Benjamin Posted December 27, 2007 Share Posted December 27, 2007 groslard wrote Not quite accurate, since the Euro didn't exist, and the UK might have joined it.So the Franc and Sterling enjoyed a perfectly stable exchange rate then? Link to comment Share on other sites More sharing options...
Owen Posted December 27, 2007 Share Posted December 27, 2007 Hello Groslard,If financial journalists were that good they would be making fortunes for themseves instead of scribbling.They may be right of course but at these levels, £/1.37 €, any spare money on deposit in Euros being switched to sterling may be a reasonable risk. Very tempting!RegardsOwen Link to comment Share on other sites More sharing options...
John L Posted December 28, 2007 Share Posted December 28, 2007 [quote user="groslard"]This shows the problem graphically:http://www.x-rates.com/d/EUR/GBP/hist2007.html[/quote]Useful site. But looking at the other currencies there gives a better overall picture of currency movements. Link to comment Share on other sites More sharing options...
Logan Posted January 2, 2008 Share Posted January 2, 2008 When you evaluate your loss if any due to the Sterling/Euro exchange rate you should calculate values annually or even over the economic cyclical cycle. By that I mean 5 to 7 years. You will probably find that actually Sterling and therefore in essence your income holds its value internationally very well. Although currently Sterling is historically quite low against the Euro so is the Dollar and most other currencies. I advise investors/pensioners to hold their nerve and remain in Sterling if you can or even buy. You will be sitting well when the wind of change blows in the other direction. It always does eventually. Think medium to long term not short. Link to comment Share on other sites More sharing options...
groslard Posted January 2, 2008 Author Share Posted January 2, 2008 Unfortunately I have bills to pay, so medium to long term is not of much interest... Link to comment Share on other sites More sharing options...
Owen Posted January 4, 2008 Share Posted January 4, 2008 Hello,I for one could not resist temptation any longer at £1/1.3395€ and bought a few quid this morning.RegardsOwen Link to comment Share on other sites More sharing options...
MrCanary Posted January 9, 2008 Share Posted January 9, 2008 Good move Owen - I was thinking of thinning out my French bank account and buying pounds right now, hopefully to transfer it back to euros later in the year. Whatever you do, it is all a bit of a gamble! Link to comment Share on other sites More sharing options...
groslard Posted January 9, 2008 Author Share Posted January 9, 2008 [quote user="Tram"]Good move Owen - I was thinking of thinning out my French bank account and buying pounds right now, hopefully to transfer it back to euros later in the year. Whatever you do, it is all a bit of a gamble![/quote]Anyone else want to thin out their Franch bank account?..Send me a few thousand Euros and I'll pay you back later; I may be some time [:)] Link to comment Share on other sites More sharing options...
Alan Zoff Posted January 9, 2008 Share Posted January 9, 2008 This brings to mind the advice of a lecturer on a financial planning course I attended many years ago.He told us that speculating on currency movements was one of the highest risk "investments" around and that, unless you could afford to lose heavily, leave currency gambling to the City boys. For general transactions, the recommended course was always to match a liability to the currency in which the liability was payable. (Similar to banks and building societies having to match liabilities - that is, before someone decided it would be a good idea to let them chuck away the rule book...)I guess the same holds good today so, unless you can afford to gamble, before you commit yourself to a substantial euro liability (e.g. sign the contract on your French house purchase), make sure you are holding the required sum in euros. Don't defer conversion until you have to make the payment. Link to comment Share on other sites More sharing options...
Logan Posted January 9, 2008 Share Posted January 9, 2008 [quote user="Alan Zoff"]I guess the same holds good today so, unless you can afford to gamble, before you commit yourself to a substantial euro liability (e.g. sign the contract on your French house purchase), make sure you are holding the required sum in euros. Don't defer conversion until you have to make the payment.[/quote]French property bought in Sterling right now is not a wise move. Far better buy yourself a nice house in Florida. I have been searching the market there and there are some great buys with Euros against the Dollar. The sub-prime chaos is causing a distressed sale sell off. I am waiting for the Euro to hit 1.50 to the dollar. Then it's Florida for me for my future winters. [:)] Link to comment Share on other sites More sharing options...
cooperlola Posted January 9, 2008 Share Posted January 9, 2008 Florida! Bloomin' eck, I'd rather live in a hut over here. Sorry Floridians but having been there for the first time last year, I was singularly unimpressed - not by the people, but by the landscape. Link to comment Share on other sites More sharing options...
