The Big Bailout of the Eurozone (Another crisis coming? - Seriously)

[orangeman]

Four years ago, fearful of a property crash, David and Maureen Somers sold their house and bought gold. It's a tactic suddenly popular with those seeking a safe haven for their money.

As safe as houses. This piece of perceived wisdom no longer seems quite so wise as property prices fall and stocks stutter.

But there is one area of the global financial machine that is revving up - gold.

When times are bad, investors have traditionally sought refuge in this precious metal. With bullion dealers reporting a surge in business, it seems history is repeating itself.

Prices are strong and David Somers is delighted, because he effectively bet his house on it. The retired croupier sold his house in 2004 and invested the proceeds in gold.  GOLD PRICES
1999: Prices lowest in 20 years after Gordon Brown urged Bank of England to sell half its reserves
These were sold in 17 auctions between 1999 and 2002 for average of $275.6 an ounce
Currently about $900 an ounce
In March it surged through $1,000 mark for first time


Gold fever

"I was worried about the health of the financial markets at that time, I was worried that something like this credit crunch could be on the way," he says.

"The fact that at the time, only £35,000 of savings in a bank or building society were secure worried me, and I spent a lot of time doing research into what to do. Gold seemed to the best place."

The 56-year-old had seen his friends suffer badly in the last recession through negative equity, punishing repayments, bankruptcy and repossession.

"I looked at my friends and saw that their prime capital earning years were effectively taken away from them because of the way the system had been working."

Alchemy

Mr Somers and his wife Maureen claim it would be "vulgar" to say how much they invested in gold. However, he does say they sold their three-bedroom, detached house in Poole for a significant profit, and the couple have since almost doubled their money again in gold.  GOLD AND TAX

It's a commodity, so subject to capital gains tax, less expenses
Mr Somers buys and sells gold each year to take advantage of capital gains tax allowance
This also helps increase his overall gold holding

"Over thousands of years gold has never reached zero. The price is a risk, but at the end of the day I will still have the same amount of gold," he says.

"There are people who probably hold bank shares that would have been seen as conservative investments and you could question what they are going to be left with."

Mr Somers has never touched the gold he owns, but is able to track its value online.

"It's in a secure vault and I'm really quite happy that they don't let people in to look at it or fondle it. That said, we have stroked the computer screen when we've seen the price go up."

If the couple need money they simply sell some of their gold - it can be sold by the gram, currently about £16 - and the funds are deposited in their bank account the following day.

Commission fees are typically less than half of a percent, and insurance against theft is also a nominal amount.

The couple now live in rental accommodation in Somerset, although Mr Somers hopes to buy property again once prices drop further.

Bunker mentality

Other investors are now following suit, with bullion dealers reporting a sudden upswing in business.

Bullion Vault is an online gold broker in west London, which allows clients to buy and sell certified gold held in vaults in London, Zurich and New York.

It is currently opening an average of three times as many accounts a day compared with the start of September.

Founder Paul Tustain says the appeal of gold is its ability to hold its value over time, and it measures up well against inflation.

"There is a story told about a Roman emperor who bought a suit of clothes thousands of years ago with an ounce of gold. Today that same ounce would be worth about $900, and that would again pay for a suit of clothes," he says.

Mr Tustain stresses that gold is a long-term investment that comes into its own when times are bad, like the Great Depression and during the stagflation of the 1970s.

And Mr Somers, for one, is glad he turned bricks and mortar into gold. "What's happening at the moment is like a financial blitz, and I feel like gold is my tin hat at this time. I wouldn't want to be in a bombed-out economy without it."

[orangeman]

Somebody was on here earlier talking about martial law - they weren't joking either.
There have been riots on the streets of Hong Kong following heavy losses at the city's Hang Seng index.

The Hang Seng closed over 8% lower with losses in banks, communications companies and exploration companies.

Customers are trying to get their money out of bank branches and many are protesting about losses related to the collapse of Lehman Brothers.

AdvertisementEarlier, trading on the stock exchange in Jakarta was halted because today's falls were so severe.

[muppet]

ISEQ down almost 6% now and the FTSE by almost 5%. Anyone got another trick they'd like to try?

I say write off all debts, mortgages, credit card etc and start again.

That would be wonderful.

However take note that despite all the bailouts, multi-billion guarantees and tearing up of strategies/laws not a single euro has been earmarked anywhere for the reduction of even one ordinary punter's debt.

Regardless of what happens our mortgages and other liabilities will still stand even if we enter the dreaded negative equity.

I think any national bailout or national guarantee that is accepted by a financial institution should trigger a writedown of a percentage the monies owed to it by any citizen of that country. E.G if Lloyd's accept assistance from the crown between certain thresholds, then all citizens of the crown owing money to Lloyds have their debt reduced by 10% or 20% or whatever.

There has to be something in it for the ordinary taxpayer other than shouldering the burden created by the wreckless lending of our banks.

[Gnevin]

ISEQ down almost 6% now and the FTSE by almost 5%. Anyone got another trick they'd like to try?

I say write off all debts, mortgages, credit card etc and start again.

That would be wonderful.

However take note that despite all the bailouts, multi-billion guarantees and tearing up of strategies/laws not a single euro has been earmarked anywhere for the reduction of even one ordinary punter's debt.

Regardless of what happens our mortgages and other liabilities will still stand even if we enter the dreaded negative equity.

I think any national bailout or national guarantee that is accepted by a financial institution should trigger a writedown of a percentage the monies owed to it by any citizen of that country. E.G if Lloyd's accept assistance from the crown between certain thresholds, then all citizens of the crown owing money to Lloyds have their debt reduced by 10% or 20% or whatever.

