economic doom

[Mich the Tester]

And with the US market closed the UK has lost its AAA rating. We are now just AA1 with Moody's. PR release here

That's because the British government had to spend gazillions of pounds rescuing banks that had poured money into stuff that Moody's had stamped 'AAA'.

[jamesbrown]

Go ahead.

However, credit agencies merely reflect what the markets already say so sterlings drop over the last month was the market pricing the news in

To a large degree, the broader markets have priced this in, but there are several factors weighing on Sterling at present. For one, it seems like the Fed and the BoE are now on different trajectories and the markets are always pricing future action rather than the current situation. Loss of the triple AAA places a further unwanted spotlight on the state of the UK finances (even though it was expected) at a time where negative sentiment is rife and a lot of the "safe haven" flows from Europe to the UK have reversed. I think there's still room for the Sterling to fall against the Dollar and Euro (look at the net Sterling positions), and Cable was already down ~1% in the last minutes of New York trading.

[jamesbrown]

I think this comment from the Telegraph says it all:

You'd think that after yet another reminder of their gormless, incompetent leadership of late, that Cameron and the trust fund lads and lasses would for once gain enough elementary insight to take the obvious steps the British public have been urging for 20 years now: halt the runaway immigration to our overcrowded island, crack down on our grossly abused asylum system, stop sending billions of £ to the corrupt governments in India and Bangladesh while pushing austerity for us, stop letting his crooked bankster mates siphon off our wealth and sell the rest of us down the river, stop offering child benefit and free council housing to every scammer and job-stealer from south of the equator, preserve our vanishing open spaces, stop outsourcing what's left of British industry to India while leaving our young generation to rot...

But it won't change. It never will. There is no "conservatism" in the major parties in its traditional sense, only the greed-filled, neocon, globalist corruption that masquerades as such. This is why the UK continues to be ruled by this grotesque alliance of short-sighted, cheap labour-obsessed big business and the Frankfurt School extreme Leftists, in the mould of the dangerous Antonio Gramsci. It's because our elites whatever their ideology on the surface crave the same thing: a full collapse of traditional British society, ties of blood and culture, and social cohesion, with them as the self-styled, cosmopolitan lords ruling over us Little Englander serfs in their minds. Our own elites are in bed with the neocon globalists in control of the United States, Barclay's hand-in-hand with Goldman Sachs looting the livelihoods of the mere commoners whom they so scorn. Cameron and Blair are from the same line of insulated, scornful aristocrats who ruled over the British Empire, who were themselves a direct line from the idle Norman bluebloods who've always seen the British masses as beneath them. Now they've taken their contempt one step further, scheming to get rid of our communities altogether.

The sad truth is that without a revolution, there's little we can do to fight back, we're too consumed by bare survival to do much more.

I myself am in Chile now and am surrounded by dozens of my mates from University, here in Valparaiso alone. Millions more of us are scattered about in South America, from Brazil to Argentina and Panama, Colombia to Ecuador, closer to home in Switzerland or Germany (where the countries truly value their native skilled labour) or the traditional exile haunts in France, Spain, Holland or Italy, still more of us in Dubai or China, Korea or Thailand.

This isn't what we wanted, but younger Britons in particular have no future in the UK because Cameron and the other Lib-Lab-Con sell-outs don't want us native Britons there. Especially those of who are technically trained and able to do useful work. We will never be the serfs they want, so they crush us with school loans and debt, flood our towns with millions more on our already crowded island, ship out the rest of our jobs to India and leave us with nothing.

We in the Diaspora are the productive core of Britain. We're engineers and other skilled types, we're making a good living whether we're in Chile or France or Switzerland, despite the stereotypes we blend in with our surroundings, speak Spanish or French or German or whatever we have to. This is what Britain, and England in particular, is losing as a direct result of the corrupt vampire elites who continue to drain the lifeblood of our nation.

I hope he understands the irony of ranting about immigration from Chile.

[doodab]

This is excellent news as I'm expecting a fairly sizeable tax refund from my time in Germany. C'mon you hopeless tories, get us back to parity!

[sbakoola]

What bearing does this credit rating downgrade have on the price of English homes and the ease with which the man on the street can get credit in the UK ? Any economists out there ?

[eek]

and with the markets fully open the market reaction is in:-

Cable dropped a total of 1c (an indifferent NFP slightly different to expectations will change it more than that).
FTSE up +35.84 (+0.57%)

So well done AussieFool. The markets reaction is one of Meh.

[eek]

What bearing does this credit rating downgrade have on the price of English homes and the ease with which the man on the street can get credit in the UK ? Any economists out there ?

The some total of sweet FA.

[Martin@AS Financial]

What bearing does this credit rating downgrade have on the price of English homes and the ease with which the man on the street can get credit in the UK ? Any economists out there ?

Other than being embarrassing on the world stage, it may not effect the price of homes. Government schemes such as funding for lending are currently ensuring that the cost of mortgages are historically low in a bid to get the housing market back on an even keel.

Whilst lenders need to be seen to be lending (if they have signed up to FLS), one way they can restrict the flow of business is to tweak the credit score on the application. Essentially they then get to cherry pick the client by declining anything that doesnt meet the new credit score card. However, this method is nothing new. It will be interesting to see how this pans out over the next 6 months.

[DimPrawn]

Even economic doom is rubbish these days.

1976 sterling crisis

James Callaghan came to power in 1976. He was immediately told the economy was facing huge problems, according to documents released in 2006 by the National Archives.[22] The effects of the 1973 oil crisis were still being felt, with inflation rising to over 27% in 1975.[23] Financial markets were beginning to believe the pound was overvalued and in April of that year The Wall Street Journal advised the sale of sterling investments in a story titled "Good-bye Great Britain". At the time the UK government was running a budget deficit and Labour's strategy emphasised high public spending. Callaghan was told there were three possible outcomes: a disastrous free fall in Sterling, an internationally unacceptable siege economy or a deal with key allies to prop up the pound while painful economic reforms were put in place. The US government feared the crisis could endanger NATO and the European Economic Community (EEC) and in light of this the US Treasury set out to force domestic policy changes. In November 1976 the International Monetary Fund (IMF) announced the conditions for a loan, including deep cuts in public expenditure.[24]

1979–1989

The Conservative Party was elected to power in 1979, on a programme of fiscal austerity. Initially the pound rocketed, moving above US$2.40, as interest rates rose in response to the monetarist policy of targeting money supply. The high exchange rate was widely blamed for the deep recession of 1981. Sterling fell sharply after 1980; at its lowest, the pound stood at just $1.03 in March 1985, before returning to the $1.70 level in December 1989.

[eek]

Even economic doom is rubbish these days.

I was actually being sarcastic. Losing a credit rating that means sod all is only news because people want to make it news.