The pound is on the brink

[baypond]

Sterling got crushed as having one of the worst exposures to the credit cruch/banking crisis. The numbers coming through in recent weeks across the globe suggest that the rates of decline are moderating and that low or zero interest rate policies, and fiscal expansion are having some effect. Almost all manufacturing numbers are also improving. Given Sterling got hit hard when the economic situation was tail-spinning, it is right that as economic numbers improve that Sterling should gain back some value against the EURO that it lost last year.

Most investors are currently making the assumption that we will have a double dip recession. That is, that after this improvement phase petres out, we will have another dip in economic activity until the economies finally make a more self-sustained recovery. On this basis we could see further GBP strength, but this may not prove long lasting.

[mint]

So, the way to go now is to cash in some sterling and stash the money in your euro account before it all goes pear-shape for the pound again? Have I got this right?

[cooperlola]

[quote user="sweet 17"]So, the way to go now is to cash in some sterling and stash the money in your euro account before it all goes pear-shape for the pound again? Have I got this right?[/quote]Depends whose predictions you believe.

If economists and other financial gurus and experts agreed or were always correct, nobody would be in the sh** would they?[Www]

[mint]

Ah, Coops, never a truer word.  That's definitely putting it in a nutshell.

As with much else in life, the most essential tends to be totally unpredictable.[:(]

[allanb]

[quote user="sweet 17"]So, the way to go now is to cash in some sterling and stash the money in your euro account before it all goes pear-shape for the pound again? Have I got this right?[/quote]Yes.  Or, in other words, buy euros when the price is low and sell when it is higher.

I guarantee that you will make money by following this simple rule.

[mint]

Thank you for the "rule", allanb.  It's not the rule that's the problem though, is it?[:D]

After all, all those cheating MPs knew the rules back to front; the rules weren't the problem.

Wouldn't mind some of their ingenuity in exploiting the rules, however.

[bigears]

Hi

if you ever see 1.25 again I would grab it.  Uk plc is heading up the creek without paddles and nobody steering.  All the media can talk about is MPs expenses.  They should pay them properly (perhaps tied to average Gps/dentists  wage) and tie them down to a proper contract and get them more focussed on doing their best for the UK. 

[just john]

working it's way up the creek, yes, except curiously some of the FTSE (those who have least to do with Gorgon) and who are just heading up . . .

[PaulT]

[quote user="bigears"]

Hi

if you ever see 1.25 again I would grab it.  Uk plc is heading up the creek without paddles and nobody steering.  All the media can talk about is MPs expenses.  They should pay them properly (perhaps tied to average Gps/dentists  wage) and tie them down to a proper contract and get them more focussed on doing their best for the UK. 

[/quote]

Yes, they have had their hands in the till which is totally and utterly wrong.

However, their pay system is also wrong. They get paid whether they do anything or not which is wrong. However, for those who put in the time and effort the actual pay is appalling. For them perhaps the rewards should be higher than a GP / dentist. They are the law makers of the country and therefore have a great responsibility. For the Prime Minister to receive less pay than a large number of local authority CEOs seems somewhat wrong. They are on vairable term contracts with a maximum term of 5 years and a minimum of, at times, less than a year.

Anyway, UK PLC is not up a creek - if it was then it would mean that it knew where it was.

[Sprogster]

bigears, you might be right, but as time goes on and more economic data comes out of the Eurozone, it is becoming increasingly apparent that Europe as a whole is heading up the same creek!

The over valued Euro against the £ and US$ is crippling Eurozone industry, as its two biggest export markets by far are the UK and USA. If the USA and UK go up the creek, they drag Europe with it!

[Gluestick]

Agreed Sprogster.

Which was the core premise of my earlier post in this thread and and another thread on the same topic last year.

The false high of the Euro, it has to be remembered, came about not because of economic mega-success from the Eurozone, but rather as funk money rushed away from the US$ in sheer blind panic!

And since the US Dollar was the de facto global reserve currency (And indeed has been since the post Bretton Woods New Jersey Conference in 1944 which set up the IMF etc) and increasing distrust of the massive US deficits grew, all apart from gold, there were few hedges available.

Unfortunately now, however, the core realities of the economic problems facing the Eurozone, its basket case members (which grow almost by the day!), and rapidly shrinking global trade means some value realignment of the Euro must be seen as inevitable.

