Actual economic effects...

[Spinflight]

FTSE closed on Wednesday at 6138. Closed on Friday at 6138.

Long term borrowing rates have come down as brexit appeared more likely, 10yr ones from 2% down to 1.09% post brexit. Similarly all the European long term borrowing rates rose sharply. Lesson? We are a less risky and more credit worthy outside the EU than in.

One ratings agency did drop our credit worthiness, though oddly the last time they did was out of fear of Eurozone contagion. Seems completely at odds with the long term borrowing rates, which matter quite a great deal given our debts.

The pound dropped, quite significantly. It appears however that there was some 'unusual' activity in the market which forced it down whenever the Leave campaign polled well. To the extent of trying to sell it when there were no buyers.

Some people lost a great deal of money, probably dwarfing the millions contributed to the remain campaign, lets hope it was Goldman Sachs and JP Morgan. :)

Yes but the deals were with the US and EU, the bigger the organisation the harder it is

International trade deals just take a long time because they are very, very complex - 4-5 years at least. Canada's will be 8 years by the time it's implemented. That's just the reality. And they require an amount of experienced international trade negotiators we simply don't have. Nor do we have any politicians I think who have ever been involved in high level international trade negotiations.

The EU is free to reject terms of the US trade deal it doesn't like. If we want a deal quickly, then the US & the EU are in a very strong position.

That means the very real possibility of US corporations having the ability to take the UK government to court if we do something that disadvantages their profits; and for their input into our own regulations - consumer, environmental, safety etc. So if we want to put cigarettes in plain packets Phillip Morris could take our government to court - as it did the Australian government.

Equally, it means the real possibility of having to implement EU laws we will no longer have any say in forming.

Lets note on the Phillip Morris comment that it was an ISDS from an old deal signed between the Australia and Hong Kong, and PM lost!

Yes of course all that is true. But there almost needs to be a weaker party for it to be agreed. The EU stuff is interesting as the main issue is our proximity to them, which in a way should be a good thing. If we were the other side of the world and already had convergent laws it would be as straightforward as EU trade agreements can ever be.

In relation to time though this is the time to finalise stuff, it's not like you'd have no trade for 4 years then suddenly bam, it will be working and trading towards. I think a provisional EU deal will be agreed within the 2 years, lets hope I'm right.

The fact PM lost is not the point - but that they even have the ability to sue a foreign government over consumer safety regulations.

That the case was via a non-US deal is not really relevant as it used the ISDS mechanism, and Phillip Morris is a US company. Although it's true I should have made that clear in my post.

ISDS is not necessarily a bad thing, many MNCs need reassurance about national government behaviour regarding assets before investing in other countries.

You are right that PM shouldn't have been able to bring this case, interestingly there appear to be caveats in TTIP that allow national governments to "rule" and protection for national monopolies etc.

It's very easy to agree trade deals quickly: you simply roll over and sign up to whatever the other party proposes.

In other words, it's easy to make bad deals. I sincerely hope this isn't what David Davis is proposing.

The other issue is that it's easier to make narrow trade deals that cover only a limited number of manufacturing sectors. It's much harder to make wide-ranging ones that also cover, for eg, services.

Takeover of ARM? Not a good thing surely and the cheap pound means this must be a factor.

UK firms slash spending plans after Brexit vote

www.theguardian.com/business/live/2016/jul/18/uk-economy-firms-slash-spending-financial-news-brexit-arm-holdings-softbank-live#comments

larry in the last 5 years GBP/EUR has varied between around 1.13 and 1.43.

Perhaps we have different views on what stability looks like. Everyone else can make their own minds up. I still don't understand how hurting the trading relationship between entities benefits either of those entities. Especially when the stated aim of both of those entities is to continue trading with each other as much as possible.

An administrative, rather than economic, effect: Apparently the emerging de-facto head of 'Team Unicorn', David Davis, has said he has permission to head-hunt the brightest and best from any other Govt Dept. Which is arguably the right thing to do.

It doesn't bode well for the successful implementation of policy in the rest of Govt, though. And God knows it wasn't exactly perfect to start with.

Apparently the emerging de-facto head of 'Team Unicorn', David Davis, has said he has permission to head-hunt the brightest and best from any other Govt Dept. Which is arguably the right thing to do.

Oooh, fascinating.

I wonder how that will work in practice?

I wonder how long it will take all those newly-appointed ministers to get pissed off with it?

Never mind the ministers.

The permanent secretaries aren't going to just let their best staff go without a fight.

It will also create interesting incentives for civil servants.

