Pound to become worthless like the dollar?

[chris25]

British Pound to Euro Exchange Rate

http://ichart.finance.yahoo.com/1y?gbpeur=x

Our economy based on services and money transactions, once a strong and mighty force is now becoming pathetic compared to the euro zone where manufacturing and agriculture are still rife.

Maybe booze cruises and cheap piss ups in Spain will soon become a thing of the past?

[Totally_Baffled]

yep our manafacturing base is so small its only the fifth largest in the world by value!

Although only a 25% share of our economy it has still grown fairly consistently over time in real ? terms - just not as fast as services (including finance)

And believe it or not this 25% figure is larger than many other OECD countries....

We have it bad, but context is needed sometimes methinks!

As for the US - they are the largest manafacturer in the world by value, and their manafacturing exports are only second to Germany!

The dollar problem comes from importing too much crap that they dont need and cannot afford! Ditto for the Uk!

[fifthcolumn]

yep our manafacturing base is so small its only the fifth largest in the world by value!

Although only a 25% share of our economy it has still grown fairly consistently over time in real ? terms - just not as fast as services (including finance)

And believe it or not this 25% figure is larger than many other OECD countries....

We have it bad, but context is needed sometimes methinks!

Yes, this is a bit of good news I think.
Between manufacturing and oil we have a bit of time to get our house in order here.
If only we were able to stop dilly dallying in appeasing the "save the birds" people we would be able to get enough renewables built to have a happy bright future.

I think instead at best we will muddle through as always though I don't have too too high hopes that "the best" is what we are going to get.

[chris25]

When it comes to manufactured goods we have one the largest trade deficits in the world (apart from USA).

We import $200 billion dollars more then we export

Manufacturing output has only risen slightly but consumption per person has dramatically increased.

Remember oil is a manufacturing output as well.

Our industries are all owned by foreigners as well, so when things get tough then they wont think twice of closing down the uk factories first.

[RenewableCandy]

We import $200 billion dollars more then we export
...

Ouch!! That's ?3000 of Chinese tat per Brit per year!

Our industries are all owned by foreigners as well, so when things get tough then they wont think twice of closing down the uk factories first.

If the ? is cheap, our factories will make stuff cheaply, and that at least will be a point in their favour.

[biffvernon]

When it comes to manufactured goods we have one the largest trade deficits in the world (apart from USA).

We import $200 billion dollars more then we export

That's quite smart really. We get foreigners to do a lot of the hard dirty work while we chat round the water cooler.

[chris25]

When it comes to manufactured goods we have one the largest trade deficits in the world (apart from USA).

We import $200 billion dollars more then we export

That's quite smart really. We get foreigners to do a lot of the hard dirty work while we chat round the water cooler.

couldn't put it better!

[SunnyJim]

Smart my arse!!! Look at how much we've had to borrow to do it!!! The country and you and I will be in debt for ever to these countries. We will be working simply to pay the interest on govement deficit to banks that are owned by China or Middle Eastern countries, because they saved and we spurged (as nations you understand). The money will not stay in this country. The tables have turned.

It used to work like this;
We lend money (via locally owned bank) to set up a factory, factory builds stuff for us, and everyone borrows from our banks and pays back interest. We then spend interest on things they make for us....

However our profligate spending, and China's careful saving and single child policy etc has meant that they have saved money and are now buying our banks.... we will be paying interest to them, and they will be spending it on stuff we make, the profit of which we then pay back as interest. Debt is a very powerful thing.... and it will mean we're working for a very very long time to pay back interest.

[SunnyJim]

Unless of course world trade breaks down. Or we declare the country bankrupt (no country would trade with us again).... the alternatives to a life of debt slavery in the UK are pretty horrible too.

Or we manage to find someone else to lend to at higher rates than we have to payback at....

[RenewableCandy]

Or we manage to find someone else to lend to at higher rates than we have to payback at....

The good ol' US of A donchalove'em! That's what friends are for...

[Totally_Baffled]

When it comes to manufactured goods we have one the largest trade deficits in the world (apart from USA).

