# Demise of the Euro?



## aivlys (May 1, 2005)

Just been listening to the radio today about the potential demise of the euro. I have a Caxton FX card with 'n' euros loaded on it, does anyone know what will happen if the euro fails, will I and others like me lose our money?

I undertstand that euros in the bank will simply be converted to the currency applied at the time but the caxton card is 'cash' so not sure whether to continue to load it or try and spend it before the crash.

Any thoughts out there?

Sylv


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## rayc (Jun 3, 2008)

*Re: Demise of the EURO?*



aivlys said:


> Just been listening to the radio today about the potential demise of the euro. I have a Caxton FX card with 'n' euros loaded on it, does anyone know what will happen if the euro fails, will I and others like me lose our money?
> 
> I undertstand that euros in the bank will simply be converted to the currency applied at the time but the caxton card is 'cash' so not sure whether to continue to load it or try and spend it before the crash.
> 
> ...


You are in no different position than someone with a load of Euros. In any event I doubt very much if core countries like Germany, Holland, Belgium and France will give up the Euro that easily.


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## Coulstock (Sep 2, 2008)

Won't happen - bigger disaster for the core countries 'abandoning' the euro rather than sticking with it

Harry


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## Penquin (Oct 15, 2007)

There is no mechanism in the treaty for it's demise so that would require major agreements from ALL EC countries - not just the Eurozone ones, due to the recent changes in voting procedures :lol: 

The chances of that happening ar not great and it would take months of warnings before it happens. At present there is not even a system to remove one country from it - even if their balances have been shown to be inaccurate at the time of accession to it........

So it is unlikely that anything will happen - other than Germany ruling more of Europe and certainly paying for more of Europe, before it gets close to that situation there would be sufficient warnings for anyone who is not sure to reduce their Euro holdings (which will make things worse) - your Caxton card is small fry c/w the amounts held by banks and other countries as speculators that the value will change and they wil make money........ 

but if you are not sure, feel free to send it to us and we will make sure it is used wisely ! :lol: :lol: 

Dave


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## SaddleTramp (Feb 15, 2007)

Oh I am not so sure :- < Prepare For end of Euro Banks Told >


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## Bill_OR (Feb 6, 2010)

The Issue that Paul Lewis (BBC) flagged the other day is whether there is any protection for holders of pre-paid cash cards if the card provider goes bust. He didn't know the answer!


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## peribro (Sep 6, 2009)

Bill_OR said:


> The Issue that Paul Lewis (BBC) flagged the other day is whether there is any protection for holders of pre-paid cash cards if the card provider goes bust. He didn't know the answer!


There is no protection for holders of pre-paid cash cards. The following is from Caxton's website here

"21. Compensation 
The Prepaid Card is an electronic money product and although it is a product regulated by the Financial Services Authority, it is not covered by the Financial Services Compensation Scheme. No other compensation scheme exists to cover losses claimed in connection with the Prepaid Card. This means that in the unlikely event that Raphaels Bank becomes insolvent Your funds may become valueless and unusable and as a result You may lose Your money."


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## steco1958 (Mar 5, 2009)

peribro said:


> Bill_OR said:
> 
> 
> > The Issue that Paul Lewis (BBC) flagged the other day is whether there is any protection for holders of pre-paid cash cards if the card provider goes bust. He didn't know the answer!
> ...


The Caxton, and any other Cash card, is not designed to be loaded throughout the year to the extent that you are keeping €€€€€€€'s on it for months on end, it is designed to load prior to visiting Euroland and spending as cash, returning with little or no money left on the card, then restock just prior to the next trip.

I don't think the Euro will fail, too big of a disaster, but I would suggest, saving your ££'s and only transffering to the Caxton, just prior to visits to Euroland.

Steve


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## SaddleTramp (Feb 15, 2007)

Personally I ONLY transfer funds to my Caxton Euro card when needed, I do this either by logging on or Texting and the money is available right away, I also have the Caxton pound card which can be used anywhere to exchange to local currency I do keep a very small amount of money on that one for emergencies only.

I also have a Greek Euro card and I can transfer money into that account from the Caxton Bank Transfer system.


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## spykal (May 9, 2005)

Hi

Just hope on hope that the Euro is not allowed to collapse because if the Euro collapses the fallout will be so catastrophic that the money you have invested in your PrePaid card will be the least of your worries. The riots, civil disorder and crime that would follow the collapse would prevent any thoughts of travel to Europe for some considerable time and if the unrest spreads to the UK we will all be baracading our homes rather than venturing out in our motorhomes.

