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MoneyWeekBrexit Special: October 2019

The Brexit masterplanHow to protect your wealth amid the political chaos


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Most of the questions surrounding Brexit are quite hard to answer. Is the backstop really so bad? Why can’t we just stick with EFTA? How can you have a border which has none of the normal mechanics of a border? What does Labour leader Jeremy Corbyn actually want? If a majority of MPs really think Boris Johnson is unfit for office, why can’t we have an election? Will we ever actually be allowed to leave the European Union? All tricky stuff.

Good news, then, that there are a couple of questions we can give fairly definitive answers to. Here’s one for you. Is Boris Johnson being controlled by a mysterious cabal of international financiers working to force a no-deal Brexit so that they can make vast profits from shorting the UK’s currency and equity markets? That the answer to this is “yes” is being taken as a given on social media. Even ex-chancellor Philip Hammond seems to give the idea some credence. Johnson, he says, is backed by financiers who “bet billions on a hard Brexit” and are therefore keen on an exit that produces maximum disruption.

Hmmm. The problem with the theory, as the Financial Times points out, is that “it doesn’t make any sense”. The stocks being shorted at the moment mostly have non-Brexit reasons for being shorted (they are over-leveraged or poorly managed in the main). At the same time the timelines are all wrong (no one has the faintest idea when this will all end). And, of course, the whole thing is too complicated. Hedge funds mostly like to bet on things that have a defined range of outcomes. Brexit has dozens of possible outcomes. Let’s say the cabal existed. Let’s say they somehow forced Johnson into a no-deal. It is not a given that the pound would then fall. What if, on 1 November, just as on 1 January 2000, the world did not end? Maybe sterling would bounce. It’s impossible to say. And that makes big bets stupidly risky.

It is easy to see where the impulse to attribute blame in this way comes from. We live, rather as in the 1930s, in an age of anger against big corporations, big banks, and anger with the idea that gangs of crony capitalists are conspiring against the rest of us. There is sense in some of this – finance is too powerful; globalisation has created too many losers in the developed world; and there does need to be a fightback against oligopolistic power.

But extending the knowledge that capitalism isn’t all it could be into the idea that Brexit is somehow being driven by a group of disaster-loving baddies (while comforting for remainers still searching for an explanation as to why anyone would ever disagree with them) is just silly. Monied baddies have better (and easier) things to bet on. The answer to the question, then, is no. Boris Johnson is not being controlled by a mysterious cabal of international financiers. If only other questions on Brexit were so easy to answer.

We have a go at addressing some of them in this special report, compiled from various pieces MoneyWeek staff have written in the past six months on the topic. We’ve looked at the impact of Brexit both on the UK, and in the latter half of the report, on the eurozone. But with the landscape ever changing, make sure you keep up to date by reading the magazine, and signing up to our daily email, Money Morning, at moneyweek.com/money-morning-signup.

“Is a mysterious cabal of financiers forcing Boris Johnson into a hard Brexit? Eh, no”

Sorry – there is no Brexit conspiracy

Boris Johnson: some Brexit questions are harder than others

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Merryn Somerset WebbEditor-in-chief


Where do you stand on the latest Brexit developments? Shaking your fist at the TV

in outrage, or swooning with admiration at the audacity of our prime minister? As some have jokingly observed, with breathtaking twists and a cast of extraordinary characters, it’s like a reality television show. And, like a reality show, eventually you will have to cast your vote on the winner, leading to eviction for the unloved.

On Boris Johnson’s Brexit Love Island there is a twist, however. The director of the show is one of the players. Johnson is pulling the strings to gain the result he wants. The stars of the show might all be real people in real situations, but their portrayal is confected. Johnson needs you to think that he – and only he – is on the side of the 52% who voted to leave the European Union three years ago.

So far, his plan is working. With Johnson pivoting towards a departure, Deal-or-No-Deal, he has stolen half the Brexit Party’s vote and put the Tories in the lead. But that’s not enough. The opposition must be exposed as the enemy of the 52%. That’s why every move now is designed to antagonise Remainers and force them to reveal their dastardly plans to stop Brexit. Then Johnson can emerge as “The Hero Of The People”, standing up for them against institutions that seek to frustrate their will.

Boris Johnson’s playbookThe weaker Johnson looks now, the more he becomes the lone battler against parliamentary bullying later. Not only, he will argue, has Parliament bound the hands of the executive, but they failed to bring a confidence vote that would remove that executive when they had the opportunity. They even deprived the people of having their say, by refusing to hold a general election, twice. The cowardice! The bare-faced cheek! The failure to respect democracy!

Rather than delivering this message by text (as the Love Islanders prefer), it will be played out in the courts. Constitutional niceties will be bandied about with aplomb. Wasn’t Speaker John Bercow breaking precedent by allowing Standing Order Number 24 to lead to a binding motion on the government? Didn’t his ruling on Queen’s Consent constitute overreach?

Remember the Gina Miller court case three years ago, which allowed Parliament a vote to trigger Article 50 in the first place? A Daily Mail front page printed pictures of the three judges who presided over the ruling, with the simple headline: “Enemies Of The People”. Expect more of this.

From Bercow, to the Opposition, to the 21 rebels within the government’s own party: each must be shown to play their part in frustrating the Brexit vote. In the weeks to come, expect the judiciary and the EU to join their place in Brexit Love Island’s Gallery of Villains.

The truth is that nothing can stop Johnson from delivering a “no deal” Brexit if he is hell-bent on doing so. And the truth is that he must deliver a “no deal” Brexit in order to win the next election. To avoid any blame in the pursuit of that goal, he must be pushed

into it, first by Parliament, then by the EU. That’s why the current turmoil suits him – the more snookered he looks now, the more he can argue that the behaviour of others has forced him into extreme action.

An inconvenient truthAnd the other inconvenient truth is that all the other characters want him to win this reality TV show. If the Conservatives deliver a “no-deal” Brexit, then Labour never has to face the truth of its incoherent Brexit policy, and it can pin the blame on the Tories. The Lib Dems can sweep up Remainers by campaigning to go back into the EU. The SNP can blame a chaotic Westminster government to demand independence.

More than anything else, for all the talk of cross-party compromise, this is why a deal will remain out of reach. Our MP-by-MP analysis shows that there isn’t a majority in Parliament for anything, much as they all like to protest against something.

