cyprusgrump wrote:Lordo wrote:cyprusgrump wrote:Lordo wrote:for too long america has controled the world. it is time to stop using the dollar. euro is a better currency.
Hahahahaha!
You're delusional...
If the €uro is such a good currency, perhaps you can explain why my bank has just written to me stating that their interest rate on €uro accounts is now -0.5%?
Negative interest rates on €uro accounts! What a strong currency it is!
thats very interesting. you clearly have not got the foggiest about finace.
accroding to you the terggish lira is the best at 19% interest rates. lets all use terggish liras. i am off to the bank to change my money all 20 pounds of it in one go.
So both you and Erolz think that the ECB setting interest rates negative to desperately try and stimulate the economies of the €urozone is a sign of strength, not weakness...?
Strength or weakness of a currency is measured relative to other currencies.
The euro is relatively strong vs the GBP but weaker against the USD. The key word is relative and over what time frame. Are you able to buy more or less units when you exchange?
Interest rates are a means or tool used by central banks to control the economy. Low interest rates encourage loans. high interest rates encourage savings. That is it.
The Bank of Japan is renowned for setting really low interest rates as is Switzerland. Both of them are outperforming the USD that has a higher interest rate. The Swiss Franc is consider a safe haven currency and the Yen is starting to gain such status as well.
Basically, if you want to hedge yourself against currency devaluations. you pay or sacrifice a higher interest rate to potentially gain capital appreciation. This only applies if you are moving money around and exchanging between currencies to avoid risk.
So, you might have a negative interest rate on Euro deposits, but how much would you lose if you held Turkish Lira or British pounds these past five years..
