Rossi: Bank of England's first recovery leaks Britain's weakness to please

Journalists Shi the UK's focus on the continued disclosure scandal of the MPs ' claims door.　　The latest development of the May 25 revelations is that the current Chancellor of the Exchequer, darling, has been dragged into the water. These noises seem to overwhelm the "negative" news about Britain's sovereign rating.　　Last weekend, S & P abruptly announced a downgrade of the UK's sovereign-rating outlook to "negative", warning of a possible cancellation of its more than 30-year AAA credit rating. This is the second round of bad news about Britain's sovereign rating. Since the financial tsunami last autumn, the vast majority of people seem to be inclined to think that Britain is the worst hit country.　　At the beginning of this year, public opinion once speculated that Britain had been plunged into "state bankruptcy" situation. However, Vanessarossi, a senior researcher at the Royal Institute of International Affairs and Professor Rossi of the International Economics of Economic prediction at Oxford University, said in an interview with this reporter that the fact is not the case, because of the "false predictions" of many institutions.　　In her view, there are indications that the UK economy is actually more resistant than many other economies, and that the bank's performance "may have begun to recover".　　She argues that the British government is willing to play the "worst of luck" role in part in order to enjoy the benefits of the sterling devaluation resulting from the economic crisis.　　Why did the "negative" rating outlook and the calm market response downgrade the UK's sovereign rating to "negative"? S & P says it fears the UK government's net debt burden could close to 100% of GDP by 2013. According to the latest statistics, public debt in Britain now accounts for 53% of GDP.　　S & P's previous revised rating outlook eventually led to a downgrade of about 37% per cent, with the Spanish and Irish credit ratings downgraded in January and March respectively. This is clearly a bad news for the British government, which is adopting quantitative easing and trying to make use of the expansion of debt. International investors, only allowed to hold AAA-rated bonds, will be forced to sell gilts, which form about 40% per cent of the UK bond market.　　The loss of a top credit rating would undoubtedly raise the cost of financing the country's treasury debt, which in turn would make it more financially tense. But the odd thing is that the stock market, which has heard enough bad news, has not really reacted much this time, and that after a brief jolt, the index and the exchange rate quickly returned to their original position.　　Shortly after the news came, the UK Debt Authority successfully completed its 2014 5 billion-pound Treasury sale plan, which, according to market participants, was at a "fairly comfortable" level.　　Just minutes before the release, the British government had just disclosed a April public sector net borrowing demand of as much as £ 8.5 billion. According to the UK Treasury budget report released last month, it is expected to borrow 220 billion pounds this fiscal year, almost equivalent to 1 billion pounds a day's debt. At the same time, the Bank of England used "quantitative easing" policies to create money aggressively. Market reviews criticized the British government for borrowing money with one hand,Make money with one hand.　　Britain's economic output has fallen by 1.9% per cent, and household spending in the first quarter of this year has fallen by 1.2%, the sharpest decline in 1980 years, according to a new report by the ONS, with government spending making a positive contribution to economic growth.　　However, in Prof Rossi's view, in spite of last year's views that the British economy was the worst affected by the economic crisis, there are in fact signs that the UK economy is actually "more resistant" than many other economies.　　UK banking recovery?　　Just last week, London's financial markets said that some sovereign funds had expressed interest in the UK government's bank stocks, and that the UK banking sector, supported by the government, was more likely to take the lead in recovery.　　According to people familiar with the UK Financial Investment Agency (UKFI), the UK has had extensive contacts with several sovereign wealth funds and other foreign potential investors to negotiate the sale of its nationalised bank shares and may begin selling some of its holdings within a year.　　The UKFI, established after the financial crisis, is responsible for the government's 70% and 43.5% per cent stake in RBS and Lloyds (Lloyds) respectively.　　This seems to suggest that the market is increasingly thinking that the worst of the financial crisis is over, and that banking has shown signs of getting better. The other good news is that London interbank rates are falling in a row. "The fall in Libor shows that there is less concern about the liquidity of the banking system and is creating a less restrictive lending environment," a report by RBS says, "the excessive fear phase of the credit crunch is coming to an end."　　"Some in the industry believe that the UK's big banks will have a strong profitability once they survive the toughest times," he said. HSBC has just passed the UK's largest rights issue. Insiders say the company's current strategy is to "get over it," and as rivals weaken, their global banking and market operations are becoming stronger, even in unfamiliar areas, such as the euro-market bond-underwriting list.　　