# Is this a sensible strategy: deposits with EBS, PTSB, KBC & UB?



## Baba O'Riley

I've got deposits with EBS, PTSB, KBC, UB.

I had to spread everything to be covered by the guarantee.

I have not opened any foreign accounts as i wanted to minimse on complications and/or extra fees associated, and i'm lazy.


Are there many people like me using Irish Institutions for short term deposts? maximum term i have is 14 months, interest paid annually.

AM I MAD?? if Ireland (or the euro) was to go wallop tomorrow would i be up a creek?

any opinions/suggestions apreciated.


----------



## Lightning

There are plenty of people like you. One would think that only a small minority of the population of foreign bank accounts outside of the ROI. 

If the EUR goes, then your deposit will get converted into a new currency and most likely suffer devaluation. Plenty of threads on that here.


----------



## Baba O'Riley

Thanks Ciaran. I've read the threads alright, good stuff in there. I've read so much that i went from thinking i should move everything out of Ireland to now thinking that the gains arent worth the hassle. The foreign deposit rates (bar AUS$) don't seem attractive enough to warrant paying charges/conversion rates and whatever else to set them up and/or to move the money around in the future. I think i'll sit with short term, accessable deposits, in Irish institutions....gulp


----------



## kdoc

Baba, I'm exactly like you. And there are thousands more. Nobody has yet lost any money from Irish banks. Further, your money has worked harder for you in terms of interest than it would have elsewhere.


----------



## Marc

Uncertainty is a fact of life. It is always with us. It will never go away all we will do is move onto worrying about something else in the future.

Many of us fail to understand investing and so either worry constantly or switch off and pretend there is nothing to think about.

The antidote to uncertainty is not speculation about the future it is diversification. Not having all your eggs in one basket.

But this doesn't mean open a few bank accounts - job done.

Over the long term cash deposits are a poor investment due to loss of purchasing power. After tax and inflation bank deposits typically lose money in real terms. They offer short term stability and long term lack of security.

The prudent investor keeps their savings in several different banks with different tax payers underwriting the banking system ( ie not all Irish banks) but there is nothing to be gained from speculating on foreign currencies - if your liabilities are in Euros keep your savings in Euros.

The balance of your capital that is not required for immediate planned expenditure or an emergency fund should be invested according to your willingness, ability and need to take investment risk.

The question therefore should not be am I mad keeping all my savings in Irish banks ? but rather am I mad keeping all my savings in cash? to which the answer may well be yes especially if we enter a period of high inflation.


----------



## Bobby1

You also have your deposits in 2 irish banks, not 4. KBC and UB are not Irish owned


----------



## Baba O'Riley

Bobby1 said:


> You also have your deposits in 2 irish banks, not 4. KBC and UB are not Irish owned




Agreed Bobby, I suppose what i mean is that i have the accounts in Euro's and in companies based in Ireland rather than Germany or in Canadian $$ or something


----------



## Renter7

Bobby1 said:


> You also have your deposits in 2 irish banks, not 4. KBC and UB are not Irish owned


 
KBC and Ulster Bank are Irish Banks. They are Irish Banks that have a foreign parent. There is a difference.


----------



## celebtastic

If Ireland gets kicked out of the euro, all euro savings in Irish banks will be converted to an Punt Nua overnight and your savings will be wiped out.

Get some or all of that cash offshore as soon as possible. 

As for it being a hassle, much of it you can probably do on-line or through the post. The only hassle is putting a stamp on an envelope

Good list of offshore accounts here:
http://moneyfacts.co.uk/compare/offshore/euro/


----------



## DerKaiser

Marc said:


> The question therefore should not be am I mad keeping all my savings in Irish banks ? but rather am I mad keeping all my savings in cash? to which the answer may well be yes especially if we enter a period of high inflation.


 
Very good point.

Also, as you state, it is important to remember that the currency you spend your money in is typically the safest one to save it in e.g. you're playing with fire putting your money into Canadian Dollars unless you're planning to move there for good!


----------



## Jim2007

celebtastic said:


> If Ireland gets kicked out of the euro, all euro savings in Irish banks will be converted to an Punt Nua overnight and your savings will be wiped out.



Simply wrong!  The Irish government could in theory is a Punt Nua, but without a constitutional referendum, they could not convert an currency.... go study the EU treaties!


