GBP crash: does that mean the world thought it was a bad idea?

[loonymoony]

Title says it all really.

I'm genuinely concerned (my vote was remain).

Would the GBP have risen if the vote had been to stay? (I guess no one can say for sure)

I feel profoundly sorry for all those in the European Parliament who put up with Farage all these years. At least there's a big silver lining for them that they no longer have to be professional with our lot.

I think the EU could be finished

It is.

We will probably form a new Hanseatic style deal.

The poor EU countries will be cut lose

The Balkans etc will probably attempt to reform an Austro-Hungarian empire.

These blocs can all come together to cooperate - without political union.

Much better than having an EU superstate with its own EU army

Christ Springing are you trying to send ice down our spines.

Sounds like a recipe for a new Thirty Years' War. Or the Hundred Years' War, take your pick.

The Balkans etc will probably attempt to reform an Austro-Hungarian empire.

Um, no. That's about as likely as say, India, begging to become a part of reformed British Empire.

I do recall President Obama saying the UK would be at the back of any trade deal after a leave vote. That would be a fine reason for the pound crash in the events. Of course, the leave camp freaked out and said they didn't like being lectured to uppity Americans and they'd show him

Yes, but people had been warning us for months.
When your only support is Trump, Putin and Le Pen you can be pretty sure you've fucked up big time.

Yes. As anyone working in the City will tell you the City has been preparing for this for years. As soon as Article 50 is triggered they will get into action. Lawyers for instance will need to qualify via Dublin (simple paperwork) but if the City of London loses its EU passport as a result of Article 50 being triggered, then they will relocate to Dublin/Paris.

The triggering of Article 50 is key. The markets are bad as is the currency but everyone is waiting for the next step. The problem is this: we could negotiate to stay in the single market but we have to allow freedom of movement.

So the choice if you are Leave is either financial catastrophe post Article 50 or going back on uncontrolled immigration to secure entry to a common market (and stabilise the economy/currency).

OP it was a very large - really exceptionally, historically large - fall in sterling, from which you can conclude that investors think brexit is a terrible idea.

Markets hate uncertainty, so what we saw on Friday was partly due to a flight to "safe havens" ie gold and the US dollar, but the pound lost much more than other currencies because brexit is seen as more negative for the UK than for other economies.

no it means that the markets 'thought' the vote would go the other way, they had to call it one way or the other and they bet on remain

Incidentally (work hat on) sterling is down another couple of percent in Asian trading tonight, and the FTSE is likely to open down again tomorrow. This is not all over yet.

Much better than having an EU superstate with its own EU army

yes, and that is the long term plan, a superstate ruled over by one government and run largely in the interests of large corporations, hence 'TTIP'

I do recall President Obama saying the UK would be at the back of any trade deal after a leave vote

ah c'mon, he was told to say that, you notice that after the leave vote he told us that we're still special
www.express.co.uk/news/world/683118/EU-referendum-President-Barack-Obama-Brexit-leave-remain-out-special-relationship

'He said: "The people of the United Kingdom have spoken, and we respect their decision. The special relationship between the United States and the United Kingdom is enduring, and the United Kingdom's membership in Nato remains a vital cornerstone of US foreign, security and economic policy'

Americans are not in favour of 'big government'
they respect us for standing up for our independence

That was the first drop. You are being a bit naive if you think that in 10 days time all this will blow over and life on the stock exchange will go back to normal. After all the principal reason Article 50 hasn't been triggered is because Leave realises how catastrophic it will be economically. If you think banks and financial institutions haven't been making Brexit contingency plans (which involve redundancies and relocations) then you are also being a tad naive.

In Barack Obama's world being special meant not paying much attention to Britain or David Cameron at all. If you like being patronised post referendum then that's what those words are. But if you think the UK will strike a BETTER deal with the US outside the EU then most US trade negotiatiors would laugh you out of the room.

And oh your friend Trump? He wants to dismantle NATO...

Somewhere Putin is having a big old laugh.

And oh your friend Trump
if you are addressing me then please note that I have made no mention of or reference to Trump

OP - err, yes. The whole bloody world and most people in it.

No. There will always be a period of uncertainty with any big world event like this and the pound dropping is a response to that. The plus of the pound being lower is that it good for our exports as they are cheaper for other countries to buy so it boosts manufacturing. In fact it is not that low compared to where it has been previously

Economic forecasts are made using assumptions of what you the economist thinks will happen so, if you had 100 economists forecasting something like Brexit where the future is totally unknown, you would get 100 different answers and none of them would be definitive. In a normal situation you can narrow down the likely options but here we can't and this is the markets reacting to that uncertainty.

Of course there are risks of leaving but there are risks of staying too. I am old enough to remember Black Wednesday in 1992 when interest rates rose from 10% in the morning to 15% by afternoon. People genuinely thought they would lose their homes and businesses and were almost shellshocked by it but then we pulled out of the ERM and rates fell back to 12%. Then there was a panic rather like now of "Are we doing the right thing?" or will be left behind as we will not be in the Euro. That turned out to be a very good move for the UK and I think this will be the same.

The exchange rate is a kind of barometer showing how investors around the world view the UK.

In the run up to the result, it was clear that investors favoured the stability of Remain as Sterling went up whenever polls were published indicating an In vote. The reaction to an Out vote shows that the world thinks it's an economically bad idea.

How long will it last? Until there is more certainty about what the plan is and how it will work. Most economists predict the UK will be economically worse off out of the EU, so I expect the pound to be low for some time.

It would have been much better timing to hold the referendum at the end of summer after people return from foreign holidays!

And it's tanking in the early Asian trading. Will be interesting to see what the day brings. I feel a little bad for finding this whole fiasco so fascinating.