2 for 1 forever?

Old Nov 1st 2012, 12:51 am
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Default 2 for 1 forever?

The GBP has been roughly around $2nz for 1gbp for what seems like forever bar a while back when we had a wee spike we had 2.08. Still have some money in the Uk only earning 2% and I think the time has come to maybe bite the bullet and get it over here to get the 4% or thereabouts on offer.

The reason I think this is because I recently heard that some learned people in the Uk reckon that the UK economy is heading towards becoming a '3rd world economy'.

I know the kiwi is very high but the gbp is also very, very weak and the outlook does not seem rosy at all.

The NZ Reserve bank WILL NOT intervene to lower the currency so methinks we are stuck at $2 ad finitum.
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Old Nov 1st 2012, 3:07 am
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Default Re: 2 for 1 forever?

I was hoping this was going to be a BOGOF thread... you know, buy one, get one free or 2 for the price of 1.

Genesis, you are probably right but hey, life is so short to worry about something that may or may not improve, so do what you have to do, enjoy good health and your family, and be happy
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Old Nov 1st 2012, 3:24 am
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Default Re: 2 for 1 forever?

If I'm sticking nose in where not required - please say so.

AFAIK interest rates in UK are net - i.e. the bank pays the tax for you.

In Oz (and I wonder if it is the same in NZ) rates are gross and come tax time, one has to pay the tax on interest earned.

So 2% net against 4% gross - is there much in it? My maths aren't much good.

Aus dollar is doing the same to me. When I moved here 2.6 was the norm, now it's 1.56 at best.
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Old Nov 1st 2012, 4:33 am
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Default Re: 2 for 1 forever?

Originally Posted by Sherlock Holmes View Post
If I'm sticking nose in where not required - please say so.

AFAIK interest rates in UK are net - i.e. the bank pays the tax for you.

In Oz (and I wonder if it is the same in NZ) rates are gross and come tax time, one has to pay the tax on interest earned.

So 2% net against 4% gross - is there much in it? My maths aren't much good.

Aus dollar is doing the same to me. When I moved here 2.6 was the norm, now it's 1.56 at best.
I have to pay tax on both interest in the UK and NZ. The difference betwixt 2 and 4 % is 50%....which is about $8k in lost interest whilst left in the UK. That was/is my dilema. Waiting for the forex to get better..I now doubt it will in the short/medium and long term.
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Old Nov 1st 2012, 4:39 am
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Default Re: 2 for 1 forever?

Originally Posted by cappuccino View Post
I was hoping this was going to be a BOGOF thread... you know, buy one, get one free or 2 for the price of 1.

Genesis, you are probably right but hey, life is so short to worry about something that may or may not improve, so do what you have to do, enjoy good health and your family, and be happy
Its not about worry..gave up worrying about currency many moons ago. Just a point to perchance start a debate. This issue is important to anyone who has money in the Uk they would prefer to have here. I very much enjoy the manifold things I have that I am very grateful for. Just wish my son who is 11 would stop behaving like that horrid kid off Harry Enfield!!!!!!!
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Old Nov 1st 2012, 9:18 am
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Default Re: 2 for 1 forever?

There's always the chance of Murphy's Law Genesis (or is it Sod's Law .. one of those laws anyway). ie you wait years and years for the NZ dollar to fall, nothing happens, you decide to bite bullet and change your dough to NZ dollars, and the very next day the NZ dollar crashes. That's the sort of thing that would happen to me. I swear.

The trouble is, even the financial analysts are prone to major stuff ups in their predictions.
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Old Nov 1st 2012, 9:20 am
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Default Re: 2 for 1 forever?

Originally Posted by Genesis View Post
The GBP has been roughly around $2nz for 1gbp for what seems like forever bar a while back when we had a wee spike we had 2.08
It seems like forever but it is only four years. During that whole time interest rates in the UK have been close to zero and Quantitative Easing has hit the currency further.

The question is will that change sooner or later or never?

I wish I knew!

I am reminded of the reason that I quit Economics courses when I was at University. One day the lecturer stood at the front of the lecture theatre and said
For the next three weeks we will be covering how the currency markets work. Of course, if I really knew how the currency markets worked I wouldn't be stood here today talking to you, I would be making my fortune playing the currency markets.
I didn't go back after that. If I had done, I might be more help with your question.
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Old Nov 1st 2012, 12:08 pm
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Default Re: 2 for 1 forever?

