Brexit, London, UK, financial

Summer in the City of London, despite Brexit:

In 2020, my German uncle sent me the typical Christmas message. He did, however, offer something noteworthy. “The English made too many promises and did not take enough into account when it came to Brexit,” he wrote in German.

We'd never discussed Brexit before. And I'm relieved I didn't answer, as those were his final words to me before succumbing to cancer…

As terrible as it may be, the news for Brexit Britain has improved significantly since then, especially in the City of London.

According to The Telegraph, “London has retained its crown as the world's leading financial and professional services destination…” because “the Square Mile outperformed other major financial hubs, including New York, Singapore, and Paris, as corporations responded rapidly to Brexit…”

This is according to a recent analysis by the City of London Corporation, which is – ahem – fully unbiased…

The poll showed that the City has “unmatched international financial reach” and excels as a technology and innovation centre, with its share of Fortune Global 500 headquarters increasing by a third in the last year. Additionally, it was Europe's main financial services investment destination and the world's largest foreign currency trading center.”

The Telegraph also reported on an updated EY analysis on global financial firms' latest plans to flee the City post-Brexit:

According to a poll conducted by EY, nine out of ten significant financial services firms aim to develop or extend their headquarters in the Square Mile…

Investor confidence in the UK financial services sector is at an all-time high, having risen considerably in recent months as pandemic restrictions ease and Brexit fears subside.

Brexit fears did not materialize; so, why did bankers remain? Indeed, one of the primary anxieties around Brexit was that they would leave in the first place…

The Express explained how this confidence is translated into boots on the ground:

Despite expectations that international banks would abandon London in the aftermath of Brexit, multinational investment banking titan Citi began a £100 million makeover of its 42-story Canary Wharf tower. Citi's president for the United Kingdom, James Bardrick, stated that the investment demonstrates the bank's commitment to London for “at least the next 25 years.”

Since Brexit, Citi has added over 1,000 jobs in London, bringing its total staff to 9,000. I'm wondering as to how many of them are citizens of the European Union.

While forecasts of a 232,000 job loss in the banking sector were amazing, this doomsday article in the Guardian was my favorite:

“On “day one” of Brexit, city firms aim to shift 10,500 jobs out of the UK, with Dublin and Frankfurt the financial centers most likely to benefit from the UK's exit from the EU.”

According to EY's job tracker, which includes job announcements through November 30, the predicted number of affected positions has reduced from 12,500 a year ago.

By mid-2021, the European Banking Authority anticipated that 95 bankers will have fled London for other parts of Europe…

So, what precisely occurred here? How could the establishment be so wrong? Why were such pessimistic estimates made? How is it possible for those attempting to foresee financial markets to miss their own behavior?

That is, it is improbable that the EY surveys are to blame. Surely it is the bankers who offer the responses that are at fault?

My suspicions go deep.

To begin, I believe the bankers wished to avoid the hassles associated with travel and migration. As a result, opposing Brexit became fashionable. Especially in multinational work environments.

Second, forecasts have an effect on the argument when economic and financial studies on political issues are conducted. As a result, you can adjust estimates and assumptions to reach the desired result, exerting the desired impact on politics.

It's a little embarrassing that we had to learn all of this again the hard way in the aftermath of Brexit, during the epidemic. I got deceived once…

Thirdly, Europe requires access to the City in the same way that the City requires access to Europe. As a result, the EU has proposed extending until June 2025 a temporary waiver allowing European banks and fund managers to utilize UK clearinghouses, as well as the same for euro-derivative clearing rights.

Indeed, as the Telegraph reported in September, “Financial services exports to the European Union surged in the months following the UK's exit from the EU, defying predictions that the City would be devastated by a trade collapse.” This comparison does not include pandemic distortions because it spans the years 2021 to 2019.

So, instead of a drop-in activity, there was an increase!

Yes, “the results refute CEOs' and politicians' warnings that Brexit would cripple the Square Mile's ability to trade with the Continent,” but here's the kicker: “European enterprises appear to have borne the brunt of the damage.” Financial services exports from the EU to the UK plummeted by more than a third, largely hitting Irish, French, and Dutch firms.”

It's unsurprising that bankers choose not to migrate to Europe! Their business did not.

And this is for a sector that was left out of the Brexit deal, too much wailing and gnashing of teeth.

However, the City is not the only place that is thriving. Indeed, even the British automobile industry is doing well these days, owing to Brexit. Bentley just announced a £2.5 billion investment in Crewe to build the world's first fully-electric automobile, creating 4,000 employment.

 

According to industry executives, the UK's biotechnology sector may be entering a “golden age.” According to the BioIndustry Association (BIA), biotechnology and life sciences enterprises will raise £4.5 billion in public and private funding in 2021, a 60% increase over the previous year.

As we stated during the vaccine debate, firms would be insane to establish operations in the EU after witnessing how vaccine producers are treated in that country…

All of this adds up to substantial economic growth. According to the International Monetary Fund (IMF), the United Kingdom will outgrow the rest of the Group of Seven (G7) countries by a significant margin.

Our stock market should also do well, with large oil and gas companies finally outperforming. That is not to say that we require it. According to Schroders, the UK has a significantly higher proportion of ten baggers than the US, implying that the share price surged by more than 1000 percent.

Of course, this is being noticed globally, not just in the United Kingdom. Francois Asselineau, a Frexiteer, really let 'em have it in a video uploaded online:

Macron also declared that he would extend a red carpet to the hundreds of thousands of London residents who will cross the Channel in search of asylum in France.

“What has happened in the year since Brexit?”

The UK has a 4.5% unemployment rate, which is less than half that of France.

No, but bear with me. Isn't it possible that I had a dream about it? Brexit was dubbed the apocalypse, but it is not! The United Kingdom's growth rate is faster than ours…

…Google, Boeing, and Shell have all relocated to London.

The City of London has restored its position as Europe's premier financial center, and the French are well aware that migrants wish to migrate to the United Kingdom.

We have been assured that the UK would fully withdraw from international affairs.

It created an alliance with the United States and Australia, costing us the submarine contract in Australia.

According to Grégory Claeys, a researcher at the European think tank Bruegel,

Frexit would result in the cessation of financial flows and the collapse of the global financial system.

By comparison, while the collapse of Lehman Brothers may appear to be a trivial event, it had huge real economic consequences.

Yes, I'm certain it would…

Indeed, depending on how you depart, it may. The French would very definitely devise a means of wreaking damage…

And, of course, there is Brexit. Britain's withdrawal from Covid constraints comes as Europe descends into unrest and instability over mandates, passports, and isolation periods. Despite Brexit, a senior public health official, Professor David Heymann of the London School of Hygiene and Tropical Medicine, feels that “the UK is the closest country to being pandemic-free if it is not already.”

Ah, the benefits of an erratic Prime Minister: no one in government dares to announce another lockdown…

However, what if Britain flourishes following Brexit? What if the true nature of the EU is revealed? What if the EU's reality of suffocating its own prosperity becomes widely known? What occurs next?

Editor, Fortune & Freedom, Nick Hubble

The post Summer in the City of London, despite Brexit, appeared first on Fortune and Freedom.

The post Summer in the City of London, despite Brexit appeared first on https://gqcentral.co.uk

 

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