The UK is a good example of how much damage you can do yourself (nationally) by just disregarding facts and reality for a few years. Our own biggest enemy is our massive arrogance.
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British pound hits record low against the dollar
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Re: British pound hits record low against the dollar
#202The UK is a good example of how much damage you can do yourself (nationally) by just disregarding facts and reality for a few years. Our own biggest enemy is our massive arrogance.
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Re: British pound hits record low against the dollar
#203Not really surprising that there's a lack of confidence in the untested combination of reducing tax (for high earners) and increasing borrowing. At first glance, that would seem to be a recipe for high inflation.
Re: British pound hits record low against the dollar
#204Earlier quoted context omitted.
It's funny how Trump and Brexit have become these catch-all bogeymen that every societal ill is reflexively attributed to.
That's what happens when you have governments that only care about themselves and their friends, and not the people they are governing - even if not everything is their fault, experience tells people that they're likely to blame in some part as they've lied so much everywhere else.
Experience might cause people to believe that, but that doesn't mean it's true. It's just standard world-weariness against leaders.
Re: British pound hits record low against the dollar
#205Earlier quoted context omitted.
I presume you're referring to Brexit, but this seems to be mostly a strong US dollar and energy crisis story. Europe is in a similar situation so I'm not sure what difference staying/leaving would have made.
Brexit is example number one but there are 101 other examples (including our approach to energy and our approach to "solving" the energy crisis). The USD is strong, but that's only half the story here. Just look at EUR vs GBP since Brexit: down 20%. We're doing 20% worse than Europe, an economy with the same issues around energy as ours, plus no real decisive government and which just finished dealing with a debt cri…
> Just look at EUR vs GBP since Brexit: down 20%.
We weren't on the Euro when we were in the EU.
Re: British pound hits record low against the dollar
#206The UK is a good example of how much damage you can do yourself (nationally) by just disregarding facts and reality for a few years. Our own biggest enemy is our massive arrogance.
Your comment doesn't contain any point.
However, I'm from the UK and don't include myself in your "massive arrogance" statement. It just appears inflammatory.
Re: British pound hits record low against the dollar
#207Earlier quoted context omitted.
You don't sell for less, since you sell in foreign currency. So you get the same amount of foreign currency (price in USD remains the same), but you need less converted to your internal currency to pay your labor. But then you can invest that extra profit in decreasing your foreign currency price, thus becoming more competitive. You can google for longer explanations of why a weak currency is excellent for exporters,…
I just Googled it, and this is what I found [1]: When a country's currency appreciates in relation to foreign currencies, foreign goods become cheaper in the domestic market and there is overall downward pressure on domestic prices. In contrast, the prices of domestic goods paid by foreigners go up, which tends to decrease foreign demand for domestic products. A depreciation of the home currency has the opposite effe…
Read again carefully what you quoted. It exactly supports my claim.
> Export dependent nations may actively encourage a weak currency in order to boost their exports.
> A weak currency may help a country's exports gain market share when its goods are less expensive compared to goods priced in stronger currencies. The increase in sales may boost economic growth and jobs while increasing profits for companies conducting business in foreign markets
Re: British pound hits record low against the dollar
#208Earlier quoted context omitted.
I presume you're referring to Brexit, but this seems to be mostly a strong US dollar and energy crisis story. Europe is in a similar situation so I'm not sure what difference staying/leaving would have made.
Indeed EUR/USD is not doing great either: https://www.google.com/search?channel=fs&client=ubuntu&q=EUR... .
That being the case, compare it with GBP/EUR over the same time period. The US Dollar is indeed doing well overall, but the Euro is doing nowhere as badly as the Pound Sterling is.
Re: British pound hits record low against the dollar
#209I'm not sure it's so much a story of the British pound, as of the US dollar, given that the pound-euro exchange rate is still well within it's range for the last 5 years:
https://www.xe.com/currencycharts/?from=EUR&to=GBP&view=5Y
The Chinese yuan and Japanease yen are also both at their lowest value vs the dollar in recent years, and moving faster than they normally do.
For each of these (UK, EU, China, Japan) there are local conditions you can blame the currency depreciation on, but given the number of major currencies depreciating rapidly vs the $ I think it makes more sense to look at what the US is doing as the simplest explanation.
Re: British pound hits record low against the dollar
#210It's worth noting that there was an apparent real opportunity to resolve the Russia-Ukraine conflict in April 2022, via diplomatic negotiations, but UK's Boris Johnson reportedly disrupted those talks by threatening to withdraw UK/US support for Zelensky if he proceeded with negotiations. If the war had been resolved and sanctions on Russian export of gas to Europe had been lifted, this would have lowered gas prices across the entire region, including for Britain. These energy costs are the main driving factor behind the skyrocketing inflation in the UK:
https://www.cbc.ca/news/world/uk-energy-costs-inflation-1.65...
However, the steep rise in the value of oil & gas stocks, as well as defense contractor stocks, has no doubt enriched a certain strata of British society, much as it has done in the USA. War is quite profitable if you position yourself correctly...
https://www.investopedia.com/top-defense-stocks-5079150
> "Russia's ongoing invasion of Ukraine beginning in February sparked a rally in selected large defense stocks, including Lockheed Martin Corp., Northrop Grumman Corp., and Raytheon Technologies Corp."
https://www.investopedia.com/investing/oil-stocks/
> "Russia's invasion of Ukraine in February has significantly disrupted the global oil market. European Union leaders moved to ban most Russian crude oil imports in May a oil prices spiked in March. The Biden administration has released record volumes of oil from the U.S. strategic reserve...The oil and gas industry is best represented by the Energy Select Sector SPDR ETF (XLE). The exchange-traded fund produced a total return of 59.8% over the past year, dramatically outperforming the Russell 1000’s -12.9% total return."