There’s a bit missing from this time frameSeptember 10, 2021September 10, 2021 Tim WorstallRagging on Ritchie42 Comments The bit that’s being missed in that little hope is that there will be much in those bank accounts to convert on 1/2 Jan…..given that they themselves are predicting depreciation, won’t everyone move into sterling first, before the Bawbie? previousErm, this is known alreadynextThis isn’t how it works, Matey 42 thoughts on “There’s a bit missing from this time frame” RichardT September 10, 2021 at 11:27 am Erm – I always struggle to get these the right way round – but if they’re saying by the end of the year one Jocknote will be worth £1.12, doesn’t that mean they claim the Jocknote will appreciate, not depreciate? Not saying their claim is likely or feasible, just that that does seem to be their claim. Or is your depreciation comment coming from somewhere else? John Galt September 10, 2021 at 11:30 am All of which is a complete waste of time since the whole point of this period of financial interregnum is to act as a transition to the Euro which will be required before re-integration of Scotland into the Federal European superstate. I suppose it might allow the SNP to inflate away their debts Venezuela-style before Scottish accession, but it still doesn’t solve the problem of the deficit, which with everyone who can flee across the English border doing so, is only going to get worse in the years of chaos between a Scottish Independence referendum voting yes and Scottish accession. Even then I still suspect that current EU members like Spain might veto Scottish accession to prevent fuelling their own home-grown succession movements. By comparison, BRExit/COVID would seem like a walk in the park. Fortunately, even with all the SNP propaganda, the Scots aren’t yet stupid enough to fall for this. Sure, they’ll raise the Saltire and do the usual Scottish pro-patria virtue signalling, but in the privacy of the voting booth they’ll vote against independence because they know that the SNP’s Independence claims are utter hogwash and without the financial support of HM Treasury they would be phuqed. Arthur the cat September 10, 2021 at 11:40 am “before the Bawbie” Surely it’s 100 bawbies = 1 Poond? The bawbie is/was quite small in value. The Mole September 10, 2021 at 11:42 am John I envy your optimism on the general ability to think of the population. I fear the evidence from Brexit is that (for both sides) little of the voting decisions were based on analysing the consequences of the decisions and were instead based on soundbites and feelings. Not all perhaps, but enough to make nothing certain. Personally I think we should put the Scottish government in charge of resolving the Northern Island protocol issues. If they can’t produce a viable plan for that, how on earth are they going to manage the much more integrated English border, particularly if they are selling re-joining the EU as a foregone conclusion. The Mole September 10, 2021 at 11:50 am Richard I to struggle with this. I think the explanation is: 1st January: £1 = SP1 = 1 loaf of bread 31 December: £1 = SP1.12 We’ll assume that the purchasing power of £1 in England doesn’t change in a meaningful way (£1=£1=1 loaf). If you have SP1000 on 1st January you could buy £1000. On the 31st December you can sell your £1000 for SP1120 and make an apparent profit of SP120. But the purchasing power of the Scottish pound will have decreased, you would still only be able to buy 1000 loaves of bread – its value has depreciated. Worse than that, the price of importing 1000 loaves of bread may have increased (border delays, red tape etc) so your SP1120 may only buy you 900 loaves of bread north of the border. John Galt September 10, 2021 at 12:10 pm I fear the evidence from Brexit is that (for both sides) little of the voting decisions were based on analysing the consequences of the decisions and were instead based on soundbites and feelings. Not all perhaps, but enough to make nothing certain. I guess one of the advantage of living amongst the Scots here in Perth while being “not of them” is the ability to observe them at close range. I wouldn’t say they’re being hypocritical, just that they like the idea of an independent Scotland without the reality of what that transition would actually be like. You are of course right that I could be mistaken. In which case the Scots deserve to get what they vote for. Good and hard. Jack C September 10, 2021 at 12:18 pm If SP1 will equal GBP1.12, then that assumes appreciation surely? I don’t suppose they could say anything else really. bloke in spain September 10, 2021 at 12:20 pm No. They’re saying the Jockish Bawbie will be at £1.12 denominated in GBP. Since they’re claiming the Bawbie will be unchanged against USD & Euro their fantasy assumes the GBP will be weaken by Joxit. Personally I’d expect