The economic implications of Brexit

Rashmun wrote:can someone give their perspective on the economic implications of Brexit with respect to the british economy, the american economy, and the world economy? Thanks.

Kris wrote:

Rashmun wrote:can someone give their perspective on the economic implications of Brexit with respect to the british economy, the american economy, and the world economy? Thanks.

>>>Short term- will not be pretty. This has wide ranging implications..In the UK, the Cameron's gov't will likely not survive. For the community as a whole, many of the other member nations can take the Brits' cue and step up demands for more and more concessions. The currency markets will be impacted with the $ rising which will have a domino effect globally. As of now, hard to tell as to how this will all play out in the long run. The Brits have always been for their own currency and skeptical about a progressively closer European union. Culturally, the English channel is wider than the Atlantic as someone quipped while voicing opposition to the "chunnel" back in the day. With that kind of a mindset, it must be hard to buy into what they see as being lorded over by Brussels. There are other resentments pertaining to immigrants' rights, foreigners in Britain etc. 

Bremain will work out better in the short term but the resentment will continue among those who want to leave (close to half the population or more). They are not going to get any more concessions anyway. So, Bremain is also likely to be a stop-gap measure.  The following link does a good job of summarizing the implications. 

http://www.wsj.com/articles/effects-of-brexit-vote-to-span-markets-politics-1466630203

Rashmun wrote:Kris and others,

how does one explain this phenomenon:

For make no mistake, it is the old people who did this to us. I assume you have seen the voting breakdown by age? In the 18-24 group it was 64 per cent to Remain and 24 per cent to Leave. In the 25-49 age group it was 45 per cent to 39. Only in the 50-64 bracket does the balance shift, going over to 49 per cent for Leave, as against 35 for Remain. And then among the over-65s it was an astonishing 58 per cent for Leave, against 33 per cent for Remain.

The less time a person had left on earth to live and face up to their decision, in other words, the more likely they were to vote to leave the European Union.

The wrinkly bastards stitched us young ’uns up good and proper on Thursday. From their stair lifts and their Zimmer frames, their electric recliner beds and their walk-in baths, they reached out with their wizened old writing hands to make their wobbly crosses and screwed their children and their children’s children for a thousand generations.

http://www.theaustralian.com.au/news/world/the-times/brexit-the-wrinklies-have-well-and-truly-stitched-us-up/news-story/e5ce4775e7ce94a03727ea7e79a729e5

Kris wrote:

Rashmun wrote:Kris and others,

how does one explain this phenomenon:

For make no mistake, it is the old people who did this to us. I assume you have seen the voting breakdown by age? In the 18-24 group it was 64 per cent to Remain and 24 per cent to Leave. In the 25-49 age group it was 45 per cent to 39. Only in the 50-64 bracket does the balance shift, going over to 49 per cent for Leave, as against 35 for Remain. And then among the over-65s it was an astonishing 58 per cent for Leave, against 33 per cent for Remain.

The less time a person had left on earth to live and face up to their decision, in other words, the more likely they were to vote to leave the European Union.

The wrinkly bastards stitched us young ’uns up good and proper on Thursday. From their stair lifts and their Zimmer frames, their electric recliner beds and their walk-in baths, they reached out with their wizened old writing hands to make their wobbly crosses and screwed their children and their children’s children for a thousand generations.

http://www.theaustralian.com.au/news/world/the-times/brexit-the-wrinklies-have-well-and-truly-stitched-us-up/news-story/e5ce4775e7ce94a03727ea7e79a729e5

>>>  The younger crowd is more comfortable thinking of itself as European and with the idea of globalization. I don't know the demographic breakdown by age to see if this was a case of a lesser proportion of the youth set turning out to vote than in the older age segment or just that the population is top-heavy age-wise. The older segment is also more likely to have a memory of Britain as a major power, being within a generation of colonialism. The descent started in the 50s once the colony business started folding up. The part of being screwed for a thousand generations is hyperbole, considering the EU itself needs to get its act together. Brexit just fast tracked the problem. 

Britain has a few major problems on the horizon: the immediate financial implications, Scotland and Ireland. A lot is now going to depend on what kind of an arrangement it works out as part of the exit. If it is on favorable terms trade-wise with EU, it will take some of the sting out. It could also help in maintaining some of London's financial center clout. The one saving grace may be that its borrowings are in pounds, from what I have read. As to Scotland and Ireland, it is just a question of time. What is good for the goose is good for the gander. The other aspect to this is, other than the age factor, the support for Brexit seems to have from across the political spectrum. So there really can't be political finger pointing in terms of which side of the aisle to blame. From an outsider's perspective, Britain by itself has not been a player in a long time, EU or no EU. When the dust settles in a couple of years, this is going to end up being more of a local problem. The global economic climate will figure out the work-arounds once the shock subsides.

