Tears and Tantrums

Brexit

Honestly. What did we think would happen?

The United Kingdom is not terribly united today. A voting turnout of 72% has voted 52/48 in favour of leaving the European Union.

So, 48% of the voting public is feeling pretty miserable.

That’s the thing about a referendum. Unless there is a landslide, then a significant proportion of the electorate is going to be ticked off when the results are announced. Judging by my telephone and social media feeds this is what has occurred. Emotions are running high.

I have been open about my preference for ‘Leave’. I posted here.

Like everyone else, I know lots of people on both sides of the argument. Most are passionate about their views. Some, on the ‘Remain’ side, are now feeling very angry, upset and concerned. They see the vote as a catastrophic error. These are the people posting increasingly strident views on social media. It would be unreasonable to expect those friends ‘not bothered’ or those on the winning side to be furiously posting, I suppose.

The geography of the voting makes things even more vexing. In a nutshell, Scotland, Northern Ireland and London wanted to remain, and everyone else wanted to Leave. This has led to calls for another referendum on Scottish Independence and even on Northern Ireland uniting with the Republic of Ireland.

Oh dear. Lots of tears and tantrums.

Financial markets have reacted badly. I don’t want to belittle this – but the markets betted heavily on a remain vote. In fact the only exit polls were conducted by Hedge Funds. When the vote started going the other way – ‘panic’ ensued. Panic, in this case, means that traders holding positions that supposed a remain vote, unwound those positions to mitigate losses. Large UK companies have not suddenly become worthless.

What happens now? Put simply, nobody knows. They are working it out as I write, and probably still will be while you read.

I have been struck by the continued arrogance of the media, the pollsters and the politicians. A simple question was asked and a simple answer given. Yet, the talking heads are still explaining that people voted because they are racist, or because they are old, or because they don’t understand.

This combination of outraged friends and ‘establishment’ arrogance leaves me feeling the need to justify myself.

So, for the record.

I am not racist. I’m no teenager, but I’m not a pensioner either. I feel that I have a reasonable understanding of business, politics and logic. I am not a wide-eyed little Englander. I still voted leave.

I respect everyone’s right to a view. I admire the passion and commitment. I am refreshed that the continent is actively engaged in looking at how best to move forward.

Brexit – The end of days?

Bullingdon Club

I wrote a post about Brexit not long ago. You can read it here.

This blog is not really intended to be political, but sometimes I can’t resist.

The terribly dashing chaps highlighted in the photo are the poster boys of the Leave and Remain campaigns. Increasingly, both campaigns are spouting sensationalist rubbish.

They would have us believe that the day after the referendum, businesses will collapse, or instantly prosper. Our borders will become impenetrable, and fortress UK will sink like a stone, or soar like an eagle. Other European countries will heave a huge sigh of relief, either glad to see the back of us, or delighted that we have stayed in.

I hate to disappoint. Actually, absolutely nothing will happen. The vast majority of ordinary people in mainland Europe will barely register that we had a referendum, let alone know the result. Should we choose to exit, it will take at least two years to negotiate the terms.

Mr Cameron has hinted that Brexit will prompt war, pestilence and plague and Mr Johnson suggests that having defeated Napoleon and Hitler, mighty Britain will finally be subdued and made vassal by bureaucrats in grey suits.

If we are talking war – I would look a little further East to Mr Putin.

Should we stay or leave, business will get on with it. That’s what business does. The world will continue to turn.

In my never humble opinion, the EU is finished anyway. While our Eton boys biff away, the Italian banks are once again on the point of collapse and when they go down, they will take the state with it. The European Central Bank will come up with a plan, as it did for Cyprus, Greece and Ireland. Given that the Italian economy is an awful lot bigger, the plan will need to be an awful lot bigger too. Ferocious austerity will be imposed on Italy. (Good luck with that.) There will need to be gargantuan write-offs of debt, and German citizens will need to accept another kick in the living standards to keep Italy afloat: At least until Spain collapses anyway.

In the past, countries could use interest rates and quantitive easing (printing money) to influence their economies. That option is no longer there, meaning that countries in real trouble are saddled with the exact opposite monetary policy that they need.

Let me add a disclaimer here. This is just my opinion. I do not work for the IMF, ECB, BOE or even The Economist. But I’m right.

Grexit, Brexit, Anyexit. None of these will fatally the EU. The EU was fatally wounded in 1999 when the Euro was introduced. It’s just taking a bloody long time to die.

WAKE UP! Appeasement doesn’t work.

Chamberlain-Peace-in-our-Time-1938

The picture above is of Neville Chamberlain, a very nice chap, who is perhaps unfairly remembered almost entirely for his utterance “Peace in our time”.

He had met up with a little chap called Hitler and they had agreed that young Adolf was not going to do anything that might upset the United Kingdom of Great Britain and Northern Ireland.

So that’s all right then.

Chamberlain was far from alone in recommending that we avoid war at all costs. The vast majority of the USA was of the same mind, for example. Frankly, the young Nazi chap was clearing Europe up a bit. A little close to the line perhaps, particularly if you were Czech for example – but ultimately, better to let him get on with it, than risk war.

Appeasement they called it.

As a policy, it didn’t go terribly well.

Recently, a key issue in the parliamentary election in the UK has been Immigration.

Even more recently, we have been gripped in the new soap opera called ‘Grexit’.

There has been an enormous amount of focus on the harrowing and difficult conflict in Iraq and Syria.

Meanwhile, there have been some other bits and pieces of news. It is these bits and pieces that I wish to bring to your attention.

The UK military has been known to refer to the island of Cyprus as ‘our permanent aircraft carrier in the Eastern Mediterranean’.

More recently, the European Union made an example of Cyprus – forcing it to impose a levy on all bank accounts or drop out of the euro. In plain talk, savers in some Cyprus banks made an involuntary donation to the public purse. That showed them.

Completely coincidentally, Russian investment in Cyprus increased. While the rest of the world was running for cover, Russia was investing in Cyprus. In March of 2014, they even sent an aircraft carrier to pop in.

The Cypriot government has granted Russia access to a deepwater port and airfield you see. How very neighbourly.

Then there was a little fracas in the Crimea. All a bit difficult to follow for us Western folk – but it’s okay, that nice chap in Moscow sorted it out.

Something about a deep water port down there too. Still you have to admire the consistency.

I know that it is difficult to believe, but this Vladimir chap has also found the time to help out in Ukraine. Apparently there are a whole load of people in the Ukraine who really want to be best friends with Russia.

In fact, rather than move to Russia, these people have decided that they must take up arms to defend themselves from their own government. Thankfully Vlad has it all under control.

Meanwhile – The European Union is taking no prisoners in Greece. Time to make an example of them. Quietly, Vlad has offered to help out his comrades in Athens if they can’t make up with their European buddies. How nice of him.

What is amazing, is that this caring, community chap used to be a cold war warrior. He spent his life in learning subversion techniques – Hearts and Minds, I think that we call it.

After Mr Chamberlain waved his bit of paper and declared “Peace in Our Time”, well..

There wasn’t.