UK pound plunges as referendum results point to EU exit

[ilostmypassword]

^Yes you did provide the graph with your post. doesn't matter that you didn't author it.

I'm quite capable of analysing the graph. I was laughing at your inability to do so.

I know you didn't vote. I can tell from your spelling that you're not British. Plenty of non-Brits are members of the 'stay' brigade.

Whereas only 48% of the British electorate is.

[55Jay]

[Mark123456]

Weak Pound is good. Good for foreign direct investment. Good for getting a proper trade balance back. Good for re-balancing the economy back to real production. Good for diminishing our enormous debts.

To avoid confusion pleas read

https://en.wikipedia.org/wiki/United_Kingdom_national_debt

Debt versus deficit

<......>

The UK national debt is often confused (even by politicians) with the government budget deficit (officially known as the Public Sector Net Cash Requirement (PSNCR) ......

<..........>

........ As of 2011 around 35% of the national debt was owed to overseas governments and investors. ........

read in: http://www.live-counter.com/uk-national-debt-clock/

By 2011, the British national debt amounted to £940 billion, with most of the money, 35 percent in total, being owed to other governments and investors. On this debt interest alone cost more than £42.9 billion annually. By 2012 the national debt amounted to £1,278.2 billion. Currently, Great Britain's debt clock keeps ticking and adding more and more numbers to an already high amount. Every second Great Britain increases its debt by £5190 and every day by £448.500,000 as can be seen on the debt clock. Over the course of a year that implies a new £163 billion that the government owes to other people, governments and institutions, marking a solid £1,471 billion on the national debt clock above. Interestingly, the Bank of England still contributes its fair share to the debt – a rocking £42.4 billion, which is more than the national defense budget. Network Rail also contributes £33 billion to the total amount, which is the same amount the entire country of Uruguay can show for its GDP. Great Britain struggles to remain as great as it once was with so high a debt burden on its shoulders.

Now to your "Good for diminishing our enormous debts."

One example for paying US$ debts:

1 billion Dollar =

• Yesterday the exchange rate was 1 GBP = 1,485814 US $ 731.977.613 GBP
• Today the exchange rate is 1 GBP = 1,366862 US$ 677.592,113 GBP

difference: 54.385.450 GBP

What does it mean?

To pay back only 1 billion (1.000.000.000) US$ wouldn't diminish the debts for England, but increase it by more than 54 million US$. I guess Johnson didn't tell you.

Did anyone tell you that as of 2015 only around 25% of UK government debt was held by overseas investors? Have you also considered that most of it will be in the form of UK government bonds (gilts) which are denominated in which currency do you think? Not sure what you mean by the BOE contributing to the debt, they actually own around a quarter of UK government debt so it goes both ways.

[Mark123456]

I wanted to remain, but I can't see what the big deal is.

I don't understand why it spells economic disaster. Why is it any number of smaller economies do ok as sovereign nations, but a big economy like the UK can't? Why will the EU make trading difficult for UK, which is important to them? Likewise Britain won't be imposing tariffs on EU goods will they?

I guess we have to accept the Scots will want out the Union, that is likely to be the major disruptor, not the EU.

57% of British exports go to the EU and 55% of imports come from it. Now that's all in jeopardy to an extent that's really hard to estimate. The Germans are likely to be punitive toward the UK just as they have been toward the Greeks who also threatened the union out of which the Germans have been the big winners.

So that's all in question. And for what exactly? To make sure there are no more Polish plumbers?

Neither the UK or Germany will want to engage in a disasterous trade war. Both are heavily dependent on one another. I don't see the big deal at all.

I guess there will be big swings and roundabouts, but it will even itself out.

It's very bad for me I must admit, as it will be for all expats, but not for the UK I suspect.

British exports to Germany have been rising while German exports to all of the EU have been falling. Since German exports overall have been increasing that means that more it goes to Asia and other regions than the EU. So, it would appear that the UK needs Germany more than vice versa.

But you could be right. Let's hope so since you have bet the British economy on it.

http://www.telegraph.co.uk/finance/newsbysector/industry/9816643/Britain-becomes-Germanys-biggest-trade-partner-as-Berlin-London-pact-deepens.html

Value of British exports to Germany: around $46 billion. Value of German exports to the UK: around $100 billion. Your schadenfreude is touching but you are ill informed (or uninformed). If you want to talk percentages then sure, at 10% of total exports, the UK's exports to Germany may be more valuable than the German exports to the UK are to them (at around 7%). But you should also consider that 10% of the Netherlands exports (by value) go to the UK and around 7% of France's. Also, in common with Germany, UK exports to the rest of the world have been increasing while its exports to EU countries as a whole have been declining. I don't think the UK or the remaining EU countries will be keen to lose their cross border trade though.

