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UK & EU Economies post Brexit

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MIA asked for a link about the financial services sector concerns and passporting. Heres one I had bookmarked post Brexit.

City of London could be cut off from Europe, says ECB official

London-based institutions could be stripped of ‘passports’ that allow them to sell services to rest of EU, says François Villeroy de Galhau

http://www.theguardian.com/politics/2016/jun/25/city-of-london-could-be-cut-off-from-europe-says-ecb-official

Here's one from Deutsche Bank.

London is likely to lose its financial passport, and investment banks that shift operations abroad quickly will benefit from a "first-mover advantage," according to a confidential Deutsche Bank briefing seen by Business Insider

 

http://uk.businessinsider.com/confidential-deutsche-bank-briefing-where-banks-post-brexit-2016-7

Of course none of this is a done deal. My original post was that I see the doubts as a major economic concern given the UKs huge dependence on the financial sector for GDP jobs and taxes.

For balance, I also have a link from Boris saying that all of the above is ( swear filter for rollocks) scatter cushion but I can't be arsed to post it. Feel free to Google it. :hi:

Edited by kar999

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6 minutes ago, mike Meehan said:

I understand that Paul, though at this stage I prefer EU picture to Brexit picture - you may have gathered I have not got to the stage yet of giving up on this :D

 

Well I think I've found a solution to your problem Mike. Reverese your C/W ratio, or even improve in to 11 months C and 1 month W. Simples really:D 

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12 minutes ago, coldcomfort said:

Yes indeed, what we were guaranteed to continue getting was uncontrolled immigration from the EU, which would have kept the net migration in the 100's of thousands rather than reduced to the 10's of thousands pledged by this government. What we knew we would get as a result is continued pressure on already massively stretched public services, further increasing pressure on GP services already stretched to the absolute limit and yet greater downward pressure on wages. 52% of the country recognised these and other problems associated with being in the EU and decided they did not like what they saw, 48% either decided better the devil you know or like you concluded the potential risks involved outweighed the potential gains. 

The point is no one really knows how this is all going to pan out, but Paul is absolutely right in saying all the doom and gloom (whether business or personal) can and will have a detrimental effect on things overall, creating a feel bad factor rather than a feel good one. Once on that slippery slope it will be very difficult to get off it, so imo it's time for you to recognise and accept we are where we are and pulling in the same direction is the only real option open to all of us. As Paul also alluded too no one in their right mind expects all our problems to be solved the minute we leave the EU, but equally no one on their right mind believes that in this day and age the whole economic and social structure of the UK is going to implode catastrophically either - the reality lies somewhere in the middle and both sides should have equal input into where our sticks are ultimately placed, but meaningful input as opposed to constant looking back in anger. 

 

No CC part of that is somewhat biased and part of the rhetoric given out by the leaders of Brexit - in fact it is indigenous old farts like myself who are the biggest drain on our NHS and GP services, some of whom retire to places like France and Spain relieving the pressure somewhat whilst the majority of the EU people coming in are young and fit requiring less of these services.

Also for those resident in the UK who are not rich enough to belong to BUPA can travel to places like Poland and pay for medical treatment, which I understand to be good, at much lower prices.

Then consider all those working for the NHS as front line staff - we would be lost without them now.

Many of the services such as housing and schools are down to the lack of planning by our own government, local authorities and possibly our own greed culture has something to do with this.

In fact the doom and gloom could be stopped tomorrow if Theresa popped over to Brussels and said, 'most awfully sorry, it has all been a big mistake, we're not leaving after all'.

As it is, it won't happen tomorrow but from my point of view I hope that this is done - despite what you say it is not impossible and it would indeed solve a lot of problems.

As for the economic outlook of the UK this is completely unknown, though probably unlikely an irrecoverable spiral dive in the economy is not impossible - about 100 years ago the economies of Argentina and the USA were on level pegging, same populations and mineral wealth etc - now look at the difference between them. 

Our side is meaningful and although the campaign has cause anger which still exists, it is against the leaders of the leave campaign who for the most part were feathering their own nests and not at the ordinary man in the street voter who cast his according to the information he had, rightly or wrongly but for the most part in good faith; there is a difference.

You have shown that you do mean well in this last post but meanwhile you will have to excuse me on a personal note if I continue to fight my corner which I fervently believe in and sincerely believe it is the right way for the future of our country and make no general excuses for that so we will have to agree to disagree and hope it all comes out well in the wash for all our sakes.

