Help . . . Is The £ Going Into Free-fall?

[MJP]

USD appreciating too fast. With their mentalfundas and the appreciation being purely technical (repatriation) surely USD is now a tightly wound spring.

I'm not saying you're wrong, but would you say the same about the Yen? Bad fundies and even greater appreciation. Euro, GBP, bad fundies too.

One thing about cycles is, they usually run to extremes.

Yes, too true. The whole global thing is a real mess.

UK's in absolutely DIRE trouble. With the resources it has (not much) and certainly the attitudes now in 'society', I really can't see even a medium term way out of this chaos.

Did you see Ken Clarke's comments in the Telegraph today?

[lannarebirth]

USD appreciating too fast. With their mentalfundas and the appreciation being purely technical (repatriation) surely USD is now a tightly wound spring.

I'm not saying you're wrong, but would you say the same about the Yen? Bad fundies and even greater appreciation. Euro, GBP, bad fundies too.

One thing about cycles is, they usually run to extremes.

Yes, too true. The whole global thing is a real mess.

UK's in absolutely DIRE trouble. With the resources it has (not much) and certainly the attitudes now in 'society', I really can't see even a medium term way out of this chaos.

Did you see Ken Clarke's comments in the Telegraph today?

I just have. You couldn't call him cheery:

http://www.telegraph.co.uk/finance/finance...f-meltdown.html

[MJP]

USD appreciating too fast. With their mentalfundas and the appreciation being purely technical (repatriation) surely USD is now a tightly wound spring.

I'm not saying you're wrong, but would you say the same about the Yen? Bad fundies and even greater appreciation. Euro, GBP, bad fundies too.

One thing about cycles is, they usually run to extremes.

Yes, too true. The whole global thing is a real mess.

UK's in absolutely DIRE trouble. With the resources it has (not much) and certainly the attitudes now in 'society', I really can't see even a medium term way out of this chaos.

Did you see Ken Clarke's comments in the Telegraph today?

I just have. You couldn't call him cheery:

http://www.telegraph.co.uk/finance/finance...f-meltdown.html

My best guess is an early budget, massive tax cuts, more IR cuts, lots and lots of VI rampling BS, an early election call (March/April), Labour to win with small majority.

Scary.

The Tories really need to sort themselves out. They still don't present a viable alternative. Cameron's passable, Osborne is vile!

Bring Ken Clarke, David Davis, William Hague forward and they win. Maybe they don't want it?

[neil324]

USD appreciating too fast. With their mentalfundas and the appreciation being purely technical (repatriation) surely USD is now a tightly wound spring.

I'm not saying you're wrong, but would you say the same about the Yen? Bad fundies and even greater appreciation. Euro, GBP, bad fundies too.

One thing about cycles is, they usually run to extremes.

Yes, too true. The whole global thing is a real mess.

UK's in absolutely DIRE trouble. With the resources it has (not much) and certainly the attitudes now in 'society', I really can't see even a medium term way out of this chaos.

Did you see Ken Clarke's comments in the Telegraph today?

I'm not saying its not bad and have'nt read the link, but he's a tory and an advisor to Cameron so he's going to say all that.

[spiderman2]

Dont worry about the "Pound" Flash Gordon and the BOE have got it under control, they slashed interest rates last week to give the consumer money in his/her pocket by way of mortgage relief, and to lower interest rates by 1.5% to get the most indebted consumer on the planet borrowing even more money.

With this extra cash we can buy lots of imported foreign energy and the cheap Chinese products, there is nothing to fear the UK economy will be booming in no time,

When we combine these with our thriving industrial strength and lack of dependency on a banking based economy, i think we will be ok.

Oh, hold on a minute...........

Edited November 12, 2008 by spiderman2

[MJP]

Dont worry about the "Pound" Flash Gordon and the BOE have got it under control, they slashed interest rates last week to give the consumer money in his/her pocket by way of mortgage relief, and to lower interest rates by 1.5% to get the most indebted consumer on the planet borrowing even more money.

With this extra cash we can buy lots of imported foreign energy and the cheap Chinese products, there is nothing to fear the UK economy will be booming in no time.

I know, they [Govt] just don't get it do they?

I remember Jim Puplava from FinancialSense.com predicting this some 18 months ago. Said towards the end of 2008 the US and other western countries would drop interest rates to near zero in response to collapsing asset values on which these incredible debts were leveraged and a temporary deflation.

By the end of 2009 inflation would be spiralling skywards, CB's would panic and there would be an interest rates race upwards to counter imported inflation.

Depression by 2010.

