Economy watch

wanderlust wrote:

xmiles wrote:

Sluffy wrote:

I read something from the PR person for the Remain campaign (very interesting reading it was too) and at an early point in the campaign they had a brainstorming session and one of the questions they asked themselves was 'What benefits would the general public say they have from being in the EU' - they couldn't come up with a single one!

Their campaign could only come up with benefits to business and that why it was almost totally centred around the economic issues of leaving the EU.

They could not get the public to identify benefits to themselves.

They knew that migration was a major issue to the electorate and they gambled the house that people would rather be better off financially and have migration issues, than be worse off and face the migration issues.

They lost.

Rather than blaming the electorate the question should in my opinion be why even have a referendum in the first place as the only reason it was given was a Conservative internal party struggle to control their EU rebels.

They too gambled on silencing once and for all their Euro-sceptics.

They also lost - and in doing so put us all in this totally unnecessary position.

Great work lads!

I would be interested in learning the source for the idea that "what benefits would the general public say they have from being in the EU - they couldn't come up with a single one!". I find this hard to believe. I know the Tories relied on Project Fear (it worked on the Scots) and Corbyn effectively sabotaged the Labour side but Sturgeon did empasise the positive benefits of EU membership. There is plenty of evidence out there as a simple internet search will reveal but one of the obvious ones is the level of subsidy received in the poorer areas of the country. Bizarrely the leave vote was strongest in the regions most economically dependent on the EU.
https://www.google.co.uk/url?sa=t&rct=j&q=&esrc=s&source=web&cd=7&cad=rja&uact=8&ved=0ahUKEwj3p9vE9q7OAhViL8AKHRV0DhcQFghDMAY&url=http%3A%2F%2Fmetro.co.uk%2F2016%2F06%2F25%2Fregions-with-the-biggest-leave-votes-are-most-economically-dependent-on-the-eu-5966531%2F&usg=AFQjCNFbdjIL50zM7R6xs68xBg11UnhxrA&sig2=yar_OxcMVXUX7rQBpBT4nQ

Note how high Lancashire is on this list. Dream on if you think a Tory government is going to match those grants.

It was absolutely criminal that the Remain campaign didn't build their campaign around the benefits of European membership - which aren't about grants - that's just getting back money we pay in anyway.
The big benefits are:

• Confidence - and therefore increased value - in the British economy whilst we are part of a European bloc that is far better equipped to fight off the rising challenge of the big two economies.
  
• Political stability in the European region in the nuclear age
  
• Voting rights including the veto over any country - including Turkey - from joining
  
• Scientific, medical and judicial joint ventures 
  
• Military support and the future option to create a European army that would reduce the cost to Britain and risk to British soldiers substantially
  
• A seat at the table to ensure Britain's interests are maintained in cross border issues such as immigration.
  
• Pre-negotiated advantageous trade deals with zero tariffs, substantially reduced "red tape" for British companies (who will now have to negotiate 27 deals and produce 27 sets of documentation)
  

There are other benefits but more importantly being in the EU had the potential to shape the future of our neighbours as well as the UK itself.

Sadly, none of that matters now and we'll just have to see what we can salvage.

Well said Wanderlust.

Also from a personal/work level - the work/time directive meaning a maximum of 48 hours a week - actually created jobs for more people rather than relying on overtime which doesn't actually make a difference to efficiency - also helps maintain a more balance between work and outside life

Being able to claim compensation when flights are delayed or cancelled

European Arrest Warrant which has been used against someone I know - and glad it was used

Roaming charges to disappear

No duty free and no limit on what I can buy and bring over from other EU countries

Being able to move, work and buy houses without the added red tape and getting the same rights as locals in that country without having to become a citizen.

bwfc71 wrote: Being able to claim compensation when flights are delayed or cancelled

You'll still be able to do that.

bwfc71 wrote:European Arrest Warrant which has been used against someone I know - and glad it was used

It's a European Arrest Warrant, not an EU Arrest Warrant. Leaving the EU will make no difference.

bwfc71 wrote:Roaming charges to disappear

It'll just be replaced by something else like when you go to the US or Australia.

bwfc71 wrote:No duty free and no limit on what I can buy and bring over from other EU countries

Who gives a shite. Only chavs buy booze at the airport.

bwfc71 wrote:Being able to move, work and buy houses without the added red tape and getting the same rights as locals in that country without having to become a citizen.

