The Day of Jostles
Theresa May held an emergency cabinet meeting at Number 10 before heading to Parliament on Monday.
At the time of writing, Number 10 has refused to confirm nor deny whether a meaningful vote will take place. Deal or no deal. 2nd Referendum or leave without a deal.
Resignation or weather the storm?
At the time of writing, Cable was up 0.1% to $1.32173. After what’s been a choppy 52-weeks, the day has not been without its pitfalls.
The Pound hit a low $1.316 before bouncing back to $1.32 levels.
News hit the wires of the EU completing its no-deal plans for Britain departing the EU. The EU may be ready to deal with the concept, but economically it could be an altogether different story…
We’ve heard the travel plans, plans for students and the rest. Threats of banning travel were clear threats in the final months of negotiations.
The UK Government failed to fall for the bait of talk of shut down of the channel tunnel and for EU flights to be banned from entering the UK. Almost ludicrous to even consider such an eventuality. Perhaps the EU would like to build a wall…
The famous Brexit Petition that has been doing its rounds over the last week broke through the 5m barrier on Monday.
Why would the UK government listen to a minority protest over the British government’s desire to leave the EU at all costs?
More than 30m voted in the EU referendum back in 2016, making the voting turnout 72.2%.
According to figures released by UK parliament, the turnout for elections was traditionally high relative to other advanced economies.
The high turnouts ultimately dilute the effects of the current petition circulating. 5m votes against an in excess of 30m vote count just isn’t enough. More than 17.4m voted to leave the EU, with 16.14m voting to remain. 5m votes would certainly be enough if more than 3m had originally voted in favor of leaving.
There’s no way of knowing who are signing the petition and there’s no way of knowing whether any remainers would now opt to leave. The EU’s handling of the UK and even other EU member states could have riled voters enough to drive a greater wedge between those in favor of leaving and those looking to remain.
Those looking to remain within the EU will feel that democracy has failed to hear their voices. The only failing of democracy in the run-up to the EU Referendum was the political tug of war in Parliament. Scaremongering and more left voters bewildered on what a departure from the EU actually meant.
Even today the true ramifications are unknown. Once the dust settles, EU member states will likely expedite trade agreements with the UK. It would make perfect sense.
While we could explore the 28 member states and trade terms, looking at Germany is a reasonable one, particularly when considering the fact that the UK economy is the 2nd largest in the EU.
According to figures released by ONS.Gov.UK,
Total imports of goods from Germany stood at £67.985m in 2018. Exports to Germany amounted to £36.517m. It comes as no surprise that the largest imports of goods were cars, accounting for 13%. Road vehicles other than cars accounted for 35% of exports. That’s Germany’s bread and butter.
Theresa May could be on her way out, but the decision to be willing to go without a deal could be more of a calculated decision than a game of Russian roulette. If Germany makes the first move, more will undoubtedly follow, particularly continental Europe.
The Establishment may have the self-interest of preserving the EU but individual member states are required to preserve GDP per capita. Enough said…
What to look out for in the Day Ahead
Always expecting the worse prepares you from benefiting from the best of outcomes. For Britain and the EU, there’s no positive outcome.
UK politics has shown its Achilles Heel and the EU has just given anti-establishment voters another reason to go against the grain.
Spanish elections are first up. Will there be a shock?
Looking at the Pound against the Dollar over last 2-years, imagine a top 5 GDP following the UK out. Juncker certainly does not want the UK to prosper away from the EU… But it could…
This article was originally posted on FX Empire
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