If the deal sells out Northern Ireland, that loses the DUP and the Spartan eurosceptics in the European Research Group. On the other side, Remainer MPs sense that revoking Article 50 is now in sight, with this becoming Lib Dem policy. The ideological extremes have become entrenched. And in the middle, there is still the divide of party loyalty.

The next election will be fought as “The People versus The Establishment”. Each character is now playing their part. Just as reality TV ends up with the characters doing unimaginable things, so we will see with British politics until – as in the final stages of any reality TV show – voters’ choices are narrowed down to two extremes. Soon it will become clear that in this case, the series finale will be “No Deal” versus “Jeremy Corbyn”. Neither of which, I believe, would be positive for UK assets.

For more from Helen, visit blondemoney.co.uk.

Welcome to Boris’ Brexit Love Island

“The inconvenient truth is that all the other parties want Johnson to win”

The latest twists and turns in Parliament might look anarchic, but it’s all running to a carefully scripted storyline

Love Islanders: better-looking than MPs

Helen ThomasPolitical analyst, Blonde Money

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The UK’s turbulent political situation presents a dilemma for investors. British assets look cheap, but what happens if we get an extreme outcome? John Stepek looks at how bad things could get

What’s worse – no-deal Brexit or a Corbyn government?

By the time you read this sentence, the chances are the political situation in the UK will have

undergone several new last-minute reversals, generating acres of newsprint and screen rants in the process. If the last few weeks have made anything clear, it’s that no one can be certain of anything.

Of course, any sensible long-term investor already knows that. You can’t time the market. Instead, you have to focus on ensuring your portfolio (and your lifestyle generally) can withstand whatever the world is likely to throw at it. The goal is not to predict the future – it’s to be prepared for it when it comes. As Helen Thomas of Blonde Money argued earlier on in this report, there’s a good chance that the future for those of us based in Britain contains either a “no-deal” Brexit, or a Jeremy Corbyn government (or – less likely perhaps, but still possible – both). So what’s likely to happen in each case?

A Jeremy Corbyn government“Why should democracy end when you walk into work? Why should the place where you spend most of your day sometimes feel like a dictatorship?” That was Labour leader Jeremy Corbyn speaking to the Trades Union Congress in September about his plans to reverse the “deliberate, decades-long transfer of power from working people”, with the creation of a new government “Worker Protection Agency” alongside the repeal of various bits of legislation restricting the power of unions to strike without the clear support of a majority of their members.

Now, you may well agree with MoneyWeek that egregious executive pay needs to be tackled (it’s an issue we’ve been banging on about for years now, as regular readers will know). You may also think that real wage growth has been inadequate, and that the share of the pie going to capital rather than to labour is unsustainable (we do). However, these are not the words of a man who believes that private enterprise has much of a positive role to play in the economy – and the policies of any Labour government led by Corbyn would very much reflect this view.

In this light, Citigroup and Deutsche Bank, just two of the global investment banks who are trying to make peace with the idea of a Corbyn government – seeing it as a better bet than a no-deal Brexit – appear to be suffering a failure of imagination. No-deal Brexit might seem like an extreme outcome to multinationals who have grown used to working with a supranational organisation that is very good at protecting big companies from new competitors, but Corbyn and Labour’s shadow chancellor, John McDonnell, have laid out a set of plans that are by any objective standard highly radical compared with the economic approach that Britain has grown used to over the past 35 years or so. As economist Julian Jessop puts it in The Daily Telegraph, “Labour is planning to tear up the rules of a liberal, free market economy”.

That’s not scaremongering. McDonnell himself

says: “We have to rewrite the rules of our economy”. Even under Labour’s current plans (never mind anything they might propose if they come to power), property rights – the foundation stone of any functioning free-market economy – are under assault. There’s the plan to renationalise industries from utilities to railways to postal services, without paying the market price for them. There’s the plan to force companies to give 10% of their shares to staff. There’s also the suggestion, raised by McDonnell in a Financial Times interview, that private tenants would be given a “right-to-buy” – the implication being that tenants could force their landlords to sell their rented property to them at a government-determined price.

Even if you have sympathy for the politics behind all this, the practical problems are breathtaking and the unintended side-effects will almost certainly damage investment and economic growth within a very short space of time. If property of all kinds is up for grabs at the whim of the government, then no one will invest here. And this is before we consider issues such as the impact of a financial transactions tax on investing and the City, for example, or the risk of capital controls being imposed to prevent capital flight.

So a Corbyn-led Labour government would be bad news for investors and it is hard to think of an obvious

Is he really a better option than leaving?

“These are not the words of a man who feels that private enterprise is a good thing”

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upside. As the FT puts it, “at the heart of everything is one word: redistribution”. As a minimum, on a personal finance level, you would have to expect new and higher taxes, while more government intervention in the economy is likely to hit corporate profitability (and thus share prices), particularly of domestic companies less able to make money offshore.

A no-deal BrexitSo what of a no-deal Brexit? Deutsche’s Oliver Harvey reckons that a Corbyn government might be less bad than no deal because it would be temporary, whereas Brexit is permanent. We’re not sure we’d agree with that. Remember that “no deal”, by definition, has to be temporary – it’s just a step on the road to “some sort of deal”. Indeed, even if we’d left (or do leave) under Theresa May’s Withdrawal Agreement, we’d still have to discuss trade terms. A Corbyn government – even a short-lived one – which managed to push through confiscatory policies such as renationalisation would surely damage investors’ confidence in the UK permanently (or at least for a very long time indeed).

As for the consequences of no deal, there’s no denying that in the short term we might see disruption (if indeed we were to leave after October 31st). However, it is interesting that even a think tank like The UK in a Changing Europe, which is by no means pro-Brexit (it believes “no deal” will lead to “prolonged and severe political and economic uncertainty”) pointed out in a report in September that “disruption on day one may not be as immediate and visible as earlier reports have predicted. Business, and government, have put in

place contingency plans to mitigate the worst effects”. While the most obvious immediate impact would be on trade, some of this would be “minimised by stockpiling, business anticipation and a public holiday in the EU 27”. By the start of November, even the damage to the pound “may already have been ‘priced in’… The financial system overall will remain stable”.

Similarly, the Bank of England downgraded its (still hugely gloomy) forecast for no deal, due to preparations made so far. Bank governor Mark Carney recently told MPs that “real progress” had been made. And somewhat ironically, Citigroup’s own European chief executive David Livingstone tells The Daily Telegraph’s Ben Wright that “we are already operating on a ‘post-Brexit’ basis” and that “the City will still be hugely important... the UK will have less access to Europe, but it still has good access to the rest of the world, and crucially, to capital”.

