Germans sceptic to Euro

biko

http://economicsnewspaper.com/policy/spain/71-percent-of-germans-wary-of-euro-37097.html
http://economicsnewspaper.com/policy/spain/the-germans-no-longer-trust-the-euro-37113.html

Konservative und Linke, Arme und Reiche, sie alle sind jetzt Euroskeptiker.
http://www.faz.net/artikel/S30638/schulden-krise-euro-skeptiker-deutschland-einig-wutbuergerland-30448144.html

In a survey conducted by the Institute for Allensbach for the FAS 71 percent of respondents said that they had lost confidence in a common European currency - which is five percentage points more than in April. Three years ago the number of Euro-skeptics were still below 50 percent.

So this time it seems Germans from all walks of life are now reconsidering the Euro. If Germany withdraws from the Euro, which could happen I suppose, then the whole construct falls.

enda1

I imagine if Germany pulls out, its currency will become stronger than the Euro and then they will out-price themselves from their biggest market. Could be economic disaster if they do it. That, and EU countries in trouble might soft default against German banks especially as the EU to new DM becomes so costly.

Forcefield

SO where does that leave us?
If Germany pull out I presume that means the collapse of the Euro?
Any savings that we have then would be worth peanuts I imagine!

biko

The Euro is in the heart of the European Union so without that the EU itself will take a massive blow and there are many parties waiting for that to happen.

Bottle_of_Smoke

Previously saw this touted as an idea to sort things out. IE Ireland and most other countries can't leave as punt nua etc wouldn't be worth the paper its printed on.

Therefore smartest idea is for the good economies to leave.

Though if that were to look like its happening I would immediately lump everything I own into my Sterling account, and I imagine everyone else would too, so seems pointless to me.

later12

I would just say that simply being wary of the Euro, or not having a lot of faith in its future does not itself imply euro-scepticism. Many of us see our faith in the euro diminishing with the passage of time, but that does not mean that we wish it to be so.

Having said that, there is undoubtedly a significant number of Germans who would prefer to return to the D-Mark. But it would be interesting if some sociology or statistics student out there were to analyse the age distribution for euroscepticism in Germany. Many people have it (on merely anecdotal evidence) that nostalgia for the D-Mark is correlated mainly with the older population in Germany.

If that is true, the question becomes one of whether euroscepticism is shuttling its way to its natural death as the blanket of age draws down upon those who can actually remember the old D-Mark of their youth.

Or is euroscepticism something that sets in naturally later in life, like arthritis and senile dementia?

Who knows.

later12

Bottle_of_Smoke wrote: »

Therefore smartest idea is for the good economies to leave.

This view generally presumes that the inefficient deadweights tagging alongside the core powers are of no benefit to the core powers. That would, of course, be quite incorrect.

The Euro needs a deadweight. Without a deadweight, it is the Swiss Franc or the D-Mark, and that would be disastrous for maintaining a competitive exports market. Our currency is still very much in a race to the bottom, and it should be remembered that in preventing it from soaring, we preipherals are bestowing an indirect benefit on the healthier economies - Germany, in particular.

McDave

Sentiment in Germany seems to be running against the Euro and even the EU. There's always the risk that such feelings might crystallise into full-blown Euroscepticism. However, I think average Germans realise that their prosperity and influence is tied closely to the EU. And their economy seems to be ticking over nicely. And has been for quite some time now.

Which is not to say that public opinion won't argue the toss and display support for hard lines against serial dossers like Greece. But when push comes to shove, they won't rock their boat.

My money will be on there being a backlash against Merkel in 2013, but ironically in favour of parties that support more Europeanised solutions (i.e. the SPD and Greens).

greendom

If Germany pulls out of the Euro, that would be the end of the common currency imo. The Euro was founded on the stability and strength of the Deutschmark and if Germany were to withdraw, it would lose all credibility.

Having said that I really can't see it happening.

McDave

McDave wrote: »

My money will be on there being a backlash against Merkel in 2013, but ironically in favour of parties that support more Europeanised solutions (i.e. the SPD and Greens).

From today's FT blogs (response from Charles Grant to a piece by George Soros):

Those in Germany need to rediscover some of the Helmut Kohl spirit, and remember that leadership carries responsibilities. Encouragingly, some Social Democratic and Green politicians seem to get the point.

http://blogs.ft.com/the-a-list/2011/07/11/true-europeans-now-need-a-plan-b/#axzz1RpHiBf1e

I'm pretty convinced that Germans are playing hardball on this one. No doubt there are some overly self-centred interests playing out. But they're also saying they're no longer EU punchbags for digouts.