----------



## celebtastic

Jim2007 said:


> Simply wrong! The Irish government could in theory is a Punt Nua, but without a constitutional referendum, they could not convert an currency.... go study the EU treaties!


 
Simply wrong 

EU treaties and constitutional referenda would mean little if Ireland were forced out of the euro.


----------



## celebtastic

cashier said:


> So Jim2007, does this mean if in the unlikely event Ireland will leave the Euro, Irish people would have plenty of time to move cash savings and they don't have to to go to the hassle and stress of moving it for now?


 
No


----------



## celebtastic

I suggest you have a look at Brendan's excellent thread on how to protect your savings from a eurozone breakup:

http://www.askaboutmoney.com/showthread.php?t=163133


----------



## celebtastic

Anyway to get back to the OP's point, there is a really good post here from Brendan on the compelling reasons why you might want to keep your money offshore (in this case in a Euro account in Germany):
http://www.askaboutmoney.com/showpost.php?p=1223570&postcount=5



> I see very little risk in transferring your money from an Irish bank account to a German bank account. If the euro doesn't break up, you will be no worse off. If the euro does break up, you will be better off.


 
Wise words


----------



## Jim2007

celebtastic said:


> No



Just because you say it does not make it so!  Go away and come back with some legal basis and then we can have a discussion!


----------



## celebtastic

Jim2007 said:


> Just because you say it does not make it so! Go away and come back with some legal basis and then we can have a discussion!


 
And again simply wrong !

EU treaties and constitutional referenda would mean little if Ireland were forced out of the euro.


----------



## Jim2007

cashier said:


> So Jim2007, does this mean if in the unlikely event Ireland will leave the Euro, Irish people would have plenty of time to move cash savings and they don't have to to go to the hassle and stress of moving it for now?



What it means is that the kind of over night horror pedaled by some people has not basis in hard facts, which are what you should deal in when managing your finances.

Any withdrawal from the Euro will be a drawn out process, with many twists and turns along the way.  Now the Euro can probably survive the exit of Greece, but anyone else exiting would bring the whole apple card tumbling down.  Which in reality means that it does not matter where you have your Euros if it blows!

People are fooling themselves if they think that moving their Euros to Germany will protect them... it will not.  The amount of foreign deposits with German banks is at such a level that it would cause serious economic problems in German if they were to convert them to the Neu Mark on the break up of the Euro and I can't imagine the Germans going along with that!

And when it comes down to the actual banks themselves, people should realize that the German banks they are depositing their money with are less well capitalized than the Irish banks and that German can afford to let a few banks go to the wall!

For me the bottom line is that shipping Euros around may make you feel good, but I very much doubt that it is in reality do much to reduce your exposure!


----------



## celebtastic

Jim2007 said:


> For me the bottom line is that shipping Euros around may make you feel good, but I very much doubt that it is in reality do much to reduce your exposure!


 
Food for thought.

Thank you for your response Jim 2007.

So, if not Euros, what currency do you think we should be putting our life savings in? 

Or should we just keep all our funds in Irish bank accounts and watch as they evaporate, if the eurozone disintegrates as looks increasingly likely?

EU treaties and constitutional referenda would mean little if Ireland were forced out of the euro.

Jim - you may want to read this excellent post from Brendan on what to do if Ireland is forced out of the Euro:
http://www.askaboutmoney.com/showthread.php?t=163133


----------



## magicalmoney

Quote from post above-'then your deposit will get converted into a new currency and most likely suffer devaluation'
Can anybody give any idea roughly how much this devaluation would be?
Would it be extreme that €100 would end up being €5 or is this totally extreme?Thanks


----------



## celebtastic

magicalmoney said:


> Quote from post above-'then your deposit will get converted into a new currency and most likely suffer devaluation'
> Can anybody give any idea roughly how much this devaluation would be?
> Would it be extreme that €100 would end up being €5 or is this totally extreme?Thanks


 
There was an article in the Sunday Times last week predicting a devaluation in excess of 50%. 

The most recent precedent is when Argentina was forced to break its link to the US Dollar, which resulted in a 75% depreciation in the currency:
http://en.wikipedia.org/wiki/Argentine_peso#Peso_convertible.2C_from_1992

These are the reasons why you need to get your life savings out of Ireland as soon as possible.

As it is stated up above, if a run on the banks start it will be too late to get your money out then.


