Geopolitical impact of Brexit

[Hazir]

Let's see how rich 'you' are when you're no longer allowed to handle our money affairs.
Let's see how rich 'you' are when we stop allowing your subsidized agricultural products in.
Let's see how rich 'you' are when third country producers leave your shores because you are no longer a gateway to Europe.
Let's see how rich 'you' are when London no longer can function as a travel hub for Europe the way it does today.
Let's see how rich 'you' are once you have the guts to tell us you are leaving.

Get used to a future in which the PM of Malta has more say in how you do business with Europe than your own PM.

[RandBlade]

You are so delusional its hilarious. You're like the pub loudmouth that everyone rolls their eyes at who thinks he's the big I am but everyone knows is just a joke.

[Flixy]

Not that I disagree that a decent deal would be best for everybody, but it's naive of you to think that the EU needs the UK more than vice versa.

[Aimless]

You are so delusional its hilarious. You're like the pub loudmouth that everyone rolls their eyes at who thinks he's the big I am but everyone knows is just a joke.

This post is very nutritious due to its high iron content.

[RandBlade]

Not that I disagree that a decent deal would be best for everybody, but it's naive of you to think that the EU needs the UK more than vice versa.

The UK isn't the one proposing there should not be a deal. I think the UK has opportunities to work with the whole world and the EU is a part of that package of that of course. Hazir doesn't seem to be able to see past his own little package ...

[Flixy]

The UK isn't the one proposing there should not be a deal. I think the UK has opportunities to work with the whole world and the EU is a part of that package of that of course. Hazir doesn't seem to be able to see past his own little package ...

And the same from your side, which makes for an entertaining but not very productive 'discussion'

[Loki]

Just like Palau has the opportunity to trade with the entire world, while the US only has one Palau to trade with. I guess that gives Palau leverage in any kind of trade negotiations.

[RandBlade]

Is Palau's economy 20% of the size of the US one?
Does Palau have a considerably greater GDP per capita than the USA?
Does Palau contribute a vast amount to the US Federal Government?
Is Palau growing considerably faster from the US?
Is Palau America's number one export market?
Has Palau been forbidden from signing any trade deals with anyone outside North America, a restriction now getting lifted?

[Loki]

Simple question: what is bigger 20% or 500%? Why would anyone in their right mind think the former gets a better negotiating position?

[RandBlade]

I have regular customers I am more than happy to treat different to other customers, they sure don't represent 20% of my custom but it's enough. Your best customer should always be treated well, especially if that customer has a lot of new opportunities to take their business too that weren't there before.

[Hazir]

Simple question: what is bigger 20% or 500%? Why would anyone in their right mind think the former gets a better negotiating position?

If you're a Brexiteer living under the delusion that Brexit is a success before it even started though.
Randblade also doesn't understand that for an economy of the size the EU has, exports actually aren't all that important at all, regardless of who your biggest market is.

[Loki]

I have regular customers I am more than happy to treat different to other customers, they sure don't represent 20% of my custom but it's enough. Your best customer should always be treated well, especially if that customer has a lot of new opportunities to take their business too that weren't there before.

That makes zero sense. The EU isn't the firm selling something to UK, the consumer.

And I love how you never reverse your logic. The EU can take its business elsewhere, which means Britain needs to treat the EU well. Of course that's as absurd a statement as yours above. We have negotiations between two sovereign powers, and push comes to shove, the one that's stronger is going to get a better deal. This is a rehash of the Greek bailout debate, where Greeks seriously believed they'd get the better bargain because they had morality, socialism, and pink unicorns on their side.

[Hazir]

Seems like the Swiss have figured out their mess with their referendum on the reduction of immigration while still keeping their bilaterals with the EU alive; their newest proposal boils down to the possibility of obliging employers to report their vacancies to local job centers, then on top of that there are some vague rules that all need the express consent of the EU in case they are not compatible with the free movement principles.

We could give you British a deal like that; you control your borders according to rules we allow you to make, you will contribute to the EU structural funds to the tune of €200 million a week, you will follow all common market rules, no questions asked and certainly no opt-outs, an in exchange for that you will not get any money out of the structural funds, so no more CAP for you.

[RandBlade]

If you're a Brexiteer living under the delusion that Brexit is a success before it even started though.
Randblade also doesn't understand that for an economy of the size the EU has, exports actually aren't all that important at all, regardless of who your biggest market is.

