Worthless euro notes

[susanq]

Did anybody listen to the Jeremy Vine Show, yesterday, BBC R2? There was a chap on who worked in Spain, and he said that people were drawing all their money out at the cashpoint, keeping the notes that had been issued by Germany (serial no's starting with an 'x') paying the rest back in over the counter, then doing the same again until they had all German issued euro's. He reckoned the notes issued by Greece, Italy, Spain, Ireland and Portugal will soon be worthless as the respective countries will pull out of the Eurozone and they will then say their own notes issued will now be worth x amount of pesetas, punts, lira etc.

Is this realistic or alarmist?

FYI.

The 11 digit serial number begins with a prefix which identifies the country which issued it:

X - Germany
Y - Greece
V - Spain
U - France
T - Ireland
M - Portugal
S - Italy
Z - Belgium
G - Cyprus
1 - Luxembourg
F - Malta
P - Netherlands
N - Austria
H - Slovenia
E - Slovakia
L - Finland

Vatican City is outside the eurozone, but is allowed to produce its own euro coins, banknotes are produced in Italy.

[davepoth]

I found a paper.

https://docs.google.com/viewer?a=v&q=cache:Akd...

Footnote on page 2, number 5.

That Paper said:

The serial code on each euro banknote contains a country letter: X refers to Germany and T to Ireland, for instance. However, this identifies the NCB (National Central Bank) that comissioned the printing of the notes, which may or may not be the NCB that issued them. This is because notes are distributed around the NCBs between printing and issue; also an NCB may reissue notes previously issued by other NCBs that it has redeemed. Notes drawn from a bank in a particular country may thus have any letter.

So Jeremy Vine says "PANIC!!!"
And a professor of economics says "Calm Down". Here's his profile.

http://www.lums.lancs.ac.uk/economics/profiles/joh...

[susanq]

Interesting. You'd think the media in Spain etc. would keep people in the loop to avoid panic, wouldn't you?

[98elise]

If its a common currency, then why would it matter where it was printed/issued? I euro is 1 euro regardless?

Also the actual note has no intrinsic value anyway.

[Blackpuddin]

98elise said:

If its a common currency, then why would it matter where it was printed/issued? I euro is 1 euro regardless?

Also the actual note has no intrinsic value anyway.

Ah well you see the basic mistake you're making there is introducing logic into the situation.

[warp9]

If I lived in and had savings in one of those countries, I'd definately already have withdrawn a chunk of dosh into euro's, dollars and sterling.

[sidicks]

warp9 said:

If I lived in and had savings in one of those countries, I'd definately already have withdrawn a chunk of dosh into euro's, dollars and sterling.

...into Euros??

[prand]

sidicks said:

...into Euros??

I see a couple of reasons: Cash will be king when Banks close, ATMs and Card readers stop working. The Euro will still be a valid currency. And secondly, wouldn't the exit of the poorly performing countries see a bouncing back of the Euro as the central, more stable countries pull the value back up?? (of course this may take a while during which Eurogeddon might be taking place....)

[Hugo a Gogo]

warp9 said:

If I lived in and had savings in one of those countries, I'd definately already have withdrawn a chunk of dosh into euro's, dollars and sterling.

why not euro, dollar's and sterlings

[Jules360]

prand said:

I see a couple of reasons: Cash will be king when Banks close, ATMs and Card readers stop working. The Euro will still be a valid currency. And secondly, wouldn't the exit of the poorly performing countries see a bouncing back of the Euro as the central, more stable countries pull the value back up?? (of course this may take a while during which Eurogeddon might be taking place....)

If the banking system has collapsed, i doubt there will be anything in the shops to buy. And physical cash will be worthless ... it has no intrinsic value.

[GTIR]

Jules360 said:

prand said:

I see a couple of reasons: Cash will be king when Banks close, ATMs and Card readers stop working. The Euro will still be a valid currency. And secondly, wouldn't the exit of the poorly performing countries see a bouncing back of the Euro as the central, more stable countries pull the value back up?? (of course this may take a while during which Eurogeddon might be taking place....)

If the banking system has collapsed, i doubt there will be anything in the shops to buy. And physical cash will be worthless ... it has no intrinsic value.

Also, if they pull out the Euro it'll mean the debt, owed to Euro banks, is written off or at least devalued.