Having said that, the longer this crisis goes on, the worse it is for Merkel. If she plays her part in engineering a solution (especially after the Constitutional Court challenge is settled), she just might reap some benefits. At this stage it probably won't be enough to save her hide. But if she does nothing, she's leaving the door wide open for an SPD-Green coalition which will firmly act on an EU level.

simplybam

IMHO Germany simply can't afford to pull out of the euro - it would be detrimental to it's economy. Germany is an exporting nation. It's been #1 exporting nation for years (by total value, that is). She's only just been overtaken by China in 2010.

If Germany was to return to the D-Mark it would easily be one of the strongest (if not THE strongest) currency in Europe - and way up there worldwide. Having a strong currency is great when you buy goods, but obviously it won't do you any favours if you want to sell goods. It would make many German products simply too expensive to export and the German economy would suffer greatly especially considering that the vast majority of German exports consist of high value goods (machinery, vehicles, etc.) rather than low value/high volume goods (clothing, consumer electronics, etc.) like China's exports. And Europe is still by far the biggest trading partner for Germany.

So I honestly believe that Germany - in her own interest - has to hang in there and do everything she can to keep the Euro alive

recedite

A second German resigns from ECB.

Amberman

I feel a lot of empathy for the Germans...one of the most industrious, productive and innovative countries on this planet who have admirably endured a past century like few other countries.

They are in a terrible spot.

Do they burden themselves with an insane amount of debt (some estimates as high as 133% of GDP) to keep the Euro alive and preserve their national exporting advantage or do they exit and seriously damage their world class exporting machine?

Rock + hard place.

recedite

Amberman wrote: »

I feel a lot of empathy for the Germans...one of the most industrious, productive and innovative countries on this planet who have admirably endured a past century like few other countries.

In fairness, they were responsible for causing anything they had to endure.
Which brings us to another reason for keeping the euro project alive; to help keep militant nationalism buried.

View

recedite wrote: »

In fairness, they were responsible for causing anything they had to endure.

An interesting view - a lot of posters are of the opinion that they are not responsible for the actions and inactions of our government during the boom and its decision to throw us all under the train for Anglo Irish etc. and that tax-payers here should not be held responsible for the resulting bills.

And this was for decisions taken by our democratically elected government which, in fairness, to them did not go around routinely killing and torturing anyone who even criticised them (as the Nazi dictatorship most certainly did to Germans).

Yet all the Germans - including those who were never supported the Nazis -who did face such horrors from their dictatorship, are "responsible for causing anything they had to endure"?

recedite

View wrote: »

An interesting view - a lot of posters are of the opinion that they are not responsible for the actions and inactions of our government

Right, but I suppose the difference is we got rid of Fianna Fail ourselves, whereas the Germans did not get rid of the Nazis. In both cases we have to live with the consequences afterwards. Admittedly it was easier to get rid of FF though.

Sand

View wrote: »

An interesting view - a lot of posters are of the opinion that they are not responsible for the actions and inactions of our government during the boom and its decision to throw us all under the train for Anglo Irish etc. and that tax-payers here should not be held responsible for the resulting bills.

And this was for decisions taken by our democratically elected government which, in fairness, to them did not go around routinely killing and torturing anyone who even criticised them (as the Nazi dictatorship most certainly did to Germans).

Yet all the Germans - including those who were never supported the Nazis -who did face such horrors from their dictatorship, are "responsible for causing anything they had to endure"?

Great post.

Amberman

I think Dexia banks troubles this week will put the microscope on French bonds sooner or later. I think they can handle Dexia alright, but they are running out of dry powder. What happens if SocGen, BNP or Credit Agricol is next?

You're talking 2 trillions in assets and a few dozen billion in market cap in BNP's case.

If the French lose their top notch credit rating, then more of the bailout falls onto German shoulders in whatever form it takes if it arrives at all...and heres one notable insider who is speculating that the recent actions of many key players are telling her that its almost time for the rest Germany to follow the Weber and Stark and abandon the good ship Euro.

Well worth a read.

http://www.pippamalmgren.com/77.html

meglome

View wrote: »

An interesting view - a lot of posters are of the opinion that they are not responsible for the actions and inactions of our government during the boom and its decision to throw us all under the train for Anglo Irish etc. and that tax-payers here should not be held responsible for the resulting bills.