If you doubt what I am saying check out the recent warnings from the Foreign Office.

So that's the reality of the situation ...not a nice Monday morning thought is it?

Mike


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## steco1958 (Mar 5, 2009)

spykal said:


> Hi
> 
> Just hope on hope that the Euro is not allowed to collapse because if the Euro collapses the fallout will be so catastrophic that the money you have invested in your PrePaid card will be the least of your worries. The riots, civil disorder and crime that would follow the collapse would prevent any thoughts of travel to Europe for some considerable time and if the unrest spreads to the UK we will all be baracading our homes rather than venturing out in our motorhomes.
> 
> ...


Totally agree with your comments Mike, however has as been said on hear and thankfully where it counts government level, they can not allow it to fail, so it will not fail, there may be a few victims along the way, we just have to make sure that the UK does not become one of those victims.

Fingers crossed.

and toes

Steve


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## Techno100 (May 8, 2010)

€1750 on mine and not worried :thumbup:
I'll take half in francs an half in potatas :lol:


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## jud (Aug 15, 2009)

hi . i am not surprised its on its way down the nick its over inflated anyway when the euro came out it was worth 59pence and look at it now . some politicians in Brussels said it would not work having all those countries sharing the same currency but they was in such a rush to implement the euro they would not listen .jud


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## tulsehillboys (Jul 22, 2010)

The money on a caxton card has no real protection. If Caxton goes bust so does your money (unlike uk bank and building soc accounts)!
Just add what you need and spend it.


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## Techno100 (May 8, 2010)

I'm staying in the cup is half full brigade :lol:


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## rayc (Jun 3, 2008)

If the euro is so weak and under pressure why is the exchange rate of the £ so poor against it?
If investors are using the UK as a safe haven then shouldn't the £ be getting stronger against the € ?


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## peejay (May 10, 2005)

Sylv,

If you're still concerned then you can always redeem your excess cash from the card and leave it empty, according to the t&c's it will cost a max of €2 to do this.
Trouble is if you decide to load it again later then you are at the mercy of the exchange rate at the time.

Pete


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## Penquin (Oct 15, 2007)

rayc said:


> If the euro is so weak and under pressure why is the exchange rate of the £ so poor against it?
> If investors are using the UK as a safe haven then shouldn't the £ be getting stronger against the € ?


Two thoughts;

1. it is in the interests of the UK Government to keep the rate £ low c/w the € - it makes exports effectively cheaper and imports more expensive,

2. the £ is better than it was - at one point it was nigh on 1:1 £ : €

the rate today is 1 British pound = 1.16281489 Euros

http://www.x-rates.com/d/EUR/GBP/graph120.html

steady rise in £ : € rate for last 120 days with a few ups and downs....

Dave


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## rogerblack (May 1, 2005)

My understanding is that whilst there is no mechanism to eject a country from the Eurozone, there is nothing to stop a country removing itself and thus regaining its own sovereign powers, including currency.


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## GEMMY (Jun 19, 2006)

Can someone tell me what the hundreds of tonnes of gold each country has in reserves used for?

To look pretty or just to hoard

tony


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## Techno100 (May 8, 2010)

I believe the financial wizard gordon brown sold ours when the price was rock bottom :lol:


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## rogerblack (May 1, 2005)

spykal said:


> Hi Just hope on hope that the Euro is not allowed to collapse because if the Euro collapses the fallout will be so catastrophic that the money you have invested in your PrePaid card will be the least of your worries. The riots, civil disorder and crime that would follow the collapse would prevent any thoughts of travel to Europe for some considerable time and if the unrest spreads to the UK we will all be baracading our homes rather than venturing out in our motorhomes. If you doubt what I am saying check out the recent warnings from the Foreign Office. So that's the reality of the situation ...not a nice Monday morning thought is it? Mike


Is it not the case that the existing riots are in countries where the population are protesting at the austerity measures being foisted on them by other Eurozone members so that they remain in the Euro?

From the discussions I regularly have with ordinary citizens (as opposed to politicians) of other European member states, it's more likely there would be dancing in the streets if the Euro disappeared.