The long-term effects remain to be seen. We will almost certainly be negotiating some of the more detailed points for years to come, and the next recession – regardless of when it arrives – will almost certainly be blamed on Brexit whatever happens. But in all, it’s a far cry from planes being grounded (they won’t be), or unmoored derivatives contracts blowing up the financial system (that’s been tackled because it would have been a disaster for all involved). In short, we suspect that no-deal Brexit would result in less uncertainty, after the initial shock, whereas a Corbyn government could lead to a lot more. See the box, and the pages that follow, for more on what investors might do to mitigate all this.

How to boost your portfolio’s resilienceInvestors in the UK are facing turbulence ahead regardless of the political outcome, and this is all happening at a time when the world is in a precarious and unusual economic state. That’s why diversification (more on that further down) matters.

However, as we also note later in this report, UK equities do look cheap, with high dividend yields. As a result, a no-deal Brexit wouldn’t overly concern us – current valuations represent a decent buffer. But a Corbyn government is a tougher call – one that involves being pickier about your investments.

Is a Corbyn government likely to

inflict much damage on the resources sector? Probably not – the mines are mostly overseas and industrial companies are largely viewed benignly. But are utilities currently cheap enough, given the risks of nationalisation? It’s also hard to see the high-street banks escaping unscathed, although the question there is more nuanced (bans on bonuses might also mean lower wage bills, by no means bad news for shareholders).

In all, we’d suggest building a watchlist of funds or stocks you’d like to buy. Then ensure you have cash available to buy into UK opportunities as and when they look attractive, or

there is a little more clarity on the current political situation.

We’ve also been saying you should own some gold for a long time now. As a sterling investor, do be aware that if the pound strengthens (which is possible, given that it’s currently near 30-year lows), then gold’s sterling value may decline. We still think you should own it as insurance – but just be aware of this.

You can get exposure to gold via your stockbroker account using a physically-backed exchange-traded product. ETFS Physical Gold (LSE: PHGP) is one option; The Royal Mint is planning to launch its own gold-backed ETF shortly.

“Even a ‘no-deal’ Brexit can only ever be a step along the road to ‘some sort of deal’”

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The UK stockmarket accounts for less than 5% of shares listed around the world, yet the London-

listed stocks still dominate most British investors’ portfolios. The typical wealth manager keeps around half their clients’ equity holdings in the UK, while smaller investors are likely to show an even greater home bias.

The standard argument for investing abroad is to broaden your opportunities. Why limit yourself to investing in the tiny universe of major British tech companies, for example, when you could buy Apple, Alphabet or Microsoft in the US? However, for many investors, that justification isn’t especially compelling. The UK market has enough opportunities, as far as they are concerned, that the higher costs and additional complexity of dealing overseas doesn’t seem worthwhile.

In reality, the idea that buying foreign shares is still a major hassle is misleading: most low-cost stockbrokers offer access to major US and European stocks at the very least. But it’s still pretty understandable why many investors would rather stick to what they know. It’s certainly possible to build a diversified portfolio of 20 high-quality companies that you’re already familiar with just by investing in the UK market, so expending any extra effort to research international stocks may seem entirely unnecessary.

However, there’s one type of risk that it’s hard to avoid with a UK-focused portfolio – those economic and political threats that are unique to the British economy. Recent wobbles in sterling are a small-scale demonstration of this: the pound is worth quite a few percent less against the euro or the dollar than it was earlier this year, as many holidaymakers will soon be noticing. And the wider trend in markets over the past three years shows clearly how an investor who only buys British is becoming poorer in global terms, often without realising it.

The MSCI UK index has returned around 10.5% per year (including dividends) over the past three years, which is worse than Europe (13%) and the US (17%) in

sterling terms. And many of the larger UK companies that make up this index get most of their profits from overseas, which means that their shares tend to rise when sterling falls. The MSCI UK Mid Cap index, where overseas earnings are lower, has returned under 8% per year.

With no certainty about what will happen on Brexit day on 31 October, the simplest way to protect your wealth is to make sure that it’s diversified around the world. That could mean investing directly in overseas shares, but favouring UK firms that do most of their business around the world or holding international funds is another simple option.

Why it pays to invest abroad

“An investor who only buys British is poorer in global terms”

Many investors feel safer investing at home – but as the wobbly pound shows, that safety can be an illusion

I wish I knew what diversification was, but I’m too embarrassed to askDiversification is the process of dividing your wealth between different investments to avoid being too reliant on any single one doing well. In plain English, it’s all about making sure you don’t keep all your eggs in one basket. The purpose of diversification is to reduce both your day-to-day risk (as measured by the volatility of your portfolio) and your potential for suffering uncommon but catastrophic losses, while maintaining a decent level of return.

For example, if you own just

one stock, then your portfolio is entirely dependent on the fortunes of that one company. If you own 15, then even if one or two perform badly, or go bust, then the others in your portfolio should help to compensate for the loss.

While there’s no ideal level of shares to hold, some research suggests that once you get above 20 well-selected shares, the marginal benefits of adding more is small. However, this assumes the shares are themselves well diversified – if you hold just 20

oil companies, for example, you are still heavily exposed to the risks of a single sector. In addition, the size of each investment is important: if you have 100 shares, but half your portfolio in a single stock, you are not sensibly diversified.

A good diversification strategy combines all these principles: you might set yourself a rule of holding 20 stocks, with no more than two in each sector and no more than 10% of your portfolio in a single stock (and no more than 20% in three and so on).

As well as diversification within an asset class, you should diversify between asset classes, because different assets tend to behave in different ways depending on the economic backdrop.

For example, bonds will do well during periods of falling or low inflation, while gold tends to benefit during periods of financial instability. Your exact mix of assets – or asset allocation – will depend on your investment time horizon (the point at which you’ll need the money) and risk appetite.

Avoiding “home bias” can pay off

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Cris Sholto HeatonInvestment columnist


With $17trn-odd worth of bonds sporting negative yields and the US stockmarket trading

at valuations not seen except at the peak of the tech bubble, it’s easy to assume that “everything is expensive”. And yet, that’s not strictly true. The gap between US stocks and the rest of the world is striking. American equities have massively outperformed both their developed world peers and emerging markets during the post-2009 equity rally. As a result, as Michael Mackenzie points out in the Financial Times, “a comparison of US and global equities through their dividend yields and price-to-earnings ratios bolsters the case for a reversal over the coming years that favours emerging markets and other developed world equities”.