Unfortunately, Jean Claude Trichet and his merry men at the ECB, behave rather like CAP: they sit on their thumbs until a mountain of unsaleable agricultural goods has been amassed: and then give it away!

Obtaining a consensus will always take far too long, due to bureaucractic inertia: and in times of volatile markets, corrective action has to be rapid.

And that for me always was and always will be the major problem with any currency mechanism which embraces members with such disparate discrete economies: the one-size-fits-all approach clearly cannot work for (e.g.) Germany, Denmark and FRance; as well as Greece, Ireland, Italy and Malta!

Trouble is the ECB has tended to be dominated by the Bundesbank which due to the economic and fiscal collapse of the Weimark Republic, presents with a pathological fear of inflation: hence base rates have been synthetically held up too high for too long.

Expect some pretty dramatic corrections soon.

 

[Jako]

Like many in the UK, you don't even have your facts right.

Denmark (like the UK) is NOT part of the Eurozone. Why would Wales,N- Ireland , Scotland and The City stay within the UK when the one-size-fits-all approach does not work? The UK should gradually adjust its economy towards the continent, but instead  the UK is waiting for the continent to ajust their economies towards the UK...

Printing huge amounts of money will not help the pound. Use the current idiot high levels for sterling to save your money before it follows and supercedes the 'mighty' Dollar on its way down...

[NormanH]

[quote user="Jako"]

Denmark (like the UK) is NOT part of the Eurozone.

[/quote]

Yes highly amusing to read that from a self styled 'expert'

Nor is Sweden..

[Gluestick]

Meant Finland, probably: in a rush working this morning. I do have other fairly more important stuff do do.............

If you care to use your search facility you'll find a post I made last year with the full list of current Euro members.

Glad to see your usual accerbic style doesn't desert you Norman!

Do you actually have any friends, BTW?

[:D]

So, perhaps you might care to share with us your condensed wisdom and considered opinion?

 

[Gluestick]

[quote user="Jako"]Like many in the UK, you don't even have your facts right.
Denmark (like the UK) is NOT part of the Eurozone. Why would Wales,N- Ireland , Scotland and The City stay within the UK when the one-size-fits-all approach does not work? The UK should gradually adjust its economy towards the continent, but instead  the UK is waiting for the continent to ajust their economies towards the UK...

Printing huge amounts of money will not help the pound. Use the current idiot high levels for sterling to save your money before it follows and supercedes the 'mighty' Dollar on its way down...

[/quote]

Rather clear you don't actually understand economics or common purse fiscal affairs.

"Why would Wales,N- Ireland , Scotland and The City stay within the UK when the one-size-fits-all approach does not work?"

Probably, since the core structure is based around one exchequer and fiscal system might go some of the way to explaining it.

Unless you are suggesting that the City of London declaring UDI is a rational and possible circumstance?

 

 

[NormanH]

[quote user="Gluestick"]

Glad to see your usual accerbic style doesn't desert you Norman!

Do you actually have any friends, BTW?

[:D]

So, perhaps you might care to share with us your condensed wisdom and considered opinion?

 

[/quote]

"A hit, a very palpable hit..."...I mean I have obviously scored one, for you to attack me in that personal way.

My idea of friendship includes the idea that one can correct each other, or laugh with the other person at one's idiocies...

[LEO]

 Leo writes;

When"" NormanH posts, I read with interest so ,I guess, from a distance I am one of his friends .

With NormanH you get no no bullshit or patronising . Keep posting Norman!

Leo

[NormanH]

Thanks!  I had no idea...

[mint]

Better exchange photos first, don't you think?

[woolybanana]

Norman is grateful for whatever he can get!

[Chancer]

Well he has another fan here as well!

Actually I like GS's postings as well (although the financial ones can get a bit intense), does that make me a cyberslut?

[Scooby]

He doesn't make many comments but those he does seem to be frank, accurate and to the point.  Probably won't score him points with the airy fairy brigade but hey....

Ditto re GS - though reading them is a bit like being back at work sometimes [Www]

[LEO]

[quote user="sweet 17"]Better exchange photos first, don't you think?[/quote]

My Avatar is a good resemblence!

[mint]

Leo, you couldn't say "cheese" and put a bit of cheerfulness into your next photo, could you?

[NormanH]

Depends on whether you are a man or a woman.

If you are a woman you are a cyber slag ( sluts are those that don't do the housework, not those with a big sexual appetite)

If you are a man you are a cyber  stud .......