Brexit - What's happened?

The hard part is over. Enough voters made an educated decision to leave the European Union. The overwhelming majority of voters did so to restore Britain's sovereignty and democracy, and to ensure that in the future British laws are passed by our parliament made up of our citizens.

As usual after an election the a large number of supporters of the losing side are now shouting. And for the most part shouting ridiculous suggestions. The following three are my favorites.

• Hold a second referendum on our membership of the European Union.
• London to become its own independent state.
• Scotland to hold a second referendum on its membership of the United Kingdom.

Lets discuss these points raised by the opposition.

• A second referendum on the UK's membership of the European union seems highly unlikely, regardless of how many signatures the petition of parliament petitions gets. This is because Britain has always been different to the rest of the European union. Other European Union countries have held referendums before and when the public went against the establishment, the establishment asked them to vote again and sometimes even a third time to ensure that they got the vote they wanted, which generally led to closer union. In the UK the public has spoken, and our voice will be heard and the decision of the majority will be honored. As such I doubt this would ever happen.
• The second point where a vast number of residents of London have signed a petition for London to become its own independent state doesn't even warrant discussion. This suggestion is a preposterous as it sounds. It will not happen, regardless of the way the majority of London voted. (I am a resident in London, Newham constituency, and I voted Leave.)
• Scotland holding a second referendum doesn't sound impossible. However, all of their original arguments for leaving the United Kingdom when they held their first referendum on the issue will for a large part now be invalid. As the UK leaves the EU Scotland will no longer be in the EU to suggest a change in the rules where it could be an immediate member. The economy of an independent Scotland would not manage in today's climate, this point is not arguable. Oil prices recovering is now considered $50/barrel. These figures are not anywhere near the values needed for oil to be the industry Scotland needs it to be, and their other economic arguments now our either weaker or outright absurd. 

Onto the result and its immediate ramifications as a whole.

In the mainstream media we saw three 'major' economic ramifications of the UK's actions (it felt like we were being chastised all day.)

Looking below we can see how some of the headlines compares with their one month and one year graphs of their performance. (Granted these basic analysis graph's don't take into account inflation and other factors, however over a year the effects of these are minimal.) 

• 'The cable rate plunged' - GBP/USD. There is no way of a brexiteer sugar coating this. Unless you work for a US company and get paid in dollars. GBP/USD is at a 5 year low, however, this is mostly due to the over confidence of the city and financial institutions investing heavily in the pound late on the 23rd.

  

  http://www.bloomberg.com/europe - 1 Month

  

  http://www.bloomberg.com/europe - 5 Year

  
  

• 'The FTSE 100 plummets' - To give this some perspective see below. We are still above late 2015 figures and well past referendum lows. Still above 6,000 which has only been the case for three periods since the FTSE 100 has existed.

  

  http://www.bloomberg.com/europe - 1 Month

  

  http://www.bloomberg.com/europe - 5 Year

• 'Euro Strengthened' - This Euro rose against the pound, however, still not an awful situation if this stay the same going forward. Economists predict this is a short term effect. If it does stay low then exporting to Europe becomes cheaper.

  

  http://www.bloomberg.com/europe - 1 Month

  

  http://www.bloomberg.com/europe - 5 Year

What we do know for certain is that there were no apocalyptic responses. Nuclear war didn't break out, the four horsemen didn't show up and our economy certainly didn't collapse. Further to this forecasts, now that campaigning is over, suggest that this will all go back to normal. 

I am proud to have voted for us to cease to be a member of the European Union and would do it again. I am also sure that there will be no long term financial negatives from this. 

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