Brexit, British Pounds and Inflation

@scheng1 (24947)
Singapore
June 24, 2016 8:24am CST
The immediate effect of Brexit is the dramatic fall in British Pounds. Many people in my country and other countries are happy because they can use lesser local currencies to buy GBP. In the short term, tourism will boom (assuming that ISIS does not carry out attacks in UK. It sure is a good time since the country is divided, and the government is divided). In the long term, the residents in UK will see a high inflation since the Pounds has fallen in value against other countries. If it continues to fall, 10% to 15% inflation rate is possible.
9 people like this
10 responses
@topffer (30707)
• France
24 Jun 16
I am considering to have a week of vacations in England if the pound continues to fall. I doubt that the tourism will save their GDP, but it will be my own voluntary contribution to the British economy. I have to do it this year : next year, I will perhaps need a visa, because it seems that Brits prefer to live between themselves and do not like anymore foreigners. Seriously, I am asking myself what will happen to the 3 million Europeans living in UK ? And to the 2 1/2 million UK citizens living in Europe ? I have a noisy British neighbor, so I am interested to know.
6 people like this
@garymarsh6 (12184)
• United Kingdom
24 Jun 16
There is a lot of misinformation going on and still scaremongering. No one knows what is going to happen. Hopefully things will settle down in a while. The £ and $ always fluctuates during an election and although the £ has dropped significantly it is very likely to return again and be strong against the Euro as it has always been, Britain will not throw out the workers of course it very much depends on how the EU treats the UK we have had enough threats from Juncker, Hollande and Herr Merkel.
2 people like this
@topffer (30707)
• France
24 Jun 16
@garymarsh6 I see a problem around social security soon. A Brit will have no problem in France, as we offer free social security to any resident. But I am not sure that I would stay in UK if I was French. Whatever the way EU will treat UK, you will lose some GDP points. Nobody has interest to see your money plunged into deep waters : the European Central Bank and the Bank of Japan are ready to support the pound if it continues to fall.
2 people like this
@garymarsh6 (12184)
• United Kingdom
24 Jun 16
@topffer Up to now any EU citizen are entitled to social security benefits in another EU state if you have been working here and are resident here. What we do not like is that if you come to this country and have made absolutely no contribution then you should not be entitled to any benefit which is what a lot of people have done. This is one of the changes that the UK were seeking prior to the referendum.
2 people like this
@marguicha (81832)
• Chile
24 Jun 16
I thought that The European Union would mean help for everyone of the countries that were there, but it was not so. There were other variables to consider. Now it is yet to be seen how the british will manage their economy.
5 people like this
@topffer (30707)
• France
24 Jun 16
The EU helps countries needing really to be helped, i.e. countries from Eastern and Central Europe : countries having a good economy are supposed to support others to help them to reach our standards. UK was complaining about its contribution to EU, but countries like France and Germany are contributing even more, and will have to pay the part that was paying UK because the European project, which is great, has not changed with UK leaving... Not to tell that the rest of Europe has received more than 1 million of migrants from Middle East, while UK was accepting to receive a few thousands. If UK obtains the same status than Norway, which would be the best for them, all they will save on their contribution to EU is 0.03% of GDP, while losing 1.5% of GDP.
3 people like this
@scheng1 (24947)
• Singapore
25 Jun 16
@marguicha for one thing, the trade agreements apply to all the countries in the EU. That means once China signs a free trade agreement with EU, it can import and export goods without paying tariff. That is one main benefit of having the EU.
1 person likes this
@scheng1 (24947)
• Singapore
25 Jun 16
@topffer I think UK will lose more than 1.5% of GDP. If UK cannot negotiate free trade with other countries, you can expect a lot of jobs to exit UK and move to EU. I think the poorer countries in EU will like to see the jobs come in!
1 person likes this
@JohnRoberts (41183)
• Los Angeles, California
24 Jun 16
The people spoke and the majority wanted it.
4 people like this
@scheng1 (24947)
• Singapore
25 Jun 16
This shows that the majority are fools!
@JohnRoberts (41183)
• Los Angeles, California
25 Jun 16
@scheng1 Why? How would you like it if you were called a fool or are only your beliefs acceptable and everyone else must fall in line with them or face your hate?