I've been trying to find the link for ages and will post it if I do. In the mean time have a look at this graph of US debt (total) to GDP. It supports Soros' claim that we are at the end of a super-boom that began in the 1950's which indicates we are heading into a K-Winter (Kondratiev Cycle depression phase).

http://en.wikipedia.org/wiki/Kondratieff_Cycle

I believe the snow of the Kondratiev Winter is now beginning to settle.

Oh and that graph. Takes us up to 2003. Heck knows what it is now. EDIT: To add, K-Cycles illustrative chart.

Edited November 12, 2008 by MJP

[chiang mai]

Dont worry about the "Pound" Flash Gordon and the BOE have got it under control, they slashed interest rates last week to give the consumer money in his/her pocket by way of mortgage relief, and to lower interest rates by 1.5% to get the most indebted consumer on the planet borrowing even more money.

With this extra cash we can buy lots of imported foreign energy and the cheap Chinese products, there is nothing to fear the UK economy will be booming in no time,

When we combine these with our thriving industrial strength and lack of dependency on a banking based economy, i think we will be ok.

Oh, hold on a minute...........

It's easy to be cynical - so the correct answer is? BTW, the strength or lack of in the Pound is not an issue.

[MJP]

Dont worry about the "Pound" Flash Gordon and the BOE have got it under control, they slashed interest rates last week to give the consumer money in his/her pocket by way of mortgage relief, and to lower interest rates by 1.5% to get the most indebted consumer on the planet borrowing even more money.

With this extra cash we can buy lots of imported foreign energy and the cheap Chinese products, there is nothing to fear the UK economy will be booming in no time,

When we combine these with our thriving industrial strength and lack of dependency on a banking based economy, i think we will be ok.

Oh, hold on a minute...........

It's easy to be cynical - so the correct answer is? BTW, the strength or lack of in the Pound is not an issue.

Hmmm, it is for some of us old boy.

[chiang mai]

Dont worry about the "Pound" Flash Gordon and the BOE have got it under control, they slashed interest rates last week to give the consumer money in his/her pocket by way of mortgage relief, and to lower interest rates by 1.5% to get the most indebted consumer on the planet borrowing even more money.

With this extra cash we can buy lots of imported foreign energy and the cheap Chinese products, there is nothing to fear the UK economy will be booming in no time,

When we combine these with our thriving industrial strength and lack of dependency on a banking based economy, i think we will be ok.

Oh, hold on a minute...........

It's easy to be cynical - so the correct answer is? BTW, the strength or lack of in the Pound is not an issue.

Hmmm, it is for some of us old boy.

...is not an important (priority) issue in the context of the posters alternate solution to the financial crisis.

[MJP]

Dont worry about the "Pound" Flash Gordon and the BOE have got it under control, they slashed interest rates last week to give the consumer money in his/her pocket by way of mortgage relief, and to lower interest rates by 1.5% to get the most indebted consumer on the planet borrowing even more money.

With this extra cash we can buy lots of imported foreign energy and the cheap Chinese products, there is nothing to fear the UK economy will be booming in no time,

When we combine these with our thriving industrial strength and lack of dependency on a banking based economy, i think we will be ok.

Oh, hold on a minute...........

It's easy to be cynical - so the correct answer is? BTW, the strength or lack of in the Pound is not an issue.

Hmmm, it is for some of us old boy.

...is not an important (priority) issue in the context of the posters alternate solution to the financial crisis.

Apologies, but isn't this thread about the collapse of Sterling and it's impact on ex-pats?

[chiang mai]

Just noticed, GBP/USD at 1.49 looks oversold and reckon a retreat is on the cards. That should help push GBP/THB back from the edge of 50 which is looming rapidly, currently at 52.x. Shameful.

[chiang mai]

Dont worry about the "Pound" Flash Gordon and the BOE have got it under control, they slashed interest rates last week to give the consumer money in his/her pocket by way of mortgage relief, and to lower interest rates by 1.5% to get the most indebted consumer on the planet borrowing even more money.

With this extra cash we can buy lots of imported foreign energy and the cheap Chinese products, there is nothing to fear the UK economy will be booming in no time,

When we combine these with our thriving industrial strength and lack of dependency on a banking based economy, i think we will be ok.

Oh, hold on a minute...........

It's easy to be cynical - so the correct answer is? BTW, the strength or lack of in the Pound is not an issue.

Hmmm, it is for some of us old boy.

...is not an important (priority) issue in the context of the posters alternate solution to the financial crisis.

Apologies, but isn't this thread about the collapse of Sterling and it's impact on ex-pats?

Er, no, it's about the strength of the Pound and whether it's going into free fall!

[spiderman2]

Dont worry about the "Pound" Flash Gordon and the BOE have got it under control, they slashed interest rates last week to give the consumer money in his/her pocket by way of mortgage relief, and to lower interest rates by 1.5% to get the most indebted consumer on the planet borrowing even more money.

