≡ Menu

Weekend reading: Look who’s back

Weekend reading: Look who’s back post image

Good reads from around the Web.

Brexit started with a bang in June. The stock market plunged and a bloodbath unfolded at the top of the major political parties. We were all hooked.

But like a TV drama with a limited budget, things tailed off as we got bogged down in turgid mid-season plot building.

Theresa May’s appointment was reassuring but hardly a thriller, as the crazy Andrea Leadsom story line went nowhere. The Bank of England did its best to liven things up by cutting interest rates and warning of a greater chance of a recession, but more positive data kept coming in.

Even I had to admit – not without some relief – that I’d been wrong about the initial impact of the Leave vote. I wondered aloud if commercial property in London was now a buy.

Many viewers began switching off.

But in the past week, Brexit got back to its barmy best.

Not so much like Game of Thrones as the early episodes, mind you. More The Man in the High Castle, as an alternative universe started to take shape around us.

The right kind of workforce

It all started when Prime Minister Theresa May announced that she would trigger Article 50 this coming March. That sent the pound falling.

Later, she made it clear that curbing immigration rather than preserving the economy was her top priority. Pandering to fear and prejudice – the fantasy and lies of the Leave campaign – was more important than trying to maintain the profits and tax revenues that might actually help address the very real inequalities that motivated a big chunk of the vote to Brexit, and that she identified in a conference speech that otherwise had much to commend it.

As a result of this posturing, a ‘hard Brexit’ now seems firmly on the table, to the dismay of business [search result]. The pound fell some more.

Then we had some sinister new plot twists. Talk from Jeremy Hunt that the UK should be “self-sufficient” in doctors set the tone, but worse were the almost unbelievable plans from Home Secretary Amber Rudd to force companies to publish the proportion of “international” staff on their books.

Rudd said she wanted to “flush out” companies that she deemed to be harbouring an inappropriate number of (entirely legal) foreign workers.

This would “nudge them into better behaviour”. (Better as defined by Amber Rudd and the new order in Britain.)

It didn’t take an LBC radio presenter to point out where we’ve heard this kind of language before. Still, James O’Brien did an excellent job of drawing the parallels.

Ukip won the war, but it’s losing the plot

Before some bold Brexiteer turns up in the comments to tell me to calm down, it does seem Rudd may row back on these plans.

But that is only because of the backlash from business and other commentators. Clearly they felt appropriate at the time her wonks drew them up.

Another sign of the times – we learned yesterday that foreign-born academics have apparently been barred from giving the government official advice on the upcoming Brexit negotiations:

It is understood up to nine LSE academics specialising in EU affairs have been briefing the Foreign Office on Brexit issues, but the school has received an email informing it that submissions from non-UK citizens would no longer be accepted.

Relevant departments subsequently sent notes to those in the group, telling them of the instruction.

One of the group is understood to be a dual national, with citizenship of both the UK and another EU member state.

The Foreign Office was said to be concerned about the risk of sensitive material being exposed as article 50 negotiations over Britain’s exit from the EU – and subsequent talks on its future trade and other relations with the bloc – start to get under way.

Because, you know, being born in a country is the best way to judge a person’s trustworthiness and loyalty!

It’s frightening how quickly we’ve got to a point where our vibrant economy that attracts talent from across the EU and the world has become in the language of politics a cartel of unpatriotic gangmasters, shiftily employing Johnny Foreigners who hop over the border to steal our wages as well as our benefits.

As Ian Dunt, the editor of Politics.co.uk puts it, the Conservative party is arguably morphing into Ukip and the direction is disturbing.

Take the government’s ongoing refusal to guarantee the right to remain for all EU citizens living in Britain. Dunt writes of the logical conclusion:

Mass deportations. It sounds alarmist doesn’t it?

No, it wouldn’t involve Nazi officers banging on doors. It would all be very polite and English. A very polite but firm Home Office letter would come through the letter box and it would have a deadline.

If you don’t make that deadline – or if the authorities say they have reason to believe you won’t – the immigration enforcement vans come.

The sudden exodus of three million people from the UK. That is the suggestion. That is the threat.

That is what is implicit in Fox’s card game. It might be the most shameful policy Britain has considered in living memory. It is so shameful no-one dares say it out loud. They only imply it. But that is what he is proposing. That is the reality.

This is the great and final victory of Ukip. They have taken their economically catastrophic EU agenda, their bizarre sense of thin-skinned personal victimhood, and their culture-war poison over immigration and embedded it in the guts of the Tory party.

Do I think it’s likely that millions of EU citizens will ultimately be asked to leave the UK?

No, not particularly. Not yet.

Am I ashamed and dismayed that we’ve come to this in three short months?

Absolutely.

Thankfully, there was also a comic thread running through the latest episodes to lighten things up. It also came from Ukip – the cast of characters who by giving voice to the common man (or more specifically voice to his or her bigotry and fearfulness, rather than his or her better nature) seeded the germ that’s now eating us up.

This week we saw the leader step down after 18 days at the helm and Nigel Farage come back from the political dead to resume his place as top dog. Then one of its MEPs was hospitalized after confrontations with another Ukip MEP in the European Parliament.

Yep, funny alright. Albeit like a Tarantino movie is funny.

Investment implications

The pound is around $1.24 as I type – down from $1.30 before the Conservative conference, and around $1.50 in the moments before the Leave win was confirmed.

