posted on Feb, 20 2013 @ 07:05 AM
Did you know that the pound has lost about 20% of it value since 2008?
I didn't till a few days ago and might go some way to explain utility going up
but im getting a little feeling that there are plans to go further.
The pound took a fresh beating yesterday as concerns of currency wars and debasement of sterling led to another sell-off and experts
said the currency was at risk of a "large-scale devaluation".
Sterling trails only Japan's yen as the worst performer against a basket of international currencies this year as a 4.5 per cent decline fuels import
prices and pushes up the cost of food, insurance and other necessities for hundreds of thousands of households. As central banks tolerate higher
levels of inflation, the pound is set to weaken further across the board particularly against safe haven gold.
UBS warned that the pound seems clearly at risk of following the yen and "suffering the next large-scale devaluation."
Dealers also noted weekend comments from Bank of England rate-setter Martin Weale, who warned the pound was still too high to help the UK economy
rebalance effectively. The continued pressure on the currency comes after its biggest weekly loss since June last year amid gloom over weak growth
The Bank of England has signalled it is willing to tolerate higher inflation for longer, while the pound's safe-haven appeal has also waned as the
European Central Bank makes explicit commitments to prop up Eurozone strugglers and preserve the single currency.
So what makes me think there a plan to devalue further you ask well take a look at this
report on bloomberg from last year.
In the U.K., which -- unlike Greece -- isn’t part of the euro area and can devalue if it wishes, there’s growing pressure to do
so. A letter recently circulated to some 3,000 influential figures proposed deliberately weakening the British pound to boost exports and hence
economic growth. Debasing currencies in this way is promoted as an alternative to sovereign default, as well as to other methods of increasing
competitiveness, such as cutting nominal wages.
It's intersting to see that all these 3,000 influential figures (whoever they my be) only
seem to be thinking about exports not the public who will suffer higher utility bills
from importing oil and gas from russia.
With both japanese yen
both devaluing they currancy it look
like the race to the bottom is on.
edit on 20/2/2013 by skuly because:
adding a link which i forgot to do sorry