[Closed] Osbourne says no to currency union.

Tomorrow's Herald:

[img] [/img]

If this is true...

For me having read the speech Mr Osborne has made it clear that he is against a currency union at the moment. I do believe that he might well "revise"his position as the referendum draws nearer. I would also saythat the UK government has now started to prenegotiate....so can we look forward prenegotiation on other issues too? Like EU membership for example. I think we can now say the phoney war is over and the real campaign can begin.

THM Well done to the doctor in the audience v Ukip woman. 🙂

Carefully nuanced article on some of the realities underpinning the current debate here if anyone's interested.

[url= http://www.futureukandscotland.ac.uk/blog/currency-reflections-legal-issues ]http://www.futureukandscotland.ac.uk/blog/currency-reflections-legal-issues[/url]

Agreed Gordi. Quite a lot of unexpected ideas this week including Winston's comments on passive smoking and children!! Fun day, good night. Hope dear Nicola manages to sleep ok after her mauling by Andrew Neil.

I do believe that he might well "revise"his position as the referendum draws nearer.

Nah, he'll do that after the referendum if it goes the wrong way. Till then, they just want headlines that currency union is a no go, whilst wording their comments very carefully to give enough wiggle room to do a u-turn in the unlikely event that the bluff is called.

If this is true...

Of course it is... nothing final about the vote, it does not "offer clarity" as many claim, because the losing side will claim that what people really want is something in between YES/NO, and will use this so as to either give less, or gain more, powers.

So if its a yes vote but Westminster doesn't fancy the negotiations its a status quo?
Thats bullshit, what stinks even more is that its apparently a senior figure in the coalition thats coming out with this pish.
That would look great next time the uk signed any treaty wouldn't it!

Surely if Scotland wishes to be truly independent then they would also not want to have any financial tie to the rest of the UK (or whatever it would be called if independence went ahead)?

Similarly, currency union and unilaterally adopting the pound (or euro, or whatever) do both involve an independent scotlAnd having its economy and interest rates influenced by decisions made overseas - but that's just life as a small country. Currency and finance markets are global, and interest rates are set in consideration of those markets and bigger regional players. Custodians of small currencies can't fight off the combined powers of the market and bigger currencies, and incur higher transaction and credit costs - so why have them?

Equally you don't need your own currency to have a central bank, federal reserve or lender of last resort...

How much will it cost to reinstate Hadrians wall and will both sides have to pay half

How much will it cost to reinstate Hadrians wall and will both sides have to pay half

It goes through Northumberland!

Maybe it would make more sense to divide the nation along the Antonine Wall instead?

Equally you don't need your own currency to have a central bank, [s]federal reserve [/s]or lender of last resort...

I am sure anyone is arguing that.

Most people I know who live North of Hadrian's Wall would be happy for the border to be there.

Then again, most people I know who live north of the Watford Gap would be happy for that to be the border too...

trout - Member
How much will it cost to reinstate Hadrians wall and will both sides have to pay half

It was built to limit the barbarians access to and was paid for by the barbarians. So that's you lot down south of it...

(Terry Jones reference 🙂 )

I just watched the BBC interview with Nicola Sturgeon. 11 minutes long and she did not, indeed would not, answer one question put to her. She squirmed, changed the subject, answered the questions she wanted to hear and generally embarrassed herself.

And this differentiates her from every other politician how exactly?

they all do this

Its tragic they are not allowed to accept weakness in their position or have a groen up debate* and the questioners ask such leading questions they are almost trolls

Its rarely worth listening to a politician being interviewed tbh

* the real answer to many questions is we dont know until we negotiate but that would never be accepted so they insits a view is true even when they know it will end up being negotiated and no one [ on either side] knows exactly what a separation would entail [ well not to the detail required by an interviewer ] but no politician will ever say thi.

Carefully nuanced article on some of the realities underpinning the current debate here if anyone's interested.

http://www.futureukandscotland.ac.uk/blog/currency-reflections-legal-issues

That was a really interesting read from what looks like a credible source. Cheers.

