Brexit, for once some facts.

[oldgroaner]

The Express leads with this
"

Unveiling her Brexit blueprint, the Prime Minister will categorically rule out the UK becoming an "associate member" of the EU to ensure tariff-free access to the bloc's single market.
She will make clear she is not in favour of "partial membership of the European Union, associate membership of the European Union, or anything that leaves us half-in, half-out".

The Prime Minister will say: "We do not seek to adopt a model already enjoyed by other countries. We do not seek to hold on to bits of membership as we leave.

"The United Kingdom is leaving the European Union. My job is to get the right deal for Britain as we do."

The question is, how or why do they apparently KNOW what she is going to do?
And assuming that is true, how will she set about convincing the Brexit Voters they are getting what they voted for?
48% know the answer to that already and it's NO
But 52% could end up having to be convinced.. tricky, that!

 

[electric.mike]

Must be me but the fact we cant just pull out without being punished speaks volumes about our EU brethren.
Why dont they just let us go with grace,then our future problems could be held up as an example to any other countries who may want to follow.

 

[oldgroaner]

Must be me but the fact
we cant just pull out without being punished speaks volumes about our EU brethren.Why dont they just let us go with grace,then our future problems could be held up as an example to any other countries who may want to follow.

Why do you imagine we are being punished? this is a blatant lie put out by the press.
Just what proof have you of that other than Newspaper articles?
We were members of the EU
What is happening now is that we are simply excluding ourselves from favourable terms of trade that have to be paid for and certain rules and conditions abided by, so these favourable trading terms are coming to an end, and quite right too, we are not entitled to something we are not prepared to pay for and abide by the conditions that are part of the deal.

Tell me, why are we to continue to enjoy the benefits of Club membership when we are leaving, and how do you read that as punishment?

Please explain the logic, ignoring for a moment what the newspapers are saying, look again at the problem

1. inside the EU we have certain advantages that we pay for and we have to abide by the rules and conditions to obtain.
2. If we stop paying and leave these advantages will automatically cease.

The EU has already said it respects our decision to leave, where does punishment enter into it?
What form of punishment can you point at to prove that they giving us a hard time?
We are the ones making all the noise and crying foul, they are quite happy to let us go and good riddance.

The notion that we are being punished in some way is nonsense.
This is simply the ending of a partnership.
Here is a question for you, if you were running a club and one member wanted to continue to enjoy the privileges of membership but refused to pay the membership fee or abide by the rules, what would you do?
Would you say that's fine you are special and cause uproar among the other members?
No, what you would say is Sorry, but if you want to enjoy Club membership, re apply as an outsider , pay the membership fees and obey the rules wouldn't you?
If you didn't pretty soon the club would fall apart as the other members wouldn't put up with what had been done.
No punishment is taking place we are being treated as we should be.
Once we leave we are outsiders to them and they are free to take any attitude to trade deals that suit them not us.

 

[oldtom]

"The United Kingdom is leaving the European Union. My job is to get the right deal for Britain as we do."

Who will make the determination as to whether or not any 'deal' that may be 'achieved' with the representatives of the other 27 sovereign nation states is acceptable?

If any such 'deal' is placed before the Commons so that our MPs can debate the matter and accept or reject it, I could understand that there would be some kind of democratic process at work. If, on the other hand, Mrs Maybe is set upon just doing whatever her fellow fascists want her to do without any recourse to the nation, then that would be confirmation that democracy no longer exists in the UK. That would set the precedent whereby any political change may be brought about simply by organising a referendum and whatever the result, it becomes policy.

Daft?.......it'll never happen! Well, actually it's not because it gives rise to the potential of being an anarchist's charter and there are some who would exploit such a system to the detriment of their fellow man - they are called right-wing extremists in the present case (tories), but it could be any of the other extremist organisations next time.

Frankly, and particularly in the light of the snap election in NI, I believe the UK as a whole should be having an election ASAP to determine whether or not we should proceed further with 'Brexit' or kick the whole idea into the long grass. It cannot be right that the party representing multi-millionaires and tax cheats should be allowed to determine the future of the UK in such a non-democratic fashion.

Obviously, I haven't heard exactly what the PM's intentions are yet but from the leaks and media commentary, it seems that 'Brexit' is a done deal, regardless of any discussion or negotiation, meaning we are out of the EU, once and for all.