Overnight the pound fell to $1.14 in a flash crash that was blamed on robots (there being no Romanians or Poles nearby to take the blame, presumably).

The precipitous fall in the pound is making our country and its citizens poorer. That’s true however much you personally are managing to offset the declines with your investments in a Vanguard global tracker fund, or however much you believe Blackpool and Skegness can beat anything a fancy pants foreign holiday has to offer.

The FT has a big piece on the winners and losers from the pound’s decline [search result]. So far foreign tourists are the biggest beneficiaries. Quelle ironie!

If the fall in the pound is followed by a decline in overseas investment and a widening of our current account deficit, then all bets really are off again. The least we can now expect is an inflation shock. We import far too much for sterling’s collapse not to show up in our grocery bills.

The iShares index-linked Gilt fund is 23% higher since Brexit day. That had seemed like a crazy move. Now it’s looking prescient.

It will also be interesting to see where Theresa May’s opinion that low interest rates may now be causing more problems than they’re worth fits into the picture.

Some onlookers say a political intervention to reverse low rates is being signaled. I think it’s more likely cover for a big fiscal push in the Autumn Statement.

Get with the programme

Investing aside, I hope the more reasonable end of the Brexit voting spectrum will be as dismayed as me that what was (wrongly) dismissed as a xenophobic fringe element during the EU Referendum campaign is alive and kicking in the mainstream body politic.

If I was that kind of reasonable Leave voter, then rather than downplaying every lurch to the right in the rhetoric, I would be speaking out against it.

Millions of people who came to the UK with the best of intentions – and who we welcomed in, employed, worked alongside, and enjoyed the company of for years – now find themselves the subject of a bogus political scrutiny.

Even if it all comes to nothing, damage has been done on a personal level, and perhaps soon enough on an economic one.

We need to avoid worse.

Making good use of the things that we find…

Passive investing

Active investing

Other articles

Product of the week: Santander will cut the interest paid on its 123 account in November, and now it has emerged that new customers will no longer be able to get its popular 123 cashback credit card, says ThisIsMoney. Instead they’ll be offered the All In One card, which pays 0.5% cashback and comes with a £3 monthly fee. If you like cashback you might instead consider the Platinum Cashback Card from American Express. It pays 1.25% cashback after a three-month 5% period. There’s a £25 annual fee.

Mainstream media money

Some links are Google search results – in PC/desktop view these enable you to click through to read the piece without being a paid subscriber of that site.1

Passive investing

  • Dilbert shares our pain – Dilbert
  • Indexing in less-efficient markets [US but relevant]Morningstar
  • Investors are turning to simple passive bond funds – Bloomberg
  • Here’s how much the ETF industry makes – ETF.com

Active investing

  • Questor is building a UK dividend income portfolio – Telegraph
  • Fisher: The joyless bull market has longer to run [Search result]FT
  • Bottom-feeding stock picker in Japan crushes the market – Bloomberg
  • Shiller’s market indicator is sending a false signal [Search result]WSJ
  • Hard Brexit could be a huge buying opportunity (for foreigners…) – MarketWatch

A word from a broker

Other stuff worth reading

  • Why low interest rates are probably here to stay – Bloomberg
  • Seven pieces of conventional money wisdom to question – MarketWatch
  • Born lucky? Children of the ’60s, ’70s, and ’80s on buying a home – Guardian
  • How your spending changes as you approach 100 – Telegraph
  • One firm created a town of accidental millionaires – Our State [via Mike]
  • Three steps to reinventing your career – Quartz
  • The economics of dining as a couple – Bloomberg
  • 91-year-old who dumped chemo for road-trip adventure dies – CBS

Book of the week: Brexit got you down? It could be worse. We could already be living in the The Age of Em. I listened to an interview with the author – futurologist Robin Hanson – in which he implied that it would be churlish for any humans surviving in his AI/robot dominated future to look on the amazing world of their super descendants with anything but pride – sighing wistfully before returning to scavenging about in the gaps for something to eat. Very Silicon Valley. But it’s an interesting read, and I’d at least take on board Hanson’s advice to make sure you are the owner of a few ems (crossbred Einstein-level geniuses on a chip) before the Age of Em dawns.

Like these links? Subscribe to get them every week!

  1. Note some articles can only be accessed through the search results if you’re using PC/desktop view (from mobile/tablet view they bring up the firewall/subscription page). To circumvent, switch your mobile browser to use the desktop view. On Chrome for Android: press the menu button followed by “Request Desktop Site”. []

Receive my articles for free in your inbox. Type your email and press submit:

Comments on this entry are closed.

  • 51 TT October 9, 2016, 9:23 am

    I don’t see any Bremoaning. What is potentially and probably one of the most significant changes to any western country in a generation deserves thought, challenge, and reflection by us all. Any suggestion that we treat it as “it’s done, let’s move on” totally misses the point that whatever side of the equation you are on, we are only just at the beginning of the process and it will be years before we realise the impact of our action.

    It’s true that this might end up being a Y2K moment but the the proponents on both sides feel this is a fundamental change to the way our country works. We can’t just stop talking about it. If you’re sick of the talk now, just wait until the real talks start.

