London: Billions of pounds were wiped off the value of companies with Scottish links and the pound was pummelled as markets took fright at the increasing prospect of Scotland voting next week to break away from the United Kingdom.
Investors yesterday dumped companies with exposure to Scotland, including the Royal Bank of Scotland and Lloyds Banking Group, which owns Bank of Scotland. They also ditched sterling, which at one point fell to its lowest level against the dollar for 10 months.
“Be afraid, be very afraid,” Deutsche Bank analysts warned its clients after the Sunday Times YouGov poll had showed a small lead for the yes campaign.
American Nobel prize-winning economist Paul Krugman echoed the analysts’ view, warning Scotland it was unsafe to vote yes while uncertainty about the country’s currency remained. “If Scottish voters really believe that it’s safe to become a country without a currency, they have been badly misled,” Krugman wrote in the New York Times. “The risks of going it alone are huge. You may think that Scotland can become another Canada, but it’s all too likely that it would end up becoming Spain without the sunshine.”
The Guardian
