Brexit

[Jeremy Roussak]

I admire your ability to ignore reality...

What reality do you contend I'm ignoring?

The FTSE-100 closed on Friday 17th at 6,021; yesterday it closed at 6,140. I don't think that's a fall.

The pound traded on Friday 17th at around $1.42. It rose in the few days leading up to the referendum, to touch $1.50 after the polls had closed and before the result was known. Now it's $1.33 or so: down significantly, certainly, but not by the 17c the BBC has been trumpeting.

We'll survive.

Jeremy

[drmike]

I'm trying to understand how leaving the EU will hurt trade to the EU for the British.  Will there be additional import duties for British goods sold to EU countries?  What happens to EU goods sold to Britain?  Would Britain insist on a quid pro quo for their goods for EU goods sold to them?  What will EU companies who now sell to Britain insist upon from the EU so they can continue to sell to Britain? 

What happens similarly with goods traded with non-EU countries before and after leaving the EU?

You have put your finger on one of the more pressing problems for both the EU and the UK.

Additionally, goods tended to be EU certified so that if it is deemed OK to sell in Germany then it's OK throughout the EU. That probably won't be the case after leaving.

I'm not sure but I think there are various additional taxes for non EU imports. Chinese steel springs to mind.

Mike

[Alan Klein]

It's why I raised the question.  I'd be worried if I owned a French winery or a German Mercedes Benz plant.   I wouldn't want the British in retaliation to slap an extra import duty so less Brits would buy my product.  GB would insist their products not be slapped with duties sold to the EU.  So the EU must be worrying a lot too; Brexit is not just a problem for GB.  There's going to be a lot of pressure from EU companies who like Sterlings to not punish the Brits.  Of course, this all would raise the argument that the EU might not be necessary.  This is going to be very interesting as the EU  unravels.

[drmike]

I think interesting might be an understatement

[hjulenissen]

It's why I raised the question.  I'd be worried if I owned a French winery or a German Mercedes Benz plant.   I wouldn't want the British in retaliation to slap an extra import duty so less Brits would buy my product.  GB would insist their products not be slapped with duties sold to the EU.  So the EU must be worrying a lot too; Brexit is not just a problem for GB.  There's going to be a lot of pressure from EU companies who like Sterlings to not punish the Brits.  Of course, this all would raise the argument that the EU might not be necessary.  This is going to be very interesting as the EU  unravels.

This is an interesting topic.

As a small country (Norway), we have an asymmetric relationship to the EU (or the US or Russia). If they choose to hit our Fish with import taxes, that will hurt. If we choose to stop purchasing French Wine, that will barely make a dent in the French Wine exports.

However, the relationship between UK and the EU is more symmetric. Say on the order of 10:1. So mutually locking each other trade would probably hurt EU as well. Perhaps sufficient to make companies and voters inside the EU unhappy. So should they be strict against the UK to warn future defectors, or should they be pragmatic to avoid hurting their economy?

I tend to see the EU as a possible counterweight/alternative/stabilizer to China (economically), Russia (military) and the US (both). Even though membership (especially for small countries) means loss of national power, belonging to the right club can come in handy when the big bullies wants more than their fair/legal share of the cake. There is also the question that while the EEA (https://en.wikipedia.org/wiki/European_Economic_Area) may consist of individually small countries (Norway, Iceland and Lichtenstein, Switzerland*)), the collective power would be greater if the UK was also in that club of non-clubbers. This group of countries would represent a larger domestic market, within Europe that would be hard to ignore for the EU looking to improve economy. Perhaps they would be pragmatic about enhancing free trade without expecting to have full political control.

-h

[Rob C]

Seems the Scots Nats have had the first slap in the face because the EU is reluctant to engage in talks regarding Scot Nat objectives, saying it's an internal matter for the UK.

http://www.heraldscotland.com/news/14585378.Nicola_Sturgeon_presses_on_despite_being_snubbed_by_Brussels_leadership/?ref=ebln

But, in the end, it's history: Hadrian built a wall to keep out Rangers and Celtic and now, a couple of thousand years later, the same teams are trying to lock themselves back in, in order to break out, in order to stay locked in somewhere else.