parity with the COP* in six months & the Bolivar in nine. *Most Colombians are millionaires. Even the unemployed. The same will be claimed as a Jockish economic miracle MyBurningEars September 10, 2021 at 12:33 pm @bis Indeed they’re expecting a very sharp depreciation of the GBP! But even then it doesn’t make sense. Markets are forward-looking. You might reasonably argue the GBP’s depreciation would happen the night of the indy referendum result (though looking at it in terms of the government deficit etc you might reasonably argue the opposite, if you weren’t a Scottish nationalist at least), or maybe it would happen the day the Scottish government announce something that means they’re 100% committed to an independent currency and squash any remaining speculation they will hang on to the GBP after all, but why would you be so confident the GBP would depreciate purely because the Scottish currency had gone physical and removed its peg? How can you possibly claim to know this will happen in advance – if it is as perfectly predictable as you say it is, then it won’t happen because the market movement would have happened earlier? There’s “planning” and there’s “wishful thinking”, and the oddly specific prediction about the GBP depreciating in this timeframe is indicative of the latter. The way it doesn’t address at all the issue of people shifting their bank accounts, just assumes everyone, even fervent indysceptics, will blithely sit on their backside and obediently wait for their currency to be switched over – is indicative of a lack of the former. John Galt September 10, 2021 at 12:36 pm Personally I’d expect parity with the COP* in six months & the Bolivar in nine. *Most Colombians are millionaires. Even the unemployed. The same will be claimed as a Jockish economic miracle Perhaps, but the Columbians and Venezuelans have always been like this and have employed a huge army to enforce their “economic miracles” and protect the elite from their own citizens. The SNP would have to go a long way in a short time to achieve the same without Nicola and her band of demented porridge wogs hanging from the lamp posts on the Royal Mile. MyBurningEars September 10, 2021 at 12:47 pm Incidentally, anyone got any idea why someone might have plucked the number from thin air that Sindy would cause the GBP to depreciate by 12%, specifically? Scotland’s only 8% of the UK’s population (down from about 9% in 2000 and 10% post-WW2) and it’s poorer than England, so an even smaller share of the GDP. Even if you were acting on the entirely naive calculation “well you’re losing X% of your population and economy, so your currency will go down X% to match” then you wouldn’t get such a shift. (And certainly you wouldn’t expect such a change to materialise purely because Scotland has followed through with a plan that, by that stage, it had long been clear it was committed to – if anything you’d expect that shift to occur at the time this possible future path became the probable one. But that’s the point of my previous post.) So why think it would make a 12% difference, other than the fact you *want* or *hope* for it to make a 12% difference? Jim September 10, 2021 at 12:52 pm So they are assuming a newly independent country that has a far larger budget deficit than the country they emerged from would actually manage to have its new currency appreciate? What planet are they on? Even pre-covid they were running a budget deficit of what, 8% of GDP? And they think there’s going to be people queuing up to buy this once in a lifetime investment opportunity? John Galt September 10, 2021 at 1:28 pm So why think it would make a 12% difference, other than the fact you *want* or *hope* for it to make a 12% difference? Well, if you’re going to fantasise that by some miracle and a sprinkle of pixie dust the Scottish Baubie wouldn’t be in the toilet post-Independence (it will), then you might as well go the whole hog and imagine that it’s going to appreciate for some vague reason. I suppose the better question is why stick at 12% appreciation? Why not 1200% or a billion? No doubt there is some idiotic nonsense about “GDP per capita in line with other similarly sized Scandiwedien countries”, but that leaves out more than it adds. Andrew M September 10, 2021 at 1:51 pm Gangs of marauding “independence enforcers” will ensure that nobody is holding imperialist oppressor currency. Any forgetful citizens of the Independent Republic of Scotia will be offered the opportunity to surrender their illegal holdings. RichardT September 10, 2021 at 2:08 pm From Wikipedia, a bit of history to learn from: “David II of Scotland ended the parity between Scottish and English coins, resulting in an English proclamation banning the lower quality Scottish coins from their country in 1356. … Robert III of Scotland continued to devalue Scottish