10000 euros - What best I can get from them?

[Adrian42]

Higher intrest rates will cause (sooner) collapse of the EU.

Low interest rates might do that even faster...

You really think the ECB should follow even more closely their script from end of 1920's for destroying the continent?

You really think the ECB should follow even more closely the script of the FED from 10 years ago, that ignited the current crisis 5 years ago?

there is absolutely nothing in the current state of the economy to make inflation run.

A weakening Euro can obviously let inflation run.

A war in Syria that ignites the whole region could result in inflation skyrocketing.

Deeply depressed, and will be for years to come.

The Eurozone went out of recession in Q2 2013.

Making people and companies to take higher risks is the wanted short-term effect of low interest rates for improving an economy.

What i here is, that companies, at least all but the most largest ones, are complaining that credit is very tight, hindering business of those that still would have one.

Banks are not giving much credit to businesses at the moment, but still for mortgages.

Today you can get a mortgage for 75% of the apartment price.
A sudden decrease of apartment prices in the 30-40% range could be pretty devastating.

Helsinki housing is expensive as population is increasing and (both for public sector and private shortfalls) construction isn't living up to the demand.

Population is increasing, but construction is also increasing.

And Helsinki has less jobs than 5 years ago.

(it would help if they were less immigration from those groups that can't cover their own housing expenses)

Viewing it more positively, the government paying high rents for many people who couldn't afford it otherwise is an (expensive) way to stabilize the housing market.

If Finland will have a huge bubble in the local housing market bursting, then Finland will be Spain 2.0

I find it hard to see what would be common with the causes etc. of 1.0 and 2.0, except euro of course.

Both would be caused solely by a housing bubble.

(The ignition of the crisis in Spain was the bigger crisis, but that only determined the time of a crash that anyway had to come sooner or later.)

[Rip]

You really think the ECB should follow even more closely the script of the FED from 10 years ago, that ignited the current crisis 5 years ago?

EU decided, ignoring economic theory, initiate a currency union without a federal state to support it. You can't blame FED or US for the fact the eurozone is doing miserably compared to them. Google EU and US unemployment rates since 2008.

A war in Syria that ignites the whole region could result in inflation skyrocketing.

So in the case new oil crisis the response from ECB should be to hike interest rates? OK, maybe they just are that stupid...

Deeply depressed, and will be for years to come.

The Eurozone went out of recession in Q2 2013.

Again, Google EU unemployment rate. That we have meager growth for one quarter after miserable economic performance of five years does not mean the economy would not be depressed.

I find it hard to see what would be common with the causes etc. of 1.0 and 2.0, except euro of course.

Both would be caused solely by a housing bubble.

Finnish economy is currently (I am talking about actual ones, not any hypotheticals) in troubles for some quite different reasons.

[Adrian42]

You really think the ECB should follow even more closely the script of the FED from 10 years ago, that ignited the current crisis 5 years ago?

EU decided, ignoring economic theory, initiate a currency union without a federal state to support it. You can't blame FED or US for the fact the eurozone is doing miserably compared to them. Google EU and US unemployment rates since 2008.

That's deliberately picking a date to make the EU look bad.

Comparing the unemployment rates today with January 2002 (when the Euro was introduced), the unemployment rate grew by only 13% in the EU, and by over 30% in the US.

Fun fact:
The Finnish unemployment rate is currently still lower than it was when the Euro was introduced.

I find it hard to see what would be common with the causes etc. of 1.0 and 2.0, except euro of course.

Both would be caused solely by a housing bubble.

Finnish economy is currently (I am talking about actual ones, not any hypotheticals) in troubles for some quite different reasons.

Yes, but when trying to solve the current problem might be the cause for much bigger problems in a few years, it has to be considered whether that is really a good idea.

[Rip]

That's deliberately picking a date to make the EU look bad.

I honestly just picked as the reference point how the two systems have reacted under a economic shock-

Comparing the unemployment rates today with January 2002 (when the Euro was introduced), the unemployment rate grew by only 13% in the EU, and by over 30% in the US.

