News Analysis and trade Ideas*

Castles In The Air With Fabulous Views

730-90 fxcaptain


As the UK prepares to vote on Thursday in an historic referendum which could have repercussions far from its own shores, a final “Great Debate” on the subject was televised last night.

The Leave campaign is attempting to appeal to what they see as key British values such as democracy, sovereignty (control of borders and an end to free migration from the EU to the UK), independence and hope. This, they hope, will be enough to bamboozle the public into supporting their cause when virtually all of the economic opinion says that a Brexit will harm the UK and would cost jobs, inward investment and an inevitable loss of influence (even if only within the EU decision making process).

They are utterly unable to provide a realistic vision of life for the UK after it has stepped aside from the world’s largest and most successful trading bloc. In principle, they are opting for no formal agreement between the EU and UK that would assure the UK’s continued access to the single market (joining the EU free trade area would require the UK to continue to pay into the EU and accept its rules, free migration, but have no say in decision making). They do not explain policy on immigration after Brexit (more than half of immigrants to the UK come from outside of the EU); they don’t explain how being isolated from our partners will make us more democratic or sovereign; they fail to understand that the UK is not a Schengen nation and as such already has control of its borders and to have conveniently forgotten that we are an island nation!

How are the other countries feeling?

The former mayor of London, Boris Johnson, is claiming that the Germans (and presumably the rest of the EU) would be “insane” to impose tariffs on the UK insisting it would hurt their interests. However, this is assuredly what would happen. It may well be that EU rules would force tariff setting against a trading partner from outside the EU and with no special agreements in hand, but the political reality is that were the UK allowed to carry on as normal outside the EU and enjoy essentially the same position post-Brexit that it does now whilst being able to refuse to allow free travel and work to other EU citizens (whilst presumably allowing Brits to live and work where they like…) and not contribute to EU coffers, there would be a groundswell of popular demand across the EU for similar deals which would lead to its destruction. The EU – well, Germany, Italy, France, Belgium and the Netherlands at any rate – will not sit back and let this happen. The UK would be made an example of. Anybody with a decent memory will recall that Greece was forced to toe the line over austerity, despite a popular mandate, when the Eurozone made it abundantly clear that it would not be allowed to jeopardise the single currency. It was given a stark choice between doing what was demanded of it or being ejected from the Eurozone and, quite possibly, the EU itself.

Britain has sometimes been inward-looking, but if Leave campaigners believe it will be business as usual if we wake on Friday to find that their side has prevailed, they (and the nation) will be in for a very unpleasant surprise called real politics – 27 other nations will put their interests first and the very existence of the cherished “European dream” will be at stake. If Bobo doesn’t understand this then he is a fool; if he does understand the political reality, what does it say of his judgment and motivation?

News Source:


About the author

Forex News

Add Comment

Click here to post a comment

Your email address will not be published. Required fields are marked *

730-90 forex profita