Eric Curran, Managing Partner, DM Hall.
Well, the Brexit vote is over, and the world has not stopped turning. In fact, far from a cataclysm, Armageddon or Apocaplypse, everything seems remarkably normal despite a few stumblings around the Footsie and a dip in the value of the pound.
But, outwards appearances of equilibrium aside, it is still far too early to say with any certainty if this is a phoney war – or if hostilities, with consequent economic casualties, are going to commence in earnest as the exit negotiators line up their big guns next year.
Markets react to a dizzying variety of stimuli, and though commentators were nonplussed on the night of the vote itself last month (June), Brexit is actually just one of many factors which sway the indices on a daily basis.
From my own professional point of view, the patterns of survey numbers from before Brexit and immediately after is exactly the same. Does that reflect a sanguinary view of the market – or that people were making post-Brexit decisions in advance? Again, still too early to say.
Our marketplace will always be dictated by economic activity, confidence, jobs, security of employment and, of course, marketable products. The question at the moment is: are we in more uncertain times than we were?
The answer is yes in terms of trading agreements, and what shape or form they are likely to take – and nobody at this point can accurately call how that will impact on us as a nation which lives and dies by trade.
It would appear at the moment that Britain has a number of suitors, from the former colonies and elements within the Americas to China, all keen to sign new trade deals. Do they have substance? Once again, impossible to say at this stage.
What can be relied on is that speculators will have field days over the course of the next few years as rumours fly thick and fast and the nimble players at the heart of the markets skim a profit off each surge in volatility.
Will investment, both foreign and domestic, stagnate? Probably yes, as the paralysis of uncertainty seeps through the market but, at the same time, there will always be investors who scent opportunity where others fear to tread.
Company owners, particularly manufacturers, may be reluctant to expand if they don’t know where their markets are likely to be. or if existing agreements are going to hold water. Some may see new market chances, but are they going to bet the farm on them?
Whether we have a hard exit or an easy passage will depend very much on the tenor of the negotiations and whether accommodations can be found. Both sides will be willing to continue to trade, but only on terms which are most advantageous to themselves.
And politics will intrude. Euro hardliners such as Jean-Claude Juncker and Martin Schultz are itching to punish Britain, pour encouragez les autres, while pragmatists such as Angela Merkel are keen to take a more ameliorative line. Which side prevails will have a major impact on all our futures.
There is still simmering resentment in areas such as London, which were heavily Remain, and where elements are actively seeking to undo the vote. But the only possible response to their disappointment is: get over yourselves. That’s what democracy is all about.
What happened at the vote is not important now. What matters is how we live with the result.
People in Britain and people all over Europe still have to live. They still have to eat, sleep and pay the bills, and trade will still happen to make all these other elements of societal interaction possible.
The UK is a global economy, and has been for long years now. Outcomes of this momentous period in our history may be positive, or negative, or neutral. Each will have its implications but, whatever the end game is, we will all still have to make it work.
Eric Curran is managing partner of DM Hall Chartered Surveyors, based in the firm’s Glasgow North office.