 

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30 minutes ago, coldcomfort said:

Well I think I've found a solution to your problem Mike. Reverese your C/W ratio, or even improve in to 11 months C and 1 month W. Simples really:D 

What's that all about?

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Some people may like this one :)

 

eu dog.jpg

Edited by mike Meehan

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19 minutes ago, mike Meehan said:

whilst the majority of the EU people coming in are young and fit requiring less of these services.

You forget about the increasing strain on maternity units

"1 Between 2000 and 2010 births in England increased by over 114,000 – from 572,826 to 687,007. Immigration has been the key factor fuelling this increase: three quarters of the increase in births was to women born outside the UK. Overall, in 2010, over a quarter of all live births in England were to mothers born abroad. The proportion of such births has grown consistently every year in succession since 1990, doubling over the past decade – from approximately 92,000 in 2000 to almost 180,000 in 2010 – this is nearly 500 on average every day"

http://www.migrationwatchuk.org/briefing-paper/266

 

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Scotland is particularly in need of young immigrants increasing the birth rate. Being in the UK historically drained young people who left in search of a better life, these being replaced by high levels of immigration of elderly people from England seeking a quiet, picturesque place to retire with good, free healthcare provision.

Strong controls on immigration aimed at satisfying the English right would be a disaster so I'm backing Scottish independence with this as soon as possible given brexit.

Edited by scottish skier

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7 minutes ago, interested & confused said:

You forget about the increasing strain on maternity units

"1 Between 2000 and 2010 births in England increased by over 114,000 – from 572,826 to 687,007. Immigration has been the key factor fuelling this increase: three quarters of the increase in births was to women born outside the UK. Overall, in 2010, over a quarter of all live births in England were to mothers born abroad. The proportion of such births has grown consistently every year in succession since 1990, doubling over the past decade – from approximately 92,000 in 2000 to almost 180,000 in 2010 – this is nearly 500 on average every day"

http://www.migrationwatchuk.org/briefing-paper/266

 

Brits should have more sex and more children as they're letting the side down! lol With an ageing population birth rates need to be higher and those paying tax needs to increase to help cover pensions.

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26 minutes ago, scottish skier said:

Scotland is particularly in need of young immigrants increasing the birth rate. Being in the UK historically drained young people who left in search of a better life, these being replaced by high levels of immigration of elderly people from England seeking a quiet, picturesque place to retire with good, free healthcare provision.

Strong controls on immigration aimed at satisfying the English right would be a disaster so I'm backing Scottish independence with this as soon as possible given brexit.

And me go Scottish independence 

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28 minutes ago, interested & confused said:

You forget about the increasing strain on maternity units

"1 Between 2000 and 2010 births in England increased by over 114,000 – from 572,826 to 687,007. Immigration has been the key factor fuelling this increase: three quarters of the increase in births was to women born outside the UK. Overall, in 2010, over a quarter of all live births in England were to mothers born abroad. The proportion of such births has grown consistently every year in succession since 1990, doubling over the past decade – from approximately 92,000 in 2000 to almost 180,000 in 2010 – this is nearly 500 on average every day"

http://www.migrationwatchuk.org/briefing-paper/266

 

How about thinking of the future - if these people are allowed to stay it means that there are still people left to work and support your pensions when you get older - otherwise with an increasingly older average age it will mean less people to work to support more people who are older meaning less to go round for all - in any case properly set you can have ante natal and post natal set up to take a flexible number mothers & babies and if all else fails there is still a possibility of home births, births in taxis, births on aeroplanes and even a birth in a swimming pool I read the other day - ain't nature great - you can't have it all ways.

 

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22 minutes ago, nick sussex said:

Brits should have more sex and more children as they're letting the side down! lol With an ageing population birth rates need to be higher and those paying tax needs to increase to help cover pensions.

What! at the age me and the Mrs are - we've done our bit - my eldest grand daughter is nearly 20 years. :D

 

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2 hours ago, interested & confused said:

You forget about the increasing strain on maternity units

"1 Between 2000 and 2010 births in England increased by over 114,000 – from 572,826 to 687,007. Immigration has been the key factor fuelling this increase: three quarters of the increase in births was to women born outside the UK. Overall, in 2010, over a quarter of all live births in England were to mothers born abroad. The proportion of such births has grown consistently every year in succession since 1990, doubling over the past decade – from approximately 92,000 in 2000 to almost 180,000 in 2010 – this is nearly 500 on average every day"

http://www.migrationwatchuk.org/briefing-paper/266

 

Courtesy of the Evening Standard..... 

http://www.standard.co.uk/news/uk/poles-are-now-largest-foreignborn-contingent-in-britain-as-migration-grows-a3329321.html

Poles are now largest foreign-born contingent in Britain as migration grows

MARTIN BENTHAM 

Thursday 25 August 2016

Net migration has continued at near record levels.

