other currencies valued higher – not only does it make their exports less competitive, but it allows their citizens to be able to purchase American made goods. Currently, a significant barrier to the export of American goods is the inability of the working and middle classes in other countries to have the disposable income to purchase higher priced American made goods at the current Forex (FX) exchange rates.

Countries like Iraq are already openly discussing the revaluation of their currency as part of the steps they need to take to re-integrate into the global economy and new BASEL 3 / ISO20022 global financial system.

There is a not insignificant number of people who have purchased foreign currencies as an investment, believing that once the currency revaluations are triggered, they will become multimillionaires overnight.

I believe that while many of these foreign currency holders will see profits, I believe it is unrealistic for them to believe they will become multi-millionaires unless they also currently hold millions of dollars worth (in USD) of those currencies presently.

The most common prior example cited is the currency revaluation of the Kuwaiti dinar after the Gulf War. During the war, the Kuwaiti dinar was decimated and destroyed in value.

Much like the current situation that exists with the USD/FRN today, the number of Kuwaiti dinars in circulation after the invasion of Saddam Hussein was unknown.

To counteract that, and to restore credibility to the Kuwaiti Dinar (KWD), those notes were in effect “cancelled” and new currency was printed and issued. Cancelling existing currency and/or with or without adjusting the “zeros” is known as “redenomination” (RD) of a currency. Most currencies will undergo both “RD” and “RV” in the transition from old currency to new.

An example of a redenomination would be:

25,000 old currency dinars = 25 new currency dinars.

Then, AFTER the RD, the currency would be “revalued”.

The current exchange rate for Kuwaiti Dinar to USD is approximately 3.26

So 25,000 old dinar = 25 redenominated Kuwaiti Dinar (KWD) x 3.26 = $81.53 USD

Now let’s translate that to what is the inevitable currency redenomination and revaluation (RD/RV) of the Iraqi dinar once it is fully reintegrated with the global financial systems again.

Many people who served in the Gulf theatre have held onto the old “Saddam” notes, believing that they will be revaluing. They are mistaken. Those notes are useful only as collector’s curios and will not be eligible for exchange in the upcoming RD/RV.

Much like when Kuwait cancelled all outstanding currency that had been stolen/counterfeited and reissued new dinar notes, these Iraqi dinar notes are no longer legal tender and will not be recognized or accepted in an RV. Iraq, like Kuwait did, has already reissued new currency dinar notes, which look like this:

The new issue Iraqi dinar notes (IQD) also have security features embedded in them, which the old, replaced Saddam notes did not.

At current exchange rates pre RV, a 25,000 IQD note is worth approximately $19.06 USD, less currency transaction FX fees. (1 IQD = 0.000761995 USD).

Those in the “Dinar Investment Community” believe that the IQD will RV similar to the Kuwaiti dinar, and will have an equivalent market value. I don’t want to speculate, because there are a lot of unsubstantiated rumors, theories and ideas percolating about the new IQD exchange rate in the RV “investment” community.

Let us assume that the IQD investors are correct, and that the IQD will revalue similar to the KWD, at an exchange rate of 3.26 for demonstration purposes.

These investors believe that a 25,000 IQD note that they purchased for approximately $20 will be worth $81,500 USD. I would posit that that is not realistic, nor in keeping with past foreign currency redenominations and revaluations. (RD/RV).

Huzzah to them if they are correct!

What I believe is more likely is that the Iraqi dinar will follow the same template as the post Gulf War Kuwaiti dinar RD/RV did.

An existing “new” 25,000 IQD note with the security features will be “redenominated” to 25 IQD, and new currency with the extra “000” has already been printed and is ready to be issued for exchange/redemption of old notes for new.

Therefore, a current and valid 25,000 IQD note will be worth:

25,000 > 25 IQD x 3.26 = $81.50, not $81,500 USD.

That’s still an impressive return on investment, but people who hold 1,000,000 IQD may want to put their fantasy shopping trips for Lamborghinis on hold.

$3,260,000 of fantasy RV for 1,000,000 IQD may buy you one, but the actual realistic RV of $3,260 post RD will not.

Likewise, people in the US are going to have to readjust their own concepts of “value” and pricing if the existing USD/FRN is also cancelled, withdrawn and replaced with a commodities backed note I am calling the USTDD (US Treasury Dividend Dollar) for lack of a better descriptor, and which is what the US Debt Clock has chosen to notate.

