Thursday, June 30, 2016
In the UK Last Week / Brexit Thoughts
Here's the view form my office at one of our portfolio companies (Clear Score) which is located near Lambeth bridge in London. Typically sunny British weather.
My apologies to my UK gaming friends but I just didn't have any free time in my schedule - hopefully I'll plan better when I'm over again.
I think I'm becoming a cricket fan.
What I can comment on is an extreme disappointment with the way the campaign was conducted on both sides. The leave side was basically racist in it's depiction of immigration and the stay side portrayed immediate armageddon and execution of all puppies and kittens upon voting to leave.
What's more disappointing is the apparent lack of planning on what to do next if the vote was to leave (when jumping off a cliff it pays to peak over the edge and plan for the landing).
Countries evolve and immigration is a very important factor in keeping a society vibrant and supporting a growing middle class - especially in societies with declining birth rates. We often have overly optimistic memories of how good the "old days" were or fall to ease of blaming subgroups for our current problems.
As an investor, I really have no idea what the outcome will be of the "Leave" vote but suspect it will be mildly positive for the UK short term but then turn negative as the weight of losses from the migration away from London as the European financial hub and the unending grind of the demographic reality of an aging population take hold. I still really like the UK as a market but will raise the bar on investment returns to compensate for the increased uncertainty. By the way, anyone who states they "know" what will happen post leave isn't really being honest.
As an US citizen who spends a lot of time in the UK and has a deep affection for the nation, there is one silver lining from the conduct of the Brexit campaign and the Leave vote: My British friends have forever surrendered the high ground of making snide comments about the US's national disgrace of Donald Trump. I'm afraid your just as bad as we are BUT here in the US, we've still got a chance to send Mr Trump packing in November.