Kris wrote:

Rashmun wrote:Kris and others,

how does one explain this phenomenon:

For make no mistake, it is the old people who did this to us. I assume you have seen the voting breakdown by age? In the 18-24 group it was 64 per cent to Remain and 24 per cent to Leave. In the 25-49 age group it was 45 per cent to 39. Only in the 50-64 bracket does the balance shift, going over to 49 per cent for Leave, as against 35 for Remain. And then among the over-65s it was an astonishing 58 per cent for Leave, against 33 per cent for Remain.

The less time a person had left on earth to live and face up to their decision, in other words, the more likely they were to vote to leave the European Union.

The wrinkly bastards stitched us young ’uns up good and proper on Thursday. From their stair lifts and their Zimmer frames, their electric recliner beds and their walk-in baths, they reached out with their wizened old writing hands to make their wobbly crosses and screwed their children and their children’s children for a thousand generations.

http://www.theaustralian.com.au/news/world/the-times/brexit-the-wrinklies-have-well-and-truly-stitched-us-up/news-story/e5ce4775e7ce94a03727ea7e79a729e5

>>>  The younger crowd is more comfortable thinking of itself as European and with the idea of globalization. I don't know the demographic breakdown by age to see if this was a case of a lesser proportion of the youth set turning out to vote than in the older age segment or just that the population is top-heavy age-wise. The older segment is also more likely to have a memory of Britain as a major power, being within a generation of colonialism. The descent started in the 50s once the colony business started folding up. The part of being screwed for a thousand generations is hyperbole, considering the EU itself needs to get its act together. Brexit just fast tracked the problem. 

Britain has a few major problems on the horizon: the immediate financial implications, Scotland and Ireland. A lot is now going to depend on what kind of an arrangement it works out as part of the exit. If it is on favorable terms trade-wise with EU, it will take some of the sting out. It could also help in maintaining some of London's financial center clout. The one saving grace may be that its borrowings are in pounds, from what I have read. As to Scotland and Ireland, it is just a question of time. What is good for the goose is good for the gander. The other aspect to this is, other than the age factor, the support for Brexit seems to have from across the political spectrum. So there really can't be political finger pointing in terms of which side of the aisle to blame. From an outsider's perspective, Britain by itself has not been a player in a long time, EU or no EU. When the dust settles in a couple of years, this is going to end up being more of a local problem. The global economic climate will figure out the work-arounds once the shock subsides.

goodcitizn wrote:

Kris wrote:

Rashmun wrote:Kris and others,

how does one explain this phenomenon:

For make no mistake, it is the old people who did this to us. I assume you have seen the voting breakdown by age? In the 18-24 group it was 64 per cent to Remain and 24 per cent to Leave. In the 25-49 age group it was 45 per cent to 39. Only in the 50-64 bracket does the balance shift, going over to 49 per cent for Leave, as against 35 for Remain. And then among the over-65s it was an astonishing 58 per cent for Leave, against 33 per cent for Remain.

The less time a person had left on earth to live and face up to their decision, in other words, the more likely they were to vote to leave the European Union.

The wrinkly bastards stitched us young ’uns up good and proper on Thursday. From their stair lifts and their Zimmer frames, their electric recliner beds and their walk-in baths, they reached out with their wizened old writing hands to make their wobbly crosses and screwed their children and their children’s children for a thousand generations.

http://www.theaustralian.com.au/news/world/the-times/brexit-the-wrinklies-have-well-and-truly-stitched-us-up/news-story/e5ce4775e7ce94a03727ea7e79a729e5

>>>  The younger crowd is more comfortable thinking of itself as European and with the idea of globalization. I don't know the demographic breakdown by age to see if this was a case of a lesser proportion of the youth set turning out to vote than in the older age segment or just that the population is top-heavy age-wise. The older segment is also more likely to have a memory of Britain as a major power, being within a generation of colonialism. The descent started in the 50s once the colony business started folding up. The part of being screwed for a thousand generations is hyperbole, considering the EU itself needs to get its act together. Brexit just fast tracked the problem. 

