Brexit, for once some facts.
- Thread starter flecc
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Gosh, did you write that yourself or did you need some help from OldTom?Sums it up doesn't it?
Not the answer to your question. However, you might want to reflect on it?
"Sterling’s fall following the ERM exit did trigger an export recovery, says Kit Juckes at Société Générale. It plunged nearly 35 per cent against the dollar in the six months after Black Wednesday, driving up export volumes and wiping out the trade deficit. Its decline “sowed the seeds of a better economy”.
pick away if you like. I like some of the things that EU created but I am not mad keen for it.
I think people should be more critical before saying that brexit is wrong.
I appreciate that... but as you say it doesn't answer my question in anyway shape or form and does some what lead onto the point I wanted to make.
There is no indication at all anywhere, that the devaluation of the £ was a deliberate or even positive act. We are a nation of importers.
The fact inflation is rising faster than wages and we already have pretty much full employment does somewhat suggest that even if it was a plan, it wasn't a sensible one. We hadn't had another black wednesday., that I'm aware of.. Brexit is supposed to be a positive isn't it? Or so you keep telling us, so why the need to collapse the currency, if its all going to be milk and honey??
Which is it?? You think its a good thing, and you're now comparing it to Black Wednesday....
Do you see my confusion
See above ...
But just to be clear.
What gives you the impression it was a choice made by the UK?
and
Why the need to collapse the currency when you think Brexit is a positive?
you added this bit after I replied, but its VERY important so I'm going to reply.
This is at the heart of my issues.
You think I should be more critical before I say its wrong...
I'd argue you're asking me to sign up to something you yourself don't even have a grasp of. What is Brexit??
No deal? Norway style? or something else... I know you might know what you want it to be, but there are 17 million of you guys who voted for this and you all have very different ideas. So how am I supposed to be in favour of something that hasn't even been agreed yet?
In many ways it's irrelevant. The pound against other currencies goes up and down most days of the week, as do Stocks and Shares. However, with Brexit that brought uncertainties and it went down. OK, imports, some, not all, are more expensive, but our exports are cheaper, so we sell more - that's good for 'real' jobs and there are still plenty of them. Fear not, the Pound will rise again and in many way Harold Wilson, was right. You might have noticed that out tax revenues went up the last quarter so much so that the deficit was significantly reduced.
ah, which imports haven't gone up?? They are all paid for in other currencies, so they all have gone up.
and which exports have benefited?
Because the ONS - don't seem to show any surge in exports at all. If you can show me some figures that show that we've seen a growth in exports, I'll happily read it.
https://www.ons.gov.uk/economy/nationalaccounts/balanceofpayments/bulletins/uktrade/june2017
When the result was known, the obvious reaction is to sell anything owned by the Brits or linked to the Brits.
The BoE rehearsed that scenario months before and decided to let the market know that it will pump liquidity into British banks, that means it signaled to the market to sell Pound instead of FTSE shares because the Pound is guaranteed to sink. Shemoz canconfirm this, he made a packet on the day.
Britain’s factories benefited from a surge in sales to the EU in the first half of this year as export growth outstripped import growth.
The UK still imports far more than it exports leaving the country with a goods deficit amounting to €53bn (£48bn) for the six months to June in its trade with the EU, but that is down from €57.8bn in the same period of 2016.
A weaker pound meansBritish-made goods are more competitive abroad, while imports are more expensive to UK companies and consumers.
Britain exports €104bn of goods to the rest of the world, outweighing the €94.7bn of goods it sends to EU customers. But UK imports from the EU amount to €147.7bn, while those from elsewhere come in at €134.7bn.
The UK's total trade deficit has shrunk from €102.2bn in the first half of 2016 to €83.7bn this year.
The Pound is up 8% in Argentina!
you've made some statements, that I'm not disagreeing with.
What you've not done is explained how the UK made the £s value fall.
and you've also not explained why it would need or want to fall, if Brexit is a positive?
If it was a positive thing surely it would increase the value of our currency, its just been compared to Black Wednesday by someone pro Brexit... do you not see why that doesn't add up??
ok you've quoted some text from the Telegraph... There doesn't seem to be evidence of a surge when you actually look at the data though. The ONS says this:
- Despite higher trade prices and weaker sterling, there were similar increases in export and import volumes of goods, by 5.0% and 4.8% respectively, in Quarter 2 2017 compared with the same period a year earlier.
https://www.ons.gov.uk/economy/nationalaccounts/balanceofpayments/bulletins/uktrade/june2017
There is a nice graph, which took me a whilst to grab. It shows growth in exports and imports, running roughly parallel
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brexit has not happened yet, what we see is loss of confidence for the moment, the definitive market sentiment will be made when the negotiation with the EU comes to the end.
Confidence comes and goes. The BoE knew that the brexit result will cause flight of assets denominated in GBP. So it explained to the market what it would do so there won't be a flash crash. By telling the market that it won't change rate and will pump liquidity into the market instead, it made the Pound the designated target for the traders. Thus protecting the real economy.
The value of the Pound is usually underpinned by FDI. With money pouring out of London, the Pound sank.
When a deal with the EU is confirmed, confidence will come back. We have a flexible economy, established democracy and well developed justice system, there is no reason why London won't get back what it lost temporarily since the vote.
lol, really... you've never imported from Argentina I take it? the physical cost of an item is a % of the cost of getting it here. So even if the cost of the item has dropped 8% if the import costs / fuel / staff etc etc have all gone up.. The import will still cost more to the consumer in the UK.
I think racism is no basis on which to cast a vote on the economic future of one's country by saying 'remain' is wrong.
Tom
and what if it gets worse? At what point might you think it is a bad idea? Because I'll be happy to admit I was wrong if it does turn out better.
You are assuming again OG. I,ll state again, if we had a second ref I,d vote remain, not because I don't think we will prosper out of EU ( If PH thinks we will who are you and I to disagree) but to help prevent the divisive route current remainers have forced us down. In interests of unity I,d vote remain, but I fully support leaving. Its not that complicated OG, but then again it doesn't have to be to confuse some..