Vox Populi Vox Dei
High Tory
The fact remains that the previous forecasts said no growth. Now the UK is forecast to be the top out of the major advanced economies.
-
Join the MyBroadband community
South Africa’s biggest forum. Discuss, discover, and connect with thousands of members.
-
Question of the Day: Which is the most hair-raising South African mountain pass you've driven?
The Brexit Thread
- Thread starter OrbitalDawn
- Start date
- Status
The fact remains that the previous forecasts said no growth. Now the UK is forecast to be the top out of the major advanced economies.
And Zim/Venezuela were even better by that logic!
McSack
Executive Member
OK so I haven't had the chance to go take a gander at other other sources but on the face of it the PwC graph is showing "Average annual real GDP growth rate" as a % is it not? . Where do you see this growth is expressed in "tanked GBP" ??
Last edited:
Real growth after inflation in domestic currency is the standard way of quoting these figures, unless you need to compare across countries. Did you not see the headlines when India, France etc leapfrogged the UKs GDP (in USD) after the Pound collapsed?
McSack
Executive Member
But the comparison in the PwC graph is across countries.
Japan, Italy , Germany, France, US, Canada , UK.
Are you saying that PwC predicted and compared growth based on the relevant currency of each individual country? That would just be silly
Haven't found the specific report to look at yet but...
more here
I don't think BREXIT's going to be easy sailing by a long shot, but I don't reckon PwC would make such and amateurish mistake by not comparing growth on an equal currency basis
Last edited:
You're missing my point. They've just had almost 20% of their GDP wiped out. The fact that they're growing at .1 or .2% points faster than other major economies is meaningless since it is from a dramatically reduced base. It's going to take decades of growth like that to make up the lost ground.
Arthur
Honorary Master
Only if you think exchange rates are the main way you value GDP. The real world doesn't work like that. A snap of forex valuation of local production of goods and services is playing with statistics.
Last edited:
Hamish McPanji
Honorary Master
It is a factor though, especially in a currency swing of that amount. Inflation due to this is continuing to rise.
So what base measure (currency, gold standard) should GDP be measured against?
McSack
Executive Member
OK , I get what you are saying. I don't agree, but let me think about it before I talk kuk
In general net exports have an inverse correlation with the strength of the domestic currency, which would mean a higher GDP
You could also look at GDP PPP but I think inflation is going to outrun real wage increases in the UK, so those numbers are going to get worse too.
Arthur
Honorary Master
Ultimately it's a notional thing anyway.
To illustrate with an extreme but real example:
When Zim's currency dropped to a millionth of its forex value a year earlier, people inside Zim weren't a millionth poorer than a year before. They hadn't in the real world cut the production of goods and services to a millionth of the previous year.
Likewise, when a currency devalues or revalues, nominal GDP might move up and down accordingly in relation to other nominal valuations - but that only shows that exchange-valued GDP has a rather tenuous relation to what actually happens between people who produce and exchange real goods and services.
All money is a fiat proxy for a very complex and mysterious thing: human-intellect-and-work-applied-over-time-in-the-material-world.
Pitbull
Verboten
The drop was due to market uncertainty. The pound still 20% weaker than before brexit?
Yea, didn't think so... It's now on a similar level it was in 2015 around mid year. So what now? Did the UK crash and burn like the naysayers said? The increase in growth against market predictions indicates there is a recovery so it will take time for the ripples to dissipate but then again, economics doesn't seem to be your strong point right The_Assimilator?
Against USD it's about 17.5% down. Against AUD/NZD even more (>25%). This is easy to check on xe or oanda...go look for yourself. Don't know where this "yea didn't think so" nonsense comes from, you thought wrong.
Meanwhile "Brexit" actually hasn't happened yet.
Just before Brext, Pound to Rand was at R25 to £1. Its now struggling to break R17.
Similar with the USD and so on.
Hamish McPanji
Honorary Master
Pitbull
Verboten
Vox Populi Vox Dei
High Tory
So what I gather is actual output isn't down, it is just currency depreciation. You ignoring the fact that it could very well strengthen. It's very easy to see that the EU will collapse in time anyhow. Britain will be gathering steam and the EU economies will be going backwards or stagnating.
I checked your link. Pound is no where near 2015 levels.
Lowest in 2015 was 1.4632. Mid year 2015 was around 1.55.
2016 post Brexit, highest is at 1.25.
Could you be more explicit with your data?
If the UK can strike an interim deal, then yes it will strengthen. In fact that's what is supporting the GBP now. If the UK exits on WTO terms, then it will weaken.
Recent growth figures show the EU outstripping the US in terms of growth.
Pitbull
Verboten
Yea was talking about from our point of view. Rand v Pound was similar around mid 2015. We still doing ok, so the UK is still doing ok. I want to see when and where this omfg, UK is doomed is going to happen.
- Status