So if its a yes vote but Westminster doesn't fancy the negotiations its a status quo?

That's what's alleged - if true it's a pretty serious development. Refusing to go along with a referendum because they don't like the result would put the UK in pariah state territory.

Wars have started over less.

Of course it could all be the latest from Project Fear - "don't bother voting, you won't get independence anyway".

That was a really interesting read from what looks like a credible source. Cheers.

+1 interesting about how the debts is and remains with the UK so scotland cannot default on it.

But clearly that was dealt with by Macpherson in the Treasury letter:

[i]if you follow Treasury advice and this week rule out a currency union in the event of Scottish independence, you can expect the Scottish Government to threaten not to take on its share of the United Kingdom’s debt. I do not believe this is a credible threat. First, the sooner an independent Scotland established economic credibility, the better it would be for its economic performance. An extensive wrangle about its share of the debt would increase uncertainty and hence its funding costs. Secondly, the debt is one of a number of issues which would have to be settled post independence, where the new Scottish state would require the cooperation of the international community including the continuing UK.

As for the impact of the threat, much will depend on the markets’ assessment of the probability of a pro independence vote and the likelihood of the Scottish Government seeing the threat through. In the short run, any uptick in gilt yields is likely to be small. And in the worst case scenario, it is more than likely that the increase in funding costs, which the continuing UK would face, would be smaller than that which would result from an ill thought out currency union with Scotland.[/i]

No one is saying don't bother voting because you won't get independence anyway. What the technocrats, NOT the politicians are pointing out, is the reality of the situation. Under a currency union you give up full independence over your economic decision making - both monetary and fiscal policy. That is as clear as night and day. In essence that was Carney's basic message. Of course the politicians don't like this because the truth does not fit their agenda and the deceit in the BoD.

We have a very clear example of this in Europe. Or course there is a fundamental difference in that the €-zone does not satisfy the criteria for an optimum currency which is why it will fail at some point in the future. It has to by design. In contrast, the UK does satisfy the criteria which is one reason (as yesterday's paper made clear) why the sterling union has been so successful. But leaving the difference aside, there is one fundamental message - for a currency union to work you need a full interdependence not independence of both fiscal and monetary policy. As carney put it, you have to be prepared to cede national sovereignty. There are only a few people who still prefer to ignore this truism and float along in la la land.

Re default, the article is clear in the ambiguities. If Scotland were to walk away completely that would be a technical default rather than a standard/legal one. * The result would be the same - it would be extremely damaging to a new nation and would also be damaging to rUK clearly. Hence the HMT made it very clear that the debt would be fully honoured whatever happened. But and it is a big BUT, no serious Scottish politician would seriously walk away without taking a share of the debt (* see below again). Dear Nicola said as much yesterday. That would be economic suicide. Instead they will continue the missing dollar pretence for as long as they can.

I disagree that it is best to ignore the issues pre the event. What is different in this case is the interventions of the non-aligned technoctrats - the EU, HM Treasury and the BOE. Unusually we are not left with politicians spouting BS. We have very different and independent sources laying out the technical details. That is very important for the quality of the debate.

What happened yesterday was interesting and unusual in that the details were laid out and three politicians essentially followed the technical script. Each one was actually quite bland and dry. But the message and the fact that is was co-ordinated was very telling. In contrast, the yS has been littered with bold assertions that do not stand up to analysis. This has happened time and time again. The subterfuge is being laid bare - as in the nonsense about assets and liabilities.

The no campaign has been playing a quiet campaign to date, but now the rUK is making its voice heard. This is not just about Scottish interests. The rUK will defend theirs too even if AS and NS dislike it. This is not and can never be a unilateral decision.

Jim Sillers, the veteran campaigner for independence nailed it yesterday, how can (a supposedly) canny and experienced politician not have a contingency plan - a plan B. Obscuring that fact with his own three Bs is a very poor substitute and unworthy.