And this was for decisions taken by our democratically elected government which, in fairness, to them did not go around routinely killing and torturing anyone who even criticised them (as the Nazi dictatorship most certainly did to Germans).

Yet all the Germans - including those who were never supported the Nazis -who did face such horrors from their dictatorship, are "responsible for causing anything they had to endure"?

Stop with your logic and sense.

FreudianSlippers

Amberman wrote: »

I think Dexia banks troubles this week will put the microscope on French bonds sooner or later. I think they can handle Dexia alright, but they are running out of dry powder. What happens if SocGen, BNP or Credit Agricol is next?

You're talking 2 trillions in assets and a few dozen billion in market cap in BNP's case.

If the French lose their top notch credit rating, then more of the bailout falls onto German shoulders in whatever form it takes if it arrives at all...and heres one notable insider who is speculating that the recent actions of many key players are telling her that its almost time for the rest Germany to follow the Weber and Stark and abandon the good ship Euro.

Well worth a read.

http://www.pippamalmgren.com/77.html

She predicted those things happening in "the coming days and weeks" - it's now 3 weeks later and none of those things have happened.

easychair

According to London City's Check Risk, the German and French governments have been trying to shore up their own banks before Greece inevitably defaults and the Euro falls apart. This has led them to pressurise, for example, the Irish government to take on the debt of the Irish banks, thus effectively taking the bad debts the German and French banks had to Irish Banks, and transferring those debts to the Irish taxpayer, thus shoring up their own German & French banks.

In addition, Check Risk is predicting that the Eurozones banks are going to need €700 billion to recapitalise them in the coming months and years, and also predicts that the Euro will not be around in the present form by the end of two years.

The weakness of the EU has also been exposed by this crises, showing that in three years the EU itself has done little to help, and the countries of the EU, particularly Germany and France, have drawn up the shutters and have been working to save their own banks, at the expense of other countries, such as the Irish taxpayer.

View

Amberman wrote: »

and heres one notable insider who is speculating that the recent actions of many key players are telling her that its almost time for the rest Germany to follow the Weber and Stark and abandon the good ship Euro.

Well worth a read.

http://www.pippamalmgren.com/77.html

What governmental position exactly does the lady hold that makes her a "notable insider"?

oscarBravo

easychair wrote: »

...the countries of the EU, particularly Germany and France, have drawn up the shutters and have been working to save their own banks, at the expense of other countries...

I find it ironic that this sort of thing (whether true or not) is leveled as a criticism of the EU - "the nasty big countries are picking on the small countries" - by broadly the same people who don't want there to be an EU, and for all the member states to be allowed to do whatever the hell they want to whomever they want.

recedite

Amberman wrote: »

Well worth a read.

http://www.pippamalmgren.com/77.html

Two points on that link;

They have already ordered the new currency and asked that the printers hurry up

Is this true though?

SPIEGEL: … or at least a monetary reform....
His reference to “monetary reform” is telling. He did not say “fiscal reform”. Fiscal reform would potentially cure the problem. Instead he says “monetary reform” meaning Germany pulls out of the Euro and prints DMarks again.

Another type of "monetary reform" might be a currency pegged to a gold standard, or a new standard based on the price of energy, or maybe even a risk averse lending regime in which fractional reserve lending is curtailed.

It could mean anything.

easychair

oscarBravo wrote: »

I find it ironic that this sort of thing (whether true or not) is leveled as a criticism of the EU - "the nasty big countries are picking on the small countries" - by broadly the same people who don't want there to be an EU, and for all the member states to be allowed to do whatever the hell they want to whomever they want.

I tend to agree and am not sure who would put it in those terms. BUt if someone did, I'd also find it ironic.

easychair

FreudianSlippers wrote: »

She predicted those things happening in "the coming days and weeks" - it's now 3 weeks later and none of those things have happened.

Can I clarify if your view is that the Euro is on a sound footing, and that there is little or no prospect of it breaking up or changing from its present form in the forseeable future?

Predicting the future is notoriously difficult, but there does seem to be a remarkable number of commentators who seem to be of the opinion that the Euro can't continue in its current form.

View

easychair wrote: »

Can I clarify if your view is that the Euro is on a sound footing, and that there is little or no prospect of it breaking up or changing from its present form in the forseeable future?

