Tuesday, June 28, 2016

Why All the Post-Brexit Hysteria?

The night after the vote for an independent United Kingdom from the European Union had concluded I found myself at dinner with my wife trying to explain why the world portrayed by many financial analysts and news outlets was so filled with doom and gloom. “Why does the UK leaving the EU necessitate a global or UK financial meltdown?” she asked. And then it hit me, this was the question the world’s largest financial publications were failing to ask, or at the very least to answer honestly.

The answer to this question can be as complex as you would like to make it, but the clear and simple answer is this: the UK leaving the EU fundamentally necessitates neither of these things. To justify this simple answer we need only consider what affords a national economy its productivity. The intellect of the talented people of the UK that create value, the infrastructure, the primary institutions, and the capital goods that allow individuals to turn their time into valuable outputs have not changed. It is not as if London’s financial district or the many manufacturing industries around the UK were decimated by a meteor and must be rebuilt from the ground up. Physically and intellectually the UK is the same today as it was the day before the vote to secede.

So, what then is causing all of the commotion?. ......To Read More....

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