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[Teneb]

If we do get independence, and don't [get to] keep the pound, it is my hope that we'll call our new currency "Credits" just so we can sound more futuristic than the rest of the world.

That is a horrible idea as most economists would tell you. Imagine saying you have 100 credits in credit.

[Biowraith]

If we do get independence, and don't [get to] keep the pound, it is my hope that we'll call our new currency "Credits" just so we can sound more futuristic than the rest of the world.

That is a horrible idea as most economists would tell you. Imagine saying you have 100 credits in credit.

Now I just want it even more.

[Leafsnail]

I really hope that there are sensible negotiations if the result is Yes rather than the petty attempts to punish Scotland that have been threatened.  It probably wouldn't be too disruptive if we could have a currency union, free movement between the countries, free trade etc.

[mainiac]

If we do get independence, and don't [get to] keep the pound, it is my hope that we'll call our new currency "Credits" just so we can sound more futuristic than the rest of the world.

That is a horrible idea as most economists would tell you. Imagine saying you have 100 credits in credit.

Well clearly that just means you need to eliminate credit markets entirely and go completely digital.  The central bank would be the only bank and could chose to pay positive or negative interest as it sees fit to maximize national output.  Futuristic name and futuristic economics!

[scriver]

Well, the Scandinavian countries all call their currency the Kroner, right? Nothing wrong with using the same name as the pound.

No!

We Swedes call ours Kronor.

The feeling your experiencing right now? That's just the wind from our overwhelming rebel spirit and going-again-the-stream attitude.

On a serious note, a cool name would be whatever "dale/valley" is in Scottish. Glen maybe? I'm not sure what actually makes a glen, other than awful parents who hate their children and want them to be bullied for their name forever. That way they would have literal Scottish Dollars.

[Mictlantecuhtli]

There is no question Scotland would need another currency.  It sounds like a lot of effort to the layperson but that's because people just take it for granted that economists do their jobs and get exchange rate equilibrium pretty much right.  Staying on the pound would be ignoring that.

We actually have a fantastically good example of the difficulties of changing to a new currency vs. the difficulties of having your currency price not reflect your labor markets.

Remember when the Euro was adopted?  A lot of work, some of it expensive.  But really a drop in the bucket.  That's how hard it is to adopt a new currency.
Look at Spain right now.  Their currency can not adjust to reflect their labor markets.  Look at the unemployment.  Look at the huge drop in national output.  That's the scale of problem we are talking about when currency prices dont reflect labor markets.

Ask yourself, whose problems would you rather have, Spain around 2000 or Spain today?

(Of course the problem can also go in the opposite direction as well.  If Scotland beats productivity in England then Scotland will have spiraling inflation problems until that inflation eats into incomes enough to balance the national account.  There aren't as good examples of that (thankfully) but you can look to the recent inflation problems in China until they adjusted the exchange rate as somewhat similar).

So, I assume you feel the same way about all EU countries that have accepted the Euro as a currency? You picked a boogeyman called Spain and failed to note that it's the second worst example in a bunch of under-performing economies. You might be surprised to find out Europe's economy is shit and if your country doesn't know how to manage a simple crisis it might implode on all it's leveraged assets. Spain just is taking longer to fall apart than Greece, thanks to mismanagement. I'm not sure how you can claim that changing their currency is the reason why Spain is a under-performer of under-performing economies. Mind explaining to the laymen how Germany hasn't fallen apart after adopting the Euro? Might it be that national policy and ability to govern has a hand in currency transition?

Or are you saying Scotland should make up a new currency with all the 'equilibrium' that will bring to their post-independence currency, ignoring the confidence issue? Or that they should just directly go to Euros? Because they have a lot of previous playbooks to go by, I'm not sure why you're so pessimistic on Scotland's post-independence integration into the Europe and world economy.

[mainiac]

So, I assume you feel the same way about all EU countries that have accepted the Euro as a currency?

Precisely.

The EU deserves a little bit of slack because it wasn't understood before hand that the ECB couldn't (or wouldn't) serve in the same role for eurozone economies.  There was discussion of the risk of imbalances but it wasn't anticipated the imbalances could get this big.

And blaming the Euro stagnation on mismanagement is just plain wrong.  Yes mismanagement can happen but that's not the story the data tells.  When we look at inflation in the Euro before and after the crisis, when we look at sovereign debt risk with countries like Spain compared to places like Ukraine or when we look at the effects of ECB open market interventions there is just mountains of data that says this is a classic monetary failure full stop, end of story.

If this was a story of spain being irresponsible then Spain would already be done fixing itself by now: http://fsaraceno.wordpress.com/2014/09/11/labour-costs-who-is-the-outlier/

The Euro crisis was horrible but hard to predict.  For Scotland to chose to go down this path after seeing the Euro crisis is too dumb to live territory.

And it's not like countries like Germany did well either.  They have full employment but it has come at the cost of reduced buying power.  And most Germans dont work in export oriented industries which benefit.  German hairdressers and taxi drivers and schoolteachers are subsidizing the wages of steelworkers and bankers.  That is not an optimal result for Germany.

Or are you saying Scotland should make up a new currency with all the 'equilibrium' that will bring to their post-independence currency, ignoring the confidence issue? Or that they should just directly go to Euros? Because they have a lot of previous playbooks to go by, I'm not sure why you're so pessimistic on Scotland's post-independence integration into the Europe and world economy.

I am saying that Scotland has no other choice.  I am pessimistic because they are currently in reality denial mode.  It's all very well and good to have previous examples to go by but it accomplishes bugger all if you ignore those examples.

[WillowLuman]

Meanwhile, the Welsh say "Don't leave guys! The English MPs will just have an even larger majority!" Except for the nationalists, who believe England may be more willing to give more powers back to Wales and NI if Scotland leaves.

[XXSockXX]

Owlbread, I hope you get to enjoy the day you've been waiting for. Whatever happens, you'll probably be busy, either celebrating or starting to prepare for the next vote, say in 3 years. 

I'm still unsure what the best possible outcome of this will be, so I hope whatever the Scots decide will work out fine for everyone.

[penguinofhonor]

It seems like this vote only happened because people assumed it would fail. I'm not sure if there'll be another chance that soon.

[pisskop]

It seems like this vote only happened because people assumed it would fail. I'm not sure if there'll be another chance that soon.

yea I think its like the NK bit and America.  Go Korean War!  Our armies were our voice!  Democracy was upheld!

[Orange Wizard]

I'm only assuming the vote will fail because the House of Lords will probably just be like "Well, you know, we were just kidding. You're not independent after all! Haha! Funny joke. Got the Scots really riled up with that one, didn't we?"

And then they'll go giggle and drink tea as they rake in money.

[Fniff]

So, does anyone else think that David Cameron has committed political suicide over this?

[penguinofhonor]

yea I think its like the NK bit and America.  Go Korean War!  Our armies were our voice!  Democracy was upheld!

You're right, we should turn this into the next Korean War. Imagine the American intervention! I'm sure the Scots would be happy - we could teach them a thing or two about throwing off the shackles of English tyranny. Then Russia could back England and we could fight a proxy war on British soil. It would be great!

Also I bet there is a lot of tea in England to throw into harbors. I'm not saying America would still do that, but we do have a political party named after it.

[FearfulJesuit]

With perfect timing, Clickhole considers the costs and benefits of sending freedom.