# Moving my money



## lurker (11 Feb 2009)

I'm in quite an enviable position where I owe nothing to anyone (mortgage paid, kids independent etc).

We have always banked with Leics Alliance and they have been OK. but now our meagre savings are earning pipper all and i suspect they will go down the pan customer relations wise now they are part of a much bigger group.

I'm thinking of putting the lot in a local building society more to remove it from the clutches of the multinationals. Hopefully there will be a slight interest improvement too, and I'd like to think my money is helping local people to get a mortgage, rather than someone in Spain.

I'm also attracted towards the Co-Op for their ethical stance ( I'm not a tree hugger but ........). Are the Co-Op all that are cracked up to be.


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## misterfish (11 Feb 2009)

Co-op have always had a good reputation.

The ethical approach is quite laudable but you need to consider the value of your savings and the interest rate. If the interest you are receiving after the deduction of tax is lower than the rate of inflation then rather than savings you are getting losings.

SWMBO and I always look at http://www.moneysavingexpert.com as the site gives a lot of useful and dispassionate advice.

Local Building Societies can offer very good savings products but you do need to keep an eye on what is happening. We find that with internet enabled accounts we are kept up to date with interest rates but our postal mini cash ISAs had the rate plummet from one of the highest to one of the lowest without any notification - we had to search to find the current state of play.

The other thing to consider is a fixed rate bond where you effectively tie up cash for an agreed period (typically 1, 2 or 3 years) - you can get much better rates doing this.

The only way to decide what is best for you is to spend time on the web getting information and then acting on your decision.

Just remember to keep your wits about you and read ALL the info - it's amazing what is in the small print.

Misterfish


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## wizer (11 Feb 2009)

Put it all on the lottery :twisted:


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## chiba (11 Feb 2009)

Option : buy gold (as a solid metal)? The governments are all printing money, so your savings could well be inflated away...


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## gardenshed (11 Feb 2009)

Had money in the CO-OP for years, good bank, good service, decent interest rates. What more can I say   . They do an online service too.
which is very good.


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## Geno (11 Feb 2009)

As it turns out for some, it would have been better for investors to have had it under the mattress than in shares!

The unfortunate thing at the mo for anyone coming out of bonds etc is that they will find interest rates for new bonds slashed. Banks aren't even offering decent rates for long terms as they really don't know whats going to happen. It may be necessary to shift it along on a more regular basis to optimise earnings. 

Gold wouldn't be the best option anymore since its towards the top end of its purchase price. Yes it is one to invest in as it holds and increases its value but again it will depend on how long you want to put these funds away for.

Its a bit of a mine field at the mo cos of all the uncertainty. Banks certainly won't be doing you any favours, unless its a bucket load of dough you've got!

Just make sure you read the fine print as they say, the banks are adding all the backups and protection they can and even when they are saying its capital protected its not always the case - on top of that, even if its capital protected, the bank ur placing it in may not be as secure as you believe! Scary stuff at the mo and more interesting times ahead!


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## p111dom (11 Feb 2009)

chiba":1betyyhx said:


> Option : buy gold (as a solid metal)? The governments are all printing money, so your savings could well be inflated away...



Thats actually a pretty good idea. I have a friend that has been doing this for the last year, buying gold sovereigns from a dealer in Blackpool. There's a pretty hefty 12% charge for the conversion but it's a much better bet than Sterling at the moment.


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## wizer (11 Feb 2009)

I wonder if Bricks and Mortar is a good investment at the moment? Surely the prices will rise again? and in the recession, people are renting. Win/Win?


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## BradNaylor (11 Feb 2009)

lurker":37714wyq said:


> Are the Co-Op all that are cracked up to be.



I bank with the Co-op and find their service excellent, particularly the online banking. Just as importantly for me, I like their ethical stance and the fact that they are a mutual organisation acting in the interests of their members rather than chasing profits for their shareholders.

If all our banks had been run on these lines the world wouldn't be in the financial mess it now is.

I would love to see everyone moving their banking business to the Co-op or to the remaining mutual building societies.

If I had a sum of money to invest right now though, I'd stick it in Premium Bonds. The interest rate is no worse than the bank (i.e 0%) but there is a good chance of a few tax-free wins. 

Property? Don't make me laugh! House prices will be falling for another 2 or 3 years yet, until they are around half their value in 2007.

