Purbeck Island, Dorset to accept Euro 1 to 1 with the pound

Read the report from Swanage linked here. AND SO IT BEGINS!

Is Britain's Quantatitive Easing an exit strategy from the EU?

Incompetent British Governments in succession have sold out their country to the Continentals and in the process signed up to a yearly and ever rising membership fee to a 'zero-return Club' most recently it seems has been solely to purchase ex-PM Tony Blair an aprés Lisbon Treaty EU Presidency slot. The FT today reports that some in the ECB suspect Britain's 25 per cent devaluation of its sterling currency in the past few months might have been made to gain a competitive advantage over their EU trading rivals, read here. My headline to this post has a much more intriguing question. Given the manipulation of the Euro/Sterling exchange rate at the end of last year (about which unsustainable costs I blogged at the time) and considering the impossibility of having the 27 member states instruct the EU Commission to drastically cut the absurd costs and waste of the EU "Could it be that the printing of huge quantities of worthless money to pay our EU bills is perhaps the only way out of what has become an economic dead end for the Country?" My view is that the answer is probably no, for that would require some competent management and gutsy politicians, both of which are presently lacking. Our money still seems to be being trashed for absolutely nothing! Trading advantage from a devalued pound is practically worthless as our manufacturing base has been destroyed due to unbelievable mismanagement and EU membership, while consequent more steeply rising EU contributions become ever more burdensome due to the declining exchange rate which is bound to continue as the printing presses relentlessly churn. Our debts to the EU are calculated in Euros! Those paid and pensioned by the UK State, who presently see themselves as the beneficiaries of Zimbabwe style economics, should glance at the Pension Cut announced by AON for 5000 private sector employees today and wonder whether they really wish to continue to exploit their fellow citizens in this crazy manner!

British inflation rises to 3.2% on CPI

Trash your currency, give the nation's assets to the EU and transfer billions to that same corrupt organisation each year and any country would be bound for disaster. When Maggie Thatcher made here "No!No!No!" speech Britain was self-sufficient in food and energy - the essentials of life - and had a healthy manufacturing industry - remember the Central Electricity Generating Board, British Gas etc., no EDF or Eon back then gouging every citizen to mind-numbing poverty! Thatcher was dumped by the treacherous likes of Heseltine and Ken Clarke who today still hold the levers of Tory power, and the unexpectedly high inflation figures just announced come from the pounded pound and according to The Times all due to HIGH FOOD PRICES most now coming from the EU because we have ,of course, sold out our farmers as well! The three main parties have betrayed Britain and sold it off to the EU to fill their own pockets - Make them pay the price on 4th June!!!!

Lloyds! Do any in England now believe they live in a Democracy

The Independent this morning, linked here, reports that a trillion dollars worth of foreign funds were withdrawn from the City of London between the spring and the end of of last year and that the run could now become a rout of confidence. It also has the following: This week, Lloyds became the latest bank to approach the Government for more assistance. A deal was agreed last night for the Government to insure about £260bn of assets in return for a stake of up to 75 per cent in the bank. The slide in sterling – it has shed a quarter of its value since mid-2007 – has been both cause and effect of the run on London, seemingly becoming a self-fulfilling phenomenon. The danger is that the heavy depreciation of the pound could become a rout if confidence completely evaporates. Why has this act of destruction against a viable bank been perpetrated by the Government with no calling to account. On 18th September last year, when the merger was first leaked I blogged (here) as follows: If the problem is mistrust by bankers of one another, absorbtion of one bank by another will surely merely shift the target of others mistrust.... If the takeover of Abbey National by Lloyds a while back was halted as not in the public interest how come the takeover of HBOS by Lloyds is justified in the public interest?... Re-establishing trust in Scotland would surely be best attained by separating the old Bank of Scotland from the Halifax disaster area... Now it is being announced on the BBC that Lloyds has become a government subsidiary. The shareholders have had their assets effectively stolen, although foolishly all along the way they kowtowed to the Government's demands, but under what pressure by the Government upon the larger institutional investors who alone could have swung the act of plunder! Can higher prescription charges only be applied in one part of a Democracy? Can the Government steal your bank? The answer to both questions should be No. Yet it is happening.... Can England still be a democracy?? How can the answer possibly be Yes even had legislative power not been passed to the EU? Why has the Opposition throughout this period not Opposed? (Update 0921 GMT the Government stake in Lloyds is now reported by Sky as 77%, another 2% loss over breakfast for the shareholders since The Independent went to press. What a Farce!) (Update at midday - at least one other commentator agrees on this, read here but Gerald Warner in his Telegraph blog is forced to ask in the title "Is it just me?" Just us it seems - unbelievably the Conservative Home blog is debating as its main topic whether the Tories are still right wing!!)

