The effects in the UK of the British pound tanking against the USD and its fall against the Euro.

[lol-lol]

My job is within International Trade and trying to minimise the "Landed" cost of those goods that arrive and when they are needed.

About two thirds of UK imports are traded is USDs. 

The fall in the value of the pound against the USD since Thursday 22nd September when two major event happened ie the Bank of England "only" raising rates by half a percent when other major economies went for 0.75% and the Government's Growth Budget announcement in Parliament.  The pound fell 4 cents against the dollar during Thursday and Friday.  The pound has fallen another 3 cents so far today where it currently is 1.055 compared to 1.125 at the start of Thursday 22nd September.    GB Pound also fallen 3% against the Euro last few weeks.

 

Unusually the FTSE100 fell at the same time.  As many FTSE 100 assets are linked to overseas activities a weaker pound usually spurs the FTSE 100 upwards. So what does all these means ???

Possibly-

1. An emergency "October" 2022 Bank of England Rates meeting which will raise UK Base rate another quarter or half percent
2.  UK can use some of the Bank of England Reserves which are predominately in USD... https://tradingeconomics.com/united-kingdom/foreign-exchange-reserves   Graph below....
3. It is looking like the UK is going to experience higher interest rates sooner than previously thought ie maybe 5% Base rate occurring next year
4. High interest rates will so damage finances of millions of UK people buying their homes on mortgages where the fixed interest period is coming to a end soon or they are on SVR already 
5.  House price collapse seems inevitable as circumstances similar to those in early 1990s in the UK where house prices fell by between a quarter and a third in real terms
6. High inflation of the price of imported goods ie food, cars, most electrical goods, diesel fuel.
7. What can be done ?   Hope that next government action restores confidence in the UK market.  

 

UK USD reserves

[SteveTheElder]

We’ll, that’s cheered me up no end  😂

 

Joking aside, I was thinking about the impacts and not looking forward to the next few months. To be honest, I wouldn’t be surprised if all 7 of your ‘possibles’ become reality, well, the fist six anyway.

 

It’s my kids (late 20s/30) and their peers I’m concerned for - echos of 40 years back when my first property lost 10% in value in under three years, thankfully just avoiding negative equity.

[lol-lol]

9 minutes ago, sneal said:

We’ll, that’s cheered me up no end  😂

Joking aside, I was thinking about the impacts and not looking forward to the next few months. To be honest, I wouldn’t be surprised if all 7 of your ‘possibles’ become reality, well, the fist six anyway.

It’s my kids (late 20s/30) and their peers I’m concerned for - echos of 40 years back when my first property lost 10% in value in under three years, thankfully just avoiding negative equity.

 

Financial market predicting as much as 1.5% increase in Bank of England this year !!!!

God help anyone renewing their fixed rate mortgage. I did mine last month and best I could do was to get one at 3.55% and that is compared to my previous 2 year fixed deal at 1.54% ie more than doubled the interest rate element from £100 to more like £220 a month.

 

Octopus energy been great so far but still going up around £100 a month for winter at least. Shopping gone up to and all these business are massively effected by foreign currency as what they supply me is effected by the international exchange rate and BoE interest rate.

 

[@Lee]

Opinion; It's a disaster capitalists and hedge funders wet dream. I'm just glad there's no disaster capitalists or hedge funders in or close to Government and that there was absolutely no possibility of insider knowledge nor that the opaquely funded Tufton St. crowd are doing the advising....

 

From legitimate and reliable news sources;
Oh

Quote

A source who was present at a dinner attended by hedge-fund managers a week ago revealed: “They were all supporters of Truss and every one of them was shorting the pound.” Several made small fortunes on Friday betting against the currency.

Those with longer memories compared the bonanza to the “Barber boom”, named for Ted Heath’s chancellor Anthony Barber, which sent inflation spiralling and put Labour into power again in 1974.

https://www.thetimes.co.uk/article/biscotti-mini-budget-exposes-gulf-between-liz-truss-and-keir-starmer-and-more-tax-cuts-are-on-the-cards-j2mj5zncs

https://www.reuters.com/business/finance/odeys-hedge-fund-soars-145-bets-against-uk-bonds-sources-2022-09-22/
https://www.thetimes.co.uk/article/top-liz-truss-aide-mark-fullbrook-paid-through-his-private-company-b90hdkj5z

Opinion; When's the interest rate rise or the IMF bailout coming. It's just like the old days innit. Sick man of Europe again and set to have the slowest growth in the G7/ G20 apart from Russia.