They won't regain their 2007 values for 10 -15 years

Cheers
Dan


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## Blister (11 Feb 2009)

lurker":3doxhvzv said:


> I'm in quite an enviable position where I owe nothing to anyone (mortgage paid, kids independent etc).
> 
> We have always banked with Leics Alliance and they have been OK. but now our meagre savings are earning pipper all and i suspect they will go down the pan customer relations wise now they are part of a much bigger group.
> 
> ...



Need any tools :wink: 

you may just be lucky :mrgreen: :mrgreen: :mrgreen: 

only joking 

put it somewhere 100% safe or it may go the way lots of other peoples have gone :roll:


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## Karl (11 Feb 2009)

Depends how much cash you've got. 

Despite DT's pesimistic view on property prices (he's been spending too much time with that House Price Crash lot :lol: ) I personally think that the end of this year would be a good time to invest in SMALL properties. You have to do some serious homework though and buy the right property in the right area at the right price.

Cheers

Karl


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## devonwoody (11 Feb 2009)

How about buying bankrupt stock and selling on Ebay. 

My daughters see a sale item advertise it then go and buy to honour orders. 

You might become another Sir Alan Sugar.

(In fact I recall some of the radios didnt have anything inside the case) :wink:


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## BradNaylor (11 Feb 2009)

karl":1krh9bat said:


> Depends how much cash you've got.
> 
> Despite DT's pesimistic view on property prices (he's been spending too much time with that House Price Crash lot :lol: ) I personally think that the end of this year would be a good time to invest in SMALL properties. You have to do some serious homework though and buy the right property in the right area at the right price.
> 
> ...



Nowt pessimistic about it, Karl.

Falling house prices are a _good_ thing!

The sooner the average house goes back to being worth 3 times the average wage the better. Restricted bank lending should keep it there too.

Then maybe my kids (and yours) will be able to buy a house at a realistic price when the time comes.

Houses are for living in, they should not be investment vehicles. The housing bubble of the last 25 years (with a brief hiccup in the early '90s) has had a horribly corrosive impact on society in general.

Hopefully it won't happen again in our lifetimes.


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## ike (11 Feb 2009)

> Houses are for living in, they should not be investment vehicles. The housing bubble of the last 25 years (with a brief hiccup in the early '90s) has had a horribly corrosive impact on society in general.



Truer words never spoken.


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## Jenx (11 Feb 2009)

Dan Tovey":2xqws4ml said:


> Property? Don't make me laugh! House prices will be falling for another 2 or 3 years yet, until they are around half their value in 2007.
> 
> They won't regain their 2007 values for 10 -15 years
> 
> ...




Serious question - Dan, do you reckon this is the way it'll be ?

I ask, because having been sat in my curent house for 16 years, the mortgage isn't big.. and I'm considering making what could be a 'final move' to try and make the best of the current slump in the market's prices.
To try and make the most of it - I guess you could say 'timing is critical' , relatively speaking of course.
I too get the feeling that we're perhaps some way from seeing the 'bottoming out' in the housing market.
I understand that differing areas around the country will have their own little quirks and be slightly different from the next... but the 'general trends' will likely as not be fairly similar.

I think that I may be a wee bit too early to make a move on the idea yet, and the prices will continue to go down, perhaps quite considerably for maybe a good year or so.

I'm going on 'gut feel'.. as I'm out of my original trade as a Plumbing and Heating Engineer, and have been for a few years.. and no longer have maybe quite the finger on the pulse as perhaps I once did.
-- You are perhaps more 'in tune' and have a better insight..... so am interested to get your ( and anyone else's of course ) thoughts.

Just for info - where I am, an 'average' 3 bed house, detached, by a wimpey or a barratt or a scotia homes had up until the start of the slump, been going for around £240 K
My mate just sold his 'new' one which cost him that a year ago.. and he got £212K for it  ( ouch ! )

Ta ! 

Alun


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## Gower (11 Feb 2009)

I'm giving Premium Bonds ago. Can't do much worse than the paltry interest I'm getting at the moment. Regarding house prices, I agree 100% with Dan. Hope they remain at a reasonable level for my kids & grand kids sake. I'm sure someone makes a killing when the prices are ridiculous but it's not Joe Average.

