Transferring money to Euros?

[umpteennamechanges]

I don't know whether it's best to post this here or prepping?

Is anyone transferring money to Euro ahead of Brexit?

For those of us with only small(ish) savings pots - is it worth it?

I can't really get my head around the best option...will I lose more in commission than I might lose in the in my opinion inevitable decline of the £ post Brexit?

UK Interest rates will not go above 2% for the next 10 years no matter what happens with Brexit.
Of that I am utterly certain.

UK Interest rates will not go above 2% for the next 10 years no matter what happens with Brexit.
Of that I am utterly certain.

Are you an economist?

Problem with Brexit is that a no-deal exit could involve a cascade of consequences, which makes predictions very difficult. Anyone putting numbers to it is doing so on the basis of a set of assumptions.

Mistigri
No I am not an economist, but I regularly review the DMO website which offers fixed rate long term (up to 50 year) loans
with a legal requirement to make a profit on each loan.
And the rates for ten year loans are 1.91%
www.dmo.gov.uk/data/pdfdatareport?reportCode=D9A.1

There is no driver on the world economy to push UK interest rates up
and HUGE drags on the UK economy to hold them down

Forecasting is easy if your base case assumption is that nothing much is going to change.

(Disclosure: forecasting usually over a 10 year period is my professional activity; when people ask me what I do for a living, I tell them that I am paid to get things wrong).

Thing is I watch that page most weeks ....
they factored in Trump when he became candidate and then again when he won and then again for the mid terms
they have been factoring in Brexit in stages
the rates change every day. Not by much, but by enough.
I will be interested to watch it before and after the WA vote

and yes, I'm glad I'm not an actuary or a quant

But that's the problem .... short term changes are usually a great indication of the medium term future - right up to the point when they're not.

Forecasting dislocations is extremely difficult, which is why most people lost money in 2007/2008 (obviously a few people did well out of it, but IMO often more by luck than by judgement; those same contrarians - people like Christian Odey - have often done quite badly in recent years).

True, but I cannot see any drivers out there that would push rates back up to the ones we all remember from the 80's

• global population growth has topped out
• most of the remaining growth is due to ageing and old folks are deflationary
• much of the world has reached peak stuff
• climate change will dampen economic growth
• resource depletion is now global

You have to distinguish between long term and short term drivers. I'm agnostic on what will happen to interest rates tbh as I think that post no-deal Brexit forecasts are just too difficult (sure you can do it; the only question is not whether your assumptions will be wrong, but how wrong they are).

I've been doing roughly the same thing (forecasting) for 30 years and I've been through four or five market "dislocation" events and every single time, people said X cannot happen and every single time it turned out that X could definitely happen and indeed already had .

These sort of existential questions are why gold is having a bit of a revival at the moment.

That Farage was into gold trading IIRC.

No UK bank has failed since the early 1970's

Northern Rock ???
RBS ???

I can remember the run on Northern Rock, DH and I were part of it!

Thanks for the thread OP, exactly what ive been wondering today....

We were due to start some building work this year, which we've been wanting to do for a while, it I'm not sure me is the best time...

Quinions
A bank that fails loses its depositors their money.
Northern Rock savers did not lose their money, nor did RBS, nor did ING - the accounts were taken over by others.
BCCI did but that was a rather extraordinary case and not actually a UK approved bank.

the risk to depositors now is so small as to be irrelevant in the Western World.

Agree I don’t think interest rates will rise. I’ve two mortgages about the same value and I’ve paid off my fixed rate and left my tracker running. Just hope that is the right call!

If sterling dives further (as predicted no deal scenario) and foreign capital outflows continue, accelerate even and inflation zooms up (on the back of GBP price increases on imports as a result of sterling, for example) then it's perfectly possible, likely even, that the BoE will increase rates. Not 80s level but to double current rates is not a stretch imho. Particularly given the US stance on tightening. Past BoE rate decision minutes go into this issue (available on BoE website).

Oddly, just reading @Talkinpeace 's comment, my DH is an economist and says the same thing...eg won't go above 2%. He's pretty set on that and has tried to explain why but I'm utterly rubbish with numbers and can't follow it at all.

Meanwhile - just wondering, what would be the chance (however small) of the £ collapsing completely? If we leave the EU, does that not leave us and our OOAK currency rather vulnerable?

BoyMeets
There is enough of the worlds financial flow denominated in Sterling that once it drops to parity with the dollar (as it did in 1978) the vultures will swoop and push it back up again.

Drivers of inflation .... wages growth is the main one and its interesting because there is so much underemployment in the UK
but if the EU folks stay away wages will need to rise to attract Brits
but the public sector has its funding capped due to austerity
vicious cycle

only breakable by returning taxes to what they were under Margaret Thatcher
I LOVE saying that to Tories