Treasures from the threads -number twenty-nine

From a comment to Simon Heffer's well-stated column in this morning's Daily Telegraph, linked here:

emmiem

on January 10, 2009

at 08:14 AM

.....The banks have lost their capital with massive write-downs, are basically insolvent and have no idea what their liabilities might be due to the impossibility of pricing the monstrous pile of toxic derivative securities, CDO's, MBS, etc, sliced, diced then repackaged and traded with abandon in the heyday of perpetually expanding bubbles. Most of them ended up with European banks. The BIS (Bank for International Settlements), estimates the total might be $1.6 quadrillion with an optimistic firesale value of pennies on the dollar/pound.. if any buyers can be found. A security is only worth what a buyer is prepared to pay, hence the difficulty in estimating value. Brown is not that much interested in savings or diminishing capital for private investors. Our fiat financial system is totally reliant on ever expanding infinite debt as evidenced by the need for year on year exponentially increasing GDP. To re-inflate the bubble he must get banks to lend so that we are persuaded to take on more debt in order to consume more goods from businesses that are themselves in debt. (Blog editor's emphasis) How he will achieve this I do not know. He may in the end have to resort to creating the debt on our behalf in the form of a huge national public works program which will boost yet more publicly funded jobs but do zilch for the economy. Or he may have to nationalize the entire housing stock by buying up all mortgages, in which case he will bankrupt the country. Whatever he decides at some point he will have to concede that our fiat currency is well beyond its sell by date and we are witnessing its death throes. I see a new currency on the horizon (world currency?), or a global return to the gold standard with a coordinated devaluation of all currencies. I also have a nasty feeling this entire financial fandango was deliberately engineered.

UK enters whirlpool towards hyper-inflation

Like a leaf floating across whirling rapids, sterling has now entered the outer edges of a whirlpool which can seemingly inevitably only sweep it round and round and down and down to the inevitable end of a Zimbabwean hyperinflation..... The Bank of England MPC reduced interest rates today by a further suicidal half percentage point to an all time 400 year record low of 1.5 per cent!

German Bond Sale Failure

If the following does not stop the suicidal Monetary Policy Committee of the Bank of England from a further pointless cut in Sterling interest rates then nothing will: German bond sale’s failure signals trouble ahead A German sovereign bond auction failed on Wednesday as investors shunned one of the most liquid and safe assets in the world in a warning for governments seeking to raise record amounts of debt to stimulate slowing economies. The fate of the first eurozone bond auction of 2009 signals trouble ahead as governments around the world hope to issue an estimated $3,000bn in debt this year, three times more than in 2008. The 10-year bonds failed to attract enough bids to reach the €6bn the German government wanted. Bids of €5.24bn, a cover of only 87 per cent, amounted to... Read more from this link. Also from the same source you may read the continuation of an article that begins as follows: In terms of debt dynamics, the UK is by far the worst of the 'AAA' club of countries. The underlying fiscal picture is terrrible,' said Brian Coulton, head of sovereign rates at the credit agency.Mr Coulton said it would become increasingly hard for ...

Was the pound/euro year end trough contrived?

There was an intriguing quote (HT Eureferendum blog) at the end of the link included in my post of last Sunday titled "Britain will be unable to meet EU payments" as follows: A Treasury spokesman declined to comment on the impact of exchange rates, pointing out they could go up and down. He confirmed the rate used for EU contributions was always fixed at the end of the previous year. The contributions referred to are of course Britain's to the EU. Now we are into the New Year an interesting pound/euro rebound seems to be taking place, this quote is from the Belfast Telegraph half an hour ago: The pound rose as much as 3.4% to 92.51 pence per euro, strengthening to less than 93 pence for the first time since December 22. The pound traded at 92.80 pence last night from 95.69 on Friday. Surely our so-called partners in the EU (aided by the so-called experts on the Bank of England Monetary Policy Committee at the 7th November 2008 meeting) could not have manipulated the markets to maximise EU receipts? This blog will follow exchange rate developments with interest! Meantime how is Britain now to pay, surely the task will not be made easier by another interest rate cut on Thursday leading to further sterling devaluation - if no cut comes then was not the 7th November 1.5 per cent slashing (which has had zero positive effects on the economy) dreadfully politically timed considering the hundreds of millions of pounds impact on Britain's payments to the worthless and corrupted EU? Especially as Britain is now locked into that rate throughout 2009 regardless of the disasters which may yet befall the euro currency? Who removed political considerations from monetary policy? None other, of course, than the deranged occupant of Number 10 Downing Street - the Prime Slime! Did the worthless MPC consider exchange rate impacts on 7th November? Who is responsible now that the Government has delegated governance to academic amateurs whose own motives have never been assessed by any electorate? Why have the opposition parties not queried these aspects and recent disturbing events? These matters must be aired before Thursday!

