[user104658]

... Companies, "but it's just a coincidence!" Says TiBB

The UK has been stripped of its last AAA rating as credit agency Standard & Poor’s warned of the economic, fiscal and constitutional risks the country now faces as a result of the EU referendum result.

The two-notch downgrade came with a warning that S&P could slash its rating again. It described the result of the vote as “a seminal event” that would “lead to a less predictable stable and effective policy framework in the UK”.

The agency added that the vote to remain in Scotland and Northern Ireland “creates wider constitutional issues for the country as a whole”.


S&P was the last of the big three ratings agencies to have a blue-chip rating on the UK’s credit-worthiness. Moody’s, which stripped the UK of its top notch rating amid the austerity cuts of 2013, said last week it might further cut its view of the UK.

Rating agency moves have the potential to make it more expensive for the government to borrow.

The S&P move came after another torrid day on the financial markets. The pound hit fresh 31-year lows and £40bn was wiped off the value of the UK’s biggest companies on Monday, despite efforts by George Osborne to quell investors’ concerns about the economic and political ramifications of the Brexit vote.

After three days of silence,*the chancellor*made a statement on Monday morning to try to calm the markets. However, sterling remained under sustained pressure on the foreign exchange markets as economists slashed their forecasts for UK economic growth. Wall Street was also weaker while continental bourses sold off sharply*after Friday’s record $2tn of losses on global stock markets.

Expectations are mounting that the Bank of England will cut interest rates – possibly to zero from their historic low 0.5% – to stimulate the economy, and yields on government bonds fell below 1% for the first time, which could spell cheaper mortgage rates.

In a live broadcast just after 7am, as dealers in London braced for another day of turmoil, Osborne insisted: “Our economy is about as strong as it could be to confront the challenge our country now faces.”

But moderate losses on the FTSE 100quickly deepened and at one point sterling was down 3.5% against the dollar, at $1.3122, its lowest level since 1985. Against the euro, the pound was down 2.4% at €1.19.

Speaking at the World Economic Forum in China, Nouriel Roubini, economist at New York University, described Brexit as “a major significant financial shock” that would create “a whole bunch of economic, financial, political and also geopolitical uncertainties”.

By the end of trading, the FTSE 100 index was down 2.6%, or 156.5 points, and below 6,000. The FTSE 250, the next tier of companies and more closely tied to the UK economy, was down 7%, coming on top of a 7% fall on Friday.

“It’s been another dramatic day of trading on the UK stock market,” said Laith Khalaf, senior analyst at the financial firm Hargreaves Lansdown.

Companies likely to be impacted by a Brexit-induced recession were hit hard. In two days, about £40bn has been wiped off the value of banking stocks and £8bn off housebuilders. At one point, shares in the bailed-out Royal Bank of Scotland plunged 25%, while housebuilders such as Persimmon and Taylor Wimpey have lost more than 40% in just two trading days.

Michael Hewson, chief market analyst at CMC Markets, said while Osborne’s statement had been measured his comments “were unable to prevent the feeling that UK politics remains in a state of paralysis, with no clear contingencies in place to deal with the fallout of a leave vote”.

The biggest faller in the FTSE 100 was short-haul airline easyjet, which plunged by 22%*after warning that wary consumers would now rethink their travel plans. Exchange rate movements, the carrier added, would add £25m to costs.

Another profit warning came from the London-focused estate agent Foxtons. Its shares dived 25% after it said Brexit would hit sales for the rest of the year. Shares in so-called challenger banks such as Virgin Money were also pummelled.

Osborne spoke after it emerged that the Bank of England governor, Mark Carney, had*cancelled a trip to Portugal*to remain in the UK to oversee any response from Threadneedle Street.

The Bank’s financial policy committee, set in the aftermath of the financial crisis to look for threats to stability, will meet on Tuesday, when the Bank of England will again offer emergency loans to banks as part of its Brexit planning.

The fallout from the vote is being felt around the world. Italy’s main index fell 4%, extending Friday’s record losses of 12.5%. In Germany and France there were losses of 3%. At the time of the London close, on Wall Street the main share indices were all down more than 1%.

The chancellor may have taken some comfort from the fall in yields on 10-year government bonds. Yields on these gilts, which move inversely to prices, fell below 1% for the first time. This fall in gilt yields will keep government borrowing costs down and lead to lower mortgage rates. However, they also mean*pension companies have started cutting the amount paid to the newly retired.

Osborne refused to repeat his pre-vote warning of a Brexit recession, saying only that the economy would face “adjustments”. But analysts started to cut their forecasts for UK growth. Goldman Sachs, forecasts just 0.2% growth in 2017, down from 2% predicted previously.

The consultancy Oxford Economics said interest rates could be slashed to 0% within weeks. Morgan Stanley analysts said European and UK stocks would fall up to 10% over the coming months and sterling would fall to between $1.25 and $1.30.

So far so good lads, all of this stuff is just a series of unfortunate coincidences and we'll more than make up the deficit in St George Cross flag sales over the next month anyway, plus The Queen is going to have a chat with the Commonwealth about some awesome trade deals where they just give us free stuff and I heard that we're repatriating the colonies next Tuesday. Then they'll upgrade us to a new credit rating that doesn't even exist yet, because it's so good that no one else has it. BrexTHAT, sucka.

[GiRTh]

When are we all gonna be rich? When are we gonna be dictating to Europe?