Edited 26 September, 2022 by @Lee

[lol-lol]

UK Gilts are just moving at lightening speed.

Lenders wanting 4or even 4.5% to lend the UK money now.......

https://www.bloomberg.com/markets/rates-bonds/government-bonds/uk

 

(Times are New York Times not UK times).  

Moving over 4% in a year is as bad as 2008 financial crisis movements !!!! 

Gilt Yields

NAME	COUPON	PRICE	YIELD	1 DAY	1 MONTH	1 YEAR	TIME (EDT)
GTGBP2Y:GOV UK Gilt 2 Year Yield	1.00	94.76	4.43%	+54	+170	+413	7:19 AM
GTGBP5Y:GOV UK Gilt 5 Year Yield	1.25	85.80	4.55%	+51	+201	+398	7:19 AM
GTGBP10Y:GOV UK Gilt 10 Year Yield	4.25	100.89	4.13%	+31	+152	+320	7:19 AM
GTGBP30Y:GOV UK Gilt 30 Year Yield	1.25	49.82	4.30%	+27	+143	+307	7:19 AM

 

[Ootohere]

There has been a major effect. 

 

The man who can has been shut up this morning because of 'The Emperor's new clothes'. Turns out he is the man who has to carry the can.

 

That smug smirk has been wiped right off the face or Kwasi Kwarteng MP who has never been any good in his previous posts in government and regardless of past employment and activities was never the right person to be Chancellor of the Exchequer.

You can write all the books and articles you like and have your beliefs but that does not mean everyone will except your crap decisions. 

 

People are making a killing someplace obviously. 

They might or might not be Tory donors or even members of the government front bench.

 

 

 

 

 

Mark Littlewood.  Spin doctor. Pick a side, get paid, spout your nonsense.

Such a success in business personally, always there with an opinion, even if it is that of those paying him, not that h will tell you who they are.

So in touch with the common people.

http://en.wikipedia.org/wiki/Mark_Littlewood

 

 

 

 

 

 

Edited 26 September, 2022 by roottoot

[Ootohere]

Surely it is not just Labour that should be calling for any investigation.

There are regulatory bodies and Westminster Committees and the Speaker of the House who one might expect to be doing the same.

 

People in Downing street and the Treasury are there and not even Government Employees. 

So many chatty rats about and often they are journalists or employees of Media barons who are also insiders in the politics of a country.

 

http://bbc.co.uk/news/uk-politics-63028710

http://www.ft.com/content/9f85f44c-a7ee-4eae-9202-0a38b06fc236

 

 

 

 

 

Edited 26 September, 2022 by roottoot

[lol-lol]

Trading Economics data site and it chart of the benchmark 10 year UK gilt (bond) ie what interest, compounded, for international lenders to take up the UK debt which signal what UK interest rates are expected to be so that investors get the money back plus return......

 

Interest that Banks and Building Societies using for mortgages north of 7% anyone ? 

 

https://tradingeconomics.com/united-kingdom/government-bond-yield

"The yield on Britain’s ten-year Gilt broke above 4.2% for the first time since 2010 on Monday, as traders ramped up bets on the scale of interest rate hikes by the Bank of England after the pound tumbled to record lows against the USD amid persistent concerns over the government's credibility and uncertainty over how the new mini-budget will be paid. Money markets highly expect an emergency rate increase of 25 bps this week and price in a nearly 150 bps increase by the November meeting. The hiking cycle is now expected to peak in November 2023 at about 6.25%. On Friday, the new government announced a plan to boost growth that would include scrapping the 45p top rate of income tax and replacing it with a 40p rate and a cut in stamp duty on home sales. The UK Debt Management Office said it was raising its debt issuance plans for the current financial year by GBP 72.4 billion, reflecting the funding required for all measures announced by the new finance minister."

[cheezemonkhai]

I can see a post I removed from another thread has made an appearance here.

If this thread turns into a political or tit/tat thread it will be closed down.

[Ootohere]

Sorry if there is anything that can be construed as political or tit for tat.

 

Purely just Conservative & Unionist Government stuff then affecting the UK Economy leading on from a Mini-not budget held last week and an positive effects or adverse ones that might come from that.

 

[@Lee]

Quote

Just for the record, 

 

I can’t see into peoples heads, I don’t know who the people are. 
 

I read things as I see them, and for the political topics that was too much reading for my life clock.

 

I don’t understand comments like this. Even for me it’s too woolly. Say it in a pm or email, or don’t and don’t publically.