That being the case, what is the point in turning up for meetings with EU representatives at all? It's like the Titanic striking the iceberg; I can swim so wouldn't need a lifebelt straightaway. Lots of others can't swim at all and there aren't enough lifeboats. The water is so cold, it won't make much difference anyway whether one can swim or not - the vast majority will succumb no matter what.

Tom

 

[tillson]

Why do you imagine we are being punished? this is a blatant lie put out by the press.
Just what proof have you of that other than Newspaper articles?
We were members of the EU
What is happening now is that we are simply excluding ourselves from favourable terms of trade that have to be paid for and certain rules and conditions abided by, so these favourable trading terms are coming to an end, and quite right too, we are not entitled to something we are not prepared to pay for and abide by the conditions that are part of the deal.

Tell me, why are we to continue to enjoy the benefits of Club membership when we are leaving, and how do you read that as punishment?

Please explain the logic, ignoring for a moment what the newspapers are saying, look again at the problem

1. inside the EU we have certain advantages that we pay for and we have to abide by the rules and conditions to obtain.
2. If we stop paying and leave these advantages will automatically cease.

The EU has already said it respects our decision to leave, where does punishment enter into it?
What form of punishment can you point at to prove that they giving us a hard time?
We are the ones making all the noise and crying foul, they are quite happy to let us go and good riddance.

The notion that we are being punished in some way is nonsense.
This is simply the ending of a partnership.
Here is a question for you, if you were running a club and one member wanted to continue to enjoy the privileges of membership but refused to pay the membership fee or abide by the rules, what would you do?
Would you say that's fine you are special and cause uproar among the other members?
No, what you would say is Sorry, but if you want to enjoy Club membership, re apply as an outsider , pay the membership fees and obey the rules wouldn't you?
If you didn't pretty soon the club would fall apart as the other members wouldn't put up with what had been done.
No punishment is taking place we are being treated as we should be.
Once we leave we are outsiders to them and they are free to take any attitude to trade deals that suit them not us.

The tone of language being used by the EU's leaders towards the UK is confrontational and is loaded with insinuation that we will be punished for leaving. Other pro-EU contributors to this thread have also indicated that they expect the EU to suffer economic pain after we leave so that they can be seen to punish us and to set an example to other EU countries.

The UK has stated all along that they wish to maintain a relationship with the EU based on friendliness and co-operation. In other words, to be a good neighbour to the EU. This has been greeted with hostility and veiled threats from the EU's leaders, which I believe speaks volumes about the characters in charge.

I think the UK has a more natural relationship with the USA and that people feel closer to and have more in common with the Americans than they do with many member states of the EU. I expect our USA relationship to strengthen over the coming years now that President Trump is in charge, which is a good thing and something that the EU will eye with envy.

People speak about the USA being no friend of the UK and dredge up the war and the financial burden they placed on us afterwards. That was over 70 years ago, different people are involved now. If we are to go back to the war years for our take on a particular country and evidence of its behaviour, lets examine our EU partner, Germany. Now what have they done?

 

[Zlatan]

Must be me but the fact we cant just pull out without being punished speaks volumes about our EU brethren.
Why dont they just let us go with grace,then our future problems could be held up as an example to any other countries who may want to follow.

Good post. Could not agree more. The current situation epitomises one of big faults with eu. Any dealings are with 28(27?) disparate states...camel designed by committee and all that with god knows how much red tape..
Like Trump said..deal with USA you are dealing with him..
Flecc
For FTSE to perform well 2 criteria must be met. Companies must show profit and confidence for them to continue to do so must be high. My point was both 100 and 250 have done great. There has not been a run on UK companies, which would be reflected in 250 and to a lesser degree on 100..

 

[oldgroaner]

"he tone of language being used by the EU's leaders towards the UK is confrontational and is loaded with insinuation that we will be punished for leaving. Other pro-EU contributors to this thread have also indicated that they expect the EU to suffer economic pain after we leave so that they can be seen to punish us and to set an example to other EU countries."

I have already explained the situation in clear and simple terms, yet you persist in denying what is obvious; this notion of "Punishment" is propaganda from the right wing press,and is Daily expanded and embroidered ad nauseum.

"People speak about the USA being no friend of the UK and dredge up the war and the financial burden they placed on us afterwards. That was over 70 years ago, different people are involved now. If we are to go back to the war years for our take on a particular country and evidence of its behaviour, lets examine our EU partner, Germany. Now what have they done?"

