Reply to: economic doom

[Doggy Styles]

Yes good rant by a pub bore. Bet he's got no mates in Chile either.

Life's a struggle wherever you are, and I'd rather not have people like that in the trenches with me.

BTW Speaking of Anglophobes, whatever happened to scooterscot? I imagine him tucked away somewhere in Germany, gazing wistfully at a picture of his old Britain In Europe heroes.

[jamesbrown]

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.

There was a degree of "meh" on this - perhaps more so than I was anticipating - but it's not too surprising (for example, any near-term re-balancing in Cable that hadn't already been priced in appeared to happen late on Friday). I'd be watching Sterling in the coming weeks though and wouldn't be surprised to see Cable testing 1.5 and eventually falling lower. This is just one of a string of factors weighing on Sterling at present. Like others mentioned, the FTSE comprises global companies, so absolutely no surprises that the FTSE said meh. Also, flows there and in currencies are still largely being fueled by central banks, not the ratings agencies.

[The Spartan]

Hopefully Dept. of Justice will be successful in suing S&P

[vetran]

organisations that were responsible for making sure that nations were credit worthy and missed every nations credit card was maxed out and their house over valued.

yeah totally relevant.

[DodgyAgent]

If only....

trust the BBC to put a negative spin on the Aussie success. good luck to them they need something to counter their failings at sport

[Troll]

Australia still has its AAA rating.

If only....

[The Spartan]

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'.

WMTTS

Who is inclined to believe these idiots

[Doggy Styles]

Australia still has its AAA rating.

[aussielong]

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.

I'm long AUDGBP. I'm making money off the pound every day, while you enjoy devalueing savings. Sorry about your "les organes génitaux de bébé", but don't take it out on me MrAngry

[DimPrawn]

FTSE up 1.36%, looks like the markets either don't care, or realise that the ratings agencies are no longer relevant.

No, markets know that most of the FTSE 100 income is not in Sterling, so profits in Sterling will rise.

[SimonMac]

FTSE up 1.36%, looks like the markets either don't care, or realise that the ratings agencies are no longer relevant.

[sasguru]

It says feck all that hasn't been said by blokes down the pub for decades. I'm glad he's fecked off to Chile.

Yes good rant by a pub bore. Bet he's got no mates in Chile either.

[DimPrawn]

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

I know. UK has been on downgrade watch for ages, so the recent demise of the pound is mostly priced in already.

[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.

[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.