# Euro Value Freefall?



## zach21uk (Jun 26, 2014)

Good Day all,

I do not claim to be any kind of financial expert. I'm good at making money but not really good at understanding financial markets and now I find myself trying to make some kind of sense of whats happening with the euro.

When I see that I am getting 1.31 euros to the pound compared to 1.25 a month or two ago, I tend to think of it as a good thing. Getting more bang for my buck so to speak. My rent relative to the pound has gone down from £384 to just £369.50 this month. To my gut reaction is to say "yay!"

Then I log onto various news websites such as the BBC or the Financial Times and their all stating that the Euro is in trouble, that its value is hitting all time lows against the dollar, rapidly decreasing in value against the pound, that the Swiss Franc has been un-linked from the Euro due to a lack of confidence, sending its own value soaring. Today the buzz in the news seems to be about quantitative easing. I've read numerous explanations of what it means, but I can't really suss it out.

Is anyone here able to provide a basic, easy-to-understand explanation of what is going on exactly? Is all of the above anything for the average joe to be worried about, or is it all simply media-based sensationalization?

Thanks
Zach


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## PeteandSylv (Sep 24, 2008)

If the value of a currency rises some pundit will be writing articles of doom and gloom.
If the value of a currency falls some pundit will be writing articles of doom and gloom.
If house prices go up some pundit will be writing articles of doom and gloom.
If house prices go down some pundit will be writing articles of doom and gloom.
If petrol goes up some pundit will be writing articles of doom and gloom.
If petrol goes down some pundit will be writing articles of doom and gloom.

Can you spot the pattern?

In any case unless you prepared to actively trade currencies why worry about it? You can't control it so if it works in your favour celebrate with a drink, if it doesn't have a consoling drink.

Quantitive Easing is today's buzzword for what used to be called devaluation of a currency. A country would declare a lower exchange rate for it's currency. As that cannot apply to countries in the Euro, to devalue the Euro against other currencies they simply print more money so it's worth less. They then pat themselves on the back, say what splendid, clever chaps they are and wait for what the hell will happen next.



Pete


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## David_&_Letitia (Jul 8, 2012)

zach21uk said:


> Today the buzz in the news seems to be about quantitative easing. I've read numerous explanations of what it means, but I can't really suss it out.


Quantitative Easing (QE) is the term used when Central Banks effectively print more money in order to buy government and financial institution issued bonds which should then drive down the interest rates on those same bonds whilst (theoretically) increasing the money supply which (again, theoretically) should be lent by those financial institutions to businesses in order to stimulate more demand.

Clearly, there is no need to actually print the money - it is effectively digitally created on the Central Bank balance sheet. This could just as easily be called 'creative accounting' ie creating an asset from nothing which in most businesses would be classed as malpractice. Clearly, as with so many other things, this does not apply when done by governments or their Central Banks.

This Thursday is the day when it is expected that the European Central Bank will announce QE of around €500Bn. The danger is if any country defaults after this cash injection as their debts would have to be picked up by other Eurozone countries - primarily Germany.

Bottom line?

I fully concur with Pete's assessment - have another drink!


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## zach21uk (Jun 26, 2014)

I wish I could just magically "digitally create" a couple million in my bank account without consequence! 

Thanks for the explanations though! I understand whats happening now


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## David_&_Letitia (Jul 8, 2012)

David_&_Letitia said:


> This Thursday is the day when it is expected that the European Central Bank will announce QE of around €500Bn.


WOW! The announcement was for QE of double that expected - €1.1 Trillion! The exchange rate has jumped to £1 = €1.32 already, and I suspect it will go much higher tomorrow when the markets open...


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## Baywatch (Mar 30, 2014)

David_&_Letitia said:


> WOW! The announcement was for QE of double that expected - €1.1 Trillion! The exchange rate has jumped to £1 = €1.32 already, and I suspect it will go much higher tomorrow when the markets open...