coins, making them worth one-half of their English counterparts by 1392. … Ordinances required Scots to turn in their old coins in exchange for new issues struck to a lower standard, thereby providing a profit to the king. … In 1604, the year after the Union of the Crowns, the Council ordered Scotland to use the same coinage standards as England; a new gold coin, called a Unit in Scotland or Unite in England, was valued at £12 Scots or £1 sterling. … James VII of Scotland reverted to silver coins with denominations in shillings, now with the weights adjusted to reflect an exchange rate of 13 shillings Scots to 1 shilling sterling.” jgh September 10, 2021 at 2:10 pm Hold on, so on 2nd January they’re going to take everybody’s money? RichardT September 10, 2021 at 2:11 pm Andrew M said: “Gangs of marauding “independence enforcers” will ensure that nobody is holding imperialist oppressor currency. Any forgetful citizens of the Independent Republic of Scotia will be offered the opportunity to surrender their illegal holdings.” Indeed, and they have done it before. As I quoted above, from Wikipedia but probably still true: “Robert III of Scotland continued to devalue Scottish coins, making them worth one-half of their English counterparts by 1392. Ordinances required Scots to turn in their old coins in exchange for new issues struck to a lower standard, thereby providing a profit to the king.” MyBurningEars September 10, 2021 at 2:34 pm @John Galt “Well, if you’re going to fantasise that by some miracle and a sprinkle of pixie dust the Scottish Baubie wouldn’t be in the toilet post-Independence (it will), then you might as well go the whole hog and imagine that it’s going to appreciate for some vague reason.” Since the supposition is that the Scottish pound will stay stable (“more or less unchanged”) against the US dollar and euro, I don’t think their logic is that the Scottish pound is soaring in value – rather, the failed-union-pound will fall 12% against the dollar and the euro, while the Scottish pound holds stable. The mindset seems to be less “independent Scotland will be so great its currency will immediately soar” and more “what’s left of the UK without Scotland in it anymore will be a failed state that investors will be rushing out of”. If they’d just said “the Scottish pound will rise roughly 10% against a basket of international currencies, and slightly more against the rump GBP as its value falls” then that’s just coming from a headspace of Scandifantasy. I might not buy it, but if people honestly believe post-indy Scotland is Basically Norway, I could see where it’s coming from. Instead, the plan seems more akin to “the English economy will fall off a cliff once we cunningly let them off the hook for our fiscal burden”. I’ve got no idea if that’s pure vindictiveness, some kind of oppressor-must-suffer wishful thinking, a serious attempt at analysis of trade-flow disruption of an Anglo-Scottish hard border, some geopolitical hypothesis that what’s left of post-Sindy UK would face a deep political and constitutional crisis or retreat into petty nationalist isolationism, or is this all due to an exaggerated self-importance wherein they assume Scotland is far more important to the UK economy than it actually is? I can’t work it out. Bloke in North Korea (Germany province) September 10, 2021 at 2:53 pm What makes you think people will freely be able to convert currencies in unlimited quantities? Come on, us lesser mortals have only been allowed to do that for part of the time since the end of Bretton Woods. I’m only not quite old enough to remember when you could only take £50 out of the country without permission, and am old enough to remember when every international transaction went through the BoE. Given the purpose of central bank digital/crypto currencies is to restrict how citizens may use, save, spend, transmit, etc, their money, in ways we have only just begun to imagine, people will probably find their Scottish balances forcibly converted to Jockstraps with no/limited options to turn that into Sterling or anything else. Mr Ecks September 10, 2021 at 3:05 pm A much simpler plan would be to crush both SNP and Welsh Crew and smash both Duckturd and Krankie. Arrest the 2 of them and free speech killer Humza for Treason.Jail the twats for decades. Or better decades of silence and community service for the miscreants. End Scot/Welsh bungling and promote sane non-marxist local policies. And arrange for Krankie to be killed by a pair of RoP within 2 years. Ducky McDuckface September 10, 2021 at 3:15 pm Monday 10th March 2025. Looks a bit odd. “Peg to Sterling Ends”, OK, fair enough. Are they actually hoping everyone assumes it’ll be at 1:1 to begin with? “ForEx trading starts”. Eh? Doesn’t this seem to imply some pretty stringent capital controls previously? “Bank Charges apply to