Cheers,
Jim


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## devonwoody (12 Feb 2009)

Didnt the government say they needed to build another 3 million homes only a few months ago, so there is going to be a shortage down the line somewhere.
If things are in short supply prices usually go up.
No deflation around IMO, cars went up 5% last month, new freezer also went up 5% last month.


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## BradNaylor (12 Feb 2009)

Jenx":mnn0fj8m said:


> Dan Tovey":mnn0fj8m said:
> 
> 
> > Property? Don't make me laugh! House prices will be falling for another 2 or 3 years yet, until they are around half their value in 2007.
> ...



My thoughts on this are quite simple Alun.

Over the long term, there has to be some kind of linkage between earnings and house prices. If house prices become too far detatched from earnings, then sooner or later people will not be able to afford to enter the market.

This linkage is not a fast and constant one. The laws of supply and demand play the major role in setting prices at any particular point in time. Factors which affect the demand for housing include interest rates, the availability of mortgages from banks, and the sentiment of the population as regards where prices are heading.

The supply of housing is fairly static, although there are currently a huge number of unwanted new-build flats in all our cities.

The demand for houses has reached bubble-like proportions in the last few years due to a 'perfect storm' of a combination of the facctors listed above, the main one being the total abandonment by the banks of the prudent lending policies they had established over centuries.

It is difficult to see how the banks are going to be allowed to be so stupid and greedy again in the forseeable future. They have damn near bankrupted the world.

Without idiocies such as 125% mortgages and loans of 5, 6, or 7 times someone's earnings it will be literally impossible for house prices to rise in the way they did in the recent past.

he long term linkage between prices and earnings wil be restored.

In the short term I see prices overshooting on the way down to below their long term average in relation to wages.

Average 3-bed house - £80k

We too, have been contemplating that 'final move'.

We have abandoned the idea however, in favour of building an extension with a very cheap extra bit on the mortgage.

Cheers
Dan


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## devonwoody (12 Feb 2009)

Well in the 50's they didnt take wifes earning into account when setting a mortgage, now they do, if I tell the banks to take into acounts childrens earnings do you think they would take that one up. 

What will put the prices up again is that thing called inflation, do you think there will never be inflation again?

Of course there will, that is the way those debts that are around will eventually be paid.


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## BradNaylor (12 Feb 2009)

devonwoody":1ghyc2pj said:


> Well in the 50's they didnt take wifes earning into account when setting a mortgage, now they do, if I tell the banks to take into acounts childrens earnings do you think they would take that one up.
> 
> What will put the prices up again is that thing called inflation, do you think there will never be inflation again?
> 
> Of course there will, that is the way those debts that are around will eventually be paid.



I never said that prices wouldn't go up again; just that they would be more closely linked to earnings.

ie. they would rise in line with inflation.

Dan


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## Jenx (12 Feb 2009)

Thanks Dan ...
I have to say, I agree with you 100%

When I started out married life ( 1985 ), the bank would give me 
3x my wages or 2.5x the combined pay of me & the missus.
to the tune of a 95% Mortgage. - maximum over 25 yrs

We've now heard of 100 year mortgages, for 125% or more of the value &
as you say 7 or more times the annual income,
and people buying property between 4 or more individuals.
-- Absolute lunacy, and the main reason we have stayed put for so long.

Seems to me that the economy in recent years has been entirely based on credit, large debt and borrowing that was difficult if not impossible to sustain in the medium to longer term.

We only have to look at the TV, -- we have television advertising now, almost _encouraging_ people to go down the route of IVA's and other insolvency agreements etc ... it almost borders on encouraging people to get into real financial difficulties, and not to worry a toss about doing so, because there's an easy "escape-route"... the TV says so ! 
This to me seems utterly irresponsible.. but I'm not sure on who's part this irresponsibility is ? Government ? Financial Services Industry ? perhaps a bit of both.. and a few more besides.

I'm not a particularly political animal, but it seems to me that we have oscillated between the "right" ... who's very name 'conservative' is derived from the verb 'to conserve' or in other words, to 'save', and the left, who have had perhaps much more of a tendency to throw caution to the wind.
Neither appears to "work", and after years of one, we almost need to then endure years of the other just to maintain a 'swinging pendulum' of what we perhaps recognise as the boom-to-bust and back to boom economy that the country has experienced certainly in my lifetime ( I'm 44 ), and I would guess well beyond.
Depending on when an individual arrives on this earth during this cyclical swapping from right to left, gives rise to how that individual's life will unfold and how easy or otherwise he/she will find it to provide himself with a nice place to live for him and his family, once that all arrives.