There has to be something in it for the ordinary taxpayer other than shouldering the burden created by the wreckless lending of our banks.

A write down is the same as toxic debt thus it would be a cycle lloyd's need money but no one will lend so the UK govt props them up but wipes 20% of the value off the good debts they have leading back to square one

[muppet]

ISEQ down almost 6% now and the FTSE by almost 5%. Anyone got another trick they'd like to try?

I say write off all debts, mortgages, credit card etc and start again.

That would be wonderful.

However take note that despite all the bailouts, multi-billion guarantees and tearing up of strategies/laws not a single euro has been earmarked anywhere for the reduction of even one ordinary punter's debt.

Regardless of what happens our mortgages and other liabilities will still stand even if we enter the dreaded negative equity.

I think any national bailout or national guarantee that is accepted by a financial institution should trigger a writedown of a percentage the monies owed to it by any citizen of that country. E.G if Lloyd's accept assistance from the crown between certain thresholds, then all citizens of the crown owing money to Lloyds have their debt reduced by 10% or 20% or whatever.

There has to be something in it for the ordinary taxpayer other than shouldering the burden created by the wreckless lending of our banks.

A write down is the same as toxic debt thus it would be a cycle lloyd's need money but no one will lend so the UK govt props them up but wipes 20% of the value off the good debts they have leading back to square one

The way things are heading in a few weeks there will be no such thing as good debts.

[Gnevin]

Where the f**k is all the bail out cash coming from? Surely this is more virtual money ? Is it time to return to the gold standard?

[orangeman]

Where the f**k is all the bail out cash coming from? Surely this is more virtual money ? Is it time to return to the gold standard?

European Central Bank

[Gnevin]

Where the f**k is all the bail out cash coming from? Surely this is more virtual money ? Is it time to return to the gold standard?

European Central Bank

Surely they or the Fed don't have trillions of Euro/Dollars just lying around

[muppet]

Where the f**k is all the bail out cash coming from? Surely this is more virtual money ? Is it time to return to the gold standard?

European Central Bank

Surely they or the Fed don't have trillions of Euro/Dollars just lying around

The Fed merely prints some more dollars when they need them. That is part of the problem. Actually I should say that when the Republicans are in power the Fed prints more dollars, for example that is how they paid for Iraq.

Maybe the EU will do the same?

[Gnevin]

Where the f**k is all the bail out cash coming from? Surely this is more virtual money ? Is it time to return to the gold standard?

European Central Bank

Surely they or the Fed don't have trillions of Euro/Dollars just lying around

The Fed merely prints some more dollars when they need them. That is part of the problem. Actually I should say that when the Republicans are in power the Fed prints more dollars, for example that is how they paid for Iraq.

Maybe the EU will do the same?

And wouldn't a return the gold standard stop this?

[muppet]

Where the f**k is all the bail out cash coming from? Surely this is more virtual money ? Is it time to return to the gold standard?

European Central Bank

Surely they or the Fed don't have trillions of Euro/Dollars just lying around

The Fed merely prints some more dollars when they need them. That is part of the problem. Actually I should say that when the Republicans are in power the Fed prints more dollars, for example that is how they paid for Iraq.

Maybe the EU will do the same?

And wouldn't a return the gold standard stop this?

Yes it would but the Fed would be bankrupt, which mightn't help what's going on at the moment.

[Gnevin]

Where the f**k is all the bail out cash coming from? Surely this is more virtual money ? Is it time to return to the gold standard?

European Central Bank

Surely they or the Fed don't have trillions of Euro/Dollars just lying around

The Fed merely prints some more dollars when they need them. That is part of the problem. Actually I should say that when the Republicans are in power the Fed prints more dollars, for example that is how they paid for Iraq.

Maybe the EU will do the same?

And wouldn't a return the gold standard stop this?

Yes it would but the Fed would be bankrupt, which mightn't help what's going on at the moment.

f**king shambles, if some third world country did this you'd say typical but US and EU .

[orangeman]

Extraordinary times require extraordinary solutions.

[boojangles]

folks, perhaps slightly of topic but could any of ye explain to me the easiest way to buy shares in a company?
And any useful websites

Cheers

I think Goodbody are share brokers or can definetely put you in the right direction.Reuters website is also an excellent guide to look at before buying any stocks or shares.Updates by the minute.
Commodities like Gold,Silver,Diamonds etc looks like the way to go

[muppet]

Where the f**k is all the bail out cash coming from? Surely this is more virtual money ? Is it time to return to the gold standard?

European Central Bank

Surely they or the Fed don't have trillions of Euro/Dollars just lying around

The Fed merely prints some more dollars when they need them. That is part of the problem. Actually I should say that when the Republicans are in power the Fed prints more dollars, for example that is how they paid for Iraq.

Maybe the EU will do the same?

And wouldn't a return the gold standard stop this?

Yes it would but the Fed would be bankrupt, which mightn't help what's going on at the moment.

f**king shambles, if some third world country did this you'd say typical but US and EU .

In fairness I don't think the EU have done it yet.

The Republicans do it as a plan.

1. Get munitions, logistics, oil and transport companies (Boeing, Lookheed, Northrop) to make donations.
2. Get your muppet elected.
3. Start a war, preferably one that enhances control of oil reserves.
4. Print money to pay for it.
5. Award contracts associated with before, during and after the war to as many of the companies in line 1. above as possible.
6. Start again.

Up to now it was thought that as long as the dollar is the currency for trading oil, printing extra dollars would have little impact. But now.........who knows?