The £ again

[HeliCraig]

I amazes me that banks are still allowing their models to rule what they are doing.

The only models banks should be allowed are Airfix. Idiots.

[ace00]

The article http://marketoracle.co.uk/Article7526.html linked in sappatz's 1st December posting "comrade Brown bankrupting Britains" contains this slightly more precise formulation, with a graph:

However a break below £/$137.50 would target parity to the US Dollar, which will mean a 50% loss in the value of all assets for the duration of the bear market to parity and likewise 50% rise in the price of dollar imported goods and services and to a lesser degree from other countries, therefore highly inflationary.

Technical analysis I presume.
What a complete load of idiotic garbage.

[d000hg]

What does "£/$137.50" mean? I didn't any of that stuff about breaks either... translation anyone?

[expat]

However a break below £/$137.50 would target parity to the US Dollar, which will mean a 50% loss in the value of all assets for the duration of the bear market to parity and likewise 50% rise in the price of dollar imported goods and services and to a lesser degree from other countries, therefore highly inflationary.

Technical analysis I presume.
What a complete load of idiotic garbage.

Yes, I don't believe in TA either. It looks pretty in retrospect, except the bits where you needed it.

[ace00]

Yes, I don't believe in TA either. It looks pretty in retrospect, except the bits where you needed it.

Yep, actually it's a useful tool, but relying on it exclusively is just stupidity.
Answer previous question it is mis-typed, short for £1 =$1.3750.
And OP - most of the decline has happened - $2 -> $1.47
But a catastrophic run is a concern.

[BlasterBates]

There are support lines under Sterling or most currencies for that matter and if it drops below the stop loss will kick in. One can argue that is stupid but that's how crashes occur on a regular basis.

Currencies such as $ or EUR probably don't have these crash lines, as they are reserve currencies.

It isn't as stupid as you might think. Investors can and are prepared to take a hit, however there is a point where they pull out, even with losses as they consider better to have enough resources to take a new bet on the market, than basically go bankrupt or end up with a liquidity problem. This is the reason for the massive sell offs.

[Flashman]

Business is War.

The sooner we get to $1 = £1 the better.

Companies like Land Rover and Jaguar depend heavily on US sales. The fall in the value of the £ will give them the opportunity to discount heavily and might just be enough to save them from going out of business entirely

As the Euro and $ seem to be tracking each other. BMW, Mercedes etc will be unable to do the same

Die £ Die!

[BrilloPad]

The sooner we get to $1 = £1 the better.

Companies like Land Rover and Jaguar depend heavily on US sales. The fall in the value of the £ will give the opportunity to discount heavily and might just be enough to save them.

Die £ Die!

So you are not going abroad on holiday any time soon then?

[DiscoStu]

The sooner we get to $1 = £1 the better.

Companies like Land Rover and Jaguar depend heavily on US sales. The fall in the value of the £ will give the opportunity to discount heavily and might just be enough to save them.

Die £ Die!

Nooo! I'll never be able to afford a cheap US shopping trip again!

[TimberWolf]

The sooner we get to $1 = £1 the better.

That's been the exchange rate for some time now, from what I've noticed when looking at prices from across the pond, i.e. something that costs $1 is the US, costs £1 here.