transactions”. Whut? FX only or FTT? Then you get to 31 December and the apparent 12% appreciation. “Scottish Reserve Bank … £50Bln … Euro, Dollar, Yen blah”. Are they implying that they’ll successfully manage the currency upwards relative to Sterling by mediating through the basket? Presumably, Sterling would fall relative to the basket weights as they’d get rid of any Sterling exposure on either 1 Jan or 10th March, and then any Sterling holding resulting through normal trade activity would immediately be sold for the basket. This is Brown Bottom territory on or around 10th March, with a subsequent bounce? Eh? Ducky McDuckface September 10, 2021 at 3:26 pm Hmm. Dual Currency Board? Jonathan September 10, 2021 at 3:35 pm Given that the whole point of the political union between Scotland and England was to bail the spendthrift f**kers out, why would anyone with half a brain imagine that things will turn out differently now? rhoda klapp September 10, 2021 at 4:01 pm Did anyone mention their share of the national debt mountain? IF they were to start with a clean sheet and rUK was stuck with it all, there is the basis for the UKP to lose value against the Bawbie. How would they get away with that? Because terms of the separation will be decided by some stupid English knidjit who would bloody well give it away, or make provision for the day when the Jocks come back having realised the error of their ways. Couldn’t happen? Look at the UK-Ireland Common Travel Area, still favouring Paddystan after 100 years. BraveFart September 10, 2021 at 4:03 pm I’m hoping relative tit sizes up here will appreciate 12% against those down south John Galt September 10, 2021 at 4:04 pm Instead, the plan seems more akin to “the English economy will fall off a cliff once we cunningly let them off the hook for our fiscal burden”. I’ve got no idea if that’s pure vindictiveness, some kind of oppressor-must-suffer wishful thinking, a serious attempt at analysis of trade-flow disruption of an Anglo-Scottish hard border, some geopolitical hypothesis that what’s left of post-Sindy UK would face a deep political and constitutional crisis or retreat into petty nationalist isolationism, or is this all due to an exaggerated self-importance wherein they assume Scotland is far more important to the UK economy than it actually is? I can’t work it out. @MyBurningEars – In fairness, because we’re trying to figure out rationally and with varying levels of financial understanding, what is essentially the fevered ravings of lunatics. The SNP are makes nonsensical assumptions about Scottish debt, the deficit, the economy and the EU’s desire to clasp a secessionist Scotland into its bosom. Why? Because only by doing so can they put forward an argument that is pro-Independence. The reality is that every one of the above items (debt, deficit, economy, EU) is a catastrophic minefield. If either the rump UK or EU decides to screw Scotland, there’s absolutely nothing the Scots, SNP or the Scottish government could do about it as they have zero leverage. It would make BRExit/COVID look like a walk-in-the-park. Boganboy September 10, 2021 at 4:12 pm I’m naturally thinking of the Aden Protectorate, that also ran a permanent deficit for the whole of British rule. They first held a conference with the UK in Switzerland. No money. Next they got the USSR to provide them with the cash. The Russians then pushed them to liberate the poor, oppressed Dhofaris, and of course the oil, from wicked Oman. But the Scotch already own the oil. Do you think they’ll put an extra tax on it to cover their deficit? bloke in spain September 10, 2021 at 4:21 pm Columbians use the $US, Mr Galt. Although food stamps are second currency in the vibrant parts. John Galt September 10, 2021 at 4:33 pm But the Scotch already own the oil. Do they though. What if the Shetlands / Orkney / Outer Hebrides / Western Isles suddenly decided they wanted a separate Independence as a British Crown Dependency. After all, the oil would be in their waters, not the political caliphate of Edinburgh-Glasgow pretending to represent Scotland. Why not? What’s sauce for the goose is sauce for the gander. The union was always about containment of “the Scottish problem” and nothing more. pils September 10, 2021 at 5:10 pm “Sterling account balances sold to the Scottish Reserve Bank”. Whose account balances? All UK banks with account holders with Scottish addresses? Foreign (now English) banks with same? Scottish registered banks eg Royal Bank of Scotland? What about Halifax? What happens if said banks relocate before the split? UK government may roll over, but pretty sure the banks won’t. RichardT September 10, 2021 at 6:11 pm rhoda klapp said: “Did anyone mention their share of the national debt mountain? IF they were to start with a clean sheet and rUK was stuck with it all, there is the basis for the