Britons Voted For United Kingdom To Leave European Union (EU) in Britain Exit (Brexit). Global Economy In Frenzy. What's Next For Britain?

Britain's 23 June Referendum - To Stay or Leave the European Union?

Unlike Greece's mulish desire to stay in the European Union (EU), Britain has, over the years, expressed utmost desire to leave the EU. The former would probably have a GREXIT (Greece Exit) if not for the last bailout by the EU. Whereas for Britain, the withdrawal from the EU was decided by tens of millions of British voters in this divisive referendum that will shape the ties between Britain and EU - To remain in the EU or to leave the EU and regain UK sovereignty? What will be the decision that Britons make after years of bitter talk?

BRITONS HAVE SPOKEN - United Kingdom Withdraws From the EU

Mirrored after GREXIT, it is known as BREXIT (British Exit), and the stakes were high. While the votes were constantly updated, most of it leaned towards leaving the EU. Below is the final result of this referendum - BRITAIN IS LEAVING THE EUROPEAN UNION AFTER 43 YEARS, with a 51.9% of voters polled 'YES' for the withdrawal. United Kingdom is the FIRST country to leave the EU bloc.

BRITAIN IS LEAVING THE EUROPEAN UNION

Push Factors for Britain to Leave EU

The top three debate topics for leaving EU commonly fell back on the reason of UK's sovereignty loss to the EU, the EU's burdensome economic regulations, and the EU's liberal rules for internal migration. The EU consists of 28 members states, and one of the laws rules that members have to admit unlimited numbers of migrant from the other EU countries.

When I was living in London, I came across frequent newspapers articles on the immigration issues. Most were not thrilled about the Syrian refugee crisis, though UK ranks 13^th out of 28 countries in terms of failing to resettle the number of people it has promised to take in. With the heightened fear of terrorism (Paris, Brussels, etc), most Britons disagree with the EU's free-migration rules as they believed it may allow more terrorists to enter into United Kingdom easier. But all these years, UK could not do anything about this, or even other issues, as EU laws override all national laws. Other reasons for Britain to leave EU can be read in [THIS ARTICLE].

Brexit's Effect on the Currency and Capital Markets

Widely discussed and warned by governments, capital analysts and investors across the globe, the referendum if passed, will affect global financial markets and roil the currency, commodity and capital markets, and many other sectors such as import/export, property, automotive, medical and travel. It was said that if Brexit happens, the British economy may shrink by between 3.8 and 7.5 percent by 2030 — depending on how well subsequent negotiations for access to the European market ultimately went.


London may lose its attractiveness as a financial hub, that many international banks and financial institutions are currently based at. The Square Mile and Canary Wharf are the two central financial districts (CBD) in London. Banks may move their operations out of UK, as voiced out by Morgan Stanley president, Colm Kellleher on his bank's probable decision. Hence, it was not surprising that Londoners voted to remain in the EU (Check out this article too to check out how UK has voted in terms of area).

View of Canary Wharf from the area where I lived in London
(Lived near South Quay DLR, 5 minutes' walk to London's CBD)

Stirling Pound Plummeted To a 30-year Low

Since the start of the campaign in February this year, the pound has been fluctuating vigorously (Yes, I have been tracking this as I have vested interests in the Stirling Pound). But even without the conclusion of the votes, the visceral effect of the Stirling Pound have was observed as the British currency have plummeted to a 30-year low against the US Dollars. Many have been holding on their cash to buy on the dip. Where in UK itself, the Britons were scrambling to exchange their pounds to other currencies in view of the busy Summer vacation period of June to August.


Asia Markets In Red
While typing this article, I was concurrently watching the Bloomberg live telecast and discussion online. The telecast showed the global stock markets performance, and it was alarming to see the sea of red across the markets. In Asia markets, traders started their day in the wee hours of the morning as the most of the international markets were experiencing tumbling effects as the voting result kept updating, with panic sweeping across the financial markets.

Effect of Brexit on Japan Market

Japanese Yen has gone up, much to the probable dismay of those intending to visit Japan for vacations. Business-wise, companies that rely heavily on Japan imports like parallel imported Japanese cars will be affected. The Japanese government sees the demand for the safe-haven yen as a crisis as it would hurt Japan's exports, and they have been attempting to keep the yen low to stimulate economic growth and boost inflation. On another note, NIKKEI, the Japan stock market, is suffering the worst day in five years.

Gold Price Rises

To investors, gold seems to be the best bet in the long run. Gold prices surged to a two-year high. While pound being dumped rapidly, the glittering attractiveness of this commodity increased. This is, despite the fact that there is no real pattern to spot gold price changes following major shock events, as analysed in the Bloomberg chart as seen below.

FREXIT 

Following the Brexit, this may cause contamination whereby other EU countries may follow suit. For example, France may call for a referendum, and have their own FREXIT. Denmark, Sweden, Austria and Italy may follow suit.

Will David Cameron Lose His Job?

David Cameron, UK's current Prime Minister pledged in January 2013 that a referendum to decide if UK remain or leave the EU will be implemented, should the Conservatives wins a parliamentary majority at the 2015 General Election. However, he stood firmly to what he said that he "will campaign with all his heart and soul for Britain to stay in the EU when the referendum comes", having held rallies over the last few weeks to get UK citizens to vote for the stay in EU. He laid his reputation on the line by doing so, hence analysts reported that it will be difficult for him to keep his job for a long term.


Updated: David Cameron announced of his resignation during his post-Brexit poll speech at 10 Downing Street. This is despite that nearly two-thirds of Brexit-backing Tory MPs sent a letter directly to David Cameron to remain in office regardless of the Referendum results. Cameron will step down as Prime Minister by end October 2016, after holding this post for six years. He leaves the invoking of the Article 50 and other agreements and negotiations to the new PM.

For Myself

UK has a special place in my heart. It was in Central London that I spent some of my happiest months of recent years at. Following this Brexit issue for quite some time, I respect what the majority Britons voted for, with the country of split views waking up this morning (24 June 2016) to the decision of the UK withdrawal from the EU. Amidst the current economic and political impacts from the voting results, let's see how UK makes the best out of this double-edged sword event. Nevertheless, I cannot wait to be back in UK - Pounds up or down, Part of EU or not.

*All efforts were done to ensure no individual views and opinions of my own was expressed in this article due to possible conflicting situations. This article is a consolidation of various views, analysis and market conditions that is/will/has been  affected, as reported by online and televised news sources.