The Pound is a-sinking

[SantaClaus]

Abandon ship, abandon ship

New Liebour sheep voters, repent.

We could see GBPUSD at the year 2001 lows of 1.3680 shortly, then next stop is 1.3380

The BOE printing money has diluted the value of the currency and scared investors away from the UK.

Bye Gordon, it was (not) nice knowing you!

[BrilloPad]

Isn't a sinking pound a good thing rather than a bad thing?

[ace00]

Isn't a sinking pound a good thing rather than a bad thing?

I think so. It goes something like this:

1. Debt
2. Devalue
3. Inflate
4. Recover

That's over about 5 year period. Best case.

[Gonzo]

Isn't a sinking pound a good thing rather than a bad thing?

It makes exports more price competitive internationally, and that can only be a good thing.

That is assuming the country still produces anything for export that is.

It makes imports more expensive and so that would push up prices and inflation, and that is a bad thing.

That is assuming that people still have any money left to buy imports at all that is.

[TimberWolf]

I think so. It goes something like this:

1. Debt
2. Devalue
3. Inflate
4. Recover

That's over about 5 year period. Best case.

I wish I could remember more from O level economics now. It seemed carp at the time but I suspect was quite sensible now compared to current economic theory, which goes:

1. Boom
2. Goto 1
3. How the heck did we get here. Goto 1!
4. Confused. Goto 1. ffs
5. Feck
6. Here be dragons

[sunnysan]

Good/Bad

Isn't a sinking pound a good thing rather than a bad thing?

I think this has been discussed quite extensively but I believe the general argument is that since UK is a net importer of goods, how can the devaluation of sterling be as good thing.

[expat]

I think this has been discussed quite extensively but I believe the general argument is that since UK is a net importer of goods, how can the devaluation of sterling be as good thing.

To persuade us to stop buying so many imported goods?

[DimPrawn]

Even if you are an exporter a weak (or dead) pound means the raw materials and your energy costs (imported) are much much higher.

If you take copper and steel for example and produce widgets for export, the cost of the raw materials and the energy to produce the widget is going to be very costly.

[Solidec]

DOOMED!

I hope its transitory though, gonna cash in my US shares if pound hits $1.20 and steadies. £:$ would be insane!

[d000hg]

I definitely need to get a $ business account...