We've allowed ourselves to become a culture of greed, of irresponsible risk-taking, of 'have it now and worry about how to fund it, tomorrow'

Perhaps there _is_ no other way... perhaps we _have_ to exist in this cycle of boom & bust.. I'm not sure. 
It doesn't appear to work, in the long term though.

Will we 'learn' from this latest chaos ? One would hope so.. but cynicism does make me doubt that in the 'long term' ( 20+ years lets say ), we'll avoid finding ourselves in a similar type of situation. Perhaps not the best legacy to leave our kids or grandkids..
But lets hope not.

You've given me some food for thought there.. an extension ! 
that may well be a very viable route to go down for us too....
Cheers ! 

[/i]


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## devonwoody (12 Feb 2009)

Yes but the last 50 years as seen terrific prosperity compared to my grandfathers days from the 1890's to the 1950's.

So is that bad?

He would be in the workshouse today.


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## Karl (12 Feb 2009)

I know it is off-topic, but I think the single biggest thing that could be done to bring house prices back in line is to outlaw Interest Only mortgages. They give a false perspective of the type of property which one can own and, when taken in conjunction with the high multiples offered by most lenders, have contributed significantly to ever increasing price rises. IMHO.

Cheers

Karl


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## Jenx (12 Feb 2009)

devonwoody":3iakypnn said:


> Yes but the last 50 years as seen terrific prosperity compared to my grandfathers days from the 1890's to the 1950's.
> 
> So is that bad?
> 
> He would be in the workshouse today.



You have point there too D/W ...  
'Prosperity' is probably something that could never be accused of as being bad.
I don't know.. perhaps its the methodology of whats _driven_ that prosperity thats more in question ?
It'd probably also be true to say that there have been more personal bankruptcy's, more 'falls' from relative security into more desperate circumstances in the last 50 years , than may have been in your father's time ... reflecting the boom & bust mentality, i guess .

I think we're possibly a more 'selfish' society, a more 'greedy' society, and perhaps even a less 'caring' society at this point than maybe we've ever been. .. would there be some substance to that, do you think ?

If we had all the answers, I suppose we wouldn't even be debating the question -- 
I do feel that as a whole, we've collectively taken some bad decisions and have, ( as a big generalisation ) kind of lost our way a little bit.
The issue is so broad ranging, - the way the world operates now isn't fully for the better... everything is ''want it yesterday / call centres in a very far off land / buy it online and no personal touch involved -- which is ok until there's problem with something -- / Huge Multi-national conglomerate-controlled etc " that some of the methods of years past may not look such a bad option now.
I'm not suggesting that we go back to the horse and cart , or preserving our meat in a salty barrel in the shed... but perhaps looking to the past could teach us something for the future, on many levels.

Anyways.. its off to the diabetic clinic in 5 minutes for me ....
now there's something that does work reasonably well... we have good healthcare here ... sure, the NHS cops a lot of criticisms sometimes, but overall.. I'm glad its available and not something left to the individual to source, fund and monitor.
I guess its not _all_ bad :wink:


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## ByronBlack (12 Feb 2009)

The co-op would be a good choice if you are thinking of safety. They aren't as frivolous and maverick as the regular banks and have recently agreed to merge with Brittania to make them even bigger and more secure.

However, you need at least 3% maybe more to protect your savings from the massive inflation that we are going to see in the coming years due to all the cash that is currently and in the near future being printed.

Personally, I would spend it all or retire early


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## Grinding One (12 Feb 2009)

The little guy always pays the big guys share....taxes,the big guy gets loopholes so he doesn`t pay any taxes...lately he has been putting his company`s business offshore (Third world countrys)So if he is making money he is also putting that offshore as well.Who is left to pay taxes?? The little guys,you and me ,while the Government is spending like never before money that is not there.Who is going to pay back all that money??Our kids,might as well be called serfs again...
Where to put money?? I would buy into Gold,it is the only thing left that is multinational as far as value...all currency is based on it.


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## ByronBlack (12 Feb 2009)

G1 - It is not true that all currency is based on the gold standard. The dollar for example is one that isn't.