The first question most of us will ask in response to that, of course, is: when will the turnaround happen? Yet that’s a mistake. No one can time the market, but we can get a decent idea of what our long-term returns might be. As The Economist’s Buttonwood column points out, “Discount Rates”, a 2011 paper by John Cochrane of Chicago Booth School of Business noted that income yields (whether on bonds or on equities) are a good guide to future returns. “High prices, relative to dividends, have reliably preceded many years of poor returns. Low prices have preceded high returns.” That’s because asset prices are driven more by risk appetite than by investors’ earnings expectations. In other words, investors don’t buy expensive stocks because they think their earnings will rocket – they buy because they feel more comfortable investing in popular stocks than in hated ones.

So where are dividend yields unusually high right now? Look no further than the UK, where the dividend yield on the FTSE 100 is standing well above the 30-year average of 3.5%. Obviously, there’s no guarantee that just because it’s cheap the UK market is likely to turn around soon – as Buttonwood notes, “the signal from yield is too weak to be relied upon to catch turning points profitably”. But in the meantime, you’re getting paid to wait.

The Temple Bar Investment Trust (LSE: TMPL) has increased its dividend every year for the last 35 years. As of early October, it offers a yield of just under 4% and trades on a discount to net asset value (NAV – the value of the underlying portfolio) of 5%. The top holding is pharma giant GlaxoSmithKline, with oil majors BP and Shell also ranking highly. Another option is Shires Income (LSE: SHRS), with a yield of around 5.1% and a discount of 2%. Alternatively you could go for a simple passive fund that tracks the underlying market, such as the HSBC FTSE All Share Index fund, which charges less than 0.1% a year.

Why you should monitor dividend yields

“Investors like to buy what’s popular, rather than what is hated”

No valuation measure can help you to time the market. But for long-term investors, that shouldn’t matter

Shell is just one high-yielding FTSE 100 stock

John StepekExecutive editor

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The malaise affecting domestically orientated UK stocks has hit the property sector hard. While

the All Share index returned 1% over one year to the end of July and 27% over three, the FTSE Real Estate sector’s returns were –10.6% and 4.5% respectively. Some of this reflects the well-known problems of the retail sector; historic overexpansion, excessive rents, business rates, online competition, and the use of creditor voluntary arrangements (CVAs) by distressed retailers to cut their rental costs and break contracts. However, says Marcus Phayre-Mudge, manager of TR Property Investment Trust (LSE: TRY), share prices have recently been hit “by an additional level of Brexit risk”, especially as “the market has finally woken up to the real possibility of no-deal”.

It’s not as bad as it looksYet, notes Phayre-Mudge, “there have been no areas of oversupply for commercial property. Investment volumes in the City are at ten-year highs, with the occupational market, especially the technology and media sectors, happy to pay up for quality office space”. London office rents overall are falling, but this could be temporary as investment decisions are postponed. “Meanwhile, we are utterly confident of the industrial, logistics, healthcare, student accommodation and self-storage sectors.”

In the year to end-August, TR’s portfolio returned 4.3%; and 30% over three. Much of this is due to 62% of the fund being invested in Europe and only 38% in the UK (of which 7% is in directly held property). European stocks have returned 60% in sterling in the last three years, helped by steady growth and low interest rates. Employment growth is pushing up office rentals in all major European cities by “high single-digit percentages”, while only 10% of retail sales in Europe are online compared with 20% in the UK. Retail rents are also lower, so property values have held up much better. The German housing market has been hit by a rent freeze proposed by the Berlin state government, but “there is very little contagion to the rest of Germany”. Phayre-Mudge also thinks the

proposal may be overruled as unconstitutional and that it is discounted in any case in the share prices of his favoured stocks, LEG Immobilien (Xetra: LEG) and Vonovia (Xetra: VNA). Meanwhile, low rates in both the UK and Europe have “been a positive factor overall”. He remains confident on the outlook; in the UK, “the market has detached itself from a rational valuation and it looks hard for share prices... to drop further, even if the physical market gets worse”. Shares in the trust trade just below net asset value (NAV – the value of the underlying portfolio), yield more than 3%, and look an excellent long-term core holding, with a built-in hedge against lower sterling, both from its European investments and from the benefit to UK firms – especially in London – from a weaker currency.

Bag a Brexit bargain

“The market has detached itself from rational valuation”

UK commercial property stocks look unreasonably cheap, says Max King

UK property stocks have been hit too hard

Max KingInvestment columnist

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Dominic Cummings, the architect of the Vote Leave campaign, is now in Downing Street and advising Boris Johnson. That has Remainers panicking. Why so fearful? Jane Lewis reports

The brain behind Boris’s Brexit

When Boris Johnson took over as prime minister, one new addition to his team above all stood

out, says John McTernan in the FT: Dominic Cummings, appointed a senior adviser in No. 10. Once dubbed a “career psychopath” by former PM David Cameron, the architect of Vote Leave instills unease like none other. “I’m deeply disturbed by this development. Scared even,” wrote the Lib Dem MP Layla Moran in the New Statesman. It now “looks like the forces of evil have their hands firmly gripped on the levers of power”.

The Brexit guerillaFew will have been as pleased by this “anguished reaction” as the gap-toothed “Brexit guerilla” himself, says The Times. As one of his friends observes, “it’s not unhelpful if people think you’re an evil genius” – particularly given the central task of delivering Brexit. “What makes Cummings so mesmerising for many, and terrifying for some”, is that he knows what he wants to do, and does it only on his terms, said McTernan. “He won’t compromise, he will achieve his ambitions by any means necessary” – using an armoury of lethally targeted verbal barbs to take opponents down. He doesn’t stand for any fixed interest group, once remarking that he sees political parties as no more than “vehicles of convenience”.

Memorably portrayed by Benedict Cumberbatch in the Channel 4 drama Brexit: The Uncivil War, Cummings is all the more effective because he’s not interested in “glory or status”, politics professor Tim Bale told The Guardian. He’s in the game to “improve society”. Brexit is just the means of achieving that end. Having long been scathing of the social and economic status quo in the UK, Cummings has “latched on” to Brexit as a way of upending established structures that have left so many Britons “behind”, argues the BBC’s Alex Forsyth.

