May could kick Brexit into the long grass.

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al_yrpal
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Re: May could kick Brexit into the long grass.

Postby al_yrpal » 18 Jul 2016, 7:55pm

This leavers attitude is that a modest devaluation from where the £ stood is nothing to worry about too much, but a large sustained devaluation or appreciation would be. In times of uncertainty the markets are like an excitable person, they over react. Plus, there are all sorts of financial whizzos shorting the currency driving the value further down. Then, there is the bounce and stabilisation at a new value.
Prudent businesses like my friends European holiday business have future options on lots of Euros so the effect of a £ devaluation is heavily cushioned enabling him to adjust prices on future bookings, thus maintaining his gross profit and able to pay the wages of his Europe based staff. Plan ahead and don't panic…

Al
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Flinders
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Re: May could kick Brexit into the long grass.

Postby Flinders » 18 Jul 2016, 7:56pm

Ben@Forest wrote:
53x13 wrote:I'm not suggesting brexit won't happen, I'm simply pointing out that there are many different routes to brexit, and it may be some time before brexit is triggered (and extensions to the 2 year period can be given ad nauseaum by the Commission). I'm not convinced that this government will be able to effectively or diligently deliver a good exit for the UK. Imo it'll take another general election and a new administration (if Brexit negotiatons go badly, and they probably will) we'll have both, long before 2020


Whenever I see this type of comment I'm reminded of the doomsayers after the 2010 coalition was agreed. Many, especially centre-left or left-wing, journos or commentators on forums exulted in the fact that the coalition would not last 12 months.

We now know that not only did it last but that the relationship between Cameron, Osborne, Clegg and Alexander (initially Laws for a very brief period) was professional and workmanlike, and indeed far better than the relationship between Blair and Brown. May is a pragmatist, EU negotiators will be pragmatists. I'm sure both parties will compromise and to the extent modern politics 'works' it will work.


I didn't think it would last, but that's because I vastly underestimated the dishonesty of the LDs and their thirst for personal office at any cost.

Flinders
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Re: May could kick Brexit into the long grass.

Postby Flinders » 18 Jul 2016, 8:01pm

al_yrpal wrote:This leavers attitude is that a modest devaluation from where the £ stood is nothing to worry about too much, but a large sustained devaluation or appreciation would be. In times of uncertainty the markets are like an excitable person, they over react. Plus, there are all sorts of financial whizzos shorting the currency driving the value further down. Then, there is the bounce and stabilisation at a new value.
Prudent businesses like my friends European holiday business have future options on lots of Euros so the effect of a £ devaluation is heavily cushioned enabling him to adjust prices on future bookings, thus maintaining his gross profit and able to pay the wages of his Europe based staff. Plan ahead and don't panic…

Al

the markets have only bounced back because they think May will wriggle out of leaving. If that's not the case, just you wait, it will be a rough ride. Business confidence is already at its lowest since the start of the crash, and over 80% of businesses are cutting planned investment, and a simila proportion are either shedding staff, or scrapping plans to take on staff. I know of several people who have already lost their jobs, all highly qualified; their jobs are going abroad (Germany, probably). Research funding is in crisis, the UK is being avoided when it comes to long term jointly funded projects, and well qualified staff are leaving or scrapping job applications here to work abroad.
In fact, exactly what we remainers told you would happen.

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al_yrpal
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Re: May could kick Brexit into the long grass.

Postby al_yrpal » 18 Jul 2016, 8:12pm

Thats not the reason. A lot of FTSE companies are truly international, thats the reason for the market rise eg BP, BATS, Pearson, Glaxo etc. As for all these assertions, nothing concrete in the newspapers. The lower £ helps TATA. Dont panic!

Al
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Tiberius
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Re: May could kick Brexit into the long grass.

Postby Tiberius » 18 Jul 2016, 9:19pm

the markets have only bounced back because they think May will wriggle out of leaving.



