pound has dropped so much, arent you guys worried?

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    (Original post by samantham999)
    Erm I don't think so. Bitcoins are **** and their value is decreasing over time
    True, bitcoins were the hype a year ago or two if i remember correctly, don't see it in the news anymore and things - from what I know they are best used for buying drugs and guns off the dark web ahah

    Edit: just checked to confirm, bitcoin did extremely well for 1 bitcoin = almost $1200 back in 2013, but has gone down approx $300 in march 2015, so against dollars its not doing too well.

    However against GDP it HAS gone up considerably around the time of the Brexit vote to £500 for 1 bitcoin from under £250 in 2015 but I think this is just because of people rushing to get this in case, will likely stabilise over time but we will see!
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    (Original post by Trapz99)
    No it's fine,won't have a huge impact on prices. Good for British exporters
    Actually the bit about being good for British exporters is very unlikely, the British (I was about to say we but I'm not British, just an immigrant uknoe ) export mainly hi-tech, pharmaceutical, nuclear related things - my points is mainly expensive, technically luxury goods which, with a relatively small decrease in export prices, relative to how much most of these products cost the consumers I doubt a small decrease in price for them will tend to make them buy more, the UK tends to focus more on quality and service, non price factors as the goods/services we export are more price AND income inelastic compared to say China which have manufactured goods which tend to be cheaper than what the UK exports.

    I potentially think in the long term there could be a negative effect for the UK in terms of cost-push inflation, as firms import most of their raw materials/production goods meaning their costs rise, leading to a POSSIBLE (idk obviously) rise in prices consumers pay.
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    (Original post by novaDRGN)
    If it's any consolation to you, Lord King (Former Bank of England Governor) said that the lower pound is a "welcome change". Speaking from New York, where he's currently teaching.
    haha banter mate
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    (Original post by azizadil1998)
    True, bitcoins were the hype a year ago or two if i remember correctly, don't see it in the news anymore and things - from what I know they are best used for buying drugs and guns off the dark web ahah

    Edit: just checked to confirm, bitcoin did extremely well for 1 bitcoin = almost $1200 back in 2013, but has gone down approx $300 in march 2015, so against dollars its not doing too well.

    However against GDP it HAS gone up considerably around the time of the Brexit vote to £500 for 1 bitcoin from under £250 in 2015 but I think this is just because of people rushing to get this in case, will likely stabilise over time but we will see!
    Nearly every currency went up against sterling during brexit, bitcoin has no future it was just a hype digital currency the market reacted to. It was great back then but not because it had a future, it was just a hot trade to execute against. What matters most is how the value of BTC-e fell drastically so no one trades it anymore.
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    (Original post by samantham999)
    Nearly every currency went up against sterling during brexit, bitcoin has no future it was just a hype digital currency the market reacted to. It was great back then but not because it had a future, it was just a hot trade to execute against. What matters most is how the value of BTC-e fell drastically so no one trades it anymore.
    Yep completely agree.
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    Americans are so lucky, the entire world revolves around them and their currency.
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    (Original post by Trapz99)
    No it's fine,won't have a huge impact on prices. Good for British exporters
    and bad for imports - how does this work out ?

    you should have a look at the Marshall-Lerner condition https://en.wikipedia.org/wiki/Marsha...rner_condition

    best
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    (Original post by mariachi)
    and bad for imports - how does this work out ?

    you should have a look at the Marshall-Lerner condition https://en.wikipedia.org/wiki/Marsha...rner_condition

    best
    Marshall Lerner is more short term/long term elasticity but they key here is how it will affect british exporters due to what they actually export (which as i said previously is high quality/expensive, relatively inelastic goods/services). I think if there will be an effect on imported goods prices or a small exporting competitive advantage it will come in a few years, depends how long "Long term" takes to kick in.
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    (Original post by Reue)
    Couldnt care less, the increased value of my investments has more than covered the falling pound value.