Britain has a few major problems on the horizon: the immediate financial implications, Scotland and Ireland. A lot is now going to depend on what kind of an arrangement it works out as part of the exit. If it is on favorable terms trade-wise with EU, it will take some of the sting out. It could also help in maintaining some of London's financial center clout. The one saving grace may be that its borrowings are in pounds, from what I have read. As to Scotland and Ireland, it is just a question of time. What is good for the goose is good for the gander. The other aspect to this is, other than the age factor, the support for Brexit seems to have from across the political spectrum. So there really can't be political finger pointing in terms of which side of the aisle to blame. From an outsider's perspective, Britain by itself has not been a player in a long time, EU or no EU. When the dust settles in a couple of years, this is going to end up being more of a local problem. The global economic climate will figure out the work-arounds once the shock subsides.

Being in the banking industry for years, you probably foresee the difficulty Britain will have with the pound getting pounded. However, with this simultaneously having a negative impact on the Euro, what are your thoughts in the global banking scenario?

Kris wrote:

goodcitizn wrote:

Kris wrote:

Rashmun wrote:Kris and others,

how does one explain this phenomenon:

For make no mistake, it is the old people who did this to us. I assume you have seen the voting breakdown by age? In the 18-24 group it was 64 per cent to Remain and 24 per cent to Leave. In the 25-49 age group it was 45 per cent to 39. Only in the 50-64 bracket does the balance shift, going over to 49 per cent for Leave, as against 35 for Remain. And then among the over-65s it was an astonishing 58 per cent for Leave, against 33 per cent for Remain.

The less time a person had left on earth to live and face up to their decision, in other words, the more likely they were to vote to leave the European Union.

The wrinkly bastards stitched us young ’uns up good and proper on Thursday. From their stair lifts and their Zimmer frames, their electric recliner beds and their walk-in baths, they reached out with their wizened old writing hands to make their wobbly crosses and screwed their children and their children’s children for a thousand generations.

http://www.theaustralian.com.au/news/world/the-times/brexit-the-wrinklies-have-well-and-truly-stitched-us-up/news-story/e5ce4775e7ce94a03727ea7e79a729e5

>>>  The younger crowd is more comfortable thinking of itself as European and with the idea of globalization. I don't know the demographic breakdown by age to see if this was a case of a lesser proportion of the youth set turning out to vote than in the older age segment or just that the population is top-heavy age-wise. The older segment is also more likely to have a memory of Britain as a major power, being within a generation of colonialism. The descent started in the 50s once the colony business started folding up. The part of being screwed for a thousand generations is hyperbole, considering the EU itself needs to get its act together. Brexit just fast tracked the problem. 

Britain has a few major problems on the horizon: the immediate financial implications, Scotland and Ireland. A lot is now going to depend on what kind of an arrangement it works out as part of the exit. If it is on favorable terms trade-wise with EU, it will take some of the sting out. It could also help in maintaining some of London's financial center clout. The one saving grace may be that its borrowings are in pounds, from what I have read. As to Scotland and Ireland, it is just a question of time. What is good for the goose is good for the gander. The other aspect to this is, other than the age factor, the support for Brexit seems to have from across the political spectrum. So there really can't be political finger pointing in terms of which side of the aisle to blame. From an outsider's perspective, Britain by itself has not been a player in a long time, EU or no EU. When the dust settles in a couple of years, this is going to end up being more of a local problem. The global economic climate will figure out the work-arounds once the shock subsides.

Being in the banking industry for years, you probably foresee the difficulty Britain will have with the pound getting pounded. However, with this simultaneously having a negative impact on the Euro, what are your thoughts in the global banking scenario?

>>>>>GC,

The question is way above my pay grade . I think a recession is inevitable in Britain and quite likely at least to some degree globally soon. Central Bankers need to be working fast and furious to address this. In the long run, a lot is going to depend on the arrangement worked out by the Brits as to the nature of the relationship with the EU. If it is like what the Swiss have now ( I think HA mentioned this in one of his posts), Britain can retain some financial and economic clout. If it is a complete divorce, that could be disastrous for Britain and will ripple out globally. I am betting that cooler heads will prevail and they will take the former route, even though that will not please the exiters who voted to leave because of the other Europeans in their midst. This whole crisis brings to the fore the cultural divide in the West between the higher income set which is the beneficiary of globalization and those left behind because of it.

Kris wrote:cession is inevitable in Britain and quite likely at least to some degree globally soon. Central Bankers need to be working fast and furious to address this. In the long run, a lot is going to depend on the arrangement worked out by the Brits as to the nature of the relationship with the EU. If it is like what the Swiss have now ( I think HA mentioned this in one of his posts), Britain can retain some financial and economic clout. If it is a complete divorce, that could be disastrous for Britain and will ripple out globally. I am betting that cooler heads will prevail and they will take the former route, even though that will not please the exiters who voted to leave because of the other Europeans in their midst. This whole crisis brings to the fore the cultural divide in the West between the higher income set which is the beneficiary of globalization and those left behind because of it.