----------



## ardmacha

> There was an article in the Sunday Times last week predicting a devaluation in excess of 50%.



I didn't read that article and doubt if it said that, exactly. 
Some Euro currencies could decline by that amount, Greece certainly and possibly Portugal. Ireland has a large balance of trade surplus and broadly balanced balance of payments, why should we devalue hugely? Nomura suggest a 25% devaluation but Bank of America suggest a 9% revaluation! A modest devaluation seems most likely, say 10%. 

I don't see why we should leave the Euro, unless it breaks up. Our problem is debt and devaluation makes debt even harder to repay. We could devalue and repudiate the debt, but it would be easier to just repudiate the debt and stay in the Euro!


----------



## Jim2007

ardmacha said:


> Ireland has a large balance of trade surplus and broadly balanced balance of payments, why should we devalue hugely? Nomura suggest a 25% devaluation but Bank of America suggest a 9% revaluation! A modest devaluation seems most likely, say 10%.



Yes, I've read a few reports along these lines and I tend to agree with them. There might be an initial devaluation, but it would tend to appreciate provided we maintain the net surplus.....

And of course it goes without saying that people who have stuffing money into Germany would stand to loose!


----------



## celebtastic

ardmacha said:


> I didn't read that article and doubt if it said that, exactly.


 
Oh but it did

UK edition 20th May - page 13. I would provide a link, but its behind a paywall.

The lead banner on the front of the London edition this week was "Euro meltdown", which pretty much says it all.



ardmacha said:


> Some Euro currencies could decline by that amount, Greece certainly and possibly Portugal. Ireland has a large balance of trade surplus and broadly balanced balance of payments, why should we devalue hugely? Ireland has a large balance of trade surplus and broadly balanced balance of payments, why should we devalue hugely?


 
Once the euro starts to unravel, as has already begun with Greece, the situation will quickly spin out of Ireland's control.

Ireland still has a huge cost base structural problem, down to issues like an overgenerous welfare state and high public sector pay rates coupled with archaic working practices.

Have you been shopping to Northern Ireland recently? Have you ever wondered why the weekly shop is so much cheaper up there. 

We inflated Ireland's cost base massively from 1997 - 2007, and that needs to be unwound, either through puy cuts and tax hikes for decades or through a rapid devaluation.

Ireland's currency probably needs to devalue 20 - 30% from its main trading partners in the UK, Germany, and the US but, like we have seen in the property market, once this correction gets underway the end state is probably more likely to be 50% down.



ardmacha said:


> Nomura suggest a 25% devaluation but Bank of America suggest a 9% revaluation! A modest devaluation seems most likely, say 10%.


 
Link to these reports? The range of their variation should suggest that they are of limited value.

Even at your "best case" scenario of a 10% reduction in the value of your savings - why risk it?




ardmacha said:


> I don't see why we should leave the Euro, unless it breaks up.


 
Ireland will soon not have the luxury of making that decision for ourselves. Once Portugal and Greece are ejected, Ireland will be out the door shortly thereafter.



ardmacha said:


> Our problem is debt and devaluation makes debt even harder to repay. We could devalue and repudiate the debt, but it would be easier to just repudiate the debt and stay in the Euro!


 
As the Greeks have found, it's not an either / or choice. 

Greece (and Portugal, Spain and Ireland) cannot repay their debt as interest rates rise to unsustainable levels, and so will be forcibly ejected. 

If you are wise, you will get your cash out of Ireland while there is still time.


----------



## celebtastic

Jim2007 said:


> Yes, I've read a few reports along these lines and I tend to agree with them.


 
Which reports? A specific reference or two would be useful



Jim2007 said:


> There might be an initial devaluation, but it would tend to appreciate provided we maintain the net surplus.....


 
Please point to another instance where this happened, after a forced break of a currency link. I fear there is no precedence for this.

Even Ireland's tightly managed break of the link with sterling was supposed to see the Punt appreciate dramatically.

Within no time, it had lost 20% of its value against sterling.



Jim2007 said:


> And of course it goes without saying that people who have stuffing money into Germany would stand to loose!


 
The German banking system is being bolstered by currency inflows from other eurozone countries. Look at how its cost of government debt has fallen through the floor.

The eurozone crisis strengthens the German banking system rather than weakens it.


