UK and pounds

[kikie]

Last week I ordered some pc items from England and I was able to wire the money directly onto the seller's bank account.

The parcel has been sent using the services of Parcel2Go. According to the tracking number, the parcel has arrived at the Brussels EMC. I started reading about this EMC thing and read that there are many people whom have to pay custom taxes. But I guess because the UK is part of the EU, I won't have to pay any additional taxes.

This got my thinking hence this thread.

Why is the UK still using £ instead of €?


Let me know if this is in the wrong forum and I will move it to the rumple strip.

 

[Omnis]

Because € is crap?

 

[maximumattack]

That's a fair point & well made Omnis

The pound isn't as strong as it used to be though, a few years ago I could get about €1.4 to the £ now it's only about €1.2.

Saying that at least that's an improvement on the almost 1:1 exchange rate I got at the beginning of last year

 

[DK]

I think the use of £ instead of € is because the UK wants to retain control over interest rates, exchange rates, and also because the £ is becoming some sort of symbol of the UK's individuality. For example, the £ sign is part of the UKIP logo.

 

[Sureboss]

Lol at the idea of something being a part of the UKIP logo having any sense of significance in why we stay with the Pound.

 

[Sniffs]

the US dollar's fallen off the board. SOMEONE'S gotta set a monetary standard

I don't think the british have ever thought of themselves as "european", but only as British.

 

[kikie]

A few weeks back, there was a rumour that Belgium was going to use the Belgian Franc again. I was pleased to hear that but as I said, it was only a rumour.

 

[Dotini]

Don't look now, but the rumor is that the Greeks will go back to the drachma and the Germans to their beloved mark. All of Europe stands at the precipice of unraveling. Continent isolated by channel fog?

 

[lpb-nissan-gt-r]

We as a country need our own intrest rates as it is not similar to a country like germany as most people own there houses and if we where to join we would be constantly in a recession.

@maxium Attack believe it or not it is actually better for our economy if the exchange rates are lower e.g. 1 pound to 2 euros as our exports increase as prices are cheaper for european countries. but it is not good for people who want to go on holiday abroad.

 

[Seismica]

@maxium Attack believe it or not it is actually better for our economy if the exchange rates are lower e.g. 1 pound to 2 euros as our exports increase as prices are cheaper for european countries. but it is not good for people who want to go on holiday abroad.

It does not matter one bit what the current exchange rate is.

What matters is how it changes. If the £ reduces in value in relation to foreign currencies, UK companies become more competitive in domestic and foreign markets and vice versa.

An Example for those who don't quite understand:

A luxury car manufactured and developed in the US sells for $90,000. Let's say the value of the dollar is 1.5, so in the UK it would sell for £60,000.

Let's say a luxury car manufactured in Britain, was also £60,000 (and therefore $90,000 in the US).

If the exchange rate changes to 1.6 (The pound increases in value and/or dollar decreases) then the price of the US made car in the UK becomes £56,250, and the price of the UK made car increases to $96,000 in the US. Ignoring all other factors, it means the UK company becomes less competitive in both the UK and US markets.

If the exchange rate changes to 1.4 (The pounds decreases in value in relation to the dollar) then the price of the US made car in the UK increases to £64,286 and the price of the UK made car decreases to $84,000 in the US. Again, ignoring all other factors, the UK company becomes more competitive in both countries. UK exports increase etc.


Though... I dropped out of my course at University before we ever looked at £ versus € I don't know how this argument applies.

 

[Keef]

Probably because the UK has some semblance of sovereignty and national pride.

But this is a good question: Why did and why did they decided to call it a pound?

 

[Famine]

240 predecimal pennies weighed 1 pound (and that was through tradition - I believe the origins of our currency were back in the time of Charlemagne (~8th Century) and we copied his system of 240 pennies to 1 pound.

 

[Smallhorses]

240 predecimal pennies weighed 1 pound (and that was through tradition - I believe the origins of our currency were back in the time of Charlemagne (~8th Century) and we copied his system of 240 pennies to 1 pound.

Funnily enough, I'm reading a book at the moment that's called "True Brits" and one of the chapters is about some of the ceremonies performed by the "Queen's Remembrancer" and it talks about the "Trial Of The Pyx", a ceremony still performed annually at Goldsmith's Hall in London. Each year a selection of coinage from the Royal Mint is collected from each batch (including some New Zealand coins still minted in the facility at Llantrisant) and is measured for weight against set of standard plates to ensure uniformity throughout the batches and across different denominations.
It was important in the older days when precious metals were used to mint the coins themselves to ensure that the people in charge weren't producing underweight coins and pocketing the leftover gold or silver.
Nowadays in the realms of computerised weighing and cupro-nickel coins and such like, it's not so much of a worry as the coins don't actually contain any precious metals (except for a few commemorative coins), but like so many great British traditions, it's still performed with all the pomp & circumstance that it originally had.