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## BradNaylor (12 Feb 2009)

karl":mcuyr7dp said:


> I know it is off-topic, but I think the single biggest thing that could be done to bring house prices back in line is to outlaw Interest Only mortgages. They give a false perspective of the type of property which one can own and, when taken in conjunction with the high multiples offered by most lenders, have contributed significantly to ever increasing price rises. IMHO.
> 
> Cheers
> 
> Karl



You are quite right, Karl.

It is often said that the current financial crisis is as a result of 'sub-prime' mortgages dished out in the USA.

This is to ignore completely the UK's own sub-prime mortgage industry which has been rampant for years.

Interest only mortgages...
Self certified mortgages...
125% mortgages...
7 x income mortgages...

All designed to bring in the maximum commission for the salesman and profit for the bank. These pieces of rubbish were then bundled up and sold on as A1 assets. In other words fraud!

They were also designed to inflate house prices through the roof, which of course they did. Thereby increasing the value of the security held by the banks.

The British public have been victims of a monstrous Ponzi (pyramid) scheme perpetrated by the banks. There is no difference between them and Bernie Madoff.

Complicit in all this of course, have been the government AND the opposition.

Better get used to the idea of 25 years of austerity...

Dan

Who is not that bothered as I've lived in austerity all my life!



:lol:


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## Mattty (12 Feb 2009)

Matt- Who is off to find out what 'austerity' means...


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## BradNaylor (12 Feb 2009)

Mattty":144ajatu said:


> Matt- Who is off to find out what 'austerity' means...



Its how you're living since the building trade went **** up!

:lol: 

Onwards and upwards, though... 

Dan


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## big soft moose (12 Feb 2009)

Dan Tovey":2c1zvnmj said:


> devonwoody":2c1zvnmj said:
> 
> 
> > Well in the 50's they didnt take wifes earning into account when setting a mortgage, now they do, if I tell the banks to take into acounts childrens earnings do you think they would take that one up.
> ...



Thats assuming that earnings will go up in line with inflation - as a public sector worker i have had a below inflation rise for the last two years, and it looks like happening again as thanks to gordon halfwit brown and his merry interest rate cutting (to stimulate an already overinflated housing market :roll: ) some councils are three million quid or more short on revenue ( as a result of shortfall on invested capital), not to mention tht councils who had money invested in ice save didnt get it all back.

"prudence" brown dont make me £$%&ing laugh


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## big soft moose (12 Feb 2009)

duplicate - hit quote instead of edit - doh


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## Jake (12 Feb 2009)

Plenty of private sector people are taking real pay cuts (pre-inflation).


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## BradNaylor (13 Feb 2009)

Interesting...

When I posted my views on banks, the property market, and a then looming recession a year or so ago, people like Roger S and Jake replied with strident defences of the banking system.

Now they're very quiet.

What happened, guys?

:wink: 

Dan


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## mahking51 (13 Feb 2009)

Hi All,
My two cents worth:

I do not think that we have got to anywhere near the bottom of this mess yet.

The full impact of debt/equity swap scams has yet to really make its impact with it associated 'insurance' risks. I believe Barclays are heavily exposed here. The first class action cases are coming up in the US which will put the cat well and truly in with the pigeons.

Potential exposure is in the trillions.

The pineapple government is about to start printing money as all else has failed.

Interest rates are non viable for savers/ people looking from income

The classic historical hedge for all this is gold but really only if one is able to take a 3-5 year view in my humble opinion.

Personally I have bought physical Krugerands and will continue to do so on significant dips. I very occasionally take profits but as I believe the long term price will well exceed £1k per ounce ( some US pundits give $2000!) I find it tragic that Brown as Chancellor picked with uncanny instinct the precise moment to sell a vast amount of our gold reserves when the price was at is lowest for ages!

Cheers,
Martin


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## lurker (13 Feb 2009)

Thanks for your advice folks.
much confirmed what I had thought.

After discussion with SWMBO (this is no jest in our house).

We will contiue to bank with Leics Alliance, but one foot wrong & we move to Co-op. No more savings with them though - just day to day stuff.

Couple of K into premium bonds for a dream.

As currrent bank ISAs ripen & other rainy day savings we will move to the local building Society -maybe: will have to "interview" them out first.