I have been involved with 'The Markets' for over thirty years.....They work on fear and greed (call it 'confidence' if you like)

Like water, they WILL find their own natural level. There is nothing whatsoever to get worked up about.



'

pete75
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Re: May could kick Brexit into the long grass.

Postby pete75 » 18 Jul 2016, 9:27pm

Tiberius wrote:
the markets have only bounced back because they think May will wriggle out of leaving.


I have been involved with 'The Markets' for over thirty years.....They work on fear and greed (call it 'confidence' if you like)

Like water, they WILL find their own natural level. There is nothing whatsoever to get worked up about.



It is for someone with a market based pension fund particularly if they want to buy an annuity. Caught in a double whammy, fund value down and annuity yields now very low.

53x13
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Re: May could kick Brexit into the long grass.

Postby 53x13 » 18 Jul 2016, 9:37pm

Tiberius wrote:Al

the markets have only bounced back because they think May will wriggle out of leaving.[/quote]

Utter rubbish.

I have been involved with 'The Markets' for over thirty years.....They work on fear and greed (call it 'confidence' if you like)

Like water, they WILL find their own natural level. There is nothing whatsoever to get worked up about.



'[/quote]

I don't think May will wriggle out of leaving, because I don't think the current administration has put the people in play to be even able to start to negotiate. Gove, Davis, Johnson? It seems big Theresa has a sense of humour after all. It's going to be a long, arduous process and it's unprecedented, two years is a ridiculously short period.

I can't see article 50 being invoked while the Scottish indyref 2 might succeed. Which is a serious possibility that May has already signalled. So brexit, or a negotiated exit likely 3-3.5 years away (and the EU can grant an extension on this up to 7 years discretionary). So likely no settlement before the next GE.

If it all goes to the wall (and with the three clowns above doing your bargaining, likely so) then a GE will be upon us long before then. I'd expect either a new Remain party, or an established party campaigning on another way. Probably a Brexit lite, or possibly another referendum.

Second and third referenda are normal occurrence in Europe, and the Scots will definitely have another one in the next 12 month (they're looking to pick ANY fight with Westminster). I can't see a second Scottish referendum failing. Even if it does I think there's probably a window of opportunity for a THIRD indyref, before Brexit is concluded. Nicola smells blood and she won't give up till the SNP get the result they want for Scotland.

So I ask again, what then for a much reduced rUK? No oil, no gas to go to the markets with, a very diminished Financial Services industry as London drifts to better, warmer homes in the European capitals, a starved manufacturing base (of investment), and trade deals that are so far off as to make them fanciful? Add to this the tit for tat as we try to close down our borders to new immigrants...

Some people here just can't face the enormity, nor reality, nor the sheer stultifying complexity of what's to come, so they prefer to paint it all bread and circuses. I'm realistic about the sheer miasma of complex issues that need to be resolved, before we can even initiate Article 50.

Bread and circuses didn't work out for the Roman Empire, and it's not going to get us over the wall of the real work that has to be done, considering the three people least able to do it.

Diplomatic they are not.
Last edited by 53x13 on 18 Jul 2016, 10:51pm, edited 3 times in total.

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al_yrpal
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Re: May could kick Brexit into the long grass.

Postby al_yrpal » 18 Jul 2016, 10:10pm

FTSE 250 is back where it was too.

Institutional investors are underinvested in the UK
Volatility will continue, but any dips could be heavily bought
Sterling weakness will support overseas earners
Ultra-low interest rates and bond yields are here to stay
Equities will therefore attract income seekers, while dividends can be reinvested to boost growth

You can now cash your pension fund in, invest in dividends from a wide range of big companies, cut out the middle man and enjoy a better pension. If you preserve tbe capital you can spend it your dotage and possibly pass some on to your kids. Any excuse to cut annuity rates and the banksters will do it.

Al
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kwackers
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Re: May could kick Brexit into the long grass.

Postby kwackers » 19 Jul 2016, 8:52am

al_yrpal wrote:FTSE 250 is back where it was too.