We import $200 billion dollars more then we export

Manufacturing output has only risen slightly but consumption per person has dramatically increased.

That is true - hence my comment about reducing consumption at home , and increasing exports. As the pound devalues against other currencies (particularly the euro), the UK's exports become extremely competitive.

Hence the rebalance of the trade deficit over time.

Remember oil is a manufacturing output as well.

Ok exclude oil and UK manafacturing shrinks to 23% of the UK economy, and still remains 7th largest manafacturer in the world (Italy and France would over take us )

Our industries are all owned by foreigners as well, so when things get tough then they wont think twice of closing down the UK factories first

And what about all the UK owned/part owned firms abroad? or don't they count?

[UndercoverElephant]

The UK could save a lot of money by stopping pretending to be a world power and wasting untold billions in military adventures which appear to serve no purpose whatsoever.

Cost of replacing Trident: ?76bn

[chris25]

Totally_Baffled
Figures have quite remarkably changed a lot, although manufacturing output has slightly increased (but the whole economy has expanded)

Manufacturing was 25% of GDP about 15 years ago. It is now 14.7% and after you take oil around 10%.

The housing market is almost a higher GDP then manufacturing combined.

Compare this to germany where 80% of economic growth has been down to its exports in recent years.

[Totally_Baffled]

Totally_Baffled
Figures have quite remarkably changed a lot, although manufacturing output has slightly increased (but the whole economy has expanded)

Manufacturing was 25% of GDP about 15 years ago. It is now 14.7% and after you take oil around 10%.

The housing market is almost a higher GDP then manufacturing combined.

Compare this to germany where 80% of economic growth has been down to its exports in recent years.

The world bank

Hi Chris.

According to the world bank (see link) manafacturing is $508 billion versus a total GDP of $2.1 trillion (24.1%)

But that said , we could be using different measures.

All the same if you compare the %'s from the same source (the world bank), the UK is not very different from many other OECD countries.

Manufacturing in France is 20% of GDP, Japan & Germany is 30%, USA 22.8%, Italy is 26%, Netherlands 24.6% etc etc

I dont think we are in a bad position from this point of view.

Oil is worth $54 billion of that $2.1 trillion so it only puts the UK down to 22% of GDP.

[chris25]

Totally_Baffled
Figures have quite remarkably changed a lot, although manufacturing output has slightly increased (but the whole economy has expanded)

Manufacturing was 25% of GDP about 15 years ago. It is now 14.7% and after you take oil around 10%.

The housing market is almost a higher GDP then manufacturing combined.

Compare this to germany where 80% of economic growth has been down to its exports in recent years.

The world bank

Hi Chris.

According to the world bank (see link) manafacturing is $508 billion versus a total GDP of $2.1 trillion (24.1%)

But that said , we could be using different measures.

All the same if you compare the %'s from the same source (the world bank), the UK is not very different from many other OECD countries.

Manufacturing in France is 20% of GDP, Japan & Germany is 30%, USA 22.8%, Italy is 26%, Netherlands 24.6% etc etc

I dont think we are in a bad position from this point of view.

Oil is worth $54 billion of that $2.1 trillion so it only puts the UK down to 22% of GDP.

Manufacturing output is only 14.7% of GDP according to Forbes, I think your figures may include utilities.

As finance sectors and pointless service sectors go in to decline and collapse then manufacturing will become increasingly important, because manufactured goods are a nessesity even if their consumption is significantly reduced. Manufactured goods sit just behind food and water production, and have been something man has required since the dawn of time.

Yet our manufacturing sector is in a very dangerous position due to foreign ownership and lack of raw engineering. TATA (the indian company which basically owns our car industry and whole entire steel industry. Thank you labour!) are at the hands of millions of jobs. Once demand for industrial steel drops and demand for cars drops then the British plants will be slashed no questions asked.. There also is very little investment in renewable energy production in this country- we should be making wind turbines, solar panels, hydro-generators etc etc but we just import the darn things from the krauts or denmark.

We have flogged off our family silver in a disgusting manner, and its hit our life line as well.