Exports not important? That doesn't even work as a claim for any nation. Let me think what you could possibly mean: For the economy to be the size of a mere $30,548 GDP per capita then yes exports may not be that important. For more global economies like ours which is nearly 50% bigger per capita than yours at $41,778 per capita (and growing at a faster percentage not just nominal amount) then exports matter for us.

Maybe if you start taking economics and trade seriously you'll stop being such a basket case.

That makes zero sense. The EU isn't the firm selling something to UK, the consumer.

No, BMW etc are. The EU is supposed to represent those firms in trade talks.

And I love how you never reverse your logic. The EU can take its business elsewhere, which means Britain needs to treat the EU well. Of course that's as absurd a statement as yours above. We have negotiations between two sovereign powers, and push comes to shove, the one that's stronger is going to get a better deal. This is a rehash of the Greek bailout debate, where Greeks seriously believed they'd get the better bargain because they had morality, socialism, and pink unicorns on their side.

Two mistakes here, firstly we have shown that the EU is patently incapable of agreeing major new trade deals outside our continent, TTIP is dead in the water. So if the EU cuts off free trade from their single biggest export market (bigger than the whole of the USA) then with TTIP dead and CETA seeming to die too then where are they going to take their business to?

The UK is opening up to the whole world with negotiations beginning with many nations outside Europe. Once we're free from the EU's shackles we can sign trade deals with these nations the EU that "doesn't need to export" spurns.

As for the Greeks you have the situation reversed. The Greeks were recipients in those talks, they were supplicants. The Germans were writing the cheques. With the EU, the EU is the recipient, we are writing the cheques. Completely reversed scenario.

[Hazir]

For a small country like England exports may be a big part of their economy, bigger economies and especially bigger developed economies, by their very nature are more self-reliant and much less dependent on international trade. The reason why the EU has a limited number of trade agreements lies first of all in the fact that any trade agreement is complicated, and secondly in the fact that the EU, unlike smaller countries, does not need those trade deals so much and thus doesn't feel the urge to roll over on its back at the first indication a country may be willing to put pen to paper. The fact that TTIP is moving slower than usual is that in that case both parties are big, not in desperate need of a deal, and have to operate in an environment where free trade is getting a lot of negative attention from leading politicians.

As for checks you are supposedly writing; the premise of the talks you are going to enter in (at least on your side) is that you won't be writing them any longer. So I can assure you that having written them in the past isn't going to give you a whole lot of leverage in the talks.

Really, the funnest part here is that the lot that you put in charge of Brexit seems to be as clueless as you are about what mess they are wading into; once this process starts your economy will start showing big cracks in the most unexpected places. Without being part of the common market England no longer will be an attractive part of any chain of production so any of your exports to the rest of the EU that contain components from the EU may very well evaporate rather than be part of your 'offer to the world'.

P.S. I see the Chinese have already manhandled you into building a nuclear plant you don't really want.

[RandBlade]

Your "we are self-reliant" spiel might hold some water if the EU was a developed economy that was self-sufficient in materials and resources. But that isn't the case.

USA GDP per capita $53,041
UK GDP per capita $41,778
EU27 GDP per capita $30,548

Some "bigger developed economy" you have there, well done. If you're perfectly content to settle at three quarters of our GDP per capita and less than 60% of Americas then good for you. I'm not prepared to settle for that little.

As for the nuclear plant, I've supported nuclear power all along. Only bit of that deal I'm not sure about is the strike price seems wrong, but it is a major investment.

[Hazir]

I don't know what you are trying to prove with those figures. In all the history of mankind the balance of power was never based on GDP per capita.

Also, most of the UK, except the area including London has a GDP per capita lower than the EU average. FYI; London would be the region most negatively affected by your foolish Brexit vote.

[RandBlade]

If you want to "have power" by having a continent full of impoverished people who don't trade then good for you. I'd rather be open to the whole world and be smaller but wealthier. Being big but poor is not impressive.

As for your claim that most is below average that is just fallacious. As for London, jealous EU powers have tried to cause harm to London for quite a while now, there's a reason there isn't and won't be a single rival city to London in the whole of the EU. For as long the EU considers finance to be a dirty word, which is only going to get worse without us injecting sanity, that is going to be the case. We will provide financial services to you from outside the EU just as we provide financial services to America, India and China from outside those nations.

