If there was a general election tomorrow...

[bickster]

No, its a coalition government,

and a step closer to Ashdowns "it's inevitable" merger of the labour party and the Libs dems ..million € question is what deal will it take to bring the libs to the table ..Gordon promising to stand down for Clegg ?

anyway it's all pure pish , wait til the electioneering starts and the Murdoch wagon kicks in.. there are whispers abound that the Brown Bully story was a red herring and the real events are far far worse

Ashdown would be wrong though, he seems to forget that the make up of the Liberal vote is as much disaffected Tory who would never vote Labour in a month of Sundays as it is genuine liberal party supporters who actually understand their politics

[Awol]

Bicks, that you missed the clear implications of a hung parliament (another Brown led Gov is what the markets are fearing) if it were to replicate the Sunday Times poll numbers is hardly my fault. Labour can't run an election on the basis of Brown being their leader only to ditch him in the following days in order to try and form and Government, it's fantasy land. The Libs will do whatever they need to get some influence and I think the Tories would rather lose than not have a clear mandate for the surgery required to UK Plc. I've said for a long time we'll end up with a lab/lib coalition and a second election before christmas with a landslide victory to the right. Of course by then it will be too late.

I can't be bothered to argue though because you are clearly unable to admit you simply got it wrong.

Taxi!

[bickster]

(another Brown led Gov is what the markets are fearing)

No, it's not, you've actually made that up by and large the markets couldn't give a shit which tory party is in control as long as they are in control convincingly.

You seem to think there are vast differences in the two parties economics policies, there isn't, its just a case of same horse different jockey. The markets prefer a clear favourite so they know where to put their money

[tonyh29]

Ashdown would be wrong though,

with respect I think he knows a bit more about these things than we do ...

i've mentioned it here before but Blair agreed to the merger of the parties , it was a done deal .. and then at the last minute went back on the deal when Prescott and Brown told him they would resign if it went ahead

[bickster]

Ashdown would be wrong though,

with respect I think he knows a bit more about these things than we do ...

i've mentioned it here before but Blair agreed to the merger of the parties , it was a done deal .. and then at the last minute went back on the deal when Prescott and Brown told him they would resign if it went ahead

Nah, can't see it ever happening, the country would be worse of for it too

[Awol]

(another Brown led Gov is what the markets are fearing)

No, it's not, you've actually made that up by and large the markets couldn't give a shit which tory party is in control as long as they are in control convincingly.

You seem to think there are vast differences in the two parties economics policies, there isn't, its just a case of same horse different jockey. The markets prefer a clear favourite so they know where to put their money

I disagree. It's pretty well accepted that the Tories are going to cut the arse out of public spending to get the deficit under control, with Labour the opposite is true. Ergo, the markets (rightly in my view) fear a Labour victory, be that outright or as the majority part of a coalition government.

[tonyh29]

But the markets are reacting to a possible hung parliament

but The pound has been the weakest major currency over the past week, the past month and in 2010 to date so they aren't just reacting to a yougov poll .. they are reacting to this government

the sterling slide actually started last week when sterling fell through an important chart point against the euro but escalated today on news of the survey at the thought of Brown staying in control as it is widely believed ,that should he do so , Darling will finally get the Spanish archer and be replaced by Ed Balls

so a part of what Jon says is true

and he is further backed up by many experts , for example

Nick Beecroft, senior foreign exchange consultant at Saxo Bank perhaps summed up today's mood. "This morning we have witnessed what can justifiably called the beginnings of sterling's collapse," he said. "So long as the markets could harbour some hope that the next government, in only three months time, would be a fiscally prudent, business-friendly Conservative one that would act swiftly to reduce the UK deficit and borrowing mountains, the pound was able to just about hold its own against the euro (which is itself entering a possibly fatally damaging period), but today the dam burst and it could not even do that, let alone against the almighty dollar – as of now perceived as the 'best, worst' major safe-haven currency. This weekend's UK election polls predicting a Labour government, ruling over a 'hung' parliament, put paid to that dream."

so in effect the economy recovery hinges on the markets believing that Brown will be gone ... so the sooner he calls this election the better for all

[Si.]

UKIP?

[bickster]

I disagree. It's pretty well accepted that the Tories are going to cut the arse out of public spending to get the deficit under control, with Labour the opposite is true.

