UK - Will it be better for the stocks and shares if Britain Leaves the EU DISCUSSION

Discussion in 'Politics Discussion' started by Maple Archgate, Apr 23, 2016.

  1. Maple Archgate

    Maple Archgate Member

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    In England, we are constantly being bombarded by people telling us how to vote on leaving the EU. I have noticed considerably more eastern Europeans applying for a job offering whenever I have a vacancy, but I have also found that these people will work considerably hard, even eagerly wanting to work as many hours they can ( Saturday and Sunday are a must)! I have found immigration to be the primary reason for Britain leaving the EU, but how would stocks be affected?
    Would they drop considerably due to taxation of trade routes?
    Would they increase due to Britain being a more independent nation and being able to govern its own tax laws?
    Just a thought...
     
  2. GiltEdged

    GiltEdged Active Member

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    There are already multiple tax and trade treaties predating the EU that would apply, and treaties with countries outside it, so there wouldn't be an instant cut off from world trade.

    If Britain stayed, it would be business as usual. If it left, there would probably be an initial fall due to uncertainty, but once the shock was over it would depend on how the trade panned out and how the government handled the exit.

    As far as I can tell, it would depend a lot on the company. While Small businesses might complain about loss of market, microbusinesses, particularly online ones, seem to be in favour of Brexit as the red-tape and VATMOSS (0% Vat threshold on European sales) system currently makes it easier for them to trade outside the EU. Fishing businesses and stocks in the UK may jump, but wheat futures are already falling so the effect on agriculture will depend on whether the government continues subsidies.

    For the larger companies, it depends entirely on what trade deals are struck. One to watch would be the London Stock Exchange, and what effects exit would have on the merger with the German exchange. If there is any risk that Germany would close the LSE on exit, the British parliament would probably block the merger (I am assuming competence).
     
  3. erook7878

    erook7878 Well-Known Member

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    I really have no idea how it will effect the UK's economy. The only thing that I've read about it is that it might effect some of the non-English players in the EPL. IIRC, non-English players would be required to gain a working permit or visa to play in the EPL.
     
  4. crimsonghost747

    crimsonghost747 Senior Investor

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    I do think the EU is good for business mainly due to the free trade, which is not really free but it's certainly a lot easier than when crossing borders outside of the EU area. So I would expect a fall, especially for companies who get a lot of their money from other EU countries. But in the long term it could be good for the UK and their economy.
     
  5. petesede

    petesede Guest

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    There is no way a Brexit would be good for the UK. They would immediately be slapped with tariffs from the UK and USA. As Obama stated, it isn´t really that the USA or EU would add tariffs, it is that there is no legal framework to remove tariffs like we have in most trade deals. New trade deals would have to be negotiated, and in the USA, that is a really hot topic right now.

    I thought Cameron got excellent concessions from the EU already, I try to be open minded by I really see almost no benefit to a Brexit other than emotions. Immigration and Trade the UK got a great deal already.
     
  6. Alex

    Alex Senior Investor

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    The problem is the information given to the 'people' is confusing and to be honest you need degrees in politics and economics to truly understand the information. If (and I hope) the UK does leave, trade will not be effected, but the UK can renegotiate favorable trading tariffs which can work out to be cheaper. Don't forget the VAT will no longer be necessary, so prices will increase, but not as high as the VAT.

    Imagine all the goods will not have VAT included any longer but say 8% tax instead, and that money goes to the UK coffers and not the EU coffers.

    Immigration is an issue because the UK has lost control due to the EU policies, it maybe free movement for all, but how many want to leave the UK and live in Estonia and set up a business and educate their kids there? The renegotiation by Cameron were temporary measures, so that isn't a solution and I wouldn't trust the EU to keep to their word in any case. It is better to invest in a country that has control over its laws and trading regulations. Look at Greece, would you really invest in them when they have zero control?
     
  7. Alex

    Alex Senior Investor

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    You're not from the UK? What you are saying is listening to the scaremongers, and the UK would really be more than fine if it leaves the EU. Cameron got nothing from those talks and anyone who thinks he did really needs a lesson in politics. They were temporary measures and only to be enacted in a few years time, when Cameron has long gone. The Brexit is not emotional; it is a choice between retaining and reclaiming sovereignty laws, or trading that for trade concessions which are never guaranteed. If you look at history, there have been recessions regardless of trade deals, but sovereignty is something that cannot be traded and the laws of the country have been eroded.

    I suggest you do some reading on the impact of EU law and how it has created more issues in domestic law. A Brexit would mean the UK laws will not be bound by the EU courts and laws, and that when there are conflicts in a point of law then the domestic court have a right to address it rather than refer it to a foreign court.
     
  8. petesede

    petesede Guest

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    I definitely agree with the sovereignty issue. It is something that they are fighting right here where I live. The President gave away a big chunk of land to China in exchange for the future building of a new ´panama canal´.

    The trade deals will be worked out in the long term, but there would be an immediate hit and the UK is never going to get as good as deals with their trading partners as they do right now. Especially now because of the political climate in the USA against trade deals.

    On immigration, the UK has gotten by far the most independence for setting their own policy than anyone else in the EU.

    I guess the sovereignty issue is the one I want to understand more. It is great to say ´we want to be sovereign´.. but where are the major things that have happened in the last 10 years where the UK felt like it lost its sovereignty? on what major situation. Like I said, on immigration, you have your own policy in place that won´t change much even if Brexit happens.
     
  9. kgord

    kgord Senior Investor

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    I have heard that the vote favors those who want to stay in the EU. I am curious those of you who are from the UK, what do you think about it? Are you for or against Britian leaving the UK? What are your reasons? It certainly is an interesting topic. It is too bad, you could not leave as "sort of a trial" to see how it would go. However, that would be terribly disconcerting and impractical. If the UK does leave, is there any possibility they could get back in?
     
  10. crimsonghost747

    crimsonghost747 Senior Investor

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    First of all, EU doesn't collect VAT, the governments of the respective countries do. Thus, the income earned from VAT will go to the government, not the EU. Though IIRC the amount of VAT collected is one of the things that is being taken into account when the EU calculates it's membership fees.
    Secondly, the EU requires it's members to have VAT at 15% or more. If UK currently has it at 20%. So you actually have it 5% higher than the EU tells you to.

    I don't think leaving the EU would lower the VAT, a name change might happen but the result for the consumers would be the same.
     

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