  • 52 Neverland October 9, 2016, 9:46 am

    @MarrkT

    Usual Brexit lies from you

    Only 17.5m million people voted to leave the EU

    This is not 52% of the electorate

    UK has a population of c. 63m and an electorate of 47m (look it up on the Electoral Commision website, dummy)

    I’m quite happy to leave the EU via a hard exit if those 18m are willing to write a blank cheque to the other 45m of us for the cost

    But of course being older and poorer they expect the rest of us carry them on our backs

  • 53 green_as_grass October 9, 2016, 9:58 am

    The Investor:
    “The only thing that cheers me up about writing these miserable Brexit articles is that they might annoy the likes of you.”

    If this is true then you got the reaction you wanted from your post and are hardly in a position to complain about it, much less start telling people that their reaction is unwanted. You don’t deliberately poke a stick in a wasp nest and then whinge about being stung afterwards, especially if it’s the third or fourth time you’ve done it.

    Look, speaking as someone who has seen more than one website undergo a meltdown as the result of forum disagreements escalating into bitter civil war, I would advise caution about displaying too much bitterness and resentment towards the Leave camp when covering Brexit topics. Brexit is inevitably going to be a major theme on all UK economic/investment/money related websites like this one for the foreseeable future, so a wise course of action would be to assume that half your audience are Brexit supporters who do not wish to be told, directly or by insinuation, your own personal opinion of them. Not unless you want to be insulted back of course, which worryingly, from the above quote, appears to be your aim.

    You have a fabulous website here. I check it several times a week because I’m passionate about investing and all things relating to the journey towards financial independence, so please don’t screw it up. Take the bitterness or resentment or whatever it is that makes you want to poke the Leave supporting half of your audience and lay it to one side when you write about Brexit, otherwise you will eventually get sick of the insults you get back and stop writing. I have seen it happen before. The website is too good to be spoilt

  • 54 Lee October 9, 2016, 10:05 am

    Excellent summary of the situation, and some incisive comments.

    I’m paid in JPY and was buying more GBP denominated assets since June due to their cheapness. I was under the impression that some kind of sense would begin to prevail in the end. I still have some kind of hope that May et al were playing to the blue rinse brigade and won’t actually implement much of what they say.

    What has been done unfortunately is that the UK will be increasingly come to be seen as hostile and closed. They have signalled this, and people will have taken note. Their impressions of the UK will be changing forever, and May et al’s talk of trying to attract the “brightest and best” will come to naught. The “kindness of strangers” will also dissipate.

    Former colleagues working UK institutions from European countries have been rightly complaining about the things that have been said on Facebook – they have good PhDs and substantial knowledge that is difficult, nigh on impossible to replace from UK natives. It must be simply awful living and working in a country when you are bombarded with this kind of shit from the government. For the first time since the early 1990s I am ashamed to be British.

    I now see the flash crash of -6% as a premonition of things to come for GBP, and part of me wishes worse on the country for what is being said and done by its irresponsible politicians.

  • 55 Leib October 9, 2016, 10:09 am

    @green_as_grass

    ‘You don’t deliberately poke a stick in a wasp nest and then whinge about being stung afterwards’ – a pretty ugly comment and telling how low discourse is getting in this country.

    I’d like the investor to continue talking frankly. I think anyone who gets offended over the above article should be more offended with how the Conservatives are representing their vote than anything else, because it’s all just commenting on the reality of the situation.

  • 56 Dave P October 9, 2016, 11:30 am

    Monevator used to be an excellent financial website before it appeared to morph into a political blog. I had hoped that it would regain it’s mojo, but I guess not. Oh well, another one off the bookmarks list.

  • 57 The Investor October 9, 2016, 11:32 am

    @green_as_grass — Thanks for the generous words about the site (and same to the others above).

    I didn’t say it was the reason *why* I wrote these articles, and I didn’t say I wanted to get people turning up and writing glib angry comments about Brexit. I did say the thought provides a bit of succor when it comes in the aftermath.

    The reason I write such articles is because I think the political discussion in this country is changing fast, and potentially the economic climate is going to follow it — and already is, with respect to say the exchange rate — and in as much as my two pence on the subject is worth anything, my site would seem to be the place for me to share it.

  • 58 The Investor October 9, 2016, 11:33 am

    @Dave P — Bon voyage!

  • 59 Gordon October 9, 2016, 11:36 am

    Investment should be about cold rational decisions. It’s hard to trust the judgement of someone that lets emotion let him alienate half his audience.

    I worked in the Middle East. In Kuwait migrants could get deported for driving through a red light. Cut up the wrong person when driving and the police could deport you the next day. ME countries used to hire ferries and deport hundreds of migrants at a time back to the subcontinent.

    I worked with a Pakistani guy that had been born in the ME and had spent his whole life there. There is not a hope in hell that he would ever get a ME passport. It’s only the West that is happy dishing out passports like confetti. Places like the ME, Japan and Korea etc just don’t give migrants citizenship.

    imho we should be following the migration policies of places like Japan ie let in migrants with useful skills but don’t give them citizenship. For clarity I wouldn’t consider the selling the ‘Big Issue’ as a useful skill.

  • 60 The Investor October 9, 2016, 11:51 am

    @Gordon — Still here? You haven’t voted with Leave to stop the UK government giving passports to *anyone*. You have voted to leave the European Union, which enabled citizens with passports issued by other European Union countries to come to Britain.

    Leave voters want to debate the issues, but some of the loudest can’t even get the simplest facts right. Which of course we saw throughout the pre-vote debate.