UKP to lose value against the Bawbie.” But, but, Murphy tells us that it is only government debt that gives a currency any value, so surely the Scottish government would want to take on as much of the old UK debt as we would allow them? Kjerulf September 10, 2021 at 6:20 pm You brits are forgetting an important thing: if indeed Jockistan becomes a republic, the Shetlands revert to Denmark. Anyway, the timeline leaves out 14 January, first signs of famine. And 21 January, first reports of cannibalism john Galt September 10, 2021 at 6:23 pm You brits are forgetting an important thing: if indeed Jockistan becomes a republic, the Shetlands revert to Denmark. That’s a rather “colonialist” attitude. If “self-determination” can apply to the Falkland Islanders it certainly applies to the various windy islands off the coast of the Peoples Socialist Republic of Jockistan. Max September 10, 2021 at 6:49 pm Rideout obviously know nothing of how sort codes, collection accounts etc work. I have a question regarding investment: I have investments with a very large investment company based in Aberdeen which are denominated in GBP but which are worldwide investments. What will happen to them – does any one ethink/ Bongo September 10, 2021 at 7:56 pm I wonder how the IoM, Jer and Gue currency pegs have remained in place for so long. Presumably sensible people on both sides for a long time. But if the UK government were to carry on printing say a tenth of expenditure for more years, and a suitable alternative international currency e.g. Euro or even CH franc was available then they would be sorely tempted to break that peg before Brits started coming over and buying all their stuff. Bloke in North Korea (Germany province) September 10, 2021 at 8:09 pm Ecks, Oligarchical Collectivism has already won. Everywhere. What they are doing now is just rubbing the individualist’s nose in it. Forever. Bloke in North Korea (Germany province) September 10, 2021 at 8:14 pm “I have investments with a very large investment company based in Aberdeen which are denominated in GBP but which are worldwide investments. What will happen to them – does any one ethink/” The conservatives will ensure that they are liquidated and spent for the benefit of the collective rather than for the benefit of unreformed bourgeoise class enemies like you. Then they will ensure that you are liquidated, for the benefit of the collective. Bloke in North Korea (Germany province) September 10, 2021 at 8:15 pm “I wonder how the IoM, Jer and Gue currency pegs have remained in place for so long. ” The governments of very small places have no debt and no deficit? Look, these are places that don’t even need to raise income tax, or not much. The same argument as Germany being in the euro – piggy back on an artificially weak currency to keep people buying. John Galt September 10, 2021 at 9:17 pm “I wonder how the IoM, Jer and Gue currency pegs have remained in place for so long. ” Not sure how Jersey and Guernsey do it, but Manx Parliament (Tynwald)’s Currency Act of 1992 provides for free convertibility on demand between Manx currency and UK Pounds Sterling at any branch of the Isle of Man Bank. So if they did start devaluing the currency by printing notes left-right-and-centre, such devaluation could be legally avoided by exchanging Manx currency for UK Pounds Sterling at parity. In addition, the printing of Manx currency is limited and regulated by the Manx Parliament which strictly regulates the amount of currency in circulation at any one time to support the liquidity of the local economy, which is limited by the relatively small size of the islands population. BiTiN September 10, 2021 at 10:07 pm Brave Fart Or even more practically that their underbits tighten by 12%… Nessimmersion September 11, 2021 at 9:11 am Why would the Shetlands revert to Denmark? More probable is a bidding process whereby the 3 or 4 crowns, Norway, Denmark, E&W and or Scotland decide to which crown the crown dependency goes. Given the Shetlanders often claim to be more Norwegian & Norway is closest and richest, Id put my money on them. Its an absolute given that once you start dissolution of a country, there is no reason for the prosperous parts of Scotland to stay funding the bitter wee Natzis. Resurrection of the Kingdom of Northumbria? Baron Jackfield September 11, 2021 at 10:54 am On a purely practical note… “1st / 2nd January, 2025” – Currency in bank accounts converted to “Bawbies”, Vending machines and ATMs converted… “3rd February, 2025” – New currency on public sale and new credit/debit cards go live… So WTF are people going to spend, and live on, for all of January? Leave a Reply Cancel replyYour email address will not be published. Required fields are marked *Comment Name * Email * Website Save my name, email, and website in this browser for the next time I comment.