Funds flee Greece as Germany warns of "fatal" eurozone crisis

[Sysman]

I like the way the article paints a picture of a Greek meltdown and then two paragraphs from the end... "The deeper concern is Spain..."

For a lot of Brits who have invested there, Spain will indeed be a deeper concern.

How many Brits have savings with Santander? (either directly or indirectly)

[AtW]

However, we are still in control of our own currency.

How does that help when it comes to getting foreign investors to buy UK gilts?

Ah wait I know - you can just print GBPs to buy gilts they would not buy, sorteeed!

Euro is a reserve currency now - something that escapes many people, it's completely different status than what they had 10 years ago and what GBP has now.

Those who buy into euro do that to hedge their portfolio against dollar, they will be doing this regardless of what happens in Greece (so long as they can't print euros like UK prints GBP now).

[AtW]

How many Brits have savings with Santander? (either directly or indirectly)

Loads via Abbey etc - good thing that Santander did not get into financing property buys in Spain by foreigners, they preferred foreign banks to take on these risks.

[HairyArsedBloke]

How does that help when it comes to getting foreign investors to buy UK gilts?

Ah wait I know - you can just print GBPs to buy gilts they would not buy, sorteeed!

Euro is a reserve currency now - something that escapes many people, it's completely different status than what they had 10 years ago and what GBP has now.

Those who buy into euro do that to hedge their portfolio against dollar, they will be doing this regardless of what happens in Greece (so long as they can't print euros like UK prints GBP now).

Actually, GBP is the third highest reserve currency. The thing is that it's still only 4 to 5% of the holdings in foreign currency. The euro is about a quarter and about two thirds is USD. I can't see this changing much for many, many years.

[Doggy Styles]

How does that help when it comes to getting foreign investors to buy UK gilts?

Ah wait I know - blah blah blah...

Control of interest rates. Control of money supply. Control of... your currency. You can adapt to your individual needs.

Try doing that if you use the euro!

[PM-Junkie]

Control of interest rates. Control of money supply. Control of... your currency. You can adapt to your individual needs.

Try doing that if you use the euro!

DS, do you find the phrase "banging your head against a brick wall" kinda popping in there?

This guy doesn't understand even the basics of economics. Never has done, never will. My compliments to you for your patience though!

[AtW]

Actually, GBP is the third highest reserve currency.

It's second or maybe even third tier currency now - below Japanese yen because latter far more useful in Asia.

The important part is that there is euro vs dollar balancing hedge basket now, others play minor and diminishing role (maybe yuan can buck the trend if China wants it)

[AtW]

Control of interest rates. Control of money supply. Control of... your currency. You can adapt to your individual needs.

So, let me just see here:

1) interest rates are near zero (negative if you take inflation into account)
2) currency is being printed en masse to buy guilts of banks who buy it from Govt

That does not look good to me.

At least euro zone have very different members who may have different performance, but overall their system is much more solid - not least because they now have reserve currency.

[Sysman]

Loads via Abbey etc - good thing that Santander did not get into financing property buys in Spain by foreigners, they preferred foreign banks to take on these risks.

Property isn't the only thing. The state of the Spanish economy isn't going to be good news for them.

[AtW]

The state of the Spanish economy isn't going to be good news for them.

That's why they have expanded abroad and got lots of savers money - now they can buy a lot of stuff on the cheap in Spain (if they want to): buying low is not a bad idea, it's buying on the top of the market that's not good idea.