Approaching $2 to the £

Discussion in 'Politics, Religion, Social Issues' started by edesignuk, Apr 17, 2007.

  1. edesignuk Moderator emeritus

    edesignuk

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    #1
    Crikey. What's going on across the pond chaps?

    Just reading the paper this morning, it was at £1=$1.993 yesterday. Analysts are expecting the magical $2 to the pound to pass by the end of the week for the first time since 1992.

    Airlines are gearing up for masses of Brits heading to NYC for some cheap shopping (despite the pesky import tax when you get back to the UK) and I'm cringing looking at what Macs cost here verses the US [​IMG]
     
  2. iBlue macrumors Core

    iBlue

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    #2
    I found a decent article about it (a couple years old but it still applies)

    more within source

    and it appears they were right.
     
  3. solvs macrumors 603

    solvs

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    #3
    Have you seen the cost difference with Adobe? You guys are getting ripped. Either that, or Adobe thinks things are going to get better for us and they don't want to take the hit if the dollar goes back up. :rolleyes: Keep waiting Adobe.

    Guess that sort of kills the myth that neocons are better with the economy too. That whole "borrow and spend" thing we're doing isn't working out so well. Never thought the Democrats would be thought of as the fiscal ones. :eek:
     
  4. miloblithe macrumors 68020

    miloblithe

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    #4
    Probably only going to get worse for us and better for you. Our debt as a percentage of GDP has grown from about 59% to probably 66% since Bush took over. The UK's seems to have grown as well, but from about 40% to 42% in the same time if I recall correctly.

    http://en.wikipedia.org/wiki/List_of_countries_by_public_debt

    On the other hand, the UK 2006 trade deficit was $136 billion, 7.1% of GDP and a growth rate of 2.7%. The US 2006 trade deficit was $845 billion, only 6.3% of GDP, and a growth rate of just over 3%.

    Hmmm. And as near as I can find, the UK net international investment position is -265 billion pounds, compared to the US position of -2.7 trillion dollars. That's actually better in the US, as a percentage of GDP.

    http://dsbb.imf.org/Applications/web/sddscountrylist/

    Blimey.
     
  5. edesignuk thread starter Moderator emeritus

    edesignuk

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    #5
  6. Desertrat macrumors newbie

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    Terlingua, Texas
    #7
    $1.99, yesterday; $2.002, this morning. The Euro is at $1.3545. Courtesy the free daily email, "The Daily Pfennig" from http://www.Everbank.com.

    A fair amount of the decline of the last several years is the disparity in interest rates. The Fed is between a rock and a harder rock. If interest rates are raised to strengthen the dollar, the housing market gets clobbered even worse than at present, and the sound of the bubble's popping gets louder. We're in rather a stagflation mode, with inflation in actuality being higher than the official reports, while the economy is slowing notably. Strengthen the dollar, fight inflation, clobber the economy...

    (The official inflation rate does not include transportation, housing, medicine, education and food, as these are alleged to be "too volatile". Since the overall trend has been "volatile-ly" up, I'm underwhelmed by the logic. I note, however, that this is a long-term behavior by the CPI boffins.)

    Looking at the gross numbers of our GDP, I've slowly been coming to the conclusion that governmental effects are much less than the societal effects and the Fed. Not sure, yet, how strongly I believe this. The federal deficit has been dropping; the trade deficit has been rising. "We have met the enemy, and he is us."

    The overall policy since the beginning of the dot-com bubble of the 1990s has been to avoid any harsh downturns or recessions. That's primarily the decision making by the Fed and their juggling of the Fed interest rates. I'm among those who think that the longer serious corrections are deferred, the harder the fall.

    'Rat
     
  7. iGav macrumors G3

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    Mar 9, 2002
    #8
    The markets want it that's for sure, though it'll need to exceed $2 to get that at the Bureau.

    Can't wait for the next batch of interest rate hikes too. :D
     
  8. Desertrat macrumors newbie

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    Location:
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    #9
    Yeah, it's expected that the minutes of the BOE will show a leaning toward higher interest rates. Factory prices rose the most in 11 months, with their higher costs being passed on to purchasers. Housing prices in England rose the most since 2004, raising fears of inflation.

    'Rat
     
  9. Queso macrumors G4

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    #10
    It's passed the $2 mark again. Does this mean Apple's "record profits" are actually nothing of the sort?
     
