SNP Win - The Economics of D-I-V-O-R-C-E

chewmylegoff

Shakethedisease wrote: »

I read this elsewhere that seems to explain things quite well, but I have no idea what it all means tbh.

It's also irrelevant for the same reason that losses racked up by ubs ag's London branch were not the problem of the uk govt.

LilacPixie

Generali wrote: »

A bit of a Google shows you are right.

Apparently the opinion polls show a minority of Scots in favour of independence at the moment so if you have a once in a generation opportunity to hold a referendum you'll do your utmost to make sure you win. It seems a bit weird to me that Scots would vote for a party when they don't believe in their very reason for existing.

I voted SNP on Thursday. I did so despite being very torn on the subject of independence. I have not looked at the specifics in any great detail, only bits posted on fourms like this. I am naturally suspicious so wonder why con/lib dem/labour want to keep scotland as part of the union? I also wonder why if there is evidence to show Scotland could not go it alone were these parties against a referendum altogether why not just preset all evidence and then let voters currently residing in scotland have their say.

I also think England and Wales should get a say too, do voters there want to continue the union or would they rather split .

Shakethedisease

It's also irrelevant for the same reason that losses racked up by ubs ag's London branch were not the problem of the uk govt.

Whoosh !

Are you saying that Scotland should soley be liable for all RBS and BOS debts or not ? And if so could you explain why in slightly simpler terms ? Because I can't see it myself.

I also think England and Wales should get a say too, do voters there want to continue the union or would they rather split .

I don't think that's going to happen.

Self determination is the principle in international law that nations have the right to freely choose their sovereignty and international political status with no external compulsion or external interference.

System

The right of any part of the UK to independence surely requires the consent of the remaining parts?
Supposing a rich region voted to become independent and stop subsidising the poorer? Would Surrey or Berkshire be allowed to become independent, even if 95% of their voters wanted it? Is there a minimum size below which peoples are not allowed to have self-determination?
Perhaps Orkney and Shetland, or Pembrokeshire, might not want independence.

Generali

Shakethedisease wrote: »

Whoosh !

Are you saying that Scotland should soley be liable for all RBS and BOS debts or not ? And if so could you explain why in slightly simpler terms ? Because I can't see it myself.

Without wishing to get too bogged down in irrelevent details, the liability for RBS London may lie with RBS in London or it may lie with RBS in Edinburgh depending on how RBS is set up.

Basically, if RBS Investment Banking London* was ring-fenced as a separate entity from RBS Retail Banking Edinburgh*with its own reserves then if RBS IB went bust RBS RB could carry on as before.

That would be a pretty unsual structure for lots of reasons, the main two being that it would be very expensive. This is because it would increase the risk of excess reserves being held and also it would mean each entity would get a separate credit rating, probably making the junior entity less profitable.

The main costs for a bank are the costs of money. Anything that increases that cost is generally avoided.

The shorter version is that Edniburgh aren't necessarily responsible for the liabilities of the London division but they probably are.

Kohoutek

Generali wrote: »

The shorter version is that Edniburgh aren't necessarily responsible for the liabilities of the London division but they probably are.

And even if they're not, Alex Salmond wants Scotland to follow a low corporation tax policy, which might have the effect of encouraging the nominally Scottish banks to transfer their business' legal structures entirely to Scotland.

chewmylegoff

Shakethedisease wrote: »

Whoosh !

Are you saying that Scotland should soley be liable for all RBS and BOS debts or not ? And if so could you explain why in slightly simpler terms ? Because I can't see it myself.

I don't think that's going to happen.

as generali says, banks from other EU countries which operate in the UK do not tend to set up their own distinct legal entities simply to operate in the UK because it is inefficient to do so. generally speaking, they are registered in their home state and operate in other EU states with agreement with the banking regulator in each individual state.

thus, whilst BOS / RBS may have a raft of companies, some registered in scotland and some in england & wales, if scotland was historically independent of england & wales, it is almost certain that their main banking operations would all be registered in scotland and "passported" in to operate in the city (whilst being mainly regulated from scotland).