[user104658]

Originally Posted by GiRTh

When are we all gonna be rich? When are we gonna be dictating to Europe?

Prince Harry is going to do that, he's currently in Japan trying to trade in his pokemon cards for scraps of offal but apparently no one there will buy from a Brit . Dunno what that's all about, another coincidence probably.

[GiRTh]

Originally Posted by Toy Soldier

Prince Harry is going to do that, he's currently in Japan trying to trade in his pokemon cards for scraps of offal but apparently no one there will buy from a Brit . Dunno what that's all about, another coincidence probably.

So many coincidences recently.

[T*]

Originally Posted by Toy Soldier

Prince Harry is going to do that, he's currently in Japan trying to trade in his pokemon cards for scraps of offal

-sniff sniff-
I SMELL RACISM

[arista]

Yes From AAA

to AA

Sadly

[jaxie]

It's been 3 days, give it some time. It will settle down.

[GiRTh]

Originally Posted by jaxie

It's been 3 days, give it some time. It will settle down.

How long six months, six years, sixty years? No ones got any kind of a clue.

[Ithinkiloveyoutoo]

Originally Posted by GiRTh

How long six months, six years, sixty years? No ones got any kind of a clue.

2 centuries

[T*]

but yes y'all need to calm down and watch it settle down rather than jumping to conclusions and acting like you're on a moral high ground for thinking that the country is going to crumble

[GiRTh]

Originally Posted by Tom*

but yes y'all need to calm down and watch it settle down rather than jumping to conclusions and acting like you're on a moral high ground for thinking that the country is going to crumble

Again the question no one can answer - How long before it settles down?

[user104658]

Originally Posted by GiRTh

Again the question no one can answer - How long before it settles down?

Best to leave it open. Then when it takes 5 years, they can say they meant precisely 5 years.

[GiRTh]

Originally Posted by Toy Soldier

Best to leave it open. Then when it takes 5 years, they can say they meant precisely 5 years.

The fact no one has any kind of clue is quite worrying to me. These were the promises made yet now no one wants to commit to any kind of timescale.

[T*]

Originally Posted by GiRTh

Again the question no one can answer - How long before it settles down?

Exactly- no one knows.
So lets give it a chance. IF thing do start going tits up further along the way, that's when we panic.

[Ammi]

Originally Posted by GiRTh

Again the question no one can answer - How long before it settles down?

..until we can get a paddle for the creek I reckon...thing is atm, all of the paddle companies are only trading with the 3star people...

[Ammi]

...someone just took the demo out of democracy ..this is now the full product and not looking as great as advertised...

[Ammi]

..thing is, we're not Great Britain unless we're perceived as Great..that was our strength, that vote of confidence in us and the reason for our credit rating and now it's a vote of no confidence from the world at a time when we had to be believed in.../when it was all important to be...and it's ok saying give it time/it all has to settle etc...but these first days and that confidence was extremely important because it set our path, which we atm don't have..and some people don't have time...some people, financially and possibly quite literally just won't survive this inevitable recession so we get weaker and weaker...and it's also an elitist thing now because it's the very vulnerable this will effect so much...

[arista]

Originally Posted by GiRTh

Again the question no one can answer - How long before it settles down?

Girth
so far Estimated 14 days


The Problem for all Firms
is they "Advanced Invested" in a Remain Contracts
(meaning they were told the UK
would Win a Remain EU)

South Africa is finding it Hard , at the min


Ref: Bloomberg , CNBC , BBC Business Report,
SkyNewsHD Business, FoxNewsBusinessHD,
Radio 5 , LBC.

[jaxie]

Originally Posted by GiRTh

Again the question no one can answer - How long before it settles down?

How long is a piece of string?

[AnnieK]

Originally Posted by jaxie

How long is a piece of string?

Surely that's the problem though.....that string could be longer than our shaky economy can stand.....

[jaxie]

Originally Posted by AnnieK

Surely that's the problem though.....that string could be longer than our shaky economy can stand.....

Divorce is not easy, it was never going to be a walk away and everything is rosy the next day. There was always going to be a period of adjustment. The PM resigning has delayed negotiations. We aren't going to tank, it's just panic and scare mongering.

[arista]

Originally Posted by AnnieK

Surely that's the problem though.....that string could be longer than our shaky economy can stand.....

Yes Shaky.

But Firm.

Once we get all the Investments Sorted
we can Move On.


We are still Paying Motha Fecking Europe
so for 2 years we are still good for projects.


If the French EDF/ China Backer
wants to pull out of our New Nuke Station
fecking Say So.


Put Your Cards On the Table.

[Kizzy]

Originally Posted by Tom*

but yes y'all need to calm down and watch it settle down rather than jumping to conclusions and acting like you're on a moral high ground for thinking that the country is going to crumble

How is having a concern about economic stability moral?...

[armand.kay]

Originally Posted by Tom*

but yes y'all need to calm down and watch it settle down rather than jumping to conclusions and acting like you're on a moral high ground for thinking that the country is going to crumble

Think people would be more calm if we had the slIghtest clue what the plan moving forward is intead of just "it's gonna settle down". We're just being presented with a lot of problems stemming from the referendum results and no solutions.

[Rob!]

Originally Posted by Tom*

but yes y'all need to calm down and watch it settle down rather than jumping to conclusions and acting like you're on a moral high ground for thinking that the country is going to crumble

When we start getting even a single scrap of evidence that the country isn't going to crumble then maybe we'll be more optimistic.