# Risk that Bank guarantee scheme could be cancelled???



## Godfather (22 Feb 2009)

Hi all,

a sentence in this article got me very scared:
http://www.independent.ie/national-news/the-nation-faces-ruin-as-our-tds-squabble-1649050.html

This was the sentence: "A new national government would need some exceptional powers for at least three years to insulate it against the unpopularity of the decisions that have to be made"... Do you think that one of these unpopular decisions could be cancelling the Bank Guarantee Scheme??? In theory, a new government can "correct" the decisions of the previous one...

I am now rushing to a Chemist to get some calming tablets I promise, but please let me know your opinion on which "unpopular decisions" could be made....


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## Brendan Burgess (22 Feb 2009)

*Re: Risk that Bank guarantee scheme could be canceled???*

It is very unlikely to be cancelled. 

However, there is a small risk that the state might go bust and would not be able to honour its guarantees. 

Brendan


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## DavyJones (22 Feb 2009)

*Re: Risk that Bank guarantee scheme could be canceled???*



Brendan said:


> It is very unlikely to be cancelled.
> 
> However, there is a small risk that the state might go bust and would not be able to honour its guarantees.
> 
> Brendan



Wow, what happens if that were to occur?


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## theresa1 (22 Feb 2009)

*Re: Risk that Bank guarantee scheme could be canceled???*

You would have public disorder -it wont be cancelled. Infact unless the situation stabilises it may have to be extended if anything.


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## UptheDeise (22 Feb 2009)

*Re: Risk that Bank guarantee scheme could be canceled???*

The state is already bust Brendan. BTW, where are we getting the money to re-capitalise these failed businesses in the first place? The public pension pot? Oh great, so what the Irish government is doing is robbing Peter to pay Paul. Now that sounds very familiar to me... eh, what's it called again... a PONZI scheme. Oh that's ok then because we all know Ponzi schemes work fine. Asked Mr Madoff.

Right, nothing to see here, please do move along.


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## Afuera (22 Feb 2009)

*Re: Risk that Bank guarantee scheme could be canceled???*



DavyJones said:


> Wow, what happens if that were to occur?


Most likely other Eurozone countries would have to come to the rescue to prevent break up of the EURO. Not exactly the kind of action that makes you welcome with your neighbours.


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## RMCF (22 Feb 2009)

*Re: Risk that Bank guarantee scheme could be canceled???*

Either way I don't want to take the risk, and am currently looking into splitting savings across various institutions, with plenty being in the Northern Rock as this is guaranteed by the UK Gov which, although is a mess too, is probably a lot more safe than the Irish Gov.


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## Joody1 (22 Feb 2009)

*Re: Risk that Bank guarantee scheme could be canceled???*

UK is not very safe as they only guarantee up to £50K for depositors, unemployment is running at 2 million and rising. No where is safe at present for any kind of investments. However is the EU responsible for deposits up to 30,000 Euro. Is this correct.


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## RMCF (22 Feb 2009)

*Re: Risk that Bank guarantee scheme could be canceled???*



Joody1 said:


> UK is not very safe as they only guarantee up to £K unemployment is 2 million and rising.  No where is safe at present however would the EU have to pay depositors want comes under their EU bank guarantees rate what every that is at the moment. or is this incorrect.



Can't make head nor tail of what you are trying to say. Seems to be about 6 sentences in one there.


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## Joody1 (22 Feb 2009)

*Re: Risk that Bank guarantee scheme could be canceled???*



Joody1 said:


> UK is not very safe as they only guarantee up to £50K for depositors, unemployment is running at 2 million and rising.  No where is safe at present for any kind of investments.  However is the EU responsible for deposits up to 30,000 Euro. Is this correct.



Sorry edit it, senior moment there.


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## RMCF (22 Feb 2009)

*Re: Risk that Bank guarantee scheme could be canceled???*



Joody1 said:


> UK is not very safe as they only guarantee up to £50K for depositors, unemployment is running at 2 million and rising. No where is safe at present for any kind of investments. However is the EU responsible for deposits up to 30,000 Euro. Is this correct.



Some points I think about this:

1) OK so the UK is only liable for up to £50k, I agree there. But I think that they are more able, as a country, to honour this than Ireland is to honour up to €100k or more.

And ok there unemployment is rising, but so is Ireland's. Don't see any relevance about unemployment and guarantees.

2) Agree that savings of any kind are risky, anywhere. Its just a matter of trying to minimise your exposure to risk, thats why I would vouch for UK over Ireland at present.

3) By the EU do you mean the ECB? I don;t they are responsible for deposits in member state banks. I am here to be corrected if wrong. I think it is up to each country to guarantee their own citizen's deposits?


