This Friday Britain decision to be in or out of EU.
So what if it is out. My analysis as follow
There are surely effect if Britain leave EU, probably that explain the sluggish performance of the England team as the players are very worried of their future.
So what would happen?
1) The bank of England have assess the long term economic consequences of Briexit, it is a loss of 3000 to 5000 pound annually per household for the next 5 years before Britain settle down.
2) The pound will surely depreciate very quickly. I think it would drop about 15% to more than 20% from current price. Which will bring the pound to be almost the same value as the Euro. That’s mean joining Euro despite out of EU. However one can argue that a devaluation will be helpful for the economy, but these effect now is less significant than what happen in 1992.
3) The Bank of England do not have the ‘necessary ammunition’ to reduce interest rates as rates are low. I think there is very little the monetary policy can be done for these.
4) Trading condition now have changed so devaluation of currency might not help England at all as compare what happen in 1992. This is mainly due to regulation and cross border issues.
However the reasons, people are driven by emotion at times rather than logical deduction. That why the other side of the Atlantic Ocean ban immigrants is a good idea and people likes it so much.
I do agree this is a golden opportunity to make a lot of money, or lose a lot of money. Like how Georges Soros broke the Bank of England in 1992. But according to him the planning, analysis and execution take 10 years.
Anyway it goes good luck to everyone.