That’s why we think the recent vote by the UK to leave the European Union is not the problem some analysts and investors think. The British people found themselves increasingly enmeshed in rules and regulations not of their own making, and lacking the representation of democratically elected leaders.
For example, in the topsy-turvy world of bureaucratic double-speak, EU rules required the British government to treat immigrants seeking welfare similarly to British citizens seeking welfare, because to treat them differently was supposedly an infringement on the right of people to travel in the EU.
Yes, the coming weeks will bring angst over what the future holds. But, ultimately, a freer and more independent Britain, one that has control over its own political destiny, is likely to be a more responsible and prosperous one as well.
The EU, which runs a large trade surplus with the UK, has every incentive to negotiate a free trade deal. Meanwhile, the UK has an opening to expand free trade with the US and Canada, which the EU was making more difficult.
The recent sell-off in equities based on Brexit is a buying opportunity. Look for the UK’s position relative to
the EU to evolve toward that of Norway or Switzerland, which have voted to not be members of the EU. So, the EU created a “social” membership in the European Economic Area, with free trade and easier border crossings, but a buffer from the political whims of Brussels. The UK is bigger than Norway or Switzerland, which gives it more leverage. The EU has created a bureaucracy which makes the costs of being a member greater than the benefits for the average citizen. Politicians, on the other hand, love big
bureaucracies. This time the people spoke. And, that’s why Brexis is good.
Brexit is good.