Brexit: What Now

The battle was neck to neck with a difference of a million votes which means the country is split right down the middle: for every one voted Leave, there is one voted Remain, well, almost.

The Brexit referendum on 23 June therefore has been most divisive and there is a need for the nation to heal. But this is going to take some work because even the two major political parties are split. The Cameron/Osbourne camp is not happy with the Johnson/Gove camp. The Corbyn camp is not happy with the Hilary Benn camp.

This political mess is the source of the uncertainty over the consequences of the vote to leave the EU. The uncertainty is that no one at the moment is deciding how the UK should leave the EU. The people are uncertain. The businesses are uncertain. The European Parliament is uncertain.

In this uncertainty, the first instinct of the financial markets is to sell. There is no point holding to your portfolio and waiting for the uncertainty to be resolved. It is better to get out and wait. If you want to get out, it is better to be the first the get out than to the last to do so. This is why the financial markets are selling down.

Is Brexit bad for the UK economy?

In the first place, the world economy including the European economy is already in bad shape before the referendum as a result of the consolidation that is taking place in China which some have forecast that it would take five to ten years for the consolidation to be completed and a recovery engineering with a new framework for domestic-oriented growth in China. US is on the verge of a recovery and the Fed has been trying to raise US interest rates and end the quantitative easing which has so far been creating perverse flows in the global economy.

The major perversion of financial flows in the global economy has been the putting of financial resources in the hands of extremists who now have access to heavy weapons. It is this war that is creating the flood of refugees who are fleeing for their lives and in search of greener pastures that is disrupting the peaceful and happy life of the Europeans. The refugees want to enjoy the lifestyle of the English, French and Germans.

Presumably what Brexit will do first is to put a stop to this uncontrolled immigration into the UK, and in its place will be a process of processing and approval. Other thing else will adjust.

Whether Brexit means a complete withdrawal of the UK from the common market is another point to be argued. Nobody wants to do less trade; it will be silly for the EU if it wants to be punitive in the hope of discouraging other EU components to leave.

No doubt there will be investments which would have come into the UK before Brexit and which may want to rethink, mainly because of the uncertainty surrounding the terms of the departure rather than the unhealthiness of the UK economy which probably is no worse than other European economies. Investments that are already in the UK should have no further push to get out.

Certainly, there are many serious to be discuss between the UK and the EU parliament. It will be a long process of at least five years to sought out all the details, although the main details can be framed within two years. This is when political cohesion in the UK politics is crucial.

I expect the financial markets to recover soon after all the sellers who wanted to sell have sold their position. Then they will start looking at the bright side. By then, 18 months ?, Brexit may be a happy word on the lips of ordinary people.

Muhammad Ali

What has a boxer got to do with economics?

Muhammad Ali just died aged 74. He won the heavyweight championship for boxing for three times. He made a lot of money for the boxing industry and the world media. He gave the world enjoyment of his skills and talents, although he and his fellow craftmen and women have had to suffer for their art.

He called himself the greatest. He knew his game and he predicted the outcome. Wouldn't he be entitled to say what he knew without being labeled as boastful. He got to where he was by being himself and on top of that lots of hard work and coaching from his teachers, and be willing to listen to them. He had humbled himself to be taught.

But to the rest of the world, he only wanted us to know that we were not like him. He stood at the apex of his sport, and he bashed everybody down. He had something to show the world what made him different from the rest. It would be incredible that armchair critics knew exactly how he thought in order to be who he had proven himself to be. The only thing that armchair critics could say must be some innocuous remarks which reflected their limited view of life as a non-greatest.

The greatest practitioner of his art is a person who is driven by an inner demon to perfect his art in spite of his own personal imperfection. He sees imperfection in himself, in others and in the world around him. He pushes himself on his lonely journey on the stony road of labour and hope to the summit which no one has any idea what that may be. He stops when his energies fail him and where he has stopped people applaud him for what he has achieved even if that may be the highest point in the world. He has got to the realm of existence where others have no been to before.

To be the greatest is the greatest that anyone can imagine for himself. He has the right to declare that to himself and to the world. The only danger for him is not that he will not push himself further but others will be jealous and will want to stop him from continuing to proclaim himself. The many forms of empowerment that people exert today are nothing but self-proclaimations, and many are high ideals. But to be able to physically demonstrate and establish that superiority of one's own physical and mental prowess and exert it cannot be a wrong or a boast. It is a truth spoken ahead of occurrence.

Muhammad Ali was the greatest, and probably is.