    I’d rather get on with my weeding in the garden. 🙂

  • 61 Phil October 9, 2016, 1:08 pm

    2 points come to my mind reading through here.

    1- Free movement, its a laudable notion and a cornerstone of the EU 4 freedoms, that said clearly wither in reality or just in perception it is not working. Now the key reason for FOM is economic benefit, therefore it seems an own goal from the EU not to have been willing to re assess this. Surely there is a halfway between closed borders and completely unrestricted that ensures economic prosperity and services cross borders and pretty free movement for travelling/ work but is not a free for all?
    That this has not been addressed is surely a possible self inflicted death knell for the EU

    2. Political and media classes. With out doubt the WHOLE political class have humiliated the UK. The PM steps down away from a mess he created through inter party politics, we have an unelected PM following her own agenda pandering to the right wind of her party and fears of UKIP. Labour are just a colossal joke and should be ashamed to have left the country defenceless and for the Tories to have a free for all. and well the other parties, could be Lib Dems come back, (thought they were harshly treated for going into coalition, was the democratic thing to do to offer to the largest party first) and the SNP just seem to want to profiteer whatever the cost…..happy days.

    3- also sovereign matter….wtf does that mean anyway, we already make our own laws, personally I trust the EU to stand up to business and support poor communities more than the Torries who only know how to cut.

  • 62 Grant October 9, 2016, 1:30 pm

    Long time reader of Monevator, first time poster.

    This whole Brexit debate is both extremely fascinating and equally frustrating. As an Englishman that moved to the Netherlands to work for an international organisation (600 employees from 40 different countries in case you are reading Amber Rudd) maybe I see the debate through EU tinted glasses, but I just don’t get any of the brexit logic. Leave voters often say that it’s not about immigration. Well why aren’t they furious that the Tories and the media have turned the debate in to it being just about Immigration and immigrants? Why aren’t they mad about Amber Rudd’s proposals to force companies to publish foreigner employment numbers, or Jeremy Hunt saying foreign doctors are only here for the interim or Liam Fox saying that EU nationals in the UK are bargaining chips? Also racist crimes have risen significantly since the referendum. If I had voted brexit I’d be pretty damn annoyed that these crimes had been committed in my votes name.

    I can drive across the border to Belgium or Germany freely, I can catch a flight to Spain and step off the plane without any passport control. I can buy a house in the Netherlands but get a German bank to mortgage it as they might have the best interest rate. We can purchase goods from across the EU safe in the knowledge of EU consumer protection and standards laws There are many benefits to integration and co-operation down to the level of EU citizens, not just benefits for big corporations. Maybe the benefits are difficult to see as an island nation. Or maybe t’s because the UK has a pretty biased media and politicians with the biggest mouths getting too much air time. I don’t know, but what I do know is that it’s a big mess that won’t go away for many years.

    In the mean time, I have a Dutch girlfriend, a Dutch son and I bought a house here. In a drawer somewhere I have a little claret book that has “United Kingdon” written on it. That little book casts a bit of doubt on my future. Yes I could take a citizenship test and get a Dutch passport, but I think in 2016 it shouldn’t matter where you are from. What matters are your qualities as an individual.

  • 63 Olivier October 9, 2016, 1:38 pm

    @Phil : on your point 1, I think you suffer from a bit of UK-centric myopia. Other European countries do not have either a perception or reality issue with intra-European migration. For example, there are 3 times as many Poles residing in Germany as in the UK. Why should other European countries change their ways to pander to UK dog-whistle politics ? It is the job of the UK political class to combat the ‘perception’ whipped up by the Daily Express and publicise the actual positive economic contribution of EU immigrants here.

  • 64 Hamzah October 9, 2016, 1:58 pm

    @Holmesy999 >What I would like to get some articles on is where to invest in this post brexit apocalypse…

    I would second that. I have taken the opportunity of current market highs to sell quite a few UK-focused holdings since I really don’t feel comfortable being fully invested at the moment (am about one third cash at present in my investment portfolio). I’m content to trickle that back into an international tracker mixture; but with the Brexit interregnum, US Presidential election, European elections next year and that long anticiapated bear market, I am left feeling like a rabbit in car headlights.

    I don’t gain or lose by being in cash (I don’t even pay platform fees) and if I can resist an itchy trading finger it makes life a tad more serene. That article on having a buffer was timely by the way; I have set up some rules for adding funds to my tracker mixture which are testing my resolve a bit at the moment but in the end I think I will be strong.

  • 65 Adam October 9, 2016, 2:26 pm

    Why would the government guarantee the right to remain in UK for European citizens if the right to remain in Europe for UK citizens has not been guaranteed?

  • 66 MarkT October 9, 2016, 2:30 pm

    @Neverland. Why be so obnoxious? Why call me a dummy and liar for pointing out the vote was 52% – 48%? It was. The people that don’t vote are assumed not to care either way or would you have it that the only legal vote is where 32 million vote yes for something? Everyone knew the vote was a winner take all and it’s no credit to anyone who wants to wriggle out of the result with some childish maths.

  • 67 The Investor October 9, 2016, 2:42 pm

    Steve Hilton — Leave campaigner and former aide to David Cameron — has condemned Amber Rudd’s dangerous rhetoric and policies in the Sunday Times today, and good for him.