With this extra cash we can buy lots of imported foreign energy and the cheap Chinese products, there is nothing to fear the UK economy will be booming in no time,

When we combine these with our thriving industrial strength and lack of dependency on a banking based economy, i think we will be ok.

Oh, hold on a minute...........

It's easy to be cynical - so the correct answer is? BTW, the strength or lack of in the Pound is not an issue.

Theyre cynical facts.

Correct answer is to have an economy not reliant on debt to purchase foreign goods, the housing market, and the banking sector (City of London), the answer is a far better education and tax system so we can lead the way in the new economies, as well as having a solid manufacturing base.

We're a service based economy its in our interest to have higher interest rates, unless Gordon and Merv are intending to bring back manufacturing.

The strength of the pound will be in issue when i and many 100s of thousands come to LOS next month and cant afford to spend like drunken sailors. Meaning restaurants and agogos laying off staff as i'll have to cook at my apartment and only be able to afford to short time lady coconut.

Anyway im ready for a downturn in the pound, ive been learning Indian so i can get a job in a callcentre when they export these jobs to the UK.

Edited November 12, 2008 by spiderman2

[MJP]

Dont worry about the "Pound" Flash Gordon and the BOE have got it under control, they slashed interest rates last week to give the consumer money in his/her pocket by way of mortgage relief, and to lower interest rates by 1.5% to get the most indebted consumer on the planet borrowing even more money.

With this extra cash we can buy lots of imported foreign energy and the cheap Chinese products, there is nothing to fear the UK economy will be booming in no time,

When we combine these with our thriving industrial strength and lack of dependency on a banking based economy, i think we will be ok.

Oh, hold on a minute...........

It's easy to be cynical - so the correct answer is? BTW, the strength or lack of in the Pound is not an issue.

Hmmm, it is for some of us old boy.

...is not an important (priority) issue in the context of the posters alternate solution to the financial crisis.

Apologies, but isn't this thread about the collapse of Sterling and it's impact on ex-pats?

Er, no, it's about the strength of the Pound and whether it's going into free fall!

By all accounts today was not a good one for the Pound. I think it already has.

[lannarebirth]

Dont worry about the "Pound" Flash Gordon and the BOE have got it under control, they slashed interest rates last week to give the consumer money in his/her pocket by way of mortgage relief, and to lower interest rates by 1.5% to get the most indebted consumer on the planet borrowing even more money.

With this extra cash we can buy lots of imported foreign energy and the cheap Chinese products, there is nothing to fear the UK economy will be booming in no time,

When we combine these with our thriving industrial strength and lack of dependency on a banking based economy, i think we will be ok.

Oh, hold on a minute...........

It's easy to be cynical - so the correct answer is? BTW, the strength or lack of in the Pound is not an issue.

Hmmm, it is for some of us old boy.

...is not an important (priority) issue in the context of the posters alternate solution to the financial crisis.

Apologies, but isn't this thread about the collapse of Sterling and it's impact on ex-pats?

Er, no, it's about the strength of the Pound and whether it's going into free fall!

By all accounts today was not a good one for the Pound. I think it already has.

Technically speaking, on the shorter interval charts, it's called a waterfall pattern. On the monthly chart I'd say freefall applies:

Note the percent drop is about the same as 1992-1993 first wave fall FWIW

[Marvo]

I came back to do some work in Blighty this month and brought my Thai girlfriend with me. The topic of conversation over that last two years inevitably drifted to how expensive things were in the UK. Now she's here she's saying how freakin' cheap everything is. Gala melons on the market, 17 baht a pop, muffins 9 baht each (pack of 6).

"How much is this" I hear,

"A quid" I say,

"What's that in Baht?" she asks...

"About 50" I say

[MJP]

I came back to do some work in Blighty this month and brought my Thai girlfriend with me. The topic of conversation over that last two years inevitably drifted to how expensive things were in the UK. Now she's here she's saying how freakin' cheap everything is. Gala melons on the market, 17 baht a pop, muffins 9 baht each (pack of 6).

"How much is this" I hear,

"A quid" I say,

"What's that in Baht?" she asks...

"About 50" I say

Makes me wonder about the current deflation argument in the UK at the moment. There must be a lag time between the pound going down and imported inflation. Makes stuff cheap for a while . . . but then .

I think they're getting this very wrong on interest rates or at least lending criteria. Likely we'll see deflation, IR cuts, big inflation (not hyperinflation, that's different).