See there's another bit you've made up, that is simply not true and there's no evidence to suggest it either, all I'm hearing from the red tories is cuts cuts cuts, same from the blue tories because that is what they have to do to balance the books, either side has to do the same

Ergo, the markets (rightly in my view) fear a Labour victory, be that outright or as the majority part of a coalition government.

Why would the markets fear an outright Labour Victory? Wasn't it Labour who saved their arse very recently? wasn't it Labour that allowed such lax regulation of the financial markets in the first place? They have **** all to fear from a Labour outright victory, in fact if they are scared of anything in a lib/lab pact it would be the do gooding left wing moral crusaders of the Liberal party, they are the unknown quantity not Labour

[Awol]

[and he is further backed up by many experts

What do you think is shaping my views mate, I'm not pulling them out of my arse!

EDIT: Feck it Bicks, you obviously know everything so we may as well close the thread. As Tony has pointed out, I'm not making this up at all, just a little wider read than you it appears.

[snowychap]

I think that you should, at the very least, thank Mr Elliott, Tony.

so in effect the economy recovery hinges on the markets believing that Brown will be gone

What have the markets got to do with economic 'recovery'?

And just to chuck this in to the mix, Flanders in her blog today reckons that traders would have good reason to be binning sterling regardless of whether it was a hung parliament, a Tory win or a Tory lite win.

[tonyh29]

do i have to thank ...Auf Weidersehen Pet for the Spanish Archer gag as well ? :-)

markets and economic recovery are linked ..simples

everyone wants to pretend that thye will regulate the banks and be watching them closer than Rob watched porn but reality is once the election is over loopholes will be found to let the banks quietly get on with things and generate some lovely cash again

[drat01]

Ironically the doom and gloom that Jon is predicting (again) is not reflected by various comments by industry today on the radio etc. Cheaper exports etc helping growth.

A quick trawl around backs up everything that Gareth is saying in respect to share prices and currency exchange and hung parliaments. The more ominous thing is the ability and seemingly willingness of outside organizations (maybe they are non-Doms?) to publish so called informed reports that have a knee jerk reaction on markets. I wonder how much of these are prompted by a need to have a market at a certain point to make even more money for themselves?

[wiganvillain]

[and he is further backed up by many experts

What do you think is shaping my views mate, I'm not pulling them out of my arse!

EDIT: Feck it Bicks, you obviously know everything so we may as well close the thread. As Tony has pointed out, I'm not making this up at all, just a little wider read than you it appears.

Not taking sides here -------- but, and you all knew a but was coming

Regardles to how widely read one is, don't your views and opinions colour what you read, both source and interpretation of content, thus defeating the argument.

I write this purely as I've read articles backing up both of your views, the choice of which I believe is down to personal politics and therefore doesn't mean the other view is wrong, my view may be wrong.

[tonyh29]

A quick trawl around backs up everything that Gareth is saying in respect to share prices and currency exchange and hung parliaments

and yet a quick trawl around also backed up Jons comments

what a strange world we live in :-)

the truth is probably as per Wigans post above though

[bickster]

Why a hung Parliament would be a disaster for the markets

19 February 2010 | By Hannah Stodell

’Equity investors would just assume there would be policy stasis, infighting and indecision’

Harrison: ‘Risk appetite would reduce

Financial experts believe that a hung Parliament after the next general election could be a disaster for markets.

Speaking at a Threadneedle round table in London last week on the outlook for the UK in the run-up to the election, head of UK equities Leigh Harrison said the equity market would regard a hung Parliament as “a disaster”.

He said risk appetite for equities would suffer as investors would react negatively to uncertainty over the Government’s ability to deal with the public sector debt. Harrison said: “The equity market would regard it as a disaster.

The market is looking for strong leadership. I do not think either party has got particularly strong leaders but you would have thought with a reasonable mandate for one or the other that they might have the confidence to take some decisive policy steps.

“There is a campaign at the moment to try and get the electorate comfortable with the idea of a hung Parliament but I think that equity investors will be far more cynical. They would just assume there would be policy stasis, infighting, indecision, all of the things that you do not really want when you are dealing with the issues that we are dealing with.

“I think that risk appetite in equities would reduce because the assumption would be that you would get a muddle for a fair while and I do not think they would regard that as a positive outcome at all.”

Head of government bonds Quentin Fitzsimmons said a hung Parliament would be equally unwelcome for the gilt market. He said: “The increasing possibility of a hung Parliament is unwelcome because the balance of power will be unclear at a point in time in the cycle when the deficit issue is abs-olutely critical.

