So Brexit now needs parliamentary approval?

[Ken]

Britain a "beacon for free trade" sounds like an impressive rallying cry but, like pure socialism, free trade is really just a utopian dream. Every country wants to benefit from a trade deal so every deal requires huge give and take. That is why they take years to negotiate and ratify.

 

Under a Trump Presidency free trade will be massively unwound as the US actions will create knock-on effects and this could even usher in a new era of rampant protectionism across the world.

 

Against this backdrop pinning all hopes on free trade seems very optimistic. However I think the UK is in a corner with this and will have to leave the customs union and take the risk.

 

Given that life in the EU was so unbearable in Britain it is worth rolling the dice.......no?

 

Actually they could just pass a law to make free trade compulsory with "equal and opposite" penalties for breach of the law funding compensation payments to UK businesses. If say British car exporters were being taxed 16% on their exports to the EU then EU car exporters would be fined 16% on their UK imports and the UK businesses refunded from the fines. Of course you'd need intelligent judges to make the system work - so no hope there then.

[Gbye grey sky]

Actually they could just pass a law to make free trade compulsory with "equal and opposite" penalties for breach of the law funding compensation payments to UK businesses. If say British car exporters were being taxed 16% on their exports to the EU then EU car exporters would be fined 16% on their UK imports and the UK businesses refunded from the fines. Of course you'd need intelligent judges to make the system work - so no hope there then.

 

I am fairly sure that under WTO rules any tariffs imposed have to be applied on imports from anywhere. Thus if the EU currently imposes a tariff on all imports (not just on the UK), then any retaliatory tariff by the UK would also have to apply to non-EU imports. Then all hopes of free trade deals are gone.

 

Simply calling it a "fine" rather than a "tariff" will not circumvent this.

[newjez]

http://www.telegraph.co.uk/news/2017/01/03/british-ambassador-eu-sir-ivan-rogers-unexpectedly-quits-just/

 

I hear Nigel farage is still looking for a job in between taking pot shots at widowers, or possibility Michael Gove?

[BacktoDemocracy]

Modern economics believes international trade operates under the gravity model, namely the amount of trade between two countries is proportional to the size of their markets and distance. It holds up well under empirical scrutiny.

 

The other observation is that borders slow trade due to non-tariff barriers. There are two main issues: Customs checks slow down the transport of goods, and technical standards ensure that a widget manufactured in Burnley is interchangeable with one from Bavaria, without having to undergo independent tests. In combination, these make it easier to sell between EU countries.

 

In fact, an awful lot of the red tape from Brussels is there to enact standards that all EU members adhere to.

 

Paul Nightingale, who got into a Twitter spat with Douglas Carswell over the Sun, Moon and tides, wrote a piece explaining all this in simple terms.

 

So being outside of the Single Market, even with tariff free access, is going to cause an impediment to trade with Europe. Being a rich market of 440 million people, that's going to hurt the balance of payments.

 

A free trade deal with China or India isn't going to offset this. They might be bigger markets, but the distance from the UK will reduce the amount of benefit that.

 

And that's assuming it's not completely one sided. The agreement between the Chinese and Swiss gives the former immediate tariff free access, whilst the latter has to wait fifteen years!

 

Lastly, I want to make a point about Change Britain's figures. They have a projected benefit of £24 billion in event of a Clean Brexit. The UK's GDP is just under £2 trillion, making it worth about a 1% advantage. I find a lot of politicians to use big numbers as a kind of rhetoric, but they fail to put them in context.

 

Fantastic, some one with clarity, sick and tired of being told trade with China and India will make up for trade with one of the richest continents in the world, complete b*ll sh*t from people still living in the colonial era.

[BacktoDemocracy]

I am fairly sure that under WTO rules any tariffs imposed have to be applied on imports from anywhere. Thus if the EU currently imposes a tariff on all imports (not just on the UK), then any retaliatory tariff by the UK would also have to apply to non-EU imports. Then all hopes of free trade deals are gone.

 

Simply calling it a "fine" rather than a "tariff" will not circumvent this.

I always find your clarity of thought a refreshing ray of sunshine.

[amibovered]

[h=1]Bank of England admits 'Michael Fish' moment with dire Brexit predictions[/h]

 

http://www.telegraph.co.uk/news/2017/01/05/bank-england-admits-michael-fish-moment-dire-brexit-predictions/

[amibovered]

[h=1]Sturgeon offers to shelve independence vote in return for soft Brexit[/h]

https://www.theguardian.com/politics/2017/jan/06/nicola-sturgeon-offers-shelve-independence-vote-for-soft-brexit-eu

 

Hmm, OK, so hard Brexit, Scottish independence, Scotland joins EU and has tariff free trade for the 11 or so billion quids worth of trade with the EU, but what about the 48 billions or so it trades with the rest of the UK, that's going to end up with a tariff on it, yep great plan Nicola.