Kris wrote:

Kris wrote:

goodcitizn wrote:

Kris wrote:

Rashmun wrote:Kris and others,

how does one explain this phenomenon:

For make no mistake, it is the old people who did this to us. I assume you have seen the voting breakdown by age? In the 18-24 group it was 64 per cent to Remain and 24 per cent to Leave. In the 25-49 age group it was 45 per cent to 39. Only in the 50-64 bracket does the balance shift, going over to 49 per cent for Leave, as against 35 for Remain. And then among the over-65s it was an astonishing 58 per cent for Leave, against 33 per cent for Remain.

The less time a person had left on earth to live and face up to their decision, in other words, the more likely they were to vote to leave the European Union.

The wrinkly bastards stitched us young ’uns up good and proper on Thursday. From their stair lifts and their Zimmer frames, their electric recliner beds and their walk-in baths, they reached out with their wizened old writing hands to make their wobbly crosses and screwed their children and their children’s children for a thousand generations.

http://www.theaustralian.com.au/news/world/the-times/brexit-the-wrinklies-have-well-and-truly-stitched-us-up/news-story/e5ce4775e7ce94a03727ea7e79a729e5

>>>  The younger crowd is more comfortable thinking of itself as European and with the idea of globalization. I don't know the demographic breakdown by age to see if this was a case of a lesser proportion of the youth set turning out to vote than in the older age segment or just that the population is top-heavy age-wise. The older segment is also more likely to have a memory of Britain as a major power, being within a generation of colonialism. The descent started in the 50s once the colony business started folding up. The part of being screwed for a thousand generations is hyperbole, considering the EU itself needs to get its act together. Brexit just fast tracked the problem. 

Britain has a few major problems on the horizon: the immediate financial implications, Scotland and Ireland. A lot is now going to depend on what kind of an arrangement it works out as part of the exit. If it is on favorable terms trade-wise with EU, it will take some of the sting out. It could also help in maintaining some of London's financial center clout. The one saving grace may be that its borrowings are in pounds, from what I have read. As to Scotland and Ireland, it is just a question of time. What is good for the goose is good for the gander. The other aspect to this is, other than the age factor, the support for Brexit seems to have from across the political spectrum. So there really can't be political finger pointing in terms of which side of the aisle to blame. From an outsider's perspective, Britain by itself has not been a player in a long time, EU or no EU. When the dust settles in a couple of years, this is going to end up being more of a local problem. The global economic climate will figure out the work-arounds once the shock subsides.

Being in the banking industry for years, you probably foresee the difficulty Britain will have with the pound getting pounded. However, with this simultaneously having a negative impact on the Euro, what are your thoughts in the global banking scenario?

>>>>>GC,

The question is way above my pay grade . I think a recession is inevitable in Britain and quite likely at least to some degree globally soon. Central Bankers need to be working fast and furious to address this. In the long run, a lot is going to depend on the arrangement worked out by the Brits as to the nature of the relationship with the EU. If it is like what the Swiss have now ( I think HA mentioned this in one of his posts), Britain can retain some financial and economic clout. If it is a complete divorce, that could be disastrous for Britain and will ripple out globally. I am betting that cooler heads will prevail and they will take the former route, even though that will not please the exiters who voted to leave because of the other Europeans in their midst. This whole crisis brings to the fore the cultural divide in the West between the higher income set which is the beneficiary of globalization and those left behind because of it.

>>>Just wanted to add  that if they do choose the 'Swiss' route, that would still not mean they are out of the woods. They will still have to deal with the Brexit aftermath in the short run, but it will be a localized problem. If they don't, the problem will affect everyone else as well. I am betting that decisions will be made with the long view and and the aim of controlling damage.

goodcitizn wrote:

Kris wrote:

Kris wrote:

goodcitizn wrote:

Kris wrote:
>>>  The younger crowd is more comfortable thinking of itself as European and with the idea of globalization. I don't know the demographic breakdown by age to see if this was a case of a lesser proportion of the youth set turning out to vote than in the older age segment or just that the population is top-heavy age-wise. The older segment is also more likely to have a memory of Britain as a major power, being within a generation of colonialism. The descent started in the 50s once the colony business started folding up. The part of being screwed for a thousand generations is hyperbole, considering the EU itself needs to get its act together. Brexit just fast tracked the problem. 