----------



## Chris

Jim2007 said:


> People are fooling themselves if they think that moving their Euros to Germany will protect them... it will not.  The amount of foreign deposits with German banks is at such a level that it would cause serious economic problems in German if they were to convert them to the Neu Mark on the break up of the Euro and I can't imagine the Germans going along with that!



What are you basing this on? A massive inflow of cash means that there is a huge amount of capital available for investment. It strengthens the currency which reduces costs of imports, especially oil and gas which Germany has none of. 
The idea that a strong currency is harmful to an economy is a total fallacy and was proven wrong in Germany after WWII. Foreign governments and opposition leaders predicted that Germany would be a basket case if it didn't devalue, but Ludwig Erhardt did the exact opposite, resulting in the biggest economic boom the country ever saw. Jim, I believe you live in Switzerland and if you speak German I would suggest getting a copy of "Wohlstand für Alle", it outlines Erhardt's battle and success to roll out a strong currency and free market policy.



ardmacha said:


> I didn't read that article and doubt if it said that, exactly.
> Some Euro currencies could decline by that amount, Greece certainly and possibly Portugal. Ireland has a large balance of trade surplus and broadly balanced balance of payments, why should we devalue hugely? Nomura suggest a 25% devaluation but Bank of America suggest a 9% revaluation! A modest devaluation seems most likely, say 10%.
> 
> I don't see why we should leave the Euro, unless it breaks up. Our problem is debt and devaluation makes debt even harder to repay. We could devalue and repudiate the debt, but it would be easier to just repudiate the debt and stay in the Euro!



The ECB published a paper a year or two ago stating that there was no legal basis to force a country out of the Euro. If a country leaves it will be because that country foolishly believes that by leaving, debt problems can be handled through their own currency and devaluing it. Contrary to your statement devaluation would result in the debt burden being reduced, but this would come at the expense of the creditors and savers. 

There is not a single country in the world that is actually pursuing policies that would strengthen their currency, which gives me no reason to believe that the Irish government would leave the Euro in pursuit of a stronger currency.

Bottom line is though that Marc made a good point about why you would have any significant amount of money in cash in the first place. If you're afraid of a Euro breakup then you should look at putting your money in physical things like equities and commodities, which is what I have done. The small amount of cash in my investments is not in Ireland though, because of the reasons I mention above.


----------



## PolkaDot

Chris said:


> Bottom line is though that Marc made a good point about why you would have any significant amount of money in cash in the first place. If you're afraid of a Euro breakup then you should look at putting your money in physical things like equities and commodities, which is what I have done. The small amount of cash in my investments is not in Ireland though, because of the reasons I mention above.



Is this not also risky? The value of equities and commodities can be quite volatile.

Most people with cash savings have chosen that option in the first place because they want a low risk saving option.


----------



## Palerider

It really depends on where you are in your life cycle, I've worked almost 30 years in the financial sector and right now I'm all cash and staying that way, I don't propose a long reply as each to their own although in general I always agreed with diversification, an old client of mine sitting on millions disagreed strongly and apart from purchasing a pad in London ( that did really well by the way ) they stayed in cash, many people tried to tempt them away with claims of inflation risk, diversification is good and so on but the do nothing approach worked and that's working for me now, I'm diversified across several Irish and foreign owned Banks and mindful of the applicable Govt guarantees, yes I considered a day return flight to Germany but quickly discounted it, If a person where to believe or rely on much commentary on this site then the poor Euro would be dead and gone a long time back, 4% annual deposit rates...Yes please I'll have that all day thank you very much !


----------



## The Ghoul

Palerider said:


> It really depends on where you are in your life cycle, I've worked almost 30 years in the financial sector and right now I'm all cash and staying that way, I don't propose a long reply as each to their own although in general I always agreed with diversification, an old client of mine sitting on millions disagreed strongly and apart from purchasing a pad in London ( that did really well by the way ) they stayed in cash, many people tried to tempt them away with claims of inflation risk, diversification is good and so on but the do nothing approach worked and that's working for me now, I'm diversified across several Irish and foreign owned Banks and mindful of the applicable Govt guarantees, yes I considered a day return flight to Germany but quickly discounted it, If a person where to believe or rely on much commentary on this site then the poor Euro would be dead and gone a long time back, 4% annual deposit rates...Yes please I'll have that all day thank you very much !


+1, my thoughts exactly. I own one property with no debt and everything else is in cash. Most of it is in various Irish State Savings now thanks to good interest rates and favourable tax. 

