EU Referendum - in or out?

[Alistair Campbell]

A quick referendum is very likely a good idea for Scotland. If they end up formally leaving the EU as part of the UK it'll be terribly hard to get back in again. England outside the EU is big enough to survive reasonably, Scotland much less so.

I'm not sure it is that straightforward, or that desirable.

It is not clear how Scotland could negotiate to stay whilst rUK exits. The only precedent was Greenland seceding, which was a different kettle of fish.

Going indy on the assumption that speedy accession (or succession) would be granted would be a gamble. Normally new entrants would need to adopt the Euro, or at least have their own currency, a central bank, and an apparent track-record of fiscal rectitude. Our effective deficit may count against us. Junking your biggest trading market for your second biggest market (and losing both) might prove problematic.

[Christopher Kreuzer]

2:50pm

FTSE 100 only down 2.42%

markets always initially overreact before correcting themselves

easy money to be made for some

The difficulty is in predicting the 'dips' and 'corrections'. Over the coming weeks and months, as various organisations announce their reactions and concrete plans and changes in plans, and various economic figures are published, the market will react to those. That will be the point at which we will know what the true effects will be. The long-term prognosis could still be very bad. If, for the sake of argument, the UK economy does start to contract and keeps contracting, what then? Where will all the brave-new-world people be then? (Of course, let's hope it doesn't happen, but it could, no-one really knows.)

[NickFaulks]

Come on Nick, this is not going to help the economy in the short term.

Where have I said that it would help the economy in the near term ( except perhaps through a more competitive exchange rate, which is not very significant anyway )? The truth is that in the short term I don't think it will make much difference. There will be a few high profile cases of foreign organisations cutting local workforces, but my guess is that those decisions will have been taken already and they have only been waiting to see whether Brexit could be used as cover.

I do believe that in dealing with the outside world who want to buy our stuff and to sell us their stuff, the two year transition period should be long enough to get the deals done.

[Christopher Kreuzer]

Incidentally, why was two years picked as the duration of the transition period? Whoever drafted the Article 50 provisions (the formal leaving mechanism), I'm guessing they may not have considered that bit closely. Is two years too much, too little, or just right? There are provisions to extend it further if needed, but only with the agreement of all parties (which will be unlikely).

The interesting question will be when the UK triggers Article 50 - after a Conservative leadership election? Is there a good argument that a new general election is needed before any Article 50 trigger is pulled? What if the other 27 EU members want things to move faster (as they have already said)?

[Mick Norris]

The stock market reaction has surprised me; specifically how the UK is holding up compared to some other countries (which, I accept, are somewhat random selections):

UK: FTSE down 5%
Germany: Dax down 7%
Japan: Nikkei down 8%
France: CAC down 8%
Spain: Down 11%
Italy: Down 11%
USA: Dow Jones and Nasdaq down about 3%, but not been open very long.

FTSE 100 companies make most of their money overseas, and the FTSE 100 is currently down 2.36%

FTSE 250 is a better barometer of UK Companies, and is currently down 6.7%

Agree, could have been worse, and may be on Monday

I have loads of these, but e.g.
AJ Bell

[NickFaulks]

If, for the sake of argument, the UK economy does start to contract and keeps contracting

That could happen, but if it does it will be our fault, nobody else's. Our economy has never depended upon Europe and doesn't now, except insofar as the EU's protectionist policies make it harder for us to trade with the rest of the world.

Meanwhile, Europe's economies really are in a death spiral, from which there is no escape while they remain shackled to their dysfunctional currency.

[Christopher Kreuzer]

If, for the sake of argument, the UK economy does start to contract and keeps contracting

That could happen, but if it does it will be our fault, nobody else's. Our economy has never depended upon Europe and doesn't now, except insofar as the EU's protectionist policies make it harder for us to trade with the rest of the world.

Meanwhile, Europe's economies really are in a death spiral, from which there is no escape while they remain shackled to their dysfunctional currency.

Multinational companies don't make investment decisions in a vacuum. If companies reduce or stop investing in jobs in the UK because it is no longer as attractive because it is no longer a member of the European Union, what then? There were warnings that companies like Rolls Royce, Bombardier and Toyota may choose to leave the UK in the wake of Brexit. You will say that the UK government should offer incentives to make companies invest here - that may end up as being a race to the bottom in terms of workers' rights and benefits.

