Saturday, Dec 02, 2006

The Dollar has sneezed, will the pound catch a cold ?

The Independant: The $2 question: Weak dollar is good for visitors to US, but outlook for world economy is bleak

Transatlantic travellers hoping to cash in on a $2 pound for the first time in 14 years should enjoy the good times while they last, because a tumbling dollar could start an economic whirlwind.

Posted by bryan @ 06:55 PM (441 views)
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11 Comments

1. indiablue19 said...

It does indeed appear that China is pulling up the drawbridge and the USA banking system is clearly being left out in the cold. Repercussions have been immediate and quite horrifying from where I sit. Still a banking customer there with Chase Manhattan/JP Morgan, I discovered today that ATM cash transactions made abroad have been adjusted overnight to include an extreme cash penality called an "exchange rate adjustment," apparently to whatever extent they deem necessary. This amounts to a carte-blanc cash grab by Chase as it openly forages on its customers bank balances in broad daylight. I have checked online and found my accounts already 100 lighter than they were a few days ago. When I called customer service to enquire they said this was authorized through an internal memo on November 2nd, authorizing them to take upwards of 3% additional on any ATM transactions abroad, depending on the currency involved, with sterling the worst of all. There has, however, been no notice at all to account holders at Chase. Along with this, they have also assessed a "Bill Payment Fee" on every account held, in case one makes bill payments online. You can have this service fee cancelled, but they back-dated the fee for three months which is unrefundable. As this can't possibly be countenanced by the banking commission in the States, so I am assuming that Chase is on the verge of ruin and taking advantage of last minute piracy to gather any resources it can from consumers before it tells stockholders they are running in the red. This is indeed extremely serious.

Sunday, December 3, 2006 12:11AM Report Comment
 

2. indiablue19 said...

Oh, a further note. As the internal memo at Chase went out to employees on November 2nd, they obviously new in advance about the impending devaluation of the dollar internationally and wanted to get their hands on all they could in anticipation of the monumental losses they must now be realising. As mentioned, this was all done in absolute stealth with no notice to consumers. HPC friends take careful notice of how banks are permitted to pilfer in dire circumstances! They will not be the losers! Be prepared as the wave is headed this direction.

Sunday, December 3, 2006 12:14AM Report Comment
 

3. paul said...

Can't you walk your account elsewhere? Or do it on next returning to the US?

That's the first thing I did from Cahoot when they were slow to up their savings rate after the recent rate rise. They emailed me to ask why so I replied simply "You snooze, you lose".

Sunday, December 3, 2006 12:36AM Report Comment
 

4. indiablue19 said...

Paul...
Yes, that's the definite priority, and I have done it, but unfortunately closed the door after the horse left the barn, not realising that Chase is apparently either so weak or so larcenous, or both. Fortunately I have a relationship with Federal Trust Bank as co-signatory on a relative's accounts and they are setting something up for me. Another option is to open a dollar account here. Already have pounds and euros, why not dollars? Even so, it's shocking they can just dip in and take what they want! How many more will think of it? And isn't it just interesting that Chase knew the downward turn in currency was imminent on November 2nd to alert their managers, but has yet to tell customers what has happened?

This is especially frightening in view of the wide-open door just left for American banks to play funny with the books by the anti-terrorist department, US Homeland Security, who has announced that Al Qaeda is likely to be sabotaging online banking throughout the month of December with unknown targets and consequences. You can't blame Chase I suppose if "Al Qaeda" has robbed your account.

Sunday, December 3, 2006 01:03AM Report Comment
 

5. harold said...

Although the to $ ratio is reaching record levels, the Indy paints far too rosy a picture regarding the positive effects this will have on the UK. They claim that this will lower inflation in the UK. Were the UK to import large amounts of goods from the US this might be true, but we don't - so no benefit there. In fact we export far more to the US than we import, so the net effect will be detrimental as US orders dry up. The pound maybe making gains against the dollar, but it is not performing spectacularly against other currencies. Their conclusion that the low $ will ease pressure UK rates is similarly misguided.

The FX markets have an interesting week ahead.

Sunday, December 3, 2006 09:53AM Report Comment
 

6. paul said...

Yes india, banks are a form of legally sanctioned robbery.

If you are indebted to a bank and they go bankrupt, they're allowed to sell your debt. If you have savings with the bank and they go bankrupt, you're only able to recover a limited amount.

In other words, members of the public always lose with banks, and banks always win against the public.

Anyway. If there is any such thing as the Financial Services Authority in the US, are they worth asking about this? In my experience, banks get a lot of people threatening to "contact the FSA over this scandal", however when they know they really are in the wrong, they will usually correct the issue when you threaten to contact the FSA.

Sunday, December 3, 2006 12:01PM Report Comment
 

7. japanese uncle said...

This is why China was invited to the recent Builder oops BilderXXXg Meeting. No surprise must be the principle to the bankers of the world.

Sunday, December 3, 2006 01:02PM Report Comment
 

8. Tangara said...

The rising pound or Euro are no surprise... My banker told me 9 month ago that they were playing the Euro at 1.35 US$ by the end of the year.

We are now at 1.32, so still not there.

tangara

Sunday, December 3, 2006 01:35PM Report Comment
 

9. indiablue19 said...

Paul...

You are certainly right, many threaten and then do nothing. Although it won't be so simply from a distance, I do intend to make complaints in every way possible, including to the banking commissioners. But, as JU says, they've known this was coming and even invited China to the last Conference of Demons to discuss when and how fast they would be pulling the rug from under the USA, who must be sweating bullets by now.

This is probably only the "tip of the iceberg" for what will be happening to all of us as conditions tighten on currency. I think that the UK may be more complacent for the present, thinking the currency here is only appreciating, and other developments may come as a shock. So I would warn HPCers to remain vigilant. Maybe gold IS the answer. At least they'll have to break into your locked safe to get at it.

By the way, when I took cash this week I checked the cost of each transaction online and the normal amounts were taken. So they have retroacatively ADJUSTED the transactions, making them look as though they were the original amounts, and all of this additional cash was taken after the fact through some programme their IT department devised for the purpose. Therefore, I assume banks can do this to transactions over any number of past transactions and empty accounts retrospectively for some trumped-up reason based on an internal memoradum, however if they see fit.

Sunday, December 3, 2006 02:04PM Report Comment
 

10. indiablue19 said...

Footnote:

So far, I have noticed the Federal Deposit Insurance Corporation, demanding an inquiry into banking irregularities at Chase Manhattan. I've noticed Chase online of my action against them. I've also posted complaints/warnings on several US consumer websites about them and contacted a consumer advocate who specialises in actions against them at no cost to the consumer. There are several active lawsuits against Chase and related website where I will also weigh in with this information.

Sunday, December 3, 2006 03:09PM Report Comment
 

11. indiablue19 said...

Last footnote:

For anyone having an issue with an American bank and aberrant policies or charges, the organization with the best track record of investigating such matters and making the Banks behave is apparently The Comptroller of the Currency Administrator of National Banks, who is receiving my complaint complete with bank statements and exhibits.

Sunday, December 3, 2006 11:12PM Report Comment
 

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