I can't see them paying any back. How can they?
Their currency will be pretty much worthless.

[cheddar]

warp9 said:

If I lived in and had savings in one of those countries, I'd definately already have withdrawn a chunk of dosh into euro's, dollars and sterling.

i'd have withdrawn the lot and bought property/cars/food/stuff, not currencies.

[Lost soul]

susanq said:

Did anybody listen to the Jeremy Vine Show, yesterday, BBC R2? There was a chap on who worked in Spain, and he said that people were drawing all their money out at the cashpoint, keeping the notes that had been issued by Germany (serial no's starting with an 'x') paying the rest back in over the counter, then doing the same again until they had all German issued euro's.

If you are drawing money out at a cash point it would be all new notes from the country you are in , sounds like bll st to me

[Pothole]

Lost soul said:

susanq said:

Did anybody listen to the Jeremy Vine Show, yesterday, BBC R2? There was a chap on who worked in Spain, and he said that people were drawing all their money out at the cashpoint, keeping the notes that had been issued by Germany (serial no's starting with an 'x') paying the rest back in over the counter, then doing the same again until they had all German issued euro's.

If you are drawing money out at a cash point it would be all new notes from the country you are in , sounds like bll st to me

certainly does sound like bullst, yes.

Edited by Pothole on Saturday 16th June 09:57

[-Pete-]

It's.an interesting question though, if Greece announce their exit next week, what happens to Greek and non-Greek Euro currency in Greece and other countries? If it's not possible to identify Greek Euros, then they would be wise to get all their money out in cash, or certainly move it now into any other currency. Or buy houses in London...

[Lost soul]

-Pete- said:

It's.an interesting question though, if Greece announce their exit next week, what happens to Greek and non-Greek Euro currency in Greece and other countries? If it's not possible to identify Greek Euros, then they would be wise to get all their money out in cash, or certainly move it now into any other currency. Or buy houses in London...

All Euros have art work on them deffining where the originate from , but a Euro of any origin can be used in any Euro country so whats the problem

[-Pete-]

Lost soul said:

All Euros have art work on them deffining where the originate from , but a Euro of any origin can be used in any Euro country so whats the problem

Did you read the thread? The 'problem' is if Greece leaves the Euro, what happens to Greek Euros, whether they're owned by Greeks or anyone else in Euroland?

If they become worthless or exchangeable only for New Drachma, I imagine the non-Greeks will be refusing to accept them already. If not, will Greeks not just take their cash abroad and exchange it for non-Greek Euros?

Of course as I said, I think anybody in Greece with any savings will have converted it into something safe already, London property for example as I mentioned in my post.

[Lost soul]

-Pete- said:

Lost soul said:

All Euros have art work on them deffining where the originate from , but a Euro of any origin can be used in any Euro country so whats the problem

Did you read the thread? The 'problem' is if Greece leaves the Euro, what happens to Greek Euros, whether they're owned by Greeks or anyone else in Euroland?

.

yes i did read the thread , did you read my post or are you hard of thinking

[-Pete-]

Neither, and not in the mood for an argument. Have a nice weekend.

[Riff Raff]

-Pete- said:

Lost soul said:

All Euros have art work on them deffining where the originate from , but a Euro of any origin can be used in any Euro country so whats the problem

Did you read the thread? The 'problem' is if Greece leaves the Euro, what happens to Greek Euros, whether they're owned by Greeks or anyone else in Euroland?

If they become worthless or exchangeable only for New Drachma, I imagine the non-Greeks will be refusing to accept them already. If not, will Greeks not just take their cash abroad and exchange it for non-Greek Euros?

Of course as I said, I think anybody in Greece with any savings will have converted it into something safe already, London property for example as I mentioned in my post.

I think the euro notes will still be euros even if Greece is forced out of the single currency.

What would happen I imagine, is that all of the non-cash balances in Banks and other institutions, the 'electronic' money if you will, would be re-denominated as the new currency at a rate of 1:1. When you tried to withdraw it in cash you would be given the new currency.

It would be a bit chaotic, but not half as chaotic as things would be if other euro area countries refused to honour notes from anywhere other than Germany, so the idea that which notes you have matters seems a bit daft to me. The ECB would have to stand behind the euro notes wherever printed.