2141 replies to this topic

[Rosssco]

Meh. I expected a critique no matter what option i picked.

 

Don't worry, likewise, I didn't expect a response..

[Rosssco]

Or are you planning on "doing a Greece" ? that makes sense

 

Doing an "Ireland" is more likely than a Greece..

[Rosssco]

Saying all that, maybe I'll vote Yes after all...

 

http://www.bbc.co.uk...litics-28673113

[LY_Scott]

Boris might make me leave this island entirely. Utter buffoon. Interesting take on the currency union issue. What's your thoughts Ross?

The truth is that Sterling hasn't crashed because it still, presently very substantially, benefits from Scottish exports contributing to the UK's overall balance of payments. Upon Scottish indy and if iScotland withdrew from the Sterling Zone then Scotland's exports will no longer contribute to the rUK's balance of payments, resulting in the rUK BoP deficit doubling from around 5% to around 10% of GDP. It is for this reason and to protect against capital flight from the Sterling Zone the the BoE will be a Lender of Last Resort to iScotland. Here, rUK would continue to benefit from the Sterling Zone with Scottish Exports, as she presently does. However, without Scottish Sterling Zone exports, an overnight doubling, after 25th March 2016, of the rUK's BoP deficit would be catastrophic for sterling's value and, in all likelihood there would be a run on the pound as the money markets attempt to dump Sterling. The run would only exacerbate international downward pressure on the pound, too much Sterling sold floating around the international and domestic money markets, upsetting the pounds exchange rate. The £ value would suffer and with it the BofP of which the value of the pound is the exchange mechanism in imports/exports. That's why, and one of the reasons of, the sensible 18 month time gap between YES and actual Indy. This is so rUK adjusts to losing 10% of its economy, its new debt ratio of 115% of GDP, at the sametime keeping Scottish exports in the Sterling Zone with a £CU as part of the pounds' BoP with other countries. In short, Scottish exports are required by the pound and crucial to its value pounds' "balance" of payments. However if it continued to reject a currency union (which Westminster won't) beyond 03 2016, and did not sort a deal rUK will attempt to mitigate the dumping of the Pound by the international market in a crisis. This would be catastrophic for economic growth in across the Sterling Zone. To mitigate, rUK Treasury will hike interest rates ACROSS THE ZONE but only taking pounds from the domestic financial markets in an attempt to stabilise the £, but it will fail just as it failed during the infamous Black Wednesday. It would not stop international investors selling the pound, known as "shorting" the market. In short, the pound desperately needs Scottish exports to help keep down the BoP deficit. This is why BoE, said LoLR to iScotland. This was to reassure investors and the money markets, so to prevent capital flight. Also, after YES she will negotiate its fair share of the UK debt (minus assets). This debt will be repaid to the UK Treasury, NOT to the money markets. It is inconceivable that the rUK would wish that debt to be paid back in anything other than the pound Sterling thereby, ipso facto, bringing about a currency union. Practically the rUK cant of course, reject a Sterling Zone. If it does that then it will be blowing HUGE holes in its feet. I suspect, however, upon a YES result in the indy referendum common sense, will prevail and a pragmatic solution will be sought. Just as described by Nic Watt who interviewed the a government minister: The solution is a Sterling Zone. It's every bit beneficial to the rUK as it is to iScotland.

[Harry Hornet]

Mrs H senior says easiest way to solve this problem of Yes or NO, is to cut SCotland off, float it out to middle of Atlantic, and sink it....issue solved...

[LY_Scott]

That's helpful....

[slindborg]

Mrs H senior says easiest way to solve this problem of Yes or NO, is to cut SCotland off, float it out to middle of Atlantic, and sink it....issue solved...

 

do the same for Wales and France too

[LY_Scott]

Do you mean Kent Stu?

[slindborg]

Do you mean Kent Stu?

 

Good point, that bit too

 

Also float Cornwall off a bit, but dont sink it as I like it there It can be like the IoM / IoW

[Rosssco]

Yep, the balance of payments argument has been used many times, as has the potential devaluation of Sterling, and lack of oil (or a significant reduction) as part of the mix.

 

But that's only part of the story, the other being political and future prospects for the currency. Politically, there will be significnant pressure on the rUK government (from its electorate) to reject a currency union on the basis of avoiding a Eurozone-style issue where the value of Sterling is damaged by the conduct of a smaller member. Scotland looks to be heading down a relatively unchecked, socialist spending approach, which in the event of a currency union could damage Sterling's prospects anyway, and ultimately produce negative effects on rUK (now a foreign country).

 

Just to add, currency, and control over it is one (if not the most) important fiscal controls a country has, and a situation or reasona would have to be significant to allow a country to cede it, partially or otherwise.

 

In order to avoid this therefore, in the event of a formalised currency union, there would have to be strict rules on borrowing, debt levels and spending plans. That's not really independance. It may suit politically, to be the least scary option for the SNP to peddle, but at the same time it sort of contradicts the calls for "fiscal levers" that can be used to change Scotland. In whcih case I argue, a devolved or federalised system would be preferencial.

 

A view I found interesting : http://edinburgheye....-no/#more-14811

 

Perhaps part of the reason many want Scotland to remain part of the UK, is that it avoids these difficult and potentially very expensive (for both Scotland and rUK) issues entirely, as the risks / challenges (of this and others) are not worth what's being offered.

Edited by Rosssco, 06 August 2014 - 01:34 PM.

[Rosssco]

Picard says "Don't make it so.."

 

http://www.huffingto...l?utm_hp_ref=tw

 

 

[LY_Scott]

Seen that stuff Heavy cringe. Loving the burn from 32:26 The silence speaks volumes.

[G-Bob]

oooooo.... tom daley says no.  

[Rosssco]

Loving the burn from 32:26 The silence speaks volumes.

What happens at 32:26, and why does it speak volumes? He just says the same stuff that he said the other night, which nobody has ever argued against. No other members are going to contradict this openly, as the propaganda machine will swing into action with accusations of negativity, talking Scotland down etc. etc. Define successful? More or less successful than in the UK is the question. I'd say slightly less successful overall (predictably) and you'd say more, so really he's saying nothing new here..

[LY_Scott]

Well done Ross. You've just made a much better argument than eyebrows did when posed with the same issue Anything on the promised additional powers?

[Harry Hornet]

Isn't all of this a load of bollocks Yes or no Scotland is stuffed anyway and they still have crappie goalkeepers

[KurtVerbose]

Loving the burn from 32:26 The silence speaks volumes.

 

30 seconds of my life I won't get back. Didn't notice a burn or a silence.

 

Why do you keep posting these very long videos that only people wearing a braveheart costume would watch?  

[Rosssco]

The additional powers will depend on what political party wins the next general election IIRC.. I've seen a list somewhere with proposed powers. The main UK parties should set something in stone though to provide more assurance to those who are tempted to vote No but aren't convinced as to what we will receive. Of course there are already additional powers in the Scotland Act 2012. Whether these will satisfy enough people remains to be seen. I'd like to see limited control over tax policy, and perhaps more control over some aspects of benefits. We'd effectively be semi-federalised at that stage..

[LY_Scott]

Kurt, nobody is forcing you to read or reply to any of this. Needless post. Harry....you seem to be forgetting Craig Gordon. All fair points Ross.

[KurtVerbose]

Kurt, nobody is forcing you to read or reply to any of this. Needless post.

 

Well I am quite interested in the debate, and I'm more open minded to it than you probably think I am. I thought you were posting something interesting but either I missed it or it just wasn't. Most of the stuff you do post is interesting, even if I don't necessarily agree with it.