The Tories are getting desperate. As the Lib Dems surge in the polls and look like spoiling the Tory (premature) election celebration party, the knives are out for Nick Clegg. All the Tory press are in full assault mode today.
One of the most ridiculous attacks is to say that the financial markets and the value of the pound will collapse if the people of Britain dare to vote for anything other than a resounding Tory majority. Actually for a month we have been looking at a hung parliament as a likely outcome and the markets know it. Markets don’t wait to see what happens. They seek to predict what is going to happen. So they have done just that.
I don’t rule out some market volatility before and after election day BUT the current state of markets reflects what traders predict will happen and that is a hung parliament.
Surprise surprise – The result is not financial Armageddon.
A month ago the FTSE 100 share index of leading companies was valued at 5650 points. This morning as I write this it is on 5732 points.
A month ago the £ was worth $1.51. This morning it is worth $1.54. The increase in the value of the pound against the Euro is even greater.
So much for the nonsense of the Tory scare stories.