If you want to hear someone who understands the true root causes of the problem, you may like to listen to just over 3 minutes of common sense here:


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## peribro (Sep 6, 2009)

rayc said:


> If the euro is so weak and under pressure why is the exchange rate of the £ so poor against it?


Because investors expect the UK economy to take longer than the Euro economies to come out fully from recession. They anticipate UK interest rates having to stay low for longer than the Euro and hence do not want to buy Sterling. 


rayc said:


> If investors are using the UK as a safe haven then shouldn't the £ be getting stronger against the € ?


They see it as a safe haven (relatively speaking) for depositing money through the lending of money to the UK by the purchase of UK bonds. However the bonds we are issuing are to replace existing maturing bonds and to finance new borrowing. To the extent that the bonds are a replacement for expiring ones then the net effect is neutral. Where they are financing new borrowings then that is a double edged sword as the need to increase our borrowings is a reflection of the weakness of our economy. Another factor to consider is that purchasers of UK debt may well be hedging their currency exposure by selling Sterling in equal amounts. Thus they would have the "safe" investment without the currency risk.


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## tulsehillboys (Jul 22, 2010)

GEMMY said:


> Can someone tell me what the hundreds of tonnes of gold each country has in reserves used for?
> 
> To look pretty or just to hoard
> 
> tony


Currencies are not backed with gold anymore - they are backed by the markets - hence the chaos 8O


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## GEMMY (Jun 19, 2006)

SO???????????

What is the gold used for????????

tony


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## rogerblack (May 1, 2005)

Techno100 said:


> I believe the financial wizard gordon brown sold ours when the price was rock bottom :lol:


Yup - I believe he sold about 375 tons (about 60% of our reserve) when the price was around US$275 an ounce, he got around US$3.5 billion. Currently US$ 1740/ounce, so would be worth around US$23 billion. :roll:


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## JackieP (Oct 15, 2006)

We're currently down in Sicily and have been following the news with interest. I thought it odd that the Foreign Office did not have any advice for the many travellers and expats currently in Europe and then I stumbled across this article this evening.

Travelling Abroad...

My understanding was that if the euro should fail - it would do so slowly - that it would take time for alternative currencies to be put in place. If it happens as the writer of this blog suggests, there are going to be a fair few of us up **** creek without a paddle. Literally.

Worrying times.


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## Glandwr (Jun 12, 2006)

We went off the gold standard in the 30's. It allowed us to devalue, it was so successful that the whole of the western world followed. The US and France were last. Gold in vaults has been dead money since.

Dick


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## GEMMY (Jun 19, 2006)

So why don't the piigs sell theirs and reduce their debts?

tony


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## Glandwr (Jun 12, 2006)

I don't know. How much have they got? It would have to be sold slowly though. To do other would put further pressure on their debt rate and be counter productive.

Dick


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## GEMMY (Jun 19, 2006)

Dick,

http://en.wikipedia.org/wiki/List_of_countries_by_foreign-exchange_reserves

tony
Top 10 Nations by Gold reserves :

Country

Dec-09

Mar-09

% of reserves

United States

8113.5

8113.5

68.7

Germany

3407.6

3412.6

64.6

Italy

2451.8

2451.80

63.4

France

2435.4

2487.10

64.2

China

1054.00

1054.00

1.5

Switzerland

1040.10

1040.10

28.8

Japan

765.2

765.2

2.4

Netherlands

612.5

612.5

51.7

Russia

607.7

523.7

4.7

India

557.7

357.7

6.4

All other countries

26780

26349

10.2

47825.5

47167.2

Plus

Plus:

http://www.cnbc.com/id/33242464/The_World_s_Biggest_Gold_Reserves?slide=2


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## Glandwr (Jun 12, 2006)

Do you think that they should be forced to sell even if it could make their plight worse Tony? 

Dick


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## GEMMY (Jun 19, 2006)

How can it be worse, you've already said that gold is nothing, but, the thought of having to sell, might focus their minds. Why should evryone take haircuts so that they can keep their shiny. Sell the colloseum, the parthenon, thousands of islands, make them put up some collateral. They can always buy them back when they become solvent.

tony


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## Glandwr (Jun 12, 2006)

What we did to the Germans after WW1?

