HardyBamboo Posted January 13, 2014 Author Share Posted January 13, 2014 No it isn't. Nor would it be desirable. I think it would be desirable for both countries in the short term, I don't think it would be in Scotland's medium to long term interests to stay in the GBP. Link to comment Share on other sites More sharing options...
Burma Posted January 13, 2014 Share Posted January 13, 2014 I think it would be desirable for both countries in the short term, I don't think it would be in Scotland's medium to long term interests to stay in the GBP. It would certainly be desireable for rUK whose currency value would spiral dramatically without Scottish assets. Link to comment Share on other sites More sharing options...
HardyBamboo Posted January 13, 2014 Author Share Posted January 13, 2014 It would certainly be desireable for rUK whose currency value would spiral dramatically without Scottish assets. I agree, that is why I said in an earlier post that we should be playing hardball with the currency issue. I wouldn't be surprised if the WG try to negotiate us staying in the pound for an extended period of time in return for agreeing a currency union. Strategically, I don't think a Scottish Government should agree to stay in the pound for anything other than the short term. Link to comment Share on other sites More sharing options...
Burma Posted January 13, 2014 Share Posted January 13, 2014 I agree, that is why I said in an earlier post that we should be playing hardball with the currency issue. I wouldn't be surprised if the WG try to jnegotiate us staying in the pound for an extended period of time in return for agreeing a currency union. Strategically, I don't think a Scottish Government should agree to stay in the pound for anything other than the short term. Spot on. The only real negotiation will be what guarantees that Scotland will give to the BofE that its assets will continue to underpin Sterling and for how long. Link to comment Share on other sites More sharing options...
10 CC ICT Posted January 13, 2014 Share Posted January 13, 2014 I'm interested to see in this morning's FT (no link - sorry it's behind a paywall) that the UK Government is to announce that it will underwrite all the current UK debt up until the point where Scotland votes Yes. To me (and I'm not an economist, clearly) this tends to suggest that the behind the scenes discussions on currency union are actually now accepting that if Scotland votes Yes and somehow, unaccountably, the rUK government refused to discuss a currency union, then Scotland could credibly argue that any UK debt before the vote is not Scotland's. Paste the url in here and it's captured in all it's glory with a unique archive.is address. http://archive.is/ ie. without suscription. http://www.heraldscotland.com/politics/referendum-news/carmichael-salmonds-blueprint-for-independence-is-mirage.1389625744 with subscription captured on http://archive.is/ http://archive.is/uXYwP Link to comment Share on other sites More sharing options...
PaulIsclosed Posted January 13, 2014 Share Posted January 13, 2014 No it isn't. Nor would it be desirable. Given that your argument is completely vacuous, do forgive me if I ignore it. Link to comment Share on other sites More sharing options...
stm Posted January 13, 2014 Share Posted January 13, 2014 I agree, that is why I said in an earlier post that we should be playing hardball with the currency issue. May I ask Hardy, what hardball positions we should be taking? Link to comment Share on other sites More sharing options...
HardyBamboo Posted January 13, 2014 Author Share Posted January 13, 2014 May I ask Hardy, what hardball positions we should be taking? I think the SG should be telling the WG that, unless they come out & support a currency union very shortly, that we wont join said union on independence. Link to comment Share on other sites More sharing options...
HardyBamboo Posted January 13, 2014 Author Share Posted January 13, 2014 I think the SG should be telling the WG that, unless they come out & support a currency union very shortly, that we wont join said union on independence. I think this guy sums up the WG debt guarantee strategy quite well; "The continuing state is deemed to be the same state obligated under treaties and agreements, AND responsible for ALL external debt. The fact that a portion of the territory of the original & continuing state is now a new state does not alter those privileges and obligations in any way. In this context consider the tautologies: The continuing state is that state which goes on and the new state in the state which comes into being. in the case of a split yielding two successor states, each states carries the burden of external debt proportionally, but the UK position is that Scotland would not be a successor state, it would be a newly created state. In the case of a continuing state and a new state, the new state has none of the rights and obligations under treaties and agreements entered into by the original and continuing state, and has no liability for any external debt owed by the original and continuing state. The UK’s creditors know this, and understand that if Scotland becomes independent as a new state, they have no legal claim against it for any portion of the debt owed to them by the continuing state. As long as the UK Government held that Scotland as a new state would be liable for a portion of UK external debt, it left creditors with the fear that the UK continuing may not honour its entire obligation, confidence was thus undermined and the degree of RISK associated with underwriting UK sovereign debt increases. Increased risk requires increase in the cost of borrowing and THAT is why HMG made this statement, to head-off that possibility." Link to comment Share on other sites More sharing options...
stm Posted January 13, 2014 Share Posted January 13, 2014 I think the SG should be telling the WG that, unless they come out & support a currency union very shortly, that we wont join said union on independence. An interesting tactic indeed. Therefore, on day one of independence in March 2016, what option would you be content with in terms of our monetary framework, bearing in mind we've formally binned sterling. Link to comment Share on other sites More sharing options...
