Post-Brexit Debrief August 19th

Post-Brexit sales boom

In the first round of hard data post-Brexit, retail sales have boomed – up 1.4% against an estimate of 0.2%.  Amongst a raft of positive economic news, the Telegraph says “Shoppers shrugged off June’s shock Brexit vote”.   The Express says “Brexit Boom: Retail sales grew post-referendum as voters went on a shopping spree”.   Both the Pound and the FTSE responded positively to the news.  Another Project Fear prognostication is overturned.   Indeed the Mail headlines “Project Cheer”

Calais Mayor admits violence is “out of control”

The Express headlines “Send in army to stop migrant violence”.  It reports that the Mayor of Calais has finally admitted that the situation is out of control, and has called for more support from the civil authority.

It says that British truckers have called for the Army to be deployed , while a separate piece cites UKIP defence spokesman Mike Hookem MEP, who says “The French government clearly need to bring in the military to help resolve this situation”.

Meantime Merkel defends her “open-door” policy

 

Under increasing political pressure at home ahead of general election next year, Angela Merkel has sought to defend her open-door migrant policy, against increasing public resistance.  She is arguing that Jihadist violence had come to Germany before the policy was in place.  Maybe so, but the policy has brought vastly more numbers, of whom some are Jihadists and many may be sympathisers.  The anti-immigration anti-EU party AfD seems likely to benefit at the polls.

Merkel won’t be helped by reports that migrants in Germany are refusing to work, on the preposterous grounds that they are “Angela Merkel’s guests”.

“City abandons hope of full Single Market access”

The FT reports that senior figures in the City are studying the post-Brexit options, and have rightly recognised that “full Single Market access” (which would almost certainly include free movement and EU budget contributions) is not an option – indeed it would hardly be Brexit at all.  Nor do they seem to favour “the Norway option” which also involves subjection to EU rules plus EU budget contributions.  They are looking at  the same sort of “sectoral agreement” which the Swiss have (similar structure, but of course not exactly the same sectoral deals).

The fact is that the UK has a large trade deficit in goods with the continent, which gives us a strong negotiating position.  But we have an advantage on trade in services.  It seems to me we should say “OK – we’ll give you free access to our market – but in exchange for your advantage on trade in goods, we want an agreement for trade in services – and particularly for “passporting” of financial services, which is at the heart of the City’s concerns”.

Frankfurt eyes UK financial services

The Express reports the thoughts of Thomas Schaefer, Finance Minister in the State of Hesse (which includes Frankfurt), who openly admits that the German city is seeking to attract financial firms from London.

You can’t blame them for that – it’s just common sense.  But I believe they may be underestimating the strengths of the City.  The depth and breadth of financial expertise and support services create a “critical mass” which will be difficult to replicate elsewhere. Meantime (see above) the City, in collaboration with the British government, is getting ready for the Brexit negotiations.

EU students rush for UK universities

The Telegraph reports a surge in applications from EU students to attend UK universities ahead of Brexit – up 11% to a new record. Several thoughts here: education is a major “invisible export” for the UK, and any post-Brexit immigration policy must allow foreign students to come – while ensuring that they also go home afterwards.  But it is also a scandal that non-British EU students can claim the UK’s generous student loans – and in many cases fail to repay them.  Ever.

One of the “benefits” of EU membership touted by the Remainians was the opportunity for British students to study across the EU.  Indeed.  They can go to Strasbourg, or Stockholm, or the Sorbonne.  But they can also go to Sydney or Singapore or San Francisco – with the benefits of sunshine and the English language.  The idea that you can’t travel abroad unless you subject yourself to supra-national governance is palpably absurd.

Italian Referendum “Could be bigger than Brexit”

Italy faces its own referendum in October.  It’s not strictly speaking an EU referendum — it’s about constitutional changes. But in the current anti-government, anti-Brussels mood, it could well be an escape-valve for voter resentment, possibly leading to the fall of the Italian government.  Italy currently faces huge problems of debt, youth unemployment, growth and productivity.  The Five Star Movement, which could benefit from the result, is demanding a referendum on €uro membership.  Some commentators see this as a trigger for a wider EU break-up.

EU woos Algeria

The EU is reportedly cosying up to Algeria, in an attempt to secure gas supplies and also to help to contain the migrant crisis.

Comedy of Errors

The New European” (hands up who’s bought a copy – no? – I thought not) headlines “Brexit turns the Fringe into a comedy of errors”.   Other papers have highlighted the use made of the Brexit vote by comedians in Edinburgh.

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14 Responses to Post-Brexit Debrief August 19th

  1. ian wragg says:

    Until I retired at 70 last year, I was frequently travelling both for work and pleasure. In the Middle east we were paid in dollars and we had a mortgage in the UK.
    Looking back to the exchange rates I see we have had some very low rates
    2011 – Euro 1.12 Dollar 1.46
    2013 – Euro 1.15 Dollar 1.30
    2014 – Euro 1.18 Dollar 1.41
    It seems we have had many Brexit moments over the past 5 years. maybe if interest rates rose as they should we could have a true exchange rate.

  2. Ex-expat Colin says:

    “The French government clearly need to bring in the military to help resolve this situation”.

    Government… is it indeed? They simply need to push back the invaders across their southern and eastern borders. But of course that don’t fit with such a so called authority of the silly liberal variety. They are in Govt to keep the French people safe…but as is common elsewhere, they don’t.

  3. Shieldsman says:

    The EU’s problems are ongoing, the Spectator had an interesting article – Italy’s migrant purgatory – In a car park in Ravenna, you can find the young men we have encouraged to flee to Europe for a better life.
    I wonder who the writer Nicholas Farrell is, not that it matters.
    I do not think the Italian people want the Royal Navy picking Africans out of the Med and landing them in Italy. It is only the UN and stupid PC politicians that want that.

    Richard North has taken to listing the doomsters, there are any number of people and think tanks who know so little their opinion is that Brexit is impossible. As long as the Media will pay, then people will write a load of rubbish.

  4. What’s the army going to do about migrants? Shoot them? That’s not going to play well on news outlets.

    • ian wragg says:

      They could return them from whence they came. It would be a start.
      The alternative is going to be riots on the streets of Europe.

  5. RobtheFox says:

    Of course it is not a post Brexit Sales Boom; the UK is still a member of the EU.

    Post referendum boom it maybe although with those figures came the caveat to be aware that monthly figures tended to be somewhat volatile and these were the result of a fine July following a wet June, the weakness of the £ and the abundance of Sales.
    The forecast is for a slowdown in the UK economy with less favourable purchasing power as inflation increases, earnings are limited by companies having to limit their costs and a rise in unemployment.
    The pound and the FTSE may have responded favourably but sterling is weak and still well down on pre-referendum exchange rates which, of course, also detracts from the actual value of FTSE.
    Perhaps such euphoria, Roger, is a little premature.

  6. Dung says:

    We are not hearing much about the government’s views, ideas or decisions about Brexit are we ^.^

    • RobtheFox says:

      and probably won’t while parliament is in recess….

    • Ex-expat Colin says:

      Here’s some Facebook theory?
      Reuters WorldVerified account
      ‏@ReutersWorld
      BREAKING: Spokeswoman for UK PM Theresa May says article 50 will not be invoked before the end of this year.

  7. lasancmt says:

    Brexit Accelerates the British Pound’s 100 Years of Debasement
    http://www.bloomberg.com/news/articles/2016-07-04/brexit-accelerates-the-british-pound-s-100-years-of-debasement

    Well done ukip for driving the final nails in the UK coffin

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