It mentions, that in the 13th century it was determined that (as Famine has mentioned) 240 silver pennies weighed the equivalent of 1 Troy Pound of Sterling silver. (and it's important to distinguish between what we use daily as lb. & oz. versus the Troy measurements.)

Also from Wiki:

The troy system was the basis for the pre-decimalisation British system of coinage introduced by Henry II of England, in which the penny was literally one pennyweight of silver. One pound sterling was equal to twenty shillings, with each shilling equal to twelve pennies. Thus, one pound sterling equals 240 pennyweights, or one troy pound of sterling silver.

 

[Sniffs]

Famine: try explaing the Shillings and Pence system, though, to people who didn't grow up with it. the scary part is translating prices in reruns of something like Are You Being Served into todays money. how the heck do you live off of "19 quid a week" thank god it's all in decimal. it was bad enough translating 2d 11p 3f in one episode (15p)

 

[ExigeEvan]

It's just Britain's way of being socially awkward, just like our lack of ability to speak foreign languages.

 

[Sureboss]

No, we try and class Welsh and Cornish as foreign languages.

 

[dxm8975]

I don't think the british have ever thought of themselves as "european", but only as British.

I think so, too. They don't suppose themselves as "Europeans", though the UK is a part of Europe.

And as for the UK pound, I'm not sure about why the UK pound is still used instead of Euro that is generally used in the european area, but as driftking said, that may be because the UK can maintain their control by continuing using the currency, and it's practically becoming a symbol of the UK country.

 

[Blitz187]

Because € is crap?

Yeah, Thanks to Greece and Hungary.... YAY!

 

[dxm8975]

Yeah, Thanks to Greece and Hungary.... YAY!

Though actually I've been to France once and used the european Euro, I felt it was difficult to use effectively when I browsed some shopping stores there, the UK pound was much easier!

 

[Stevisiov]

Though actually I've been to France once and used the european Euro, I felt it was difficult to use effectively when I browsed some shopping stores there, the UK pound was much easier!

What was difficult about it? It works in much the same way.

 

[TheCracker]

Though actually I've been to France once and used the european Euro, I felt it was difficult to use effectively when I browsed some shopping stores there, the UK pound was much easier!

It should have been easier for you really. Or would have been if the exchange rates were as they are now. A Euro is currently worth almost 200 Yen. A Pound is 136 Yen.

 

[dxm8975]

What was difficult about it? It works in much the same way.

I needed to pay more than I did with the pound, the articles sold at the shops costed higher in the european euro.
So I had to spend it carefully not to run out of it.

 

[LizMcQueen]

Why is the UK still using £ instead of €?

because they are very stubborn (example, they still drive on the left) and don't know how to play as a team

 

[TheCracker]

We play as a team, but just to our own rules.

Driving on the left makes sense. With cars that are LHD drive, when you change gear you are steering and therefore controlling the vehicle with your less co-ordinated hand (with a majority of people being right handed).

 

[dxm8975]

It should have been easier for you really. Or would have been if the exchange rates were as they are now. A Euro is currently worth almost 200 Yen. A Pound is 136 Yen.

Yeah, the UK pound was closer than the Japanese "Yen" in value, I could use it like I usually use my own country's currency in Japan.

 

[Seismica]

example, they still drive on the left

We did it (officially) first, therefore we are right

Highway Act 1835

I think that's the first country-wide law in the world about the side of the road you have to be on. In the US it was unwritten. If we use Formula One as an example, unwritten rules are not valid.

We have no need to change to right hand drive, as there are no borders we can cross that would require us to switch to the right side of the road.

Also, science agrees with me :

http://en.wikipedia.org/wiki/Driving_on_the_left_or_right#Safety_factors

 

[Vince_Fiero]

No sense in this thread till now. Kikie deserves a bit more reason (says the boring man).

Adhering to the EUR means that you put the mechanisms of money supply and interest rate decided by the person bringing out the Money at EU level.
This actually means as a country you have less influence on the economical effect of monetary actions, how they stimulate your economy, how they work on inflation etc...

On top of that some of the weaker participants in the currency (like the UK would be with a 12% deficit?) could endanger the whole EURO zone.

I think the statement of the predecessor of "Iron Man", so his mum the "Iron Lady" once stated, if the EU gives us our money back (bigger countries seem to contribute more proportionally to the EU) we are ready to get more involved in the EU.

Conclusion: to get the UK in the EURO zone (=loss of independent money policy), we have to give them the money back, which would solve their deficit and actually stabilize the EUR currency as a whole.

But macro economics are not simple I fear and some side effects are possible on my above analysis.

 

[Dotini]

http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100006271/the-euro-mutiny-begins/

The Euro mutiny begins.

 

[homeforsummer]

Rumour has it that France will be one of the first countries to move back to their old currency.

It's interesting when you go to France because there's not a single shop where the price of something isn't still listed in Francs as well as Euros.

 

[Robin]

The Euro was never designed for a disaster like this, thank goodness the UK is still on the pound. I think it would be a great idea for all EU countries to go back to their currencies, that way they can devalue the currency if needed.

Robin.