Since we have been at war with all of those nations in some cases many this too is nonsense and you know it.
The Americans are friends of ....the Americans, no one else.

 

[KTM Bike Industries UK]

Must be me but the fact we cant just pull out without being punished speaks volumes about our EU brethren.
Why dont they just let us go with grace,then our future problems could be held up as an example to any other countries who may want to follow.

we're not being punished... we're loosing the benefits of the members ship of the club we were once in.

You can't still use the facilities at the gym once you quit... that isn't the gym "punishing you".

The fact that you can see that leaving is going to leave us "punished" shows that there were a lot of positives we're about to loose.

 

[KTM Bike Industries UK]

For FTSE to perform well 2 criteria must be met. Companies must show profit and confidence for them to continue to do so must be high. My point was both 100 and 250 have done great. There has not been a run on UK companies, which would be reflected in 250 and to a lesser degree on 100..

You're lack of understanding on how this and other international trade works is starting to show though, and you do need to do some more research.

These companies are showing higher values because a lot of their assets / property, businesses etc etc are not in the UK, the company might be UK owned but a high % of its business will be over seas. So when the £ drops in value, if nothing else changes all their overseas business is suddenly worth a lot more £s, whilst their UK bit is still worth the same number of £s, so their value goes up a lot!. This is why the top UK companies, ie the ones with the most investment oversears appear worth more when the £ drops.

The other thing is that their UK assets are now discounted for foreign buyers so the UK is currently sold. Things like the National Grid, are now owned by the Chinese...

https://www.ft.com/content/6f421412-bd00-11e6-8b45-b8b81dd5d080

This is because they are getting UK stuff super cheap because its worth less and less as the £ falls in value.

A high FTSE isn't really a good thing, it you look at what's causing it... which is the weak £.

 

[KTM Bike Industries UK]

Inflation is starting to go up, as predicted.

http://www.bbc.co.uk/news/business-38649676

Most trade prices in the industries I know have gone up more than once now and in total of about 15%, so if that is mirrored across all the import industries which is pretty much has to be... it can't be avoided. Then this inflation rise will continue until we settle into the new normal pricing, if the £ settles.

 

[Woosh]

Like Trump said..deal with USA you are dealing with him..
..

Wow. I wish he'd be gone by the time we sign a new deal with the USA.

Would you want to deal with someone who is so inconsistent and goes easily back on his promises like Mr Trump?
If you ever upset him, he may instantly slap a 45% border tax on your products by tweets. Think about that.

 

[Zlatan]

Wow. I wish he'd be gone by the time we sign a new deal with the USA.

Would you want to deal with someone who is so inconsistent and goes easily back on his promises like Mr Trump?
If you ever upset him, he may instantly slap a 45% border tax on your products by tweets. Think about that.

I agree with you , was using it as an example of the concept rather than individual involved, besides is he any worse than our friend Junkers..? I dont think so..

 

[Woosh]

Deals are deals. I am sure we'll do deals with the EU after brexit.
They need us just as much as we need them.
There is no need for the kind of language of the Express.

 

[tillson]

You're lack of understanding on how this and other international trade works is starting to show though, and you do need to do some more research.

These companies are showing higher values because a lot of their assets / property, businesses etc etc are not in the UK, the company might be UK owned but a high % of its business will be over seas. So when the £ drops in value, if nothing else changes all their overseas business is suddenly worth a lot more £s, whilst their UK bit is still worth the same number of £s, so their value goes up a lot!. This is why the top UK companies, ie the ones with the most investment oversears appear worth more when the £ drops.

The other thing is that their UK assets are now discounted for foreign buyers so the UK is currently sold. Things like the National Grid, are now owned by the Chinese...

https://www.ft.com/content/6f421412-bd00-11e6-8b45-b8b81dd5d080

This is because they are getting UK stuff super cheap because its worth less and less as the £ falls in value.

A high FTSE isn't really a good thing, it you look at what's causing it... which is the weak £.

A lower valued £ isn't necessarily a bad thing. It is currently below where it should be, but I think it was probably over valued prior to the referendum.
The FTSE 250 is interesting. Post referendum, when the 100 index rose and the 250 went down, all focus was on the 250 index and how that was the barometer by which we should forecast out country's economic future.

