Talk:Sterling Area
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[edit] Re-write
I've re-written this to remove some rather unrepresentative and parochial examples of currencies leaving the zone and to give a better history of why the Sterling zone effectively ended in 1972.BaseTurnComplete 10:17, 24 April 2006 (UTC)
Another British Empire trasher-"Britains decline as a world power-"well ,into third place actually- not bad for fifty millions out of five billion-and only after 450 years at the top!!! However it might interest somepeople that sterling was-right up to 1970 or so -the main trading currency of the world-out side America... As it is the fourth most important currency still -in 2006 thats not bad......In relative terms the British are still at the top ,currency wise as in everything else!!!
I think I will have to put this into the main article sometime
- Empire trasher? In the twenty years or so after WWII Britain went from a superpower to a second-tier power, militarily and strategically. That's a fact and is a clear decline in my book, albeit a decline from the top. By the way, I'm a Brit and view our imperial history in a very positive light. But being a Yorkshireman, I call a spade a spade. Just in case there are many more sensitive souls like you I've inserted the word "relative". Please sign your comments in talk! BaseTurnComplete 13:41, 16 July 2006 (UTC)
[edit] Query
What happened on that day in 1972? A devaluation on the part of British pound sterling? Should the Irish Pound be in this list? Morwen - Talk 18:18, 15 March 2006 (UTC)
- Apparently, the pound was floated. Warofdreams talk 02:08, 17 March 2006 (UTC)
- Well, the pound was effectively floated in 1971 with end of the Bretton Woods system. However Britain didn't move too quickly to float its currency away from the dollar due to the major negotiations about EEC membership that were ongoing. In fact the reason why Sterling floated from the dollar on June 23 1972, and why so many other Sterling area currencies floated from Sterling, was that the effective ending of the Sterling area (with the exception of a few dependencies like Gibraltar and Jersey) was a requirement of Britain's entry into the EEC on 1st January 1973. The Irish Pound should be on this list, as it was pegged to sterling until the early 1990s.BaseTurnComplete 20:47, 22 April 2006 (UTC)
[edit] Malta
The Maltese pound/Maltese lira should be included here. --Rumping 11:25, 19 October 2007 (UTC)
[edit] Iceland
Some of the links from [1] such as [2] suggest that Icelandic króna should be included. --Rumping (talk) 08:52, 19 November 2007 (UTC)
Yes. Iceland was a memember. George Smyth XI (talk) 06:21, 29 March 2008 (UTC)
Rumping, Iceland was a member from the outset in 1939. It was still a member in 1972. I don't know what they did after 1972. As to what value they pegged their Krone to the Pound Sterling in 1939, I don't know.
You must remember that the 'sterling' area was a very informal grouping with no formal rules. It's purpose disintegrated once the individual members realized that now that the gold standard has gone, they can experiment with their own monetary policies.George Smyth XI (talk) 07:08, 9 April 2008 (UTC)
- Looking at [3], it says "Prior to independence in 1918, Danish currency was used in Iceland. The Icelandic Krona was introduced on December 1, 1918 at par with the Danish Krone and became part of the Sterling area with 1 Pound Sterling = 18.1595 Kronur, falling to 22.15 Kronur in October 1925, and 27 Kronur on April 15, 1939. The exchange rate was set at 1 U.S. Dollar = 6.49 Kronur on September 20, 1939, falling to 9.34 Kronur on December 20, 1949, 16.29 Kronur on March 20, 1950. The dollar exchange rate has been calculated by using the pound to calculate the cross rate. From March 8, 1951 on, a multiple exchange rate structure was used until February 20, 1960 when the exchange rate was reestablished at 1 U.S. Dollar = 38 Kronur, falling to 43 Kronur on August 4, 1961, 57 Kronur on November 27, 1967 and 88 Kronur on November 12, 1968. A new Krona equal to 100 old Kronur was introduced in 1981." I have edited the article assuming you are right, taking 2.4*88 to be the rate in 1972. --Rumping (talk) 22:53, 9 April 2008 (UTC)
Rumping, I have looked at your source. The sterling area only came into existence at the outbreak of world war 2. So whoever said that Iceland joined the sterling area in 1925 was getting confused about the meaning of the term. In the early part of the 20th century, many countries pegged their currencies to sterling as it was the world's number one reserve currency but that didn't imply membership of the sterling area. The term 'sterling bloc' is perhaps the more accurate term for countries who pegged their currencies to sterling.