Logan Posted January 9, 2008 Share Posted January 9, 2008 [quote user="cooperlola"]Florida! Bloomin' eck, I'd rather live in a hut over here. Sorry Floridians but having been there for the first time last year, I was singularly unimpressed - not by the people, but by the landscape. [/quote]I don't want to live there Coops. I want to find somewhere new for 3 months in the winter. I usually go to Spain but it's getting a bit clapped out. Florida's investment potential right now looks very positive. Link to comment Share on other sites More sharing options...
jon Posted January 9, 2008 Share Posted January 9, 2008 The rtirling is set to carrry-on falling against the euro as the mortgage interest rates are cur further.....apparently.This is bad news for so many people Link to comment Share on other sites More sharing options...
jon Posted January 9, 2008 Share Posted January 9, 2008 The stirling is set to carrry-on falling against the euro as the mortgage interest rates are cur further.....apparently.This is bad news for so many people Link to comment Share on other sites More sharing options...
Sprogster Posted January 9, 2008 Share Posted January 9, 2008 Logan,If you buy a property in Florida make sure you acquire it in the name of a non US Company, to avoid horrendous Federal Inheritance Tax/Death Duty liabilities.The American Government in its wisdom whilst increasing their inheritance threshold over the years for US Citizens and Permanent Residents, did not apply the threshold increases to foreign US property owners. As a result a Brit owning a US property in their own name only has a US$60,000.00 (Sixty Thousand!) allowance and if they die the US property will be taxed at up to sixty per cent of its market value and there is no exemption on transfers between foreign spouses. Although, there might be double taxation treaty offset with your home country, that is no good if you have not incurred a liability in your home country if it is below the threshhold there, or at a higher rate.Anyway the good news is that the liability is easily and legally circumvented by foreigners owning US property through non US companies, which the US authorities are quite happy with and there are no fiscal penalties for doing so, unlike France.Last but not least, be aware that as Florida has no state income tax, property taxes are very high and depending on the county average between 1.75% and 2.00% of the annual assessed market value of the property. Insurance costs have also gone through the roof in the last couple of years because of the perceived increased hurricane risk with global warning.I sold my Florida property and bought in the VAR instead and although you do not get the mild winter weather of Florida, the annual running costs are about one quarter of France. Link to comment Share on other sites More sharing options...
WJT Posted January 9, 2008 Share Posted January 9, 2008 Sprogster, did you mean that the annual running costs are a quarter in France? If so, I do find that incredible because I would have thought the opposite.I'm with Coops though, personally I don't particularly like Florida, in fact some areas I think are pretty ugly. Having said that, Florida is probably about the size of the UK so varies quite a bit, for example, from the Northern Panhandle down to the Keys of which I think is very nice, albeit flat.It is funny how some of the Sky satellite channels showing real estate are targeting Brits for US property. I watched a program in amazement the other week trying to sell properties to Brits in the Smokies. [:D]Back on subject, obviously, I don't know how the money markets work, but I just don't understand the comments about interest rates effecting the Pound versus the Euro. If higher interest rates were the main factor it would seem that the Euro would be weaker than the Pound. [8-)] Link to comment Share on other sites More sharing options...
jon Posted January 10, 2008 Share Posted January 10, 2008 Probably badly put...but the euro has got a lot stronger over the last few months ...so when we buy euros with sterling it is worth less....if I can remember back it probably really started in Aug when it may have been 142. and it is now aroun 133 something.Aparently there are many factors which assist in the sstrength of the pound.As we can see there is little confidence in the leadership of UK and its generall well being.The property market is saking[except for London]apparently, retail trade does not look to bright and share markets have been better.Somebody pointed out that the UK has a reputaion of being a great country with its vivid shopping empire, theatres, museums and broad outlook on culture Wheras France has never claimed to mighty. Link to comment Share on other sites More sharing options...
