Re: [Pen-l] query: pound vs. euro

[dsquared@xxxxxxxxxxxxxxxx]

also note that like the US and unlike euroland, UK has had an actual financial crisis involving central bank bailout (Germany has had a couple of banks fall over, but the industry there has more or less sorted it out internally)

 

best

dd

----- Original Message -----
From: "soula avramidis"
To: "Progressive Economics"
Subject: [Pen-l] query: pound vs. euro
Date: Mon, 28 Apr 2008 02:18:34 -0700 (PDT)

here's a note

for a while 2003 up 2007 the pound rose against the dollar and over the last year it stabilized, while the euro kept rising. the market for the pound is small and for the euro it is big. with all the uncertainties associated with the euro, the big market alone for the euro would make exchange alignments centre on these two currencies ($ and euro). the pound and the euro have closer 'tarde' ties but the departure between the two as of last year may be due:

1 to speculative activity around the euro as more investors shift to the euro.

2 in the seventies the yen rose against the dollar and there was war spending, and the euro is rising against the dollar now and there is war spending now.

3 more importantly global imbalances are not due to exchange rate overvaluation or differences in economic structure but to the ability of the US to draw resources from the rest of the world by its sheer imperial standing and strength.

 

it is in respect to the last point that the relationship between the pound and the dollar has to be seen especially in so far as the UK is the imperial partner of the US and in that regards it is structured more like the US in so far as the partition of imperial rent

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