  10. miloblithe macrumors 68020

    miloblithe

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    #11
    I think you're right on. Unfortunately, while I definitely agree that we need to curb our imports to some kind of more sustainable level, it's hard to know how to do it to some degree. A lot of raw materials are going to come from abroad because the US doesn't produce enough (oil obviously, diamonds, nickel, platinum... I don't know, tons of stuff). Then we have a hard time competing on intermediate goods like steel. And then for a lot of manufactured goods, who knows where all the materials come from and where all the manufacturing was done? Admittedly, the excuse is partly laziness, but it would take a lot of time to figure that out for everything one buys.

    I didn't know that about the official inflation rate. That definitely seems to exclude most of the fastest rising costs.

    I do think you are underestimating the effect of government spending, however. I think there is a large effect currently in the difference between $1.8 trillion (last year under Clinton) and $2.8 trillion (FYO7 under Bush). And there is a larger effect to come.

    Part of the large fall we're all anticipating...
     
  11. edesignuk thread starter Moderator emeritus

    edesignuk

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    #12
    It's been steady at over $2 for the last few hours, slowly but surely getting higher and higher. Now I wonder what it'll be like by closing on Friday :eek:

    Still, my $32 per month hosting package will be even cheaper than normal :D
     
  12. Queso macrumors G4

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    #13
    LOL. And it's just in time for me to renew my $25 MR membership :D
     
  13. princealfie macrumors 68030

    princealfie

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    #14
    Sorry but I prefer the other kind, no thank you.
     
  14. kretzy macrumors 604

    kretzy

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    #15
    Similar thing's happening down here. AUD $1 = US $0.83, hasn't been this high for nearly two decades. I'll also be taking advantage when I renew my membership at the end of the month. :D
     
  15. Sdashiki macrumors 68040

    Sdashiki

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    #16
    Innuendo. I like it.
     
  16. Desertrat macrumors newbie

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    #17
    The Aussie dollar is expected to continue its rise against the USD. Mostly, the export of commodities to China.

    Jobs are good, money's in circulation, the central bank wants to avoid inflation, so any rise in rates means a strengthening of the currency.

    'Rat
     
  17. Blue Velvet Moderator emeritus

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    Jul 4, 2004
    #18
    Just been reading a piece in The Guardian that quotes:

    Time to consolidate and reduce personal debt, I think. In terms of the cost of borrowing, we've had it good in the UK for a few years. Think that's going to change soon.
     
  18. Ugg macrumors 68000

    Ugg

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    #19
    Looser lending laws, looser credit regulation, etc, etc, are all what has led to the current housing crisis. To claim that it's all societal ignores the fact that while the Fed may have only a limited impact, the smaller laws can have a huge impact.

    Whatever the case, too many Americans are over extended and too much is being purchased from overseas. I'd really like to go to yrup this fall but $2 to the £ is just outrageous....
     
  19. Swarmlord macrumors 6502a

    Swarmlord

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    #20
    Sage advice.
     
  20. Desertrat macrumors newbie

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    #21
    Ugg, I follow your point about loose credit, etc., but nobody forced those folks to go out and buy a lot more house than they could afford.

    But, it's like a lot of purchases: "I don't care what it costs, as long as I can make the payments!" To me, there's a helluva lot of that nonsense in our society. Why else than that sort of mindset is the average non-mortgage credit card debt, said to be $9,000 per household, average?

    I and most of my friends are pretty much at zero, so somebody's in a world of hurt. (Shrug.) Tough.

    :), 'Rat
     
  21. Queso macrumors G4

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    Mar 4, 2006
    #22
    Easy for your generation to say. The ridiculous rise in property prices has benefited those of a certain age at the expense of the generations behind them. Those in their 20s and 30s are stretching to the max on their mortgages because they have to.

    No excuse for the credit card debt though. That's the "Got to have it NOW!!!" mentality, promoted very effectively by the banks. People who fall for that are being conned by clever marketing.
     
  22. Desertrat macrumors newbie

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    #23
    "Those in their 20s and 30s are stretching to the max on their mortgages because they have to."

    'Scuse me. My wife and I rented some rather shabby quarters, when we were in our 20s and 30s. We didn't even think about buying. It was not until we had our finances well under control that we consdered buying. Even then, it was one of the smallest houses in the neighborhood. 2BR, 1ba, 1,100 sq-ft.

    'Rat
     

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