[Closed] EU Referendum - are you in or out?

The £ will recover, we'll have a manufacturing led recovery

Why?

molgrips - Member
The £ will recover, we'll have a manufacturing led recovery
Why?

[quote=rosscore ]molgrips - Member
The £ will recover, we'll have a manufacturing led recovery
Why?
Because eventually inflation will cut in, interest rates will rise, which could happen sooner than later, bearing in mind oil is priced in USD, Gas? no idea €'s maybe, but prices are going to increase inlfation will soar above the BOE's target and away we go on another merry go round with the city boys making fortunes whatever happens, as it is some UK websites are having an absolute field day at the moment still trading on pre Brexit pricing, that is all about to change as 2017 model year pricing hits.

You do realise if interest rates rise then the economy is truly ****ed

We have an economy based on people mortgaged up to the hilt or in negative equity. If that house of cards finally collapses, it'll make the 2008 crash look like a minor blip

Because eventually inflation will cut in, interest rates will rise, which could happen sooner than later, bearing in mind oil is priced in USD, Gas? no idea €'s maybe, but prices are going to increase inlfation will soar above the BOE's target and away we go on another merry go round with the city boys making fortunes whatever happens, as it is some UK websites are having an absolute field day at the moment still trading on pre Brexit pricing, that is all about to change as 2017 model year pricing hits.

Why will that develop manufacturing?

Because eventually inflation will cut in, interest rates will rise

Well I'm not an economist, so I must be missing how higher interest rates help manufacturers.

I am, but I am thoroughly confused 😉

So had the EEC, which was why I voted to join, I don't suppose many of you did, this is my second vote on the matter, this time I corrected an earlier mistake. I never voted for the Federal Republic of Europe and I don't want to be part of it

Exactly the view of my parents and many Leave supporters who voted in '75. Everyone was lied to, it's there in black and white in the Government leaflet of the day.

Yup the £ is going to recover against the $ as it's being knocked down at the moment by traders. Govt is happy to watch as the lower rate really piles the pressure on the EU and it helps UK business. As for the € the currency isn't going to exist in its current form within a few years, it cannot survive.

Exactly the view of my parents and many Leave supporters who voted in '75

Yay, all the folks who will be over 60 by the time we leave playing with the future of the country.

Yup the £ is going to recover against the $ as it's being knocked down at the moment by traders.

why?

Govt is happy to watch as the lower rate really piles the pressure on the EU and it helps UK business.

they are not that silly

As for the € the currency isn't going to exist in its current form within a few years, it cannot survive.

True, but so what, we are not part of it?

Jamba - according to you the demise of the euro was due a couple of years ago.

@rosscore I wouldn't bother arguing with pessimists about the Economy. They want to see only bad news, press get that as they are driven now by online ads / clickbait. The use of "could" or "may" and a big scary headline = £££. So far all the data is good and has crushed the doomsday-ers IMF included. Let's just wait and see. There have been less bumps in the road so far than I expected and I didn't anticipate such a large pickup in manufacturing so quickly for certain

I'm still struggling to understand how a low pound helps UK business?

We pay more for imports, receive more for exports, correct?
But we import [i]way[/i] more than we export (by about £4.7 billion a month [url= http://www.ons.gov.uk/economy/nationalaccounts/balanceofpayments/bulletins/uktrade/aug2016#main-figures-for-august-2016 ]at the moment[/url]) so isn't that a negative effect overall?

Plus the low pound means we all pay more for fuel which increases costs further.

Why why why? Don't any of you read anything?

Forex is largely a fully computerised activity these days, billions are traded by algorithms, which dwell on anything said by virtually anyone in positions of power, if Carney so much as hinted on restoring the interest rate level to 1/2 of one percent you would see a recovery in sterling.

So it went down, did any of your mortgages, I have a two year fixed, its ending as I write this, my new mortgage is more expensive, despite the lower interest rate, why, because mortagage companies can't make a margin over the base rate so they apply what the hell they like and the market will take.

So far all the data is good

Simply untrue

No Graham, you need to think about net exports (ie. exports minus imports)

Jamba - according to you the demise of the euro was due a couple of years ago.

Fell free to find a post from me saying it would collapse in 2014 8)

Many many people will tell you its already dead, the Greek "bailout" was simply a delaying tactic to avoid a collapse of Spain and Italy. Quite a few articles appearing speaking of as a minimum an Italian exit from the euro (so they can control their own economy and devalue their currency to increase competitiveness). If LePenn wins I her to win a Referendum on exiting the euro. Deutsche Bank published a piece a while ago saying Germany may leave first to get away from all the indebted Southern European nations.

Deutsche Bank published a piece a while ago saying Germany may leave first to get away from providing the RoEU with artifically low interest rates, funding their consumption and housing booms, and expanding their current account surplus without affecting relative exchange rates!

