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01-07-2008

December 27, 2007

By Jeff D. Opdyke, Wall Street Journal

The Problem: The anemic dollar is eroding the value of your investments and income.

The Fix: Open a foreign-currency account. Cathay General Bancorp, in Los Angeles, and Jacksonville, Fla.-based Everbank.com are two of a limited number of U.S. banks offering savings accounts in roughly a score of primary and secondary currencies, such as the British pound and the Czech koruna. Interest rates can range as high as 11.6% for a CD denominated in Icelandic krona at Everbank. Or consider a bet on the Chinese yuan's continuing its march higher against the dollar. Both Cathay and Everbank offer savings accounts tied to the movement of the yuan, since you can't own the currency directly yet. The accounts are FDIC-protected in the event of bank insolvency, though you can lose money if the dollar strengthens against your currency of choice.

For a minimum of $20,000, Everbank also provides access to high-quality foreign government bonds from countries as varied as Australia and Iceland. Yields range from 3.5% for a two-year euro note to nearly 7% for a two-year New Zealand bond.

Meanwhile, Entrust Group in Reno, Nev., is set to launch in the second quarter of 2008 a unique Individual Retirement Account that will allow savers to denominate their retirement savings in one of four major currencies, including the euro and the Danish kroner.