[Hazir]

You don't seem to understand the message; it is not that we don't want to trade with you. It is that we won't trade with you on your terms. From now on we will deal with your on our terms.

London up till right now is a city within the EU and thus part of the common market. What the EU can do or not with London is ruled by the rules of the common market. Once London is no longer inside the common market, what the EU can do to London is purely a matter of our interests and those will no longer be reigned in by common market rules*. I doubt there is a tendency to start an economical war with you, but even disregarding your interest may be so harmful to you that on your side it could feel like you're under attack. We don't have to punish you at all to make you feel you made a foolish foolish mistake. All we need to do is safeguard our own interests and the bleeding on your part starts.

Little Englanders like you are finally going to have to face up to what it means to be out on your own.

*We couldn't take euro-clearing from you, but soon we can, and if we want it we will, and we can limit the freedoms to service the common market from London based financial institutions to the extent that it no longer pays for them to be based there. Also our governments no longer will be considering bids by british financial institutions for services, at least, they will no longer be obliged to consider them. Your City is about the right size for the EU economy, it's vastly oversized for your own economy. And it will not continue as is outside the common market.

P.S. funny thing is that I personally should thank you and your Brexit voting lot; there is a significant upwards pressure on rents in central Amsterdam due to your folly. Your vote probably means my personal income is going up quite a bit.

[RandBlade]

What you say might bear a slight resemblance to reality if London was simply about Europe, it is not. Most London international trade already is already for outside the EU and London based financiers liberated from sclerotic control will run rings around whatever regulations you try and throw up.

As one example, just as historically the Eurodollar was made popular by London banks which is not subject to the Federal Reserve regulations, similarly London businesses are free to trade the weirdly-named Euroeuro's without observing regulations from the ECB.

I think financiers have a bit more wit and ingenuity to them than your slow moving behemoth.

[Hazir]

Your fantasies of being freed of foreign regulations are too ridiculous for words. Even if you are entirely trying to function as some off-shore banking haven as you appear to have in your wet dreams you'll be fully regulated by rules set in Washington DC or Brussels or nobody besides drug lords will bother to use the services of your banks.

[RandBlade]

This may surprise you but we already trade with America. In fact it's our number one export market (like how your number one is the UK).

[Hazir]

So? Do you seriously think that trade makes you some extremely tasty bagel?

[RandBlade]

Yes.

Denial not just a river in Egypt it seems: http://www.telegraph.co.uk/news/2016...-if-they-make/

[Hazir]

Seems to be that the actual story there is that the right wing press in the UK is in denial. They can't believe we're willing to give up on the UK if the UK doesn't want to deal on our terms. Yet, that is what is going to happen for the simple fact that what enrages people in Europe more than anything it is the fact that there are too many opt-outs, too many exceptions, too many fudged deals.

[Aimless]

I distinctly recall reading a couple of years ago that about half of all UK citizens live in regions with PPP-adjusted GDP per capita comparable to Eastern European EU-member states. I'm also a little uncertain as to how much of their GDP consists of govt. spending but it should be on the high end compared to many European states. London and the London commuter belt seems to be a very different region from the rest of the UK.

[Aimless]

Btw, does anyone know if financial services would be regulated in the same way as goods if trade between the UK and the EU ends up being regulated by WTO-rules rather than by a free trade agreement? Ditto for trade between the US and the UK.

[Hazir]

Btw, does anyone know if financial services would be regulated in the same way as goods if trade between the UK and the EU ends up being regulated by WTO-rules rather than by a free trade agreement? Ditto for trade between the US and the UK.

Neither freetrade deals nor WTO rules cover financial services. The minimal access rule you can expect is that the opposite party financial institution is being supervised in a way similar to that applying to your own markets. The big question then becomes; who is the supervisor to be recognized so that banks can operate outside their borders? If for example the british oversight is considered to be light-touch, their banks may be excluded from doing business in Europe.

Randblade doesn't understand that all that is needed for them to bleed business, is us not giving them a special deal. We don't have to punish them at all, just not give them preferential treatment.

[Loki]

http://mobile.nytimes.com/2016/09/16...itvinenko.html This is what a post-Brexit Britain looks like.

[Hazir]

But hey, the world is their oyster.