I don't intent to live abroad, just like 99.9% of the population.

xmiles wrote:

Sluffy wrote:

I read something from the PR person for the Remain campaign (very interesting reading it was too) and at an early point in the campaign they had a brainstorming session and one of the questions they asked themselves was 'What benefits would the general public say they have from being in the EU' - they couldn't come up with a single one!

Their campaign could only come up with benefits to business and that why it was almost totally centred around the economic issues of leaving the EU.

They could not get the public to identify benefits to themselves.

They knew that migration was a major issue to the electorate and they gambled the house that people would rather be better off financially and have migration issues, than be worse off and face the migration issues.

They lost.

Rather than blaming the electorate the question should in my opinion be why even have a referendum in the first place as the only reason it was given was a Conservative internal party struggle to control their EU rebels.

They too gambled on silencing once and for all their Euro-sceptics.

They also lost - and in doing so put us all in this totally unnecessary position.

Great work lads!

I would be interested in learning the source for the idea that "what benefits would the general public say they have from being in the EU - they couldn't come up with a single one!". I find this hard to believe. I know the Tories relied on Project Fear (it worked on the Scots) and Corbyn effectively sabotaged the Labour side but Sturgeon did empasise the positive benefits of EU membership. There is plenty of evidence out there as a simple internet search will reveal but one of the obvious ones is the level of subsidy received in the poorer areas of the country.

Sorry, I hadn't ignored your question, I've just not had time to find the quote.

It comes from Lucy Thomas, Deputy Director, Britain Stronger in Europe.

I must have remembered it from a video interview rather than reading it - but here it is below.

The video is excellent viewing in my opinion (it is 10 minutes long) and the quote comes at about 1minute 10 secs.

http://www.bbc.co.uk/news/uk-politics-36877788

Thanks Sluffy.

Very interesting viewing and it shows quite clearly how inept the Remain campaign was - starting with those idiots running it not being able to think of a single positive benefit of being in the EU. Not that Corbyn exactly helped.

xmiles wrote:Thanks Sluffy.

Very interesting viewing and it shows quite clearly how inept the Remain campaign was - starting with those idiots running it not being able to think of a single positive benefit of being in the EU. Not that Corbyn exactly helped.

The bottom line was that the politicians simply did not understand (or perhaps care) about their market - the electorate.

The elephant in the room (immigration) which mattered to the a vast majority of the electorate - particularly the older voters (being the ones most likely to vote anyway) was simply not addressed - how could it be, it was a major plank in being in the EU.

I'm not very political myself but I work closely with local political activists on a fairly frequent basis whilst working in the community. I was somewhat amazed of their cast iron certainty that the vote in the area I work in would be a Remain one, it seem quite blatantly obvious to me that even first generation ethnic familys who came to the country in recent years themselves (many of them not even being born here) had found job opportunities and public services (health, housing, education, transport, crime, etc) swamped and over stretched by current increasing immigration, to the detriment of the people already here.

It seemed fairly clear to me which way the vote would turn out in this particular electoral area and I was proved right.

There was no need for the referendum - the Conservatives only held it because of internal in fighting.

Clearly even Johnson thought it was about political manoeuvring - being the leader of the Brexit's he would be given a top job in a reconciled Tory (Remain) cabinet, with a power base with Eurosceptics within the party and a popularist choice of the general election voters, he would clearly be in a position of power to take over from Cameron at the end of his term and be in the perfect position to bring both parts of the Conservative party together.

The only problem was the he didn't understand the market he was casting for votes in and was shocked to find that not only had he won but will probably never be forgiven by his party or become a future PM.

