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Old 05.12.2016, 15:37
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Re: The Brexit referendum thread: potential consequences for GB, EU and the Brits in

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Tarifs will effect the EU more than the UK, with over 10% fall in the a 10% tariff of sales is irrelevant & will cost exporters ZERO. Being that you can't increase the price of a commodity item by 25% most of the tariff & currency loss will have to be paid for by the foreign company selling to the UK.

It's really very easy if you understand how the market works.

The lower priced has been very profitable for exporters to date, it's a win win situation regardless.

Free movement is fairly useless to 90% of the UK population as they only speak English, being many Europeans speak almost fluent English. I moved to CH before free movement, if you had some special skill you could move.
...except inflation will negate the falling pound within about 18 months. Devaluations away from the fundimentals of an economy have a benefit lifetime of maybe 12 to 18 months. Or do you think the Tories are serious in wanting UK workers to be like the Chinese and include being paid like the Chinese in that desire?

The falling pound of course anyway only impacts UK value added. Given the country has very limited resources a high proportion of the cost of production will be directly impacted by increased cost of raw materials and to a high degree components. These costs will have to be borne by UK producers. And you can increase the price of a commodity item by 25% if weveryone else is doing the same - which will be the case in the UK.

UK economic fundimentals are actually weak. The country can't feed itself and industrial production has been at a comparatively low level since Thatchers days. The balance of payments is very negative and the whole country is kept afloat by the financial services sector (plus the creative sectors to a smaller extent) - which would be badly hit by the loss of the financial passport and will be able to very rapidly decamp to Berlin, Paris, Amsterdam or wherever if necessary. You don't think the EU are aware of this?

Oh and most economic commentators believe the pound was overvalued prior to the Brexit vote and is now at its correct level. Will be interesting where it goes when Brexit happens.
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