Below are a selection of comments, which took about 30 seconds to find, regarding the FTSE 250 index when the news didn't look so good. As you will see, great importance was attached to the FTSE 250.

Now that the FTSE 250 is doing well, its importance is being played down. Interesting.

There is no doubt, BREXIT comes with some difficulties and some disadvantages. The same can be said for EU membership. It is a case of judging which has the best overall outcome and for me, out of the EU is the way forward.

I think the examples below illustrate how fixated on the negative we can become. Eagerly hoovering up the bad news like veracious vacuum cleaners, only to move onto the next "bad thing" when the original "bad thing" doesn't turn out to be that bad.

Try a more holistic approach and consider the good points too. Compare and contrast, its the way forward.

QUOTE="trex, post: 312856, member: 5652"]there is worst, half of the FTSE failed to open for trade. Whoever has money invested on the stock market must be worried sick.[/QUOTE]

I'm sure the market will take a big dive today. There are no positive indicators.
.

The FTSE 100 isn't a reliable guide to the current situation since it includes such a large foreign trade content which is influenced in both directions by it's spread.

The FTSE 250 is a much better reflection of the UK's interests. That dropped sharply on the result but has recovered a third since:

Chart Link
.

I think you don't get it. You should take the FTSE250 as a guide for the UK economy, not the FTSE100. The FTSE250 reflects investors confidence in the UK economy in the 2 and a half year brexit scenario
.

The whole tone of the media is now anti Brexit,the article from the guy at the LSE stating that no prime minister would want to preside over the break up of the UK,the markets have now assumed no Brexit by pricing up the FTSE 250 and the £ v dollar,still low but going the opposite way to all the banks were forecasting.
KudosDave

 

[KTM Bike Industries UK]

They need us just as much as we need them.

This, is the kind of quote I really need someone to explain to me.... so please help me.

My understanding of the situation.

numbers taken from here: https://fullfact.org/europe/uk-eu-trade/

53% of our imports come into the UK from the EU (we're part of this because KTM come into the UK from Austria) so I understand how this works.

47% therefore comes into the UK from outside the EU (we've imported loads from outside the EU over the past 10 years so I also understand how this works)

So we in the UK get 53% of our imports from the EU, so things like BMW and KTM, as two examples.

We in the UK need these products from the EU, because we are a developed nation we want / need the premium goods that brands like these provide. There is no alternative really, well not one that we don't already have access to. We can already get access to everything from around the world, so we need the EU to provide us with the EU brands we like.

If/when we leave the single market, we'll just be importing from the EU like we do from outside currently... so we'll still need the EU brands we'll just pay duty / handling fees on the imports. So the source factory / company will make the same money, it'll just cost the UK consumer more money for the same product.

So in my eyes as an importer from the EU, I don't think they "need" us, they can still sell to the rest of the EU, and they can still sell to the rest of their world via the 63 trade agreements they have in place.

When we leave we'll loose all these trade deals.

So I don't think the EU needs us, their companies might actually benefit from us leaving because they will suddenly not be having to compete with UK businesses for sales within the EU, and equally they will suck up the sales to the other 63 countries that we currently sell to, because we won't have trade deals in place.

So then we look at what we need the EU for. The EU is currently a big market for us, and also gives us access to 63 other trade deals. If / when we leave we'll loose all these so our exports to the EU will no longer be competitive with their own internal suppliers and we'll suddenly be competing with the EU on the global market place.

So there's my understanding.

So can you explain to me why you think the EU needs us just as much as we need them please. I really want to understand this logic.

 

[Woosh]

Re footsie 250. A year ago, it was roughly 16,000 and currently at 18.250. About 14% up. That is roughly in line with asset re-evaluation based on the Euro 13% dearer and the Dollar 20% dearer. Not much pre-brexit jitters either way.
Woosh for example, have to give a stock valuation at the end of this financial year. I can choose historical cost or replacement cost for this. If I choose the lower historical cost, then the difference will have to be posted as profit. The end result is always a healthier balance sheet.
Either way, turnover goes up because of higher prices, profit goes up. Trading businesses do not suffer from the lower value of the Pound instantly. The problem is uncertainty, that does not show on the balance sheets.

 

[Woosh]

This, is the kind of quote I really need someone to explain to me.... so please help me.

