‘Run on UK’ sees foreign investors pull $1 trillion out of the City

[seanm123]

A silent $1 trillion “Run on Britain” by foreign investors was revealed yesterday in the latest statistical releases from the Bank of England. The external liabilities of banks operating in the UK – that is monies held in the UK on behalf of foreign investors – fell by $1 trillion (£700bn) between the spring and the end of 2008, representing a huge loss of funds and of confidence in the City of London. Some $597.5bn was lost to the banks in the last quarter of last year alone, after a modest positive inflow in the summer, but a massive $682.5bn haemorrhaged in the second quarter of 2008 – a record. About 15 per cent of the monies held by foreigners in the UK were withdrawn over the period, leaving about $6 trillion. This is by far the largest withdrawal of foreign funds from the UK in recent decades – about 10 times what might flow out during a “normal” quarter.


http://www.independent.co.uk/news/bu...y-1639413.html

[Mega]

Re: ‘Run on UK’ sees foreign investors pull $1 trillion out of the City

http://uk.reuters.com/article/merger...rsNews&rpc=401

Mike

[Mega]

Re: ‘Run on UK’ sees foreign investors pull $1 trillion out of the City

http://www.guardian.co.uk/business/2...uk-bailout-gdp

Do let me know when you seen enough.
Mike

[cjppjc]

Re: ‘Run on UK’ sees foreign investors pull $1 trillion out of the City

Ok. I give up. I've had enough.

[hayekvindicated]

Re: ‘Run on UK’ sees foreign investors pull $1 trillion out of the City

The question is: if you are a UK retail investor, how do you short Sterling? If you do it from the UK, the way to do it would be by way of a spread bet. This, however, is a flawed way of shorting the currency because: (1) your spread bet account would be in the UK; (2) for every point you earn in the spread bet, you get paid in ££££; (3) this does nothing whatsoever in the event of capital and exchange controls.

The perfect scenario would be to have a brokerage account offshore and short it against the Dollar with the Dollar being the settlement currency. Sterling's demise will precede the Dollar because it is a much more vulnerable currency.