BREXIT Mega Thread (The Saga Begins?)

[The Sauganash Union]

The European Medicines Agency is a meaningless body. It just sounds nice. That it is being relocated is simple EU propaganda - the only effect it will have on Britain is that those professionals - i.e. servants of a foreign power - will no longer live here. Who cares? Bye bye.

The same is true of the EBA, only it is slightly more important. The work covers all of European banks, so it doesn't matter too much where it is. It's just a prestige loss.

Prestige was what made London so attractive for finance, being so close to the centre of it all. If we lose our prestige what do we have? We'd have to start relying on race to the bottom corporate and capital gain tax rates and deregulation - which would be humiliating and shitty.

The rise of London's status as a financial city is a lot more than a mere coincidence. The fact that its financial industrial began to rise when Calvinism was taking off in Britain is also not a coincidence.

[Great Nepal]

What's worse, working 37.5 hours a week on a farm for £8.25 (£16k pa) or working a 0 hrs contract for JD Sports?

Former. Farming is a seasonal job, there is no career prospects from working a farm job, you live in middle of nowhere so you pay excess for basically everything, you live in middle of nowhere so you can do shitall for entertainment, you live in middle of nowhere so you better like where you're working at vs. latter which is uncertain job but you can get permanent contract, you live in civilization so you have more choices for everything and there are twenty employees in your doorstep. Taking uncertainty 100% of the time.

[The Sauganash Union]

If Europe's financial markets leave London because of Brexit, where is the most likely place they would go?

Dublin?
Amsterdam?
Frankfurt?
Paris?

[Vassenor]

If Europe's financial markets leave London because of Brexit, where is the most likely place they would go?

Dublin?
Amsterdam?
Frankfurt?
Paris?

Frankfurt seems most likely.

[Anere]

If Europe's financial markets leave London because of Brexit, where is the most likely place they would go?

Dublin?
Amsterdam?
Frankfurt?
Paris?

Frankfurt or somewhere else in Germany. The fate of the European economy and even that of the entire European Union rests upon German shoulders.

[HMS Queen Elizabeth]

What's worse, working 37.5 hours a week on a farm for £8.25 (£16k pa) or working a 0 hrs contract for JD Sports?

Working on a farm (as opposed to owning a farm) really used to suck. People would walk from farm to farm to be hired for a few days. That's the past equivalent of the zero hour contract. Zero hour is actually better since the placements are centrally coordinated so you have less work to do finding places, spend less time ultimately un or under employed. Day labour at shipyards, docks, and other traditional industries was also common. There really isn't an alternative to some people being employed this way, other than a higher standard rate of unemployment, which is surely worse whether you're a cappie or a commie.

Immigration doesn't "take" low paid jobs, it creates low paid jobs by expanding the low-competence component of the population: the proportion of the population that can only be profitably employed on a zero hour contract expands. Although that is probably not happening due to influx of E Europeans, it very likely is happening due to influx of Africans and some of the South Asian subgroups.

[Questers]

If Europe's financial markets leave London because of Brexit, where is the most likely place they would go?

Dublin?
Amsterdam?
Frankfurt?
Paris?

Frankfurt or somewhere else in Germany. The fate of the European economy and even that of the entire European Union rests upon German shoulders.

The fate of Europe has rested solely on German shoulders since 1871.

[HMS Queen Elizabeth]

If Europe's financial markets leave London because of Brexit, where is the most likely place they would go?

Dublin?
Amsterdam?
Frankfurt?
Paris?

It's not a well posed problem. What are "Europe's financial markets"? Financial instruments aren't strongly constrained by borders. The City conducts a lot of trade volume in US and Asian instruments - and the main reason it doesn't conduct a lot more is simply time zone differences.

The City grew large mainly because Britain was friendly towards it. To take its place, FR or DE would need to become constitutionally more favourable to finance. Not likely to happen.

[Questers]

What's worse, working 37.5 hours a week on a farm for £8.25 (£16k pa) or working a 0 hrs contract for JD Sports?