Cummings, 47, certainly doesn’t hail from any gilded “patrician circle”, says Andrew Gimson on Conservative Home. Born in Durham, the son of an oil-rig project manager and a special needs teacher, he attended a state primary, followed by the private Durham School – graduating with a first in history from Oxford in 1994. He then spent three years in Russia attempting to set up an airline, before retreating when “the KGB issued threats”.

A crusade against the blobOn his return to Britain, Cummings cut his political teeth as campaign director of Business for Sterling, succeeding in scuppering Tony Blair’s “flirtation

with the euro” in 1999. That was a clear forerunner to his devastatingly effective Leave campaign. Later headhunted to become director of strategy during Iain Duncan Smith’s short-lived Tory leadership, Cummings found his feet when he became chief of staff to the then education secretary, Michael Gove, in 2010. His crusade against the mandarins in that department (whom he referred to as “the blob”) set the tone for his later vitriolic attacks on the civil service. Cummings sees the reform of Whitehall as crucial to making the most of the opportunities presented by Brexit – telling The Economist that a key role Britain might assume, were it to rid itself of bureaucratic shackles, is to become a world leader in science and technology.

Some reckon that, for all his success as a disruptor, Cummings is “an overrated political operator”, says The Guardian. As one of his opponents sharply observed in Brexit: The Uncivil War: “He’s not the Messiah. He’s a very naughty f**king a***hole.” Time will tell on that score.

“He won’t compro-mise, he will achieve his ambitions by any means necessary – using an armoury of lethally tar-geted verbal barbs”

Cummings: “career psychopath”

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How Brexit will save the United Kingdom

Leaving the EU should strengthen Britain – a multinational union Europe can only aspire to. Alex Carew, a London-based fund manager and economic historian, explains how

It’s on the rocks. Again. Like all marriages, the union between Scotland and England has had its ups and

downs. Along with Northern Ireland, Scotland voted to Remain in the 2016 referendum on our membership of the European Union; England and Wales voted to Leave. Brexit is a lever Nicola Sturgeon and the Scottish National Party hope will prise Scotland out of the UK. The current chaos at Westminster isn’t exactly an inducement to stay. Who wouldn’t want a divorce from our political establishment?

Present political anarchy aside, however, Brexit could be just the aphrodisiac Scotland and England’s marriage could use – and not just because Brexit is a sobering reminder of the often appalling costs of divorce. After all, if you think that leaving the European Union after 40-plus years of membership has been bitter and damaging, imagine dissolving a far more complex, centuries-old marriage. Irish border problem? I’ll raise you a hard border across Great Britain and breaking up a currency union. Nor is it that Scottish independence outside the EU’s increasingly harmonised structures would be a considerably less practical undertaking, as the UK and Scotland wouldn’t automatically operate with the same rules. Instead, all of us who believe in the United Kingdom should use Brexit as an opportunity to focus on what makes multinational unions work – because doing so highlights just how remarkable the UK actually is.

What makes a successful multinational union?Here are some key ingredients for a successful, sovereign multinational union: an effective single currency covering a highly integrated economic area, along with fiscal risk-sharing and wealth redistribution across that area (such as the Barnett formula governing public spending in Scotland, Wales and Northern Ireland). A comprehensive single market in goods and services is also necessary. Then you need a single, risk-free sovereign debt market; a banking union; a united foreign, security and defence policy; deep cultural and family ties; shared values; unlimited, uncontentious free movement of people; representative institutions with real power and (usually) popular legitimacy; a shared head of state; and similar legal traditions. A shared mother tongue is useful, too.

Tennis legend Roger Federer makes winning Grand Slams look so relaxed, it’s easy to forget the experience, training and skill required. Similarly, the UK makes being a multinational union look almost effortless. We certainly have our problems, not least the lopsided constitutional settlement bequeathed by New Labour in the late 1990s. But it is worth appreciating that the UK’s areas of greatest strength are often those of existential peril for the EU.

Why the eurozone isn’t oneTake the eurozone. Lacking a shared sovereign debt instrument and the substantial budget and fiscal

transfers required for long-term survival, the single currency remains perilously exposed to future economic and market shocks. How about freedom of movement? Hardly uncontentious across the bloc. Or the varied and frequently contradictory foreign-policy objectives of diverse member states? Regrettably, the list goes on.

By contrast, Scotland would be leaving a union that “has it all”. The United Kingdom has withstood all that history can throw at it. Within it Scotland not only has a seat at every top table, but it also wields outsize influence. Scotland has produced six of the 23 individual British prime ministers since 1900. Not bad for a nation with about 8% of the population. And it’s a Scot we have to thank for saving us from the euro: take a bow, Gordon Brown. Will Scotland produce a quarter of the EU’s top brass, where its population and economy would simply be a rounding error?

Swapping a solid union for a flimsy oneSNP policy is to ditch this trusted familial relationship

“We have a Scot to thank for saving us from the euro: take a bow, Gordon Brown”

11

Sunshine on Edinburgh Castle


in favour of what even the most ardent federalist will admit is a structurally flawed union struggling to replicate… the UK. And Scotland would have negligible influence to boot.

As the Remain operation found out to its cost, however, campaigns overly focused on practicalities struggle to gain traction in a post-technocratic era that craves narrative. Human beings are not simply sentient econometric calculators. We prize identity, family, roots, values and purpose. The desiccated, post-Cold War liberal order has little to offer here beyond the culture of the atomised self, and is consequently everywhere in retreat.

Predicting the UK’s dissolution, a Financial Times columnist recently opined that “Britishness is an invented identity”. My own Anglo-Scottish family suggests otherwise. My grandfather and his forebears hailed from Glasgow and the West Coast. They fought and lived under the Union flag, and were no less Scottish for it. My surname is originally Welsh, via Ireland and the West Country. Like millions of other Britons, I am a product of all the home nations; avowedly not ethno-nationalist, and distinctly British, thank you very much. It is this marriage of family, friendship, practicality, sacrifice and values that should leave the UK well placed to survive the 21st century’s identitarian onslaught.

The Reformation: the first BrexitWhat of those values? “Protestantism was the foundation that made the invention of Great Britain possible,” noted historian Linda Colley. When Elizabeth I died childless in 1603, it was her cousin and fellow Protestant, James VI of Scotland, who acceded to the English throne as James I. This we can consider Union 1.0, or the “personal union”, founded in a shared rejection of restrictive continental orthodoxies and remote, unaccountable power. Sound familiar? One regal head wore two separate crowns. It took another century and several failed attempts to bring about a formal parliamentary merger with the Acts of Union in 1706/1707, or Union 2.0. Peace and strategic security succeeded war and uneasy co-existence. United, Scotland and England were free to focus their energies – commercial, political, military – outward, rather than inward. And united, of course, is what the EU would love to be – yet its inherent structural flaws will continue to frustrate this ambition.