[John McKenna]

If, for the sake of argument, the UK economy does start to contract and keeps contracting

That could happen, but if it does it will be our fault, nobody else's. Our economy has never depended upon Europe and doesn't now, except insofar as the EU's protectionist policies make it harder for us to trade with the rest of the world.

Meanwhile, Europe's economies really are in a death spiral, from which there is no escape while they remain shackled to their dysfunctional currency.

The euro has had an increasing potential to dysfunctionality as the Eurozone went expanding south.

Let's not forget though that it took a massive Anglo-Saxon rigged crash to reveal the structural weaknesses in the Eurozone.

Anglo-Saxon financial scavengers then took the Eurozone to the cleaners for as much as they could wring out.

The Great Crash of 1929 was also an Anglo-Saxon creation. The US colossus is strong enough to ride out the storms it generates. Other countries suffer more than the US because they are all weaker and poorer.

Since the end of WW I all countries have been hostages to American fortune, and will continue to be so in the foreseeable future.

As I have said before - the UK (& Ireland, now, perhaps) would be better off applying to become the "51st state".

https://simple.m.wikipedia.org/wiki/51st_state

(If that ever happens I will defect to the EU, of course.)

[Christopher Kreuzer]

Good article here (obviously a massive amount being written about this):

http://www.theguardian.com/politics/com ... estminster

"...a diffuse, scattershot popular anger had not yet decisively found a powerful enough outlet, but that the staging of a referendum and the cohering of the leave cause would deliver exactly that..."

[Angus French]

Good article here (obviously a massive amount being written about this):

http://www.theguardian.com/politics/com ... estminster

"...a diffuse, scattershot popular anger had not yet decisively found a powerful enough outlet, but that the staging of a referendum and the cohering of the leave cause would deliver exactly that..."

I thought Gary Younge's piece was also very good.

Opening para: "In the end those who placed their faith in the “experts” were always going to be disappointed. The pollsters were wrong; the currency traders were wrong; the pundits were confounded. People who did not feel they had been heard have not just spoken. Given a one-off chance to tell the world what they think of how they are governed they have screamed a piercing cry of alienation and desperation." Get that last sentence.

[Christopher Kreuzer]

Good article here (obviously a massive amount being written about this):

http://www.theguardian.com/politics/com ... estminster

"...a diffuse, scattershot popular anger had not yet decisively found a powerful enough outlet, but that the staging of a referendum and the cohering of the leave cause would deliver exactly that..."

I thought Gary Younge's piece was also very good.

Opening para: "In the end those who placed their faith in the “experts” were always going to be disappointed. The pollsters were wrong; the currency traders were wrong; the pundits were confounded. People who did not feel they had been heard have not just spoken. Given a one-off chance to tell the world what they think of how they are governed they have screamed a piercing cry of alienation and desperation." Get that last sentence.

I have that article already bookmarked on a list of many to read. Too many. I don't normally find myself reading this much about something like this, but I get a feeling there will be lots to read and for people to have their say about for many months and years to come. It feels like the debate is only just beginning, and that another vote at some point is needed (whether a general election, a Scottish referendum, or a parliamentary vote).

I would suggest that surveys and opinion polls might tell us how people are feeling, but we know how accurate those are. I read somewhere that the head of one of the polling companies threw a referendum night party and then slunk away when it became clear that far from confidence in pollsters recovering, the confidence will hit new lows. And then you have the tone of newspaper coverage. How can you have referendums in a country so driven by partisan newspaper reporting?

[NickFaulks]

And then you have the tone of newspaper coverage. How can you have referendums in a country so driven by partisan newspaper reporting?

No problem at all, provided that all partisan views do get represented. My complaint is against the BBC monopoly, which requires them to be "neutral" when we all know they're not.

As I think you said earlier, it's time for a new thread. I intend do this today.

[NickFaulks]

A final thought on this one. I always chuckle at the view "it's terrible that such vital matters should be decided by only 52%. It should be the 48% that I'm in".

[Christopher Kreuzer]

A final thought on this one. I always chuckle at the view "it's terrible that such vital matters should be decided by only 52%. It should be the 48% that I'm in".

True. No new thread yet?

[MartinCarpenter]

Its pretty terrible if its decided by anything as close as 52-48 either way. When its that close you really should be compromising. Say this time you'd go back to Europe, demand really quite considerable concessions and have a new one in 5-10 years.

Not how it was set up though, presumably partially because Cameron couldn't dream of losing if it was pitched as a a choice between two absolutes.