    Unfortunately it’s behind the paywall (I got mine for free by spending £10 in Waitrose — obligatory personal finance mention 😉 ) but the BBC has carried his most punchy quote here:

    He addressed his thoughts to Ms Rudd in the Sunday Times: “Hey Amber, for your next brainwave, why not announce that foreign workers will have numbers tattooed on their forearms? You might as well do the job of killing Britain’s reputation as an open, enterprise economy properly.”

    The battle between the relatively liberal free trade-minded Conservatives and the Ukip-ifying Conservatives could actually be as divisive as anything going on in the Labour party. Again, what is business and the international investors who finance our current account deficit supposed to make of this uncertainty?

  • 68 bestace October 9, 2016, 2:58 pm

    “Why aren’t they mad about Amber Rudd’s proposals to force companies to publish foreigner employment numbers…”

    Probably because it isn’t a policy proposal which will ever make it to the statute books. It was nothing more than a kite flying exercise, a piece of red meat that was thrown to the blue rinse brigade at a party conference and which has already been abandoned:

    https://www.theguardian.com/uk-news/2016/oct/09/plan-to-force-firms-to-reveal-foreign-staff-numbers-abandoned

    Same goes for Jeremy Hunt’s comments about doctors and the Foreign Office’s decision not to take advice from foreigners, which by the way also turns out not be to true:

    https://www.gov.uk/government/news/foreign-office-statement-clarifying-media-reports-on-working-with-international-academics

    A bit less hysteria and polemics on the whole Brexit debate is sorely needed. Here’s hoping we can get back to the rational evidence-based way of thinking that permeates the rest of this site.

  • 69 The Investor October 9, 2016, 4:10 pm

    @bestace — I don’t doubt you’re right that these proposals were floated in front of the conference as a bit of a crowd-pleaser, rather than as a definitive glimpse at some incoming regulation.

    But these are very testing times for the UK and its population, and as the ongoing debates show, divisive times. The Conservatives had a choice of what ‘red meat’ they chose to throw to their audience. They might have signaled a hope to cut taxes or be tough on crime or whatnot. But here they zeroed in on a massively sensitive area, that makes millions feel even more uncertain about their future than they already do — and that has many of the rest of us wondering exactly where the country is headed.

    To which point:

    A bit less hysteria and polemics on the whole Brexit debate is sorely needed.

    I don’t believe I’ve been hysterical. But either way I feel any such duty of care to not inflame matters is rather more incumbent on the ruling party and the new prime minister than a humble blogger with a personal finance website.

    If they weren’t proposing to name and shame companies who employ foreign workers to “flush out” what they call “bad behaviour”, I wouldn’t be responding to it.

  • 70 Learner October 9, 2016, 4:16 pm

    It’s like the brains switch off as soon as brexit is mentioned in any opinion column. For those riled up about someone expressing thoughts contrary to your own, try actually reading the blog post above. TI is talking specifically about the radical shift occurring within the Conservative party, and the dramatic effects this has already had on the market, let alone what the future holds. Get a grip and spare us the sniffy comments about alienating “half” the audience.

    This is by far the biggest event for the country in many years, the full effect is not yet known, it impacts *everyone* both positively and negatively, and you should be glad the implications (economic and social – this is a blog, and a weekend post at that) are being discussed.

    In US news, second presidential debate tonight. Should be wild!

  • 71 SurreyBoy October 9, 2016, 4:47 pm

    The absence of democracy and the denial of opportunity to millions has led to where we are today. The political impotence of the role of US president gave us Trump. The identikit politicians Miliband, Clegg and Cameron gave us a dominant SNP in Scotland and Corbyn at the helm of Labour. Now we have Brexit and today the Labour shadow brexit minister is calling for immigration to be reduced.

    France is building walls along the motorway in Calais. In Hungary they had a referendum on refusing access to non EU immigrants. AFD is winning seats in Germany. Austria missed out on a far right President by a whisker. Bulgaria is following France and Netherlands in banning the Burqa. The Czech President advised journalists that Muslim non EU immigrants should be deported to empty places in North Africa.

    The Brexit is a result of sweeping political change in the world. It is caused by growing anger. If anyone doubts this, re read the comments on this thread. When a bunch of mostly intelligent people with a shared interest in financial independence of all things can be reduced to Lord of the Flies in a few hours, you can see we have a problem here.

  • 72 FI Warrior October 9, 2016, 4:56 pm

    People writing off extremist ranting by ruling govts of actual industrialised countries as just some ‘high jinks’ forget at their peril that Nationalist parties also won control of their countries via slight majorities of the electorate (equating to a minority of the population) and went on to kick off WWII. What just seemed harmless jingoism morphed into xenophobia and culminated in genocide, after every genocide since then it’s been thought we are too civilised for it to happen again, until it does. If people are alarmed, they have every right to be, those who write us off as moaners/boring ought to acknowledge that if they claim to be open-minded and support the principles of democracy/free speech.

    Endlessly threatening to stop reading a site whose owner wont be intimidated into self-censorship loses its power with every repeat proving the boast is empty; that should be obvious. (If you keep crying wolf they wont believe it)

  • 73 Anarchy in the UK October 9, 2016, 4:58 pm

    Long time reader, first time commenter here. As an EU national living, and hoping to continue to live, in the UK I have been following the developments post the Brexit vote very closely. Like some of the reaction in the media, with all due respect I don’t think the above post is a fair representation of what was said at the conference, which I recorded off the Parliament Channel, or the government’s stance more generally.

