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Good news for Moville savers and the Irish economy

Posted Wednesday, October 1, 2008

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Bank Guarantee

The Irish Government has announced that it is going to guarantee all bank deposits.

They are the only Government anywhere to do so.

France, Spain and Italy are guaranteeing £16,000 of bank deposits.

The UK Government is guaranteeing £50,000 worth of deposits.

The Germans are guaranteeing £55,000.

The US is guaranteeing $100,000 and looking to guarantee $250,000.

Smart Move

So, what do people do who have more than the amounts that their Governments will guarantee?

The smart thing to do would be to take the unguaranteed money in their accounts, take it out and move it to an Irish bank account.

This is what is happening.

It seems that the Irish Government is guaranteeing savings worth twice the Irish economy – not twice the annual tax returns but twice the annual economy.

Whether they could do so or not is another matter.

Flowing In

However, what is now happening is that savings are flowing into Irish banks which could mean at some point that we don't have a credit crunch at all here.

Indeed, if a lot of savings piles in there they could be loaning it out elsewhere.

That could be mean that the economy and the housing market and building trade pick up more quickly here than in othher countries with more credit available - and that would be very good for Moville.