03/05/2012
Inflation is the most dangerous enemy of well-being and disease can strike national economies.
In addition to that pension exacerbate the suffering of the broad
sectors of the population, and changes the shape of class structure and
social effects of the disposal and recovery will not be easy, especially
if the symptoms became more serious inflation.
Economists is that inflation is dangerous if it exceeds the favorites, or if it becomes ten percent or above.
History records the contemporary economic models for countries
inflation rates exceeded these levels reached dangerous limits to become
the local currency carrying bags for the payment of prices is simple.
And can give examples of some Latin American countries like Argentina,
as well as the case of Germany in the war, Serbia, Turkey and other
countries.
If the welfare of living is the first victim of inflation, the middle
classes, the victim and crush the second Gmehrtha join the majority
class of poor and downtrodden.
Can not be dealt with merely as a result of this change the
distribution of the class, they have their social and economic
development.
Middle class element of stability and social safety, one of the
important factors of balance in society; It is also in third world
countries are useful for the development process.
As rich in these countries often maintain Bersdthm abroad, while the
poor Their role is limited in the investment process by virtue of the
living situation that surrounds them. Have formed the middle class in recent decades, the majority of Iraqi society. Situation but did not break down since the start of the wars of the former regime.
If we treat the simplified concept of inflation, which he says is "a
lot of money for a few goods". Iraq in his last years, offers a model
for this image.
Went down the purchasing power of the Iraqi dinar rates significantly,
and became incomes are not enough almost to fill their needs, and
declining Iraqi dinar exchange rate of about three thousand times, if we
take the exchange rates, which is equal to the dollar nearly a thousand
and two hundred dinars.
Thus, any Iraqi authority are to come before the challenge of
controlling inflation is rampant, it was reported some account of the
Iraqi dinar.
There is a solution, which resorted to some countries, is that the
deleted zeros from its currency degraded and replaced by a thousand
percent, or unit of currency one unit of new currency.
But thus need to make an improvement in economic data and the
availability of a minimum level of confidence the new currency and the
economy, which assigned, as well as have some cash reserves of hard
currencies, which are financed import operations.
Without the availability of these lower limits, you can not cancel the zeros on the process to achieve the effect.
The States usually resort to solve the problems of inflation where the balance between money supply and the amount of goods.
The economists usually like this policy of trying to minimize and
maximize the cash bag bag of goods, in reference to simplify the problem
and propose a solution.
Thumbnail bag Monetary easing supply by means of monetary and fiscal
policy, which he plays a central bank a crucial role in habit.
The larger bag of goods requires increased productivity significantly,
which is the approach taken by Germany to promote their economies after
the war grinding stumble.
In fact, increase productivity and improve them is a sure panacea for the eradication of inflation. Which is of course the biggest impact of fiscal and monetary remedies and more durable in efficiency.
There we find a society of rising productivity never exposed to
inflation; and we have the most prominent examples are the Japanese and
German economies, inflation rates are almost non-existent in them, and
less interest to the lowest levels of the border.
And that is only for the production of higher activity in these
communities, which give immunization against the disease economy.
However, such treatment does not happen overnight.
There must be substantial modifications to the whole economic field,
and change a lot of educational and social concepts as well, which
glorifies the values of work and creativity, perseverance and refer
people to the population of active producers.
Inflation will be a major obstacle to efforts, which will be made to
rehabilitate the Iraqi economy and alleviate the suffering of large
segments of society. However, the task is not Palmsthilh.
It is necessary to adopt a holistic approach in dealing with
intentionally providing cash reserves and then adjust monetary and
fiscal policies and improve the productivity of the individual and the
Iraqi society.
On this basis, a proposal may delete some zeros from the currency valid proposal to re-value of the Iraqi dinar.