[VERYSTORMY]

Fantastic, some one with clarity, sick and tired of being told trade with China and India will make up for trade with one of the richest continents in the world, complete b*ll sh*t from people still living in the colonial era.

 

Except look up the Cambridge report, published this week by the most eminent group of economists in the UK which first states:

 

1 The gravity model is crap.

2 Project fear was nothing more than progoganda

3 That wages will rise post Brexit

4 The treasury were biased

5 It will have a positive effect on housing shortages

6 Membership of the single market has provided no net benefit to the UK trade

7 That there will be at worst no negative. In there words "grey" meaning as normal.

 

But hey, given every piece of data has proved all the fear mongers were wrong from the PMI for service sector to the BoE admitting it very publicly believe what you wish.

[newjez]

https://www.theguardian.com/politics/2017/jan/06/nicola-sturgeon-offers-shelve-independence-vote-for-soft-brexit-eu

 

Hmm, OK, so hard Brexit, Scottish independence, Scotland joins EU and has tariff free trade for the 11 or so billion quids worth of trade with the EU, but what about the 48 billions or so it trades with the rest of the UK, that's going to end up with a tariff on it, yep great plan Nicola.

doesn't the UK govt still own Scotland's biggest company? Not sure how that would pan out. But I do think the wee fish is just maneuvering.

[newjez]

Except look up the Cambridge report, published this week by the most eminent group of economists in the UK which first states:

 

1 The gravity model is crap.

2 Project fear was nothing more than progoganda

3 That wages will rise post Brexit

4 The treasury were biased

5 It will have a positive effect on housing shortages

6 Membership of the single market has provided no net benefit to the UK trade

7 That there will be at worst no negative. In there words "grey" meaning as normal.

 

But hey, given every piece of data has proved all the fear mongers were wrong from the PMI for service sector to the BoE admitting it very publicly believe what you wish.

hopefully the pound will pop back up shortly. Actually, hopefully not. All my money is in USD ATM.

[Parley]

Dow Jones about to burst through 20,000.

 

The world is looking positive at the moment.

[Perthbum]

Dow Jones about to burst through 20,000.

 

The world is looking positive at the moment.

europe aint

[newjez]

Dow Jones about to burst through 20,000.

 

The world is looking positive at the moment.

happy days! USD doing well too. Win win.

[newjez]

 

europe aint

probably not the best place to put your money ATM, or China or Australia or the UK. It's Trump Trump Trump, USA all the way. Next rate rise, caching!

[Perthbum]

 

probably not the best place to put your money ATM, or China or Australia or the UK. It's Trump Trump Trump, USA all the way. Next rate rise, caching!

UK share prices are boomimg

[newjez]

 

UK share prices are boomimg

but the pound isn't. You get the share gain and the exchange gain by investing in USA markets. This will only get worse over the next quarter.

[newjez]

By

Except look up the Cambridge report, published this week by the most eminent group of economists in the UK which first states:

 

1 The gravity model is crap.

2 Project fear was nothing more than progoganda

3 That wages will rise post Brexit

4 The treasury were biased

5 It will have a positive effect on housing shortages

6 Membership of the single market has provided no net benefit to the UK trade

7 That there will be at worst no negative. In there words "grey" meaning as normal.

 

But hey, given every piece of data has proved all the fear mongers were wrong from the PMI for service sector to the BoE admitting it very publicly believe what you wish.

they seem to be making a huge assumption that they don't make a dog's breakfast of it. Recent events will cast doubt on that. In fact, at the moment I doubt they'll be able to organise the catering for the leaving party.

 

 

However, the Centre for Business Research advises that its own conclusions should be taken with a pinch of salt. The report states: "The best we can do is to construct a series of scenarios based on assumptions about future trading arrangements, migration controls and about the short-term uncertainties which could affect business investment in the run-up to the likely leaving date of 2019."

The working paper, for example, assumes that Theresa May prioritises immigration controls and manages to reduce net migration to around 165,000 from 2020. It also assumes an eventual free trade deal with the EU and a transition arrangement while it is negotiated. While these assumptions are likely, they are by no means certain.

The academics also caution that their conclusions do not amount to a rosy economic outlook for Britain. Real wages, for example, are forecast to be only slightly higher in 2025 than they were in 2004 due to the return of inflation and sluggish wage growth.