Wahoo!
Things are back to where they were!

It's amazing how that's considered a success story - especially considering nothing has happened yet and we've yet to see any data on what has really happened to the economy (I personally know of at least one contract that has been cancelled and a couple more on hold).

Economists promised us a short sharp shock and we got one. 100% success on predictions so far, lets hope they were wrong about what actually leaving the EU meant.

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Re: May could kick Brexit into the long grass.

Postby al_yrpal » 19 Jul 2016, 9:02am

But… the naysayers are back. IMF forecast is downcast adversly affecting the £ and markets. Expecting many bumps ahead. But, its earnings that count long term so keep an eye out for bargains.

Al
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reohn2
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Re: May could kick Brexit into the long grass.

Postby reohn2 » 19 Jul 2016, 11:01am

I saw the news on ARM's take over as being a 'success'.
Since when was the take over of one the world's most successful UK companies by a foreign company a 'success',and a show that the world hasn't turned it's back on the UK,post brexit :?
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kwackers
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Re: May could kick Brexit into the long grass.

Postby kwackers » 19 Jul 2016, 11:18am

reohn2 wrote:I saw the news on ARM's take over as being a 'success'.
Since when was the take over of one the world's most successful UK companies by a foreign company a 'success',and a show that the world hasn't turned it's back on the UK post brexit :?

"I want my country back"
What they failed to realise is their country has been sold off piecemeal over the last 30 years. It's long gone, not because a German doctor is working at the local hospital but because consecutive governments have sold everything of value in order to keep taxes for the wealthy low.

ARM had a benefit to this country as a demonstration of our technical ability. It's price was an indication of the IP it held, this IP has been sold abroad and will be milked for every penny.
In the meantime part of the deal means they promise to increase the size of the workforce, that adds a small premium to the cost of purchasing the company so even if they honour the promise it doesn't mean that much. ARM's best hope is they can come up with enough innovation over the next few years to make them worth hanging on to, if not disbanding or moving the chip design somewhere cheaper is how most of these deals play out.

Still, $32Bn into the economy isn't to be sniffed at. I know a few people who will have benefited.
Lets hope some of that money doesn't just disappear into wealthy OAP's coffers and offshore accounts but actually gets spent on stuff.

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Re: May could kick Brexit into the long grass.

Postby Psamathe » 19 Jul 2016, 11:28am

al_yrpal wrote:£ is bouncing back...

Immediately after the leave result the pound crashed to 1.367 against the US$. Today it's 1.318 (significantly lower). This is a "bounce back"?

Ian

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Re: May could kick Brexit into the long grass.

Postby Psamathe » 19 Jul 2016, 11:36am

reohn2 wrote:I saw the news on ARM's take over as being a 'success'.
Since when was the take over of one the world's most successful UK companies by a foreign company a 'success',and a show that the world hasn't turned it's back on the UK,post brexit :?

I was disappointed by Hammond's (Chancellor) response along the lines of this demonstrating that overseas investment will continue to flow into U despite Brexit. ARM must be one of the UK companies least affected by Brexit (nature of their business) - and Hammond not appreciating this does not seem to have stopped him. Worrying in a Chancellor.

Ian

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Re: May could kick Brexit into the long grass.

Postby al_yrpal » 19 Jul 2016, 12:14pm

Psamathe wrote:
al_yrpal wrote:£ is bouncing back...

Immediately after the leave result the pound crashed to 1.367 against the US$. Today it's 1.318 (significantly lower). This is a "bounce back"?

Ian


Yes, a bounce from 1.27. Expect more slides and bounces.

As for ARM, a company that needs investment to continue its success. As usual the banksters in tbe City arent coming forward, too busy on their Playstations spread betting and shorting stuff. So, like many other originally British businesses it takes foreign money to back British innovation and design to prosper. Think Jaguar Landrover. I agree its appalling, but, thats the City, full of people with only one god and no imagination whatsoever. The Germans call them locusts.

Al
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