 

ref goalpost moving if I think you mean the changing guidance mid topic, that’s fine. From the point of the post onwards. 
change is/ was required to try and reinforce the other nudges. 
 

if you didn’t mean this, welcome to my world trying to read between the lines of personal attritional posting by indirect references. 
 

spoiler I can’t read everyone’s posts from everyone else’s perspectives. I see a pattern, not the detail.

one final clarification as it’s been raised by a few channels, the above post does not ban political chat  

 

more it strongly discourages the tit for tat, proxy postings. And perhaps wise not to test me on it right away. Bears with sore heads and lack of sleep and all.
 

In this I’ve probably left a sword for myself to fall on yet again. What’s tit for tat in ones mind vs another.

 

the spirit is, well it’s above and in the guidelines which date back to 2002.

 

there are no winners from this. I don’t mind an objective slaughter* of external parties just not of each other, hidden or overt.
 

* within legal requirements. You’re responsible/libel for what you post. 

 

https://www.briskoda.net/forums/topic/491170-recent-thread-closures-removals-political-et-al-tit-for-tat/#comments

I don't think there's any tit-for-tat here, We're all on the same page and know where the current problems have arisen from.
 

 

Edited 26 September, 2022 by @Lee

[lol-lol]

Even right wing papers occasionally write an informative article..............(below text in Italic and graph) 

Puts in to number just how many mortgages and families are going to be put through the misery of re-mortgaging for a massively higher cost of servicing their mortgage.

God knows what hell this will cause but I remember the early nineties well when we had not only rising interest rates and mortgage payments but coupled with huge falls in the value of houses and this leading to negative equity and despair. My brother, sister and I all got through it as did millions affected then and we did not forgot how abandoned we felt by government.

 

https://www.express.co.uk/finance/personalfinance/1674476/Mortgage-interest-rates-hike-rise-increase-cost-of-living

 

Data shows hundreds of thousands of Britons on fixed rate mortgages could see their payments soar next year, if interest rates are hiked even further. Figures from research group BuiltPlace indicate that the number of people whose fixed rate term is ending, is set to increase heading into 2023. The chart indicates that the number of people finishing their term is around 300,000 this quarter, and will increase over the next three quarters, peaking at around 375,000 in the second quarter of 2023.

  

 

[Aspman]

Honestly I don't think I've ever seen such an amateurish low brow pig ignorant piece of work from any political party at any time.
Either they are thick as **** or this is deliberate and they are loading gold bars into a private jet right now before heading off to Barbados.

 

Even the Daily Mail is having a hard time spinning this one. It's a two year long suicide note for the Tories and a death sentence for thousands of innocents.
Labour will walk in next GE but are going to inherit a post apocolyptic UK.

It's gobsmackingly brazen, they just don't care how obvious it is that this is only for the rich.

If you are poor you should be rich; if you are old you should just die and free up the housing, if you can't get work you should also just die.

 

Honestly every time you think things can't possibly get worse (Boris), the tories just pull out someone even more unhinged and mental. They'll be promoting the Killing Fields next as an example of how to run a modern democracy.

[skomaz]

Yep - Rishi Sunak may not have been popular amongst the Conservative Party members but at least he had some form of grasp on reality...

 

Liz and co seem to be even more in their own bubble than most politicians to date have been, regardless of party...

[J.R.]

42 minutes ago, Aspman said:

Honestly every time you think things can't possibly get worse (Boris)

 

I have said many times be careful what you wish for.

 

If he were still in power do you believe that he would want to take such moves?

 

Even if he were minded to do you think he would have the support of the party or on a more practical level would Carrie allow him to?

 

You got what you wanted, no point whinging now.

[@Lee]

14 minutes ago, J.R. said:

You got what you wanted, no point whinging now.

Pretty sure Aspman hasn't got what he wanted. Nor did I. Nor did the majority of the UK of GB & NI. The  81,326 people who voted for Liz Truss got what they wanted. 

[lol-lol]

10 minutes ago, @Lee said:

Pretty sure Aspman hasn't got what he wanted. Nor did I. Nor did the majority of the UK of GB & NI. The  81,326 people who voted for Liz Truss got what they wanted. 

 

Some of those 81k Con party members are not even on the British electoral role as you do not have to be to be a member of the Con party incredibly.  

[@Lee]

Oh I see the BBC has finally begun to catch up on what's been common knowledge to those in the know for some time now.
55 Tufton Street. Dodgy a/f
 

Quote

On a rainy afternoon earlier this month, Liz Truss walked through the famous black door of No 10 Downing Street for the first time as prime minister.

