Sterling - Dollar Parity?
Discussion
Although I'm a bit of a pleb, each Sunday I have brunch in Hampstead with a couple of old friends.
One is a Belgian, he's an ex CEO of a footsie 250 company, the other, a German, is pretty high up in Deutsche Bank's international investment trading thingy.
Anyhow, in between setting the World to rights and slagging off Britain's Winter Olympic team, these guys got to talking about the future for Britain and Sterling in particular.
Their view is that Sterling will have to be devalued enormously after the coming election. My investment banking mate even ventured to say that something quite close to parity was a possibility.
They really held out little hope for our economy, comparing us to Portugal, Spain and the other Euro crisis countries.
I found the whole thing fascinating, albeit pretty worrying.
Pound Dollar parity?
What would that do to our economy then? I can see that it would help our exports and dampen home demoand for imported products, but is devaluation a good thing?
One is a Belgian, he's an ex CEO of a footsie 250 company, the other, a German, is pretty high up in Deutsche Bank's international investment trading thingy.
Anyhow, in between setting the World to rights and slagging off Britain's Winter Olympic team, these guys got to talking about the future for Britain and Sterling in particular.
Their view is that Sterling will have to be devalued enormously after the coming election. My investment banking mate even ventured to say that something quite close to parity was a possibility.
They really held out little hope for our economy, comparing us to Portugal, Spain and the other Euro crisis countries.
I found the whole thing fascinating, albeit pretty worrying.
Pound Dollar parity?
What would that do to our economy then? I can see that it would help our exports and dampen home demoand for imported products, but is devaluation a good thing?
I'm no expert but it doesn't take Brain of Britain to work out the we are in for a rough ride after the election (regardless of who gets in).
The US and Europe are in no great condition either so perhaps the status quo will be maintained to a degree.
A devaluation may actually help us if we offer a 30% increase in cost effectiveness due to Dollar parity.
Whatever happens we have to deal with it.
The US and Europe are in no great condition either so perhaps the status quo will be maintained to a degree.
A devaluation may actually help us if we offer a 30% increase in cost effectiveness due to Dollar parity.
Whatever happens we have to deal with it.
Simpo Two said:
If I was Chancellor I'd just print £1.7T and pay off the National Debt with it...
Any problems with that?
isnt that what the Americans did in 1971 when they came off the gold standard, and just started printing as much as they liked LOL Any problems with that?
...it dosent seem to have worked out exactly to plan though .......
andy-sw said:
Am I correct in saying that would only cause inflation?......
Well, it wouldn't be going into the economy, it would go straight to the IMF or whatever, so out of the equation. I think that some situations, especially finanical, get so complex with time that, like an old house with 10 layers of wallaper, you have to strip it all off and start from scratch again.TDIPLC said:
I'm no expert but it doesn't take Brain of Britain to work out the we are in for a rough ride after the election (regardless of who gets in).
The US and Europe are in no great condition either so perhaps the status quo will be maintained to a degree.
A devaluation may actually help us if we offer a 30% increase in cost effectiveness due to Dollar parity.
Whatever happens we have to deal with it.
OT Just looked at your profile, when I was younger always looked at your website for turbo options! Didn't realise you were on here The US and Europe are in no great condition either so perhaps the status quo will be maintained to a degree.
A devaluation may actually help us if we offer a 30% increase in cost effectiveness due to Dollar parity.
Whatever happens we have to deal with it.
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