I think this will go on until we know what happens in the Greek election. And most of all what Germany decides to accept from Greece


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## wizard4 (Feb 3, 2013)

Well you all know the results of the greek election now so guess its hold your breath, or line up few drinks.
Cheers Slurp


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## Baywatch (Mar 30, 2014)

wizard4 said:


> Well you all know the results of the greek election now so guess its hold your breath, or line up few drinks.
> Cheers Slurp


I don't think anything will happen, Syriza realize that 2/3 of the Greek people still want the € and the country will go bankrupt if the EU stop sending them money. And they also realize that even if they get rid of the old loans, who will lend them more when they don't pay back. Some say Russia, but they have big problems of their own


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## David_&_Letitia (Jul 8, 2012)

wizard4 said:


> Well you all know the results of the greek election now so guess its hold your breath, or line up few drinks.
> Cheers Slurp


There is no getting around the fact that austerity has not worked, and the bullying by Angela Merkel in imposing and rigidly enforcing it has caused 25% unemployment in Greece and this rises to 50% when applied to Greek youth. At the beginning of the austerity regime 6 years ago, Greece's debt stood at 109% of GDP. It is now 175% of GDP despite tax rises and greatly reduced public spending. It would be ludicrous for any government to try for more of the same - an entire generation without hope.

Greece is now suffering deflation as a result of austerity which has the effect of increasing debt. This is also being experienced in other EU countries - that is why Quatitative Easing (QE) was introduced in the Eurozone - much against Germany's wishes (they have always argued against printing more money). If austerity had worked, there would be no need for the €1.1 Trillion QE announced last week. Don't forget that the USA and UK introduced QE years ago and both countries have now returned to growth. The intransigence of Germany - especially Angela Merkel - has not helped any EU country EXCEPT Germany. Funny thing!

The situation in Spain, Italy and Portugal is not that different and they are keenly looking to see what happens in Greece. What is clear is that anti-EU political parties and leaders are on the rise. Syriza in Greece has an equivalence in Italy, Spain, Portugal and even France (Marine Le Pen) and UK (Nigel Farage). - all populist parties. In a true democracy, the voice of the people must be heard and respected. Don't forget that ALL workers in ALL EU countries have been paying the price of the excesses of a very small elite.

Ultimately, I believe that there will be a typical EU fudge around the Grrek debt issue with both sides claiming victory for common sense.


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## PeteandSylv (Sep 24, 2008)

I agree with Anders. The result of the election in Greece was that a politician got elected. Politicians will say anything to get elected but when they are in power will do whatever will keep themselves there.

Greece leaving the EU and/or the Euro is not realistic. Greece needs the EU not the other way round. Leaving will leave them isolated and possible sanctioned or at least unfavoured in trading.

Many people are seeing huge debts as a terrible thing but most EU countries are debt financed. The real yardstick is the ability to meet debt repayments, that's how the UK has survived for as long as I can recall. If Greece can meet it's repayment schedule it will continue muddling along, if not it will probably continue muddling along with another slap on it's wrist.

It seems to me that the current structure of the EU is floundering and there are many reasons for this. Some believe there is a North EU/South EU difference in mentality and capability, some blame the entry of the insignificant East European countries sucking too many financial resources. Certainly the EU has reached an absurd cost level with regard to it's own administration. The future may well see the stronger countries seeking more rigorous tests and financial requirements which will be to the detriment of the weaker countries.

What will be interesting as the Greece thing plays out is any reaction in Cyprus. We are all aware of the absurd, unnecessary and historically naive affinity of Greek Cypriots towards Greece. Will they continue their constant support and flag waving which has cost them dearly in the last few years or will they gain enough sense to start ignoring anything Greek and stand firmly on their own ground?

Pete


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## Baywatch (Mar 30, 2014)

PeteandSylv said:


> I agree with Anders. The result of the election in Greece was that a politician got elected. Politicians will say anything to get elected but when they are in power will do whatever will keep themselves there.
> 
> Greece leaving the EU and/or the Euro is not realistic. Greece needs the EU not the other way round. Leaving will leave them isolated and possible sanctioned or at least unfavoured in trading.
> 
> ...


For me there is 2 things in the near future that will be much more important than Grexit or not.