I wasn't in favour of the UK leaving the EU and the pound is falling again this morning in Asian trading (GBP/USD currently 1.3421) but posting nonsense helps no-one.

Edited June 26, 2016 by Mark123456

[MJP]

Pound Sterling live . . .

https://www.poundsterlinglive.com/

https://www.poundsterlinglive.com/gbp-live-today/5088-pound-to-euro-reactions-to-brexit-and-pm-resignation

Edited June 26, 2016 by MJP

[NeverSure]

[bkkcanuck8]

EU plans moving bank regulator from London as euro zone eyes City business

http://www.reuters.com/article/britain-eu-finance-idUSL8N19I0AY

Not unexpected - and not the last financial relocation....

[SheungWan]

Sterling down further in Asian markets Monday morning. The expat guys here seemingly happy with sterling's drop (assuming that they aren't the usual resentful crowd who have already been forced back home) apparently a couple of planks short of a full floorboard. Are they all from Sunderland? (who we can only hope are relegated next season)

[bkkcanuck8]

And many people on here are trying to play up the devaluation of the GBP as a plus.... but the fact is that history has often pointed out that you cannot devalue your way to prosperity.... in fact often it is a race to the bottom caused by economic problems. Sometimes these economic problems leave countries no option to devalue their currencies...

Why does devaluation not work well? Often because things that "could be helped" by devaluation such as manufacturing are dependent on external trade itself which means most of the inputs prices get inflated due to a weak currency, the cost of living goes up as imports of basics rise ... oil & food .... which then trickles through the economy and workers get upset because their wages are not keeping up and labour unrest disrupts the economy and inflation rises.... eventually forcing interest rates to rise to stop the fall in the currency and keep inflation in check. If left too long the medicine becomes incredibly expensive and hurts etc. etc. etc. What is needed is really currency stability.

[Mark123456]

And many people on here are trying to play up the devaluation of the GBP as a plus.... but the fact is that history has often pointed out that you cannot devalue your way to prosperity.... in fact often it is a race to the bottom caused by economic problems. Sometimes these economic problems leave countries no option to devalue their currencies...

Why does devaluation not work well? Often because things that "could be helped" by devaluation such as manufacturing are dependent on external trade itself which means most of the inputs prices get inflated due to a weak currency, the cost of living goes up as imports of basics rise ... oil & food .... which then trickles through the economy and workers get upset because their wages are not keeping up and labour unrest disrupts the economy and inflation rises.... eventually forcing interest rates to rise to stop the fall in the currency and keep inflation in check. If left too long the medicine becomes incredibly expensive and hurts etc. etc. etc. What is needed is really currency stability.

History shows you cannot devalue your way to prosperity because countries that try this do so by printing/issuing more money, so causing high inflation. However, the point you seem to be missing is that the UK is not trying to devalue its way to prosperity so there won't be an accompanying rise in the money supply as far as this particular devaluation is concerned. A lot of amateur economists on this board.

[hagler]

Ignore these indicators, all a symptom of speculation and market uncertainties. Just have a cup of tea, it will all be OK.

In a couple of days when they realise the sky isn't falling

well it is 3 days and the sky isnt falling but the pound still is

wanna have another guess? ;-)

[Mark123456]

Sterling down further in Asian markets Monday morning. The expat guys here seemingly happy with sterling's drop (assuming that they aren't the usual resentful crowd who have already been forced back home) apparently a couple of planks short of a full floorboard. Are they all from Sunderland? (who we can only hope are relegated next season)

Sterling's fall is what it is. There's no point in being emotional about it. Not all of us British expats receive all of our income in GBP and not all of us are stuck on a fixed pension. Some of us can actually take measures to cope with the devaluation and those who can't may be well able to cope with a fall in income without being 'forced back home' as you put it. I'm not happy with it but I'm not devastated either. I see some posters moaning about British expats for 'whining' about the result and others moaning about British expats who aren't whining about the result. Seems like some people just want to take the opportunity to have a pop at the British whenever they can - a regrettable attitude really. I'm not living on the breadline so a 10-12% drop in my income wouldn't cause me any financial distress anyway, even if you wish it would - sorry to disappoint.

