Chancer Posted March 10, 2010 Share Posted March 10, 2010 Its dropped under the so called barrier of €1.10, if it was indeed a pyschological barrier then it will probably continue to fall. Link to comment Share on other sites More sharing options...
Gluestick Posted March 10, 2010 Share Posted March 10, 2010 [quote user="Chancer"]Its dropped under the so called barrier of €1.10, if it was indeed a pyschological barrier then it will probably continue to fall.[/quote]That's journalist wannabe market speek JRC!Remember, many Central Banks hold large Sterling balances: and part and parcel of the whole ethos of fully floating fiat currencies, is the co-ordinated efforts made behind the scenes by IMF and Central Bankers to try and achieve some level of effective stability.Unless the government of a member state behaves so foolishly they allow speculators to take over for a short while: e.g. Normal Lament (I regret nothing) and the ERM fiasco back in 1992.Even speculators such as Soros and his Quantum Funds, cannot harness the same muscle as Central Banks and IMF together.In order to move relative currency values, if the CBs and IMF wish to move the value down, then they glut the market: for the reverse, they mop up vast volumes.At present and after the Trade Stats were released, it is pretty obvious that soon, Brown/Darling/B of E will be compelled to act to raise Sterling's value: the UK imports so much from the EU the trade imbalance just with EU reached € 4.9 billion.If not, then the mounting deficit will eventually cripple any chance of recovery in the foreseable term: the answer (Which Brown hates!) is simple: raise interest rates! In any case, since Government plans to float a vast new amount of prime debt by way of Gilts and with the bond market in the nervous state it is and as the price exacted from Greece for last week's float shows, new UK gilts (And they are at the short end too, as the market doesn't want the long dates like 20 and 25 years! Which tells you summat else.), will demand a high rate of return to get all this new paper away: ergo, LIBOR (London Interbank Offered Rate: the rates at which banks lend to and borrow from each other) is already disconnected from the risible .5% Base Rate and will rise sharply.As will the rates we pay to borrow as individuals and businesses. One notes the mortgage rates have already started creeping up for new deals......I well remember the massive sudden surge of the US Dollar back in 1984: when I was working in California for a spell. Life was rather expensive as parity between the £ and US$ drew near!It didn't last, of course: it was a bubble and soon corrected.US$ against Pound Sterling:United Kingdom, 1983 - 198619830.6596 British Pound19840.7479 British Pound19850.7710 British Pound19860.6812 British Pound Link to comment Share on other sites More sharing options...
Quillan Posted March 10, 2010 Share Posted March 10, 2010 Funny when you get two financial techno geeks rabbiting away in a forum. All those anagrams obviously cleverly designed to keep us all mystified. I always like the Bird and Fortune explanation.I see the biggest dip was around 09:30 this morning for some strange reason. I wouldn't like to say its the reason but I see Northern Rock released its figures around the same time...Loss-making Northern Rock to give staff £15m bonusApparently they are getting these bonus's because they have not made such a big a loss as the previous year! Now I am a bit nieve, I admit that quite openly, but if I were running a business (and I have, quite a succesful one) thats making a loss, even though its not as bad as last year, I don't think I could justify or afford to pay anyone a bonus. If they turned a loss in to a profit well then yes because I would have the money to pay for it. In this case however the bank is primarily owned by the public, the tax payer, so yet again guess who's going to really pay. But then of course they will say that being given the £26bn of tax payers money already the 15M is just a pee in the ocean. Oh how I wish I was working in the banking/finance industry, you can never loose."Bonus Day" at Societe GeneraleMind you the English banks are not the only ones, a trader for BNP Paribas has just received at 10M Euro bonus, guess which city he works in, why London of course. I see a German chap has just got a 5.9M Euros bonus as well, both are dealers.France enjoys the resumption of international tradeI see France has issued it's balance of payments accounts for January and the deficit between imports and exports has dropped again. Still away to go but its slowly getting there. Link to comment Share on other sites More sharing options...
velcorin Posted March 10, 2010 Share Posted March 10, 2010 The minor improvement in the French balance of payments, is bizarre, considering what happened to Germany's, which is by far their biggest trading partner. Probably double counted a couple of Airbus planes, which are priced in USD, so when converted to EUR would show a nice little improvement[:D] Link to comment Share on other sites More sharing options...