[Naam]

USD appreciating too fast. With their mentalfundas and the appreciation being purely technical (repatriation) surely USD is now a tightly wound spring.

i agree MJP. but to make a little extra pocket money we have to howl with the wolves even though we migh have different opinions. by the way, this time i missed the boat because i was convinced the wild swings of the USD are over

[chiang mai]

Just noticed, GBP/USD at 1.49 looks oversold and reckon a retreat is on the cards. That should help push GBP/THB back from the edge of 50 which is looming rapidly, currently at 52.x. Shameful.

Bugger, 1.49, called that one wrong, again! Time to hand out the life vests, sub 50 Baht Pound is looming.

[Mosha]

On MSNUk one "expert" is saying the BOE should cut rates by 1% next month and .5% in January

[kerr17]

On MSNUk one "expert" is saying the BOE should cut rates by 1% next month and .5% in January

1.48 with $ and 50 with THB, situation is getting really worried, when we will touch the bottom?

[whiterussian]

Whoops! here cometh the back test!!!! only 397.9 points to go before round two meltdown.. just in time for xmas bonuses!

Edited November 13, 2008 by UKWEBPRO

[chiang mai]

On MSNUk one "expert" is saying the BOE should cut rates by 1% next month and .5% in January

1.48 with $ and 50 with THB, situation is getting really worried, when we will touch the bottom?

I think GBP/USD has by now built in the next rate cut by the BOE so the bottom shouldn't be too far away. I'm becoming increasingly nervous that USD is going to "bounce" soon and whilst I previously thought that wouldn't happen for some months yet I am now unsure.

[MJP]

What is really worrying is Mervyn King's latest little gem, reckons he'll cut to ZERO to try and avoid depression in the UK.

This is Japan folks, but without the big productive manufacturing economy.

Yikes!!!

[chiang mai]

What is really worrying is Mervyn King's latest little gem, reckons he'll cut to ZERO to try and avoid depression in the UK.

This is Japan folks, but without the big productive manufacturing economy.

Yikes!!!

That is the part of the picture that suggests Merv is under pressure and is viewed by many as not acting quickly enough by cutting rates sooner - he's really saying that he will do whatever it takes. But Merv doesn't have enough weapons at his disposal and interest rate cuts alone will not solve this problem. Doubtless Merv would not wish to see rates go to zero because if that happens his function becomes surplus to requirements! Interestingly also that Merv said that he was surprised by the fall of Sterling and wouldn't wish to see any further sharp falls. If you're the Governor of the BOE I wonder how surprised you can possibly be at the fall of the national currency!

[JimsKnight]

The BOEs hands-off approach basically means whenever I even hear that idiot on the news I usually just ignore 50% of the bs and just watch to see the trainwreckage of the £ get worse.

As everytime he does make an announcement the £ takes another bash.

Edited November 13, 2008 by JimsKnight

[spiderman2]

People on this post are saying the strength of the BHT to the GBP is linked to the dollar.

If this is the case why then when i first came to LOS in 2000 was i getting 80BHT to the GBP, whilst at the same time getting $1.50.

Arent i right in thinking the GBP value to the BHT is linked to weighted currecncies including the Yen which we're significantly down against.

[phaethon]

Dear Mervyn,

Yours sincerely,

K.

Edited November 13, 2008 by phaethon

[rgs2001uk]

People on this post are saying the strength of the BHT to the GBP is linked to the dollar.

If this is the case why then when i first came to LOS in 2000 was i getting 80BHT to the GBP, whilst at the same time getting $1.50.

Arent i right in thinking the GBP value to the BHT is linked to weighted currecncies including the Yen which we're significantly down against.

what was the us dollar/baht rate at that time?

a simple arithmetic calculation will give the answer.

yes now we are back at $1.50 to the £ but we aint getting 80 baht no more because the dollar/baht rate is now down to 34 or 35.

[chiang mai]

People on this post are saying the strength of the BHT to the GBP is linked to the dollar.

If this is the case why then when i first came to LOS in 2000 was i getting 80BHT to the GBP, whilst at the same time getting $1.50.

Arent i right in thinking the GBP value to the BHT is linked to weighted currecncies including the Yen which we're significantly down against.

That is indeed the case but the formlua only works within the context of its components when the snapshot in time is taken, clear!

OK, just because today the UK Pound is worth 1.47 US Dollars and one Pound is also worth 52 Baht, doesn't mean to say that relationship has always held true and that it will continue to hold true in the future - those relationships are not fixed and are subject to adjustment over time. In the case of your example in 1980, at that time Asian currencies, in particular the Thai Baht, were undergoing an adjustment following the Asian crisis three years earlier. During that crisis the Thai Baht went from 35 to the Pound to 88 Baht to the Pound and in the following years it recovered to the level we see today. Just because the Baht adjusted during that time frame doesn't mean that all other currencies have to adjust also.