| 19 September 2010
The problem of having money! Not my problem, but my girl friend Sally's problem.
We had lunch at the Ivy on Friday (she was paying) and I could tell she was
worrying about something when we had to stand outside on the pavement for ten
minutes while she finished another cigarette. She has those electronic jobbies,
of course, but for a hardened chain-smoker like her they only go so far.
Nobody quite knows where Sally got her money from. She was married once, to
a businessman who later became quite wealthy, but only after they had split.
There's vague talk of family trusts, and I do know that she had a very successful
Norwegian father in the shipping business. At all events, Sally has houses all
over the place, and lots of investments in equities and funds of various types.
She won't say how much exactly, and it's a favourite guessing game among her
friends. Best estimates are about thirty million dollars altogether. For some
reason she won't use professional advisers, so she spends hours every morning
poring over the Wall Street Journal, and glued to the Internet. Anyway, the
bit that really causes her grief is the cash: Sally has a naive belief (my opinion,
but what would I know) in the green stuff, and we do know that she usually has
around two million dollars in cash. Not in bills, although her wallet is always
bulging, and she has safes in every house she lives in. No, we are talking bank
accounts.
Our bottoms had scarcely touched the chairs when she started, and the menus
lay untouched for a good ten minutes.
"Those Irish," she complained, "They're suspending the guarantees
at the end of the month. I've got to move two hundred somewhere else. Bloody
nightmare."
While the debt crisis certainly wasn't helpful for investors in general, and
most stock exchanges took a plunge, the silver lining was that governments stepped
in all over the place to guarantee bank deposits, so that people like Sally
suddenly had a lot more options as to where to put their money. For a while,
in 2008 and 2009, when you met Sally, she would tell you excitedly that this
or that obscure island where Mick Jagger or some such A-list celeb had a house
had given a guarantee for USD100,000 and she had found three local branches
of international banks.
But even my arithmetic tells me that if you have two million dollars in cash
then you need twenty separate bank accounts in different banks, and if you have
ever tried to open a bank account with a new bank then you'll know just how
much bureaucratic garbage you have to wade through. Plus Sally will only use
banks with electronic banking, so that she can count her chickens every morning,
I suppose, and that means passwords, access codes, pin codes, card-readers,
you name it. Sally's workdesk is a picture, littered with innumerable little
machines and lists of numbers that are supposed to be kept secret.
So you can see why the Irish decision (to suspend guarantees the government
offered in 2008 for only two years) causes a big headache. Plus Irish interest
rates are quite high, comparatively speaking, so it won't be easy for Sally
to find alternatives, and it will mean another mound of paperwork and more 'secret'
pin codes which are readily available to her cleaning lady.
"And it all has to be done in the morning," moaned Sally, draining
her second Kir Royale and sucking on her electronic ciggy. "After lunch
I'm past it."
You have been reading an entry on the following blog:
Penelope Wise
Penny Wise but not Pound Foolish! But remember: I am not offering investment advice. My comments are just for your general information; I do not recommend investments, and you should take professional advice before entering any investment contract.
Penelope blogs on investment and financial services around the world: mainstream and alternative. Contact: penny@lowtax.net
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