My understanding of the situation.

numbers taken from here: https://fullfact.org/europe/uk-eu-trade/

53% of our imports come into the UK from the EU (we're part of this because KTM come into the UK from Austria) so I understand how this works.

47% therefore comes into the UK from outside the EU (we've imported loads from outside the EU over the past 10 years so I also understand how this works)

So we in the UK get 53% of our imports from the EU, so things like BMW and KTM, as two examples.

We in the UK need these products from the EU, because we are a developed nation we want / need the premium goods that brands like these provide. There is no alternative really, well not one that we don't already have access to. We can already get access to everything from around the world, so we need the EU to provide us with the EU brands we like.

If/when we leave the single market, we'll just be importing from the EU like we do from outside currently... so we'll still need the EU brands we'll just pay duty / handling fees on the imports. So the source factory / company will make the same money, it'll just cost the UK consumer more money for the same product.

So in my eyes as an importer from the EU, I don't think they "need" us, they can still sell to the rest of the EU, and they can still sell to the rest of their world via the 63 trade agreements they have in place.

When we leave we'll loose all these trade deals.

So I don't think the EU needs us, their companies might actually benefit from us leaving because they will suddenly not be having to compete with UK businesses for sales within the EU, and equally they will suck up the sales to the other 63 countries that we currently sell to, because we won't have trade deals in place.

So then we look at what we need the EU for. The EU is currently a big market for us, and also gives us access to 63 other trade deals. If / when we leave we'll loose all these so our exports to the EU will no longer be competitive with their own internal suppliers and we'll suddenly be competing with the EU on the global market place.

So there's my understanding.

So can you explain to me why you think the EU needs us just as much as we need them please. I really want to understand this logic.

EU integrated manufacturing accounts for a fair amount of trade with the EU. We export to Rotterdam then Rotterdam re-exports to other destinations. I don't have the numbers but as a guess, some 20%-25% of our EU trade is just shuffling freight, the core trade is obviously lower after brexit without hurting income.
If you look at the growth differential between the EU and the rest of the world, it is clear that we do not need the EU as much as we seem at the moment. For example auto parts can come directly from Mexico, Malaysia etc. no double counting. As far as our fintech is concerned, I am sure our city boys know what to do.

 

[KTM Bike Industries UK]

EU integrated manufacturing accounts for a fair amount of trade with the EU. We export to Rotterdam then Rotterdam re-exports to other destinations. I don't have the numbers but as a guess, some 20%-25% of our EU trade is just shuffling freight, the core trade is obviously lower after brexit without hurting income.
If you look at the growth differential between the EU and the rest of the world, it is clear that we do not need the EU as much as we seem at the moment. For example auto parts can come directly from Mexico, Malaysia etc. no double counting. As far as our fintech is concerned, I am sure our city boys know what to do.

That doesn't make a lot of sense to me.

The only two companies I have close ties with european HQs in the UK are very very serious about moving to the EU post brexit. They are only in the UK to access the EU market place. Loosing the UK from the EU won't make a big % difference to their sales, but having to export from the UK into the EU will. So they will move to the EU and take their jobs with them. So the UK will suffer from this as well.

If we're outside this single market, they won't export to Rotterdam from the UK, they will simply move operations into the EU.

 

[Zlatan]

Good posts from Tillson and a very balanced fair one from Woosh.
I think confidence in country is way higher than generally portrayed on here.The 250 sort of suggests similar. I also think with the continual bombardment of countries abilities outside EU by many individuals on here has created a downward spiral of optimism on thread...
UK can and will thrive out of EU, with or without access to single market.

Some folk revel in pessimism. In 80:s we were all going to die from aids. In 90's country would go bankrupt if we left. ERM , and same if we didn't join euro . At turn of century all computers were going to meltdown...what happened in each case...well not what was predicted by many.
What normally happens is somewhere between 2 extremes....unless Blair gets involved...

 

[Wisper Bikes]

I am just not getting this.

Lets assume our profit margin was 10% and we pay in USD. If the GBP has been devalued by 20% would that not mean my 10% margin would turn into a 10% loss?

If we were importing a couple of 40' containers a month and our costs have gone up 20% wouldn't that mean we would be losing 10% on each container sold?

Would that not mean to maintain my margin I would need to increase prices by 20% less 2% for increased turnover?

Maybe I am being too simplistic? If this is not the case I would be absolutely delighted to find out why.