Friday, November 21, 2008

Just wait for Euro Parity. They’re coming.

European Central Bank: Britain Welcome To Join Euro

"As the pound struggles against other major currencies, the president of the European Central Bank has told Sky News that Britain is "welcome at any time" to join the euro." You think its bad now, imagine an ECB affecting our liquidity because of decisions made in Germany.

Posted by planning4acrash @ 01:48 AM (1489 views)
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20 thoughts on “Just wait for Euro Parity. They’re coming.

  • I wish Germany was in charge of the economy – we would have a large manufacturing base and a current/trade surplus plus a real health system.

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  • In fact, don’t tell anyone, but joining the Euro would wrest an awful lot of control from our rather corrupted central bankers in threadneedle street, and very likely put an end to rip-off Britain.

    Which actually, is not a bad thing at all.

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  • I wonder if we’d have been in this silly mess in the first place had we have been in the Euro. It’s difficult to see how it could have been worse. Britain is obsessed with thinking it knows best – regardless of the empirical evidence. P4AC expresses the UK blame culture well – the assumption that things can only get worse if you work with others. This mistaken pride and arrogance that “you can mind your own business thank you very much” is the heart of it.

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  • p4ac is more liely to say that you’ve fallen for the ‘engineered’ situation we are in.

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  • these first three comments show me that perhaps xenophobic positions in this country are changing (not that you 3 are xenphobes). In any case nope i dont agree with us EVER joining the Euro because there is no way monetary, fiscal and social policy can cope with Economies which are very different. Thats why some of the Eurozone economies are in real bother. In essence politicians can never make decisions quickly enough when they need to (thats not their fault really) add to that politicians that are thinking more global on diverse cultures and for different economies in different stages of their cycle and based on different sectors and you are bound to get massive regional winners and losers (which creates the xenophobicness – sorry re my english but am in a bit of a rush). Now if we all get to a common bottom – then there would be a case for joining. But i dont think there will be enough commonality at the bottom.

    Its actually more likely the Eurozone implodes.

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  • mark wadsworth says:

    I’d like to agree with MTH, Paul and Growler but we tried being in the ERM and it all went horribly wrong. We can sort out Threadneedle street by sacking the whole BoE MPC without replacement (why do we need a BoE base rate anyway? To give politicians a piece of string to push?)

    Currency unions always break up in the end – they have been tried dozens of times throughout history, and lots of smaller countries still peg their rate to EUR or USD – in fact it must be almost inevitable that currency unions break up, or else all currencies in the world would gradually have merged into a few large ones, in the same way that the English language is gradually driving out other languages and lots of minor languages and dialects are dying out.

    Just you wait until Ireland, Spain and/or Italy bomb out of the Euro. That’ll be fun.

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  • Errr… so the ECB is skewed in favour of economies that deliver a good balance of manufacturing, service economies and sustainable household lending with stable, non-inflated house prices (i.e. Germany, France) … and is complained about by those who have inflated house prices, over-reliance on construction industries, boom and bust etc.? One size does fit all – the best practice economies are the ones that fit best with the ECB and the poor practice are the ones who don’t – don’t blame the ECB for that!!

    Re: the ERM – we dropped out because of British arrogance at the time, the £ joined the ERM at an unrealistically high rate, it was to nobodies surprise (and George Soros’ profit) that it was unsustainable. Not that the ERM / euro membership was essentially bad, as the economic numpties and xenophobes claim!

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  • yes Guiriduro but its not supposed to be biased towards “good” economies over “bad” economies is it? My recollection is that all members are supposed to benefit by access to biggger markets blah blah blah. So if the ECB is skewed (your words) then the whole thing has already failed!

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  • japanese uncle says:

    The only problem is Euro may not be able to survive this Born-again Great Depression.

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  • JU is right – as i understand it you cant have protectionism within a trading block. Its not the Euro that fails its the members of the Eurozone become disenchanted, removing their reliance on the centralised monetary policy and embarking on protectionism (whatever they say about being opposed to it). IMO that woint happen for a while – but it will happen.

    As for us and the ERM I was trading short sterling at that time. I was naive then and believed the government would do everything to maintain membership of the snake. A friend of mine didnt believe and bough out of the money calls @ 5 basis points. Short steling only every reflected 10% rates (not 15%) and when we pulled out the markets went through the roof and i had some significant losses. My friend was able to sell his calls for 300-350. He had quite a few!

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  • planning4acrash says:

    You want to see how we’d been under the Euro? Look at Ireland, we’d have had lower interest rates. And, with less control over BOE than ECB, imagine how crazily the ECB can inflate once its established. The top level people who run the ECB, run the BOE.