Kohoutek

LilacPixie wrote: »

I voted SNP on Thursday. I did so despite being very torn on the subject of independence. I have not looked at the specifics in any great detail, only bits posted on fourms like this.

Some of the counter arguments to independence are:

• If the national debt was apportioned between the UK and Scotland fairly, for example in proportion with Scotland's GDP, an independent Scotland would start with a debt to GDP ratio of 100% and very likely higher borrowing costs than the UK
• Scotland has a larger dependence on public sector jobs than the average for the rest of the UK. Some of these jobs would be lost if Scotland became independent if they are reliant on work from the rest of the UK (e.g. National Savings).
• Scotland would have to incur additional costs related to becoming an independent nation, e.g. defence and setting up and maintaining embassies
• North sea oil is in rapid decline
• (Presumably) as a member of the eurozone, Scotland would be subject to monetary policy set by the European Central Bank, which has created problems for small EU nations recently (e.g. Greece, Ireland)

Shakethedisease

Thanks for that Generali and chewmylegoff.

So you mean if Scotland had been independent ? Because I've read a lot of comments here and elsewhere that are simply assuming that the debt WILL belong to Scotland because the two banks have the word in their names.

And even if they're not, Alex Salmond wants Scotland to follow a low corporation tax policy, which might have the effect of encouraging the nominally Scottish banks to transfer their business' legal structures entirely to Scotland.

Lucky then, that it seems the SNP are in favour of splitting up the banks these days.

The right of any part of the UK to independence surely requires the consent of the remaining parts?
Supposing a rich region voted to become independent and stop subsidising the poorer? Would Surrey or Berkshire be allowed to become independent, even if 95% of their voters wanted it? Is there a minimum size below which peoples are not allowed to have self-determination?
Perhaps Orkney and Shetland, or Pembrokeshire, might not want independence.

Nations are allowed self-determination should they wish to excercise it under international law. Surrey isn't.

Our country is rich in resources. So here we are in this lucky, lucky country – we have oil and gas aplenty, we have huge supplies of the most precious resources of the 21st century, water, we have land and sea resources, we have one quarter of Europe’s wind resource, one quarter of its tidal resource and one tenth of the wave resource and we have the skilled and inventive people..
.
...The unionist parties oppose independence not because they think Scotland is too poor, but because we are rich. What they really fear is the loss of Scottish resources

( Salmonds conference speech March 2011 )

I wonder if the last sentence has a nugget of truth in it ?


"UK Energy Minister Charles Hendry has argued that Scotland must not benefit from her natural resources at the expense of the rest of the UK...
He added: "This year we expect investment in the North Sea to be up by 60% on the last two years, potentially halving the rate at which production is declining. ....
....."But if we want to achieve that, then it's not Scotland against England, but a British Government supporting Scottish businesses, for the benefit of Scotland, and Britain."

http://www.newsnetscotland.com/scottish-news/1855-scotland-must-share-her-natural-resources-argues-tory-minister.html

Anyway, I'm still undecided about independence ( believe it or not lol ).. but I think it's a very interesting debate.

Generali

Shakethedisease wrote: »

Thanks for that Generali and chewmylegoff.

So you mean if Scotland had been independent ? Because I've read a lot of comments here and elsewhere that are simply assuming that the debt WILL belong to Scotland because the two banks have the word in their names.

You can call your bank whatever you like and it doesn't mean your head office is there. For example, HSBC used to stand for Hong Kong and Shanghai Bank Corp yet it's head office is currently in neither city.

I'm making an assumption that if Scotland was already independent then RBS and BoS would have decided to have their HQ in Scotland as that is where a large part of their retail base is. I further assume that a newly independent Scotland would have bank customers who would be sensitive about 'their' bank moving 'down south' so it would be expedient for both banks to have HQs in Scotland.

At present, it makes little practical difference whether the base of RBS is in Edinburgh or London as both cities are in the same country.