It is the outcome of the election in the UK and outcome of a possible referendum. 

But also UK leaving the EU seems not very likely. As Pete say, UK live on borrowed money and can be punished if leaving the EU.


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## wizard4 (Feb 3, 2013)

I have come to the conclusion that all politicians suffer from short term memory loss, they forget what they promised, as soon as they are in power.
Cheers


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## expatme (Dec 4, 2013)

Baywatch said:


> For me there is 2 things in the near future that will be much more important than Grexit or not.
> 
> It is the outcome of the election in the UK and outcome of a possible referendum.
> 
> But also UK leaving the EU seems not very likely. As Pete say, UK live on borrowed money and can be punished if leaving the EU.


If the UK leaves the EU, there will be NO PUNISHMENT. The reason being is the LOANS will still be re-paid. Nothing to do with leaving.


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## Baywatch (Mar 30, 2014)

expatme said:


> If the UK leaves the EU, there will be NO PUNISHMENT. The reason being is the LOANS will still be re-paid. Nothing to do with leaving.


Dreamer


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## PeteandSylv (Sep 24, 2008)

expatme said:


> If the UK leaves the EU, there will be NO PUNISHMENT. The reason being is the LOANS will still be re-paid. Nothing to do with leaving.


But where will the next loan come from? The fact is that there is a lot of cross-lending in all countries not just a simple loan like your house mortgage. Don't believe me? Take a look at this clever graphic from the BBC. It's out of date but illustrates the point:
Eurozone debt web: Who owes what to whom?

Britain like many other countries exists on debt which keeps on growing. For debt to grow more borrowing is required, if the source of borrowing dries up there is a big problem just like Cyprus had when the government almost ran out of cash.

Pete

P.S. Did you know that the use of upper case letters on the internet is a convention for shouting?


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## Baywatch (Mar 30, 2014)

PeteandSylv said:


> But where will the next loan come from? The fact is that there is a lot of cross-lending in all countries not just a simple loan like your house mortgage. Don't believe me? Take a look at this clever graphic from the BBC. It's out of date but illustrates the point:
> Eurozone debt web: Who owes what to whom?
> 
> Britain like many other countries exists on debt which keeps on growing. For debt to grow more borrowing is required, if the source of borrowing dries up there is a big problem just like Cyprus had when the government almost ran out of cash.
> ...


And there is so much more that would be affected. Visa, trade etc.


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## expatme (Dec 4, 2013)

Baywatch said:


> Dreamer


As I so clearly stated there will be NO PUNISHMENT.


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## expatme (Dec 4, 2013)

Perhaps it might be useful to explain what the punishment would be?


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## Baywatch (Mar 30, 2014)

expatme said:


> Perhaps it might be useful to explain what the punishment would be?


I can read between the lines that you are positive to a UK exit.

As I see it it will be much higher interest on loans, custom fees on export, no free travel in the EU etc.

In Sweden there is a saying that you can't eat the cookie and still have it.


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## Veronica (Apr 5, 2008)

expatme said:


> As I so clearly stated there will be NO PUNISHMENT.


Ouch!!!!


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## expatme (Dec 4, 2013)

Baywatch said:


> I can read between the lines that you are positive to a UK exit.
> 
> As I see it it will be much higher interest on loans, custom fees on export, no free travel in the EU etc.
> 
> In Sweden there is a saying that you can't eat the cookie and still have it.


Thanks for that.

I am neither for or against the UK leaving the EU.


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## Baywatch (Mar 30, 2014)

expatme said:


> Thanks for that.
> 
> I am neither for or against the UK leaving the EU.


Sorry if I offended you

Perhaps you can tell me what you think about these things I mentioned, now when you say there will be no punishment.


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## expatme (Dec 4, 2013)

Baywatch said:


> Sorry if I offended you
> 
> Perhaps you can tell me what you think about these things I mentioned, now when you say there will be no punishment.


Any outstanding loans are on fixed rates. However it is my opinion that they would be carefully negotiated down and not up also that the period of the repayment would be extended. Your other comments I feel would be put into place.