Take back control… then give it to Europe?The present tide of anti-establishment politics sweeping the West has much in common with the Reformation 500 years ago. Substitute “internet” for “printing

press” and “EU” for “Catholic Church” and you get the picture. This analogy also applies because, as Professor Brendan Simms of the University of Cambridge points out, whatever your views on the decision itself, asking Theresa May and the civil service to carry out Brexit is like asking the cardinals to carry out the Reformation. Unsurprisingly, it’s an unholy mess.

More fundamentally, the comparison is resonant because Scotland and the other British home nations share a deep tradition of freedom and a mistrust of remote, centralised, unaccountable power. This is, after all, the core of the SNP’s message. Take back control (but then give it away to the EU). It’s also the message of Brexit, which the SNP of all people should have seen coming. The strong Yes/Leave showing in the 2014 independence referendum for what had hitherto been a minority pursuit was the canary in the populist coalmine, driven by a sense of alienation from an increasingly remote technocratic elite.

A tonic for the UKSo Brexit’s a potential tonic for the United Kingdom in at least three respects. Firstly, for all its imperfections, the UK has long been the flagship multinational sovereign union that the EU aspires to be. Whatever one’s views on Brexit, the EU’s continuing struggle to create something similar should make us grateful for what the UK already is, and to make the case for it with renewed energy. Secondly, divorces are brutal and are not to be undertaken lightly. That’s doubly true when, behind the noise, the fundamentals of the marriage remain strong. And triply true when the divisions over key questions are narrow (both referendum results were very close).

Finally, the original Reformation made the UK possible. Britons on both sides of the border share similar values: SNP supporters and Brexiteers have more in common than either might care to admit. With the right leadership, the new Reformation spirit can re-energise the Union for the 21st century with a narrative that appeals to Brexiteers, Scottish nationalists and Remainers too. Take back control from remote, unaccountable authority. Refocus on the things that really matter: family, community, way of life and shared values. Where power does not need to be wielded centrally, push it down. In an era of vicious identity politics and resurgent ethno-nationalism, the multinational concept of Britishness is more valuable than ever before. And as the moving scenes in Hong Kong remind us – where pro-democracy protesters wave the Union flag as a symbol of freedom and defiance – the rest of the world knows what the Union stands for. It’s time we remembered too.

“The rest of the world knows what the union stands for. It’s time we remembered too”

12


September saw European Central Bank (ECB) governor Mario Draghi’s penultimate monetary

policy meeting before he hands over to Christine Lagarde (formerly at the International Monetary Fund). Markets had hoped for fireworks from the man widely viewed as having “saved the eurozone” at the height of the sovereign debt crisis in 2012. So did he deliver? As expected, Draghi cut interest rates from –0.4% to –0.5%. He also restarted quantitative easing (QE). The ECB will buy €20bn of eurozone sovereign bonds every month, with no end date – the purchases will continue until the ECB is ready to raise interest rates again, which may be a while.

The market and press reaction was muted. In the Financial Times, Laurence Fletcher reported “a growing acceptance that monetary policy has reached its limits.” And the sense that resistance is growing to easy monetary policy wasn’t helped by a front page on German newspaper Bild, accusing “Count Draghila” of sucking savers dry.

Yet Draghi may have achieved more than we think. Firstly, notes Eric Lonergan of M&G on his Philosophy of Money blog, the ECB didn’t just cut rates and reactivate QE. It will also allow commercial banks to deposit more of their reserves with it at 0%, rather than charging them –0.5%. Why does this matter? It means banks can borrow funds at negative rates from other banks with excess reserves, and then deposit these with the ECB at 0%. That means they make a risk-free profit (and this comes on top of the TLTRO scheme – see below – which allows banks to borrow at as little as –0.5% to lend to the “real” economy). As far as Lonergan is concerned, “if legal, the limits to monetary policy have just been lifted... official interest rates are now having the net effect of transfers to the private sector.” If so, the implication is that fears that eurozone banks will collapse are overblown, removing a key source of the market’s current deflationary angst.

Secondly, as Cedric Gemehl of Gavekal notes, under “QE Infinity”, the ECB will buy more sovereign

debt than eurozone governments plan to issue next year, while keeping interest rates nailed down. That means all eurozone countries will be free to spend more money without breaking the European Union’s fiscal rules. In other words, Draghi has made it as easy as he possibly can for eurozone governments to turn to fiscal policy, a line that Lagarde is also certain to push.

I’m not sure I’d buy eurozone banks yet. But if Draghi has put a floor under the sector, and given governments free rein to spend, it’s another sign that markets are betting on deflation too aggressively – and not paying enough attention to the risk of inflation.

How Draghi saved the euro

“The limits to monetary policy have just been lifted”

The European Central Bank boss steps down shortly. What has he achieved with his parting shot?

I wish I knew what a TLTRO was, but I’m too embarrassed to askTargeted Longer-Term Refinancing Operations (TLTRO) are one of the “unconventional” monetary policy tools used by the European Central Bank (ECB). The ECB agrees to lend money to commercial banks over a set period at a very low rate, on condition that they lend this money out into the “real” economy (by making loans to businesses, for example).

The point is to give banks a cheap source of funding that they are encouraged to lend out, in order both to raise bank

profit margins and to boost economic activity and growth.

The first tranche of TLTRO loans was launched in June 2014, with a second batch following in March 2016. The third tranche was launched in June this year, and began in September.

Initially the plan was that banks would be allowed to take out a two-year loan, at a rate based on the ECB’s average rate plus 0.1% (with the loan getting cheaper, the more the bank lends out).

However, the rate on the

loans was lowered this month as the ECB’s views on future growth deteriorated (thus justifying a move to even looser monetary policy).

Meanwhile, the loan period was lengthened to three years, with a repayment option at two years. In other words, the banks will be able to access funds at a lower rate, and for a longer period of time, than before, which should boost the profitability of any loans the banks make.

Indeed, as strategist Tom Kinmouth of ABN Amro put it,

the move resulted in banks benefiting from terms that were “considerably better” than previously planned – “they can now borrow from the ECB... as low as –0.5%”. In other words, “the ECB will pay banks to take money.”