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## ByronBlack (13 Feb 2009)

Luckily I have no money or assets to speak of, so unlike you Lurker I don't have to worry to much, but, it sounds like you have the most sensible approach. Despite the massive tragedy waiting to happen in the form of CD Swaps and what-not I don't think we'll end up in a post-apocalyptic mad max style society.

However, IF I did have money, I would certainly look into personal gold, and perhaps stock up on non-perishable food, water and a secure shelter of some-sort just in case we suffer a blip and looting/panic buying starts - which might not be far off.


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## BradNaylor (13 Feb 2009)

mahking51":2tg5el5r said:


> Hi All,
> 
> 
> 
> ...



The ramping of gold as a safe haven investment on hundreds of websites around the world amuses me.

It is quite clearly a well-orchestrated plot to entice in millions of small investors disenchanted with the interest on their savings.

And when gold does hit $2k per ounce...


The plotters will have long disappeared - with your money!

All you will be left with is a small chunk of yellow metal which has little actual intrinsic value other than the value it is *perceived* to have.

A bit like a tulip bulb, actually!

Cheers
Dan


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## Jenx (13 Feb 2009)

> clearly a well-orchestrated plot



By so few, to the detriment of so many ? 
Surely not ! :wink: 

The'illuminati' still looking after their own... its preposterous      :wink:


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## ByronBlack (13 Feb 2009)

Dan, you are wrong about gold, it has always had an intrinisc value, hence it's historical standing as a 'standard' and will continue to do so - and the reason why is because it's a finite resource, therefore the value cannot be diluted by the introduction and creation of more, unlike money which is the polar opposite and can and is currently being diluted.

If you put 10k into a bank, in a few years time it will be worth less than it is now due to the dilution (inflation) of our currency as it's not back by any finite resource.

Gold on the other hand will always return a degree of value, and if anything, is likely to go up over time like it has done over the course of history as we have come to rely on non-backed infinite resources such as currency.

I know where I would rather have my money in the long-term. (if I had any


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## BradNaylor (13 Feb 2009)

Gold's only _intrinsic_ value is for its use in certain industrial and electrical processes.

Any perceived value over and above that is purely an act of faith, based on nothing other than a belief that someone else will also value it highly.

Yes, gold is a finite resource. But so are all metals.

The 'mystique' of gold is purely an invention of the human mind.

Dan


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## Racers (13 Feb 2009)

Hi,

I was reading Nation Geographic the other day it had an article about gold, it seems that only 161000 tons have been mined in total, that seems a lot but it would only fill two Olympic sized swimming pools.


Pete


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## ByronBlack (13 Feb 2009)

Dan - gold has always been since it's discovery a demanded resource, it could be a figment of our imagination or whatever, that doesn't alter the fact that it's a very secure investment in something that will always been in demand. It's not just used in industry either. It's used in art, medical, science research, architecture etc. etc. As long as there are humans on the planet, gold will be an in-demand resource.

But, you are right about other metals too, there are many in-demand finite resources, but gold has always stood up as a reliable vehicle, you can't deny history.


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## Jake (13 Feb 2009)

Dan Tovey":2ya254qv said:


> Interesting...
> 
> When I posted my views on banks, the property market, and a then looming recession a year or so ago, people like Roger S and Jake replied with strident defences of the banking system.
> 
> ...



Chuck us a link to something where I was strident in defence of the banking industry?

I do still think you are overestimating the downside, but we'll see. People become as irrational on the way down panic as they become in the way up froth.


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## Jake (13 Feb 2009)

Dan is right on gold, that's for sure - check a price chart - it is anything but a secure investment.


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## ByronBlack (13 Feb 2009)

Jake":31fg2ei2 said:


> Dan is right on gold, that's for sure.


 You present that as fact, when actually it's an opinion. I'd rather go with known facts and historical data.


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## lurker (13 Feb 2009)

Byron,

You are "sort of right"

Houses are also an in-demand resource and always will be.

We were told bricks & mortar are a sure fire investment but look what happened last autumn.

" warning: Your gold may be at risk, the price of your gold can go down as well as up" :lol: :lol: 

I bought 2 kruggerands about 20 years ago. Taking into account inflation (my version of this is what my weekly wage was then compared with now), they are worth about what I paid for them then.


