The Great Theresa May. By FAR the Worst Prime Minister that the UK has Ever had.

[Methusala]

I don't think that all of the ills likely to be suffered by GB in the near or medium future are down to Brexit. EU are in a lot of trouble and this is related to the malaise generally at the heart of the global economy. The crash of '07-0'8 was not a "normal, cyclical" fluctuation. It was caused by the un-restrained ability of capital to dictate the tradability of junk (also known as CDO's {collateralised debt obligations}). These are low performing loans such as mortgages with little real ability to be repaid. S&P and other ratings agencies lied about the worth of these and they were sold to governments, both local and national as well as to anyone else in the investment markets. This caused the bankrupting of many local governments in Oz making amalgamations politically possible. But that is a digression.

 

The fact that, post 2008, governments lacked either the will or the political power to change the way banks operate meansz that we are destined for much more of the same type of financial disruption (read recession or more likely, deep depressions) until a reckoning occurs and finances become more realistic. Note that the Russian federation and China and possibly others including india are moving towards a gold backed currency. Even heard talk of a central, gold backed, crypto currency for international oil trading. This is essentially what Russia and China are using, gold backed Yuan, to trade oil and manufactures between themselves.

 

The USA finds itself becoming irrelevant in financial trades so brings out the big stick ie: Bolton's statement this week that the US will take Venezuala's oil. Trump is also pushing the military brink by abrogating the INF treaty and threatening Space Wars again.

 

To get back to old Britain, it is a bad time to be rocking the boat. Europe's economy is hardly sustainable at all and they will use any action to improve their position in trade against Britain. For Britain it is a bad time to be in the EU but possibly worse to be outside.

 

 

[facthunter]

Nissan going to close it's British operation due uncertainty. and soft market. Nev

 

 

[Jerry_Atrick]

@Methusala - You may be interested to note that in the UK at least, CDOs are making a slow comeback - bit with some very different rules to minismise risk. However, not all CDOs were bad and in fact some hedge funds made a tidy sum thanks to the sheep mentality that is the market; they bought up "toxic" assets - sold at knowck-down prices thanks to the political climate rather than sound financial valuations and after 6 months, most of the buyers had made a handsome return on their investment - many returning to par value and holding on a little longer led to them acheving heyond par valuations - when you consider some of these assets went for 5% of par - well you do the maths...

 

Anyway - back to Brexit - you are right - the EU is in a bit of a pickle. At least 24 of their member states are under economic stress and the ECB, with its quantitative easing program that included buyiung corporate debt is struggling. Coupled with a global slump in demand and China ramoping up its stimulus programs leading to an artifical economy, things don't look too rosey. I do agree that over the short term, the UK is probably better in than out of the EU - but I think that will always be the case. But now is worse than when the global economy is firing on all cylinders - but - if the remainers want the UK to rejoing the EU, now is a great time to leave. Imagine the crieds of how bad things are out of the EU if the UK economy slumps. The cries to rejoin the EU, albeit on less favourable terms (UK has a discounted contribution and has more opt outs than any other nation - both lilely to be lost should the rejoin) will echo loud through the regions unemployed and it will be a landslide victory to return.

 

On the Nissan thing, an official version of events is here: Update to Production Plan for Next-Generation X-Trail

 

Yes, they mention Brexit as a contributory factor, but by no means even material. The global economic slump and I would also infer, given the mention of different drivettrains, the attack on Diesel cars is probably the real driver. Add in Brexit and it becomes a no-brainer. Take Brexit away and there is still no guarantee Nissan sould have stayed on. Interestingly, Nissan have committed to investment in the Sunderland plant.

 

 

[Methusala]

When a rotten system (such as wrapping up rotten fish {CDO's}) in plastic so the purchaser is ignorant of the quality, then getting your mate (S&P's or Moodies') to swear that the goods are perfect, will always bite most purchasers. Scavengers who can see that 10% of the fish is sound can make a profit buying at 5%. This is called opportunity cost. The system as a whole has still forsaken 80% of their capital to a swindle. You can't dress this up as anything but "white collar" crime.

 

Anyway, as you say, back to Brexit. It has been my contention throughout that the Brexit thing was a scheme brewed by perhaps Textor Crosby as a way to bamboozle the voters into sticking with the conservatives to keep the socialists on the outer. NEVER MIND the cost to the nation downstream. You may recognise the same MO in our current mob of ministers and backbenchers. They will lie to voters about the effects of restricting tax benefits to the financing of only new dwellings to protect their backers. Also to protect the scandal of giving "tax refunds" to people not paying any tax.

 

You have admitted that the GB population joined the EU on very favorable terms. Was any effort made to warn voters that they could lose this "most favored nation" status? No, of course not! As I said,"For Britain it is a bad time to be in the EU but possibly worse to be outside."

 

 

[Jerry_Atrick]

I never said GB entered the EU on favourable terms.. I don't know the terms they entered the EU (I think, then the EC), but I do know since I moved here in the mid - late 90's, they were able to negotiate various derogations. from treaty requirements and laws that were introduced since.

 

As I have said before, I think both sides were disingenuous in their campaigns - however, one has to remember neither side was a political party and the idea of promises is a, as we say in Australia, furphy. As an example, the famous Boris Johnson "promise" that as a result of the savings, "we could put an extra £360m a week into the NHS [[ublic health]"... My bold, but since when did the word "could" amount to a promise?

 

The reality is both camps twist the facts and even theory to present their side of the case. I have mentioned many local gold-plating of EU regulations that went well beyond the intention of the EU regulation - but the gold plating bit was blamed on the EU. I have often said be careful about gaining control back because the same people who have control do the gold plating - at least in the EU if they gold plating goes too far by a national government, the EU can, in theory compel that national government to reign it in a bit.

 

Back to CDOs... Yes.. they, as well as many other asset backed products were a conman's dream. I had the pleasure of unpicking a few ofter the GFC to work out exactly what the gubbins went on. And guess what - the paper trail almost always went cold - and getting info from an SPV administering the ABS often ended up in scans of hand-written asset lists and valuations. The best was an impaired MBS purchased at 10% above par on the hope that the foreclosures would yield a better return - in a falling property market. I rued that one - somewhere a trader was driving around in a Ferarri for that, while I have my 15 year old V-dub...