Salmond "We can take Scotland in two weeks"

[scooterscot]

There are some nice buildings in Paisley. Yes, it's a tuliphole, but you'd never guess by just driving through it. The trip might take a couple of years off your life - a bit like a bus tour of Chernobyl - but the pictures will last a lifetime...

Lol;-) so true


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[Old Greg]

Odds are shortening but you can still get 21/10 on a Yes vote. Starting to look like a good bet.

5/2. I'm in. Will make the taste even better.

[Batcher]

You can't reason with this level of stupidity.

I think you should drop out the thread now and leave the debate to the grown-ups.

[Old Greg]

I think you should drop out the thread now and leave the debate to the grown-ups.

Good idea. What's the plan for iScotland currency arrangements, Batcher?

[Batcher]

Good idea. What's the plan for iScotland currency arrangements, Batcher?

KUATB

[Old Greg]

KUATB

Yes, I think there will be CU as it's on the best interests of both sides. If not, we will use the £ anyway but the value will go down as rUK will have lost a chunk of it's GDP and the income it receives from Scotland to pay off it's debts.

I don't think there will be CU.

So do you mean iScotland would use the GBP in the way Panama uses the USD? I.e. Scotland would not have its own currency?

[centurian]

So do you mean iScotland would use the GBP in the way Panama uses the USD? I.e. Scotland would not have its own currency?

The Panama option would be viable - if it were not for the fact we (both Scotland and rUK are running a big deficit) - a large chunk of which was caused needing to bail out Scottish banks.

With the Panama option, you have to run a budget surplus, or a small short-term deficit - and Scotland just can't do that at the moment - Oil revenues will pay most of the bills, but not all.

Panama currently has a 4% budget deficit, which is worryingly high (although small compared to our 8% deficit) - they can get away with that for a while, because they can borrow dollars.

6 months after independence, where will the money come from to pay benefits, pensions, public sector salaries. If they are going to pay in rUK pounds, they have to buy them on the open market - what will they buy them with. The credit rating will be shot if they walk away from the debt and they have no central bank to print the money.

[TestMangler]

I don't think there will be CU.

So do you mean iScotland would use the GBP in the way Panama uses the USD? I.e. Scotland would not have its own currency?

Why don't you think there will be a currency union OG ? Cause Cameron and Milliband are saying it now ?

They also said there were no protests taking place in England against NHS privatisation. But we all know there are.

[Batcher]

I don't think there will be CU.

So do you mean iScotland would use the GBP in the way Panama uses the USD? I.e. Scotland would not have its own currency?

That's what I think will happen if the UK government carry through with their threats to ban us from a CU and therefore taking all the debt on by themselves.

[Old Greg]

The Panama option would be viable - if it were not for the fact we (both Scotland and rUK are running a big deficit) - a large chunk of which was caused needing to bail out Scottish banks.

With the Panama option, you have to run a budget surplus, or a small short-term deficit - and Scotland just can't do that at the moment - Oil revenues will pay most of the bills, but not all.

6 months after independence, where will the money come from to pay benefits, pensions, public sector salaries. If they are going to pay in rUK pounds, they have to buy them on the open market - what will they buy them with. The credit rating will be shot if they walk away from the debt and they have no central bank to print the money.

It is possible to borrow money on the markets with the Panama option, you just can't print your own money. Of course you also accept that interest rates are set in London, and that you may be ineligible for EU membership, see: BBC News - Scottish independence: Sterlingisation 'would threaten EU membership'

On one side of the argument we have from former EU economics chief Olli Rehn:

As to the question whether sterlingisation were compatible with EU membership, the answer is that this would simply not be possible, since that would obviously imply a situation where the candidate country concerned would not have a monetary authority of its own, and thus no necessary instruments of the EMU.

Mr Salmond describes sterlingisation as transitional. But to what?

The whole debate is very peculiar and I'm not sure what Salmond is playing at. The obvious model is a separate currency pegged to GBP, as Ireland did for many years post-independence.

Scottish independence: FM backs sterlingisation - The Scotsman