Iran Economy

Immortals · Jul 10, 2024

Eşbah said:
You guys remember the claim of Iran being the largest economy in the Middle East because of skewed IMF data?

Here's the explanation:

Source: https://www.iranintl.com/en/202201114529

You can’t use $800B figure nor can you just $250B figure. Both are extremes. That is what happens in hyperinflation.

For example: Iran produces a chair under old exchange rate the chair = $10 USD
Under hyperinflation exchange rate chair is now = $3 USD

Does that mean Iran chair is suddenly only worth $3? Of course not.

You have to recalculate the GDP from the ground up adjusting the value production chain for this hyperinflation event.

You cannot simply use exchange rates to calculate because one country is experiencing extremely high inflation relative to the other.

Such comparisons are valid if the rate of inflation between two countries and their currency exchange is relatively stable.

Hack-Hook · Jul 10, 2024

Reality of Iran economy as of today

Flames In The Desert · Jul 10, 2024

A very interesting piece on the increase in iranian-russian trade via the nstc
https://texty.org.ua/projects/110257/russia-has-significantly-increased-trade-iran-can-be-seen-satellite-images/

Eşbah · Jul 10, 2024

Immortals said:
You can’t use $800B figure nor can you just $250B figure. Both are extremes. That is what happens in hyperinflation.

For example: Iran produces a chair under old exchange rate the chair = $10 USD
Under hyperinflation exchange rate chair is now = $3 USD

Does that mean Iran chair is suddenly only worth $3? Of course not.

Yes, it pretty much means exactly what you have written down here. The chair is now worth 3 USD nominally. This is economics 101.

You're mixing up nominal data with purchasing power indicators.

Immortals · Jul 11, 2024

Eşbah said:
Yes, it pretty much means exactly what you have written down here. The chair is now worth 3 USD nominally. This is economics 101.

You're mixing up nominal data with purchasing power indicators.

I’m quite aware what nominal data is.

I’m saying it’s stupid to draw conclusions from nominal data in hyperinflation scenarios for reasons why I mentioned. Can you use it? Sure. But you will draw wrong conclusions.

There’s plenty of economic theory in academia that is hot air and there is plenty of flaws in various forms of international country comparison.

As I said and will reiterate once more, the absolute “value” of Iranian economy is neither $800B nor $200B. And I have said this for a few years now.

Hack-Hook · Jul 11, 2024

Another page in Mr. Jalili treason and how much he damaged Iran
Mr. Zangeneh at last talked after jalili refused to enter debate with him about his accusation

Not only this time he explain the depth of jalili treason and incompetence but also again invite him to a debate again this time jalili and all his shadow lurking friends in one side and he in one side