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    European Banks Fear Recession Over Scottish Independence

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    The major European banks Barclays, Deutsche Bank, Société Générale, JP Morgan, RBC Capital Markets and Credit Suisse have made pessimistic economic predictions regarding the consequences of Scotland's secession from the UK.

    MOSCOW, September 11 (RIA Novosti), Ekaterina Blinova - The major European banks Barclays, Deutsche Bank, Société Générale, JP Morgan, RBC Capital Markets and Credit Suisse have made pessimistic economic predictions regarding the consequences of Scotland's secession from the UK.

    "The decision by six global financial institutions to raise concerns over the impact of Scottish independence has stoked fears that a Yes vote could reverse the recovery. A senior Conservative MPs warned of ‘economic catastrophe’ across Britain within days of a vote for independence," the Telegraph reports.

    The Independent bemoans a "worsening exodus of global money from shares in British companies," referring to figures published by Société Générale . Meanwhile Nomura, Japan's biggest bank, has told its investors about the "cataclysmic" prospects of a possible 15 percent drop in sterling that could result from a Yes vote. It should be noted that sterling has fallen sharply since a YouGov poll revealed that the gap between the Yes and No votes had diminished.

    "Nomura’s advice to clients such as giant pension funds was not only to pull money out of British investments, but to take out bets against British Government bonds and UK banks’ share prices," the British media source stresses.

    "A Yes vote would create considerable economic and political uncertainties for the UK, which would not fade quickly," says Citi analyst Michael Saunders, as quoted by the Daily Mail.

    Economists emphasize that a Yes vote will hit the Scottish economy even harder than the British one.

    "I have a message for the Scots: Be afraid, be very afraid. 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," writes Paul Krugman, a professor of Economics and International Affairs at Princeton University, in his Op-Ed "Scots, What the Heck?" published in the New York Times.

    According to the major European banks, an independent Scotland will inevitably fall into recession, suffering from rising unemployment and wage cuts.

    "Scotland will be plunged into an economic crisis within days of a Yes vote. The big financial and other institutions are not going to stay in Scotland," said an unnamed Conservative MP as cited by the Telegraph.

    The Daily Mail notes that Scottish estate agents have already reported "a freeze in home sales." Buyers are waiting for the result of the referendum, expecting a "'flood' of homes to be sold," if Scots say yes to independence, the media source underscores.

    The views and opinions expressed in the article do not necessarily reflect those of Sputnik.

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    Scotland on the Eve of Independence Referendum (210)
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    independence referendum, independence, banks, Scotland
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