I was not offended by any of your comments but thank you for the apology.


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## Baywatch (Mar 30, 2014)

expatme said:


> Any outstanding loans are on fixed rates. However it is my opinion that they would be carefully negotiated down and not up also that the period of the repayment would be extended. Your other comments I feel would be put into place.
> 
> I was not offended by any of your comments but thank you for the apology.


I cant see any reason for the lenders to accept this. Why should they?


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## expatme (Dec 4, 2013)

In banking it is well known that those with huge loans have to be "looked after" as a default would lead to great losses to the banks. No lender wants to lose the cash lent. So an extended term with fixed interest or even lower interest is always better than losing it all to default.


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## Baywatch (Mar 30, 2014)

expatme said:


> In banking it is well known that those with huge loans have to be "looked after" as a default would lead to great losses to the banks. No lender wants to lose the cash lent. So an extended term with fixed interest or even lower interest is always better than losing it all to default.


I am sure that UK would honor agreements even if no reduction were possible


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## PeteandSylv (Sep 24, 2008)

expatme said:


> In banking it is well known that those with huge loans have to be "looked after" as a default would lead to great losses to the banks. No lender wants to lose the cash lent. So an extended term with fixed interest or even lower interest is always better than losing it all to default.


Did this apply to the situation in Greece where loans were written down or Cyprus where there was a haircut?

What are your comments on my point about future loans as I'm sure you looked at the chart I mentioned and other sources?

A little more explanation about your opinions would be welcomed and help improve the discussion.

Pete


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## wizard4 (Feb 3, 2013)

And while you have all this going on in the EU, there is a very real possibility of the UK holding a referendum, on remaining in the EU. As to whether it comes about is anybody's guess, however in the worst case scenario, of it leaving the EU, as I understand it every ex-pat would then be classed as living outside the EU and therefore not entitled to have their pension!
I may be wrong about that last point, however my opinion is that it would be courting disaster if the UK pulled out.
Be interesting to hear your thoughts on this.
Cheers


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## Hudswell (May 14, 2010)

As an expat living in Cyprus then I suspect little,would change..there are a number of Double Taxation agreements in place that have nothing to do with the EU


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## Baywatch (Mar 30, 2014)

Hudswell said:


> As an expat living in Cyprus then I suspect little,would change..there are a number of Double Taxation agreements in place that have nothing to do with the EU


Still I think that pension is only paid out in full in another EU member. Double tax agreement or not. That is two different things


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## PeteandSylv (Sep 24, 2008)

wizard4 said:


> And while you have all this going on in the EU, there is a very real possibility of the UK holding a referendum, on remaining in the EU. As to whether it comes about is anybody's guess, however in the worst case scenario, of it leaving the EU, as I understand it every ex-pat would then be classed as living outside the EU and therefore not entitled to have their pension!
> I may be wrong about that last point, however my opinion is that it would be courting disaster if the UK pulled out.
> Be interesting to hear your thoughts on this.
> Cheers


I wonder if you are confusing increases in pension with actual pension. Many ex-pats, even those who have taken citizenship elsewhere are entitled to and receive their UK pension if they have made the appropriate contributions. They do not receive any increases in pension.

Pete


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## Hudswell (May 14, 2010)

No nothing to do with the EU, all these agreements were in place prior to Cyprus joining the EU..Cyprus is actually part of the Commonwealth....pensions are paid in full and subject to the index linked increase yearly...indeed it is one of the few countries where you can receive your Public Sector Pension (and your state pension of course)Tax free outside of the UK


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## Baywatch (Mar 30, 2014)

Hudswell said:


> No nothing to do with the EU, all these agreements were in place prior to Cyprus joining the EU..Cyprus is actually part of the Commonwealth....pensions are paid in full and subject to the index linked increase yearly...indeed it is one of the few countries where you can receive your Public Sector Pension (and your state pension of course)Tax free outside of the UK


Yea UK has strange rules. Otherwise the pension should be taxed in the country where you reside inside EU. I will get pension from Sweden and Germany and both will be taxed only here


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## Hudswell (May 14, 2010)

UK pensions are of course taxed in Cyprus...you choose the rate..depending on the size of the pension..either 5% on anything over 3.5k or thereabouts or the normal rate of tax..which ever is beneficial...


