British Pound in Free Fall - Biggest One Day Decline vs $ in 37 Years
Oct 24th, 2008, 12:04 PM
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British Pound in Free Fall - Biggest One Day Decline vs $ in 37 Years
Well was down to $1.63 yesterday and today NPR just reported the Pound had its greatest one-day decline against dollar in 37 years.
Did not give the rate.
Where is the great British economy BritFodorFriends were crowing about not that long ago?
Few weeks ago reports that stores in Germany were declining to take British credit cards. Is the sun setting on the great British economy?
Oh well maybe i can afford a pint more often now.
Did not give the rate.
Where is the great British economy BritFodorFriends were crowing about not that long ago?
Few weeks ago reports that stores in Germany were declining to take British credit cards. Is the sun setting on the great British economy?
Oh well maybe i can afford a pint more often now.
Oct 24th, 2008, 12:25 PM
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Planning a trip there in June so that's good news. Bad news is, will I have any $$ left by then?
www.hereinfranklin.wordpress.com
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Oct 24th, 2008, 12:27 PM
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According to xe....the closing rate for the GBP today was
$1.5884887759
I had been predicting $1.50 by the end of the year..it looks like at this rate it'll be $1.50 by the end of the month....
As far as not accepting British credit cards, that makes no sense...the credit card is negotiated in local currency so what difference does it make to a merchant what the rate is for the GBP against the euro? The merchants gets his or her euro, the credit card company does the conversion at the rate the instant the charge hits the international credit card system so that rumour just cannot be true.
$1.5884887759
I had been predicting $1.50 by the end of the year..it looks like at this rate it'll be $1.50 by the end of the month....
As far as not accepting British credit cards, that makes no sense...the credit card is negotiated in local currency so what difference does it make to a merchant what the rate is for the GBP against the euro? The merchants gets his or her euro, the credit card company does the conversion at the rate the instant the charge hits the international credit card system so that rumour just cannot be true.
Oct 24th, 2008, 01:01 PM
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Well you are right about stores being protected but the report i read and cannot remember where or heard said that some small stores nevertheless were refusing it - perhaps not understanding that they were so protected. Apparently it was defused quickly by the card companies - if it ever happened.
Oct 24th, 2008, 01:28 PM
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See...when a merchant takes a credit card, it makes no difference what bank and in what country and in what currency the card is denominated...it's a visa card or it's a mastercard card or its an Amex card or whatever...it's not a British visa card, it's not an American mastercard card...they swipe it (or insert it in the chip reading terminal), either they get an approval code or they don't.
Now because of the chip and pin situation in the UK, perhaps there is a further question but you hand the clerk the credit card and it shouldn't matter.....
Unless, of course, the merchant is pulling the dynamic currency conversion scam (incidentally we haven't heard much about that recently)...in which case of course the exchange rate matters. Perhaps these merchants were pulling that scam (although for the most part I have never run into it in Germany) and with the rate fluctuating so much (although I don't think the GBP against the euro has been all that volatile) they (or whomever sets the rate) don't know what the rate should be...
Now because of the chip and pin situation in the UK, perhaps there is a further question but you hand the clerk the credit card and it shouldn't matter.....
Unless, of course, the merchant is pulling the dynamic currency conversion scam (incidentally we haven't heard much about that recently)...in which case of course the exchange rate matters. Perhaps these merchants were pulling that scam (although for the most part I have never run into it in Germany) and with the rate fluctuating so much (although I don't think the GBP against the euro has been all that volatile) they (or whomever sets the rate) don't know what the rate should be...
Oct 24th, 2008, 01:51 PM
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The events in the near future are rather easy to predict.
1) right now, american (institutional) investors sell all their foreign assets and gold exchanging them for $$. They do so because they need liquidity ("cash"
to pay for their immediate obligations and to keep things running. Nobody wants to lend them anything anymore so that's the only alternative.
(=rising USD)
2) once every foreign asset has been sold, they find they still need more money and normally would go broke.
3) The state will guarantee and keep them in business, while in reality they should have been liquidated.
4) In no time, the state will own all the bad debt, which it either can't pay back or tries to get rid of by "printing" money.
5) In any case, the game is over.
The crash will be brutal and fast.
1) right now, american (institutional) investors sell all their foreign assets and gold exchanging them for $$. They do so because they need liquidity ("cash"
to pay for their immediate obligations and to keep things running. Nobody wants to lend them anything anymore so that's the only alternative.(=rising USD)
2) once every foreign asset has been sold, they find they still need more money and normally would go broke.
3) The state will guarantee and keep them in business, while in reality they should have been liquidated.
4) In no time, the state will own all the bad debt, which it either can't pay back or tries to get rid of by "printing" money.
5) In any case, the game is over.
The crash will be brutal and fast.
Oct 24th, 2008, 02:21 PM
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"In any case, the game is over.
The crash will be brutal and fast"
I am not so sure, the whole game rests upon confidence, once Bush is out confidence will return, that will ripple through the rest of the world. I give it 9 months and all will be well agai
n. ;-)
Muck
The crash will be brutal and fast"
I am not so sure, the whole game rests upon confidence, once Bush is out confidence will return, that will ripple through the rest of the world. I give it 9 months and all will be well agai
n. ;-)
Muck
Oct 24th, 2008, 02:43 PM
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Muck, what will be interesting is the next step, when they'll be running out of (foreign) investments to liquidate and ask uncle sam to help them out. Hundreds of banks (and others) should collapse during those days. Will they all be bailed out?
Oct 24th, 2008, 04:14 PM
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It is not really the Pound falling, it is the US $ rising. It is rising against most currencies at a torrid rate.
Aguments that a rising currency exchange rate is a relative indicator of a superior economy are really quite simplistic.
This has more to do with the freffal that is occurring in the price of oil than it does with the US economy being superior to the rest of the worlds.
So then , 3 months ago the US economy sucked and now it's gone gangbusters and is whooping the rest of the world? I mean REALLY!
Aguments that a rising currency exchange rate is a relative indicator of a superior economy are really quite simplistic.
This has more to do with the freffal that is occurring in the price of oil than it does with the US economy being superior to the rest of the worlds.
So then , 3 months ago the US economy sucked and now it's gone gangbusters and is whooping the rest of the world? I mean REALLY!
Oct 24th, 2008, 04:22 PM
#10
I don't pretend to understand this, I'm just glad I leave for the Europe and Morocco on Monday! And I hope the rates last until I come back in December - I think I may take enough cash out to last for my visit at the beginning in case the dollar tanks mid-trip.
I've been saying for years that the economic situation in the US is a house of cards - it's built on the "American consumer", but with jobs being off-shored, how can consumption continue?
I've been saying for years that the economic situation in the US is a house of cards - it's built on the "American consumer", but with jobs being off-shored, how can consumption continue?
Oct 27th, 2008, 06:22 AM
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It is not really the Pound falling, it is the US $ rising. It is rising against most currencies at a torrid rate>
you may be right but it seems the pound is even falling plunging faster than the euro and other currencies vis-a-vis the greenback?
you may be right but it seems the pound is even falling plunging faster than the euro and other currencies vis-a-vis the greenback?
Oct 27th, 2008, 06:32 AM
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>>Aguments that a rising currency exchange rate is a relative indicator of a superior economy are really quite simplistic.<<
Totally agree, but the "one isn't falling -- the other is rising" argument seems to be pointless. From the individual's point of view, what's the difference?
Totally agree, but the "one isn't falling -- the other is rising" argument seems to be pointless. From the individual's point of view, what's the difference?
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