But yes, having all your staff poached by David Davis before your bum has even warmed your seat is not going to be attractive

"An administrative, rather than economic, effect: Apparently the emerging de-facto head of 'Team Unicorn', David Davis, has said he has permission to head-hunt the brightest and best from any other Govt Dept. Which is arguably the right thing to do."

I've heard this too from a friend who works for a charity involved in several projects with government departments. All their projects have now been put on hold (or might be cancelled) because the civil servants seconded to them are being pulled back to work on Brexit. All top civil servants with economics background / training.

So David Davis, a man who failed to get into uni first time round, science degree, career in business, supported the death penalty and voted not only against gay marriage, but against repealing section 28 & the lowering the age of homosexual consent. Why is the future of this country in his hands, precisely?

Taken from another thread:

Minister for Brexit David Davis appeared unaware of how EU trade deals work

Manon,

You say 'science degree' in such a sneering manner. You might be interested to know that he also has an MBA from the London Business School and has studied at Harvard (good enough for you?). He also proved himself successful in a major company. (see below for reference: yes it is Wikipedia but please point out where it is incorrect, if so).

Angela Merckel is also a scientist, as was Margaret Thatcher. In fact the more scientists in government, as far as I am concerned, the better for the country.

'On leaving Bec Grammar School in Tooting, his A Level results were not good enough to secure a university place. Davis worked as an insurance clerk and became a member of the Territorial Army's 21 SAS Regiment in order to earn the money to retake his examinations. On doing so he won a place at the University of Warwick (BSc Joint Hons Molecular Science/Computer Science 1968–71). Whilst at Warwick, he was one of the founding members of the student radio station, University Radio Warwick. He went straight on from there to London Business School, where he got a master's degree in Business (1971–73), and, later, Harvard University (Advanced Management Program 1984–85).

Davis worked for Tate & Lyle for 17 years, rising to become a senior executive, including restructuring its troubled Canadian subsidiary, Redpath Sugar.[4] He wrote about his business experience in the 1988 book How to Turn Round a Company.'

Well even after all that he wasn't aware in February that you can't sign individual trade deals with EU countries, which suggests a particularly poor starting point.

Smallfox,

Another sneerer? So what? How long do you think it will take him to learn: a day, a week, a month? Given that he will be excellently briefed. prior knowledge is a very small part of doing a management job well, especially when you can recruit the best technical minds on to your staff.

It wasn't the science degree I was sneering at.

The point is that he doesn't apparently have any experience in the area in which he is now dealing.

And his opinions suggest an unenlightened outlook.

How long do you think it will take him to learn: a day, a week, a month?

Learn??? This isn't 'In At the Deep End'.

This is supposed to be the man with the Brexit plan. He hasn't got one any more than Boris or Gove or Farage.

The man in charge of some of the most important trade deals in UK history doesn't apparently have a clue how they work.

Even for highly educated people, it can take a long period of time to be comfortable with technical subjects. In my department we regularly recruit science PhDs (who work alongside economists on technical market forecasting) and it typically takes a couple of years before they are productive.

David Davis will be an administrator and decision maker, he won't need to understand the intricacies but he will need to have a perfect grasp of the basics. It's very concerning that his public statements suggest that he is less informed on trade than a bunch of "bankers' wives" (j/k) on mumsnet ;)

Yeah I'm going to sneer at a politician who has served in the houses of Parliament for nearly 20 years and was minister of state for Europe for 3 years, and yet still doesn't understand how the free trade agreements work.

Is that good enough for you? I'm not asking a layman in the street to be an expert, I'm asking someone who is an elected MP and was a minister responsible for dealing with the EU to know how it works. I'd suggest that the fact that he didn't suggests a rather high degree of incompetence.

But pass it off as sneering larry, if it suits you., just like your compatriots when you hear something you don't like you go on the attack. Suggests that your arguments lack intellectual rigour really.

Sorry, 30 years in the house, not 20. That makes it worse.

It is common for new ministers to lack experience in their new job. The difference is that usually they are able to rely on civil servants to provide the expertise they lack. Davis is taking on a new department with a distinct lack of existing expertise available. In that context, his failure to grasp even the most basic concepts (such as individual EU countries not being able to negotiate on their own account with the UK) is particularly worrying.

Of course if he's been set up by May to take the fall then it may not matter. The news today that he will have to share his official second residence with Boris and Fox suggests that May has a particularly sadistic sense of humour.

Like I said even more worrying as he was Minister for the EU between 1994 and 1997. He's also a europsceptic and voted against the repeal of section 28.

What a fine man to be representing us.