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## Baywatch (Mar 30, 2014)

Hudswell said:


> UK pensions are of course taxed in Cyprus...you choose the rate..depending on the size of the pension..either 5% on anything over 3.5k or thereabouts or the normal rate of tax..which ever is beneficial...


Yea that how it should be, not only in Cyprus


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## wizard4 (Feb 3, 2013)

Ladies and gentlemen please take a bow, thank you for clarifying everything, Im a happy little bunny now.
Cheers


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## zach21uk (Jun 26, 2014)

I have been watching with interest the last few days as the euro has spiralled even further down in value. Just 5 days ago it was £1 = €1.37, then I checked it at 10am this morning and £1 = €1.41 and just a moment ago it was at €1.43!

I pay my rent in euros, from a UK bank account via TransferWise. Compared to September last year, right now my rent is exactly £54 cheaper! 

I have to say though, I do feel bad right now for those that keep their money in Euros. More buying power for the pound obviously means less for the euro......


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## PeteandSylv (Sep 24, 2008)

zach21uk said:


> I have to say though, I do feel bad right now for those that keep their money in Euros. More buying power for the pound obviously means less for the euro......


If you have some money here in the bank in Euros it's buying power over here is exactly the same.

It's only items bought abroad that are affected. Anyone exchanging their money into Euros and buying items in sterling with them is daft.

Of course if it stays this way eventually imported items from non-Euro countries may see price increases but that affects everyone regardless of where their money is. In those circumstances sterling exporters may realise their goods may become too expensive reducing overall sales and adjust their prices downwards compensating. It's always a balancing act.

Pete


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## zach21uk (Jun 26, 2014)

I meant in terms of people from Euro countries visiting the UK where euros are not accepted. There euros buy a lot less pounds now than they did a few months ago.


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## Baywatch (Mar 30, 2014)

zach21uk said:


> I meant in terms of people from Euro countries visiting the UK where euros are not accepted. There euros buy a lot less pounds now than they did a few months ago.


But the export industry in the Euro countries is very pleased now. And ofc UK pensioners


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## David_&_Letitia (Jul 8, 2012)

The financial pundits predict that the exchange rate will be £1 = €1.50 by the end of the year. 

If the UK increases interest rates, this rise will be sooner rather than later...


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## Baywatch (Mar 30, 2014)

David_&_Letitia said:


> The financial pundits predict that the exchange rate will be £1 = €1.50 by the end of the year.
> 
> If the UK increases interest rates, this rise will be sooner rather than later...


I think the opinions are split. If they sort out the Greek problem, many say that the Euro will be stronger again. Because it is a week Euro problem, it is not that the usd or pound is strong. And ofc what will happen in the UK election is very important


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## David_&_Letitia (Jul 8, 2012)

Baywatch said:


> I think the opinions are split. If they sort out the Greek problem, many say that the Euro will be stronger again. Because it is a week Euro problem, it is not that the usd or pound is strong. And ofc what will happen in the UK election is very important


I agree that the Euro slide against Sterling is nothing particularly to do with the strength of Sterling, although clearly the capital flight from Greek banks seems to be going into UK and US banks! 

The focus on the slide does seem to be on Greece, but I don't think that it's now the main problem, nor has it caused the current (ie since Monday this week) slide of the Euro. This is clearly down to two factors combined with each other:

1. Poor interest rates (actually negative interest, meaning that investing money in Euro bonds will actually cost the investor money). Why would any institution want such 'investments'? Because there is always another foolish institution which will buy them at a higher (albeit still negative) interest rate. That fact brings us neatly to the next problem which has caused the current fast slide...