“If there is a bit of a hiatus as a result of the election in terms of seeing a way to bring the deficit under control, then I am afraid the government bond market will probably lose patience with the situation.”

Fitzsimmons said there are some safety mechanisms that would support sterling but the short-term effect on the currency would be uncomfortable.

He said: “There would be the concern about when the rebalancing would eventually occur and sterling would pro-bably stay on the back foot in that environment.”

Milestone Wealth Management principal Neil Mumford says: “It would not be good. There is nothing worse than two parties that could argue over policy decisions, particularly with the deficit we have got.

“The recovery is going to take a long time so the market this year is going to be tricky to call but it does make it worse when you have not got a majority decision. I think it will create more nervousness for equities than there is currently.

“We have seen a lot of turbulence in the market already this year and that would continue if we were in a situation where there was a hung Parliament.”

But Alan Steel Asset Management consultant Alan Adam says the outlook for the country looks bleak, irrespective of which party is in power.

He says: “To some extent, we would probably prefer a hung Parliament to the Tories getting in as we do not think the economy is at the stage where it could cope with the dramatic cuts they are planning.

“A hung Parliament or even Gordon Brown and his cronies getting back in might at least leave the same fiscal policy in place which would allow us to recover fully before we start the stringent cuts that are required.”

Clicky

Written over a week ago before the slump

Sterling’s the victim of a possible hung Parliament

March 1, 2010 1:33pmby Chris Giles

Sterling is being sold across the board. At lunchtime it was down almost 2 per cent against the currencies of Britain’s main trading partners. There are a bunch of technical reasons why it seems to be in freefall. Figures from the Chicago Mercantile Exchange suggest traders are building up short positions in sterling, the news that Prudential has agreed to buy the Asian operations of AIG insurance group for $35.5bn will create a significant new demand for foreign currency, and the FT’s story today that gilts are trading as if it has already lost the prized AAA_rated status have all put the skids Britain’s currency.

But the big concern in the markets is the chance of a hung Parliament after weekend opinion polls put the Conservative lead over Labour at only 2 per cent. On a uniform swing, this would not be far from sufficient for a majority Conservative government and would indicate a minority Labour administration is most likely. The fear is that such a government would be weak and indecisive in reducing the budget deficit, leading to further economic chaos.

While chaos is certainly possible, my fear about a hung parliament is not that consolidation is too slow, but rather the opposite. With the threat of another election hanging over politicians, the ever-present danger of political parties being blamed for fraying market confidence in Britain seems most likely to lead to extremely zealous budgetary tightening. If you think that is exactly what Britain needs, you should be delighted by today’s market nervousness - it is an appetiser for the real fears that would materialise in an inconclusive election.

But it you think, like me, that we need to be very careful about immediate additional fiscal tightening, then a weak government with a need to show its strength through forcing through an extremely tight budget is quite a consolidation worry.

Clicky

Aye experts we can all find them if we want to

[snowychap]

do i have to thank ...Auf Weidersehen Pet for the Spanish Archer gag as well ? :-)

You did lift an entire paragraph (verbatim) from his article, mate.

markets and economic recovery are linked ..simples

You tried to hint that markets would be the force behind an economic recovery (whatever that actually is). I was wondering how you had come to that conclusion.

everyone wants to pretend that thye will regulate the banks ...

I don't think that they have been pretending very hard. Really, who fell for it? Hands up in shame.

[tonyh29]

You did lift an entire paragraph (verbatim) from his article, mate

did not .. i lifted various paragraphs and condensed it into one .. i also thought it was obvious that i was borrowing material from another source but seeing as Weller never had to pay royalties to the Beatles for "Start "nor to ELO for "changing man" i figured it was acceptable to lift small pieces without giving credit to the source material :winkold:

[drat01]

Same old cockneys always stealing ...... :-)

[snowychap]

Cheaper exports etc helping growth.

Cheaper exports to whom, though?

It's the line that has been peddled since the pound started to struggle and it hasn't really seemed to bear fruit, yet.

Ironically, it's the line that Osborne has been trotting out for ages. :winkold:

His hope is that this increase in exports will take up the slack from cuts in public spending which would stop us sinking back in to recession. I've read a few people questioning that this would happen (especially as we would rely heavily on demand for our exports in Europe staying strong even whilst their economies are also struggling).