Monday 12 October 2009

Down with the Pound!

FT Alphaville note the poor run on Sterling initiated today by the news the Government is to sell of assets. It all looks rather sickly, however, when you look at the trade weighted index for 1992 - the last devaluation event, it looks horrible. But it is worth mentioning that over the last 12 months the Pound has done worse than this overall, in fact, it is now below 85 on a trade weighted basis, matching this devaluation. So the only question is whether we expect a bounce or not. I think there will be, but not much of one, certainly not to take us back up 10% to 20%. Alistair Darling IS Norman Lamont.

10 comments:

Old BE said...

Post 1992 we had a benign inflation-free recovery. I somehow doubt we will manage that again. I see that QE has been expanded *again*. That has got to stop before everyone's savings are destroyed.

Budgie said...

It would be good if Darling was Lamont. Lamont is underrated: he got the shock of his life when we were ejected from the ERM, subsequently putting in place sound economic policies. The bone idle, and bone headed, complacent lump Ken Clarke took all the credit.

James Higham said...

Australian firms are saying that their resergent dollar is going to kill business.

roym said...

BE, where has that been said about QE? thats not welcome news.

Old BE said...

Twas on the BBC site earlier. Another £75bn on top of the £175bn already printed.

Can't now find the link!

Old BE said...

Whoops, ignore me. It was a *prediction* that more QE is to come. Apolopies.

http://news.bbc.co.uk/1/hi/business/8301418.stm

Sebastian Weetabix said...

Personally I'm delighted. Us poor chumps in mfg industry now have a chance to compete, and possibly even export goods in exchange for money.

Anonymous said...

"The bone idle, and bone headed, complacent lump Ken Clarke took all the credit."

A small detail, he is also a traitor.

CityUnslicker said...

SW - Is a small mercy. A dangerous game though to make us all poorer. Inevitable though, this story has much further to run.

Steven_L said...

What well managed companies quoted in sterling earn a good mix of forex then?

I could name Vodafone off the top of my head, any others to think about?