 

 

http://uk.businessinsider.com/brexit-university-of-cambridge-treasury-forecasts-little-basis-in-reality-project-fear-2017-1

[Gbye grey sky]

One of the unfortunate consequences of the Brexit vote is that the UK Government, senior Civil Service, legislature and judiciary will be devoting most of their time and energy for the next decade on managing the fallout from Brexit. A country coming out of recession with low unemployment simply trying to ensure that everything doesn't collapse.

 

If they achieve this then I assume come 2025 those who supported Brexit will herald it a success if inflation and unemployment did not rise and the UK did not actually fall back into recession. I guess that the only true measure of success would be falling net migration figures.

[Ken]

One of the unfortunate consequences of the Brexit vote is that the UK Government, senior Civil Service, legislature and judiciary will be devoting most of their time and energy for the next decade on managing the fallout from Brexit. A country coming out of recession with low unemployment simply trying to ensure that everything doesn't collapse.

 

If they achieve this then I assume come 2025 those who supported Brexit will herald it a success if inflation and unemployment did not rise and the UK did not actually fall back into recession. I guess that the only true measure of success would be falling net migration figures.

 

But a falling net migration figure can be achieved by more people emigrating. Is an economy that more people want to leave really a measure of success?

[Gbye grey sky]

But a falling net migration figure can be achieved by more people emigrating. Is an economy that more people want to leave really a measure of success?

 

Does it matter either way. The main object of the exercise is to reduce net migration........isn't it? May has certainly made that clear.

 

But, seriously, many of those emigrating are going be returning immigrants as their earnings in sterling are worth less when they send it back to their families at home and they may even fare better in their country of origin.

[newjez]

Does it matter either way. The main object of the exercise is to reduce net migration........isn't it? May has certainly made that clear.

 

But, seriously, many of those emigrating are going be returning immigrants as their earnings in sterling are worth less when they send it back to their families at home and they may even fare better in their country of origin.

good to see some house price deflation. Haven't seen that since, oh, the GFC. That worked well didn't it? I really don't know where they got their figures from. They are going to totally stop EU immigration, and non EU migration won't be affected, even as a result of trade agreements? Just sounds like wacky lar lar land to me. True, the treasury was overly pessimistic. These guys seem the opposite. Interested to know who funded the report.

[Gbye grey sky]

good to see some house price deflation. Haven't seen that since, oh, the GFC. That worked well didn't it? I really don't know where they got their figures from. They are going to totally stop EU immigration, and non EU migration won't be affected, even as a result of trade agreements? Just sounds like wacky lar lar land to me. True, the treasury was overly pessimistic. These guys seem the opposite. Interested to know who funded the report.

 

I am struggling to understand how they conclude that the original forecasts were pessimistic. Everyone assumed that a vote to Leave would trigger an almost immediate filing of Article 50 and that Brexit would be a hard Brexit (which still seems fairly certain). If that had happened we would have been in a wholly different scenario to the one we now have with this 9 month hiatus where the UK can reap the short term benefits of a currency devalued by 20% against all major currencies whilst still benefiting fully from access to the European single market.

 

Against that backdrop plus an almost inevitable 2 year Brexit window to March 2019 plenty of scope for short term profits. Yes, there is a lot of uncertainty, but while that can has been kicked down the road the good times can roll on a little longer.

[Parley]

Isn't Article 50 being done by end of March ?

[Gbye grey sky]

Isn't Article 50 being done by end of March ?

 

Yes, which kicks off a 2 year window while negotiations take place.

[newjez]

I am struggling to understand how they conclude that the original forecasts were pessimistic. Everyone assumed that a vote to Leave would trigger an almost immediate filing of Article 50 and that Brexit would be a hard Brexit (which still seems fairly certain). If that had happened we would have been in a wholly different scenario to the one we now have with this 9 month hiatus where the UK can reap the short term benefits of a currency devalued by 20% against all major currencies whilst still benefiting fully from access to the European single market.

 

Against that backdrop plus an almost inevitable 2 year Brexit window to March 2019 plenty of scope for short term profits. Yes, there is a lot of uncertainty, but while that can has been kicked down the road the good times can roll on a little longer.

Well, the press release was sexed up. There is language in the press release not in the report. Plus you are correct, they seem to be aiming at a soft brexit. Their inflation estimate is actually higher than the treasury. Their unemployment slightly lower, as they are expecting a huge drop off in immigration. But I think the major difference is the treasury report assumed the damage would go on for years. This report expects the gains to start kicking in and reducing the damage, even providing a benefit. But they are assuming some sort of transition will be enabled. Plus, they have put a warning out on their figures. This is probably where the treasury went wrong. They should have provided a range of outcomes as the process is unknown. This is just an outcome in that range. But the treasury had an agenda. They were trying to scare us into staying, and people saw through that. Whether these guys have an agenda or not is yet to be seen. Thing they are touting for business?