It would be difficut to write that as an acceptable screenplay.

Rob

[Rob C]

This is an interesting topic.

As a small country (Norway), we have an asymmetric relationship to the EU (or the US or Russia). If they choose to hit our Fish with import taxes, that will hurt. If we choose to stop purchasing French Wine, that will barely make a dent in the French Wine exports.

However, the relationship between UK and the EU is more symmetric. Say on the order of 10:1. So mutually locking each other trade would probably hurt EU as well. Perhaps sufficient to make companies and voters inside the EU unhappy. So should they be strict against the UK to warn future defectors, or should they be pragmatic to avoid hurting their economy?

I tend to see the EU as a possible counterweight/alternative/stabilizer to China (economically), Russia (military) and the US (both). Even though membership (especially for small countries) means loss of national power, belonging to the right club can come in handy when the big bullies wants more than their fair/legal share of the cake. There is also the question that while the EEA (https://en.wikipedia.org/wiki/European_Economic_Area) may consist of individually small countries (Norway, Iceland and Lichtenstein, Switzerland*)), the collective power would be greater if the UK was also in that club of non-clubbers. This group of countries would represent a larger domestic market, within Europe that would be hard to ignore for the EU looking to improve economy. Perhaps they would be pragmatic about enhancing free trade without expecting to have full political control.

-h

Yes, but at the worst, you could always go on a strict fish diet and get plenty of the right oils, and survive very well.

As we are in imminent danger of losing our main muscle, the City and the Money Business, to Paris and/or Frankfurt we would have not a lot left to survive upon. We are a 'service supplier' land, and services can be had ten a penny. The currency 'passport', apparently, allowed us to function as a clearing house for all Euro-based business, but that freedom of capital movement depended entirely upon membership of the club. Let's face it: if that function as clearing house were possible outwith the EU, Switzerland would alread have been doing it decades ago. It's the natural home of banking business. (And very expensive watch repair services, which for me, have just got a damned sight more expensive than I'd wagered when I opted to get mine fixed! No, please, no sympathy: it would bring tears to my wicked, capitalist eyes!)

I think the disgraceful, and hugely counterproductive crowing of Farage (just like Peter Pan!) yesterday in the face of the rest of the Europeans, about getting the UK out, might have had one saving grace: he suggested, no, stated, that the Euro would fail. He may be right. Having my coffee yesterday, the local rag on the table before me, brimming over with angst about their again, inconclusive elections, I mentioned my regrets to the waiter about the Brexit thing; he replied, saying: we are all looking under the bed for our unconverted pesetas! All in all, a wonderful time for trying to sell an apartment.

Hubris. And we shall all pay the penalties, wherever we live.

[muntanela]

Seems the Scots Nats have had the first slap in the face because the EU is reluctant to engage in talks regarding Scot Nat objectives, saying it's an internal matter for the UK.

http://www.heraldscotland.com/news/14585378.Nicola_Sturgeon_presses_on_despite_being_snubbed_by_Brussels_leadership/?ref=ebln

But, in the end, it's history: Hadrian built a wall to keep out Rangers and Celtic and now, a couple of thousand years later, the same teams are trying to lock themselves back in, in order to break out, in order to stay locked in somewhere else.

It would be difficut to write that as an acceptable screenplay.

Rob

Juncker will meet her (BBC).

[Justinr]

It's why I raised the question.  I'd be worried if I owned a French winery or a German Mercedes Benz plant.   I wouldn't want the British in retaliation to slap an extra import duty so less Brits would buy my product.  GB would insist their products not be slapped with duties sold to the EU.  So the EU must be worrying a lot too; Brexit is not just a problem for GB.  There's going to be a lot of pressure from EU companies who like Sterlings to not punish the Brits.  Of course, this all would raise the argument that the EU might not be necessary.  This is going to be very interesting as the EU  unravels.