Logan Posted January 10, 2008 Share Posted January 10, 2008 [quote user="Sprogster"] Logan,If you buy a property in Florida make sure you acquire it in the name of a non US Company, to avoid horrendous Federal Inheritance Tax/Death Duty liabilities.[/quote]Thank you Sprogster for your post. I knew about the need for an off shore company. I also agree some of the costs you mention are quite high. The worst of these personally is medical insurance. However you need to assess the likely capital gain in the future and the winter benefits which may make it justifiable. I am not so bothered about the quality or otherwise of the landscape. I simply seek a warm dry winter climate on the coast, principally for heath reasons. How did you find the rental market worked with your property?WJT.Interest rates effect the way currency is traded internationally. The euro is high right now because Trichet continually states he will not reduce eurozone rates whilst there is an inflation risk. Since that risk is increasing, investors in euros can be sure the value will keep up in the medium term. The UK central bank on the other hand sends messages they need to cut rates because of market conditions and the credit crunch. Link to comment Share on other sites More sharing options...
WJT Posted January 10, 2008 Share Posted January 10, 2008 Thanks Logan and Jon, that makes sense, even though it isn't what I want to hear. It looks like the pound won't be recovering anytime soon. [:(]Logan, some people love the tropical flat landscape in Florida such as the beauty of the everglades, forests and huge national parks, not to mention the snow white gorgeous beaches that are abundant there. In fact, it is starting to sound better and better. [:D] Please let us know where you decide to buy.[:)] Link to comment Share on other sites More sharing options...
plod Posted January 10, 2008 Share Posted January 10, 2008 It's still worrying to see your pension reduced - I'm 180 euros worse off this month compared to September. Link to comment Share on other sites More sharing options...
cooperlola Posted January 10, 2008 Share Posted January 10, 2008 [quote user="plod"]It's still worrying to see your pension reduced - I'm 180 euros worse off this month compared to September.[/quote]Too true. Happily, I have been in the process of a massive belt-tightening exercise anyway as I assumed I'd be buying PHI by now! However, it's always been a factor to condider, as said above. Always wise in our situation to live about 10% or so below your means, just in case! Link to comment Share on other sites More sharing options...
Benjamin Posted January 10, 2008 Share Posted January 10, 2008 [quote user="cooperlola"][quote user="plod"]It's still worrying to see your pension reduced - I'm 180 euros worse off this month compared to September.[/quote]Too true. Happily, I have been in the process of a massive belt-tightening exercise anyway as I assumed I'd be buying PHI by now! However, it's always been a factor to condider, as said above. Always wise in our situation to live about 10% or so below your means, just in case![/quote]Taking the current rate of 1.3283 shown on Reuter's, website that represents a reduction of over 8% against the average rate of 1.45 I achieved on Sterling to €uro transfers in 2007.It's getting close Cooperlola to your magic 10% which in anyone's book would have been considered a very prudent figure to use. Link to comment Share on other sites More sharing options...
cooperlola Posted January 10, 2008 Share Posted January 10, 2008 True, Benjamin, however with a 10% "contingency" at least it's not so stressful as it is for those who are unlucky enough not to have any slack in their budgets. I never imagined that I would be so grateful to the BR pension fund and its prudent management as I am these days. Link to comment Share on other sites More sharing options...
Benjamin Posted January 10, 2008 Share Posted January 10, 2008 Looking on the brighter side [:)] if these rates remain through 2008 we'll all be declaring/paying less in tax in 2009. Link to comment Share on other sites More sharing options...
cooperlola Posted January 10, 2008 Share Posted January 10, 2008 I have no doubt though, Benjamin, that the "official" exchange rate for tax returns will in no way reflect reality, once again. However, last year, I declared the precise value in Euros of my salary as it was paid over here and nobody has ever queried it. I shall be doing the same again this year.....[Www] Link to comment Share on other sites More sharing options...
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