2. Quantitive Easing (QE). The big slides in the Euro started as the European Central Bank (or foolish institution!) started its' *€60Bn per month* purchase of bonds through QE. Whilst QE worked for the UK and the US, the Eurozone, without fiscal union, is too diverse for it to have the same effect. Investors are extremely jittery. As I said before, it is likely that when the UK increases its' interest rate (because, unlike Eurozone countries, it can!) then you will see the Euro slide even further.


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## Baywatch (Mar 30, 2014)

David_&_Letitia said:


> I agree that the Euro slide against Sterling is nothing particularly to do with the strength of Sterling, although clearly the capital flight from Greek banks seems to be going into UK and US banks!
> 
> The focus on the slide does seem to be on Greece, but I don't think that it's now the main problem, nor has it caused the current (ie since Monday this week) slide of the Euro. This is clearly down to two factors combined with each other:
> 
> ...


I would really want to see what happens IF Cameron wins the election, If the then coming referendum say UK out of EU


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## David_&_Letitia (Jul 8, 2012)

Baywatch said:


> I would really want to see what happens IF Cameron wins the election, If the then coming referendum say UK out of EU


I think that the outcome of the 2015 UK General Election is one of the hardest ever to predict.

I believe, however, that there will be another coalition, though not _*necessarily*_ Conservative/Lib Dem and almost *certainly* not Labour/SNP. It seems to me that a coalition is actually a good thing to restrain the main political parties and their extremes of policy to the far left or far right. Few politicians actually listen to what the people want - political partiy doctrine and satisfying those who fund the main parties seems to take precedence over good governance in my opinion.

As far as exit from the EU is concerned, I think that the UK electorate, if given a referendum, will do what Scotland did and vote for what they know rather than take a leap into the dark by an exit. No doubt there will be threats from the EU commissars about the consequences of leaving and this would actually sway the British people away from Europe, which has never understood our psyche (that's part of the problem of the EU).

Of course, if the EU were to reform into something more accountable and acceptable to the citizens it purports to support, then it would be worth staying, but then again there may be snow in Cyprus this August...


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## Baywatch (Mar 30, 2014)

David_&_Letitia said:


> I think that the outcome of the 2015 UK General Election is one of the hardest ever to predict.
> 
> I believe, however, that there will be another coalition, though not _*necessarily*_ Conservative/Lib Dem and almost *certainly* not Labour/SNP. It seems to me that a coalition is actually a good thing to restrain the main political parties and their extremes of policy to the far left or far right. Few politicians actually listen to what the people want - political partiy doctrine and satisfying those who fund the main parties seems to take precedence over good governance in my opinion.
> 
> ...


That hardly answered my question, what will happen with a Brexit


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## PeteandSylv (Sep 24, 2008)

I would suggest that if the UK votes to leave the EU the Prime Minister will announce something along the lines of: 

"The people have spoken and we will set about starting negotiations with the EU to leave in an orderly fashion. HM Government is determined to meet all debts and agreements and will act with customary honour at this proud time. HM Government is fully committed to the will of the people and I have asked my ministers to work very hard and report back with their progress. The first indications from the EU suggests that progress can be made quickly and that the UK can expect to complete negotiations within 5 years after which removal from the EU will take place in a phased implementation."

That should take care of the life of that parliament and allow time for pension negotiations and retirement plans to be put in place following the example of Blair.

Pete


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## wizard4 (Feb 3, 2013)

Sensible comment Pete, on a scenario that may or may not happen, certainly the electorate, and politicians would be waiting with baited breath for the result, and i fancy a lot of politicians will be having palpitations.
Currently its £1.40 to the euro.

Cheers

Ray


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## zach21uk (Jun 26, 2014)

So Greece announced the other day they cannot make their IMF payment and the euro tumbled as low as £1.00 = €1.43. 

As of right now its recovered a bit and is sitting at £1.00 = €1.41, however I expect its going to creep back towards €1.43 / €1.44 over the coming days.

If Greece actually fails to make its payment then I would expect it to tumble even more! Many think they announced this simply to provoke a renegotiation.

Works great for me at the moment as for every cent the euro looses in value, our new car (due August) gets about £250 sterling cheaper!


