Is that what this rout is all about?
British pound is down nearly 300 basis points from the highs this morning. Why? Because Labour Party candidate, Ed Miliband, is now favored to replace David Cameron in next week's elections?
Really?
As if Cameron has been good for the pound? As if growth has been anything but terrible under his leadership?
Dare I say it, but are we starting to (finally) witness the winds of change? Bernie Sanders. Hillary (jury still out on her). Bill De Blasio NYC, Miliband. Heck, I'll even thow in Tsipras and Syriza despite all their blunders.
Progressives...anti-austerians...pro-growth...
Plus...
Spreading outrage against police brutality. Even homicide charges brought against the cop in South Carolina who killed Michael Slager and now against the six cops in this new, Freddie Grey murder.
(Not like the fucking pathetic Staten Island Grand Jury morons and corrupt prosecutor in the Eric Garner case.)
And even this, I just learned...a bipartisan bill in both the House and Senate that seeks to roll back meta data collection by the NSA. BIPARTISAN!!!
Dare I say it? Are things starting to change?
P.S. I'd be buying the pound and I am.
9 comments:
Funny thing is that a weaker pound is likely to increase British "competitiveness" globally and result in higher employment.
They're importers Tom....
I'd perhaps agree with Mike on the trade here but imo even if the other guy wins, nothing is likely to change... so the terms should revert back to about where they were...
This could be specs doing this based on their ideology or "world view" and not what is going on wrt ex/im trade and ex/im trade terms...
rsp.,
well, they are importers because either their costs are too high or the pound is too high. Of course, the conservative view is that costs are too high, chiefly wages and employee benefits and protections. So a dropping pound is a good thing for labor by making exports less dear without reducing production cost.
Theoretically, anyway.
Weaker pound=higher import costs
Wages are too low(lots of foreign labour pushing down local wages),rents are high though.
Miliband is not an anti-austerian he is a centrist Neoliberal who sees deficit reduction as very important.he's completely clueless.he's talking out of his are.he hasn't said any serious shift in politics.his deficit reduction is just supposed to be fairer.at least he's going to tax mansion over £2 million.other than that he is the same old centrist/neoliberal.The only thing in his favour is that he isn't a Tory.
It's always a good idea to check the historic exchange rates over a longer period of time.
Currency traders have too short a time horizon. Business works in months and years.
My favourite page for FX perspective is this one
What I am alluding to is that if fx rate falling increases exports (and jobs), then the conservatives will take credit for austerity "working its magic." Just watch them.
Tom you could probably try to give Fords away in Japan and they wouldnt take them...
Tell a German they should drive a Chevy instead of a Daimler or BMW .... good luck!
rsp,
In fact try to tell a BMW or Benz driver HERE that they should buy a Chrysler. ... good luck!
When I was in China, all the Mazda 626 had Ford ornaments on them... they wont buy Japanese. ...
Try to sell Boeing in Europe. ... yet we have JetBlue that uses Airbus all the time...
Some nations are willing to buy imports and others are not...... these are the kinds of cultural things that Obama thinks he can overcome with his TPP ... ... I dont give it much chance...
Rsp
Mike,
As a Brit, here's the deal: Mlliband is a gawky Tory. Having given assurances that he would support military strikes on Syria, he then inadvertently scuppered the carefully crafted lies about Assad gassing "his own people"! Either he's a Machiavellian genius or he's a clumsy goofball.
Domestically, he's now promising to have "fairer cuts" than the allegedly wicked Tories and guarantees to "cut the deficit every year". EVERY YEAR. Even the Tories aren't promising this Tea Party stupidity.
Labour has been a Tory Party for about twenty years or so, and on some issues they're so far to the right the Tories play catch up.
The only progressives in the UK are the Greens, and many of their policies are at best naive. We're in a lot of trouble. But it could be worse. I could be a progressive in America!
My prediction is that soon after the election the economy will crash. There's just too much private debt and inequality for the whole thing to continue. And that's before you add to the mix the real unemployment figures, let alone the under employed.
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