Working on a farm (as opposed to owning a farm) really used to suck. People would walk from farm to farm to be hired for a few days. That's the past equivalent of the zero hour contract. Zero hour is actually better since the placements are centrally coordinated so you have less work to do finding places, spend less time ultimately un or under employed. Day labour at shipyards, docks, and other traditional industries was also common. There really isn't an alternative to some people being employed this way, other than a higher standard rate of unemployment, which is surely worse whether you're a cappie or a commie.

Immigration doesn't "take" low paid jobs, it creates low paid jobs by expanding the low-competence component of the population: the proportion of the population that can only be profitably employed on a zero hour contract expands. Although that is probably not happening due to influx of E Europeans, it very likely is happening due to influx of Africans and some of the South Asian subgroups.

Sure, there will always be space for itinerant work. That's not what a zero hours contract is though. A zero hours contract is working for one person who doesn't have an obligation to tell you when you have to come in for workb before the time itself. Working for a month at the shipyard then going to the country to work at a farm for a month isn't the same thing at all, because those jobs provided steady, daily work for the time until that person was no longer needed. Then you could just get another job. In a past time this was facilitated by labour exchanges which were much better than the current jobcentre system which, in its current iteration, basically exists to provide some form of vetting for benefits.

The reason British people don't want to do these jobs is because they're poorly paid and they're (at least perceived to be) physically harder than making cocktails or stacking shelves, not because they only last for a few months in the year. Unemployed people will work jobs if they are offered one, regardless of its length of contract, because any job is better than being on JSA. We don't need to import migrants to work on our farms, we should just put our precariat to work there instead.

I agree with the latter paragraph.

[HMS Queen Elizabeth]

Working on a farm (as opposed to owning a farm) really used to suck. People would walk from farm to farm to be hired for a few days. That's the past equivalent of the zero hour contract. Zero hour is actually better since the placements are centrally coordinated so you have less work to do finding places, spend less time ultimately un or under employed. Day labour at shipyards, docks, and other traditional industries was also common. There really isn't an alternative to some people being employed this way, other than a higher standard rate of unemployment, which is surely worse whether you're a cappie or a commie.

Immigration doesn't "take" low paid jobs, it creates low paid jobs by expanding the low-competence component of the population: the proportion of the population that can only be profitably employed on a zero hour contract expands. Although that is probably not happening due to influx of E Europeans, it very likely is happening due to influx of Africans and some of the South Asian subgroups.

Sure, there will always be space for itinerant work. That's not what a zero hours contract is though. A zero hours contract is working for one person who doesn't have an obligation to tell you when you have to come in for workb before the time itself. Working for a month at the shipyard then going to the country to work at a farm for a month isn't the same thing at all, because those jobs provided steady, daily work for the time until that person was no longer needed.

But it was not 1 month, or at least not necessarily. People would go to labour exchanges and companies would fill their quota for the day and anyone not chosen that day would be turned away. 0H is itinerant labour made more efficient (which is good for both employee and employer) by modern telecommunications. Nothing more, nothing unprecedented.

Then you could just get another job. In a past time this was facilitated by labour exchanges which were much better than the current jobcentre system which, in its current iteration, basically exists to provide some form of vetting for benefits.

The reason British people don't want to do these jobs is because they're poorly paid and they're (at least perceived to be) physically harder than making cocktails or stacking shelves, not because they only last for a few months in the year. Unemployed people will work jobs if they are offered one, regardless of its length of contract, because any job is better than being on JSA. We don't need to import migrants to work on our farms, we should just put our precariat to work there instead.

I agree with the latter paragraph.

There are all sorts of jobs that people don't want to do, like pick up dog shit with your hands, and the result is that these jobs don't exist. Society would benefit, in some sense, from people doing that job, but society isn't willing to pay what it costs, so it just doesn't get done. A job does not have to exist. The availability of workers to do them, not the availability of jobs, is primary. If we had no low competence people in the country, and didn't subsidise it, agriculture might just disappear. What's the problem with that? I see no problem with it. What will not happen is that agriculture will start paying double wages.