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  • We really don’t want to go there, the EU is even more corrupt than the shambles we call the UK government, the EU yet again got their accounts thrown out, due to massive fraud!
    The UK MPs are fools and knaves because they force us to obey EU script which other EU countries rightly mock and ignore.
    The Euro is just a political device to increase the stranglehold of EU political control over countries, in the EU.
    I am already considering emigration, however if the UK government forces us into the Euro, I’ll probably sell up and exit sharpish, to escape the UK before the titanic EU dictatorship finishes off the UK.

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  • planning4acrash says:

    Guiriduro, the ECB isn’t skewed towards productive economies, its skewed towards the balance sheet of investment banks like Goldman Sach’s. Germany, currently, is starved of credit, whilst Spain has too much.

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  • “joining the Euro would wrest an awful lot of control from our rather corrupted central bankers in threadneedle street, and”

    …transfer it to rather corrupted central bankers in Strasbourg. Great.

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  • Thethirdliitlepig says:

    If we had been in the Euro houseprices would have risen even higher. CPI is the European measure of inflation. Had Labour not used it, our interest rates would have been higher and house price inflation would have been lower.

    The European is not a true Union. The countries are only in it for what hey can get – “Ask not what your country can do for the EU but what the EU can do for your country” – and that’s why it’ll fail.

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  • i think our NHS is rather good. See how you get on in America?

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  • I object!!!!!!!!!!

    Our NHS is terrible! Please don’t compare us to America. That’s like saying I have good water because the guys in the desert don’t.

    We vastly overpay our GPs.

    Our hospitals are being sold to private companies so that the government can meet short term budget deficits in NHS expenditure.

    We import a sizable portion of our health care workforce from third world countries (we are therefore subsidized by them).

    The level of service stinks in the clinics of this country (precisely because of the lack of competition).

    A doctor is alloted 10 minutes for each appointment. And if you have more than one issue, that requires another appointment.

    The doctor is obliged to prescribe a remedy from a list that is outlined by a politician rather than use his own experience and (very expensive) training.

    People have died due to MRSA because of a lack of HYGIENE! (In this country!!! How far has the Empire fallen?)

    Our NHS is broke. Frankly.

    We are asking our nurses to work for free.

    It costs rediculously large amounts to a) park in a hospital parking lot b) spend a night in a hospital bed c) make a phone call using the hospital phone service. (Nothing like charging the suckers when they have no choice eh?)

    The nhs is a classic example of how politicians in this country don’t understand:
    1. The Free Market
    2. Economics

    They have essentially nationalized GPs accross the country. Thereby destroying any advantages normally associated with the free market. (Good service, efficient health care.)

    They have privatized the hospitals. Thereby essentially awarding mini-monopolies to the private sector. (You don’t choose which hospital you go to when you have had an accident.)

    Its all back to front!

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  • planning4acrash says:

    Hey, the NHS is only “good” because it has a monopoly. Without inflation, we’d all be able to afford enough private healthcare, and charity to have much better support, like, maybe then, healthcare may even meet our needs?! We already see people going to eastern europe for better healthcare.

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  • planning4acrash says:

    “The only problem is Euro may not be able to survive this Born-again Great Depression.”

    – I hope it doesn’t, imagine if it fell, and revived local currencies led to a sustained boom!!!!!!!

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  • …. at the risk of some P4AC conspiracy theorising, it is in the interests of the USA that Europe bickers and that our currency union fails. Ask yourself: who makes money out of differing currencies? Banks. Now with other income streams weak, would you not be interested in currency speculation?
    Second: Why should separate currencies work any better? The reason we don’t like them here in the UK is because we NEED to fudge the system to pay for the system. Personally, I’d be happier with proper integrated control of the banks via the ECB than our banks fully nationalised and under control by a UK government and an arms length BofE. I have a lot of respect for King, but he’s given a particular target – by the Government. So with the banks (supply of money) and BofE (control of money) all ast the mercy of competent government people (sic) as present – I find it hard to not feel a tad concerned.
    I’m a free market person. We, frankly, need to pay up for the binge. Average personal debt in the Uk is huge compared to elsewhere – that money needs to be cleansed and the companies that sprang up because of it need to – sadly – close. They weren’t meant to be – let’s face it. Same as house prices. There are owners that never were meant to be owners. We’re seeing this now.
    All of this “correction” is due to poor bank management and control. All made in the UK. This is one “service” we ought not to export.

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