Is the UK finished?

[MohdSalleh]

Pound Drops Against Dollar as S&P Says U.K. Banks Less Stable
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By Matthew Brown

Jan. 28 (Bloomberg) -- The pound fell against the dollar after Standard & Poor’s said U.K. banks are no longer among the world’s “most stable and low-risk” as the economy stagnates.

The British currency pared an earlier advance against the euro as S&P analysts said the U.K. banking industry may face losses as indebted consumers reduce borrowings. S&P had already lowered the U.K.’s place in its Banking Industry Country Risk Assessment gauge to Group 3 from Group 2 on Dec. 21.

“Sterling has come off aggressively in the wake of the S&P statement,” said Steve Barrow, head of Group-of-10 currency strategy at Standard Bank Plc in London. “The pound is vulnerable, especially against the dollar and the yen.”

The pound fell 0.1 percent to $1.6149 as of 5:15 p.m. in London, after climbing 0.7 percent earlier. It dropped 0.4 percent to 145.01 yen and climbed 0.2 percent to 86.55 pence per euro, paring its earlier 0.8 percent advance.

The U.K. government provided more than 1 trillion pounds ($1.62 trillion) to rescue lenders including Royal Bank of Scotland Group Plc and Lloyds Banking Group Plc amid the worst financial crisis since the Great Depression.

U.K. government bonds fell after the Financial Times cited Robert Stheeman, who runs the nation’s Debt Management Office, as saying that it will be more difficult to sell gilts without the Bank of England buying the securities. The bank completed its 200 billion-pound ($325 billion) asset-purchase program on Jan. 26 and will decide whether to continue so-called quantitative easing at its next meeting on Feb. 4.

The yield on the 10-year gilt rose 7 basis points to 3.95 percent. The 4.5 percent security maturing in March 2019 fell 0.52, or 5.2 pounds per 1,000-pound face amount, to 104.21. Two- year gilt yields also climbed 7 basis points, to 1.27 percent.

Darling Deficit Plan

Gilts have returned investors 1 percent this year, compared with 1.3 percent for German government bonds and U.S. Treasuries, according to data from Bank of America Corp.’s Merrill Lynch unit. U.K. government bonds slid 5.3 percent in the same period a year before.

Chancellor of the Exchequer Alistair Darling rejected criticism about Britain’s debt today, citing his plan to halve the deficit in four years. “We have the fastest deficit reduction plan of major economies,” Darling said in an interview with Bloomberg Television.

The U.K. government bond market will be “O.K.” this year, according to Ian Williams, chief executive officer of gilt fund Charteris Portfolio Managers, countering comments from Pacific Investment Management Co.’s Bill Gross, who said yesterday that the securities are “sitting on a bed of nitroglycerine.”

“The U.K. will have very anemic growth of less than 1 percent for the next three or four years,” Williams said in a Bloomberg Television interview. “We place a 40 percent probability on the U.K. falling back into recession and further cuts in interest rates.”

To contact the reporters on this story: Matthew Brown in London at mbrown42@bloomberg.net

 

[henry76]

micheal jackson is finished , the 19th century is finished, unless the uk sinks beneath the waves it isn't "finished"

 

[Kassz007]

WW2 finished the UK.

 

[FredBloggs]

Quote from Kassz007:

WW2 finished the UK.

???

it finished germany, who finished poland, netherlands, france, and italy.

i think europe is in a stronger position than the usa.

 

[mavericktrader]

Tell me who other than China, Australia, and Brazil look strong here. And even they have their problems. I don't think this global slowdown is over yet.

 

[Kassz007]

Quote from FredBloggs:

???

it finished germany, who finished poland, netherlands, france, and italy.

i think europe is in a stronger position than the usa.

I was speaking economically. It could even be argued that WW1 was what broke the back of the UK economically.

 

[Wallace]

Quote from Kassz007:

It could even be argued that WW1 was what broke the back of the UK economically.

and there was me thinking it was the Royal family

 

[MohdSalleh]

Britain did not "Finish " germany. The russians did at a cost of 20 million lives.

 

[fkbsuhites]

The UK was finished the day they let Rupert Murdoch consolidate the media there.

The degradation of America started in the 1980's with the confluence of Murdoch buying up American media, the neo-commie Reagans bankrupting war policies and the rise of the evangelical nut wing.

So you see. both countries are now beyond F'ked. The lesson? Don't let Murdoch into your country. Next F'ked in the list is China. They messed up by letting Murdoch get a toe hold.

 

[henry76]

finished means "ended" even iraq is not "finished " it's still there afghanistan is not "finished " either , it's still there , things may be bad terrible horrific , but very few countries finish , even if uk goes bust it will still be there , it's never finished untill it's ended , i know you don't understand england but one might hope you would understand a modicum of english.