[Questers]

But it was not 1 month, or at least not necessarily. People would go to labour exchanges and companies would fill their quota for the day and anyone not chosen that day would be turned away. 0H is itinerant labour made more efficient (which is good for both employee and employer) by modern telecommunications. Nothing more, nothing unprecedented.

I don't see how this is more efficient. The person is on constant call and if they're not being used by their employer on a given day they can't be used by another employer.

It's a different organisational system. You are saying that ZH is a labour exchange but with digital communications, but it isn't. A labour exchange with digital communications would do the same job as a labour exchange but allow people to find out before they actually get to the exchange and be sorted in that way.

The obvious benefit for an employer in ZH is that the person they have contracted can't work for their competitor if their competitor is short an employee. What we should do - which is what I said - is re-institute labour exchanges and use digital communications to sort people into available employment on that day.

There are all sorts of jobs that people don't want to do, like pick up dog shit with your hands, and the result is that these jobs don't exist. Society would benefit, in some sense, from people doing that job, but society isn't willing to pay what it costs, so it just doesn't get done. A job does not have to exist. The availability of workers to do them, not the availability of jobs, is primary. If we had no low competence people in the country, and didn't subsidise it, agriculture might just disappear. What's the problem with that? I see no problem with it. What will not happen is that agriculture will start paying double wages.

In the past there were many jobs close to picking up dog shit with your hands and the reason those jobs ceased to exist is because machines could do them instead. When machines can pour drinks or stack shelves (we are not far off from this), these jobs will cease to exist too, and that would be a good thing. Machines already cut the number of people who need to be employed in agriculture down to very few - perhaps if the workers disappeared, they would just be replaced with machines.

I think there are obvious reasons why it's good to maintain some kind of agriculture. You can probably intuit those list of reasons, so I don't need to post them, but you are right only in a vacuum. People need food to eat - and while it can be imported, that doesn't cater to all situations.

[HMS Queen Elizabeth]

But it was not 1 month, or at least not necessarily. People would go to labour exchanges and companies would fill their quota for the day and anyone not chosen that day would be turned away. 0H is itinerant labour made more efficient (which is good for both employee and employer) by modern telecommunications. Nothing more, nothing unprecedented.

I don't see how this is more efficient. The person is on constant call and if they're not being used by their employer on a given day they can't be used by another employer.

It's a different organisational system. You are saying that ZH is a labour exchange but with digital communications, but it isn't. A labour exchange with digital communications would do the same job as a labour exchange but allow people to find out before they actually get to the exchange and be sorted in that way.

The obvious benefit for an employer in ZH is that the person they have contracted can't work for their competitor if their competitor is short an employee. What we should do - which is what I said - is re-institute labour exchanges and use digital communications to sort people into available employment on that day.

It's more efficient to be given a call than to go to a building and wait around, and it's more efficient to be connected to a database of 1000 companies than stood in front of hiring representatives for 5 or 10. Both are quite inconvenient of course, but 0H is more efficient. I think 0H = labour exchanges, and that people who want to ban 0H probably would also have wanted to ban labour exchanges. I am not sure how your proposal substantively differs from 0H, though I do not disagree with it.

There are all sorts of jobs that people don't want to do, like pick up dog shit with your hands, and the result is that these jobs don't exist. Society would benefit, in some sense, from people doing that job, but society isn't willing to pay what it costs, so it just doesn't get done. A job does not have to exist. The availability of workers to do them, not the availability of jobs, is primary. If we had no low competence people in the country, and didn't subsidise it, agriculture might just disappear. What's the problem with that? I see no problem with it. What will not happen is that agriculture will start paying double wages.

In the past there were many jobs close to picking up dog shit with your hands and the reason those jobs ceased to exist is because machines could do them instead. When machines can pour drinks or stack shelves (we are not far off from this), these jobs will cease to exist too, and that would be a good thing. Machines already cut the number of people who need to be employed in agriculture down to very few - perhaps if the workers disappeared, they would just be replaced with machines.