Britain doomed if Bank cuts rates again

On November 7 after the Bank of England cut interest rates by 1.5 per cent the heading of this blog's posting that day correctly predicted STERLING DOOMED read it from this link. It went on to include this comment: An incompetent if not insane MPC of the Bank of England has today thrown sterling to the dogs! Earlier that day and ahead of the announcement I had spelled out the consequences in more detail, link here. NEEDLESS TO SAY THE SUBSEQUENT COLLAPSE OF STERLING HAS PROVED MY DIRE PREDICTIONS ENTIRELY CORRECT. Amazingly the MPC of the Bank of England, egged on by a completely deranged Government and ruling establishment now clearly in full panic mode worsened by their own arrogance and complete lack of proper life experience , are now preparing further cuts as reported in The Times this morning, linked here. This painful certainty of chaos following further cuts, almost bound to lead to the nation's economic destruction lasting many years, was blithely ignored by the leader of the Opposition, David Cameron, in a live interview on the BBC Radio 4 Today programme this morning, so of hope or alternatives there now remain NONE. WHAT benefits came from the November slashing of rates other than to destroy prudent savers? NONE WHATEVER! Why cut again when the benefits are illusory? The inflationary consequence of Sterling's collapse have yet to be felt but as an example let me point out this fact - if sterling next falls to near parity with the dollar (it last nearly reached such parity following Sunny Jim Callaghan's disastrous socialist premiership) and the oil price rallies to about 75 dollars a barrel, then oil costs in Sterling will be higher than at the last peak of $147 experienced last summer!! More Sterling interest rate cuts this week from the MPC will result in total British economic collapse.

UK Exports fall despite collapsing Pound

The following is a quote from Euronomics linked here: ...in the U.K., exports fell by 3.5%, and in Germany exports fell by a more modest 0.5%.

U.K. exports declined despite the pound's rapid decline in value against other major currencies. Against the euro, it has fallen to an all time low of GBP0.8737 Monday from an average of GBP0.80 in mid-July.

"Slowing global growth outweighed the beneficial impact of the weaker pound," said Howard Archer, chief U.K. and European economist for IHS Global Insight.

Even Irwin Stelzer, Rupert Murdoch's guru, has now turned on the demented and ignorant Gordon Brown in the Daily Telegraph, here. As Woolies is about to close, the pound continues to plunge and even our EU partners stand amazed and outspoken at the Government's incompetence..... surely UK citizens will now awake and take steps to rid themselves of the cause of their growing miseries?

UK Interest rates must rise

What can stop sterlings continuing plunge which threatens the wealth of all the country's citizens? This blog has been arguing for austerity and interest rate rises - it is the only cure after all these years of profligacy (why wait for the IMF to insist, further delay risks even they will lack the funds to help). A Telegraph report on the pound's fall to 87.79 pence per Euro concludes: "If the pound falls too far, it could frustrate future interest rate cuts because it would push up the price of imports and stop inflation coming down," said Steve Barrow, a currency expert at Standard Bank. (The idiot Chancellor A****** Darling is presently proving his incompetence to a Commons Committee live on Bloomberg, he clearly has no clue of the disaster he has helped create).

Pounds crash gains momentum ahead of BoE rate decision

Hang on here we go again. The simpletons running UK Ltd have yet to twig that all they do has the reverse effect to that intended. If a large sterling interest rate cut arrives at noon GMT today, the plunge in sterling risks becoming a rout and the necessary rate increases to follow will need to be ever higher. The house price slide underlying these momentous market moves continues to gather steam as reported in the Halifax index today, read here.

One and a half per cent cut - Sterling doomed!

An incompetent if not insane MPC of the Bank of England has today thrown sterling to the dogs! A record one and a half per cent cut could mean future rises towards the 20 per cent levels if not hyper inflation to follow. A deep depression seems certain. The Government has now no chance to honour the recent huge spending commitments it has made. Send for the IMF!

Hungary facing default

In a report on the financial crisis in Hungary (remember an existing EU member) the Guardian reports Prime Minister Ferenc Gyurcsany as follows:

"The goal is to provide Hungary with a protective shield, so we have access to financial resources and even in the most extreme situation we are not facing the threat of a default... We expect a final deal in the coming day or two," he added.

The European Union (EU) is preparing a financial aid plan for Hungary, the European Commission said, but it did not make clear whether its scheme would be part of a package agreed in principle between Budapest and the IMF or come on the top of it.

IMF CONDITIONS

"The IMF had two reasonable conditions. One: plan a budget in which even in the most pessimistic case, you plan spending which you have funds for. Two: in a situation like this, don't commit to reducing revenue," The IMF conditions will be of interest for the UK. Although with Prime Minister Gordon Brown's proven incompetence and idiocy, he will probably defer seeking IMF aid until after the time that their limited funds are exhausted, he should nevertheless abandon his ludicrous plans to further increase borrowing which the UK can no longer afford and follow the IMF guidelines above. At present Brown is expecting the independent Bank of England to reduce UK interest rates while the government itself plans huge new borrowings which could only be achieved with massively raised interest rates to compensate for the daily more severe sterling currency devaluation risks. In the absence of any real political opposition party it is now increasingly difficult to see any way for the UK to escape from the equivalent of an economic Armageddon. I guess that is essentially what the Bank of England was trying to state, in somewhat less alarmist terms, in its survey released this morning. Meantime, Iceland has raised interest rates to 18 per cent, see AFP report here, and requested urgent help from the US Federal Reserve and the EU"s ECB.