Gluestick Posted March 10, 2010 Share Posted March 10, 2010 velcorin, you are almost as cynical as moi![:D] Link to comment Share on other sites More sharing options...
Gluestick Posted March 10, 2010 Share Posted March 10, 2010 [quote user="Quillan"]Funny when you get two financial techno geeks rabbiting away in a forum. All those anagrams obviously cleverly designed to keep us all mystified. I always like the Bird and Fortune explanation.I see the biggest dip was around 09:30 this morning for some strange reason. I wouldn't like to say its the reason but I see Northern Rock released its figures around the same time... [/quote]Or even acronyms, Q..............[:P]That said, surely anyone who seeks to expound on currency exchange rates/prospects must surely know what ERM stands for??Or are people's memories really that short?[8-)] Link to comment Share on other sites More sharing options...
Bugsy Posted March 10, 2010 Share Posted March 10, 2010 [quote user="Gluestick"]............................it is pretty obvious that soon, Brown/Darling/B of E will be compelled to act to raise Sterling's value: [/quote]We kinda hope you're right GS. Link to comment Share on other sites More sharing options...
Gluestick Posted March 10, 2010 Share Posted March 10, 2010 Well, if not Bugs, for those of still living mainly in the UK, then we're toast.'Cos we import vast amounts of essentials now: even electricity from EDF France. Link to comment Share on other sites More sharing options...
Jako Posted March 10, 2010 Share Posted March 10, 2010 [quote user="Gluestick"]Remember, many Central Banks hold large Sterling balances: and part and parcel of the whole ethos of fully floating fiat currencies, is the co-ordinated efforts made behind the scenes by IMF and Central Bankers to try and achieve some level of effective stability.[/quote]2008World reserve currenciesUS$64%Euro26.5% Sterling4.1%Even in the 'good' year 2008 sterling was only 4.1% of the world reserve currencies. The "large Sterling balances" are negligible [:P] Link to comment Share on other sites More sharing options...
velcorin Posted March 10, 2010 Share Posted March 10, 2010 The trend has been noticably upwards over last 20 years, wiped out SFR and YEN. And If you just take the reserves of Norway, Adu Dhabi and China.........I'd settle for 4.1% of USD 4trillion[:D] Link to comment Share on other sites More sharing options...
Gluestick Posted March 10, 2010 Share Posted March 10, 2010 Sterling has not been technically a "Reserve" curency since the 1970s.However read this and ponder:ABSTRACTWith net overseas assets of well over $100bn the UK is now the world's second largest creditor nation after Japan. This has come about because the UK current account benefited from large-scale oil revenues from 1980 onwards, which produced a series of current surpluses. Fortunately the funds were invested overseas at a time of significant recovery in world equity markets. As a result of the increase in its external assets, the UK now receives £5bn p.a. or more from interest, profit and dividend earnings on these assets - a valuable cushion to the run-down in oil revenues.Do you really think the global capital markets will allow such value to collapse?Additionally, you must distinguish between US dollars: and external US $. Link to comment Share on other sites More sharing options...
NickP Posted March 10, 2010 Share Posted March 10, 2010 Like most people all I'm interested in is the price of the pound against the Euro. So thank you chaps for sharing your wonderful knowledge of the technicalities of international finance, with the uneducated, namely me. Although I've tried hard to follow your eloquent offerings I'm not any the wiser as to the ins and outs of finance, all this these clever theory's and opinions have given me a headache, so I'll go and have a lie down . P.S. please let me know when it's safe for me to go shopping again. I apologise for being a bit thick but I'm only an old manual worker who is trying to balance his life style and his pension and to be quite truthful I am now totally confused. [:P] Link to comment Share on other sites More sharing options...
Quillan Posted March 10, 2010 Share Posted March 10, 2010 [quote user="NickP"]Like most people all I'm interested in is the price of the pound against the Euro. So thank you chaps for sharing your wonderful knowledge of the technicalities of international finance, with the uneducated, namely me. Although I've tried hard to follow your eloquent offerings I'm not any the wiser as to the ins and outs of finance, all this these clever theory's and opinions have given me a headache, so I'll go and have a lie down . P.S. please let me know when it's safe for me to go shopping again. I apologise for being a bit thick but I'm only an old manual worker who is trying to balance his life style and his pension and to be quite truthful I am now totally confused. [:P][/quote]Look pal get to the back of the queue with the rest of us. You would think they would have work to do like getting us all out the shite instead of trying to out do each other with technical stuff that only they seem to understand. Of course they might be Bird and Fortune in disguise for all we know [;-)] Link to comment Share on other sites More sharing options...
