It’s not practical for an independent Scotland to keep the pound, says George Soros
Billionaire George Soros has said this morning that it wouldn’t be “practical” for an independent Scotland to keep sterling, but that a separate currency is “potentially dangerous”.
Speaking to ITV's Richard Edgar, Soros said Scotland should seek membership with the European Central Bank – i.e. join the euro – because sticking with the Bank of England wouldn't be feasible. Scotland would have a "very difficult" relationship with the rest of the UK if it tried to keep the pound, he added.
But writing for City A.M. today, Avinash Persaud argues conversely that there's "nothing stopping an independent Scotland" from declaring sterling sole legal tender, and borrowing it on the financial markets to hold in reserve – it doesn't need permission from the rest of the UK to do either.
Indeed, for an independent Scotland to succes, it needs fiscal responsibility, insists Persaud.
EU might not survive
Soros has also been giving his two pennies’ worth on the state of the European Union. There's a need for businesses to speak out: the UK leaving the EU would mean multinationals that've set up here because of access to the EU should “explain what they would lose… in a word, jobs”, he said.
He told the BBC this morning that the EU may not survive the current “long-lasting stagnation”, and that Germany’s responsible for many of the problems on the continent because it hasn’t assumed a leadership role.
My hope is that Germany is going to change and realise that the policy of austerity is counter-productive. Their memory is inflation, so they continue fighting inflation when the threat is deflation.
The only people who can change it are the Germans, because they are in charge. They don't want to be in charge, in fact they are determined not to be in charge. And that's the tragedy.