There are plenty of people out there like you, me and your multi millionaire former client. They tend to stay fairly quiet and generally don't post on internet forums though.

I'm keeping a close eye on inflation and am pleased with how things are working out. Inflation is my main concern, not "eurogeddon". Far too much hysteria about the latter and it is quite amusing to see people using the Sunday Times (one of Murdoch's europhobe rags, abysmal paper) as sources for their views.

FWIW if the eurogeddon that is being described here does happen (which it won't) all bets are off, there are absolutely no guarantees that having a German bank account, gold, shares etc. will protect a person's wealth in the way they hope.

I really think that people have skewed ideas when it comes to assessing risk and making subsequent investment decisions. There was a comment in this thread or another eurogeddon thread about how people should take all their money out of Irish banks even if the chance of euro collapse is 0.01%. This post will be deleted if not edited immediately wept.


----------



## kdoc

Ghoul, that's my position too: one property and no debt. My money is in a mix of State Savings, Irish banks & Irish branches of foreign banks. So far the sky hasn't fallen down, despite the doomsday pedlars.


----------



## ardmacha

celebtastic said:
			
		

> Have you been shopping to Northern Ireland recently?



Yes. (Hint the clue is in my username)

In early 2009 the Euro was 95p, since then UK inflation has been 10%, and the Euro is now 80P. That is a change of one quarter in Irish competitiveness and prices in NI are no longer the incredible value they once were. The Euro too has declined against the dollar, improving Irish competitiveness somewhat there too. 



			
				Chris said:
			
		

> Contrary to your statement devaluation would result in the debt burden  being reduced, but this would come at the expense of the creditors and  savers.



It depends on whose debt you are talking about. Mortgage debt internally would become Punts and would be mitigated by the higher inflation caused by any devaluation, at the expense of savers However, the government and the Irish banks owe a lot of money to the IMF, ECB etc and this cannot be re-denominated in Punt without being a default.


----------



## callybags

The Ghoul said:


> +1, my thoughts exactly. I own one property with no debt and everything else is in cash. Most of it is in various Irish State Savings now thanks to good interest rates and favourable tax.
> 
> There are plenty of people out there like you, me and your multi millionaire former client. They tend to stay fairly quiet and generally don't post on internet forums though.
> 
> I'm keeping a close eye on inflation and am pleased with how things are working out. Inflation is my main concern, not "eurogeddon". Far too much hysteria about the latter and it is quite amusing to see people using the Sunday Times (one of Murdoch's europhobe rags, abysmal paper) as sources for their views.
> 
> FWIW if the eurogeddon that is being described here does happen (which it won't) all bets are off, there are absolutely no guarantees that having a German bank account, gold, shares etc. will protect a person's wealth in the way they hope.
> 
> I really think that people have skewed ideas when it comes to assessing risk and making subsequent investment decisions. There was a comment in this thread or another eurogeddon thread about how people should take all their money out of Irish banks even if the chance of euro collapse is 0.01%. This post will be deleted if not edited immediately wept.


 


			
				kdoc said:
			
		

> Ghoul, that's my position too: one property and no debt. My money is in a mix of State Savings, Irish banks & Irish branches of foreign banks. So far the sky hasn't fallen down, despite the doomsday pedlars.


 
Two of the most sensible posts amid a mass of hysteria.


----------



## celebtastic

ardmacha said:


> In early 2009... since then UK inflation has been 10%.


 
Complete and utter hogwash

[broken link removed]


----------



## celebtastic

callybags said:


> Two of the most sensible posts amid a mass of hysteria.


 
So do you think Brendan's post on how to protect yourself against a eurozone break up is hysterical?

I found it very sensible and far more reasoned than most of the "head in the sand" posts in from some in this thread.

It makes timely reading, as the end game with Greece approaches:

*Key Post* Protecting your savings against a euro breakup


----------



## yenom

I  moved 25% of my savings to Sterling in Northern Ireland last year.
So far my Sterling is worth more in Euro’s now than when I moved it.
On these forums people keep saying you’ll lose so much switching between currencies. As far as I am concerned there are two currencies 
on this island. I can make any large purchases in Northern Ireland if things favour Sterling so there’s no switching back and forth..
If there was Eurogeddon no one knows how it would affect Sterling. But I do know I would like the options of  two currencies if things go bad.