Swissie Posted March 10, 2010 Share Posted March 10, 2010 If you want good advice on what to do, just ask us what WE do - and do exactly the opposite. Guaranteed to work. Link to comment Share on other sites More sharing options...
just john Posted March 10, 2010 Share Posted March 10, 2010 I thought the hot money was going on the Sfr, you should know?[blink] Link to comment Share on other sites More sharing options...
Swissie Posted March 10, 2010 Share Posted March 10, 2010 You mean CHfr! But OH's pension is paid in £ (and so will mine when I get it) - and so are our savings! A high ChFr is not helping much at the mo! When we decided to buy our house here, the £ was 2.40 and now it is 1.62. We also had to take a 23% drop to sell our house in UK. Not complaining ... but!CH = Confédération Helvétique = Switzerland Link to comment Share on other sites More sharing options...
bubbles Posted March 10, 2010 Share Posted March 10, 2010 Which reminds me of my daughter's observation when we were driving down through france one year:"There's lots of Chinese cars around aren't there!"Took us a few minutes to realise what she was talking about. We never let her forget it.(She also thought for a while that Jaws was called George!!) Link to comment Share on other sites More sharing options...
allanb Posted March 11, 2010 Share Posted March 11, 2010 [quote user="NickP"]I apologise for being a bit thick but I'm only an old manual worker who is trying to balance his life style and his pension and to be quite truthful I am now totally confused. [/quote]There's no need to be either confused or depressed. Most of the "experts" are just repeating twaddle written by journalists, and if journalists really had any ability to predict exchange rate movements they wouldn't need to scratch a living as journalists.They are of course very good at explaining why something happened, but only after it's happened, which makes their advice fairly useless. After all, when the result of a horse race is known, I can tell you exactly how you could have made money on it. Link to comment Share on other sites More sharing options...
Gluestick Posted March 11, 2010 Share Posted March 11, 2010 [quote user="NickP"]Like most people all I'm interested in is the price of the pound against the Euro. So thank you chaps for sharing your wonderful knowledge of the technicalities of international finance, with the uneducated, namely me. Although I've tried hard to follow your eloquent offerings I'm not any the wiser as to the ins and outs of finance, all this these clever theory's and opinions have given me a headache, so I'll go and have a lie down . P.S. please let me know when it's safe for me to go shopping again. I apologise for being a bit thick but I'm only an old manual worker who is trying to balance his life style and his pension and to be quite truthful I am now totally confused. [:P][/quote]Which then, if you think about what you have said, shows really just how easy it is for politicians, their Off-The-Wall New Wave Economics advisers and those representing the Financial Disservices Industry to employ BS to baffle voters and persaude them how and why they are able to square the Fiscal Circle![:)] Link to comment Share on other sites More sharing options...
Quillan Posted March 11, 2010 Share Posted March 11, 2010 Alan - Couldn't agree more but you did leave one important bit out, complete denial when things go wrong "not my fault mate it was the other fella".I also think the warning they give us plebs about "the value of your shares can go down as well as up" should be changed to "the value of your shares can go up as well as down". [;-)] Link to comment Share on other sites More sharing options...
Sprogster Posted March 11, 2010 Share Posted March 11, 2010 There is an increasing line of thought amongst UK political and economic commentators, that Brown is perversely trying to make out that the UK economy is in worse shape than it really is, to boost his electoral chances, by supporting his arguement to delay spending cuts. If you look at the narrowing gap in the opinion polls it bizarrely seems to be working! For example, on key areas such as unemployment the current UK rate of 7.8% is much better than most other EU countries and the USA. The attached Bloomberg link explains further. http://www.bloomberg.com/apps/news?pid=20601087&sid=at2Ty68anpgo&pos=5 Link to comment Share on other sites More sharing options...
Recommended Posts
Please sign in to comment
You will be able to leave a comment after signing in
Sign In Now