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Britain Votes To Leave EU

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They'll figure it out.

 

That's not in question but to what level of satisfaction?  Will they solve the sovereignty, immigration and finance problem?  Not if they want to be successful economically.  While not a member of the EU if they want to participate equally in trade they are going to have to relent on some of the very things they promised the people:  money into the NHS, closed borders. Neither of those things will happen.  

 

The leave party campaigned on having your cake and eating too.  We all know that doesn't happen in real life.  

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all of this is irrelevent. what they'll do is to take a lesson from the american playbook. they'll change the rules, and either re-vote(strangely this time it'll be a landslide in favor of remaining) or they'll just play a game similar to the delagate game, and find a way to say "oops.....that was a mistake, we're staying".

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I seriously doubt that 1LT

 

I think you're wrong.  I think there's a reasonable probability they'll stay.  Farrage and Johnson, the head leavers, have both resigned and the party is under fire.  

 

I'm not confident enough to handicap it but I think there's reasonable odds they're going nowhere.  Over 4 million people have signed a petition to have a second referendum.  

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Imagine if you voted for your state rep, in your district.  He goes to Trenton, votes for whatever is in the interest of his district and you.    You want to build a 10x12 shed.   Someone in Miami, lets call them the FUs, who you don't even know, didn't vote for and can't vote away decides you are no longer able to build a shed larger than 4' x 4' on your property.

 

You complain to your rep, he files a dispute with the FU.    A judiciary group in the FU, also who you don't know, can't vote for, nor can you remove, decides against your rep.

 

End of story, that's it, it is now law.  No shed for you.

 

Did you watch Brexit the movie?  You should.    The EU decided that British fishermen were not allowed to fish off of their own shores.  In fact, they gave those fishing grounds to others.   When the UK complained, they were denied.  In fact, of the 72 major complaints that the UK has had with the EU, 72 were decided against the UK.    

 

There are 5 presidents in the EU...they hold the job for a short period of time, go back into a different group and emerge again later.  It is literally re-arraigning the deck chairs to obfuscate who decides on what.   The EU elects its own presidents and leaders of the powerful committees.    No one gets to know how the election is held..that's all secret.

 

The EU was specifically designed to hide its workings so that not only does no one know how decisions are made or who made them but once decisions are made, they can't be changed.

 

It's insanity and it needs to die.  It's a works program by bureaucrats so that they can retire with lavish pensions and rule without accountability.

So just like NJ on a larger scale

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That's not entirely accurate--but I'm not going to get into a pissing match. They recieve an enormous amount of what they pay back in the form of farm subsidies and educational grants. The EU also paid to redevelop Wales when they built a large tech call center in a place where England never invested.

 

There are a lot of financial services firms and financial services utilities, e.g. EuroClear, which will have to leave London to be EU relevant and passported. Franfurt will most likely be the destination for these things because they have the infrastructure to support it. Jamie Dimon and Brian Moynihan have already said they have to move operations. Deutsche Bank employs more people in London currently than they do Germany. All that will change and financial services is the biggest sector in the British economy. Look at the UK based banks just in the news.

 

Lastly, you can just google this, the minister of Exchequer, British version of the treasury, has already said this will result in a need to raise taxes and reduce spending.

 

Most of what happens will depend on trade agreements and a lot of that will depend on how the EU behaves towards England. It could be a bit cool for a while but who knows. However, most of the things that the Brexit movement voted for will be won't happen if Brits still want to work in and retire in other countries. Think about every British citizen having to obtain a work visa in the countries they are working in outside of England? Most counties will only grant foreign work visas if the role can't be filled by someone who is an EU citizen.

 

However, if the Brits are happy then I'm happy for them but most of them have no idea what they're in for. The night after the polling closed the most searched terms in the UK were, "what is the EU?" and "what does it mean to leave the EU?"

 

 

Here, cut and paste this into google: "minister of exchequer taxes spending Brexit"

Not buying it. Our politicians say things, too. As well as manage to spread scary propaganda to support their causes. An effective 10% tax cut beats a financed campus.

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Not buying it. Our politicians say things, too. As well as manage to spread scary propaganda to support their causes. An effective 10% tax cut beats a financed campus.

 

 

There's no 10% tax cut, you manufactured that, so your premise is flawed and they will actually have to raise taxes--a quote from Exchequer.  The promise was to redirect EU payments to the NHS.  That's already been re-traded by the guys who made the promise.  So yes they are exactly like our politicians, they lied to get a vote they wanted.  In fact the two numb nuts that made all the promises have both resigned from their parties and parliament because of how badly they mislead the voters.  So the scary propaganda they bought was staying in the EU was bad.  

 

Don't forget the other big issue was immigration.  They want control of their borders which the eventually won't get if they want to be on equal footing from a trade and employment perspective.  There is a tremendous number of Brits working outside England that if the English should pay hardball will be forced to repatriate and apply for work visas--not likely.  England is going to have enough of an unemployment issue that they are going to want employed people in other countries to come home and further drain the public dole.   Of course that is two way and foreigners working in England will have to repatriate out as well.  However, there is a huge deficit that works against the Brits.  When all the high paying jobs at Deutsche Bank, JP Morgan, Merrill Lynch, Citi, RBS, UBS, Credit Suisse leave London and the foreign workers follow those jobs to wherever they end up--I predict Frankfurt--it will just further exacerbate the deficit and reduce tax collections (causing further negative consequences).  

 

There's already over 4 million signatures for a re-vote on the referendum.

