Anything happen last week? 🙂 Yes, Brexit happened. In addition to our market update, here’s some perspective:
- Brexit means that the United Kingdom voted to no longer be a free-trade partner with the European Union members. The UK was NOT a currency member of the EU, the UK kept its currency as the pound sterling. The departure will be slow to implement BUT not as messy had the UK’s currency been the Euro.
- The UK represents less the 4% of the world’s economic output. (GDP) The UK’s impact on the world economy is minimal.
- The major impact will be on the UK’s economy itself. Most predict the UK economy will slow drastically and possibly go in to a recession.
- Markets tend to overreact to uncertainty. Most did not expect the Brexit vote would win.
- Now is a good time to visit the UK. The British pound is down 10% versus the US dollar!
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