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Bankruptcy of the country and deposits with the broker

Discussion in 'Beginners Forum' started by davidjss, Apr 26, 2012.

  1. davidjss

    davidjss

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    Just hipotetical question.... When country goes bankrupt has that any effect on money deposits within the broker located in that country? I mean, can money be frozen or something?
     
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  3. budado

    budado

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    Yes it can. But if ever that going to happen its will just going to depreciate to the point that its almost has no value at all.
    For example 40 years ago Philippine peso is equal to US dollars. But now Philippine Peso right now is so depreciated that the value of 1 usd is 42 PHP and its even goes down to as low as 55 php.
     
  4. Cutiekc

    Cutiekc

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    I don't think bankruptcy got got any thing to do with the forex world rather the currency involve depreciates where by affecting many traders that do trade it,why must the froozen any broker money,whereby forgetting to realize that bankruptcy is be cause by poor economical management.
     
  5. kalpeshmkm

    kalpeshmkm

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    I think the bankruptcy is very dangerous thing for the any country and it can make country destroyed and poorer and economic losses.
     
  6. budado

    budado

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    Theirs no way a country going to get bankrupt. Name one if you can think of one. Because even if a country chance government or chance constitution the contract remains and theirs no such thing as bankrupt government unless that country is underwater or does not exist anymore in any form or shape.
     
  7. rexway

    rexway

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    I also doubted this when i first get the information I dont think that its even possible for this happen except the country dont exist here on earth that is its in the water or sea as a whole .
     
  8. ryuken

    ryuken

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    I think the deposits of the broker are going to be having any issue at all. We have to think that sometimes people are going to be thinking a way too different for the bankruptcy because there are some of the companies who do manage to get the money out of it for sure.
     
  9. Alf

    Alf

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    When some country went in bankruptcy this mean that this country doesn't have any money. It is not related with broker/bank deposits, because this money are private.
     
  10. ryuken

    ryuken

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    I have noticed that most of the time brokers where the country is gone bankrupt are less likely to return the money. I don't think we cna consider how the broker and the people are going to be spending time. I would surely consider that sometimes it is all about risk.
     
  11. Cutiekc

    Cutiekc

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    I don't think a broker that based on a country that has a poor economy or that has gone bankruptcy will affect the investor because the country is facing the problem and not the broker because the broker money is still safe.
     
  12. ryuken

    ryuken

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    I think you can see that bankruptacy can be odd in most of the cases if you understand that people can spend money and then country can lead them to the no savings side. I think we have to see that it would be something that they are going to be having some deposit issues all the time.
     
  13. budado

    budado

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    Theirs no country in current situation that can go bankrupt and run away with its responsibilities or debt. If ever that going to happen its currency will be devalued to the point that its almost worthless. that's why theirs some countries who has more than 1,000 on their currency but its only value is 1 dollar and so on. Like Yen that is defeated after world war II or South Korea that is still at war with N. Korea and other countries that gone bankrupt because of war and so on.
     
  14. kaiceaziz

    kaiceaziz

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    I think every forex broker must read the regulation of the country that he choose his jurisdiction and decide what is the best. And for that broker use a regulator body. It protects them from getting fraud by every country. It s as a lawyer for the broker. For instance, the UK and the US has established a good financial regulators that regulate the stock and commodities market....etc. Example of such agencies In the US -CFTC agency, the commodities and futures trading commission. And in Britain - FSA , the financial service authority all of which regulates forex brokers and operates in the financial services. Agencies like this can be found in japan Singapore and other European countries. So in this case bankruptcy can be taken care of through such agencies.
     
  15. Cutiekc

    Cutiekc

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    When a country goes banrutcy the value of its currency depreciates where by making it hard for those who have that said currencies on their trades. Thats why the fundamental analysis is a so important because before ever a country goes bankrupt there should be the speculation on news about their poor economy which is about crashing.
     
  16. winuga

    winuga

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    it happened but not because country bankruptcy but it happen on LR, all money frozen by the US government, they do not care about who the owner of funds and simply frozen all the money there, but what make me amaze is the brokers still roll on with their business even bearing lost because of that situation
     
  17. Angelic

    Angelic

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    That correct and a good example forex trading can never go bankruptcy its a decentralize business merely the broker will go bankruptcy in here and when that happens it will affect just the clients making use of that payment processors. I think that brokers saw it coming that they do not have much much in LR.
     
  18. Cutiekc

    Cutiekc

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    Yes I agree with you because assuming forex trading is a centralised business like that of stock exchange. Assuming the fall of LR was to happen with the stock market the there will be possibilities that there will be some shaky moment for the stock exchanging market. Most of their brokers would have gone banrupt.
     
  19. barood4money

    barood4money

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    There are multiples reason which can effects the economy of an organisation or country. And that effect causes only disasters for everyone. But over a time we get over from it.
     
  20. Daisy

    Daisy

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    Well, I think forex and bankruptcy of a country might stand on different ground. If a country goes bankrupt, their currency will depreciates so you can go short on it of course. You might not want to deposit more than $100 during those kind of hard time. You just never know if they will close off their company and scam your money or steal from you or just have some laws that will come in and interrupt the business of forex and the brokers. Well, that is less likely to happen in this day and age. However, you do not want to deposit so high in any broker, and remember events like LR, where your money was lost. Also, bitcoin recently had large illegal scandals too so anything can happen so protect yourself first.
     
  21. Cutiekc

    Cutiekc

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    That is the more reason why analysis is better before trading and for the fact that a country is exprience bankrutpcy as attributed by mismanagement of some natural disaster then the countries currency will decrease in value exponetially. But then, a trader who makes use of the gamble scheme on forex won't get to know that on time.