Im posting this in the full expectation of further vitriol and jibes from committed members of the No camp (and perhaps also from some Yes voters) An Adam Smith Institute report has today concluded that, given the refusal of George Osborne and other UK politicians to countenance a currency union between rUK and iScotland in the event of Scottish independence, an independent Scotland should go for sterlingization - which means adopting the pound sterling as its currency or a currency pegged to sterling, but without a currency union and without the Bank of England as lender of last resort. The ASI says this would, among other things, enable an independent Scotland to return to a freer, more stable banking system. The report says that sterlingization, combined with reform of Scottish financial regulation that: -removed government liquidity provisions to illiquid banks, -established mechanisms to ‘bail-in’ insolvent banks by extending liability to shareholders, and -shifted deposit insurance costs onto banks and depositors rather than taxpayers, would improve standards and competitiveness in banking, while significantly reducing the prospect of large-scale bank panics and financial crises. Seems very interesting. adamsmith.org/blog/money-banking/an-independent-scotland-should-use-the-pound-without-permission-from-ruk/
Posted on: Thu, 21 Aug 2014 13:03:14 +0000
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