business

Asian automakers fret over uncertainty ahead after Brexit vote

4 Comments
By Norihiko Shirouzu

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Dark and uncertain times are head for the UK. The UK and the politicians have been so focused on the issue of immigration, and they have not thought through the implications on small, medium and large businesses that trade with Europe, and the world. already some of the politicians have started to back peddle on some of the issues IE where some of the money that we give to Europe was ear marked for the NHS, personally I think having this referendum has done us no good and it could put us back into another small recession, money has been wiped of the price of the stock markets, exchange rates have fallen, we have entered uncharted waters with no chance of going back. only time will tell if it was the right decision.

1 ( +3 / -2 )

Brian.

One thing I was thinking how much of the current problems are/were caused by the British Government and not the EU.

No need to reply as I ask myself the same about my country. Been thinking of moving back but the current situation economy, etc don't look good at the moment.

0 ( +0 / -0 )

Astom Martin is going ahead with investments for its new plant in Wales, Boeing's new European office will be in the UK.

1 ( +1 / -0 )

Dark and uncertain times are head for the UK. The UK and the politicians have been so focused on the issue of immigration, and they have not thought through the implications on small, medium and large businesses that trade with Europe, and the world. already some of the politicians have started to back peddle on some of the issues IE where some of the money that we give to Europe was ear marked for the NHS, personally I think having this referendum has done us no good and it could put us back into another small recession, money has been wiped of the price of the stock markets, exchange rates have fallen, we have entered uncharted waters with no chance of going back. only time will tell if it was the right decision.

Another recession is unavoidable, regardless of the "Brexit". Money has been wiped off the price of stock markets, but these markets are greatly overvalued to begin with, and their recent high prices are mainly the result of central bank manipulation of interest rates and money supply, and not the result of increased sales or private sector economic activity. Dark times began when the ECB introduced negative rates.

Though it may seem that immigration and smaller issues are the main driver behind the Brexit, there are other reasons which are less obvious. The main of these is reducing the ECB's influence on the UK's financial system. The ECB (along with the BOJ and FED) has enacted increasingly absurd policies which threaten the foundation of our financial and economic systems. The major stock markets are now almost entirely reliant on the central banks for continued growth, growth fueled by zero rates and the printing of more currency. No longer does the stock market rely on the performance of the companies whose stock they trade; a year of record profits or record losses has less influence on a company's stock value than fractional change in interest rates. This is absurd, worse yet, it creates the potential of economic catastrophe the likes we haven't seen since 1929.

Banks no longer derive the greater part of their profits from changing interest on loans, and in order to make money, they have to create ever more exotic investment instruments, and invest in ever riskier ventures. And the current lack of real economic growth means very little return on conventional investments, so the only way they can make money is to play the current stock market, which of course is dependent on the central banks for growth, growth fueled largely by borrowed money, or money created out of thin air, and loaned out at the current low rates.

The UK is wise to remove itself from the direct influence of the clowns running the ECB. And I hope those who are running the banks in the UK do as they historically have, to run their businesses following sound and honest practice. When the economic houses of cards created by central bank policies and government mismanagement collapse around the world, the UK may be the only one left standing.

3 ( +4 / -1 )

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