There can be a world of difference in predicting that something will break up and predicting that it will change from its present form.

Ireland for instance is a fairly awful economic mess at the moment. It is fairly reasonable to predict that it will change from its present form. That is quite different from predicting that it will break-up.

easychair

View wrote: »

There can be a world of difference in predicting that something will break up and predicting that it will change from its present form.

Ireland for instance is a fairly awful economic mess at the moment. It is fairly reasonable to predict that it will change from its present form. That is quite different from predicting that it will break-up.

I see we are entering the twilight world of semantics!

If the Euro changes from its present form, that could also be said that the Euro in the present form has broken up.

It's obvious that a currency can break up or change, but how you propose a country might break up seems uncertain.

In any case, it's all speculation and I was interested to get freudianslippers view as to whether the Euro will remain as it is as a result of this crises, or whether it might change, or break up from its current form.

Amberman

recedite wrote: »

Two points on that link;


Is this true though?

At this stage, it is obviously impossible to know.

Her previous positions were as a Special adviser to the Bush White House and a former member of the Presidents Working group on Financial Markets. Conspiracy theorists know this as the Plunge Protection Team.

She now works as an adviser to UBS...under none other than Axel Weber...arguably the most high ranking German banker in the world. She was also a Senior Special adviser to Deutsche Bank and has worked for the OECD.

She was named a World Leader for Tomorrow by the by the World Economic Forum in Davos. She holds a PhD from LSE and participated in the Harvard Program for National Security.

Her father was a senior trade adviser to 4 White Houses in the 60's and 70's.

She should know and be able to read what is going on in German minds with that sort of access...though I admit timing is next to impossible in this "market".

Amberman

I think we can argue all day about whether she is right or wrong/credible or a muppet...but neither of those conclusions will help anyone.

I think the debate should move on to what the impacts would be if she is right...and how you can protect yourself if what she is saying does come to pass.

The cost of preparing for a German exit is pretty low for most ordinary Irish people. The cost of inaction could be crippling in the very short term...therefore I think some preparations are very sensible, regardless of whether she is right or wrong.

Heres a few things I'd do just in case:

• Prepare for possible bank holidays and have enough currency on hand for a few weeks. (There are better solutions, but this is simple to do).
• Prepare for prices to shoot up and stock up on things you know you will need. (prepay at todays prices...little effect if she is wrong, decent sized positive effect if she is right)
• Pay all outstanding bills and prepay where possible (little effect if she is wrong, decent sized effect if she is right)
• Get out of the Euro and into USD perhaps using Paypal if you don't have enough for a dollar account at your bank (positive either way IMO)
• Move pension assets out of paper assets and into real assets as far as possible (positive either way IMO). This is the trickiest thing to do in my opinion for most people, but the one which will have the most impact.

None of these are hard to do if she is right or are disastrous in the event she is wrong...but if she is right, you should be protected to some degree.

oscarBravo

...and move into a cave with a stock of canned goods and plenty of ammo.

I mean, seriously?

Amberman

Thats the danger here is that people panic and over react like you. There is no need for that.

Those simple steps I mentioned could be taken on a Saturday morning in your local high street and from your computer and involve no significant lifestyle changes.

They are also likely to be net positives whether she is right or wrong....but quite large net winners if she is right.

Don't panic Oscar. Theres no need.

oscarBravo

Amberman wrote: »

Thats the danger here is that people panic and over react like you. There is no need for that.

Whoah, back up. You're telling people to stuff cash under their mattresses, convert their pensions to precious metals, pre-pay their utility bills - and you're accusing me of panicking?

Those simple steps I mentioned could be taken on a Saturday morning in your local high street and from your computer and involve no significant lifestyle changes.

They are also likely to be net positives whether she is right or wrong....but quite large net winners if she is right.

Tell me, do you routinely go around restructuring your finances every time there's a rumour of Germany ditching the Euro? Because if so, presumably you've done so at least four times in the past year or so.

Don't panic Oscar. Theres no need.

That's probably the most accurate thing you've said in this thread so far.

easychair

Amberman wrote: »

Thats the danger here is that people panic and over react like you. There is no need for that.

Those simple steps I mentioned could be taken on a Saturday morning in your local high street and from your computer and involve no significant lifestyle changes.

They are also likely to be net positives whether she is right or wrong....but quite large net winners if she is right.

Don't panic Oscar. Theres no need.

