Tuesday, January 27, 2009

Best to know what you’re getting into

No UK safety net for Post Office savers

Apologies to anybody who thinks I'm off topic but I thought that any blog readers who are thinking about putting their precious deposit savings in the Post Office really should know about this.

Posted by quiet guy @ 12:47 AM (1112 views)
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8 thoughts on “Best to know what you’re getting into

  • Thanks LP – I’m sure a lot of readers will appreciate being informed of this!

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  • little professor says:

    This is not new.

    In the past, the British FSCS covered the shortfall between to the two compensation schemes, back when the Irish scheme only covered €20,000 of savings.

    When the Irish scheme guarantee went to €100,000 and then unlimited, it rendered the FSCS coverage redundant.

    Even under the old scheme, customers would have had to apply to the Irish scheme for the first €20,000 and then to the FSCS for the rest up to the £35,000 ceiling. Now with the Irish covering the lot the FSCS does not have a role.
    This has been the case for months, they are merely writing to people now to inform them of that now.

    Having said that, the Irish are bankrupt so I wouldn’t trust their coverage.

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  • Lp i take on board what you say but its politically unfeasable that the Gov would not step in (as with Iceland, although Ireland is more interesting because of the Euro – what happens there, do eg the ECB / other Euro zone members step in? – i doubt if any treaties would cover the bankruptcy of a sovereign state but i have no idea!). The gov will underwrite all deposits if and until they are no longer able to. The ability for them to do that though is contingent on to what extent they “have” to bail out the banking system. its a bit catch 22 either they let the bank go under and then pay all the depositors or drip feed the banks so they dont.

    Of course i have simplified things because if you do let a bank go there is contagion and retail deposits are more likely to be withdrawn across all banks causing a systemic failure.

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  • @drewster

    LP?

    Was that a slip or do you think I’m Little Professors’s sockpuppet?

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  • oops, looks like you are qg

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  • This isn’t off topic.
    All of us who knew we were in a bubble saved hard for the day when it would pop.

    We just didn’t foresee how badly we would be betrayed by the government who rely so desperately on the continuation of property insanity.

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  • Sorry quiet guy, that was a slip of the keyboard.

    The only suspected sock-puppet lately is troy…

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  • troy = malct, right?

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