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## wizard4 (Feb 3, 2013)

Well we all know now Cameron got re-ellected and is currently doing the rounds of the EU member states to drum up support for his eu reforms with respect to the uk, so far its not going well for him, however i believe he will still go ahead with the referendum as he stated. Watch this space as they say.
Cheers


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## Baywatch (Mar 30, 2014)

wizard4 said:


> Well we all know now Cameron got re-ellected and is currently doing the rounds of the EU member states to drum up support for his eu reforms with respect to the uk, so far its not going well for him, however i believe he will still go ahead with the referendum as he stated. Watch this space as they say.
> Cheers


As long as Angela Merkel sits in Berlin, he will have very little success.


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## David_&_Letitia (Jul 8, 2012)

Baywatch said:


> As long as Angela Merkel sits in Berlin, he will have very little success.


I don't agree Anders.

The EU definitely needs reform and most Western European member states recognise that. 

David Cameron has been elected (within the limitations of a first past the post electoral system) with a sound majority, on a mandate of EU reform followed by an In/Out referendum. The EU cannot ignore that, and Angela Merkel has already indicated that treaty change for the UK may be possible.

Despite all their sabre rattling, the EU needs the UK:

1. We are a net contributor in financial terms. If we leave, Germany and France will have to take up the slack. They cannot afford to do so.

2. We are a major EU customer and import far more from the EU than we export. Germany certainly recognises this with Audi, Mercedes, BMW, Bosch etc all doing extremely well in the UK sales market. If we leave, contrary to popular opinion, the EU manufacturers will still be seeking UK customers. If we leave, we will find that Ford, Nissan, Toyota etc will be far more competitive to "woo" us with their wares and less EU regulation to prevent it.

3. The UK decision to refuse to join the Monetary Union when it started has been vindicated over and over again. The Euro is a failed experiment and desperately needs to be fixed if member states are to retain any level of sovereignty. The situation in Eurozone countries like Greece, Cyprus, Ireland, Portugal and Spain is an indication that the EU is pulling the financial strings and imposing failed policies through dogma rather than fiscal common sense.

4. The UK is the fifth largest economy in the world after U.S., China, Japan and Germany. The EU will ignore that at their peril.

5. The EU will be weaker if they lose a major player like the UK which is a nuclear power with a permanent seat at the UN Security Council. Despite our reduction in defence spending, we are still able to project power world-wide, unlike 93% of the rest of the EU.

6. We are a strong nation with a prod history which, unlike the majority of the EU has not been invaded for nearly 1,000 years and has not flirted with Fascism or Communism. We also successfully stood alone against overwhelming odds before - two World Wars bear testimony to that. The EU cannot ignore us as insignificant on the world stage.

I do not believe that we are looking for anything which cannot easily be given to us. For starters:

1. We have a welfare state system and National Health Service to be extremely proud of, but they are being abused by economic migrants using the EU open borders principle. This must change.

2. We do not want political union with the EU which seems to be the underlying agenda. We are a sovereign State and wish to stay that way. I voted in favour of a "common market" in the 1975 referendum. I did not vote for a "United States of Europe" which is the direction we are heading.

3. We want our Supreme Courts to be the final arbiter in UK matters of law and order. Not the European Courts. We are able to administer our own justice - after all, we have been doing it for longer than all the EU member states!

This is not jingoism or xenophobia. It is what made us *Great* Britain.


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## Veronica (Apr 5, 2008)

Baywatch said:


> As long as Angela Merkel sits in Berlin, he will have very little success.


Angela Merkel has made it clear she does not want Britain to leave the EU. 
I think that there will be some compromises made to us from leaving.


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## Baywatch (Mar 30, 2014)

Veronica said:


> Angela Merkel has made it clear she does not want Britain to leave the EU.
> I think that there will be some compromises made to us from leaving.


David Cameron has also made clear he dont want to leave, so we will see who is the strongest


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## David_&_Letitia (Jul 8, 2012)

Baywatch said:


> David Cameron has also made clear he dont want to leave, so we will see who is the strongest


That doesn't make sense. If David Cameron doesn't want to leave (as long as he gets reforms) and Angela Merkel doesn't want the UK to leave (and is willing to discuss reforms) then what has "the strongest" got to do with anything?