Even normally circumspect financial commentators are now opining on the inevitability of the US redenomination and revaluation of our currency as part of the larger global FOREX RD/RV reset, and how new gold-backed US bonds that can be redeemed for physical gold upon maturity will not only solve the problem of soaking up all the excess FRN floating around, but that gold backed new issue USTDD and US gold backed bonds will be what finally “destroys the Fed”, and many corrupt financial institutions.

I believe that the intention is to value the new USTDD under the terms set by the 1792 US Coinage act, which I had written about previously. Under the terms of that Act, a Gold Eagle gold coin had a face value of 10 dollars and was equivalent to “270 grains of standard gold” which is approximately 0.617 troy ounces of gold.

At a current value of $3300 USD/FRN per ounce of standard gold, that would make (1) new USTDD note worth 0.0617 troy ounces of “standard gold” or $203.61 in current USD/FRN when they are exchanged.

So a “dollar” would have real purchasing power again.

A $500,000 USD/FRN home would be revalued as $30,800 new USTDD. That is going to be a huge mental leap for many if this is how they intend to carry out the US RD/RV.

A USTDD hard currency note in your pocket, while I believe it will only be “backed” and nominally valued by gold, and will not be redeemable directly for physical gold, will return to what paper notes were intended to be – custody receipts or “SKRs” for items of value to simplify transactions and avoid people having to haul around huge quantities of physical metals to transact business.

The difference between this RD/RV and past currency replacements is that this time the commodities, including gold, that will be backing the USTDD notes (as well as other foreign currencies that will be RD/RV on the FOREX) is that the serial numbers of physical “good for delivery” bars and other commodities that will be used as surety to back the new currencies will be inventoried and uploaded onto the blockchain ledger, most likely the XRPL. This fraud prevention step will make each physical USTDD note a genuine “SKR” and ensure it retains its value and purchasing power.

This will prevent fraud and the devaluation of USTDD as has happened in the past with other paper currencies.

Paper notes were originally SKR issued by the vault holders who were trusted with the safe keeping of gold and silver on behalf of their clients, but the vault holders (bankers) eventually figured out that it was highly unlikely that all of their customers would be showing up to redeem their SKRs for their gold and silver all at once, so they began issuing more SKRs than they actually held in gold and silver in their vaults. This became the genesis of what they whitewashed and normalized as the beginning of “fractional reserve banking” but which common sense people instantly recognize as fraud.

Putting the surety backing the new USTDD onto the decentralized and tamperproof blockchain with full transparency puts an end to this fraud forever. This is also going to lead to the failure of many big name banks, who have engaged in paper fraud that will be uncovered which they will not be able to recover from once they are required to inventory, declare and upload their actual physical custody of assets onto the blockchain.

The concept of the new USTDD as I understand it is that it is also to be an asset that pays dividends and increases in value. This is to encourage savings and generational wealth building. For that reason, I believe that the physical notes will have some actual physical gold embedded in them with security features, which will discourage attempts to counterfeit the notes. As I wrote previously, this concept has already been trialed and executed by the mining states of Wyoming, Nevada and Utah working with a private vendor to manufacture and furnish the gold embedded notes.

The new USTDD will also be uploaded and recorded on the blockchain before they are issued, again to end fraud and retain public confidence in the currency. This will make digital transactions, facilitated by the XRPL payment rails seamless, trackable and instantaneous worldwide, and has the potential to upend global commerce, fully “leveling the playing field”. The XRPL also provides for almost infinite carving up of currency into “drops”. For example, 1 XRP token can be recorded as having 1,000,000 “drops”. This accounting can also be used for currency, giving a new meaning to “fractionalized banking”. Most people will opt to be credited their new currency digitally rather than physically carry around notes.

Anyways, good luck to all those foreign currency speculators and I wish you well. I sincerely hope that you are correct and I am wrong, but I think your wish list of Ferraris, mansions and private jets is overly optimistic.

YMMV.

Anyways, this is not investment advice but I hope that I answered all the questions that had been emailed to me about how a RD/RV works, to the best of my ability.

Previous posts that discussed the future “Golden Age” of America:

The Golden Age of America

Slaying Dragons and Other Quests

Limited Hangout Time