I think we all know that famous image showing how the USD has lost value over the last century, but honestly, that’s a walk in the park compared to what’s going on here.
Picture a currency that was worth 1.25% of the USD in 1980 now becoming just 0.000085% of it. They went from a peg of 80 rials to 1 dollar down to a staggering 1,150,000 rials for a single dollar.
And let’s be real, getting their butts kicked by Israel and facing total embarrassment didn’t do them any favors. With inflation spiking over 35% a year and their oil and gas output and prices tanking, it’s like the rial is in a total nosedive. They can’t even handle numbers like normal folks anymore.
With banks going down left and right, news like this pops up:
Yep, they’re dealing with quadrillions over there!
If you need more proof of how dire things are:
This thing is worth a whopping 0.1 cents!
Each piece of this fancy toilet paper? Yeah, that’s valued at 0.3 cents!
And don’t forget, a Bitcoin is sitting around 110 billion rials, while the entire crypto market cap is a mind-blowing 4 quintillion rials! Seriously, when was the last time you even thought about quintillions?
I just attempted to pronounce the word Quintillions for the very first time after reading this thread. Had to check how many zeros it contains, and I saw 10¹⁸(US standard) and 10³⁰(British standard). The only time I have seen such a number is in a physics question I guess.
This massive decline and increase in debt to such an amount makes me still doubt the use of government in this current age. Fine, I agree that they've been at war, but who are those that are on the receiving end of all these?, the citizens of course. Don't this same government spend heavily on nuclear weapon programs while their economy shambles?. No life deserve to suffer for the ignorance of any supposed government.
And just so we know, other countries are heading on same direction in terms of fiat decline, and the US is not left out. Their debt keeps increasing here and there, and the printing of fiat has become a norm. Maybe declaring a third world war would be their only excuse to cover up the shames for entire mess that they've caused during their time in office. How pathetic...
Yes, actually in some self-moderated threads.
Lol.
It reminds me quite a bit of Zimbabwe.
The worst thing is that we often criticize the dollar or the euro for devaluation, but most currencies in the world are worse, or even much worse, as in this case. There are a few exceptions, such as the Swiss franc, but not many.
That's why I believe the US stablecoin project will be successful, because there will be high demand for dollars from countries with currencies that have much worse inflation.
People may argue that sanctions are the reason the currency and inflation are so high in the country, but I disagree. A country with so many high denominations of currency notes, when facing such a dead currency, screams corruption. What goes through the heads of the leaders when they decide to make another currency higher than the previous one? Like in 2010 when they created the 100,000 bank note. What were they trying to achieve? The currency was already dying when a 50,000 note was the highest in the country, but somehow, they still went ahead to create something higher than that instead of looking for a way to scrap ridiculously high currencies and make the currency scarce.
This is common knowledge. Anybody who doesn't know this is just lying to himself to suit his narrative. Even the Chinese Yuan hasn't performed better than the dollar, and the dollar still has more value than it. Currencies like the pound, dollar or Euro are held to a different standard, and that is why they can be criticised for little devaluations. It's people who have a narrative to push that often make it look like it's the apocalypse for the dollar when there is turbulence, the same way critics act when there is a dip with bitcoin. At the end of the day, everybody knows the dollar is the top 5 currency in the world and it's not 5th, btw.
Soon coming to a country near you. This is the inevitable outcome for every FIAT out there. You are rightfully making fun of the Iranian Riyal but there isnt a single FIAT currency in history that lasted forever. All of them die eventually. The USD too. Look at what happened to USD in a couple years. Godl doubled against usd in 2 years or smth. Look what happened to the purchasing powa of the USD since the 1900s and the US isnt under any sanctions like Iran. Lets invest in real money. Hodl godl and bitcoin. The others are (including USD) all crap.
In conclusion, the rial is merely an administrative symbol that allows Iran to be considered a country with an independent monetary system, although it is slowly losing its function as a currency. Anyway, isn't Iran a member of BRICS? Doesn't that organization provide them with any benefits in this situation?
A few weeks ago, I followed the story of a fellow Iranian traveling to Middle Eastern countries. Long story short, he paid around 1.2 million rials for a night in a simple Iranian hostel. Damn, I thought, why is it so expensive? I hadn't realized the rial's exchange rate was so low.
After reading the OP thread, I was reminded of German history, where during the Weimar era, the price of a loaf of bread increased 1.25 billionfold. A figure that's almost incomprehensible but a clear demonstration of what happens when money is printed continuously.
But ultimately what happening to the Iranian rial today will be felt by our country FIAT currency. Just wait! because fiat currency is slowly losing its meaning, and history has proven no fiat currency has lasted long. So let's turn to gold and bitcoin, and this is already evident today, as every country and central bank has increased its gold reserves.