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## PeteandSylv (Sep 24, 2008)

wizard4 said:


> .... so far its not going well for him, ......


I'm not sure my reading of this report gives the same impression.

Cameron's EU 'whistle-stop' tour: Mission accomplished? - BBC News

Pete


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## Baywatch (Mar 30, 2014)

PeteandSylv said:


> I'm not sure my reading of this report gives the same impression.
> 
> Cameron's EU 'whistle-stop' tour: Mission accomplished? - BBC News
> 
> Pete


I am sure they can compromise on many things but as I understand it the biggest issue for Cameron is the free movement inside EU. One of the cornerstones and it will never be negotiable. 

What I don*t understand is why UK is so soft with the benefit rules. No other EU country allow EU migrants to come and just start on benefits. Sweden, Germany and all others I know is stone hard. If you can*t support yourself when you come, you will not get any permission to stay.

Lets take an example. Many Romanian Gypsies come to Sweden. The are forced to beg for a living, they dont get housing or benefits. 

If this is possible in Sweden Germany Denmark, why not in UK. I cant see it as a EU problem, it is a UK problem


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## Veronica (Apr 5, 2008)

I agree with you on this point Anders. It is the biggest problem and it is high time that the UK stopped being so soft and followed the example of other EU countries on the issue of benefits.


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## zach21uk (Jun 26, 2014)

Well, after hitting 7 years lows yesterday against the pound, where the value fell to £1.00 = €1.43547, the value of the euro has continued to fall today, hitting as low as £1.00 = €1.43985 a couple of hours ago today.

Its recovered slightly now to 1.43863, but the overall trend this week has been a steady decline in the value.

On Monday, £1.00 was around €1.3950 euros, so it has lost over 3 cents this week.

The euro has not been this low since _October 11th 2007_ according to the graphs on XE.com.

Not sure how much longer this decline will continue, but for those of us with large amounts of money in sterling, its certainly working in our favor right now!


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## Veronica (Apr 5, 2008)

We got 1.41 on Tuesday. Who could predict that if we had waited a couple of days we would have got 1.43. Thats pretty typical for us


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## zach21uk (Jun 26, 2014)

Its leaving me guessing about when to transfer the money to pay for our new car in August. We're talking 26k+ euros here, so when the euro looses 1 cent in value, our car gets about £200 pounds sterling cheaper! Do I do it now? Do I wait a week and see if it drops to 1.44 or 1.45, or maybe it will stengthen to 1.42 or 1.41 :O :O Decisions decisions...........


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## Baywatch (Mar 30, 2014)

zach21uk said:


> Its leaving me guessing about when to transfer the money to pay for our new car in August. We're talking 26,000 euros here, so when the euro looses 1 cent in value, our car gets about £200 pounds sterling cheaper! Do I do it now? Do I wait a week and see if it drops to 1.44 or 1.45, or maybe it will stengthen to 1.42 or 1.41 :O :O Decisions decisions...........


That is a decision the currency traders have to take many times per day


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## zach21uk (Jun 26, 2014)

Baywatch said:


> That is a decision the currency traders have to take many times per day


I know! I would hate being a currency trader LOL!

I would end up raging all the time


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## PeteandSylv (Sep 24, 2008)

Veronica said:


> We got 1.41 on Tuesday. Who could predict that if we had waited a couple of days we would have got 1.43. Thats pretty typical for us


Always be happy with the deal you thought was the right one at the time or you'll never be content or get free drinks!

Pete


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## madcow (Jan 10, 2010)

I must admit we took advantage of the 1.43 cherry , it's like the old days when we used to get interest . Something for nothing is always apealing .


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## zach21uk (Jun 26, 2014)

Its now sitting at £1.00 = €1.44083 after hitting a high a little while ago of €1.44123

Not sure, but I think trading has stopped now for the weekend, so it should stay at this amount until Monday.

I wonder how much further this decline will go!


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