[SheungWan]

Sterling down further in Asian markets Monday morning. The expat guys here seemingly happy with sterling's drop (assuming that they aren't the usual resentful crowd who have already been forced back home) apparently a couple of planks short of a full floorboard. Are they all from Sunderland? (who we can only hope are relegated next season)

Sterling's fall is what it is. There's no point in being emotional about it. Not all of us British expats receive all of our income in GBP and not all of us are stuck on a fixed pension. Some of us can actually take measures to cope with the devaluation and those who can't may be well able to cope with a fall in income without being 'forced back home' as you put it. I'm not happy with it but I'm not devastated either. I see some posters moaning about British expats for 'whining' about the result and others moaning about British expats who aren't whining about the result. Seems like some people just want to take the opportunity to have a pop at the British whenever they can - a regrettable attitude really. I'm not living on the breadline so a 10-12% drop in my income wouldn't cause me any financial distress anyway, even if you wish it would - sorry to disappoint.

Of course not all do, but most do (have incomes based in sterling that is) and as for the 10-12% drop in sterling, well Hello Boys! Now throw in the rout in the FTSE and those who are approaching retirement with investment pensions are going to get royally stuffed. I at least don't confuse my own position with others' or the general situation. And how many times do I have to point out to Brexit guys who seem to have a poor grasp of maths that it doesn't matter whether your pension is indexed (against inflation?) it isn't indexed against currency moves. So there we have it, a brilliant contribution above calling sterling's awful (Brexit caused) drop 'is what it is'. The dead cat blandness of response is staggering.

[Thaiwine]

Are you all transfering your GBP into Baht on a daily basis? no read on

So you haven't lost anything until you do, why not start crying after you have.

[MissAndry]

Sterling down further in Asian markets Monday morning. The expat guys here seemingly happy with sterling's drop (assuming that they aren't the usual resentful crowd who have already been forced back home) apparently a couple of planks short of a full floorboard. Are they all from Sunderland? (who we can only hope are relegated next season)

Sterling's fall is what it is. There's no point in being emotional about it. Not all of us British expats receive all of our income in GBP and not all of us are stuck on a fixed pension. Some of us can actually take measures to cope with the devaluation and those who can't may be well able to cope with a fall in income without being 'forced back home' as you put it. I'm not happy with it but I'm not devastated either. I see some posters moaning about British expats for 'whining' about the result and others moaning about British expats who aren't whining about the result. Seems like some people just want to take the opportunity to have a pop at the British whenever they can - a regrettable attitude really. I'm not living on the breadline so a 10-12% drop in my income wouldn't cause me any financial distress anyway, even if you wish it would - sorry to disappoint.

Of course not all do, but most do (have incomes based in sterling that is) and as for the 10-12% drop in sterling, well Hello Boys! Now throw in the rout in the FTSE and those who are approaching retirement with investment pensions are going to get royally stuffed. I at least don't confuse my own position with others' or the general situation. And how many times do I have to point out to Brexit guys who seem to have a poor grasp of maths that it doesn't matter whether your pension is indexed (against inflation?) it isn't indexed against currency moves. So there we have it, a brilliant contribution above calling sterling's awful (Brexit caused) drop 'is what it is'. The dead cat blandness of response is staggering.

All the British pensioners can simply move back, and not have to worry about the exchange rate.

Get your NHS entitlement back and your state pension increases at the same time.

Your wife can work, instead of leeching off you, and your children can attend a proper school.

No need to worry about all those 'lazy Thai men' either.

Looks like win win to me.

Edited June 27, 2016 by MissAndry

[Gweiloman]

Sterling down further in Asian markets Monday morning. The expat guys here seemingly happy with sterling's drop (assuming that they aren't the usual resentful crowd who have already been forced back home) apparently a couple of planks short of a full floorboard. Are they all from Sunderland? (who we can only hope are relegated next season)

Sterling's fall is what it is. There's no point in being emotional about it. Not all of us British expats receive all of our income in GBP and not all of us are stuck on a fixed pension. Some of us can actually take measures to cope with the devaluation and those who can't may be well able to cope with a fall in income without being 'forced back home' as you put it. I'm not happy with it but I'm not devastated either. I see some posters moaning about British expats for 'whining' about the result and others moaning about British expats who aren't whining about the result. Seems like some people just want to take the opportunity to have a pop at the British whenever they can - a regrettable attitude really. I'm not living on the breadline so a 10-12% drop in my income wouldn't cause me any financial distress anyway, even if you wish it would - sorry to disappoint.

