Savings in Kaupthing Bank in Iceland Account

meester

Iceland only has $2b of foreign reserves.

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/03/27/cniceland127.xml

Indonesia had ten times that amount of foreign reserves, and its economy and people got utterly trashed, banks went bust, the stock exchange and currency lost 75% of its value.

ianmr65

meester wrote: »

AFAIK means As Far As I Know

The Krone has lost a lot of its value, there is really no right or wrong answer as what to do.

I agree the situation for this particular lady is very worrying, as her account is in Krona. And on that basis advice is difficult to give.

But plucking out statements like.

"The krona is trashed", or there is "no right or wrong answers" are neither helpful, not particulary enlightening.

It's like saying my house has a big hole in the roof. Oh well, se la vie, and watching it all get ruined. Instead of trying to understand why, and what you should do about it.

The question is why has the krona fallen? If it's purely to do with the current account defecit, and overheating in the icelandic economy, then i agree there is no short term solution. They have to batten down the hatches and sit it out. And people holding Kronas have to take a view based on that.

However if it's to do, partially, with speculators, who are betting on the krona, and on institutional default, there is a great deal that can be done, and a reverse will be acheivable in the short term.
So if the belif is that this is the case and iceland can turn it round, holding onto the Krona and watching it rise past previous levels could be prove very lucrative

Iceland has been completely hammered in the past two months. There are underling problems, but you could say the same for any country in the west.
Many respected economists are at a loss to explain it. And the answers keep pointing to speculators.

ianmr65

meester wrote: »

Iceland only has $2b of foreign reserves.

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/03/27/cniceland127.xml

Indonesia had ten times that amount of foreign reserves, and its economy and people got utterly trashed, banks went bust, the stock exchange and currency lost 75% of its value.

The telegraph have been running doom mongering one sided articles, on sundays, about iceland for weeks, it's probably cos Kaupthing won't advertise with them, and they run out of things to write about.

There have been about 10 articles discussing iceland in the FT in the last week. All of them a great deal more balanced, and authoritative. And much of what was lifted to write the telegraph 'article' is put in a great deal less alarmist, and much more even handed way.

And i say again, the scand banks have an agreement to help out. The FT is on side, and the ECB will probably wade in. Or do you think that iceland is going to go to war against the speculators on it's on?

OliverDog_2

Hi Everyone Thanks for you help. I have decided to withdraw £10,000 tomorrow and take a loss on that. I will leave the rest in there and watch the market for a little while. Do you think this is the right thing to do? Are there any signs to watch for which should make me take the rest of my money out quickly? Thanks everyone

ianmr65

Watch the icelandic krona to euro exchange. The dollar and the pound are on the slide, so the euro chart gives a better indication, the lower it goes the worse the krona is doing:

http://www.exchange-rates.org/history/EUR/ISK/G/90

and search the FT, for day by day reaction, and anaysis, and Bloomberg, for pretty much up to the minute major news on iceland, and kaupthing.

www.ft.com, and www.bloomberg.com

You can pretty much ignore what you read in the other UK papers, as they lift most of what they write from these two sources, and spin it, for there own purposes.

Having said this the times has an intresting article specifically relating to the currency drop:

http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article3645430.ece

and a comment from someone in know in rekeyvik:


"Lets not forget that they can cash in another £1/2 billion by changing sides. That is buying Kronur and selling Euros, Franks, Pounds etc. If the Krona will strengthen by some 20 - 30% (as can be expected) their profit will be substantial. Be ready to see that happen in the next few months."

DocProc

Iceland’s Financial Supervisory Authority has begun an official investigation into alleged speculative attacks by international hedge funds on the country’s currency and stock market, according to people close to the probe.

Simultaneously, Kaupthing, one of Iceland’s leading banks, is considering legal action against Bear Stearns, the troubled US bank, for the role it played in a trip to Iceland by a group of hedge funds last January.

More at http://www.ft.com/cms/s/0/10f40df2-fea5-11dc-9e04-000077b07658.html?nclick_check=1

DocProc

I see the Icelandic Krona is now beginning to make a strong recovery.

I found the following really useful tool, which has quick conversion tool and also a graph facility. This latter clearly shows the recovery that has taken place over the last few days:

http://www.travelex.co.uk/Personal/RateTracker.asp

daffodiltulip

Can private individuals open European accounts? If so, how is the interest affected?

debbie42

Probably not a good idea to tag a new question onto an old thread, especially not an Iceland bank thread!