Latest ONS report on manufacturing output shows that manufacturing output hit a 22 year high in Q2 in the build up to the referendum i.e. April so that was definitely a benefit of being in the EU. However in May and June, decline set in with growth falling to a twentieth of what it had been in April.
Despite this a separate ONS report showed that the trade deficit in June rose to £5.1 billion for the month (that's how much more we imported than we exported in one month if you didn't know) from £4.2 billion in May which is an increase in dependency on imported goods of about 21% post-referendum.  Obviously Britain has been a net importer for donkey's years which makes you wonder why anyone ever believed that exports would offset the Brexit hit however bad the exchange rate got, but that massive rise in the trade deficit shows that as British industry continues to contract and as new investment disappears it's obvious that exports will be even less able to save us despite the BoE introducing the lowest interest rate of all time and taking other quantitive easing measures to try to kickstart manufacturing back into life. Brexit has therefore created the quadruple whammy impact on the economy (fall in British output, fall in investment in British business, increase in foreign imports - all of which undermines Britain's negotiation strength in trade negotiations) - a vicious circle that even the most ardent Remain campaigners didn't fully expect. 
Hopefully Hammond can borrow even more from the world bank to arrest the slide via his budget before we have nothing left to negotiate with, but for now British (or foreign) investors are not backing British industry as (altogether now!) - it's all about confidence.

Pound falls below $1.30 and €1.70 - possibly as a result of the British manufacturing figures and continued downward trend.

I personally don't think we are heading into full on recession, but today William Hill's - who this morning fought off a takeover bid from 888 and Rank Group  - came up with this:


Bookmaker William Hill says it believes a UK recession before the end of 2017 is an odds-on shot and it's offering 8/11 - a 57% chance - that it will happen, but even money that it will not.

 'We believe there is slightly more chance than not that the UK will experience another recession before the end of 2017' says William Hill's spokesman Graham Sharpe (source: BBC news website)




On a more positive note, retail sales have improved pretty much in line with the good weather so whilst most Brits are concerned about their future spending power, we splashed on barbecue stuff, pubs and restaurants in July contributing to an overall rise of 1.7% on last July.

Going to see the bank on Saturday as I'm thinking about moving house, after all since I contributed to our possible exit from the EU I feel duty bound.

Slightly off topic but this is the only Brexit thread still active. Interesting analysis of the favourite brands of the two sides in the debate. Can't say I am surprised at what it shows though.

http://www.bbc.co.uk/news/blogs-trending-36970535

I can't see Crayola on that list.

A mistake, surely?

Iceland, wow.

Breadman wrote:I can't see Crayola on that list.

A mistake, surely?

Bitter.

NickFazer wrote:Going to see the bank on Saturday as I'm thinking about moving house, after all since I contributed to our possible exit from the EU I feel duty bound.

Emigrating to the South of France Nick?  Wouldn't blame you as they have a better standard of living, better weather and since the referendum they are now the fifth largest economy in the world so they should offer financial stability.

You shouldn't have a problem with the bank as the strategy is to encourage more borrowing to prop up the economy - a bit like the subprime lending that caused the 2009 crash only this time they are doing it deliberately because of the situation we are in. Now that we, the taxpayer own 75% of RBS I'd avoid them as they - or rather we - are talking about introducing negative interest on deposits and mega interest on loans and mortgages so watch them. Or rather us.

Not a good time to sell a house ATM though.

wanderlust wrote:
Not a good time to sell a house ATM though.

Utter bollocks. The market is still very strong.

Natasha Whittam wrote:

wanderlust wrote:
Not a good time to sell a house ATM though.

Utter bollocks. The market is still very strong.

The number of exchanges is up (6.5%) but only because prices are tumbling and buyers and agents are using the uncertainty of Brexit to force deals through.

Nationally, prices down 0.9% last month but the big hit is in the £500k plus bracket market sector (nationally) and especially London where prices are dropping by over £1000 a day. 

We've reluctantly knocked £35k off our asking price but it's obvious already that we'll have to knock a damn sight more off if we're going to shift it and the agent never tires of asking for further reductions "because of Brexit".

So it's a good time to give away rather than sell a house as everyone who has a mortgage continues to hurtle towards negative equity.

