joe2k17 wroteHello Sero,
Thanks for raising this I also have the same question, how wise it is now to block money in LBP for 5 years and the current economic situation is so bad ?
I am not sure if it is even better to put your money in USD and get lower interest and stay safe ?
Or may be block them in LBP/Monthly and Monitor to have a little higher rate and a small chance to convert them to USD in case of any economy collapse.
Let see what other member think it s best to do at the moment ?
15% yearly (on 5 years CDs) return is extremely high and to make a decision you have to put it under the umbrella of high-risk/high reward. To be sure I am not understating: this interest is soo good that if you have 80k only you can make the monthly average salary of 1k/month in Lebanon. Being an investment/finance fan, this is a very high return and there is no other legal way to make this sum in a small capital.
samer wroteI've been thinking about this and it's hard for me to completely grasp the situation. I hope other members that have deeper knowledge about economics will step in to enlighten us.
Here's what I see:
- Sharp rise of interest rates as discussed in this topic
- Lebanese gov bonds trading at a discount (95 cents on the dollar for short-medium term), which hints that the market thinks the government will default on its debt obligations
- Nominal debt at 152% of GDP. Third-highest in the world.
- No government formation in sight means no budget for 2019 and unclear handling of outstanding debt
- Every business-owner I know complaining that "business is slow"
- Housing loans on hold, real-estate dip
No one on earth can know how close we are to an economic collapse, this is like my old neighbor who was diagnosed with terminal cancer and had 6 months to live, this was 15 years ago and he is still living his normal life without undergoing any treatment. The doctors who predicted his death are as highly experienced as the economists who are predicting the collapse since years ago. The conclusion: No one ever knows the maximum stress any system can take (financial or biological or...), this is not science this is merely the statistical model being put into reasoning, this is why those kind of predictions are never accurate. I can tell that only people in high power know about any coming collapse but only before a short period of time and to prove it to you: if you track down major economic breakdowns in any economy/stock in the world in the last 50 years you can see that billionaires have lost big money to this. Those people hire professionals to do their study but when the big wave comes everyone goes down.
Everyone has to make his own decision, hooray for the people with no cash for the piece of mind they have now. But for the people having cash in Lebanon, I am not sure of the alternatives they have, not everyone considers it convenient to put their money in a bank outside the country. Buy small apartments, rent them and keep some money aside for emergencies. Any ideas guys?