Well Zimbabweans will be used to those numbers the Zimbabwean dollars has gigantic amounts in just one note and that note can hardly be used get anything of value.
Iran cutting zeros is what Ghana did after their currency was going same way as that of Iran and Zimbabwe but what this cause is create a delusion and even the citizens of these countries might start thinking that their economy has now become stable and their currency has automatically regained value.
Iran has only been a member of BRICS for a year, and there are not many benefits that they can get from the organization, other than that is their alliance, but their uncontrolled inflation is a serious problem which makes the country's economy even worse, not to mention the problem of corruption and economic mismanagement, it makes the situation even worse. it can be said that Iran's current situation is almost similar to Venezuela, but only that Iran's situation is still a little more stable because they still have geopolitical power and resources that can be exported to their partner countries, but it's just that it's still not enough to be able to overcome their current economic situation.
The sanctions added in the extreme devaluation but it's not the major cause of it. Often times what has led to these third world countries losing value in their currency is due to bad economic policies and corruption going hand in hand. Printing a higher denomination notes for your currency can't be a god economic decision to tackle it's devaluing apprehension but corruption leadership embark with this decision to easily steal from the country. Aside scrapping the high notes denominations the government has to balance their budget to cause such scarcity of the currency to improve it's value.
But, but but...the EU and US are doomed, next year we will hunt rats for food.
Haven't you learned anythign from those self-moderated topics?
Let me tell you what it goes through their heads, if something doesn't work:
- blame anythign bad on Israel
- blame everything ele on USA
- blame anything bad on women not covering their hair, and beat them to death to see if it works
If that doesn't help beat and kill everyone who says there is a problem!
Iran has turned into the biggest shithole in the world, but just as their leaders, some of the population is so brainwashed that they actually believe they are doing fine and that the rest of the world is in trouble, you can see this even on this forum, where there is a mentally retared guy who thinks Iran is a superpower!
BRICS, I lolled!
GDP per capita for BRICS $7800
GDP per capita for the US poorest state, Mississippi, $53000.
The question about numbers has just one answer: Never!
About the paper, I can understand the feeling about using the cheap version, but I will remain loyal to the standard one...
Joking aside, there was a speech by Saylor where he said: "the first country that print money for buying btc has won the race"
At certain point I would not be surprised anymore for these heavy debasement. The same anyway is happening even in EU.
When I was young the bigget ice cream was around 20 euro cent (0.20 euro)
Now with this amount, after 45/50 years, you can probably buy the cherry that was on the top of this ice cream
For a the people that say sanctions don't work it's a good example of how messy the economy of a country can become. If China wasn't propping them up it would probably look a lot worse. I feel bad for the average Iranian who likely doesn't want their shitty leadership but are powerless to overthrow it. It's a real shame that the UK/USA got things wrong with overthrowing their previous monarchy, who weren't perfect but ruled a much more normal looking country those decades ago.
Iran's redenomination was undoubtedly intended to address the severe inflation it was experiencing. This inflation was influenced by real economic conditions (macro and micro) as well as external pressure from global elites through international geopolitical and monetary instruments. Redenomination was also the most realistic step to win public sentiment because it had a temporary psychological effect.
Iran's inflation was largely due to domestic economic conditions. As a country rich in oil resources, Iran suffered from the oil curse syndrome. With a high dependence on oil and gas revenues, massive energy and food subsidies, limited production and capital, a dual exchange rate, and a disconnection from the global financial system, printing money became a problem because it was not accompanied by increased production. Therefore, Iran's inflation was systemic and structural. External pressure also exacerbated inflation. Since the 1979 revolution, the West has implemented economic containment using sanctions as an economic weapon. Iran's biggest sin was its opposition to the petrodollar since the early 2000s, which the West used as an example of how to deal with dissent. The West also drained Iran's foreign exchange reserves to prevent it from stabilizing its currency by manipulating prices to harm oil-exporting countries like Iran and Russia. Furthermore, interference occurred to trigger a self-fulfilling inflationary spiral through various forms of economic sabotage.
What is interesting is the background to Iran's rebellion?
After the revolution, Iran engaged in economic resistance and decoupled from the Western system, realizing that Iran was only wealthy on paper, but structurally, its wealth/poverty was determined by the US and fluctuations in oil prices. As a peripheral country, it sought to become an alternative core nation through alliances with China and Russia, making Iran a systemic actor initiating an alternative economy. What further fueled Western antipathy was the perceived irrationality of Iran's economy, as its goal was not simply growth but ideological sovereignty moral and spiritual sovereignty against the hegemony of global materialism.