Of course not all do, but most do (have incomes based in sterling that is) and as for the 10-12% drop in sterling, well Hello Boys! Now throw in the rout in the FTSE and those who are approaching retirement with investment pensions are going to get royally stuffed. I at least don't confuse my own position with others' or the general situation. And how many times do I have to point out to Brexit guys who seem to have a poor grasp of maths that it doesn't matter whether your pension is indexed (against inflation?) it isn't indexed against currency moves. So there we have it, a brilliant contribution above calling sterling's awful (Brexit caused) drop 'is what it is'. The dead cat blandness of response is staggering.

All the British pensioners can simply move back, and not have to worry about the exchange rate.

Get your NHS entitlement back and your state pension increases at the same time.

Your wife can work, instead of leeching off you, and your children can attend a proper school.

No need to worry about all those 'lazy Thai men' either.

Looks like win win to me.

Thailand's requirement for a foreigner to retire here is only Thb 65,000 per month. For a retiree from the UK planning to live here, 6,000 miles from Blighty, if their finances cannot survive a 10-15% fluctuation of income, one has to question if they made the right choice in the first instance.

[theguyfromanotherforum]

Remember how certain pensioners were whining about budget backpackers telling them to go home?

Well, the time has come for undesirable British pensioners (or should we call them low quality retirees) to pack up and head home.

[Briggsy]

Don't worry about the exchange rate. The markets always over-react to (what they consider) bad news. The low point is on average 10 days after the news. After that the recovery starts. By January 2017 and probably a lot earlier, the median rate'll be clearly above 50.

[theguyfromanotherforum]

Don't worry about the exchange rate. The markets always over-react to (what they consider) bad news. The low point is on average 10 days after the news. After that the recovery starts. By January 2017 and probably a lot earlier, the median rate'll be clearly above 50.

Or not.

[mcfish]

Don't worry about the exchange rate. The markets always over-react to (what they consider) bad news. The low point is on average 10 days after the news. After that the recovery starts. By January 2017 and probably a lot earlier, the median rate'll be clearly above 50.

hmmm history has shown thats not always the case. Maybe short term it might..but then it can easily rinse n repeat

[Naam]

Thailand's requirement for a foreigner to retire here is only Thb 65,000 per month. For a retiree from the UK planning to live here, 6,000 miles from Blighty, if their finances cannot survive a 10-15% fluctuation of income, one has to question if they made the right choice in the first instance.

a rather unfair comment because a British retiree drawing a pension or social security of £1,000.- might have chosen to live in Thailand when £1k bought THB 75,000 (~10 years ago) but faces now a loss of 37%

besides, the requirement THB 65k/month is not mandatory because the option THB 800k bank balance in lieu of minimum income is available.

[MJP]

Thailand's requirement for a foreigner to retire here is only Thb 65,000 per month. For a retiree from the UK planning to live here, 6,000 miles from Blighty, if their finances cannot survive a 10-15% fluctuation of income, one has to question if they made the right choice in the first instance.

a rather unfair comment because a British retiree drawing a pension or social security of £1,000.- might have chosen to live in Thailand when £1k bought THB 75,000 (~10 years ago) but faces now a loss of 37%

besides, the requirement THB 65k/month is not mandatory because the option THB 800k bank balance in lieu of minimum income is available.

Surely those retirees looked at long term forex rates before deciding to move? £1/THB75 was one of the historic highs.

[otherstuff1957]

No-one has discussed the effect of Brexit on the Euro! The Euro is down even more than the Pound. They both lost value after the vote, but the Pound is down about 8% and the Euro is down about 10%!

Edited June 27, 2016 by otherstuff1957

[Bunnychow]

No-one has discussed the effect of Brexit on the Euro! The Euro is down even more than the Pound. They both lost value after the vote, but the Pound is down about 8% and the Euro is down about 10%!

And if France and Holland go down the referendum road, the Euro will really end up in the toilet and the favoured Euro currency will be the GBP LOL, as most countries havent printed their own currency in many years Edited June 27, 2016 by Bunnychow

[ilostmypassword]

No-one has discussed the effect of Brexit on the Euro! The Euro is down even more than the Pound. They both lost value after the vote, but the Pound is down about 8% and the Euro is down about 10%!

There's a story when WW1 was in progress Yeats said it was a pity that both sides couldn't lose. Well, as it turned out, both sides did. It happens.

[luk AJ]

Ignore these indicators, all a symptom of speculation and market uncertainties. Just have a cup of tea, it will all be OK.

