Wednesday 28 November 2018

Hammond "the end is nigh.."

Eternal lead remoaner and all round Mr. Average Chancellor Philip Hammond is today touring the media studios warning about how terrible Brexit is. If there is one thing about Brexit that we can all agree on it is that the UK equipping itself with two remainers to lead it out of the EU has been the worst part of the entire story - it just guaranteed a bad and failed negotiation.

However, today Mr Average is at it again, bleating on about new 'old news' news that Brexit might be a bit shit for the economy. Well, this is a real game changer as I myself can't ever recall anyone having made this point before and surely if they had done pre-referendum then the vote would have gone the other way.

Anyhow of more interest is that the markets are really taking all this news in their stride and that is a bit odd really. The Government is bereft of even a majority in the house, it will fail to pass its Brexit deal and we will be on course for a Brexit or Remain showdown in the early months of 2019.

Perhaps the markets are as bored of Brexit as most of the populace?

Some might say that there has been a reaction, but this is not true over any longer term view. There is small drop of late but that is nothing compared to the 5 year trend when the economy has been in first gear at best most of the time.

2018 FTSE Year to Date - slightly down on the year but not much and Santa Rally ahoy!

5Yr FTSE Performance, nothing to see here


Anonymous said...

I don't think anyone believes a word these zombies say.

Don Cox

John in Cheshire said...

The biggest problem I have with our lying politicians, Civil Service and MSM is that for them, actions do not have consequences. They do what they do and say what what they say because they are not fearful of us, their paymasters.
If we are to actually take back control of our country, that has to change.

andrew said...

The charts show the limits of state control. Much as politicians of all varieties like to think that they make a significant difference.
I do not think that has been true since the late 70s.
Even the 08 crash and QE fuelled recovery is a notch in that chart over 30 years.
Businesses generally just get on with it.

Undoubtedly we will be worse off. On best estimates between 3-8% worse off in ~10 years. The thing is there will be no next door neibhour who is 3-8% better off than you. Your income will grow from 25k pa to 31k over 10 years rather than 34k. but that 34k number is just illusory really.
- Which is why no-one cares apart from PhilH.

What we should be concerned with is how our ecomomy performs compared to our peers (france, germany, holland, sweden, usa) over the next 10 years.
No one seems to be asking that question.
Remaining means about the same as France / Germany
May's deal means a bit less than France / Germany
No-Deal is a coin toss really.

personalmusing said...

I think every investors can see that no deal will be fine. Maybe if you are trading sterling fx vol across the late march to mid april window then you want to be careful. Outside of that, the no-deal disasters are all predicated on no fixes: i.e. if a door is closed you will keep walking into it and banging your head rather than find another way.

Corbyn is a definite drag on high end residential investment as that is a static long lived asset.

The withdrawal agreement sucks for people in the UK, but it is relatively big corporate friendly and long term decline isn't a big issue for the markets as npv puts most of the value upfront. Not such a good thing to sign if you care about your kids though.

Jan said...

Project fear............yawn

Why does no-one ever mention the opportunities to be had if we leave the EU which is like a millstone around our necks?

I don't think anyone ever thought we wouldn't be a bit worse off in the short term but in the long run the world is our oyster.

E-K said...

"Remaining means about the same as France / Germany
May's deal means a bit less than France / Germany"

I differ on that, Andrew.

If we remain, in either form, the EU will pick us apart at leisure.

We are also to be their dumping grounds. Expect the super-sized Med dinghies soon. Geldoff chartering rescue yachts too.

I knew it would happen but I'm shocked to see the Daily Mail now reading like a nasty version of The Guardian. There's no market for this - it will tank. (I've even stopped visiting its web pages for fear of giving it revenue.)

Remain are cornering every bit of the media. Every TV/radio panel has Leavers outnumbered 4:1 and they say "It's because we can't find the quality of Leaver we need."

I was disappointed with John Redwood re the ERG failure. "This is not about judgment of the Prime Minister." Weasel words.

andrew said...


If we remain, we retain some control over the rules and there is no great advantage to the EU to disadvantage a part of itself.

If we (may's deal) remain / leave in name only, we get no control over the rules, but they apply to us and those rules can be shaped to target us and there _is_ an incentive in the EU to advantage a part of itself at the cost of an outsider - because it is easier to 'steal' than to 'build'.

This is not to label the EU as evil, just human. When we had an empire we undermined India's textile industry between 1700 or so to when industrialisation was widespread in 1870 or so to help out the UK's industry.

Peter MacFarlane said...

All this endless navel-gazing about whether we'll be 1% worse off out of the EU or 1.8% - and after x number of years too, as if anyone could predict...

Do the Remoaners really think we decided how to vote based on whether we'd be a tiny fraction better or worse off? Really?

Having no principles themselves, I suppose they simply cannot grasp the concept of self-government, or understand why it matters to, oh, around 17 and a half million of us.