Iran's resistance was logical, because if it surrendered, Iran would lose its sovereignty, resources, and regional influence. Religion is the ideological glue that legitimizes Iranian nationalism, but Iran did not surrender to the US not only because of religious ideology, but because religion had become the framework for national sovereignty. Iran's national interests were encapsulated by revolutionary Islamic ideology. Religion provided moral legitimacy, and nationalism provided strategic direction. Resistance against the West is a form of jihad (a combination of faith and survival). Thus, for the West, Iran is not simply an Islamic state, but a political civilization that rejects the Western liberal world order.
The thing is, the leaders are not brainwashed; they know what they're doing, but they need someone to blame for their greed and incompetence. So they make the people of the country and the world blame something else instead of them. I see this a lot from a lot of developing countries as well. The leaders will never come up openly and admit that they're stealing the country's resources or just incompetent; it's always easier to blame the US and the rest of the West. There is no way a country that is among the top 10 countries in oil production will have that level of poverty and inflation, and the leaders won't be at fault for it.
When you talk about these things, people will say you're buying into Western propaganda, and I find it very funny because what part of the fence doesn't have propaganda?
Bruh!
In Iran in the morning you get the icecream for x rials, in the afternoon you get the cone and in the evening you get nothing for those rials!
You can't even compare an inflation of 2-5% a year with 120% for consecutive years and god knows when it's stopping!
Just as an example, your 20 cents were worth around 20 rials back in 1990, now those 20 rials are worth 0.0001 euros, yeah, that's 100th of a cent!
Is your ice cream now 20,000 times more expensive?
These stupid Japanese, if only they had listened to the mullahs and their logic!
Imagine about 6 decades ago 1$ was just 89 cent (#) Nigeria naira and currently 1$ is equivalent to #1,464.64. what a mind blowing where politics and mixed economy interests and the ideal of foreign reserve was adopted and manipulated to crumbled the value of the Nigeria economy while the USD bond are being appreciated and elevated due to lack of inflation control of the authorities.
Historically the USD was of no good value to write about against most traditional currencies that has come below the USD this time. I even wonder what the US economy would be in those days.
Once upon a time when Nigerian Naira had more value than American dollar, to emphasis on it; in 1983, one (1) dollar was 0.894 Naira ($1= N0.894) not even up to a Naira but 89Kobo.
They're as similar as night and day.
The modern version of colonialism: simply surrender and become a developed nation. I almost forget that Japan paid for its prosperity by losing its sovereignty. Iran sees itself as a nation with an ideological and spiritual mission, even if the US promises prosperity like Japan, Iran will not see it as an ideal example. Belief is the one thing worth dying for.
Japan can surrender without losing anything. Sometimes surrender brings prosperity, but only if you have nothing. Iran has oil and gas, the backbone of the global economy. If Iran surrender, it loses everything (a strategic awareness to maintain control over its own resources). Iran is not as fortunate as Japan precisely because it is too rich in energy (the oil curse).
There is no guarantee that submitting to the US will mean prosperity; if it were that easy, the Philippines would be prosperous today.
Well, how would you feel if tommorow in the news there was something like, your national currency has lost 40,000 points to the USD, sliding from 1.15 million to 1.19 million?But finally, the cut is here, not that it can stop 66% in rising food prices and a budget deficit that goes beyond any imagination!
Oh, did I mention that the largest private bank turned out to be a Ponzi scheme?
Oh, what has Japan lost again?
I mean, seriously, do you think any Japanese would trade their lifestyle for ...what?
You have no clue what sovereignty is, but remember one thing, it doesn't stop hunger!
The Naira started from a peg to the British Pound!
It's not like the currency was strong or anything; you started your own currency, and you set an arbitrary value!
Moldova could tommorow claim they have a new currency and one Moldavian whatever will be worth 1 trillion dollars, it means nothing!
They still have a long way to go before they reach the depths of Zimbabwe's hundred trillion dollar note that they reached a while ago, but that is nothing to aspire towards! Iran's economy is a shambles but it has been under intense sanctions for a long time, it's kinda impressive that they are able to sustain any economy at all - it mainly driven by local/internal trade and oil. Countries like China are actually cutting deals with Iran to buy their oil, because it is super cheap since they have few other customers. The repricing of currency that you've noted seems set to reoccur because there is nothing on the horizon that might pull them out of this situation, unless they start to normalize relations with the West - but the precursor to that is their hatred of Israel and desire to build nuclear weapons, which is a crazy thought with how they've claimed it is their mission to wipe out Israel.