----------



## ardmacha

celebtastic said:
			
		

> Complete and utter hogwash
> [broken link removed]



Do you ever read what you post? You describe my contention that prices had risen by 10% as "hogwash" and then post a chart showing UK inflation as 3-4% per annum!! An ability to add is a help in a forum such as this. 

Check out the UK CPI and see that the from April 2009 to April 2012 the index has risen by 11.6%. 
[broken link removed]


----------



## kdoc

celebtastic said:


> So do you think Brendan's post on how to protect yourself against a eurozone break up is hysterical?
> 
> I found it very sensible and far more reasoned than most of the "head in the sand" posts in from some in this thread.
> 
> It makes timely reading, as the end game with Greece approaches:
> http://www.askaboutmoney.com/showthread.php?t=163133




celeb, I'd love to know exactly - or even roughly - how many AAMers have actually got on a plane and opened accounts in Germany. According to some posts, it's not all plain sailing opening such an account over the phone. One poster, when he identified himself as Irish was almost told to hump-off.


----------



## celebtastic

kdoc said:


> celeb, I'd love to know exactly - or even roughly - how many AAMers have actually got on a plane and opened accounts in Germany.


 
I have no idea of the numbers - neither do you



kdoc said:


> According to some posts, it's not all plain sailing opening such an account over the phone. One poster, when he identified himself as Irish was almost told to hump-off.




Don't know about Germany, but I do know that it is very easy to open an account in Jersey or the Isle of Man.

My own family are using the UK Nationwide in the Isle of Man, using a combination of euro and other currencies:
[broken link removed]

Best buy list of offshore euro accounts here:
http://moneyfacts.co.uk/compare/offshore/euro/

I'd be minded to keep some cash out of euros. The euro is likely to stay low while the whole problems with Greece (and now Spain) are sorted out.


----------



## kdoc

celebtastic said:


> I have no idea of the numbers - neither do you



That's why I was asking - in the hope that that someone could furnish the numbers. I suspect it's quite small. There's a well known psychological phenomenon that 'what people say is often at variance with what they do'.


----------



## celebtastic

kdoc said:


> I suspect it's quite small.



What do you base that estimate on?

Do you really think that Irish people should keep their life savings in Irish banks risking them being wiped out if the eurozone unravels, or move them to a more secure offshore environment?


----------



## kdoc

celebtastic said:


> What do you base that estimate on?
> 
> Do you really think that Irish people should keep their life savings in Irish banks risking them being wiped out if the eurozone unravels, or move them to a more secure offshore environment?



celeb, I said I 'suspect', I don't have any figure, estimate or otherwise. Now, my suspicion is based on the phenomenon I mentioned in my previous post. If the eurozone unravels it's not at all clear what will happen to funds based anywhere,  including your sterling accounts.


----------



## Jim2007

cashier said:


> What is your agenda here OP??  You have recently come on to this website and have been continually harping on to people  to get their deposits out of Ireland and into an offshore nationwide account.



Having gone back and review all the posts by the OP it is clear that he is one of these people who does not let the facts interfere with his opinion...  As far as I can figure he has concluded:

- Countries can be kicked out of the EU/Eurozone without any reference to the establishment treaties
- Banks with low T1 ratios are safer than ones with high ratios
- There are different shades of the Euro
- Putting your money anywhere other than Ireland is the safe option

Luck will play an important part in the outcome for him....

My last comment on this discussion!


----------



## penury

cashier said:


> Maybe most people are quite happy to keep their deposits in Ireland.  Also most posters on here are shall we say quite saavy when it comes to their finances and the economy and they smart enough to make up their own minds.



along those lines being an older person in the second half of my 60's I would like to add my own 'halfpenny' worth - even though most people wouldn't listen to me or give me the time of day.

When you live in a country such as Ireland as a regular normal (not rich or super rich individual) and is fortunate enough to have a small amount of money - it is always best IMO to keep the money as close to your chest as possible and not always about chasing the extra point of interest.

I like to put mine under the mattress, that way I know where it is at all times.

From this old head if it has to be a bank, I'd be putting my money somewhere that I know I can walk in and see it, that you can call the funds at anytime with minimum cost, minimum risk and without having to deal with FX rates. 

Internet, electronic offshore banking would not let me sleep well at night. No different to me than stock market investing wondering will it go, up, down or disappear.