Of course, making money available to banks to lend is a very different matter to finding businesses and individuals who are keen to borrow the money. Some argue that cheap funds haven’t driven growth higher because central banks are now “pushing on a string.”

European Central Bank head Mario Draghi

John StepekExecutive editor

13


Deutsche Bank has been staggering from crisis to crisis for years now. Its shares have fallen

hard from their pre-crash peak, and what was once Europe’s mightiest financial institution is now a shadow of its former self. With 8,000 staff in London, it was one of the largest employers in the City, and it was a mark of the British capital’s dominance of European markets that the German giant chose to run its trading operations from here rather than Frankfurt. Many of those jobs were eliminated in a restructuring earlier this year, and it is possible that many more will be lost in the next few months.

By itself that might not matter so much. Investment banking is a cyclical, turbulent industry. But there is also a deeper theme here. It is not just Deutsche that is in trouble. Most of the major European finance houses are in retreat. BNP Paribas, its only real equal inside the eurozone, has been struggling this year because of losses in its trading division. Credit Suisse has been hit by trading losses, and has spent years reducing its reliance on investment banking. UBS has been cutting jobs in investment banking, and so has France’s Société Générale; Germany’s Commerzbank has too many problems of its own to do anything other than retrench. There is not a single European bank that is expanding.

There are reasons for that. The eurozone has been stagnant for years, and that is being reflected in the strength of its banks. They are not so important any more because their domestic economies are not very strong. The imbalances that are endemic within the single currency zone mean that huge sums have to be recycled through the banking system and that has created vast potential losses. And the negative interest rates the European Central Bank has imposed have wiped out bank profits by making it virtually impossible to earn any sort of margin on deposits or loans. Europe has crippled its banking sector and it is unlikely to recover anytime soon.

That matters for the City. Over the last 30 years London has turned itself into Europe’s main financial hub. A deep talent pool, access to global markets, a stable legal system and membership of the EU’s single market meant it was the easiest place for European companies to raise capital and for investors to trade shares, bonds and debt. London accounted for the vast bulk of Europe’s equity trading, its derivatives market, its foreign-exchange business, its hedge funds and its bond issues. That was great while it lasted, and it was one of the key reasons the City flourished. Europe could use it to access the world, and the world could use it to access Europe. True, it meant complying with

the EU’s often meddlesome rules on finance. But that was a price worth paying.

A changing equationThe trouble is, most of Europe’s financial sector is now in full-scale retreat. That changes the equation. It was worth complying with the EU’s rules if it meant Deutsche employed 8,000 highly paid staff in London and generated lots of tax revenues. For 1,000 staff, or even 500? Not so much. The City has been fretting for the last three years about losing access to the European market if we see a no-deal Brexit. But the EU’s banks have already been leaving Britain – because it doesn’t have a sustainable business any more.

The City has already started to refocus on its links with China and the Middle East and North America. It has created a system that makes it possible to trade Chinese equities in London. It has carved out a niche as the place to list Russian or Middle Eastern companies. It has started to pivot towards raising debt for businesses and governments across the developing world, and it is becoming an alternative technology hub to the west coast of the US. The City will need to double down on that, and focus a lot less on what kind of relationship survives with the EU. Its links with Europe have been great for the last three decades, but as the likes of Deutsche wind themselves down there is very little mileage left in them – it is time to move on to the next opportunity.

The City must move on from Europe

“Europe’s banks are in decline – the City will need to focus a lot less on the EU in future”

It thrived as the EU’s finance hub. But now new opportunities look more promising for the City

14

Deutsche Bank’s workers hit the road

Matthew LynnCity columnist

15


For a long time, Germany has been an exporting powerhouse. Its brilliantly efficient factories churn

out well-engineered, fantastically designed products that sell for premium prices around the world. Europe’s largest economy is also the world’s third-largest exporter and, at more than $300bn annually, it also runs by far the world’s largest trade surplus. Dominated by pharmaceuticals, medical equipment, machine tools and cars, it has few equals.

Brexity headwindsThat may be about to change. Germany’s economic data has been relentlessly gloomy in recent months, with the all-important manufacturing and export sector hit hard. There are lots of reasons for that. China is slowing; the US is not buying as much as it was; and many eurozone countries have weak consumer demand. But there is one other crucial factor: Brexit.

Germany’s exports to the UK are especially weak. A couple of years ago, Britain was Germany’s third-biggest export market, but this year we have dropped to the fifth-biggest, and we are still falling. “In April and May, German exporters sold almost as much to Austria as to the UK,” noted investment bank ING dryly in an analysis of the figures. It hardly needed to add that Austria’s population is just eight million compared with our 65 million.

There are some short-term factors at work. Sterling depreciated sharply after the referendum, and that made all exports from the eurozone less competitive. At the same time the British economy has been weakening and firms fearful of a no-deal exit have been postponing investment.

We’ve been Brexiting for yearsBut there is a bigger picture as well. Our trade flows with the eurozone have been declining rapidly for years now. From accounting for close on 60% of our trade, once imports and exports are combined, it is now down below 50%. It has been falling by a percentage point a year for more than a decade. Brexit has accelerated that.

Companies have understandably stepped up their efforts to find new markets and new sources of imports over the years we have been arguing about Brexit. And the areas where the UK has been strong in the last few years, such as technology, culture, business and legal services, and engineering, have all been a lot

stronger outside Europe than within it. We sell less and less to countries such as Germany every year, and now we buy less and less from them as well. In many ways our vote to leave the EU was simply a matter of the politics catching up with the economics – measured by trade, we had been leaving for years.

That doesn’t matter hugely to the UK. We had a massive trade deficit with Europe, and with Germany in particular, so we have relatively little to lose if there is a further decline. By definition, it wasn’t working very well for us, otherwise we would not have had such a big deficit. But it will matter to the countries where exports fall sharply. They were running big surpluses, and so jobs and company profits were all boosted by easy access to the British market. Once that is lost, it won’t easily be replaced.

Germany will survive just fine, of course. It has plenty of great companies and lots of other major markets. The UK will still be one of them. But it is now clear that Germany will suffer significant damage. It is almost certainly too late now for Germany’s government to change tack and try to engineer a softer Brexit. But as its economy suffers long-term damage, there may well be a reckoning for the leaders who failed to broker a compromise that worked for both sides.

