'Run on UK' sees foreign investors pull $1 trillion out of the City

Andrew64

So not just a run on the banks, but a run on the country!

http://www.independent.co.uk/news/business/news/run-on-uk-sees-foreign-investors-pull-1-trillion-out-of-the-city-1639413.html

A silent $1 trillion "Run on Britain" by foreign investors was revealed yesterday in the latest statistical releases from the Bank of England. The external liabilities of banks operating in the UK – that is monies held in the UK on behalf of foreign investors – fell by $1 trillion (£700bn) between the spring and the end of 2008, representing a huge loss of funds and of confidence in the City of London. Some $597.5bn was lost to the banks in the last quarter of last year alone, after a modest positive inflow in the summer, but a massive $682.5bn haemorrhaged in the second quarter of 2008 – a record. About 15 per cent of the monies held by foreigners in the UK were withdrawn over the period, leaving about $6 trillion. This is by far the largest withdrawal of foreign funds from the UK in recent decades – about 10 times what might flow out during a "normal" quarter.

amcluesent

Like the true socialist he is, Clown will soon reimpose exchange controls, repeating the timeline of 1973-1977 now that printing money has commenced.

"British Pounds must and will stay in the hard-working pockets of British families. Hoots!"

Then again, Harriet Harperson will demand that foreign investors be judged in the international court of international public opinion.

Generali

amcluesent wrote: »

Like the true socialist he is, Clown will soon reimpose exchange controls,

If foreign money keeps going out of the door at the same rate then he'll have little choice but to introduce exchange controls.

1echidna

Generali wrote: »

If foreign money keeps going out of the door at the same rate then he'll have little choice but to introduce exchange controls.

Wouldn't exchange control's, in the place where it matters, City trading, cripple London as a trading centre?

Generali

1echidna wrote: »

Wouldn't exchange control's, in the place where it matters, City trading, cripple London as a trading centre?

Possibly, depending how it's done of course.

The trouble with the course that Brown has embarked upon is that you can quickly find yourself painted into a corner.

What will he do when bond investors won't buy any more Gilts?
What will he do when the Chinese spend their surpluses at home rather than on propping up UK demand?

It seems to me that the UK Government is engaged in a long version of crisis management with no clear plan as to how to get from where you are to where you want to be.

ruggedtoast

I dont think they know where they want to be. I know where I'd like them to be though.

Guy_Montag

I would have thought currency controls would be in breach of EU regs.

The govt. knows where it wants to be - c. March 2007 - but nothing is going to get us there.

Generali

Guy_Montag wrote: »

I would have thought currency controls would be in breach of EU regs.

The govt. knows where it wants to be - c. March 2007 - but nothing is going to get us there.

Probably it would be contrary to lots of treaties. All that stuff is going out of the window - look at what Sarkozy is doing for example, in effect he's paying French car companies to close factories in Eastern Europe.

The 'Buy American' policy in the US for the US Government is contrary to many treaties.

Ditto lending banks cash cheaply so they can undercut their rivals.

Graham_Devon

Ahhhh lets blame America.

1echidna

Graham_Devon wrote: »

Ahhhh lets blame America.

Reminds me of those naughty gnomes in Zurich.

Generali

WFT? wrote: »

We will then be able to protect jobs in the UK, expatriate foreigners and make sure the few jobs we have here are taken by UK citizens.

You're a BNP idiot. Sadly there'll be a lot more people seduced by your bullpoo in the next few years I suspect.

I wrote a nice argument to contradict you but I really can't be bothered. You, Zammo and all those other BNP supporting idiots aren't worth the time to think about the argument let alone type it.