When it is in the currency where you live, shop and go about your daily life - life is so much easier without worrying about is my money safe or if the Euro is going to crash.

Going offshore to foreign entities may appear all well and good - just for the extra interest points, forget it - but at the end of the day, can you sleep well at night knowing some foreign owned bank or institution can go tits up, change its name or leave you with zero money in your account without warning.

For anyone spreading around their cash into different currencies or thinking about hedging the euro - can you be sure you will always be right investing in Sterling, Dollars or Swiss Francs or one of the Asian currencies?

Reading the thread it reminds me of folks that sell up and move to Spain or Greece or some other foreign country because it is supposedly cheaper. And in the end everyone knows or has read what can happen.

Putting money offshore or in other currencies has it risks - if you think you know what you are doing and don't mind the risks and you can sleep well at night - then go for it. 

IMO, low interest accounts in a bank that has been around since the dark ages, has its purpose ... think about it - and they will likely still be there when you are long gone. 

For what its worth


----------



## kdoc

penury. I understand where you are coming from. And I believe (without having any figures to support it) that most personal depositors behave in a similar way. But one point worth making is that those who do put their money off-shore do so in the belief that it's going to be secure, not for higher interest rates. In many cases interest rates are lower elsewhere.


----------



## penury

I wonder how many people in those foreign countries think the same way about banking outside of the country that they live in.

I'm not sure offshore is safer or that getting a small amount of interest is always better

IMO, I like to keep my money where I know I can get it quickly - and I'll agree - safer is better


----------



## ajapale

cashier said:


> What is your agenda here OP?





Jim2007 said:


> Having gone back and review all the posts by the OP..



The OP is Baba O'Riley (4 posts). What is to be gained by challenging the OP's agenda?

aj
mod


----------



## ajapale

OK, topic reminder: Is this a sensible strategy: deposits with EBS, PTSB, KBC & UB?

aj
http://www.askaboutmoney.com/showthread.php?t=168698


----------



## celebtastic

kdoc said:


> But one point worth making is that those who do put their money off-shore do so in the belief that it's going to be secure, not for higher interest rates. In many cases interest rates are lower elsewhere.


 
... but their money is far less secure than it would be if it was kept offshore.

Well worth reading Brendan's advice on how to protect your savings from the increasingly likely chance of a eurozone breakup:

*Key Post:* Protecting your savings against a euro breakup


----------



## kdoc

celebtastic said:


> ... but their money is far less secure than it would be if it was kept offshore.
> 
> Well worth reading Brendan's advice on how to protect your savings from the increasingly likely chance of a eurozone breakup:
> 
> *Key Post:* Protecting your savings against a euro breakup



celeb, Brendan also wrote this:

"This is a very clear explanation of why people are moving their deposits to Germany.

To my surprise, I have heard that one of the major foreign banks have issued research to their clients suggesting that the punt nua would rise in relation to the German euro. I don't understand this, but there is a risk that this will happen, so moving deposits to Germany is not risk-free, as I had thought. 

I remember when we broke the link with sterling - was it 1981? - the punt was expected to devalue and actually rose in value against sterling."


----------



## yenom

Penury, No one believes they have the perfect option so they are spreading their risk.
If you just moved to Europe I don’t believe you would put money in an Irish,Spanish, Greek or Portuguese bank.
I don’t think it is a good enough reason to put all your money in an Irish bank just because you are near to your money. They have big doors that close too.


----------



## celebtastic

yenom said:


> I don’t think it is a good enough reason to put all your money in an Irish bank just because you are near to your money. They have big doors that close too.


 

Very true.

And if / when Ireland gets ejected from the euro, those doors will slam very quickly too.


----------



## callybags

celebtastic said:


> Very true.
> 
> And if / when Ireland gets ejected from the euro, those doors will slam very quickly too.


 
This to me is a very sweeping, and frankly dangerous statement with nothing to back it up.

As other posters have said, it smacks of someone with an ulterior motive or agenda and any advice given should be taken with a large pinch of salt.


----------



## celebtastic

No ulterior motive here.  An aggressive attack like that is quite unnecessary.

Simply dont want to see Irish people losing their savings in the event that Ireland is ejected from the euro.

