Why would you want to move your money to Germany, I dont understand?

T

tester1

Registered User
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Ok so I understand the euro may collapse from hearsay/posts etc.
However can someone explain why you would want to move your money to 1. Germany or 2. Spend it as another post suggests?

The way I see it I will still need money for day to day expenses etc so I should keep my savings.
Whatever happens my savings will be converted to our new currency????

Is it simply I would get more money for my savings if I had them in Germany?

Very confusing stuff to the non financial minded?
 
The basic argument is that deposits in Irish banks will get converted into a new Irish currency, while deposits in a German bank will get converted into a new German currency. The Irish currency will devalue significantly and the German currency will appreciate in value.

All speculation. Speculation with some degree of consensus.
 
CiaranT said:
Speculation with some degree of consensus.
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Which is the worrying part in itself. The more people that do it the more likely it is that there will be collaboration to identify account holders with foreign passports.
 
One person's consensus is another person's herd mentality.

Sounds like today's version of 'get on the property ladder before it's too late'.
 
T McGibney said:
One person's consensus is another person's herd mentality.

Sounds like today's version of 'get on the property ladder before it's too late'.
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Hi Tommy

There is undeniably a problem if everyone in Ireland transfers their money to a German bank account.

But it's not correct to compare it with the property ladder which created a housing bubble.

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. If the euro breaks up and the Irish government insists that all Irish residents with German deposits repatriate them and convert them into punt nuas, you will be no worse off.
 
In the context of an Irish sovreign default and/or Euro collapse, is it beyond the bounds of possibility that Germany would choose to confiscate (or impose a ruinous levy) on funds held within their banking system by Irish residents?
 
JustforGroup -

Here's a good reason for moving a porportion of one's savings outside Ireland into a Offshore Savings Account.....

If a person thinks that they may loose their job, then they may need to move into Europe to secure future employment - therefore with this in mind they will need to ensure that they will be able to avail of access to their savings. Now if Ireland defaults or whatever a Punt or whatever is not going to be of any use to somebody in this situation.

So probably the best insurance that one can take in this type of situation is to open and move savings into Offshore Savings Accounts?
 

That's the only and most sensible reason I've read to date for moving some savings offshore.
 
I think Brendan summed it up best and most concise. If you move your money abroad or keep it here and nothing happens, then you have not lost out. If you move your money abroad and the Euro does break up then you benefit. If you keep your money and the euro breaks up you lose out a lot.

T McGibney said:
In the context of an Irish sovreign default and/or Euro collapse, is it beyond the bounds of possibility that Germany would choose to confiscate (or impose a ruinous levy) on funds held within their banking system by Irish residents?
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My dad taught me that desperate politicians will do desperate things, and I would put nothing beyond the realms of possibility when it comes to politicians. However, I believe that there is no precedence in the history of the FRG of asset confiscation of any kind. This was something that was done under the Kaiser and in Nazi Germany, so I would not see this as a particularly popular action.

justforgroup said:
If I had followed the scaremonging from 2 or so years ago, my money would be sitting in some crappy Belgium account 'earning' 1% and I would have lost thousands - literally.
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Two issues with this statement:
1) Interest rates in Germany and Belgium are available at 2%-2.5%
2) You are assuming that the crisis is over and that your money here is safe

The crisis that started in 2007/08 is far from over, you might be better off having kept your money here so far, but that doesn't mean that in the next years that will all be voided.
 
Interesting debate guys -

In today's paper's there's a headline that states another 75,000 people are expected to emigrate from Ireland due to the present economic difficulities here. I personally think its prudent for most people to have at least a portion of their savings abroad and accessible in case its needed if they find themselves having to emigrate also. A Punt Nua or whatever would be of no use to somebody who finds themselves in this situation. But there's no doubt that our continued large scale emigration of our working population will also contribute to the ongoing Deposit flight.

And while something like this on a large scale is not going to do any favours to Ireland's Banks Deposit/Capital Base what choice do people have?
 
Folks

Tester asked a simple question.

The primary purpose of askaboutmoney is to answer such simple questions.

If you want to debate other issues, do so in a separate thread.

I have deleted all off topic and abusive posts.

This is a sensitive subject - but you should be able to discuss it without abusing each other and creating work for the moderators.

If someone is abusive or off-topic, please don't respond to it publicly. Use the Report Post facility and the moderators will deal with it.

Brendan
 

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.

Brendan
 
Brendan Burgess said:
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.

Brendan
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Hi Brendan

We broke the link with Sterling in 1979. Jack Lynch was Taoiseach. I was only a child at the time so forgive any memory lapses but I recall that the punt did devalue by 20%-odd against Sterling and that the cost of imports shot up correspondingly very quickly.
 

Hi Tommy, I went into a British bank with Irish punts a few days after and the punt was worth more than sterling. It was short lived, but the punt did rise.
 
Troy McClure said:
Brenadan do you have any more info on that? Do you have a link?
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I don't. I am trying to get more information, but at this stage, it is important to note that it is possible. I would have thought unlikely but it is important to realise that you can't avoid risk completely and economists are very bad at forecasting.
 
Brendan Burgess said:
Hi Tommy, I went into a British bank with Irish punts a few days after and the punt was worth more than sterling. It was short lived, but the punt did rise.
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It must have been very short-lived Brendan. It took until the 1992/93 currency crisis for the punt to again reach parity with sterling. That was also short-lived.
 
Troy McClure said:
Brenadan do you have any more info on that? Do you have a link?
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Hi Troy

I have found a reference to it here.

The research paper was done by [broken link removed]


I don't understand it. Is it something to do with our very strong exports creating a demand for Irish currency?

I think people would be very demoralised if they moved their money to a French bank account only to find the punt nua rising against the Franc.
 
Didnt the euro rise against sterling too? And stay there. Wasnt the value of the euru to sterling around 70c to a £ in 2002?
 
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