Quite so, and it has been mentioned on here before that whatever the agenda of the politicians it is the commercial interests that will prevail. I believe 14% of the German workforce is involved in the car industry, Germany is not going to kiss goodbye to a market as important as the UK. In fact there are cynics who would suggest that the whole EU is shaped around providing a market for German made goods.

[Justinr]

This is an interesting topic.

As a small country (Norway), we have an asymmetric relationship to the EU (or the US or Russia). If they choose to hit our Fish with import taxes, that will hurt. If we choose to stop purchasing French Wine, that will barely make a dent in the French Wine exports.

However, the relationship between UK and the EU is more symmetric. Say on the order of 10:1. So mutually locking each other trade would probably hurt EU as well. Perhaps sufficient to make companies and voters inside the EU unhappy. So should they be strict against the UK to warn future defectors, or should they be pragmatic to avoid hurting their economy?

I tend to see the EU as a possible counterweight/alternative/stabilizer to China (economically), Russia (military) and the US (both). Even though membership (especially for small countries) means loss of national power, belonging to the right club can come in handy when the big bullies wants more than their fair/legal share of the cake. There is also the question that while the EEA (https://en.wikipedia.org/wiki/European_Economic_Area) may consist of individually small countries (Norway, Iceland and Lichtenstein, Switzerland*)), the collective power would be greater if the UK was also in that club of non-clubbers. This group of countries would represent a larger domestic market, within Europe that would be hard to ignore for the EU looking to improve economy. Perhaps they would be pragmatic about enhancing free trade without expecting to have full political control.

-h

Isn't the EU being just such a bully itself?

[stamper]

Information for the outsiders who have problems understanding racism in the context of Brexit. Some are conflating it with right and left in politics.

http://www.theguardian.com/politics/2016/jun/16/nigel-farage-defends-ukip-breaking-point-poster-queue-of-migrants

This is the racism that was presented to the public. Rather ironic is the fact that a Scottish photographer sold the image to Getty who sold it to Farage's Ukip gang. I have met the photographer and I know his father who is a professional photographer. I don't think either will be happy but one was paid for it. The underling racism will be hard for a outsider to fathom because they don't live in the UK and blaming both left and right is misleading. This is the problem when somebody who lives elsewhere - especially economic migrants - and doesn't live in a country relies on press from the country they now live in. It doesn't help if they have in built prejudices.

[Rob C]

I'm not sure what stamper is asserting, above, but one thing is for sure; Getty doesn't miss a chance to market:

 “It is always uncomfortable when an objective news photograph is used to deliver any political message or subjective agenda. However, the image in question has been licensed legitimately,” they said.

“Editorial integrity is of the utmost importance to Getty Images, and our photographers are passionate about documenting the global news agenda and covering issues from an objective and impartial standpoint. Our images are syndicated to almost 1 million customers around the world – whether that be to media, business and brands, or in this case, political parties.”

Global love. If only Tony Stone hadn't sold out...

;-)

Rob

[Rob C]

http://www.france24.com/en/livefeed


Interesting alternative points of view from the European mindset, with good debates each working day at around 6.15 (UK time) in the evening, working days. In English.

Rob

[Alan Klein]

Quite so, and it has been mentioned on here before that whatever the agenda of the politicians it is the commercial interests that will prevail. I believe 14% of the German workforce is involved in the car industry, Germany is not going to kiss goodbye to a market as important as the UK. In fact there are cynics who would suggest that the whole EU is shaped around providing a market for German made goods.

The final nail in the coffin of the EU will happen during the next recession when each country will try to protect what's left of their economy.  The uproar heard during the Greece crisis was child's play.  Nationalism from all quarters will be heard and the British with their compatriots the Scots and Irish will be glad they got out first.