The good news is that monthly mortgage repayments will be less.
The bad news is that when the mortgage is finally paid off, what you've bought will be worth f*** all.

wanderlust wrote:
We've reluctantly knocked £35k off our asking price but it's obvious already that we'll have to knock a damn sight more off if we're going to shift it and the agent never tires of asking for further reductions "because of Brexit".

So it's a good time to give away rather than sell a house as everyone who has a mortgage continues to hurtle towards negative equity.

The good news is that monthly mortgage repayments will be less.
The bad news is that when the mortgage is finally paid off, what you've bought will be worth f*** all.

You are the worst for making stuff up to scare people. There is a housing shortage in the UK, a house will always be a good investment.

Houses round here are selling as soon as they go up for sale. The only houses stuck on the market are those that are either grossly overpriced or are so bad inside even a developer wouldn't touch it.

When was the last time the armchair was cleaned?

Nats right. There will always be a market for housing, simply because there are so many people and a shrinking housing stock. The decision, if it can be made, is whether to buy, buy to rent, or rent.

My mortgage is paid off, and I wouldn't say that I've ended up with nothing. Apart from the security of knowing its my house, and nobody can take it off me, I'm not paying either rent or mortgage payments, and if push comes to shove, I can either downsize (again), or take the equity out of the house. You can't do that with a rented property.

wanderlust wrote:Emigrating to the South of France Nick?  Wouldn't blame you as they have a better standard of living, better weather and since the referendum they are now the fifth largest economy in the world so they should offer financial stability.

Till the right wing get in at the general election next year and go to referendum on Frexit and leave, then move on to Germany till they see sense. 

If you shop around though there are some excellent property deals around in France

 Hehehe.

Nat/Glos: I agree that the old adage about bricks and mortar being a sound investment will always come good, but you must know that the relative value fluctuates in response to Government policy and the economy and remember that there are occasional "adjustments" of that relative value.
It was only a few years back that over 20% was wiped off the value of houses overnight and that put millions of people into negative equity - effectively tying them down until the market recovered (8 years later) or they could take the loss if they were desperate to move on.

I also agree that house prices will recover to what they were but the key is when? It's like the whole Brexit argument: the nature of capitalism is that it has to keep growing to survive so on that basis it will come back eventually - but in the meantime will have lost ground to other economies which changes the relative position to them - and in the case of Brexit, that affects our negotiating power for trade deals. In the case of home owners it affects the cost of mobility.

It raises two questions: 1) if we are going to take a hit on the value of our assets and our money, what have we gained to offset the loss? 2) when the prices do recover, will the pound also have recovered relative to other economies - because if it hasn't our housing stock may get increasingly snapped up by foreigners looking for a second home - just as Brits bought abroad when the Spanish/Portuguese/Bulgarian etc economies were relatively poor. The superrich Arabs and Russians have already bought central London and if we reduce both the price of housing and the pound's value, the foreign middle class may start to get in on the act and put even more pressure on the regional housing stock. 

There is also an increase in the ratio of rental to ownership in the UK which is further reducing demand (or may be a function of inflated prices)

Key Points of the 2011 census:

•  In 1918 the majority, or 77%, of households in England and Wales rented, with the remaining in ownership.
  
  
• From 1953 ownership started to increase at a faster rate than in previous decades and by 1971 there was an equal percentage of households owning and renting. 
  
  
• Ownership continued to increase, reaching a peak of 69% in 2001, however in the last decade it has fallen to 64%. 
  
  
• Within the rental sector policies following the World Wars impacted on the percentage of those socially renting. In 1918 just 1% of households socially rented and this reached a peak of 31% in 1981. 
  
  
• Between 2001 and 2011, the number of households buying their homes through a mortgage fell by 749,000. Some factors that might have impacted on mortgage buyers are: high house prices, low wage growth and tighter lending requirements. 
  
  
• The percentage of households renting increased in all English regions and in Wales in the decade to 2011. 
  
  
  So it looks like the swing is away from buying and towards renting as it is in most of Europe. 
  
  What I'm saying is that right now is not a great time to be selling. Personally I'm thinking of letting out the house on a company let perhaps to an Airline at Norwich Airport so they can use it for pilots and cabin crew stopovers - and moving me and the missus into my bungalow.
  Just have to convince the missus.