Of course panic is rarely wise. What is wise is judicious planning.

oscarBravo

easychair wrote: »

Of course panic is rarely wise. What is wise is judicious planning.

So do I take it you'll be withdrawing all your cash from the bank, stocking up on canned goods, closing your euro-denominated bank accounts, pre-paying your utility bills and moving your pension to gold?

If so, why didn't you do so the last three or four times this particular rumour kicked off?

easychair

oscarBravo wrote: »

So do I take it you'll be withdrawing all your cash from the bank, stocking up on canned goods, closing your euro-denominated bank accounts, pre-paying your utility bills and moving your pension to gold?

If so, why didn't you do so the last three or four times this particular rumour kicked off?

I long ago closed my Euro bank accounts, but have no need to withdraw any cash I might have in savings, as more than three years ago I moved savings out of the Euro. I felt it prudent then, and now have more and more reason to think that was not an unwise decision. I moved my savings out of the Euro for a number of reasons, and as a precaution against a devaluation, which seems more and more likely.

I tend not to take investment advice from boards.ie, and have always made it my policy to take it from those who are qualified to give it. I have small enough savings, and can't afford to lost them on taking a gamble by leaving them in the Euro.

I have no idea why you seem to have become obsessed with canned foods, as you have mentioned it a few times, and presumably you have your own reasons for that. If you are trying to imply that anyone who moves their saving from the Euro is someone who needlessly panics, then that's your view. However, in my case I took that course of action some time ago as a result of discussing the situation with some advisers.

I don't tend to made decisions about my savings based on rumours, so that, and the fact that I moved my savings out of the Euro three years ago, would be the answer to your last point.

Amberman

Ok...lets take these one at a time with a cool head shall we Oscar?

oscarBravo wrote: »

You're telling people to stuff cash under their mattresses

Keep a few weeks expenditure on hand is what I said. Where is the loss if she is wrong? What is the upside if she is right? How hard is this to do? What are banks paying these days on instant access deposits?

convert their pensions to precious metals

While I didn't actually say that, I do consider it a good part of a portfolio. Silver, despite being pretty volatile and down 40% from its peak, is still up 8 to 10 fold in the last decade or so while stocks are flat. Again, where is the loss if she is wrong? What is the upside if she is right? How hard is this to do?

pre-pay their utility bills

Again, where is the loss if she is wrong? What is the upside if she is right? How hard is this to do?

I have been heavily invested in PM's and PM stocks (SLW and PAAS) for a considerable time and I add to them regularly on dips. I also sold my house for top dollar in late 2006 and the returns I've had from my then 50% equity currently enables me to buy 3 similar houses for cash...and that was just a trade on my house. 70% of my pension is in Blackrocks Gold and General fund...which has roughly doubled for me. 30% in cash, waiting for the real bargains to appear...in the Spring I reckon.

oscarBravo

Amberman wrote: »

Keep a few weeks expenditure on hand is what I said. Where is the loss if she is wrong? What is the upside if she is right? How hard is this to do? What are banks paying these days on instant access deposits?

What is the reason for doing this? Are you suggesting that if Germany leaves the Euro, it will be impossible to get cash out of the bank?

While I didn't actually say that, I do consider it a good part of a portfolio. Silver, despite being pretty volatile and down 40% from its peak, is still up 8 to 10 fold in the last decade or so while stocks are flat. Again, where is the loss if she is wrong? What is the upside if she is right? How hard is this to do?

I'm reminded of Glenn Beck's constant scaremongering about how desperately important it is to sell securities and buy gold, thereby driving up the price of gold, which benefits... Glenn Beck.

Investing in metals may or may not be a good idea. Whether or not it's a good idea has little to do with the repeated rumours about a return to Deutsche Marks.

Again, where is the loss if she is wrong? What is the upside if she is right? How hard is this to do?

You don't see a downside to giving money to somebody else before you owe it to them? You've never heard of opportunity cost?

I have been heavily invested in PM's and PM stocks (SLW and PAAS) for a considerable time and I add to them regularly on dips. I also sold my house for top dollar in late 2006 and the returns I've had from my then 50% equity currently enables me to buy 3 similar houses for cash...and that was just a trade on my house. 70% of my pension is in Blackrocks Gold and General fund...which has roughly doubled for me. 30% in cash, waiting for the real bargains to appear...in the Spring I reckon.

