Currency moves cost small biz dear Small business owners in the UK blame currency movements for threatening their ability to export goods - or at least to export goods profitably. A survey of 365 business owners by the Forum of Private Business found 63 per cent said currency movements are a restriction on overseas trade. Just 31 per cent complained about …
... like using the same currency of the countries where 80% of the UK trade occurs? Oh no, let the banks enjoy their fees and commissions and funny exchange rates everytime you deal with the rest of world....
Maybe... once the small biz owners stop subscribing to the Tory vision of the world.... they will realise how much they lose being out of the Eurozone....
http://strangemaps.files.wordpress.com/2008/05/toryatlasoftheworld2.jpg
"Small business owners in the UK blame currency movements for threatening their ability to export goods - or at least to export goods profitably."
If they could not export goods profitably with the GBP at record lows over the last few years, then they are doomed, regardless of what/how they hedge.
The company that paid for the research is in the FX business and can apparently offer the sort of currency management services promoted^H^H^H^H^H^H^Hdiscussed in the article. There's a surprise :-)
To most SME's unless you are already experienced, don't hedge. Occassional currency losses are the norm and if you get your exchange rate right, should not be too bad. Hedging is for the serious trading companies, such as airlines, major exporters/importers. Some airlines lost vast amounts of money last year, because the hedged currency at the wrong time.
As a small business which "exports" most of its business (as the UK no longer invests in technical know how) I feel obliged to point out that a weak pound is exactly what we want. Roll on parity is all I can say. The Pound going down mean UK income going up. The fact that the Euro is also going down the tubes is how ever bad news. Fortunately most of the world prefers to do business in USD which at the moment is going up in value compared with Stirling.
Export or Die.
Yeah right.
Because no-one in the Euro-zone will suffer for what the Greeks have been doing.
Different currencies are essential to allow governments to control things. If you don't control the purse-strings, you control very little and different currencies help insulate the policies of one government from everyone else. Though obviously, this insulation is not complete!
The sensible and economically efficient thing to do is to have a global dictatorship. However, we tend to value self-determination too. Democracy is one way to help government reflect the will of the people and provide self-determination. As democracies get larger however, the value of your vote is proportionally reduced, so while it may still be "democratic" it doesn't allow self-determination because of the push to "harmonise" laws, i.e. differences are erased.
There may be a strong push from business to homogenise people into standardised consumers, but people are different and these differences are often broadly reflected by ethnic and national boundaries. It makes sense to localise financial requirements and planning along these boundaries as well.
This isn't an EU-only issue. While we may decry censorship, Google's declaration that it will try to leverage international treaties to override national sovereignty is equally disturbing, regardless of the good outcome.
I'm not even sure why the newspaper article has come out now. I haven't checked recently, but from a balance of payments viewpoint we probably need to export more. The massive drop in value of Sterling will have provided an enormous boost to exporters and discourages imports.
That wouldn't be possible if we were inside the Eurozone.
You're still missing the bigger picture.
There is only so much money in the world. No amount of pretending different (e.g. lending out money that isn't yours to lend and keeping your debtors one repayment ahead of your creditors; lending money to people who can't pay it back and repossessing the property once it has appreciated in value; or lending out money that isn't yours to lend to people who can't pay it back and so causing a credit crunch) will change that. If you appear to have got richer, it's because other people have got poorer.
If I was "king of the world" I would abolish capricious currencies, and measure the value of everything in kilowatt-hours. And if it hurt at first, then that would be because we've been winning by cheating. The poor aren't going to get any richer without the rich getting a little poorer.
I earn my wages in euros, I can buy stuff from British Amazon because, even with shipping, it can work out cheaper than the French version (where the maximum discount permitted by law seems to be about 5%). All thanks to the crap value of the pound.
That said, I don't get the ranting nutcases (aka "tories") who think the world will end if the currency doesn't have a picture of Her Majesty on it. It is a piece of paper which is exchanged for goods. I'm not fussed if it has pictures of bridges, pictures of pyramids-with-floating-eyes, pictures of an old lady, or pictures of a penis. As long as it has an intrinsic value which remains reliably constant, it can *look* like whatever it wants. And as for credit cards and bank accounts, it's all just a bunch of numbers. The numbers matter, the name less so. Call it whatever you like - I just got paid a couple of thousand pounds/dollars/yen/euros/playmobil currency units! :-)
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