They want to see only bad news

No, I really want to see good news. I don't like feeling this depressend and anxious.

Fully accept that the Euro is a potentially dodgy idea. No need to convince me there.

Why why why? Don't any of you read anything?

Yes, but I haven't you explain why you think there'll be a manufacturing led recovery.

As for the € the currency isn't going to exist in its current form within a few years, it cannot survive.

So the Euro will be dead and gone by 2018? Are you prepared to put some money on that bet? As I will take it.

jambalaya - Member
... So far all the data is good and ...

and it really isn't.

No Graham, you need to think about net exports (ie. exports minus imports)

I thought I had?

Figures for August 2016:

Goods Export: £25.8 billion
Goods Import: £37.9 billion
==============================
[b]Net Goods: -£12.1 billion[/b]

Services Export: £19.3 billion
Services Import: £11.9 billion
==============================
[b]Net Services: +£7.4 billion[/b]

Net Goods:   -£12.1 billion
Net Services: £7.4 billion
==============================
[b]Overall Net: -£4.7 billion for August[/b]

Is that not right?

I'm using this as source:
https://www.ons.gov.uk/economy/nationalaccounts/balanceofpayments/bulletins/uktrade/aug2016

Yes and No. You need to examine trends in X-M ie net Xs over time

We run trade deficits consistently - that it not the issue. The issue is the extent to which a fall in the £ affects the level of net exports. After the J-curve effect, it will have a positive impact on this and therefore on UK National Income (all other things being equal)

all other things being equal

Maybe it's all just a wheeze to devalue the pound and get interest rates back up. Not sure they are they clever though.

They're not. But the first bit (deliberately devalue £) is true, but its a zero-sum game because lots of economies are doing the same thing

GrahamS - Member

I'm still struggling to understand how a low pound helps UK business?

We pay more for imports, receive more for exports, correct?
But we import way more than we export (by about £4.7 billion a month at the moment) so isn't that a negative effect overall?

Plus the low pound means we all pay more for fuel which increases costs further.

The theory is that by devaluing the £ either on purpose, or by doing something really stupid for the sake of Blue Passports. We make British made goods cheaper on the global market.

So maybe someone like Hope can undercut Raceface in the EU or US and sell a few more cranks and brakes, but like you say it won't work because economies don't work like that - you can't just change one thing to make one industry better without everything else being affected.

To make the UK a manufacturing, exporting powerhouse again we'd either have to build a HUGE high-end manufacturing base - I know we make a lot of great, high-end things in the UK for export, but to base an economy on it we would have to compete with Germany, and it's too late - we lost that fight. The world wants Siemens, not Amstrad, Audi, Mercedes, BWM, not Rover and Austin.

Or we mass produce more low-end stuff, and try to compete with China and the rest of the Far East, undo 40+ years of manufacturing decline - build new factories, I would actually probably like that, not that I want to work in a factory - but full employment and a proper employed, proud, working class - but the pain and suffering we'd face - our economy would have to tank for years, and years and years for the £ to be so worthless that you could build plastic crap in the UK cheaply and even then - the Chinese would undercut us.

The 'new world order' has been agreed, in the Global Economy the East makes stuff, the West buys stuff - we pay our way by doing stuff for each other and inflating our debt away which makes the stuff we buy from the east cheaper. Like it or not, that's the way of things and no amount of rose tinted views of a past that didn't exist is going to change that - there is nothing to be earned from being a small player in the global economy.

Like this showing X-M as % of GDP over time?

[img] [/img]

After the J-curve effect, it will have a positive impact on this and therefore on UK National Income (all other things being equal)

The snag being that trade and tariff changes will mean that all other things are not equal?

And if the Euro crashes as Jamba predicts then our lower prices may not increase demand as our biggest importer will be hurting too.

[quote=rosscore ]

mortagage companies can't make a margin over the base rate so they apply what the hell they like and the market will take.

Eh? the banks are under no obligation to give you the BOE base rate. Tracker deals are generally short term then reverting to a higher rate.

Even a quick play with the Barclays site tells me that a 25 year mortgage for £180,000 with a 2 year tracker period, you would repay £272,097. That's a massive profit of £92,097 which is 52% of the original loan.

In fact even if they gave you their tracker rate for the full 25 year term, they'd still make £62k/35% profit.

Indeed

And a disorderly collapse of the euro would hurt us all.

Rosscore - cheer up. You're coming over like a bitter old man. It's us remainers who are meant to be bitter about the damage you've done to the country we love. Be more like chewkw - spaced out and happy - or Jamba - black knight-esque optimism.

Do cheer up, you won. Maybe.

PS - took me ages to work out who Jamba's pronouncements reminded me of. '''Tis but a flesh wound to the economy.
Jamba- that's you're pronouncements on here - other threads would show you to be a decent individual.