Davi3j Posted January 13, 2014 Share Posted January 13, 2014 Windermere is a lake but it's not called Lake Windermere, simply Windermere. Ad Lib levels of pedantry there Link to comment Share on other sites More sharing options...
HardyBamboo Posted January 13, 2014 Author Share Posted January 13, 2014 FWIW I don't think that will happen, (in the short term), it is far too important for the WG to keep us in sterling, if it did there would be absolutely nothing, (as far as I can see), to stop us launching our own currency. Link to comment Share on other sites More sharing options...
git-intae-thum Posted January 14, 2014 Share Posted January 14, 2014 An interesting tactic indeed. Therefore, on day one of independence in March 2016, what option would you be content with in terms of our monetary framework, bearing in mind we've formally binned sterling. Don't see why we couldn't use sterling in the short term. Its a free traded currency. Our new central bank could just peg it to the GBP. This is obviously short to medium term until we negotiated entry into the Euro or equally launched our own. You know Norway with a smaller population than us has a freely traded currency on the forex. It is regarded as one of the firmist in the World. In my opinion that's where we should be setting our target points. Link to comment Share on other sites More sharing options...
Reynard Posted January 14, 2014 Share Posted January 14, 2014 I think the SG should be telling the WG that, unless they come out & support a currency union very shortly, that we wont join said union on independence. They won't. Link to comment Share on other sites More sharing options...
HardyBamboo Posted January 14, 2014 Author Share Posted January 14, 2014 They won't. I think they would be cutting off their nose to spite their face if that is the case, in my opinion it is time for the SG to force a definitive answer to this issue &, if none is forthcoming, make an alternative currency arrangement. Link to comment Share on other sites More sharing options...
The Master Posted January 14, 2014 Share Posted January 14, 2014 It would certainly be desireable for rUK whose currency value would spiral dramatically without Scottish assets. Unless I've missed something, those "Scottish assets" are owned by the UK, and if Scotland doesn't take on a portion of the debt would continue to be owned by the rUK. Link to comment Share on other sites More sharing options...
Reynard Posted January 14, 2014 Share Posted January 14, 2014 I think they would be cutting off their nose to spite their face if that is the case, in my opinion it is time for the SG to force a definitive answer to this issue &, if none is forthcoming, make an alternative currency arrangement. It was clueless of them not to have made alternative arrangements. Link to comment Share on other sites More sharing options...
H_B Posted January 14, 2014 Share Posted January 14, 2014 I think this guy sums up the WG debt guarantee strategy quite well; "The continuing state is deemed to be the same state obligated under treaties and agreements, AND responsible for ALL external debt. The fact that a portion of the territory of the original & continuing state is now a new state does not alter those privileges and obligations in any way. In this context consider the tautologies: The continuing state is that state which goes on and the new state in the state which comes into being. in the case of a split yielding two successor states, each states carries the burden of external debt proportionally, but the UK position is that Scotland would not be a successor state, it would be a newly created state. In the case of a continuing state and a new state, the new state has none of the rights and obligations under treaties and agreements entered into by the original and continuing state, and has no liability for any external debt owed by the original and continuing state. The UK’s creditors know this, and understand that if Scotland becomes independent as a new state, they have no legal claim against it for any portion of the debt owed to them by the continuing state. As long as the UK Government held that Scotland as a new state would be liable for a portion of UK external debt, it left creditors with the fear that the UK continuing may not honour its entire obligation, confidence was thus undermined and the degree of RISK associated with underwriting UK sovereign debt increases. Increased risk requires increase in the cost of borrowing and THAT is why HMG made this statement, to head-off that possibility." It's not really a "strategy", more a recognition of the international law position. One that i have made clear time and time again, and amusingly one the SNP have lied to people about. It's great to see them latch onto the very same law they have continually told people won't apply. Now it seems, we are to forget about John Swinney, Salmond and Sturgeon lying to people for years, airbrush that from history, and move on with the reality the SNP have denied. Brilliant! Link to comment Share on other sites More sharing options...
AUFC90 Posted January 14, 2014 Share Posted January 14, 2014 It's not really a "strategy", more a recognition of the international law position. One that i have made clear time and time again, and amusingly one the SNP have lied to people about. It's great to see them latch onto the very same law they have continually told people won't apply. Now it seems, we are to forget about John Swinney, Salmond and Sturgeon lying to people for years, airbrush that from history, and move on with the reality the SNP have denied. Brilliant! Correct. Link to comment Share on other sites More sharing options...
H_B Posted January 14, 2014 Share Posted January 14, 2014 Correct. Well, I'm glad we can all acknoledge the SNP are liars and have consistently told the Scottish people a lot of utter nonsense. Edinburgh knows best. Link to comment Share on other sites More sharing options...
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