* it's actually a false debate. The debt will not be carved up. That is the wrong idea. That cannot work for the simple reason that it would be impossible to do this. Why would some investors accept debt in a new state with the added risk. In practice what will happen is that Scotland will issue its own debt and then pay an equivalent financial amount over to the rUK. The existing bond holders will not be affected directly, [b]So there is no debt to actual default on.[/b] It is a technical default if Scotland chooses not to make the financial transfers. But right from the start, Scotlland would need a plan for raising its own debt. If this is preceeded by walking away from agreed obligations then the results are pretty obvious to imagine. Why would HM Treasury recommend calling their bluff otherwise? It wouldn't make sense.

[b]Did you read the link ? [/b] they addressed that claim and it used legal rather than an appeal to consequences of "defaulting "
Its also addressed the credibility issue.

Scotland cannot default on the debt as it is not theres to default on only the UK can default as they were who took it out and they are who the debt remains with

GO has said the UK will continue to pay it to calm the markets for example so it looks like rUK knows the reality

No one is saying don't bother voting because you won't get independence anyway.

I was referring to the story in the Herald that the Westminster government might not allow independence if the negotiations don't go the way they like.

This is not and can never be a unilateral decision.

That's the implication - but that's very wrong. It must be a decision for the people of Scotland alone.

But and it is a big BUT, no serious Scottish politician would seriously walk away without taking a share of the debt

Nor walk away without a share of the assets

they can technically walk away as you call it because legally it is not there. They cannot ever default as it is the Uk's debt but yes it is HIGHLY UNLIKELY they will take no debt.

will the markets not admire the brilliant way they have started with zero debt if they do walk away

the country is certainly more financially stable without a debt burden than with so I am not sure they will use punitive rates - they may threaten it but they know the real risks are low.
again its just more guess work and shows the risks involved and how the negotiations will be messy

It must be a decision for the people of Scotland alone.

But if it's going to affect me shouldn't I get a say too??

That's the implication - but that's very wrong. It must be a decision for the people of Scotland alone.

Just as ceding sovereignty in a currency union is the rUK voters decision alone

Good luck convincing them 😉

The vote is for the people of Scotland - true Ben.

The adoption of a currency union isn't, again by definition. It's a union ie more than one party. That's the on-going deceit. The yS campaign keep suggesting that all these extras can be picked off the shelf independently. They cannot.

Perhaps what the herald is saying is that the rUK will not agree to some of the structures that the BoD promises as part of their vision for independence. That is a different thing. But I can't read you herald post on my screen.

But if it's going to affect me shouldn't I get a say too??

No, sorry. Your politicians will get involved with negotiating the best settlement for you, but in the basic matter of whether Scotland gets independence - no, that's up to the people of Scotland, no-one else.

The yS campaign keep suggesting that all these extras can be picked off the shelf independently. They cannot.

On the contrary, it's the No side who are saying that things can be picked off the shelf independently - Scotland must take a share of the debt, but the currency won't be shared.

[url= http://www.heraldscotland.com/politics/referendum-news/yes-does-not-mean-yes.23438016 ]The Herald article.[/url]

Exactly Ben, but you need to know exactly what it is that you are voting for. It's not what the BoD implies by a long shot.

Thanks for the link, but I need to subscribe!

Scotland must take a share of the debt, but the currency won't be shared.

You will be telling me next that this is because the currency is an asset and the debt is a liability. Where's the dollar? 😉

Thm,do you put in statement like this

the no campaign has been playing a quiet campaign to date

Having just returned from Mars? The names for the no campaign are bitter together and project fear,names now passed into common usage. As much as you would like to pretend otherwise the no campaign has been anything but quiet,hence the comparison on page 2 to an abusive partner,and the numerous posts on this very thread on the nature of their campaign. What would your definition of a "loud" campaign be; airstrikes?

Helped the Irish bailout without asking the people of the uk? Oh aye, they got involved in the financial matters of another country.. because they know how connected both economies are.
its amazing how decisive politicians can be when they need to be eh?