Fully in line with Brendan's excellent post on protecting your savings in the event of a euro breakup:
http://www.askaboutmoney.com/showthread.php?t=163133


----------



## callybags

Brendan's post is indeed very good and *informative. *He does not recommend any particular option or give a view on what is the most likely outcome of any particular scenario.

You are advocating a course of action and making predictions without any reasoning or back up.


----------



## kdoc

And celeb chose not to respond to Brendan's other 'excellent' points that moving deposits to Germany is not risk free and when we broke the link with Sterling the punt rose in value against that currency.


----------



## celebtastic

callybags said:


> Brendan's post is indeed very good and *informative. *He does not recommend any particular option or give a view on what is the most likely outcome of any particular scenario.
> 
> You are advocating a course of action and making predictions without any reasoning or back up.


 

Wow ! I really had expected a less emotional and more informed response than that.

Let me turn the question back on you: how should Irish investors protect themselves against the very real prospect of a euro breakup? Should we just sit back and hope for the best, and risk losing everything?


----------



## celebtastic

kdoc said:


> And celeb chose not to respond to Brendan's other 'excellent' points that moving deposits to Germany is not risk free and when we broke the link with Sterling the punt rose in value against that currency.


 
Why all these ad hominem attacks? They really are all out today!

Nothing is risk free. If you want a low risk option, holding euros in cash, rather than keeping them in an Irish bank is probably the way to go.



kdoc said:


> ..when we broke the link with Sterling the punt rose in value against that currency, *for a few days and then fell back to a range of 75p to 90p for most of the 80s and 90s resulting in Irish deposit holders losing approximately 20% of their life savings*.


 
Corrected that for you.


----------



## 8611

Celeb it seems to me that you are advocating putting your money in euro accounts abroad.

It seems to me that this simply avoids the risk of Irish / EU banks going under AND their respective govts and the EU not guaranteeing their deposits, or at least being able to honour the guarantee.

Having the money in foreign accounts denominated in euro DOES NOT seem to protect you from a euro collapse / devaluation. If this happens your deposits will take a similar hammering in their equivalent value whether they are in a bank inside or outside the eurozone.

You might protect yourself from the funds being mandatorily converted to punt nuas, but that prospect seems remote and further down the line at the moment anyway.

But if the euro itself goes under you mightn't be in a great spot with a foreign euro account, particularly if same isn't guaranteed by the EU or an EU govt.

Incidently, can anyone tell me if there is any prospect that countries like Greece, Portugal, Spain and Italy leaving the Euro would strengthen its value? As in, would it become a stronger currency if only held by countries with strong economies and balanced budgets? Or is it a simple corolary of those countries leaving that they would default on massive debts owed to the EU / ECB / banks in those countries?


----------



## celebtastic

Personally, I wouldn't feel comfortable keeping much money in the euro at all. If the euro collapses, there is no way of knowing which currency your savings would convert to.

I live in England, but my Irish friends and family (those few with savings!) have been keeping their money offshore in a range of foreign currency accounts, including the euro, to reduce risk of being exposed too heavily to open specific currency.

It seems a lot easier to open an account offshore, than to open one in Germany.

List of best-buy offshore accounts here:
http://moneyfacts.co.uk/compare/offshore/best-sellers-savings/

Most of these, you can open on-line or through the post.

Avoid the Irish and Spanish owned operations.


----------



## celebtastic

8611 said:


> ...
> Incidently, can anyone tell me if there is any prospect that countries like Greece, Portugal, Spain and Italy leaving the Euro would strengthen its value? ..


 
That is a possbility, but it really depends on the strength of the firewall that the ECB and others can put in place to stop the euro dismantling completely.

What countries do you see left within this strong euro? I don't think Merkel would be too welcoming to the Dutch or the French anymore.

In reality, once Greece or another country is forced out, the irrevocable monetary union will be shown to be a falsehood and the whole euro will eventually disintegrate. Currencies like an punt nua will sink like a stone.


----------



## Chris

Good point celebtastic, but I think that Greece leaving the Euro would extend the life of the Euro a little bit and certainly boost its value in the medium term. I would also extend your comment about avoiding the Euro altogether by saying that people should avoid fiat currencies as much as possible.
All fiat currencies have been plummeting; a good analogy I heard a while back is that world currencies are like a group of sky divers who look at each other and say we're not falling it's just really windy out here. Comparing currencies to other currencies simply reveals fluctuations, but compare them to hard assets and you see the real picture


----------

