A weaker pound is not necessarily to be feared: this rebalancing is long overdue + our exporters / tourism loves it

The pound has dropped in value. What does this mean and is it a good or bad thing, in the short medium and long term? 
There are both benefits and burdens to Brexit, but what is undeniable is that it is a shock and it causes a reassessment of our currency as compared to other currencies. This has caused a devaluation of the pound as compared to the dollar, the euro and other currencies. This has consequences. Some are not good. For example, imported goods like overseas fuel or non British food stuffs get more expensive. This is the origin of the Marmitegate crisis last week - and we will see some foodstuffs get more expensive in the shops if those shops are importing the produce. 

If you are trying to export your manufactured goods you love the depreciation in the pound. Suddenly your goods are that much cheaper and more competitive. 
Similarly look at tourism: if you run a home grown bed and breakfast or a hotel then the devaluation of the pound as compared to the dollar or the euro is wonderful news. Your product - the great British holiday - is now a lot more attractive to overseas visitors. 
But if you are going on a European or American mini break then your pound buys less dollars or euros. Your holiday abroad got more expensive. Which means many families, I predict, will choose to staycation in the uk next year. Which boosts our uk tourism, hotel, pub and b + b

But don't take my word for it. The guardian is no friend of Brexit, but yesterday it did this assessment of why the pounds devaluation is not to be feared: it is a view. But whilst the jury is out in the future that Brexit holds the reports from business of the consequential devaluation of the pound is that fundamentally it is a good thing. 

A weaker pound works by making exports cheaper and imports dearer. The effect, as after all the other devaluations and depreciations of the past 100 years – 1931 to 1976, 1992 and 2007 – will make the economy less dependent on consumers and more reliant on producers. Lord Mervyn King, a former governor of the Bank of England, thinks the latest fall in sterling is a good thing and he is right.
Put the Brexit vote to one side for a second and ask yourself the following questions: 
- is the economy currently unbalanced? 
- Is growth too dependent on consumer spending and asset price bubbles? 
- Is the productive base of the economy too small? 
- Is it a problem that the UK is running a balance of payments deficit worth 6% of GDP, bigger than ever before in peacetime?
If your answer to these four questions is yes – as it should be – then you need to accept that there is an upside to the falling pound. Indeed, many of those who are now talking about a sterling crisis were last year bemoaning the fact that Greece – trapped as it was inside the eurozone – did not have the benefit of a floating currency and so had to use a brutal internal devaluation involving wage cuts, pension reductions and welfare retrenchment to restore its competitiveness.
The current account deficit will shrink as a result of stronger exports from the manufacturing and service sectors, the boost provided to the tourism industry, and because cheaper domestic goods and services will be substituted for more expensive imports. To say that dearer imports will make life more difficult for consumers is to miss the point. That’s how rebalancing works.

Debating Scots referendum impact on the North with SNP on BBC Radio Newcastle at 8.50am tomorrow

I have a radio debate at 8.50am with a SNP rep, and then will be in the House of Commons at 9.30 on the impact of Independence on the North East. I am working with my Labour colleague Phil Wilson on this. The question for me is twofold.
Firstly, as everyone knows I have been campaigning strongly for months for the Scottish people to remain part of the United Kingdom; my hope is that they say an emphatic “No” in the referendum this September. Last year I went to Scotland to knock on doors, and make the case in over 10 public meetings, or events, that we are Better Together. I will do this again this summer.

The second question is how does this affect Hexham and the wider Northumberland community?
It is vital that we south of the Border, who do not have a vote, should understand what is at stake. But more importantly we also need everyone in Northumberland to call, write or visit their Scottish friends, neighbours and families and make our Scottish brethren understand that over 300 years of union should not be thrown away lightly.

Our case is made on two grounds:
- the first is with the heart,
- the second the head.

Speaking for myself, I love Scotland, its people, its wild places, its whisky – this I cannot deny - and so much more. I love the fact that, as one united country, we have defeated everyone from Napoleon to Hitler. I love our United Kingdom, and the successes that we enjoyed – whether it is at the Olympics or celebrating Andy Murray’s historic Wimbledon win. To lose all of this would be tragic.

But whilst this point needs to be made, it is the matters of the head, and the financial consequences of separation, that may sway the day. And this will have a significant impact on us here in Northumberland.
Between now and September it is important that the people of Scotland know exactly what an independent Scotland will look like.

I speak as a Brit, a mongrel Englishman, an ancestor of immigrants myself, a lover of Scotland and a Northumberland MP whose constituency borders Scotland. Were there to be Scottish independence, I have no doubt that tourism and trade would continue, but it would be niave not to accept that cross-border business would be affected. That is not a Northumberland Member of Parliament speaking: that is the opinion of the chambers of commerce, local authorities and business groups I have spoken to on both sides of the border.

The Currency impact will be huge. On what basis would Scotland get to keep the pound? If we do not agree to a formal currency union would it be used informally, just as some Latin American countries, Greece and Montenegro all use other currencies? Why would the Bank of England take notice of Scotland in setting monetary policy? After independence, surely the Governor would only owe his position to a rest-of-UK appointment system? At that stage, Scotland would be the competition not our ally – and we would set our banking and interest rate policies accordingly. The counter - arguments that have been put forward by the SNP are, respectfully, a farce.

These arguments on fiscal regulation might appear dry and unexciting, but they are key to the future prosperity, not only of the whole existing United Kingdom, but especially of an independent Scotland. Such aspects of fiscal regulation - how a bank would function; how a currency would be managed; what sort of interest rates would be managed; who is in charge of such matters - are totally unaddressed by the SNP.
On any economic interpretation independence would be very bad news for Scotland, and would affect the rest of the UK, particularly Northumberland. I urge everyone to phone their Scottish friends and family: tell them to stay with us.

On trade issues there would need to be new trade agreements. Tax rates may differ. Payment systems would clearly differ. All of these things will impact on business and jobs. This cannot be overstated. A single market presently exists between Scotland Northumberland – to lose this will have an impact, and it will not be good.

An Independent Scotland will not be able to keep the pound - its that simple

The Chancellor could not have been clearer in Scotland today. There is and never will be any "legal reason" - or any other reason, why the rest of the UK would want to share sterling with an independent Scotland, as Scottish ministers have proposed.
This analysis was backed by Labour and the Liberal Democrats.
For a report on this read here: http://www.bbc.co.uk/news/uk-scotland-scotland-politics-26166794
What the currency will be Lord knows, and the SNP certainly do not.
To read the debate I was in yesterday where the SNP behaved terribly see here: http://www.theyworkforyou.com/whall/?id=2014-02-12a.292.1&s=speaker%3A24962#g301.3