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The GrExit : Euro notes : German = X / Greece = Y - What notes should you be holding during crisis?

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posted on May, 19 2012 @ 07:22 AM
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So you think that hiding money under your mattress is a safe option. If you were in Greece what should you be doing?

There has been a lot of talk in the last few days regarding Bank Runs and Cash withdrawals in Greece and now Spain. Where is this money going? Some say to Russian banks (see end of post) others say under the mattress.

Lets take a quick look at the Euro notes in circulation en.wikipedia.org...

German Euros carry the X, Greek Euros carry the Y.

Let us assume that Greece WILL be exiting the Chocco Zone in the near future. This is not such a far out idea based on this reuters report:


(Reuters) - De La Rue (DLAR.L) has drawn up contingency plans to print drachma banknotes should Greece exit the euro and approach the British money printer, an industry source told Reuters on Friday.


uk.reuters.com...

So, what if you have hidden all "Y" notes for safety as you don't trust the banks. Is this a safe option if they convert to Drachma?

Would they be valued LESS than the "X" notes from Germany / Other Euro members notes?

I expect there is more to this than meets the eye...


Cash flooded into Britain; more than 140 billion euros was deposited in four big banks alone. The UK benefits from its position outside the euro zone and its Asia-focused banks HSBC (HSBA.L) and Standard Chartered (STAN.L) are seen as particular safe-havens.

Other banks to see big inflows included Barclays (BARC.L), Germany's Deutsche Bank (DBKGn.DE), Switzerland's Credit Suisse (CSGN.VX) and UBS (UBSN.VX) and Russia's Sberbank (SBER.MM) and VTB (VTBR.MM).

www.reuters.com...
edit on 19-5-2012 by komp_uk because: (no reason given)




posted on May, 19 2012 @ 07:35 AM
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If I were in Greece, I would put my euros into junk silver. Then I could buy drachmas with the silver as needed.



posted on May, 19 2012 @ 07:44 AM
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The people are taking out their Euros because not if, but when, Greece exits all the Euros in the banks will be converted to Drachmas and it's estimated the first day Drachmas will lose %50 of their value. So of course I would take out any Euros I had so I could still afford living expenses because Drachmas will not have any real buying power. How this plays out for the other countries in the Euro area is unknown but hinted at the same will happen once the floodgates open. Good short term news for the US is lower mortages, I'm still trying to figure out how that works, and a stronger US dollar, although the index closed friday at around 81 falling .44



posted on May, 19 2012 @ 07:47 AM
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Originally posted by DarthMuerte
If I were in Greece, I would put my euros into junk silver. Then I could buy drachmas with the silver as needed.


Of course metals could be an ideal place to store wealth, Gold has been holding it's line over the last few days after a bit of a drop over recent months.

It would be good if ATS Greek memebers could have a look at their notes from the ATM and see what they majority of "Y" notes the machine spits out. It seems "X" notes are coming through thick and fast based on a bit of googling.



posted on May, 19 2012 @ 07:50 AM
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Originally posted by AMANNAMEDQUEST
The people are taking out their Euros because not if, but when, Greece exits all the Euros in the banks will be converted to Drachmas and it's estimated the first day Drachmas will lose %50 of their value. So of course I would take out any Euros I had so I could still afford living expenses because Drachmas will not have any real buying power. How this plays out for the other countries in the Euro area is unknown but hinted at the same will happen once the floodgates open. Good short term news for the US is lower mortages, I'm still trying to figure out how that works, and a stronger US dollar, although the index closed friday at around 81 falling .44


Do you think the "X" or other non "Y" notes will convert to a better Drachma rate? Those with "Y" notes may well not get what they hoped.

Cheap mortgages will not stay that way for long, that is the problem. What looks cheap now may not be in a year. Some say if Greece exits the Eurozone then interest rates could shoot to 9% across the board.. I know that would be suicidal but it is a possibility.



posted on May, 19 2012 @ 07:57 AM
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reply to post by komp_uk
 


I'm not sure. Would it matter if it were x or y? Shouldn't they have the same value which was the reason for having a single currency? Unless they wanted to "buy" up all the y euros just to get them off the market and not have to convert their own. I have even read that some were thinking of stamping Drachma symbol onto existing Euros or something. I guess only time will tell how this plays out as it's sorta unprecedented. Anyone who thinks they can make a prediction on the direction based on history are fooling themselves. Each event has it's own circumstances and outcomes. We can make a guess but this time it's different, there's just so much interconnected.



posted on May, 19 2012 @ 08:02 AM
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Originally posted by AMANNAMEDQUEST
reply to post by komp_uk
 


I'm not sure. Would it matter if it were x or y? Shouldn't they have the same value which was the reason for having a single currency? Unless they wanted to "buy" up all the y euros just to get them off the market and not have to convert their own. ..snip..


I have been doing some searching and come across this site (although it is a blog along with a "mole")


The Commission mole has ‘confirmed’ that the process is designed to ensure minimal numbers of ‘Y’ designated Greek notes are in circulation, in order to reduce refusal to accept them outside Greece to a bare minimum “as and when the Greeks exit the eurozone”.


hat4uk.wordpress.com...[edi tby]edit on 19-5-2012 by komp_uk because: (no reason given)



posted on May, 19 2012 @ 10:02 AM
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ooo the denials... overnight...


Greek officials said Chancellor Angela Merkel had suggested Greece could hold a referendum on the euro when it votes in national elections next month.

However their German counterparts denied she had made such a proposal.


BBC Link



posted on May, 20 2012 @ 04:54 PM
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Interesting language from the FT




.....is the fact that the eurozone is not a single nation state, even though it does have a single central bank. This has two consequences. First, the underlying fear of depositors in the periphery is not simply, or even mainly, one of bank failure. Instead, they probably fear the devaluation of their deposits relative to those in core economies if the euro should break up.

Therefore, the run is being caused by concerns about exchange rate risk, not necessarily by the fear of bank failure as such. This makes it much more complicated to deal with, since it is very difficult to offer guarantees against future exchange rate losses to today’s depositors. Germany would not want to stand behind such guarantees to Greek and Spanish citizens in the event of a euro break-up.



blogs.ft.com...



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