Joel Ross Joel Ross

Brexit has been triggered and the final outcome is very unclear. Chances are high that it will be a hard Brexit, but it is way too early to tell. The EU cannot let the UK off softly, or many more will leave. The UK cannot agree to a large payment nor to allowing free entry to the UK for anyone from the EU which is what the vote was largely about. Meantime, the UK economy is doing nicely, and has not yet been hurt by Brexit. In fact, several major companies have announced expansions in the UK. Inflation due to the drop in the pound has been partially offset by rising wages, so consumers have not been nearly as hard hit as projected. The lower pound has created a material increase in exports, so jobs are plentiful. None of the banks are up and leaving, nor will they. Some staff will be moved to Dublin and maybe some to Frankfurt, but the London capital markets will remain where they are. The EU cannot afford to disrupt world capital markets by shutting out London. On top of all this is the French election which could create other major problems for the EU.

The French election is just a few weeks away, and it is definitely possible Le Pen could win enough votes to be president or, if not, to be a major force in French politics. If she wins then everything changes for the EU. She says she wants Frexit, and that would completely blow the negotiating position of the EU on Brexit. Assuming she cannot win, which is what you read and hear from pollsters and the press, is reminiscent of what those same people said of Trump winning. Just because Wilders did not win has nothing to do with France. Completely different calculus. He was a complete nut. She may have far right positions, but she is not her father, and is much more sophisticated about her campaign. If she wins, the Euro tanks and currency markets become volatile. The UK will look good to investors and bankers. Add to all of this, Putin is throwing all he has into seeing her elected, and he may be able to influence the outcome. France is not the US.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?


NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2024 ALM Global, LLC. All Rights Reserved.