But under a mile away, there's another black door that's had a lasting effect on the previous decade in British politics - and looks like being influential under this administration too - No 55 Tufton Street.

The building houses organisations including the TaxPayers' Alliance and the Global Warming Policy Foundation - and is the former home of many others, such as Vote Leave and Brexit Central.

https://www.bbc.com/news/uk-politics-63039558

[skomaz]

14 minutes ago, @Lee said:

Pretty sure Aspman hasn't got what he wanted. Nor did I. Nor did the majority of the UK of GB & NI. The  81,326 people who voted for Liz Truss got what they wanted. 

 

I think you'll find he meant you as in the collective you - as in the UK through the general election process.

 

We all know we, as in the collective we, other than the 81,326 you mention, didn't get a say in Liz Truss becoming PM - so no need to take things as a comment re you personally and repeat what we already know ad nauseum.

 

Having said that he does have a very valid point about posters who wanted Boris out - look what we've got now as a result!!!

Edited 27 September, 2022 by skomaz

[Carlston]

The Pound has done rather well against both the Euro and the Japanese Yen over the past 5 years, even taking into account the current trading rates.

 

Take a look at the 5 year graphs on google finance for GBP/EUR and GBP/JPY (click the "Currencies" button)

https://www.google.com/finance

 

Edited 27 September, 2022 by Carlston

[Ootohere]

There will need to be an investigation into Elected Members of the Government and non elected ones from the other house and any possible Insider Trading.

 

Maybe from Business's they are partners in but are currently taking a rest from being involved,

or from partners / spouse / lovers / family members who are in various financial service businesses and  employed in major banking and investment companies. 

 

There are quite a few of those in the Cabinet. 

 

Elected members, PM's, Chancellors, Business Secretaries, & Treasury Ministers with Husbands & Wives and who knows who in Banking, Accounting, Hedge funds,  as well as Civil Servants and Special Advisers with the same. 

Loose lips among those in a culture of drinking, and maybe a bit of messing about might not cost lives,

just lose others their savings and investments.

Edited 27 September, 2022 by roottoot

[lol-lol]

14 minutes ago, Carlston said:

The Pound has done rather well against both the Euro and the Japanese Yen over the past 5 years, even taking into account the current trading rates. The US Dollar acts as the world's reserve currency and hence is overvalued at the moment due to the nervous "sheep" who operate the financial markets.

 

Take a look at the 5 year graphs on google finance for GBP/EUR and GBP/JPY (click the "Currencies" button)

https://www.google.com/finance

 

 

 

Pound was quite strong before the BREXIT vote which was 5 years and 3 months, since then, not so much.

 

As for the Japanese yen, the pound did buy well over 200 yen before the financial crisis, now it is about 155, makes a big difference when buying a Nissan GTR or big Jap bike.

 

[J.R.]

24 minutes ago, skomaz said:

 

I think you'll find he meant you as in the collective you - as in the UK through the general election process.

 

We all know we, as in the collective we, other than the 81,326 you mention, didn't get a say in Liz Truss becoming PM - so no need to take things as a comment re you personally and repeat what we already know ad nauseum.

 

Having said that he does have a very valid point about posters who wanted Boris out - look what we've got now as a result!!!

I actually typed "you all ..." but then corrected it as someone may have said "I didn't!"

 

If anyone were to have taken the "you" as meaning them it should have been Aspman and not Lee, from his comments I would guess he wanted Boris out but maybe not, the "you" as you correctly surmise was a collective "you" and referred to wanting Boris out, that should have been obvious to anyone from the quoted text.

[Ootohere]

@Aspman might well tell you if you ask.

 

He would be on the electoral roll giving a vote in the UK General Election, the Holyrood Election, the EU Referendum, the Independence Referendum and the Council Elections.

As i get. 

Lots of votes and that might get me what i want and certainly gets me what i do not want as an outcome.

 

 

[@Lee]

Bloomberg reporting that UK markets have lost at least $500 billion in combined value since Liz Truss took over as Prime Minister.
That's about $23.8 billion a day. Nice going.
https://www.bloomberg.com/news/articles/2022-09-27/uk-markets-have-lost-500-billion-since-truss-took-over?utm_campaign=socialflow-organic&utm_content=bloomberguk&utm_source=twitter&utm_medium=social&cmpid%3D=socialflow-twitter-bloomberguk

Opinion; If there's been insider knowledge given to hedge funders betting against the pound (shorting it) then there should be prosecutions for those doing the shorting and those giving the information of what Government had planned beforehand. There might even be a word for those sort of people.