    Jeremy Hunt specifically acknowledged that the NHS would collapse without foreign doctors and nurses, but he questioned if that was right given a global shortage of doctors which could lead to the UK not having enough doctors in the future. In this context training more British doctors doesn’t seem unreasonable to me.

    Amber Rudd’s proposals to force companies to disclose the proportion of foreign employees is more controversial, but even Jeremy Corbyn acknowledges that there’s a race to the bottom in wages for low and unskilled workers who are prepared to work for less. These are often workers from low wage economies and the pool of low and unskilled jobs is unlikely to grow as many have been moved abroad or become redundant through globalisation and automation. Again, it doesn’t seem unreasonable to me to address this if it means encouraging companies to employ local people on proper wages or train them up if they don’t have the required skills. Some companies, like Pret-A-Manger, admit that they prefer foreigners as they work harder, but is that a status quo the U.K. should be happy with? I’m not surprised that there are plans for educational and social reform as well.

    As for Theresa May’s refusal to guarantee EU nationals the right to stay in the U.K., she has said repeatedly that this would only be an issue if U.K. citizens living in the EU were not guaranteed similar rights by the EU. Again, this doesn’t seem unreasonable to me. More generally, I’ve read as many of her past speeches as I could find online and would agree with the commenter who said that to defuse the populist threat the mainstream has to acknowledge the issues that feed it. Read her nasty party speech from 2002 – all of it, not just the few lines the media keeps quoting – and replace “BNP” with “Brexit” and it could have been written yesterday.

    Lastly, unfortunately I don’t think soft Brexit was ever a realistic option. Even George Osborne, who recently came out in favour of a “softer” Brexit, has admitted that it would be difficult to not have some form of control over immigration given how people voted, while the EU insists that free movement of goods and services is inseparable from free movement of people. I’m sure the U.K. government doesn’t want to damage the economy – Mrs May’s 2015 Brexit speech suggests she’s aware of the risks – but it takes two to tango and given Mrs Merkel’s warning to German businesses not to lobby for a favourable U.K. deal I don’t see how this can be reconciled.

    To cut a long story short, I’m not worried by anything I’ve heard so far, but the emotionally charged debate is making it difficult to get a clear picture. That’s not helpful when I have to decide if I should a) apply for U.K. citizenship, which would mean giving up my freedom of movement, b) go back home, which would mean giving up my job, selling my flat and jeopardising my not exactly lavish DC pension, or c) do nothing. In fact, it seems that not being able to debate issues which, as one other commenter pointed out, apply to most of the developed world without getting emotional is part of how we got into this situation. That’s the real tragedy to me – that Brexit could have been avoided – but now you can’t put the djini back into the bottle.

  • 74 zxspectrum48k October 9, 2016, 5:11 pm

    SurreyBoy: The absence of democracy and the denial of opportunity to millions are genuine issues but I can’t see the how people find that correlated with the EU.

    The UK is weak on democracy. An inbred Monarchy, an unelected second house, a FPTP system (my vote has never yet counted in an GE and I’m in my early 40s). We give a good impression of being a democracy but I can never shake the feeling that if you scratch beneath the surface the land/property-obsessed feudal state in alive and kicking! In terms of opportunity and social mobility, the UK has nothing to be proud of. Our Gini coefficient on an income basis is through the roof. We look better in wealth terms but that’s just because our feudal overlords put it all in trust generations ago …

  • 75 WhiteSheep October 9, 2016, 5:24 pm

    On the subject of how to invest in the wake of Brexit – or rather in the context of a devalueing currency.
    Of course, as a passive investor with a globally diversified portfolio one shouldn’t really change anything per se. Personally I track my savings and investments in multiple currencies (not all are based in the UK), and I must admit that I am almost a bit stunned how effective diversification has been. While my net worth has gone up by more than a year’s salary in pounds it has barely moved in dollars and euros. I guess implicitly that means that I don’t need to worry too much about future inflation arising from a weak pound.
    As somebody who is not entirely certain where they are going to live for the rest of their life, what has traditionally worried me more than the investment performance is how to hedge against future expenses that may occur in different countries. The most extreme case because of the long time horizon seems to be around retirement and pensions. If you already know what to expect (like RIT?), it is probably prudent to shift more investments to the relevant currencies? Personally I have sort of formed a weighted average between the likelihood of a long term move to different locations and the expected expenses in local currencies in those scenarios and then allocated the fixed income parts of my portfolio accordingly, e.g. some of my savings are in Euro accounts rather than pounds. It has the other benefit that I rarely need to worry about converting currencies for smaller expenses (like holidays).
    Curious to hear if anyone has any pointers towards more systematic approaches to these type of “lifestyle” currency hedges?

  • 76 Learner October 9, 2016, 6:27 pm

    WhiteSheep, that’s what keeps me up at night too. The currency risk of moving around the world can dwarf movements in equities. Reversion-to-mean doesn’t really apply, and while there are long term trends like the decline of GBP/USD, that can be completely disrupted as recent events have shown.

  • 77 Hariseldon October 9, 2016, 7:04 pm

    Could The PM’s position being a negotiating tactic ? Perhaps she is far more shrewd than she is portrayed?

    If you start with I want to stay but must appear to leave, your negotiating position with the REU ( Remainder of European Union ) is very weak.

    If you then say I accept that you could make life difficult, so I will leave anyway and take the consequences, WTO rules etc then REU is powerless, their negotiating power is gone.