Britain has a few major problems on the horizon: the immediate financial implications, Scotland and Ireland. A lot is now going to depend on what kind of an arrangement it works out as part of the exit. If it is on favorable terms trade-wise with EU, it will take some of the sting out. It could also help in maintaining some of London's financial center clout. The one saving grace may be that its borrowings are in pounds, from what I have read. As to Scotland and Ireland, it is just a question of time. What is good for the goose is good for the gander. The other aspect to this is, other than the age factor, the support for Brexit seems to have from across the political spectrum. So there really can't be political finger pointing in terms of which side of the aisle to blame. From an outsider's perspective, Britain by itself has not been a player in a long time, EU or no EU. When the dust settles in a couple of years, this is going to end up being more of a local problem. The global economic climate will figure out the work-arounds once the shock subsides.

Being in the banking industry for years, you probably foresee the difficulty Britain will have with the pound getting pounded. However, with this simultaneously having a negative impact on the Euro, what are your thoughts in the global banking scenario?

>>>>>GC,

The question is way above my pay grade . I think a recession is inevitable in Britain and quite likely at least to some degree globally soon. Central Bankers need to be working fast and furious to address this. In the long run, a lot is going to depend on the arrangement worked out by the Brits as to the nature of the relationship with the EU. If it is like what the Swiss have now ( I think HA mentioned this in one of his posts), Britain can retain some financial and economic clout. If it is a complete divorce, that could be disastrous for Britain and will ripple out globally. I am betting that cooler heads will prevail and they will take the former route, even though that will not please the exiters who voted to leave because of the other Europeans in their midst. This whole crisis brings to the fore the cultural divide in the West between the higher income set which is the beneficiary of globalization and those left behind because of it.

>>>Just wanted to add  that if they do choose the 'Swiss' route, that would still not mean they are out of the woods. They will still have to deal with the Brexit aftermath in the short run, but it will be a localized problem. If they don't, the problem will affect everyone else as well. I am betting that decisions will be made with the long view and and the aim of controlling damage.

Many EU countries want the divorce to happen quickly although there are those like Angela Merkel who want cooler heads to prevail, not get nasty. I don't know much about Boris Johnson, if he will be the new PM. He'll have a tough job ahead both within and outside. And there will be an exodus of financial institutions. HSBC is already talking about moving over a thousand people from London to Paris. Meanwhile Scotland wants a referendum to become independent. Who knows what Northern Ireland is planning to do. The Londoners should be saying to David Cameron what Stan Laurel always says to Oliver Hardy, "Here's another nice mess you've gotten us into."

Kris wrote:

goodcitizn wrote:

Kris wrote:

Kris wrote:

goodcitizn wrote:
Being in the banking industry for years, you probably foresee the difficulty Britain will have with the pound getting pounded. However, with this simultaneously having a negative impact on the Euro, what are your thoughts in the global banking scenario?

>>>>>GC,

The question is way above my pay grade . I think a recession is inevitable in Britain and quite likely at least to some degree globally soon. Central Bankers need to be working fast and furious to address this. In the long run, a lot is going to depend on the arrangement worked out by the Brits as to the nature of the relationship with the EU. If it is like what the Swiss have now ( I think HA mentioned this in one of his posts), Britain can retain some financial and economic clout. If it is a complete divorce, that could be disastrous for Britain and will ripple out globally. I am betting that cooler heads will prevail and they will take the former route, even though that will not please the exiters who voted to leave because of the other Europeans in their midst. This whole crisis brings to the fore the cultural divide in the West between the higher income set which is the beneficiary of globalization and those left behind because of it.

>>>Just wanted to add  that if they do choose the 'Swiss' route, that would still not mean they are out of the woods. They will still have to deal with the Brexit aftermath in the short run, but it will be a localized problem. If they don't, the problem will affect everyone else as well. I am betting that decisions will be made with the long view and and the aim of controlling damage.

Many EU countries want the divorce to happen quickly although there are those like Angela Merkel who want cooler heads to prevail, not get nasty. I don't know much about Boris Johnson, if he will be the new PM. He'll have a tough job ahead both within and outside. And there will be an exodus of financial institutions. HSBC is already talking about moving over a thousand people from London to Paris. Meanwhile Scotland wants a referendum to become independent. Who knows what Northern Ireland is planning to do. The Londoners should be saying to David Cameron what Stan Laurel always says to Oliver Hardy, "Here's another nice mess you've gotten us into."

>>> It could very well be Boris. No matter who it is, if they want to come out of this half way decent, they should aim for a "special relationship" with the EU, considering the level of trade with it. Regaining ground on London's status as a financial center should go hand in hand with that.  This will be a tall order considering what the EU will want in exchange, which will not play well at home.