    Regardless; having a weak pound isn't necessarily a bad thing.
    I had a lot of brexiter friends who said it's gonna be alright .😢

    What did you invest in if you are not uncomfortable that I asked?
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    (Original post by azizadil1998)
    Don't think anyone did tbh!! People either listened to politicians which is possibly the worst idea ever imaginable considering some of the b.s. they go on about some times... Or they just went from their narrow thinking about immigrants or thinking the EU is some sort of hellish place, not sure why! But I think if people thought about it logically and some knowledge of idk Economics?! it may have been different + if 16-18 year olds would have voted it would have been majority remain for sure, which would have made more sense as we ARE the future generation, not the pensioners and over 65's whom don't like the EU because of history/past events.
    It's already been proven that 16-17 yr old voting would have had no impact on the result even if every predicted voter had voted to remain.*
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    (Original post by HucktheForde)
    I had a lot of brexiter friends who said it's gonna be alright .😢

    What did you invest in if you are not uncomfortable that I asked?
    Primarily FTSE tracker*
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    Start exporting something manufactured with raw materials sourced in this country and don't use any petrochemicals in its production (good luckw ith that)... you'll make a killing!
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    Seriously though, we've had corrections like this in the past. 2007-8 after Northern Rock, much earlier with Wilson's 'pound in your pocket'. It'll creep back up again, though probably not to where it is now, but it's overvalued anyway at the moment. Don't fret about it.
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    (Original post by azizadil1998)
    Marshall Lerner is more short term/long term elasticity but they key here is how it will affect british exporters due to what they actually export (which as i said previously is high quality/expensive, relatively inelastic goods/services). I think if there will be an effect on imported goods prices or a small exporting competitive advantage it will come in a few years, depends how long "Long term" takes to kick in.
    Erm...that is exactly what Marshall Lerner is about.
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    (Original post by HucktheForde)
    I have a lot of £ in my bank, could have bought something else that can retain value. Just didn't thought it would be this bad.
    I'm not overly concerned.

    While i do not like currency depreciation (i'm a strong currency man myself) i made an informed choice when i voted for Brexit and essentially priced in a potential recession as per the treasury's worst case scenario. A fall in Sterling was always a logical consequence in that context.

    It is my belief however that a weak pound especially (currency is far more reactive than the general economy) is only a short to medium term feature. There will be further falls from now through the negotiations (especially since both sides will posture) however it is my belief that the negotiations will be relatively swift and will be complete by late 2018 (with an exit date sometime in the Spring). Once we have an agreement and the economy has not imploded (still a chance it could but it seems not so far) then markets will calm and Sterling will start to appreciate again. While i doubt that we will reach the levels seen in 2014 ($1.71), it seems reasonable that the fair level for Sterling is something akin to the level it was at shortly before the Brexit vote so around $1.40.

    Moral of the story - Short term Pain, Long term gain.

    Hold your course people.

    ..

    To discussing the impact of the depreciation it's worth thinking outside the box beyond the textbook effects of a fall in the exchange rate. For example when it comes to exports you forget that a strong currency provides an incentive for exporters to cut costs more aggressively and be more innovative in terms of quality. With regards to the UK in particular we are also a service sector economy so a fall in inflation caused by rising currency will almost always be more beneficial to the overall economy.

    .....

    To the people discussing Bitcoin, it's not an investment. Bitcoin is the type of thing you take a punt on if you have a hundred quid spare, you then leave it in your room for a few years with no real expectation of return and check again at a later date. Crypto currency is highly unstable, moreso than RL.
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    Im not on about short and long term elasticity though, im talking about the elasticities of UK exports in general, not the short and long term effects because I dont think there will be much effect on our exports like i said previously.
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    (Original post by Reue)
    Couldnt care less, the increased value of my investments has more than covered the falling pound value.

    Regardless; having a weak pound isn't necessarily a bad thing.
    But don't you reckon that depends how weak it stays in the next few years? Could have a potential negative impact unless the government tries to diversify the economy a bit more and produce more goods domestically. If done correctly, I actually think Brexit could be a way for the government to try and revive some of the industries like manufacturing or food, but of course this is entirely optimistic and will never happen!
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    At this rate, the £350 million for the NHS would get them some bandages and a packet of aspirin.
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    (Original post by samantham999)
    Lol its just volatility calm down
    If it was just "volatility" there would be upwards movement as well as downwards. Since June 23 the pound has just been falling, with a definite downward trend and only negligible upward bumps.
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    (Original post by zainyyyyy)
    you should've brought bitcoin

    edit - a drop in the value of the pound means imports will cost us more. This means the poor will suffer more + the inequality of wealth will increase. As well as that to my memories didn't Nigel Farage say that voting brexit is for the working class?
    the £350 million a week that the NHS is receiving as a result of Brexit is worth considerably less now. *
 
 
 
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