One HSBC global investment director, known to the correspondent, said he had been looking for suitable investments around the world because of the risk of a large amount of external capital being diverted to HSBC after the financial crisis.　　Barclays is planning to recruit 65 bankers in the UK, Italy, Germany and France to engage in a European mergers and acquisitions advisory service to enable Barclays to enter the world's top three in all of its investment banking products and sectors, the head of global mergers and acquisitions has said publicly.　　Barclays has so far avoided funding from the UK government, opting to raise capital by offering and selling assets, and its main rivals, including JPMorgan Chase and Goldman Sachs, have received emergency bailout funds.　　Standard Chartered, a strategic focus in emerging markets, also said the bank was operating in a "very good" state, keeping its business growing and profitable. Bank recovery constraint: Loan-to-deposit ratio too high but for the British governmentTo sell the shares to private investors, Chesong, an investment analyst at an international financial insurance group, said that, for the time being, there was no condition.　　First, the British government has made it clear that these taxpayer-bought shares will not be considered for sale until they are profitable, and second, that the current market conditions are not restored to the time when bank shares can be sold to private investors in large quantities.　　UKFI bought shares in RBS and Lloyds at 65.5 pence and 173.3 pence respectively, while the two banks ' share prices are still quite a gap from the above price. Chesong points out that the main problem for the Bank of England is borrowing-deposits are too high and relying too much on wholesale financing (wholesalefunding).　　According to the 2008 annual financial report of Barclays, Lloyds and RBS, the average lending-deposits ratio of these three banks is around 150%. "In addition to HBOS, which has now been merged into Lloyds, the UK banking sector has been generally stable, not because of the vicious competition that led to a sharp drop in spreads, but only to increase the volume of wholesale financing." "said Zhao.　　In his view, the first thing the Bank of England needs to do is to reduce its reliance on wholesale financing and to achieve a balanced development by raising deposits.　　Prof Rossi, who has long studied the issues of international economics and finance, seems to be confident enough to start selling some of the Bank stakes. The UK economy has been "wrongly underestimated" for the past year, experts are happy to push the UK economy and Sterling to the bottom of the economic quagmire, and the UK itself seems happy to play that role, "said Prof Rossi," and any international organization that you see is predicting that the UK has been most affected by the crisis and at the bottom, Few people oppose this, although that may not be true. "The UK has been hit by a heavy blow and the exchange rate has fallen, and the pound is close to 1:1 against the euro by early this year."　　The British Treasury blushes said the fall in Sterling helped the UK economy recover.　　This reporter has also seen more than once in Britain that when it comes to promoting the attractiveness of the UK to potential overseas investors, government officials are always sparing no effort to promote the value of sterling in the UK after the devaluation of the pound. Prof Rossi points out that Britain is being pushed into this role, also because other countries do not want to accept their economies or even face more serious problems. So far, forecasts have had to change the rankings, compared to the severity of the situation in Japan and elsewhere in Europe, where the International Monetary Fund has recently downgraded its economic growth forecasts, and Britain has shifted from the "worst-hit countries" to "moderately affected countries" (middle-of-the-road),　　Britain is no longer the bottom.　　In Prof Rossi's view, this is only an attempt to conceal previous forecasts by rumoured that Britain may be "out of the way" of the recession. Public opinion once hyped the "expert" view that the pound would fall further, but as Sterling began to rise now, commentsThis seemed particularly silent. Now the UK has been taken the lead in the spotlight-shifting attention to increasing the risk of budget deficits and debt in the UK, which in turn involves Britain's AAA-rated financial market position. Prof Rossi says the reasonable judgment is that against the backdrop of an unprecedented recession and a slow recovery, the depth of the UK recession and the serious problems facing the financial sector and the public sector are not to be imagined, and the UK economy has been hit hard and will continue to suffer, but the relative economic losses in the UK could be centered,　　The debt situation may be just like other countries.　　She cited the UK government's debt, which accounts for 53% of GDP, to be lower than most other major economies, such as the US, Germany and France (60%-70% of GDP), far below Japan's 170% per cent of GDP (gross) and 100% (net worth). "While credit rating agencies have been damaged by the reputation of their foolish evaluations in recent years," she suggested, "the British government must also be worth a triple A rating, which, if not dealt with, would be very happy to have the advantage automatically." "In the eyes of Ian McCafferty, chief economic advisor to the Confederation of British Industry, the British government must now launch a clear and credible strategy to Mccarforty the public sector with tough reforms in the public service, without compromising competitiveness and suffocating the fragile recovery."