I'm seriously considering my options on this front at the moment, my gut instinct is to keep the money in the UK. The money isn't absolutely critical to take with me and not all of it is in regular savings accounts, a reasonable proportion is in a Stocks and Shares ISA.

I think the least likely event we'll see is the NZD getting significantly stronger on the GBP - so I don't anticipate losing much, if anything by not moving over my GBP's sooner rather than later anyway.

I have taken a little risk recently however; to cut a long story short, I just paid something in the UK in GBP's to the tune of £3,640.38, to be exact.

$7,600 has been paid in to a NZ bank account awaiting my arrival next year, good deal? It appears to be right now, come my arrival in NZ? We'll see.
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Old Nov 1st 2012, 8:33 pm
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Default Re: 2 for 1 forever?

Originally Posted by waikatoguy View Post
There's always the chance of Murphy's Law Genesis (or is it Sod's Law .. one of those laws anyway). ie you wait years and years for the NZ dollar to fall, nothing happens, you decide to bite bullet and change your dough to NZ dollars, and the very next day the NZ dollar crashes. That's the sort of thing that would happen to me. I swear.

The trouble is, even the financial analysts are prone to major stuff ups in their predictions.
Yeah I know what you mean. However a few months ago the forex got to 2.08 and I did bite the bullet and changed up all the GBPs from both our pensions into $s..fortunately for us (and for the 1st time!!) we appear to have gotten a good deal because it slid back to the low 1.90s a few weeks later and never went higher than 2.08. Good to get it right just once in a life time eh?
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Old Nov 2nd 2012, 6:50 am
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Default Re: 2 for 1 forever?

It won't stay 2:1 forever just as it hasn't stayed 2.5:1, 1.9:1 or any other rate. Will it go up or down....well you know what I think of the long term trend, buck it at your peril.

Not to say there won't be short- and even medium-term shifts against the trend and you can make a crrency shift out of the rates at any two points in time if you've a mind to....but the 10yr trend line just goes one way...

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Old Nov 2nd 2012, 8:31 am
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Default Re: 2 for 1 forever?

Originally Posted by simonsi View Post
It won't stay 2:1 forever just as it hasn't stayed 2.5:1, 1.9:1 or any other rate. Will it go up or down....well you know what I think of the long term trend, buck it at your peril.

Not to say there won't be short- and even medium-term shifts against the trend and you can make a crrency shift out of the rates at any two points in time if you've a mind to....but the 10yr trend line just goes one way...

http://www.xe.com/currencycharts/?fr...o=NZD&view=10Y
Same trend isn't so obvious from 2005/6 staring at $2.46 instead of $3.19, or similarly if you take the 10 year graph back a few more years. That said I do think $2 is the new norm.
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Old Nov 2nd 2012, 10:00 am
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Default Re: 2 for 1 forever?

I think we've ;earned that everything in the markets is nothing but speculation.
It's like the blind leading the blind.
If it was me I'd cut and run and make the most of a bad situation.
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Old Nov 2nd 2012, 10:18 am
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Default Re: 2 for 1 forever?

Originally Posted by Justcol View Post
I think we've ;earned that everything in the markets is nothing but speculation.
It's like the blind leading the blind.
If it was me I'd cut and run and make the most of a bad situation.
My sentiments entirely. Now I just need the balls to do it..that could be a tricky one!
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Old Nov 2nd 2012, 12:51 pm
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Default Re: 2 for 1 forever?

Genesis, or anyone else for that matter;

When you've transferred your sterling to NZD's what are the normal charges applied to transfer the cash from your UK account to you NZ account?

It is flat rate, or a percentage. Just curious.
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Old Nov 2nd 2012, 8:02 pm
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Default Re: 2 for 1 forever?

Originally Posted by TommyLuck View Post
Genesis, or anyone else for that matter;

When you've transferred your sterling to NZD's what are the normal charges applied to transfer the cash from your UK account to you NZ account?

It is flat rate, or a percentage. Just curious.
When I did my last big forex in NZ (with GBPs that were in a UK bank acct) I simply got the rate of the day and that amount was then transferred from my UK acct in sterling into the bank acct of HIFX and then I got my kiwi $$s. There were no charges at all.

So say I changed up at 2.50 and did 10,000gbps I got $25k NZ and 10k gbps left my bank acct. The total transaction cost me 10k sterling exactly.

There may well be charges if you do the forex thru your bank..I dunno about that. But when you exchange with a big forex dealer they make their money on the rate you changed at..there are no other charges.
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