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Str Which Currency, Where ? £gb Safe?


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fantastic mis-spelling.

please tell me it was deliberate? :)

...just a typo !

No , really, feel free to use this spelling.....though there's the risk that people might think you're an idiot. Mis- pronunciation and mis-spelling are just two of the weapons used in the long battle fought by the English speaking peoples against pretention.

Edited by council dweller
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Guest Skint Academic

So for an STR fund that is destined to go on a house in the future it comes down to the following considerations as far as I can tell:

1) Will the price of houses deflate faster than inflation can possibly eat away at the fund?

2) How safe is the fund in the UK banking system?

With the first point, we might get deflation (in which case we're quids in), unacknowledged inflation and a low interest rate, (but then aren't the banks desperate for cash to bump up their reserves again and want to attract savings now?) or hyperinflation (should be able to spot this coming and move cash elsewhere). Timing is also important. I'm thinking that house prices will drop really steeply and then bottom out before inflation really becomes a major problem, so at some point there should be a sweet point at which to buy.

Or alternatively, we might just have wage inflation with house prices staying where they are and dropping in real terms, but with all the personal debt out there, a coming recession, unfettered immigration and competition from other countries, I can't really see wage inflation taking off for a while. Surely wage inflation requires job security? (Anyone remember such a concept?)

Second point. How reliable is this 35K guarantee? Can I spot trouble before the majority do (i.e. before the sheeple start a bank run)? In which case I can move the funds while they are still there. I'll start watching the share prices closely. How much do I split up between different banks and increase my chances of losing some of the fund compared to the risk of losing larger chunks of it? Compare this to the amount of time I have to wait before buying a property.

And add to this the question of how far down prices will drop as I need to know whether it's worthwhile waiting any longer. That's a tough one. I'm going to go for 50% in the highlands.

At least that's my current thinking on it. This thread is helping a lot.

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Take a look at these graphs...

Swiss Franc and Euro:

http://finance.yahoo.com/q/bc?t=1y&s=G...mp;c=GBPEUR%3Dx

Norwegian Krone and Aussie Dollar:

http://finance.yahoo.com/q/bc?t=1y&s=G...mp;c=GBPAUD%3Dx

Japanse Yen and Chinese Yuan:

http://finance.yahoo.com/q/bc?t=1y&s=G...mp;c=GBPCNY%3Dx

IMHO, if you're looking to switch out of the GBP now you *may* have missed the boat. I've done very nicely out of the move and am sitting on enough profit that I'm leaving it that way (I can't see the pound appreciating for a long while). But when folks say Gold and Silver are "overpriced" you should also look at how much other currencies have increased in price against the GBP in the last 6 months.

And of course Gold and Silver are absolutely nowhere near their inflation-adjusted peaks.

BTW, if you're considering Silver, take a look at this video: http://video.google.com/videoplay?docid=3657719902845882974

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As a few others have said, if you ultimately want to use the money in sterling and are not prepared to risk the capital (why would you - that is why you STR) keep it in sterling cash. Putting it another currency means that you no longer have sterling capital protection. It is an asset whose value will vary in sterling terms, rather like shares or a house.

Have a punt with a portion by all means but do not play the currency markets with a serious chunk of the money. If your bet turns out right, you will think yourself very clever, but by and large, no matter how sound your reasoning, you will have as much luck on the toss of a coin. An open, loss making currency position is a scary thing that will take over your life.

By the way, I agree that sterling should lose value against the other major currencies and gain marginally against the dollar. but I would not bet my house on it!

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I just want to know WHICH UK BANK/building society is SAFEST/Least likely to collapse, so that I can find a *home* for my STR pot and not need to worry so much. THANKS ;)

Can someone please post a link? I remember seeing a post which mentioned information on WHERE is safest UK institutions for my savings/STR.

The information was in a list with safest >>>>>>> to not so safe :blink:

The link also had info on interest rates. :rolleyes:

Edited by A:gent W00
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I'd say the main reason for spreading the money throughout a few different currencies isn't so much profit, but just keeping from taking a total wacking if something out of the blue happens.

I would not be surprised to hear at all that the dollar, pound, or euro took a massive dive on any given day.

that being the case, I wouldn't exactly want to have all of my money in one of those currencies.

making increased money from trading currencies would just be a benefit, though a nice one, and to trade soley for that purpose is pretty high risk.

a lot of people have been burned on the Forex markets.

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I just want to know WHICH UK BANK/building society is SAFEST/Least likely to collapse, so that I can find a *home* for my STR pot and not need to worry so much. THANKS ;)

Can someone please post a link? I remember seeing a post which mentioned information on WHERE is safest UK institutions for my savings/STR.

The information was in a list with safest >>>>>>> to not so safe :blink:

The link also had info on interest rates. :rolleyes:

Northern Rock

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Guest Skint Academic

A thought just occurred to me. How likely is it that we will eventually move over to the Euro in the UK? And if we do, would it be better to move a large proportion of an STR fund over to it now? Is Crash Gordon just driving the pound into the ground until we move to the Euro?

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  • 1 year later...

To be honest, I feel the dollar is undervalued and the euro is incredibly overvalued at the moment.

I would want to be in $ rather than in any other currency, possibly even yen. Because the whole world is going to go into meltdown, and the $ is the reserve currency that everyone is going to jump into. It is like when the Titanic goes down and the dollar is the last bit of wood left in the ocean that everyone will want to jump on at once. If the markets go into meltdown again, then sterling should be very badly hit - maybe less so if it is just a continued depression that brings high unemployment but maybe not a stock market crash.

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