In a couple of days when they realise the sky isn't falling

well it is 3 days and the sky isnt falling but the pound still is

wanna have another guess? ;-)

Barclay, RBS, Easy jet all sunk 30% today. At which point you concider the sky is falling?

[ilostmypassword]

And many people on here are trying to play up the devaluation of the GBP as a plus.... but the fact is that history has often pointed out that you cannot devalue your way to prosperity.... in fact often it is a race to the bottom caused by economic problems. Sometimes these economic problems leave countries no option to devalue their currencies...

Why does devaluation not work well? Often because things that "could be helped" by devaluation such as manufacturing are dependent on external trade itself which means most of the inputs prices get inflated due to a weak currency, the cost of living goes up as imports of basics rise ... oil & food .... which then trickles through the economy and workers get upset because their wages are not keeping up and labour unrest disrupts the economy and inflation rises.... eventually forcing interest rates to rise to stop the fall in the currency and keep inflation in check. If left too long the medicine becomes incredibly expensive and hurts etc. etc. etc. What is needed is really currency stability.

History shows you cannot devalue your way to prosperity because countries that try this do so by printing/issuing more money, so causing high inflation. However, the point you seem to be missing is that the UK is not trying to devalue its way to prosperity so there won't be an accompanying rise in the money supply as far as this particular devaluation is concerned. A lot of amateur economists on this board.

Actually, high inflation is one way countries do get out of depression. For example,thanks to WW2 there was a lot of inflation in the USA and people who were being held back because they were deeply in debt easily paid their way out of it. Not good in the short run for banks and such, but the ensuing economic prosperity was. And issuing money in itself does not cause high inflation.

[tomacht8]

I think existentially here no need to worry so much.
Anyone who lives in Thailand for years or decades, should have learned that flexibility.
Whether Pounds or Euros, which are against the Thai Baht falling since years.

More problematic are here the thai price developments in the future.
All who live now on a knife edge, should consider how they can optimize their cost structure.

Whether Brexit or Not, I am quite sure that in the next 10 years, the exchange rate will continue to deteriorate and the Thai inflation (price increases) will continue.

When this week is over, I'm sure we will continue to find a soft slipping of pounds and euros against the thai Baht.

Cash today, Bangkok Bank, Bank Note Buying Rates
http://www.bangkokbank.com/BangkokBank/WebServices/Rates/Pages/FX_Rates.aspx

27.06.2016: Time: 2:11:30 Pound: 46,41
27.06.2016: Time: 2:11:30 Euro: 38,30

04.07.2016 ???

Edit for clear understanding.

Edited June 27, 2016 by tomacht8

[CaptHaddock]

And many people on here are trying to play up the devaluation of the GBP as a plus.... but the fact is that history has often pointed out that you cannot devalue your way to prosperity.... in fact often it is a race to the bottom caused by economic problems. Sometimes these economic problems leave countries no option to devalue their currencies...

Why does devaluation not work well? Often because things that "could be helped" by devaluation such as manufacturing are dependent on external trade itself which means most of the inputs prices get inflated due to a weak currency, the cost of living goes up as imports of basics rise ... oil & food .... which then trickles through the economy and workers get upset because their wages are not keeping up and labour unrest disrupts the economy and inflation rises.... eventually forcing interest rates to rise to stop the fall in the currency and keep inflation in check. If left too long the medicine becomes incredibly expensive and hurts etc. etc. etc. What is needed is really currency stability.

History shows you cannot devalue your way to prosperity because countries that try this do so by printing/issuing more money, so causing high inflation. However, the point you seem to be missing is that the UK is not trying to devalue its way to prosperity so there won't be an accompanying rise in the money supply as far as this particular devaluation is concerned. A lot of amateur economists on this board.

Actually, high inflation is one way countries do get out of depression. For example,thanks to WW2 there was a lot of inflation in the USA and people who were being held back because they were deeply in debt easily paid their way out of it. Not good in the short run for banks and such, but the ensuing economic prosperity was. And issuing money in itself does not cause high inflation.

Nonsense. A country in depression would be experiencing debt deflation, not inflation.

[SheungWan]

Ignore these indicators, all a symptom of speculation and market uncertainties. Just have a cup of tea, it will all be OK.

In a couple of days when they realise the sky isn't falling

well it is 3 days and the sky isnt falling but the pound still is

wanna have another guess? ;-)

Barclay, RBS, Easy jet all sunk 30% today. At which point you concider the sky is falling?

No, not 30% just on today but the financials getting hammered again. FTSE resistance at 6000 looks to be having a little trouble. Cable right near the 1.32 mark.