    Now hopefully over time a more accommodative tone will be set, when people on both sides get used to the idea, Euro elections are out of the way and the need to “cut your nose to spite your face” becomes less attractive to all and perhaps common sense takes hold, REU has demonstrated that leaving is unpleasant….. but an accommodation is reached, slowly…

    In a relationship bust up, it starts we’ll be grown up about this and there is a phoney peace, then the shouting and throwing your toys out of the pram really gets going and 12 to 18 months or so later common sense often prevails, a new relationship is obtained.

  • 78 david m October 9, 2016, 7:16 pm

    @ Anarchy in the UK
    Thanks for your well considered points.

  • 79 Neverland October 9, 2016, 7:30 pm

    @Harlesden

    Unfortunately the national politics of the major players dictate the most brutal of ruptures

    UK – Conservative party unity dictates a remain voting prime minister must be seen to be tough with the EU

    France, Germany, Spanish and Italy – local politics dictate that any except the status quo and established political parties/frameworks will result in poverty and chaos. Remember the rough justice meted out to Southern Europe

    Poland – Their current government just wants to stick to foreigners rather like ours

    The only EU country in our corner is Ireland who are small and still on the EU naughty step

  • 80 Gordon October 9, 2016, 7:30 pm

    @ TI, yes I’m still here. It’s fascinating watching someone that has spent years building up a website declare war on a substantial part of his readership.

    Perhaps one of your future articles could be on when business leaders drop a clanger? Gerald Ratner springs to mind.

  • 81 CollReg October 9, 2016, 7:35 pm

    Shortish term reader, first time commenter.

    Some points to consider with respect to Hunt’s announcements:

    – He announced in parallel increased medical student places, but these would produce fresh new junior doctors in 2023 at the very earliest. A good couple of years after we stand to lose our legions of EU doctors if the current Hard Brexit trajectory remains unchanged.

    – Even then they would be fresh-faced provisionally registered juniors, not the variety of experienced foreign docs the NHS currently employs.

    – Furthermore there already rota gaps throughout the NHS, a foreign exodus would exacerbate these for a solid decade, while the new doctors would only replace what’s left not solve the actual (rather than political/ideological) problem on our wards.

    – Hunt also proposes chaining new medical graduates to the NHS for four years. Possibly a shrewd move, considering the moderately large (though overstated) cost of training medical students to that point. However even Beardy Branson knows that treating your staff right is the first step to a successful organisation, and as the aforementioned rota gaps are set to continue, engendering goodwill in those who cover them out of professional duty would seem more prudent than establishing a relationship of bad faith.

    What does this add up to? The UK’s largest employer being once again used as a political pawn? Further impetus to buy in UK healthcare markets because their future is looking bright given Hunt’s seemingly endless drive to destroy the NHS by 1000 cuts?

    Also interesting to note how the press largely took his speech at face value, possibly due to the more outright craziness being spouted by Rudd and even our dear PM.

    DOI: Medically inclined

  • 82 Duncurin October 9, 2016, 8:07 pm

    As human beings we frequently make bad decisions, and finance blogs spend a lot of time trying to prevent this. As for individuals, so for crowds. The fact that referenda are democratic only ensures that they accurately represent the average opinion of the electorate at the time. It doesn’t guarantee that the decision will be a good one.

    Someone who thinks a referendum decision was bad is perfectly entitled to try to mitigate the effects of that decision, or to attempt to change public opinion by legal means (such as the writing of blogs).

    Of course we are biased towards decisions we have already made. But when I see people getting emotionally upset when the referendum result is criticised, I suspect one of two things is happening. Either they subconsciously fear their decision may have been wrong, and have suppressed the thought, or they fear that public opinion may turn against the decision before it becomes irreversible.

    Maybe both?

  • 83 Mathmo October 9, 2016, 8:15 pm

    Thanks for the links TI. I must confess sterling’s drop triggered a bunch of rebalancing from me. Possibly over-balancing: I hope I don’t fall over. Like gilts last year, I’m calling it. Probably wrong again.

    As for the comments induced by Brexit’s reemergence, I think Douglas Adams helps here:-
    “Curiously enough, the only thing that went through the mind of the bowl of petunias as it fell was Oh no, not again.”

  • 84 Gordon October 9, 2016, 8:20 pm

    I worked in the Sultanate of Oman. Migrants were legally prohibited from doing certain jobs like taxi drivers. It was a major government policy to increase the amount of jobs done by Omanis and reduce the number of migrants. For instance my Zimbabwean friend was reported to the Government for doing a job that should have been done by an Omani.

    All the things that the Tories are talking about are fairly standard practice in the rest of the world.

    The Bremainers should either start listening

  • 85 The Investor October 9, 2016, 8:42 pm

    It’s fascinating watching someone that has spent years building up a website declare war on a substantial part of his readership.

    War? A touch melodramatic. Let’s look at what’s actually happened.

    I’ve decided to occasionally write, on my own website, about the most important topic in the UK today, which I feel pretty engaged with, and which has at least a tangential relationship to wider investing themes.

    When I do, invariably a few Leave voters turn up to tell me to knock it off.

    I don’t — and won’t — and some of them won’t take no for an answer. I perfectly understand they might not like to read it. There’s stuff I don’t like reading on the Internet. I don’t read it. Perhaps they’re masochists.