If the Iceland currency switched its peg to the dollar in 1939, this was only semantic since the dollar and the pound were pegged to each other at the time. Indeed your reference did state that the dollar/krone rate was worked out through the pound cross rate.
At any rate, one shouldn't lose track of the fact that the main feature of the sterling area was the fact that all the member countries operated mutual exchange control laws for the prevention of capital flights outside of the area. For this purpose, Iceland was unequivocally a member and Iceland can be seen listed on the exchange control legislation of all the member areas.
When the sterling area came about at the beginning of world war 2, many countries that pegged their currencies to sterling did not actually join the sterling area. Outside of the British Empire countries, I can only think of Iceland and Libya. George Smyth XI (talk) 04:19, 10 April 2008 (UTC)
On reflection, my guess is that Iceland pegged to sterling in 1925 when sterling returned to the gold standard. Many countries used to peg to sterling as a means of pegging to gold. It was known as the gold exchange standard.
However, when Britain finally abandoned gold in 1931 it left alot of confusion. It was uncharted territory. Nobody knew what money meant anymore. And so countries who had pegged to sterling were confused. In the end they just continued to peg to sterling until they had time to think the whole matter over.
It wasn't until the 1970's that countries increasingly began to experiment with their own monetary policies and float their currencies, or experiment by pegging with the US dollar instead. George Smyth XI (talk) 15:25, 10 April 2008 (UTC)
[edit] Map
the map is unclear, sow many reds sow simil, is not easy to see or read, i thinz red to blue, cross for pink and violet/purple, actual red-red deep-red too deep-purple is hard--201.255.30.43 (talk) 06:11, 1 February 2008 (UTC)
[edit] USSR
Perhaps something should be said about how the Soviet ruble was pegged to the pound from 1961 until the Union's collapse. 130.195.5.7 (talk) 00:06, 14 March 2008 (UTC)
[edit] The relevance of the EEC
Can we please see a citation which proves that the accession terms to the EEC made it that the UK had to abolish the sterling area. The newspapers of the time said that the decision to float the pound in June 1972 and to impose exchange controls on the overseas sterling area countries was due to large capital flights. George Smyth XI (talk) 06:41, 29 March 2008 (UTC)
[edit] Confusion between two topics
Whoever first wrote this article has got confused between two topics. These two topics are,
(i) The Sterling Area. (ii)The Rise and decline of Sterling as the world's leading reserve currency.
Although inter related, these are two different topics.
The Sterling area was a war time emergency measure. But the reason why such an area should have been deemed necessary does indeed relate to the role of sterling as a leading reserve currency.
However, the decline of the sterling area was mainly because the second world war was over and everybody was beginning to protect their own currencies. The collective desire to protect the external value of sterling during the war had lapsed.George Smyth XI (talk) 09:37, 29 March 2008 (UTC)
- It's true that in the 40 years of sterling area from 1939 to 1979, that sterling fell from being the world's leading reserve currency to being the world's number two reserve currency. But this really had no bearing on why these war time emergency measures fizzled out. George Smyth XI (talk) 15:29, 10 April 2008 (UTC)
[edit] Sterling Coins
The history of sterling itself goes back many hundreds of years before the spread of sterling coins to some parts of the British Empire. And the issue of regional versions of the sterling coinage only came at the tail end of the relatively short period of history in which sterling coins were used in the overseas empire.
Most of these overseas territories had already stopped using sterling coinage prior to decimilaisation in the UK in 1971, and some of these countries only began to issue their own versions of the sterling coinage because of a break in parity between the pound sterling and the local pound. The list of these countries includes Australia, New Zealand, Fiji, South Africa, Rhodesia, British West Africa, Nigeria, Gambia, Malawi, and the Republic of Ireland.
Since decimilisation, St. Helena, Gibraltar, and the Falkland Islands have been issuing sterling coinage of the decimal kind.
This topic should not however be confused with the sterling area topic. David Tombe (talk) 17:37, 14 April 2008 (UTC)