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## ByronBlack (13 Feb 2009)

Lurker - we have not had any massive inflation for decades, nothing like what is coming, you'll be happy to have your gold when that happens.


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## lurker (13 Feb 2009)

Byron 

I think you worry too much!!

I witnessed the massive redundancies in the 70s and the situation out side "the city" is no where near near as bad this time.

My mortgage hit 17% IIRC, for example

But if you believe "we are 3 meals away from anarchy" (who said that by the way??). I think the best investment would be a shotgun & cartridges :lol: :lol:


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## Jake (13 Feb 2009)

ByronBlack":xyuy2l7v said:


> Jake":xyuy2l7v said:
> 
> 
> > Dan is right on gold, that's for sure.
> ...



It is not an opinion that gold's intrinsic value is a tiny proportion of its price. The rest is confidence. 

What part of this chart suggests that gold is a sensible investment? (As opposed to potentially sensible speculation)?

http://www.kitco.com/scripts/hist_chart ... graphs.plx


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## Jake (13 Feb 2009)

ByronBlack":tcvnynzv said:


> Lurker - we have not had any massive inflation for decades, nothing like what is coming, you'll be happy to have your gold when that happens.



I think the policy-makers would love to have a nice easy problem like inflation to solve.


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## ByronBlack (13 Feb 2009)

Jake":2bnqjf9t said:


> ByronBlack":2bnqjf9t said:
> 
> 
> > Lurker - we have not had any massive inflation for decades, nothing like what is coming, you'll be happy to have your gold when that happens.
> ...



I'm sure they would, but still, they are using 'quantitive easing' as a 'method' to get us out of this mess, only for us to then have to deal with hyper-inflation that ensues, , either way it's not great.

Either way, I have nothing to lose other than a mortgage, so I'm not going to get too worried about it. As long as those greedy swines at the banks and hedges suffer, I'll be happy.


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## Jake (13 Feb 2009)

Hyperinflation is not a necessary outcome of quantitative easing. 

People point to the Weimar Republic, Zimbabwe etc, but there were other good structural reasons why output in those countries could not rise in response to the increased money supply - if that's the case then a bigger pot of money is chasing the same amount of stuff, and yes, spiralling into hyperinflation is inevitable if money keeps being printed. 

But to say that is inevitable in all other circumstances is to take a massive short-cut through reason.

And if that wasn't the case, it wouldn't be being considered by policy-makers who are way better economists and way better informed than you or I (and who are, incidentally, almost universally inflation-hawks.)


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## ByronBlack (13 Feb 2009)

Jake said:


> And if that wasn't the case, it wouldn't be being considered by policy-makers who are way better economists and way better informed than you or I (and who are, incidentally, almost universally inflation-hawks.)



Sorry, but that's where you have lost me - you think these policy makers are up to the task? They've ruined this countries economy though their pathetic 'leadership' so far, what evedince is that there know what to do know? Just because someone is in a position doesn't mean they actually know what to do with it.


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## Paul Chapman (13 Feb 2009)

Jake":2jjdv770 said:


> it wouldn't be being considered by policy-makers who are way better economists and way better informed than you or I



I'm assuming you had your tongue in your cheek when you wrote that, Jake :? :lol: 

Cheers :wink: 

Paul


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## Jake (13 Feb 2009)

You expect too much, leading you to give too little credit.

(pun unintended, but made me laugh)


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## ByronBlack (13 Feb 2009)

Jake":1b2kivig said:


> You expect too much, leading you to give too little credit.
> 
> (pun unintended, but made me laugh)



cookie quote aside, I disagree completely. Go and look at the business news today and try and justify that these muppets have any clue as to what they are doing.

The bare minimum that I expect from elected 'servant's of this country is too look out for it's populace and to tell the truth - both of those expectations have been beyond them so to expect them to fix a crashing economy that they are complicent in creating is a stretch too far. And as for credit, if they deserved it, they would get it, but they do very little that deserves credit.


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## Grinding One (13 Feb 2009)

lurker":2pw62jsp said:


> Byron
> 
> I think you worry too much!!
> 
> ...



You guys can buy those again??I never sold mine ,never know when you will get called up....


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## Jake (13 Feb 2009)

If you guys want to play the blame game with that degree of vitriol and certainty, you need to move somewhere with a command-and-control economy.