 

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For the benefit of our Scottish bretheren I had to take time out to watch the Edinburgh Tattoo - it reminded me so much of what we owe to those young brave lads and lasses, together with the camaraderie between different countries. Deeply touching.

It reinforces my feelings of how important the EU is even The Royal Guard of Norway was the only other European contingent there.  

We can still keep our traditions which are extremely important and share them with our cousins.

Didn't we have a British Regiment taking part in the Bastille day celebrations in Paris a few years ago?

Edited by mike Meehan

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1 hour ago, coldcomfort said:

Courtesy of the Evening Standard..... http://www.standard.co.uk/news/uk/poles-are-now-largest-foreignborn-contingent-in-britain-as-migration-grows-a3329321.html

 

Poles are now largest foreign-born contingent in Britain as migration grows

MARTIN BENTHAM 

Thursday 25 August 2016

Net migration has continued at near record levels.

 

I draw your attention to my post about 3 before your quoted here:

How about thinking of the future - if these people are allowed to stay it means that there are still people left to work and support your pensions when you get older - otherwise with an increasingly older average age it will mean less people to work to support more people who are older meaning less to go round for all - in any case properly set you can have ante natal and post natal set up to take a flexible number mothers & babies and if all else fails there is still a possibility of home births, births in taxis, births on aeroplanes and even a birth in a swimming pool I read the other day - ain't nature great - you can't have it all ways.

In any case those who are born here and stay will be British, so what's the fuss?

With more mixing of genes we get the stronger people, not like some of those isolated villages which became inclined to inbreeding with its various problems.

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I've always liked the Poles, right back the ones I knew at School who had polish family from the war era.

I just love the Polish section in the supermarket, particularly as I'm a fan of pickles.

It's a close race between that and curries. 

7 minutes ago, coldcomfort said:

Today’s figures also show that 5.6 million people — 1 in 12 people or 8.7 per cent of the population — who are living in Britain is a foreign citizen.

Shows you how small the foreign population is. Just one in twelve. Tiny compared to many countries in the modern world.

Edited by scottish skier

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17 minutes ago, mike Meehan said:

home births, births in taxis, births on aeroplanes and even a birth in a swimming pool I read the other day - ain't nature great - you can't have it all ways.

Obviously babies are one of a few things you can have all ways :D 

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13 minutes ago, scottish skier said:

I've always liked the Poles, right back the ones I knew at School who had polish family from the war era.

I just love the Polish section in the supermarket, particularly as I'm a fan of pickles.

It's a close race between that and curries. 

Shows you how small the foreign population is. Just one in twelve. Tiny compared to many countries in the modern world.

Actually your right that number is quite low . It's just that they aren't spread evenly across the country so this is were the problems with housing schools etc occur   The numbers for me arnt the issue

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17 minutes ago, weirpig said:

It's just that they aren't spread evenly across the country so this is were the problems with housing schools etc occur 

Very much a UK government failing. As I mentioned in an earlier post, lots of Scots have been forced to move to the Middle to South of England to find work in the past because that area was where the wealth and jobs were sucked to based on the economic policies of Westminster governments. Almost happened to me on graduation, i.e. becoming a migrant having to leave my country behind to seek work in South England. That would have been me 'driving up house prices, putting a strain on the English NHS' etc...

Got offered a job near Leicester as a hydrogeologist. Thankfully (no offence, but friends and family were in Scotland obviously) in the end I got into oil and gas via an offer locally at the same time so could stay in Scotland.

If there's one thing I learned about being an economic migrant (or at least almost being one), it's that it's hellishly depressing. Never felt so depressed than when I was down in England alone attending interviews. Nothing to do with England; it's being forced away from home that's crap.

Edited by scottish skier

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57 minutes ago, nick sussex said:

Brits should have more sex and more children as they're letting the side down! lol With an ageing population birth rates need to be higher and those paying tax needs to increase to help cover pensions.

You should come back home Nick, and do your bit. With talk of things like, Scandi highs, Russian highs, strong 'blocks', things digging down, you should be inundated with offers.:D

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 Re the discussion on the bank noliday trade above.....