Bully for you. This was all as a direct result of previous rumours about the collapse of the Euro, was it?

Tell me: did you believe that Germany was printing DMs when the same rumour was spread last May and last June, and a year before that? If not, why do you believe it now?

oscarBravo

easychair wrote: »

I long ago closed my Euro bank accounts...

Do you live in Ireland?

I have small enough savings, and can't afford to lost them on taking a gamble by leaving them in the Euro.

Why is it less of a gamble leaving them in any other currency? Do you subscribe to the view that the Euro is the only currency subject to exchange rate gains and losses?

I have no idea why you seem to have become obsessed with canned foods, as you have mentioned it a few times, and presumably you have your own reasons for that.

I'm sorry, perhaps Amberman was talking about stocking up on toilet paper instead of food.

If you are trying to imply that anyone who moves their saving from the Euro is someone who needlessly panics, then that's your view.

I have my views on people who withdraw cash, stock up on (unspecified) supplies, pre-pay utility bills and re-structure their finances based on rumours, yes. Other people are free to form different views.

I don't tend to made decisions about my savings based on rumours, so that, and the fact that I moved my savings out of the Euro three years ago, would be the answer to your last point.

Well, bully for you too, but Amberman is proposing that people do all these things on the strength of a rumour.

FreudianSlippers

What's going to be the point of having cash if the Euro collapses?

easychair

oscarBravo wrote: »

Do you live in Ireland? Why is it less of a gamble leaving them in any other currency? Do you subscribe to the view that the Euro is the only currency subject to exchange rate gains and losses? I'm sorry, perhaps Amberman was talking about stocking up on toilet paper instead of food. I have my views on people who withdraw cash, stock up on (unspecified) supplies, pre-pay utility bills and re-structure their finances based on rumours, yes. Other people are free to form different views. Well, bully for you too, but Amberman is proposing that people do all these things on the strength of a rumour.

I am not replying on behalf of Amberman, and have no clue about Amberman. I can only speak on my own behalf.

Your views on "people" who withdraw cash, stock up on (unspecified) supplies, pre-pay utility bills and re-structure their finances based on rumours suggest that you seem to like stereotypes. As I have just bought six cases of wine today, I guess you might like to include me in those who you consider to be "stocking up" and include me in your stereotype viewpoint. Whether you do or not is of no interest to me.

oscarBravo

easychair wrote: »

Your views on "people" who withdraw cash, stock up on (unspecified) supplies, pre-pay utility bills and re-structure their finances based on rumours suggest that you seem to like stereotypes. As I have just bought six cases of wine today, I guess you might like to include me in those who you consider to be "stocking up" and include me in your stereotype viewpoint. Whether you do or not is of no interest to me.

Did you buy the wine because of the rumour that Germany is printing Deutsche Marks?

You didn't answer the question about whether you live in Ireland.

greendom

What is the benefit in pre-paying utility bills ?

Amberman

FreudianSlippers wrote: »

What's going to be the point of having cash if the Euro collapses?

If Germany leaves, the Euro wont collapse...but it will be seriously devalued. Having cash enables you to mitigate any bank holidays which are common at these big turning points to enable you to buy goods and services until normal functioning is restored.

Amberman

greendom wrote: »

What is the benefit in pre-paying utility bills ?

You get to pay at todays rates rather than at future rates which are likely to be significantly higher should this come to pass.

Also, you get to sidestep inflation in ultility prices in any case which is quite high at present.

As for opportunity costs, what are they? 1% in a checking account or a savings account. Not really a serious consideration compared to a 30% devaluation if this comes to pass.

Amberman

oscarBravo wrote: »

Amberman is proposing that people do all these things on the strength of a rumour.

You understand that by the time it becomes a known fact, its too late to do anything...right?

Be my guest...wait for a factual announcement to take steps which are:

1. Winners whether Germany exits or not
2. Substantial winners should the rumour be correct

It looks totally risk free to me.

Where am I wrong?

easychair

oscarBravo wrote: »

Did you buy the wine because of the rumour that Germany is printing Deutsche Marks?

You didn't answer the question about whether you live in Ireland.

I've already said that I don't make decisions based on rumours.

You are right, I didn't answer the question about whether or not I live in Ireland. Why it's relevant seems uncertain, and I am not sure how to define "live". Certainly, i don't "live" in Ireland full time.

oscarBravo

Amberman wrote: »

Having cash enables you to mitigate any bank holidays which are common at these big turning points...

