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Possible currency controls on US-based banks, what about Nica-banks?
Submitted by webtrainer on Tue, 2008/04/22 - 17:50.
Just throwing something out there . . .
USA and most of the rest of the rest of the world are in or soon will be in recession. The dollar is in crisis.
possibly/probably to get worse, some saying it could get much worse.
In Argentina around 2000, when they had a currency crisis, severely limited access to funds . . . allowing only minor sums of cash to be withdrawn.
US banks may have to do the same. (At some point, people realize that they need to turn dollars into a currency with value, and there will be runs on banks.)
Now for the question(s) . . . Is there a situation when you would feel better having your cash and savings in a Nicaragua bank than a US-based bank?
Would there be less or more likelihood of severe currency controls being imposed in Nicaragua?
I posted the same kind of
I posted the same kind of question about 2 months ago and got no response. I've been moving dollars into euros for over a year and have done very well on the devaluation of the dollar. Plus, i'm getting 7.1% interest ona simple passbook savings account in my bank in europe.
i'm a usa/european dual citizen and have found it difficult to open non-resident bank accounts in european banks because of US money laundering laws (i'm not laundering anything, just lawfully saving for retirement). I recently opened one new account with a Laser/Cirrus card for withdrawals and it took 10 weeks by mail. I still don't have my online PIN # and ID.
personally, i feel the US dollar and real estate have a long way yet to slide and there's instability in both usa and european banks. one thing about the euro, so far so good but, it's the currency of a non-existent nation. i wouldn't seriously consider cordobas or nica banking.
In what currency?
If you are talking about dollars in Nicaraguan banks, they will likely be victim to the same controls. Cordobas may not be subject to control but, of course, they are only useful in Nicaragua.
Of course, if the U.S. starts putting currency controls into effect, it will cost them bigtime. The U.S.$ is the de facto world currency. If it can't be used to, for example, buy something in China, it will lose most of its value.
This is one of the many reasons gold continues to increase in value. It is covertible to most anything you want.
Is there a solution other than gold? Diversification is the best you can do. Get yourself some Euros, some Canadian dollars, ...
Also, watch as the idea of the "Bank of the South" developes. Some people see it as just "a crazy idea of crazy Chavez" but the reality is that South America is an economy that does not have to depend on the U.S. dollar anymore. Having their own currency would be a good thing.
I'm diversified . . . i.e. out of the dollar
but the bank I use (Everbank) is US-based, so I would think that any lock-down would affect those non-dollar denominated accounts too.
I asked my Nicaraguan bride about this, and she reminded me that nearly all the banks there went broke in the 80's. If US banks are screwed, then Nicaraguan banks are jodido'd times ten.
Doors of hope fly open when doors of promise shut. -Thomas D'Arcy McGee
I agree
I would recommend if you are buying non-U.S. currency, you do it is a bank local to the currency. I have been told, for example, that anyone can open an account in the Royal Bank of Canada (but must go to a branch in person). I would expect it is easy to open accounts in the UK and certainly in at least some EU countries.
I inquired about opening an account in China (not as investment security but to make some trade transactions easier) but never got an answer.