 I really think this 'problem' (as reported by the BBC) reflects the BBC position.  That to me is the worrying thing!,

How on earth can a 4% fall over a weekend,  be called a major 'hit',. (presumably to our economy)   -  I fail to understand.

Perhaps MIke M has finally sorted them out!

Just for info -  early last friday was very bad in the south and east (and some central areas early on ) with thunderstorms and torrential rain in places. Some places were dry, but were put off by the forecast.

The saturday around here (midlands) we also had rain then thunderstorms and torrential rain

People just ran for their cars in order to get home. So I think its fair bet that it was weather related. An additional factor was the number of people away on UK'cactions. I was away for 3 days earlier in the week (good weather), but my nearest 3 neighbours were all away for the whole week.

I would suggest it just looks like a BAU bank-holiday to me!

It is very strange that the English press (Mail, Express and Telegraph) have all been reporting all weekend of the very good economic news that came out last week and they are reporting even better news can be expected this week, and yet the BBC comes up with this!

We live in times of politically motivated and controlled press, the days when the BBC were impartial has gone (hopefully not for ever!).

The press are no better.

I regularly read the Mail and Mirror. Twice a week I read the Telegraph and Guardian. You would not believe that they are reporting the same story on many occasions. 

No wonder the population are confused and no longer believe what the fear merchants (and over happy BRexiters tell them!).

Symptom of our times, I am afraid .

MIA

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4 hours ago, kar999 said:

MIA asked for a link about the financial services sector concerns and passporting. Heres one I had bookmarked post Brexit.

City of London could be cut off from Europe, says ECB official

London-based institutions could be stripped of ‘passports’ that allow them to sell services to rest of EU, says François Villeroy de Galhau

http://www.theguardian.com/politics/2016/jun/25/city-of-london-could-be-cut-off-from-europe-says-ecb-official

Here's one from Deutsche Bank.

London is likely to lose its financial passport, and investment banks that shift operations abroad quickly will benefit from a "first-mover advantage," according to a confidential Deutsche Bank briefing seen by Business Insider

 

http://uk.businessinsider.com/confidential-deutsche-bank-briefing-where-banks-post-brexit-2016-7

Of course none of this is a done deal. My original post was that I see the doubts as a major economic concern given the UKs huge dependence on the financial sector for GDP jobs and taxes.

For balance, I also have a link from Boris saying that all of the above is ( swear filter for rollocks) scatter cushion but I can't be arsed to post it. Feel free to Google it. :hi:

   Kar..

Thanks for your 2 replies..

I also have been out mowing lawns for a couple of hours!!

Regarding the dollar exchange rate. You are working off forecasts -  if sentiment improves there will be a rapid change in the exchange rates.

I have not met many people who can make money out of long range exchange forecasting!

 

 

Right now the difference is 10%.                                     The tariff imposed on South east Asian goods is 11%.

In future it may be 0% or it may be 4%.

 

 

I still maintain there will be little difference in the price of SE Asian goods  in our shops

Compare this with the 20% increase of EU goods if we decide to leave. Yes it will be 20% plus in this case!

To this must be added the extra money you guys say we will have to pay to the EU to trade with them!

My point is that the option to leave the EU market altogether is not that stupid if we are in any way  'punished'. 

The EU will have to decide how much they want us in!   We cannot change that!

But they will have to realize that we have an alternative which will effect their countries (well the more economically advanced ones),as they lose some of their jobs.

I agree that it may not be seen in that way by many of the smaller countries. That just illustrates to me the difficulties of being inside the EU!! 

 

Re your reply above (thanks), but it gives me little more info than I already knew.

The ECB will say what they are instructed to say.. Like the doom forecasts they issued prior to Brexit (wait a minute that report was issued prior to Brexit!). They are still in project fear mode, and will not go against the Brussels negotiating position line..

Deutsche Bank also have a political view.  However there is in their response above (highlighted) the essence of the debate as it is now being identified.  Passporting was mainly useful when they were setting up the Banks and Finance houses in London.. It was only useful for European banks. It enabled them to travel easily between all the countries.

Now that the banks are established it is not nearly so important. I suspect that if the worse comes to pass, then they will have to apply for an annual  visa.

I see no reason why one should not be given!!.  I expect the issue to be resolved during Brexit discussions.

I think it will not be a major problem,( unless the EU side dig there heels in). Again I see more problems for the already under pressure EU banks if this happens!.

I have heard (read) a lot of stories about how all the European banks are threatening to leave London and to try and establish their own 'city'. Perhaps they might need the passporting arrangements to do this!