"Bank holidays"? Is that a euphemism for something?

...to enable you to buy goods and services until normal functioning is restored.

So euros that you withdraw and keep under a mattress won't be devalued, but euros that you leave in the bank will?

Amberman wrote: »

You get to pay at todays rates rather than at future rates which are likely to be significantly higher should this come to pass.

Utility prices are set by the energy regulator. Are you suggesting that the regulator will suddenly allow massive price increases as a result of Germany printing Deutsche Marks?

Also, you get to sidestep inflation in ultility prices in any case which is quite high at present.

How do you make that out? If I send Airtricity a few hundred notes and tell them to credit my account, and then prices rise - do you think they'll send me my next bill at today's rates?

As for opportunity costs, what are they? 1% in a checking account or a savings account. Not really a serious consideration compared to a 30% devaluation if this comes to pass.

There's more to opportunity cost than bank interest. Money you've given to someone else before you need to is money you can't do other useful things with - but they can.

But back to the point - did you believe the last three or four rounds of rumours about Deutsche Marks? If not, why not? What's different this time?

oscarBravo

Amberman wrote: »

You understand that by the time it becomes a known fact, its too late to do anything...right?

This is also true of earthquake preparation. I'm not preparing for an earthquake, and I won't start preparing for one on the strength of a rumour.

It looks totally risk free to me.

It looks pretty pointless to me.

easychair wrote: »

I've already said that I don't make decisions based on rumours.

Therefore your purchase of wine is completely irrelevant to the discussion, and I have no idea why you brought it up.

You are right, I didn't answer the question about whether or not I live in Ireland. Why it's relevant seems uncertain, and I am not sure how to define "live". Certainly, i don't "live" in Ireland full time.

Well, those of us who do "live" in Ireland full time (I'm not sure what the significance of the danger quotes is) find it useful to have bank accounts denominated in the currency with which we transact our daily lives. With the exception of one former Taoiseach, who isn't exactly a role model for me.

Amberman

oscarBravo wrote: »

What is the reason for doing this? Are you suggesting that if Germany leaves the Euro, it will be impossible to get cash out of the bank?

Yes. Bank holidays during large currency revaluations are common...even standard practise.

I'm reminded of Glenn Beck's constant scaremongering about how desperately important it is to sell securities and buy gold

Thats been a pretty good trade for quite a long time.

Investing in metals may or may not be a good idea. Whether or not it's a good idea has little to do with the repeated rumours about a return to Deutsche Marks.

I disagree. If there is an exit of Germany, there will be massive capital flight to safe havens. Since the Japanese, Canadians and Swiss have bolted their safe haven doors or announced their intention to do so, Gold is an obvious beneficiary of such a flight to safety.

Tell me: did you believe that Germany was printing DMs when the same rumour was spread last May and last June, and a year before that? If not, why do you believe it now?

No, because "Dave" in the pub isn't very credible.

The woman who has started this works with Axel Weber who went to UBS and one of his first actions was to calculate the cost of a Eurozone breakup...and because other notable German bankers have left the ECB...I could go on....but this woman clearly has the ear of someone who was being lined up to take over the ECB. She also used to work at a very high level in Deutsche bank, the OECD and the White House Markets team.

If that isn't an insiders line, I don't know what is.

Its pretty easy to ignore "Dave", but this woman is not so easy to ignore. Reading the article, it makes a lot of sense.

That however doesn't make it true...but it does make taking simple, win-win steps which can be completed in a morning very sensible for practical people who actually don't really know what is going to happen, but who want to protect themselves.

easychair

oscarBravo wrote: »

Therefore your purchase of wine is completely irrelevant to the discussion, and I have no idea why you brought it up. Well, those of us who do "live" in Ireland full time (I'm not sure what the significance of the danger quotes is) find it useful to have bank accounts denominated in the currency with which we transact our daily lives. With the exception of one former Taoiseach, who isn't exactly a role model for me.

I brought it up because you stated "I have my views on people who ...stock up on (unspecified) supplies...".

You may have missed the bit where I said I had moved my savings out of the Euro over three years ago, and you seem to be mixing up a savings account with a current account, which is the sort of account you need to "to have bank accounts denominated in the currency with which we transact our daily lives".

As I don't keep savings in the same account which I use to transact my daily life, it's quite possible to have a current account in Euro, and not have a saving account in Euro.