Why German exports are falling

“Germany’s economy will suffer significant damage from Brexit”

Project Fear failed to move us Brits, but it should really have put the wind up the Germans

Germany’s industrial engine has stalled


16


There are signs that pressure is building for a radical monetary experiment in the eurozone. Over the

past four years, the central bank has printed more than €2trn euros, flooded the banking system with money, bought up government bonds and slashed interest rates down below zero in an effort to boost its flagging economy.

In 2017 and 2018, all that printed cash briefly fired life into the European economy. But now it is flagging again. Germany is close to an outright recession, growth is tepid in France, and Italy is no closer to a sustained recovery than it has been since it joined the euro 20 years ago. This is the problem facing Christine Lagarde when she takes as president of the European Central Bank (ECB). It seems certain she will have to do more. But what?

Will MMT go mainstream?The ECB can’t cut interest rates any more and it has already bought up almost all the bonds it is allowed to. If it wants to go any further then it needs to come up with something different. The outgoing president of the ECB, Mario Draghi, has spoken approvingly of “modern monetary theory”, the economic theory that the government can take on almost unlimited debt financed by the central bank so long as inflation isn’t a problem, then use that money to finance its spending. There have been plenty of other hints the bank is looking at some form of “people’s QE” – putting printed money directly in people’s pockets. It remains to be seen whether it actually happens or not. But there is no question it is under discussion. There is a problem, however – and not just the obvious one that it may not work. It will create even worse political divisions within the eurozone than exist already. Why? Because it is Germany that will benefit.

Of all the countries within the zone, the one that most needs a fiscal boost right now is Germany. It is the major economy in the most trouble – its export-driven model is running out of steam, and its massive car industry is over-reliant on big, highly polluting diesel vehicles at precisely the moment when the world has turned against them. It needs to find a way of kickstarting domestic demand, and the most obvious way to do that is with higher government spending. Chancellor Angela Merkel has already announced plans to spend €50bn on environmental initiatives and more infrastructure spending is likely to be unleashed soon. There is even a debate underway about relaxing the constitutional requirement to balance the budget.

In fact, Germany could easily afford all of that with more borrowing. Its debt-to-GDP ratio is only 60% and its bonds are on negative yields. Borrowing could

hardly get any cheaper. And yet instead it looks as if the ECB will simply come along and print the money for it. What that means is that the whole zone will in effect finance a blast of infrastructure spending in Germany.

The winner takes it allRight from the launch of the euro two decades ago, it has been clear there has been one big winner from the project: Germany. From the start, it locked in a low exchange rate that massively boosted its exports. Ever since the euro was launched, Germany has grown consistently faster than France (the two countries used to be more or less equal) and far, far faster than any of its southern European rivals. In effect, the euro has sucked demand and jobs from the rest of the zone and shifted them to Germany.

Now it looks as if it will be the main beneficiary of the next round of printed money as well. Demand will be boosted in that country, with money that it will never have to pay back. Its wages will continue to grow, it will renew its roads, railways, airports and energy systems, and it will do so at the expense of its neighbours. That’s great for Germany. But it is hardly fair on the other countries – especially those that received no form of fiscal boost when they were in deep trouble. The other countries have already started to notice they are stuck in a monetary system that only works for Germany. Helicopter money will just confirm that all over again – and create an inevitable backlash.

Europe’s radical monetary experiment

“The biggest beneficiary of even looser monetary policy will be Germany”

As the economy sinks, the eurozone’s central bank is thinking big. That’s worrying

Christine Lagarde is due to take over at the money-printers



Most companies – at least you would hope – have by now put in place plans for a no-deal exit from

the EU, or are at least planning to put together plans. But now there is something else – argh! – they have to plan for as well. Revoke and remain. The Liberal Democrats are now committed to revoking Article 50, cancelling the referendum result and staying in the EU. The odds are not high that they will win the power to do this, but a Lib Dem-led or “national unity” government committed to it is not exactly inconceivable either. You might think business doesn’t need to plan for that – that it is just the status quo and everything will carry on as before. But in reality remaining will have a big impact. This is what businesses must prepare for.

1. A raft of new lawsWhile we have been having an agonising debate about our departure, the EU itself has changed. It has introduced a raft of new environmental policies and is moving towards much closer harmonisation of tax rates. Takeovers are being controlled more tightly and a new fund is being created to invest in strategic industries. The UK will have to be part of that and companies will find themselves subject to all kinds of laws they had assumed wouldn’t apply to them.

2. A surge of immigrants There has been a significant drop in the number of young Europeans coming to work in the UK, especially from countries such as Poland and Hungary. Understandably, they were nervous about coming here when their status was so uncertain. But a Britain that has committed itself to remaining will suddenly be a lot more attractive. After all, the UK still creates a lot more jobs than any other major European economy and wages have been rising. With more immigrants, the labour market will start to look very different.

3. A wave of takeoversWe know that fund managers around the world have kept well away from British equities and, a few big deals such as the Hong Kong bid for the London Stock Exchange aside, global companies haven’t been interested in buying British business. Again, that was completely understandable. Who wants to invest when no one had any idea when we would leave the EU or on what terms? There are better things to do with your money. The result? The UK is cheap compared with other major markets. If the threat of leaving evaporated, lots of money would suddenly go into the FTSE and there would be a wave of bids and deals.

4. A rise in interest rates With growth positive, employment at record levels and with real wages growing at the fastest rate since the financial crash of 2008, there is no real reason for the Bank of England to hold rates down at “emergency” levels. Except for Brexit, of course. Logically, if that was taken off the table, then the Bank should start putting rates up again. With the global economy slowing, it might not happen right away. But it would happen quicker than if we were leaving.

5. Ever-closer unionFinally, if Britain did resolve to remain, then as a country it would be far more committed to the EU than ever before. If we do stay, then we might as well commit to pooling sovereignty with the rest of the EU, which would mean signing up to the euro. It might take a while for our economy to converge, but it would occur sooner or later.

Of course, the country would still be bitterly split on the European issue. The main opposition would either be the Brexit Party or the Conservatives, or an alliance of the two, committed to taking us out as soon as possible. The result of the referendum would not be quickly forgotten. Business would still have to live with a lot of uncertainty. But it would get used to that. The important point is this: remaining is not as disruptive as leaving. There won’t be chaos at the ports, or any dramatic shortages. But it is not really the status quo either. Whichever way the UK goes, change over the next few years is certain.

What to expect if we remain

“Remain or leave – change over the next few years is certain”

All ready for a no-deal exit? Good. But it’s not the only outcome you had better brace yourself for

The Remoaners may yet win the day


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