IT'LL BE FINE

GrahamS - Member

I never voted for the Federal Republic of Europe and I don't want to be part of it

As pointed out before the "United States of Europe" was very much part of Churchill's original vision in 1946.

igm - Member
Rosscore - cheer up. You're coming over like a bitter old man

Yes I was a couple of times back there, my apologies for that, I do try not to be bitter despite having lost everything simply because we are part of that monstrosity. Won? I've won nothing, none of us have won anything, the world goes on and only the masters of the city boy universe win. They win whatever happens, if they lose we bale them out, if the £ tanks they win on the short.

Incidentally, how's the price of steel? I heard the price of scrap metal has recovered recently (another pub conversation where these things are always more cheerful and the irony shines through)Maybe there's a spark of hope for the steel Industry here.

Try not to think of me as bitter, I have been trying to offer the suggestion that it's not as bad as the remoaners would have you think and it'll work out, as I said back there traders will trade on regardless even though we've put up the trade barrier of devalued sterling, traders will still find a way.

On a lighter note, anyone seen the front cover of the mail today. They're trolling their own readers. Article lead is how the refugee/migrant children don't look like children, picture lead is Cindy Crawford (50) and her teenage daughter stating how you can't tell them apart. 🙄

[img] [/img]

So it went down, did any of your mortgages, I have a two year fixed, its ending as I write this, my new mortgage is more expensive

Ummm.. yes?

We remortgaged 6 months ago at 2.49% fixed for 5 years 4 months.

Prior to that we'd been stuck on a 4.99% standard rate, so the change means we are paying about £200 less a month.

If we'd waited till today we could get a fixed rate between 1.94% to 2.03% on the same terms.

Incidentally, how's the price of steel? .. the irony shines through)

[img] [/img]

I do try not to be bitter despite having lost everything simply because we are part of that monstrosity

So what exactly happened? You were outbid by an EU competitor that had been given some advantage by the EU or something?

and when the UK is shot of the EU how will life be better?
In other news I have a new headache & migraine cure
[img] [/img]
Some minor side effects but we are working on those

Tariffs are up on steel.

http://www.telegraph.co.uk/business/2016/10/07/eu-slaps-steep-tariffs-on-cheap-chinese-steel/

The irony.

I'm not sure how leaving the EU will help the UK steel industry, because if we default to the WTO we won't be able to implement any tariffs so we will be flooded with cheap steel subsided by the Chinese government.

Unless we are planning on reforming not only EU rules but WTO in 2 years as well?

Rosscore - given what I do and who I do it for (not hard to work out off the web I suspect) it'll work out for me regardless I suspect, but for those lower down the employment scale I suspect it's going to be really tough.
It has also got the potential to hurt what my cousin does (road manager for medium sized bands) - he works all over but getting visas and permits is the bane of his life - the logistics of getting the visas and trying to work simultaneously is fun. He was looking forward to just doing Europe and not needing as much paperwork - that's going to get very difficult so we may see fewer touring bands.
My son from age 8 has wanted to do a ski season in the Alps - it'll probably still be possible but it will be harder (we'll see if the eurotypes want to hand seasonal visas for jobs their own kids could do).

As for the economy, well I'm sure the Brexit fantasy team predictions will come true. Or not. Doesn't look good for a decade or two though does it?

Not given the government forecast is for a 4.5% drop in GDP as a result - thats a massive recession coming. Remember we have not left yet so the bad effects we see so far are only the tip of the iceberg.

what my cousin does (road manager for medium sized bands)

your cousin is clearly a masochist. he's gonna love it.

Not given the government forecast is for a 4.5% drop in GDP as a result - thats a massive recession coming.

Blimey, I missed that. If true 😉 that's very bad news

Doris5000 - you may have a point. But he is getting married to a French lass and was thinking of a slightly less masochist lifestyle. Slightly.

As for the economy, well I'm sure the Brexit fantasy team predictions will come true. Or not. Doesn't look good for a decade or two though does it?

No, as the economy deleverages we will have a sustained period of sub-trend growth. This will be compounded by Brexshit. With the fall in the pound, inflationary pressures will re-emerge and this may bring an end to the period of extraordinary monetary policy which (together with [s]austerity[/s] loose fiscal policy) has kept us going artificially.

The end of QE is unlikely to be an orderly process. Forget Brexshit at that point, we will have own issues to deal with then and it wont be pretty.

The last thing we needed was Brexshit adding to the challenges. Self harm

4.5% must be from here: http://www.independent.co.uk/news/uk/politics/brexit-theresa-may-britain-lose-45-gdp-eu-customs-union-a7369181.html

I'm this will be disputed as Remoaner Project Fear by the Bretards however.