    There are reasonable and articulate Leave voters in the Monevator readership; I’ve had emails from them now and then, and they have commented from time to time. But there’s also this fairly inarticulate bully boy brigade who are frankly wasting their time.

    They may count themselves among the majority in the UK population, judging by the referendum, but I highly doubt they’re even in a large minority here. But even if they were in the majority I wouldn’t stop writing about what I want to write about.

    I keep these comments open because I feel it’s better to have different views aired than to talk in echo chambers, but if I decide in the end the Brexit articles have just become a platform to the sort of pointless trolling that has overrun places like The Telegraph and The Guardian, I’ll either delete their comments or turn comments off.

  • 86 TT October 9, 2016, 8:45 pm

    I’ve read a lot of crazy comments on this blog over the years. That one takes the cake.

  • 87 FI Warrior October 9, 2016, 8:45 pm

    Perhaps half of this country’s people would rather live in a civilised country rather than a third-world, tinpot dictatorship.

  • 88 david m October 9, 2016, 9:31 pm

    @ TI

    I think you could usefully write more about the investment implications of Brexit and less about the politics, e.g. should we invest more in international and UK FTSE 100 equities and less in UK mid cap and small cap, or should we just invest in a Vanguard global tracker, and try and ignore the Brexit noise for the next two and a half years.

  • 89 Malcolm Beaton October 9, 2016, 9:45 pm

    Gentlemen,Gentlemen
    Should we return to our main purpose-investing
    Brexit,2008 Banking Crisis,2000 Tec meltdown-we will see more of these before our game is done
    Personally I work with the things I can control–my Portfolio
    Thanks to Monevator and other websites like it I am Retired-13 years into Drawdown with a Portfolio of Index Trackers -Bonds and Equities-diversified across the world
    As US is 50% of the world market my Portfolio is in a very healthy state
    No doubt I will need the extra pounds to pay for more expensive holidays ,food etc!
    Back to basics guys-tomorrow always comes-lets concentrate on what we can influence and
    deal with world as it is-back to investing!
    xxd09

  • 90 zxspectrum48k October 9, 2016, 10:25 pm

    @Gordon. I’m aghast that you want to the UK to converge with a dictatorship. Moreover, who cares what country any taxi driver comes from? There aren’t going to be any taxi drivers in 20 years; the cars will drive themselves.

  • 91 PC October 10, 2016, 7:52 am

    Just popping in to say good morning before comments are inevitably closed.

    Political risk is the biggest thing worrying me at the moment. Please don’t stop writing about it.

  • 92 John B October 10, 2016, 8:13 am

    @Whitesheep

    I now have a XDR/SDR box in my wealth spreadsheet, so I can measure it against a basket of currencies, and eliminate much of the pound down, FTSE 100 up problem.

    As a rule of thumb it seems a good idea to have your wealth in the places where your expenses come from, so abroad for foreign holidays and imports like white goods, oil and food, UK for labour, which will dominate. Most of my long term costs will be UK based, but I plan to do lots and lots of foreign travel. I’m currently 1/3 abroad, but its actually more than that as the UK component is mostly FTSE 100. I plan to move some to the FTSE 250 over the next year. But with a house inheritance, civil service and state pension to come, there are other UK assets to add, so its really had to get a true exposure picture.

    I’m badly underweight in the US, only 3% explicitly there, but even as a passive investor, I just felt the market timing was wrong for the last 5 years, for CAPE reasons as much as currency.

  • 93 The Investor October 10, 2016, 10:31 am

    Closing comments now as the working week has begun and these Brexit debates take more than usual moderating. (Not just responding to views but making sure outright racist stuff doesn’t get through the filter and on to the site etc).

    Thanks to *most* people who shared their views, whether pro or anti.

    Have a good week! 🙂

  • 94 Mroptimistic October 10, 2016, 6:37 pm

    So there you are MrInvestor. Standing square and facing us. We are the English. Look at us.

  • 95 The Investor October 10, 2016, 6:59 pm

    Just opening up this thread for a moment to transfer over Mroptimistic’s bizarre comment above, which was contaminating the latest Slow and Steady Update thread as the poor dab posted it on the wrong article in all the excitement yesterday.

    While I’m here, I was just re-reading these comments and — not even considering the ones that I deleted for being too grim or that were even before then held by the spam software for various reasons — we see from a certain faction of Leave voters an ugly tone of nationalism, xenophobia, utterly incorrect information such as Brexit having anything to do with what passports are issued by the UK government, repeated calls for me to stop posting my own views on my own website, culminating in an appeal that we should look to an absolute monarchy for moral leadership.

    (You can have a read of that exemplary country’s human rights record with this sourced article over at Wikipedia: https://en.wikipedia.org/wiki/Oman#Politics).

    Whenever I or others suggest a significant faction of Leave voters (not all) hold xenophobic if not downright racist views, we’re accused of being some sneering Metropolitan elite.

    Again and again though that faction reveals what it is within just a few exchanges — even when they know I’m deleting comments and so forth, and so are undoubtedly self-censoring.

    This tendency is of course not news to anyone who spent five minutes watching the campaign, who has read far worse comments on other sites and Internet forums, or even much of the heavily vetted and deliberately balanced coverage such as the BBC’s Brexit Street: http://www.bbc.co.uk/programmes/p042n517.

    I’ll continue to trust my own judgement as to what voting Leave meant to a significant cohort of people — and I’ll decide on my own whim what I write about here.