Toilet-Currency

Everytime I see that disgusting phrase, I want to punch someone (preferably Harwoman) Too bad. Pensioners abroad knew the rules when they moved or when they retired. Every extra pound we send overseas is another pound against our balance of payments.

More QE without fiscal retrenchment = gilt carnage

That's quite a positive spin, even by the bbc's standards. Does Moody's really use the words "well positioned"? FT quotes differently: http://www.ft.com/cms/s/0/fc9e09ee-301a-11df-8734-00144feabdc0.html

Yup. The polls are way too close for the market to have any idea where this is going beyond May ; it's too binary. Even if short positions are at a record, the possibility of more QE without tackling the deficit will be too toxic for the markets to bear. I also expect another phase of dollar gains soon if we approach the US elections with the expectation of a less partisan House and Senate. To me, futures are way too risky right now- legging into options positions is much better.

Brown is gone, win or lose. If he wins, Mandy will parachute himself into a safe seat and then knife Gord in the back.

Britain's other trump card is a (relatively) non-unionised workforce which is both more supine and less regulated than it was in past crises. This doesnt show up in any of the commonly quoted statistics about debt, deficits etc but could turn out to be more important.

The article refers to 2.8 milion union members out of a workforce of 5 million. Seems an awful lot (presumably there are other TUs as well) When we reach the same stage in the UK (immediately before austerity kicks in), I don't think the reaction will be as organised or unified.

No. Remember how Madoff used to generate top returns quarter after quarter after quarter? Maybe things are being exported to Macau, from Macau to Hong Kong and then imported back into China?

What you should've done is buy pounds, then start a "Black xxxday" thread on HPC Bound to go up then.

Putting the party politics to one side, time and time again, this type of thread on HPC come down to 2 views: 1) we have to do everything in our power to fight the recession. Zero rates, QE, stimulus. None of these should be scaled back until we are back in growth. OR 2) fighting the recession until growth returns is futile. Meaningful growth's not coming back anytime soon, since the necessary cuts will preclude it. We dont really have a "choice" between recession or no recession; simply, it's a choice between cuts & recession now or a worse recession later. Brown, Balls and co fit (1). Both Darling , and to a greater extent, Osborne, fit (2). However, your quesion isn't really valid, since Darling will most probably be reshuffled in the event of a Labour victory.

What they need are some immigrants to dilute the uppity natives and help ram the programme through the next referendum.

If you're a boomer with lots of capital, no desire to work and willing to get out quickly when the STHF (or when they make a grab for your offshore wealth or your land), some parts of Argentina would be great. It's not all polo and gaucho, of course. If not, it is a massively flawed place. Fascinating, incredibly beautiful, but totally entrenched in arbitrary and short-term politicking, which has been its achilles heel for a century

Agree. Shows how out of touch that they are even considering this. As an either/or, £ for £, it would be much less controversial to increase vat to20% than start levying it on staple foods (or for that matter, move things like electricity onto the higher rate) EDIT... and we will no doubt see a knock-on effect on food prices from sterling's current slide.

It would be great news for your small market trader (who's quite possibly not vat registered) and great news for the black market. Maybe this would change the way we shop (if the vat rate on food were to be high enough) ...

Good idea, given the alternatives. No, you wouldn't , alas. It isn't like a student loan or an annual pay deal from your employer (where they take the RPI at a given point and give you that as your pay risefor the next year). 3.7% is a historical measure, not forward looking. You get the benefit of future inflation, whatever that may be.

What nonsense. In late 2008, the curb on shortselling arguably caused the equity market to be so much more volatile than it might otherwise have been, by killing off incremental buyers (short coverers) and crushing trading volumes at a time when there were many forced sellers. This blame game will only result in an even more illiquid market for greek debt. A self-inflicted wound when the ECB/greek banks, potentially need to unload €billions of junk debt into an illiquid market

The last time a painted town solved anything was in Clint Eastwood's "High Plains Drifter".

Unlikely. It would be impossible for any party to construct a financial regulatory system in which the principal regulator did less to regulate banking than the FSA did over the last 10 years. Absolutely impossible. The FSA did jack. Not to mention the structural budget deficit run for years and years, which has everything to do with the personalities in the current government...

Former govt employee says: ** But I'll be hanging on to the Golf / Audi in my garage, thanks very much That guy had best keep what he's already got. I expect he made off with a nice pension. The rest of his compatriots aren't going to afford those nice quality German things once they've taken a 40% paycut or Greece and the evil Hun no longer have the same currency. Of course, the same is in the offing for the UK.... but we always knew that was part and parcel with keeping the pound and electing the same bunch of monkeys 3 times

A serious point though: as government debt loses its lustre, how long before the big creditors start to demand some kind of security against all government borrowing? At present, it all ranks equally. Imagine what happens when Darling has to offer vast tracts of government-owned land just to be able to borrow more. As for the Germans, well, guess who's towel is gonna be first on the beach....

On this point I must protest. If the UK lost its free trade "privileges", which company would be worse off? - BMW, VW, Mercedes etc, or - Toni and Guy

what good would it do the EU? it certainly wouldn't prevent contagion in their banks. But it would end the commission's legal say in UK affairs, which probably fills them with horror. It is, however, somewhat anomalous that if any eurozone country (e.g. Greece) were to leave the euro, they would have to leave the EU (under current treaties). But I'm sure they could fix that pretty quickly if they had to.

Right conclusion, completely wrong reasoning in my opinion. Stocks are going to fall because they are overvalued. Personally, I think there is little likelihood that the S&P 500 will pay 1100 points worth of dividends (to perpetuity)- rather , it's just a Ponzi valuation. We are already seeing/are about to see higher taxes, political meddling, misallocation of government revenues, rising interest rates, depression/stagnation, rollback of free trade etc etc etc. All this talk about the chips being stacked against the little man makes for good rabble rousing, but consider: every wall street trader knows that a bull market is best for bonuses. They have a vested interest in the market rising.

Time and time again, lazy journalists fall into the trap of comparing yields across different currencies and drawing a straight conclusion about creditworthiness. I'm not saying that the UK's fiscal health is particularly strong- far from it- but the article does not begin to consider whether the expected path of interest rates over the next 10 years might differ between the €-zone and sterling. Nor does it talk about the impact of the cessation/pause of QE. Pretty basic stuff.

Quite right. But if you are a local authority with £XX million in Icesave and can no longer pay the bills, you are going to go cap in hand to the Treasury anyway. Some of the councils had pretty chunky exposures (Neath?) despite not very many council tax payers. Political considerations in the heartlands may well have decided this. Edit for rewording