It is now generally thought that this would be unsuccessful, after the already announced decisions (post Brexit) of worldwide banks such as HSBC and Wells Fargo are situating in London.   They clearly would like to be where the action is. They do not think it will be Athens, Frankfort or Paris.

Also by way of interest there is talk starting to appear that Switzerland and Hong kong are very interested in setting up a worldwide finance  major hub with the UK.  This apparently has been suggested by the 2 countries and they say they would like to go ahead as quickly as possible should we leave the EU.

It is not all doom and gloom. Not everything is stacked in Brussels tightly closed fist.

As I say it comes down  to how badly the EU wants us to remain as a part of the EC. . We have a perfectly acceptable position to take up if we need too.  We will have to make a choice. It depends upon how well we negotiate, and what we decide the red-lines will be..

(Talking of negotiations - it has now been confirmed that the EU/US trade deal has officially now been suspended -  by the German Finance minister).

The problem is (as Paul has alluded too), is that our negotiating position and options will be reduced if the negative campaign just carries on and on. The UK will not back down from calling Article 50.            The Tories will be slaughtered (forever) if they do!!!   They will not even (now) give parliament a further say in the matter.

Confidence is key. If we are negotiating from a position of weakness then we will all end up worse off. If we negotiate from a strong economic position then we can all benefit.  Our GDP growth (as a percentage) currently is twice that in the rest of the EU.. They will miss us if we leave. We can get by and thrive,  after an initial drop, if we have to leave.

I appreciate that we may have to do this without SS and MM,:D,  but I am pretty certain that they can find (as already revealed by themselves) happiness elsewhere in Europe if they need to.

MIA 

 

Edited by Midlands Ice Age

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Hi MIA. Let's agree on 10% for the Dollar for argument's sake. That still prices up Far eastern goods at 10% more expensive for now. How long now is is unknown but for now that's what we have and it will drive up inflation. It's real. Its happening. Try buying nice shiny electronics from a Chinese eBay seller if you don't believe me. Importing firms are buying dollars forward for 2017 purchases at these higher rates. They won't absorb this cost. They will pass it on.

As for passporting it's all up in the air but even Swiss Banks currently use London for transacting within the EU because Switzerland isn't an EU member. Post Brexit when the UK is not in the EU rules and regulations will force changes. Those are the EU rules for passporting we can't make it up as we go along. Maybe changes can be negotiated for the UKs benefit but with financial centres in Frankfurt, Paris et al breathing down our necks we cannot afford to lose the trillions of transactions each year that currently feed our coffers.

As I say it's not something that can be dismissed lightly. It's impact on our economy is huge.

Edit: You say the EU will miss us with our GDP higher than theirs. Is it no wonder then that our financial sector is so attractive to them?

Edited by kar999

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 Bit more about Switzerland for those interested.

Switzerland has access to only parts of the single market. A big omission is the vast majority of services, including finance. This is despite the fact that the Swiss have spent years trying to get a deal covering them. Its banks, therefore, do not enjoy a passport allowing them to offer their services anywhere in the EU. To do so, they have to locate themselves inside the EU. That’s why so many of them have large operations inLondon.

The Swiss government has itself acknowledged the drawback: “The existing barriers to market access place Switzerland at an economic disadvantage… Swiss financial intermediaries can only expand their EU business by way of subsidiaries in the EU, which means that Switzerland loses out in terms of jobs, value creation and tax receipts.”

Edited by kar999

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1 hour ago, Midlands Ice Age said:

Deutsche Bank also have a political view.  However there is in their response above (highlighted) the essence of the debate as it is now being identified.  Passporting was mainly useful when they were setting up the Banks and Finance houses in London.. It was only useful for European banks. It enabled them to travel easily between all the countries.

Now that the banks are established it is not nearly so important. I suspect that if the worse comes to pass, then they will have to apply for an annual  visa.

Visa ????

It is not humans the passporting is required for, it is for EU wide financial transactions

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Brexit: Loss of passporting rights could halve UK exports

Quote

Research commissioned by Woodford Investment Management, the independent asset manager set up by one of the UK’s best known portfolio managers Neil Woodford, suggests that UK exports of financial services to the EU could be halved by loss of passporting rights following a Brexit.

The report, produced by Capital Economics, estimates that “without passporting rights, it is conceivable that exports of financial services to the European Union could fall by half, or about £10bn (€12.8bn).”

http://www.investmenteurope.net/regions/brexit-loss-of-passporting-rights-could-halve-uk-exports/

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