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Comment by christophilus | Hacker News Reader

The Euro and Yen and almost all currencies are also down significantly vs the dollar, so I don’t think this is a Brexit thing. This is a strong US dollar thing as the world grapples with collateral shortages and a relative dollar shortage.

Edit: I highly recommend the podcast “Eurodollar University” on the subject.

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But the GBP is down on all those currencies, too. Whatever other countries are experiencing, the U.K. is getting it double.

In the last 60 days, the GBP has slid from 1.20 EUR to 1.09 EUR, fwiw. It definitely looks like something other than a strong dollar.

EUR sliding against USD as well, right?

Yes which implies the pound is sliding against the dollar significantly faster than the euro, at least the last 60 days.

So almost 10% drop relative to the Euro in addition to both of them falling against the dollar. I wonder what's behind that particular weakness for the pound.

The government just announced tax-cuts backed by borrowing, so likely to increase inflation even further.

But isn’t inflation usually an effect that happens after such an event, rather than something that’s being speculated on?

Unless large institutions decided to sell their pounds, but that has to be a huge supply of pounds to make such an impact.

People with money don’t wait for it to become worthless…

If you can reasonably expect something to be worth less in the future after new information emerges, wouldn't you sell it and buy something else?

Brexit plus a completely bonkers set of tax cuts. The UK will vastly increase borrowing, to give a tax cut to high income people. The markets are unimpressed.

I'll admit I thought this was the kind of thing that impressed the markets? (or at least the people who make the market turn the way it does)

On the other hand the USD is also nearing a really high value relative to CAD

Wow, finally someone that I find on a web forum also willing to utter the words "dollar shortage" during this time.

Big props to Jeff and Emil for their generous freely available teachings. I further recommend their paid subscription too. It's well worth it.

These times are easy to see coming if you had the right monetary lens on.

Ok, so what happens next then?

Continuing a globally rough pace of growth until economists wake up and remake the broken monetary plumbing system.

Cheers to that! I'm super hopeful that the next thing the economists do will totally smooth things out, for good this time.

The market is going to go down a little more, then way up.

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