It is true that the start of the crisis EU faired better, among other things social safety net in various countries helped to soften the blow. But where do you get your data? Google's own data browser gives me EU area unemployment rate from start of 2000 to April this year from 9% to 11% (and rising), an increase of 22%, while the euro area unemployment rate is listed here as: going from something bit below 9% to 12.1 (hike of about 35%).

Fun fact:
The Finnish unemployment rate is currently still lower than it was when the Euro was introduced.

Yes, we were supposed to have this thing called "työvoimapula" when all the people born around 1946 retired.

Yes, but when trying to solve the current problem might be the cause for much bigger problems in a few years, it has to be considered whether that is really a good idea.

Hunting for phantom menaces, and ignoring the clear and present problem is usually not very sensible cause of action. I wish we did not have euro. If we "must" have it, then it would be useful if it wasn't operated under an ideology that makes Milton Friedman look like a left wing radical.

[Adrian42]

That's deliberately picking a date to make the EU look bad.

I honestly just picked as the reference point how the two systems have reacted under a economic shock-

That is not a good reference point.

Take a look at Spain:

During the Spanish housing bubble, unemployment in Spain was lower than normal due to the bubble.
After the bubble bursted, unemployment skyrocketed - now they have to pay the bill for the boom borrowed through the bubble.

When you look at Spanish unemployment figures, you can also see that even the temporary interruption in the bubble development in the mid-1990s when the housing price explosion halted for a few years was enough to push the Spanish unemployment rate over 20%.

The low unemployment rate in Spain in 2008 is actually what causes the high unemployment rate today, and definitely not a good basis.


In Greece it is even more straightforward:

The Greek government created too much debt by employing too many people.
Not all excess government spending in Greece was on directly employing people, but here it is most obvious that the low unemployment rate in 2008 is the direct cause of the high unemployment rate today - and not a reasonable reference point.

Comparing the unemployment rates today with January 2002 (when the Euro was introduced), the unemployment rate grew by only 13% in the EU, and by over 30% in the US.

It is true that the start of the crisis EU faired better, among other things social safety net in various countries helped to soften the blow. But where do you get your data? Google's own data browser gives me EU area unemployment rate from start of 2000 to April this year from 9% to 11% (and rising), an increase of 22%,

My bad, I got my math wrong.

Fun fact:
The Finnish unemployment rate is currently still lower than it was when the Euro was introduced.

Yes, we were supposed to have this thing called "työvoimapula" when all the people born around 1946 retired.

Immigration more than compensated for that.

When you look at Figure 2 in http://www.stat.fi/til/tyti/2012/13/tyt ... 01_en.html you will notice that today there are actually significantly more people employed in Finland than at the beginning of 2002.

Yes, but when trying to solve the current problem might be the cause for much bigger problems in a few years, it has to be considered whether that is really a good idea.

Hunting for phantom menaces, and ignoring the clear and present problem is usually not very sensible cause of action. I wish we did not have euro. If we "must" have it, then it would be useful if it wasn't operated under an ideology that makes Milton Friedman look like a left wing radical.

No, the main problem is that quite diverse economies that are in different states of the normal up-and-down capitalism cycles share a common currency and interest rates.

8 years ago Germany was in huge troubles with an unemployment rate much worse than in Finland today (over 11%!).
Germany would at that point definitely have benefited from lower interest rates, but then the situation in Ireland or Spain today would then be much worse than it is now.

[Rip]

No, the main problem is that quite diverse economies that are in different states of the normal up-and-down capitalism cycles share a common currency and interest rates.

So are we getting closer to common ground that euro is the problem?

[pavi]

Going back to OP's question. Money value is decreasing all the time due to inflation. Putting money in bank as Fixed Deposit will just decrease the money value since interest rate is lower than inflation. Only way to avoid losing the money value is by taking more calculated risks(for this one must be well read and wise). Low risk bonds are ok but only in the long-term. Due to changes in behavior of global markets and crises popping here and there, there are no immediate returns.