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## UptheDeise (22 Feb 2009)

*Re: Risk that Bank guarantee scheme could be canceled???*



Godfather said:


> Hi all,
> 
> a sentence in this article got me very scared:
> http://www.independent.ie/national-news/the-nation-faces-ruin-as-our-tds-squabble-1649050.html
> ...


 

I am absolutely livid with that article on so many levels... as they say in Watereford 'I am fooking fumin boi!'

Where do I begin?

First, I would like to say that it has been political interference with the markets that has caused this. In other words politicians have gotten us into this mess and those politicians will only make matters worst.

I would also like to know who the hell do these 'senior industrial leaders' think they are when they try and cajole the politicans to form a national government? Since when did they get voted in? Is this their corporatism, aka, fascism that they are trying to foist on us?

A national government is a suspension of democracy. And anyway, why do these people or anybody else for that matter think that having more polticians working on this problem will work? If that's the case why don't we elect another 1000 or maybe 10,000?

Then the article didn't or couldn't mention the difficult decisions that have to be made. Why? What cowards are we dealing with here?

What I see now is all the chickens coming home to roost. When that used to happen before we turned a blind eye or buried our heads in the sand. Ah sure we're oirish and that's what we do. 

No more though, as outside investors see the corruption going on and are pulling the plug on us. Frankly I don't blame them. I wouldn't invest in this basket case of a country? Would you?


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## Deise Doll (22 Feb 2009)

*Re: Risk that Bank guarantee scheme could be canceled???*

All Northern Rock deposits guaranteed by UK Govt. Not just 50K

Rabo guarantee 100K and 200K for joint account by Dutch Govt.

As Northern Rock were the 1st in trouble they have been working to sort out their problems longer than the others, this might make them safer, hard to know though.


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## freddie59 (27 Feb 2009)

*Re: Risk that Bank guarantee scheme could be canceled???*



Deise Doll said:


> All Northern Rock deposits guaranteed by UK Govt. Not just 50K
> 
> Rabo guarantee 100K and 200K for joint account by Dutch Govt.
> 
> As Northern Rock were the 1st in trouble they have been working to sort out their problems longer than the others, this might make them safer, hard to know though.


 
We've got the proceeds of our house sale lodged with NIB and are seriously considering a cash safety deposit box. Any thought?


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## z109 (28 Feb 2009)

*Re: Risk that Bank guarantee scheme could be canceled???*



freddie59 said:


> We've got the proceeds of our house sale lodged with NIB and are seriously considering a cash safety deposit box. Any thought?


You are not guaranteed at all then. Good luck trying to find one in Ireland.


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## z109 (28 Feb 2009)

*Re: Risk that Bank guarantee scheme could be canceled???*



RMCF said:


> 3) By the EU do you mean the ECB? I don;t they are responsible for deposits in member state banks. I am here to be corrected if wrong. I think it is up to each country to guarantee their own citizen's deposits?


The ECB is the lender of last resort in the eurozone. My understanding is that this means that if there is a run on deposits, the ECB will come up with funding based on repo's (bank lodging assets in return for cash) to pay depositors.


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## freddie59 (1 Mar 2009)

*Re: Risk that Bank guarantee scheme could be canceled???*



yoganmahew said:


> You are not guaranteed at all then. Good luck trying to find one in Ireland.


 
What do you mean by 'not guaranteed at all'?  BTW we have located a saftey deposit box system (in Ireland).


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## z109 (1 Mar 2009)

*Re: Risk that Bank guarantee scheme could be canceled???*



freddie59 said:


> What do you mean by 'not guaranteed at all'?  BTW we have located a saftey deposit box system (in Ireland).


In the event the safety deposit box company is robbed/goes bust/burns down, how will you get your money back?


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## RMCF (1 Mar 2009)

Would not be much of a security deposit company if they didn't offer insurance.


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## z109 (1 Mar 2009)

Hmmm. And would the insurance company come under the 'too big to fail, too big to save' soubriquet? Where is it based and who is it? Swiss Re, maybe? A company that has seen its share price fall by 60% on losses due to bad assets... AIG perhaps?

My point is that the same risk is extant whatever mechanism you use. Either money is guaranteed in the end by the state or it is not.


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## freddie59 (1 Mar 2009)

yoganmahew said:


> Hmmm. And would the insurance company come under the 'too big to fail, too big to save' soubriquet? Where is it based and who is it? Swiss Re, maybe? A company that has seen its share price fall by 60% on losses due to bad assets... AIG perhaps?
> 
> My point is that the same risk is extant whatever mechanism you use. Either money is guaranteed in the end by the state or it is not.


 
Sheesh!

It's head wrecking.


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## z109 (1 Mar 2009)

freddie59 said:


> Sheesh!
> 
> It's head wrecking.


It certainly is! I've tried to give up worrying about it, but it doesn't work. So now I alternate between "don't care" and "press this button in an emergency". It at least gives me long periods when I don't worry about it!


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