 

I gave one example in the form of Welsh redevelopment of many on EU funding to the UK.  Most of England isn't like London, it's like the Medieval times with a mostly unsophisticated populous.  The example I would use for the EU is it's similar to a representative republic, which of course leads to debates over local (states) vs the republic (federal) reign.  

 

England also runs the largest, by a lot, account deficit for funding imports and that will come back and bite them in the ass at some point.   Right now with the uncertainty Gilts, English treasury bonds, are selling and yielding nothing, which is the only silver lining for as long as it lasts.  However, if the economy stumbles, and it will, they will have a very difficult time funding their account deficit.  Other countries like Venezuela have that issue and now when people take a shit they have to use their sleeve to wipe their asses.  I don't believe it will get that bad for England.  Venezuela's economy is shrinking by 10% most prediction for England are 3% if they do a good job cutting trade deals.  

 

England

http://www.tradingeconomics.com/united-kingdom/current-account

 

You can believe what you like, I said I wouldn't get into a pissing match, but this is what I do for a living,   

 

As I've said before I don't care if they stay or go but it was a great bit of bamboozling by two clowns that are now out of government.  BTW, the sterling is trading at 1.28 below a 30 year low.  Stay or go I don't care.but tax cut?  No way, tax increase and pretty big most likely.  Remember they have Obamacare on steroids, everyone gets it   Right now I'm focused on handicapping whether or not they'll actually go.  

 

One the most expensive real estate markets in the world London is already suffering:

http://www.wsj.com/articles/u-k-property-shares-drop-on-uncertainty-following-eu-referendum-vote-1467715870

 

 

One week sterling / usd chart:

http://www.xe.com/currencycharts/?from=GBP&to=USD&view=1W

 

Here's the 10 year, look at 08 when it was 2.05:

http://www.xe.com/currencycharts/?from=GBP&to=USD&view=10Y

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So just like NJ on a larger scale

Uhhh no guys, like the United States on a slightly smaller scale.  We are a representative republic and not a pure democracy, you know that right?  

 

Do you think Texas wants gay marriage?  Do you think Arizona wants men whipping out their wangs in the ladies room?  However, the federal representatives do and kind of trampled states right on the way, eh?

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We used to be a representative republic.

 

It's unclear what we are now.

 

I unfortunately have to agree with that now.  What we are is unclear but the direction we are headed is clearly bad. 

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I do a lot of work through British PR firms, mostly for arranging interviews with big European companies. Today a woman who is paid big bucks to answer editorial queries, and who took 8 days to respond to one from me, blamed it on Brexit, and the "upheaval" it caused.

 

The F-ing Europeans will use any excuse not to work. You can take Britain out of Europe, but you can't take European laziness and excuse-mongering out of the Brits.

 

P.S. The EU, our former Madame Secretary, the Lawn Jockey in Chief, and the Olympics can all drown in their own vomit AFAIC.

 

GO TRUMP!!

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If you're saving for the long term don't time markets. The Dow Jones Industrials have retuned 9% adjusted for corporate actions since inception. Sometimes it makes large moves up or down over a short observable period but it eventually mean reverts. Its been pretty steady as evidenced by the data.

Since inception. What about the last 20 yrs, from 1995-2015?

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Since inception. What about the last 20 yrs, from 1995-2015?

 

The Dow has returned 9.895 since 1-1-95 up to the close today.   I had a typo when I was using my iPad I meant to type 9.9% and don't know what happened. The official data is 9.902% since inception with corporate actions.  

 

So it's pretty spot on.  

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Actual return vs CAGR. I'm only quoting CAGR. I'm not sure what you're looking for.

 

Sorry dude forgot the word annually since inception. My bad thought it would be evident.

 

Sometimes I type too fast for my own good and don't proof read.

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Actual return vs CAGR. I'm only quoting CAGR. I'm not sure what you're looking for.

 

Sorry dude forgot the word annually since inception. My bad thought it would be evident.

 

Sometimes I type too fast for my own good and don't proof read.

 

 

I'm with you, just doing really quick back of envelope math to get to same #.  

345*.44=151.8 to adjust for inflation (source is http://www.bls.gov/data/inflation_calculator.htm

151.8/20 = 7.59   

 

I know that's not CAGR nor is it an annualized return.  Just some quick math to show that S&P did actually increase by 7.59% per year on average in real terms. 

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I'm with you, just doing really quick back of envelope math to get to same #.  

345*.44=151.8 to adjust for inflation (source is http://www.bls.gov/data/inflation_calculator.htm

151.8/20 = 7.59   

 

I know that's not CAGR nor is it an annualized return.  Just some quick math to show that S&P did actually increase by 7.59% per year on average in real terms. 

 

Yes that is pretty good back of the envelope work and probably represents a reasonable view on an inflation adjusted return.  All of which supports that people shouldn't pretend to be stock pickers and not try and time markets, but instead have a sound investment plan.   

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Since this is evolving over the next two years and has quieted a bit in the public eye I thought I'd point out that the sterling is at 1.27 this morning, which is the lowest in 31 years and not looking to rebound soon. 

 

The financial firms are especially in question as they use the EU passporting to conduct operations all over the region without setting up specific entities in each location in which they do business.  Euroclear is a utility that allows these firms to conduct trading and clearing anywhere as well.  Currently the financial services sector accounts for over 12% of the British economy.  It will be interesting to see where they move if England can't cut a deal to keep them.  Of course that would mean they've also given up on managing their borders.  

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