[stamper]

The final nail in the coffin of the EU will happen during the next recession when each country will try to protect what's left of their economy.  The uproar heard during the Greece crisis was child's play.  Nationalism from all quarters will be heard and the British with their compatriots the Scots and Irish will be glad they got out first.

Obviously you aren't well read on the subject. Us sources not up to the job? The Irish and the Scots are overwhelmingly in favour of staying in. Does your crystal ball not tell you the split hasn't happened yet and it possibly won't happen? 

[Rob C]

Song for Boris et al.

https://www.youtube.com/watch?v=ynEwQV7I8lY

Rob

[Rob C]

The final nail in the coffin of the EU will happen during the next recession when each country will try to protect what's left of their economy.  The uproar heard during the Greece crisis was child's play.  Nationalism from all quarters will be heard and the British with their compatriots the Scots and Irish will be glad they got out first.

Personally, I don't quite see that.

What I imagine may happen is that business continues pretty much as normal, but with a set of different, mutually pleasing compromises, amongst the stronger countries. However, that will be a bit tricky for London and the question of being a Euro financial clearing house if the 'passport' isn't included in whatever deal is struck. That's a biggie, ignored (even hated) by the crazy ultra-left and their Pyrrhic attitude to life and its realities. The difference with the crazy ultra-right is that the latter thought it couldn't happen. Like they say, be careful for what you wish...

Rob

[Alan Klein]

My point Rob was that where is all the money going to come from to bail countries out?  Germans and other citizens won't put up with it.  Nationalism will kick in if just for economic reasons.

[Zorki5]

The underling racism will be hard for a outsider to fathom because they don't live in the UK and blaming both left and right is misleading. This is the problem when somebody who lives elsewhere - especially economic migrants - and doesn't live in a country relies on press from the country they now live in.

Why on Earth do you think people "rely on press from the country they now live in"? Why do you think I do not read The Guardian, for instance?

It's 21th century, stamper; time to adjust some assumptions.

[Manoli]

Jeremy,

You are factually incorrect. The petition wasn't started by the Remain campaign, but rather by a supporter of the Leave side, well before the Referendum. It's significance isn't as part of the current political process, but more an indicator of an ever rising groundswell of dissent - and something Parliament is taking note of.

But I do agree with you there will be no second referendum - yet, and events may soon prove it to be an irrelevance anyway.

Nevertheless, the idea that Parliament would ignore the result of the referendum it called, while certainly possible, strikes me as utterly absurd.

No-one suggested that Parliament 'ignore' the nation's wishes.

The referendum was purely advisory - it has no legal status. Consequently, Parliament should and will review the result of the referendum in the context of the nation's wider interests - at the appropriate time. And that is what Cameron, I believe, is doing.

Voting Leave in an advisory referendum because one wishes our Parliament to be Sovereign yet protesting when only Parliament can “decide” to leave the EU strikes me, to phrase it diplomatically, as being somewhat contradictory.

Doubtless this Parliament will take heed of the views of the people as it makes its decision and members will suffer or enjoy the consequences at the next election. That’s Parliamentary Sovereignty in action.

<<
The extent to which the referendum result has LEGAL force is only the extent to which the Sovereign Parliament has devolved or vested that power to the referendum outcome. It seems clear that this referendum did not have such devolved authority and so, unless the PM can rely upon prerogative powers to invoke Article 50 and can also claim that a “decision” to leave has been made in accordance with the UKs constitution (it hasn’t, legally speaking, if the referendum alone does not have legal force), then we are not discussing whether we think Parliament should or should not discuss this on pragmatic merit. We are pointing out, as a matter of constitutional law, it may have to.
>>

... the mechanism by which notice to leave under Article 50 of the Lisbon Treaty is triggered. There's a very good argument that such notice impliedly repeals earlier legislation, including the 1972 Act ...

I have read differing opinions on this. There is little, if anything, that can be 'implied'.

Manoli