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Iceland Krone Meltdown.
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VITO_3
Posts: 11 Forumite
Having lost 25% of its value this year of which 17.5% was lost in this month do you think extreme caution should be given to investing in Icesave,Kaupthing Edge etc ?
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Comments
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You'll find lots of comments regarding this on previous posts. If you enter your keyword in the search box and select forums, you'll find lots of posts.0
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I think youll find the dollar having lost a similar amount to the euro and the pound having lost about 14% to the euro.
The pound and the dollar have also weakened to the yen, australian dollar and the chinese yuan.
Perhaps you better go and spend it all on shotguns, beans and a fallout shelter before the end of the world happens.
Lots of lies being spread about banks at the moment dont you know, all based semi facts leading to illogical conclusions. I have money with Landsbankis ICESAVE a very large and very international bank. I would be happy holding up to 35K at any bank that comes under the governments guarentees. You dont earn interest, keeping it under the matress and if a burglar takes it you dont get it back.0 -
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home_alone wrote: »Is this the routine for first posts just come in and scare monger.
gary
I agree - everywhere I seem to look there is a lot of negativity. I invested with Icesave and have no concerns whatsoever - life is too short.Mortgage when started October 2011 : £94,134
Total mortgage balance Mar 2016 [STRIKE]£78,417[/STRIKE] [STRIKE]£77,523[/STRIKE] [STRIKE]£76,181[/STRIKE] £72,001
Offset Saver account Mar 2016 [STRIKE]£45,238[/STRIKE] [STRIKE]£45,666[/STRIKE] [STRIKE]£47,593[/STRIKE] £52,093
Mortgage paying interest on Mar 2016 [STRIKE]£33,179[/STRIKE] [STRIKE]£31,859[/STRIKE] [STRIKE]£28,588[/STRIKE] £19,9070 -
home_alone wrote: »Is this the routine for first posts just come in and scare monger.
gary
I am not a scare monger,I just wonder if sometimes greed comes before common sense.0 -
"sometimes greed comes before common sense"
I think I prefer scare-mongering to holier-than-thou rubbish.0 -
Grr, I posted a long post to this then lost it.
The essentials were as follows:
- There are a lot of new sign-ups recently whose first post is to express concern about Icelandic banks, thus lending the impression of attempts at scaremongering
- Landsbanki's financial situation is very strong compared to many banks, especially in terms of the percentage of loans which are backed by deposits held, which is much higher than many UK banks (link = http://www.icesave.co.uk/financial-strength.html)
- This means that its CDS rate actually holds relatively little importance since borrowings make up a smaller proportion of Landsbanki's liquidity than several other banks
- Kaupthing recently announced it is already funded for the next 12 months and has even borrowed further funds at a rate well below its stated CDS rate, thereby further underlining the point that CDS rates are only one part of a much bigger story (story = http://www.ft.com/cms/s/0/6fc4fdd4-ea2b-11dc-b3c9-0000779fd2ac.html)
- Icelandic banks are not just about the krone, these are multinational banks
- Regardless of the fate of the Icelandic banks, your money is still protected 100% up to £35,000, however this is made up, and so many Brits have saved with Icelandic banks (150,000 according to the article linked below = £5bn of British money) that I expect there would be an absolute outcry were the government not to support savers.
I'm very happy holding my savings with Icesave and I'm frankly getting a bit tired of all the first time posts on here attempting to scaremonger. That may not be OP's intent but scanning these boards will show several threads just like this, full of panic-spreading and devoid of any true or unbiased facts.0 -
Having lost 25% of its value this year of which 17.5% was lost in this month do you think extreme caution should be given to investing in Icesave,Kaupthing Edge etc ?
Being as iceland is the richest country in the world on a per capita basis, has an economy which is robust to the point of overheating, and intrest rates that would make you're hair curl. A fall in the price of the krona is a good thing. It will enable them to be more competetive, on exporting their (limited) goods and extensive financial services.
Course it will hurt the icelander's themselve a bit on imports too but that's a good thing too.
What i fail to understand, in VITO's post and others is this.
We have banks that are great value, robust, and succesful, in iceland and india ect. They are well capitalised, Liquid, and have little or no exposure to toxic derivatives, and western property markets. Fully supported by their govermrnts, and in ICCicis case now racein away to become as big as any of the so called big five - Iccici market cap £10bn, Hbos market cap £17bn. This makes them in my view as safe as any.
People have been clutching at straws with these banks for months. Posting rubbish like the first post in the hope, i guess of stemming the flow of cash to them, and diverting it back to the 'safety' of the so called UK banks.
Where it should be noted we have already had one bank failure. Where another is rumoured to be on the brink of being bought out prior to another failure.
Where the BoE / FSA had to go all guns blazing to deny liquidity problems in a third, and biggest so far. Who the previous week had issued a bond at 9%!!!!! ie 3% above bank lending rates.
And where the UK government has just gone on a gung ho mission to the rest of the world's banks in a move to buy (not cover) BUY mortgae backed securities of unknown provenance (they could be worth a lot less than banks think they) using TAX PAYERS money!!!0 -
I imagine the original post was prompted by this article:
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/03/23/cckrona123.xml
in todays Telegraph.Stompa0
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