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## Jenx (13 Feb 2009)

We've_ always_ been able to buy them G1 !
They're licenced ( or rather the OWNER is licenced ), but yes, we can buy Shotguns, and (up to semi-automatic ) rifles here, with no great problem.
8)


Jake - you're not seriously implying that you have implicit trust and faith in the current regime, are you ?
If the answer was in the affirmative, then "fair enough to you," ... but seriously... you don't, do you ?
And i mean that as an 'all ecompassing faith' as opposed to trusting them to lead the country out of what is probably the worst financial crisis in living memory, as a 'stand alone' issue ?
If you do.. then I admire your conviction ...
but don't share in your optomism on the matter...

( not that the 'alternative' is anything better.. it isn't. :? )


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## Grinding One (13 Feb 2009)

It is always a supply and demand economy...if you can wait it out,you may do well .If the big boys can not make money from their money what good is it??
Me I am moving my money to my wallet and keeping what I have....let see who has more will power


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## BradNaylor (13 Feb 2009)

Jake":3ppbe1k4 said:


> Dan Tovey":3ppbe1k4 said:
> 
> 
> > Interesting...
> ...



My apologies, Jake.

I was thinking of this thread.

https://www.ukworkshop.co.uk/forums/view ... sc&start=0

But on re-reading it I find that your comments were not as pro-bankers as I remember them at the time.

Roger's, however...

:wink: 

Dan


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## devonwoody (13 Feb 2009)

Stop worrying about the UK economy, I read this morning that Italy has been into recession 4 times in the last decade. etc.etc.
They seem to have a very good lifestyle, better pensions and benefits than us, and if their government tries to do anything about it, they do a Brutus.


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## Jenx (13 Feb 2009)

I'll try that with the Building society when they come chasing their mortgage payments ...

"Stop worrying Mr Abbey National ... I canna pay you, but hey, I'm not Italy "
         

When I've returned from Casualty, having had Mr Abbey's foot removed from my nethers, I'll let you know how it all went :wink: 


Have a good weekend DW, take it easy ! 8)


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## Lee Brubaker (14 Feb 2009)

An interesting thread & being in Canada the conversation has been a learning experience for me.
I will be 78 come July & have been mortgage free for 36 years with the last house that we presently live in purchased new in 1991. Hence, when I recieved my paycheque I was able to pay myself first instead of a bank. We have no debt whatsoever paying cash for autos, furniture, renovations, etc. We use a credit card as a convience & pay the bill in full monthly.
We did not invest in stocks & bonds. I refused to rely on the stockmarket as to what the quality of my retirement would be. So we did not have fantastic gains of the stock market nor the latest loss of 45% in value since last June. Many seniors in this country are in trouble because of the loss of value in their portfolios. Instead we purchased Bank Guaranteed Investment Certificates which are in turn insured by the Canadian Depositors Insurance Corp.(Crown Corporation).
Granted the growth was low due to low interest rates but steady & in REAL
money....not some pie in the sky value generated by the stock market.

The current economic situation was caused by low interest rates that had no relation to risk or real inflation and it took about 25 years for the piper to arrive at the door & demand to be paid.
If you think your Gov't is quoting real inflation with their very low bank rates think about those things that could be termed cost of living such as housing(rents or ownership) food, transportation, utilities, etc. & if like here in Canada these things have doubled in price over the last ten years, then real inflation has been running at 6% plus per year.

These phoney low interest rates encouraged individuals & corporations to carry ever increasing loads of debt. & with very little Gov't oversight on the Finacial Industry, it ran unchecked....especially in the U.S. & also with many instances of fraud.

While Gov'ts try to shore up banks & industry by pumping HUGE quantities 
of funds into the system, I do not see them addressing the cause of the problem with regard to phoney inflation rates to back up low interest rates.
If they continue to refuse to face reality, then we are going to be looking at global depression. And if that happens then Governments will largely become irrelevant.

You think not ??? Are you aware that California, formally known as the richest State in the Union is now bankrupt ? On tax refunds they are sending out I.O.U.'s to people instead of cheques.

Those who think gold is a good investment from a safety point of view....just remember you can't eat gold & it is only worth what someone will pay you. And if you do buy gold make sure you take delivery & not accept a slip of paper that says you own x amount of gold.

Lee


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## Grinding One (14 Feb 2009)

That is the best observation I have heard.


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