@scheng1 (24947)
• Singapore
25 Jun 16
@JohnRoberts It is not just my belief. All the world rulers advise against this move, including Obama and Xi Jinping, yet they are moving out of EU. It is not a wise move for UK at this time, and now that Scotland may want independence because it wants to stay in EU, it is even more of a foolish move.
@LadyDuck (122389)
• Switzerland
24 Jun 16
I do not believe that you will see such an increase in the inflation rate. There are currency (like the US Dollars) that have lost 30% of their value against the Euro since the 2002, but I have not seen the inflation grow in the United States.
3 people like this
@scheng1 (24947)
• Singapore
25 Jun 16
Inflation does grow in the US. The saving grace is the low oil cost. If not for the low oil cost, you will hear more complaints about the rising cost of living. You can search through all the threads, and you can see that everyone is complaining about the price of goods. The official inflation rate is a lie. All the forum discussions are reality.
1 person likes this
@LadyDuck (122389)
• Switzerland
25 Jun 16
@scheng1 I know that the official inflation rate is a lie. All the goods are rising here in Europe and the price of oil has not decreased even if the real cost of crude oil is so much less expensive than one year ago.
1 person likes this
@scheng1 (24947)
• Singapore
25 Jun 16
@LadyDuck The gas price in US has fallen a lot because US has oil. Even then, people there are complaining about the price of goods. Even if the manufacturers does not increase price, they will put in less in the packet.
1 person likes this
@garymarsh6 (12184)
• United Kingdom
24 Jun 16
The British pound and the American Dollar fluctuate whenever there is an election this is not a new phenomena. Of course the markets are jittery at the moment but they will settle down eventually.Just a reminder though that throughout this time the UK was outside of the EURO zone and our economy was far more stable than most of those throughout Europe where we have managed to survive reckless unemployment and recession some of the EU nations have not done quite as well.
2 people like this
@scheng1 (24947)
• Singapore
25 Jun 16
The economy is stable because many rich people park their money there, and many companies set up their base there. Now that UK is out from EU, a big question is: whether the rich people will move their money out or the companies will move their operations out. Ford has announced job cuts because of Brexit. If there is trade tariff, it does not make sense for factories to retain their operations in UK.
• Preston, England
25 Jun 16
we are in a dangerous skid because of the result - an immediate effect that should have been spelt out more in warnings from the doomed stay campaigners
1 person likes this
@scheng1 (24947)
• Singapore
25 Jun 16
A lot of companies are probably planning to leave UK now. No point they keep the operation in UK when they cannot access EU market. Once Scotland declares independence, the situation will get even worse. The banks will move to Scotland, and factories will probably move to countries in EU.
1 person likes this
• Preston, England
25 Jun 16
@scheng1 we have achieved a state of social anarchy many militants could only dream of and it was capitalists doing it to themselves
1 person likes this
@scheng1 (24947)
• Singapore
25 Jun 16
@arthurchappell If Brexit forces an exodus of the rich people, and the big companies, I wonder how the situation in UK will be! Just hope that ISIS does not come to cause more problems.
@salonga (27965)
• Philippines
24 Jun 16
We have to wait and see. Meanwhile I do pray for the UK as I have many friends and relatives residing there.
1 person likes this
@scheng1 (24947)
• Singapore
25 Jun 16
I think your friends and relatives will want to move out after a year or two, when they see the full effects of Brexit. If Scotland gains independence, that is good. At least the Scots value the great market offered by the EU.
1 person likes this
@salonga (27965)
• Philippines
25 Jun 16
@scheng1 I have yet to hear their thoughts about this matter.
1 person likes this
@scheng1 (24947)
• Singapore
25 Jun 16
@salonga Wait till the locals turn against them! The anti-immigrants sentiment is very high now.
@ilocosboy (33293)
• Philippines
24 Jun 16
brace yourself, but hope good economy return soon.
1 person likes this
@scheng1 (24947)
• Singapore
25 Jun 16
It will not. UK will lose a lot of jobs, and a lot of investments.
1 person likes this
@ilocosboy (33293)
• Philippines
25 Jun 16
@scheng1 we can't that yet, everything has its purpose.
1 person likes this
@Hanyouyomi (1935)
• Dallas, Texas
24 Jun 16
So that's what happened with Brexit... Oh, these next few years are gonna be so much fun...
1 person likes this
@marlina (62408)
• Canada
24 Jun 16
We will see down the road.
1 person likes this