Tuesday, 7 June 2016

Because they are worried we might vote to Remain?

Ooooo scary. Not.

10 comments:

Random said...

...to somebody holding the opposite view or they wouldn't have been able to sell it. So who is wrong?

Currency cannot be "converted" these people are fucking morons. It can only be exchanged. It is one in one out.

Lola said...

R. Yup. It is a DT article. And the DT is owned by the Barclay twins - who are said to be remainers.

paulc156 said...

When a currency goes up it's because more money is buying the currency than selling or rather the rate or pressure of buy orders exceeds the rate of sell orders.
Saying that for every seller there's a buyer so nothing doing is a bit like jumping out of a 12th floor window and citing Newtons law 'for every action there is an equal opposite reaction' so not to worry. I'm not exactly a died in the wool remainer but this blog sounds so much like an echo chamber right now, abandon all doubt all ye who enter.

Mark Wadsworth said...

R, you have beaten me to it.

What this means is that foreigners are selling UK assets (probably shares) to UK investors. So in practical terms, nothing has "left the country".

paulc156 said...

Do I hear another echo...

Dinero said...

Not an echo,
Mark and Random are correct, operationally that is the case, exchanges of currency doesn't result in deposits or notes to have "left the country", they are exchanged between custodians of them.
In fact the opposite is true of "leaving the country", if a foreigner no longer wants to hold sterling cash notes and they sell to the UK market in exchange for a different currency then sterling cash is "entering the country" not leaving it!

DBC Reed said...

@paulc
Hear,bloody, hear.The extent to which this blog has gone doolally over Brexit has undermined its economic credibility over LVT, I fear.
For an economics blog to declare "What the fuck, lets jump off the Shard with that silly arse Boris Johnson, and see what happens, its such a jape" (which is all the pro Brexit "argument amounts to) is quite insulting.
There seems to be a huge disconnect between the highly visible Brexit debate, and the invisible LVT debate about property prices which is our forte."The Big Short" demonstrated what happens when the property market becomes disconnected from, and more inflated than, the rest of the economy: something we had been pointing out for years.The attitude among the Oxbridge silly arse brigade was that this was a one-off and the markets have adjusted (ignoring the fact , pointed out by the Queen of all people, that an economic event of this magnitude should have been seen coming with a routine level of scrutiny).
In fact, the property market has continued to take money out of aggregate spending , plus the silly arses who get elected for areas with silly house prices, have taken money out of Welfare State spending,to deal with the post Credit Crunch tax deficit, further immiserating people in low house-price areas.

It is at least arguable that we can remain in the EU with tight control of house prices: the House price/ earning ratio for the UK is 81%; for Germany it is 11.2%.With such comparatively low rents and mortgages, Germans have the disposable incomes to buy and produce good stuff (such as cars) which can be exported out of the German home market to the 500 million pop. EU free trade area.We on the other hand have brands like Slazenger and Lilywhite in high(er) class sports wear which are in the hands of Mike Ashley who pays rock bottom (and the rest)so UK people cannot afford to buy them after they have been economically oppressed by the property market.
We should stay in the EU and restructure away from house-price/land price inflation instead of giving up a free trade area to which we have privileged access.

Bayard said...

"The extent to which this blog has gone doolally over Brexit has undermined its economic credibility over LVT, I fear."

Not really, what has mostly been happening is a rubbishing of the non-arguments for remaining in the EU. Why don't you balance the books by rubbishing a few of the non-arguments for leaving?

"It is at least arguable that we can remain in the EU with tight control of house prices: the House price/ earning ratio for the UK is 81%; for Germany it is 11.2%."

This situation has arisen under our membership of the EU and its predecessors, so it is very unlikely that anything will change if we remain a member. Not that that makes it any more likely that anything will change in this regard if we leave. The same "silly arses" will still be in charge either way.

The only thing that is going to change anything to do with land is to stop the English electing crappy Tory or Tory-lite governments. Since it is likely that the Tory party will be in a fair amount of trouble with their paltry majority of six, post-referendum, whichever way the vote goes, but that they will be in more trouble if the vote is to leave, then for that reason it might be a good idea to vote "leave".

paulc156 said...

Din. With respect an echo is an echo whether you think it correct or not or even if it really is correct. There is no point in repeating straw man arguments. That makes for yet more echos. Who said 'sterling was leaving the country'?

This is what I actually said. "When a currency goes up it's because more money is buying the currency than selling or rather the rate or pressure of buy orders exceeds the rate of sell orders."

If this is wrong then inform me as to how it is wrong.
Nor am I predicting sterling is doomed. Frankly I haven't any strong inclination as to the direction of sterling though I suspect it is down in the near term against a trade weighted basket of currencies. ...BUT, the idea that because for every seller there is a buyer ergo sterling reactions or levels are of no import is just rather silly. A bit like a broker informing his client that his shares in company A have fallen from £100 to a h'penny but don't worry, every time sellers come in buyers appear [with some lag] so not to worry. You'd want to take a serious look at that companies accounts/management and get rid of the broker.

DBC Read. Cheers. I concur with the view that the UK economy is so property centric it's harming the wider economy. Hence my support for LVT and C.I. I'm not especially pro EU though expect to vote 'remain'. In fact one thing that I would hope is that if the vote is for Brexit this 'might' just launch the leading lights on some sort of radical reform at the center. If nothing else to take the sting out of rising tensions across Europe. The issue I have with this blog is it seems a bit strange at times. Some interesting posts etc but on this issue it just feels like I ended up in a UKIP cult get together and it feels almost incestuous for the 'almost' complete lack of diversity. Perhaps just too few contributing full stop? Brexit obviously a no brainer could be one explanation I suppose...but when you realise that the other topic that seems to provided 100% Pavlovian type reactions, is the conspiracy of world science to subvert the planet to the belief in man made global warming, it sounds less like UKIP and more like a night out in a Wetherspoons. Hey ho...

Dinero said...

Your correct about exchange rates. But. The wording of the Telegraph article is wrong , a country's currency leaving the country is a sign of confidence in the country as people want to hold the currency of a country with which they have confidence in. The Telegraph has the description wrong.