Jus reflecting what their own people have been saying. Lots of criticism of darling being lacklustre. But as this week has shown, quietly and behind the scenes he has been planning with devastating consequences, I for one, misjudged him.

Meanwhile the empty vessels continue to make the most noise....perhaps Queen's "I want it all" as a rallying anthem?

[Abusive partner or parent, dear Nicola better phone the childline then!! ]

Mars rock going cheap if you are interested.

quietly and behind the scenes he has been planning with devastating consequences

You make him sound like a Martian in War of the Worlds 😉

I was referring to the story in the Herald that the Westminster government might not allow independence if the negotiations don't go the way they like.

So in your mind Scotland can just demand absolutely anything in the negotiations, and if Westminster doesn't agree to it then they are being evil bullies?

And why is it reasonable for Scotland to threaten not to take a share of the national debt?

He looks like one of Gerry andersons puppets

Well he has coordinated three warring parties, the BOE and HM Treasury. That is no mean feat. Meanwhile he let's yS condemn themselves out of their own mouths while delivering the occasional killer blow. Very smart bridge playing.

So in your mind Scotland can just demand absolutely anything in the negotiations, and if Westminster doesn't agree to it then they are being evil bullies?

No, Scotland can demand anything, rUK can demand anything, with negotiation an amicable settlement is reached, or not. But if the vote is for Yes, independence is not up for discussion.

You remember what happened at the end of the War of the Worlds? The Martians were defeated by tiny creatures no-one could see.

In our case, that's the midges.

I just can't see how there can be an effective currency union when the aims of the two parties are quiet so different.

How can two countries with different objectives share one bank?

Or the first foot and mouth from "carry on up the kyber?" Where's Terry Scott (RIP) when you need him?

How can two countries with different objectives share one bank?

To be honest, it's not an issue I'm all that fussed about either. It makes sense for trade to keep one currency, but a Scottish Pound pegged to the rUK Pound would do just as well for that, and even if it's not pegged it's not a massive deal.

Just give us our share of the Bank of England reserves, and we'll set up our own central bank.

Heh,l have a polish laddie just joined my dofe group,he didn't know what midges were..his wee face on being shown youtube 😈

To be honest, it's not an issue I'm all that fussed about either. It makes sense for trade to keep one currency, but a Scottish Pound pegged to the rUK Pound would do just as well for that, and even if it's not pegged it's not a massive deal.

It seems to be a deal-breaker for AS though...

Just why is he so keen to keep it?

I've no problem with debts/assets being shared equally, that is only fair.

Just why is he so keen to keep it?

No idea.

I think maybe it's a negotiating stance - you don't reveal your plans B, C and D until you can't have your plan A. And that (despite the triumvirate's pronouncement) won't be decided until after the referendum.

Scotland can just demand absolutely anything in the negotiations, and if Westminster doesn't agree to it then they are being evil bullies?

Thing is, that this whole episode has been kicked off not by Salmond (et al) 'demanding' anything in the negotiations, but rather they have asserted something as a universal and settled fact in their white paper, when in fact its a negotiating position.

[i]Scotland [b]will[/b] continue to use the pound[/i]

The reaction by the unified westminster parties to rule it out has to be seen in that light, its not a negotiation, but a rebuttal of a direct claim made by the yes campaign and put forward as a foregone conclusion.

Salmond's campaign has repeatedly been caught out telling lies to the public about what will happen in the event of a yes vote (the advice over EU membership for example) - countering these lies cannot be seen as bullying, its setting the record straight!

No idea.

I think maybe it's a negotiating stance - you don't reveal your plans B, C and D until you can't have your plan A. And that (despite the triumvirate's pronouncement) won't be decided until after the referendum.

Well, until he comes clean on why I can't see how/why Scotland can keep the pound. Seems only fair.

Just give us our share of the Bank of England reserves,

Those ARE assets and you can have some of them! 😉

You can't reveal your plan B (sic) and C until you have given them some thought! The millstone that is sterling (how appropriate) is already plan B......so we should be saying plans C and D. I wonder what plan w will look like?