Dick


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## GEMMY (Jun 19, 2006)

Don't know the detail, can't comment. BUT, if was awful it seems to have worked 60 years later. :wink: 

Greece was supposed to have privatised loads, but what have they done, bugger all. They just preferred to vivit the 'crimper' to arrange a 'haircut'. :roll: 

tony


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## Glandwr (Jun 12, 2006)

The allies really picked Germany down to the bone in reparations. Caused all kind of ills.

Dick


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## GEMMY (Jun 19, 2006)

maybe that's what's needed. Looking at their state guard, if they kick up a fuss, it'll be like being attacked by the 'morris dancers'.

tony


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## aivlys (May 1, 2005)

Tks for all the chit chats and Pete for your advice.

Taking a broader view I am hoping that the demise would not be a pan wide european decision, I think it more likely it would be individual countries, ie Greece first. In which case I could do as Pete suggests and cash in my cash for £2 or ensure I visit a country where I can spend it.

I know a lot of you load the card for spefic journeys but as I have both a spanish bank account and a UK account I am taxed on any money I keep in the Spanish account, so I tend to load the card when the rate is good and use the card on an adhoc basis. Transfering cash from bank to bank also incurs additional costs so again loading the Caxton Card has suited my needs. 

Anyway, fingers crossed ........


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## seanoo (Mar 31, 2007)

hi all, not being clued up about all this economic stuff i would like to ask a question. if all the countries in the eu/ world owe all this money then who do they owe it all to? is there some super rich mega country waiting to be paid all this owed money?? or am i just being thick? all the best sean


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## rogerblack (May 1, 2005)

seanoo said:


> hi all, not being clued up about all this economic stuff i would like to ask a question. if all the countries in the eu/ world owe all this money then who do they owe it all to? is there some super rich mega country waiting to be paid all this owed money?? or am i just being thick? all the best sean


All the countries in the world don't have large debts; to name just a couple who are more lenders than borrowers, the Middle East* and latterly China. But also don't forget that a lot of each country's national (public sector) debt is actually owed to its own private sector including the financial sector as well as individuals within that country, through Government bonds, gilts, etc. For example, although Japan's national debt is over 200% of its GDP, 90% of it is owed to Japanese citizens & institutions, mainly because of its low interest rates.

The UK actually has one of the lowest public sector debts in the EU.

Possibly of more urgent concern is the UK deficit - the UK has one of the highest public sector deficits in the EU.

If you're interested, more on the subject can be found online e.g. here:

http://www.economicshelp.org/blog/334/uk-economy/uk-national-debt/

*Edit - yes, I know the Middle East isn't one country!


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## rogerblack (May 1, 2005)

seanoo said:


> hi all, not being clued up about all this economic stuff i would like to ask a question. if all the countries in the eu/ world owe all this money then who do they owe it all to? is there some super rich mega country waiting to be paid all this owed money?? or am i just being thick? all the best sean


Actually, Sean, please ignore my previous post - these guys know all the right questions:






PS any resemblance between the Roger in this video and myself is purely coincidental . . .


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## Glandwr (Jun 12, 2006)

To look back to the question who owns the debt? Up until the last quarter of the 20th C much of the govt. debt in Europe was owned by a handful of banking families. Our biggest was founded by Nathan Rothschild. He increased his already huge fortune 20 fold in a matter of months.

The armies on both sides in the Battle of Waterloo where Napoleon was taught a lesson were funded on money loaned from him. He saw an opportunity and placed observers with Wellington. As soon as the battle was decided they sent the news back to Nathan in London. A couple of hours before the official message from Wellington arrived he caused a panic on the London Bond market by selling British bonds frantically. After the price had tumbled he piled in and bought everything he could though other banks. 

That money is still there and Nathan’s family are still one of the richest in the world, but their money is now dwarfed by what is called footloose capital that is difficult to trace back. 

Incidentally Ed Balls’ brother is a senior in a firm that uses such capital to buy govt. bonds.

Dick


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## peribro (Sep 6, 2009)

seanoo said:


> hi all, not being clued up about all this economic stuff i would like to ask a question. if all the countries in the eu/ world owe all this money then who do they owe it all to? is there some super rich mega country waiting to be paid all this owed money?? or am i just being thick? all the best sean


 Not all the countries in the world owe money but an awful lot do. Those that do owe money generally owe it to a combination of other countries (many of which now invest through sovereign wealth funds), domestic and foreign banks, pension funds and other such financial institutions, corporates and private investors. Some are even lucky enough to owe money to the IMF!


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