I think there are obvious reasons why it's good to maintain some kind of agriculture. You can probably intuit those list of reasons, so I don't need to post them, but you are right only in a vacuum. People need food to eat - and while it can be imported, that doesn't cater to all situations.

But there still is dog shit on the streets, and we still could pick it up with our hands. For instance if the worker is too dumb to use a scoop. Or would break or lose the scoop every day or something. If people get dumb enough, it might happen (well, people that dumb will probably just not care about shit on the floor, but you know what I mean). That is the key point: are the people good enough to earn more. Except in the short term in response to large unexpected shocks, productivity of the worker determines wages, not demographics.

I mean sure we can subsidise agriculture for an internal food supply for strategic reasons, but that's separate to the employment question. If we do that, there might be more and better paid jobs in agriculture, but they will have come at the expense of other tasks not being done elsewhere, and national employment and wage rates won't change.

[Aelex]

Frankfurt or somewhere else in Germany. The fate of the European economy and even that of the entire European Union rests upon German shoulders.

The fate of Europe has rested solely on German shoulders since 1871.[/quote]
Probably explain why everything has went to shit since then. :^)

[Souseiseki]

Probably explain why everything has went to shit since then. :^)

it takes two to tango, as they say

[Questers]

What I think we should do about the precariat, and unemployment, is this.

Create a Labour Exchange with a computer system. Everyone who wants to work a shift reports to the Labour Exchange either at day or night. As jobs come in they are offered on a first-come-first-serve basis for those who have the relative abilities. After a period of time everyone left gets a municipal task (which might include picking up dog shit with a scoop, but Im not sure - if that was a widespread job, nobody would do it themselves.) Even in York, which is very clean, safe and prosperous, there is plenty of room for municipal tasks. Anyone who declines the first shift simply doesn't get the municipal work later.

At the same time we should replace JSA with unemployment insurance. The state pays everyone £1k p.a. into an unemployment insurance account and when you're unemployed you can access the balance from the post office or whatever. This way we have maximum employment and we have an insurance option for people who are transferring between sectors whatever. Then we can pay disability benefit to people who genuinely can't work. IMO the purpose of employment laws and (most) welfare laws should be to put people to work, not to provide for them while they are out of work.

[HMS Queen Elizabeth]

You are sounding remarkably cappie and imperialist.

[Questers]

You are sounding remarkably cappie and imperialist.

I don't think that's true - I'm talking about mandatory work for people who can work, or a public insurance system for people who want to transfer sectors or attempt entrepreneurship, and public social care for people who genuinely can't work. This is basic socialism in action.

[HMS Queen Elizabeth]

You are sounding remarkably cappie and imperialist.

I don't think that's true - I'm talking about mandatory work for people who can work, or a public insurance system for people who want to transfer sectors or attempt entrepreneurship, and public social care for people who genuinely can't work. This is basic socialism in action.

Socialism isn't well defined in this respect. Some people think socialism means a life of free stuff in a council house for whoever chooses it.

[Questers]

I don't think that's true - I'm talking about mandatory work for people who can work, or a public insurance system for people who want to transfer sectors or attempt entrepreneurship, and public social care for people who genuinely can't work. This is basic socialism in action.

Socialism isn't well defined in this respect. Some people think socialism means a life of free stuff in a council house for whoever chooses it.

I don't think this is true, though. People who think that just lack ambition.

They view it as: Whatever the Conservatives want, versus a life of free stuff in a council house for whoever chooses it. I don't view it as that choice. There is a third choice - mine.

[HMS Queen Elizabeth]

Socialism isn't well defined in this respect. Some people think socialism means a life of free stuff in a council house for whoever chooses it.

I don't think this is true, though. People who think that just lack ambition.

They view it as: Whatever the Conservatives want, versus a life of free stuff in a council house for whoever chooses it. I don't view it as that choice. There is a third choice - mine.

You seem to believe in something I will call, for want of a better label, Social Imperialism. I think most actual socialists would be horrified by the sort of "work for all who want it, the rest to the devil" attitude that you like, that the USSR liked, and that seems to be the only real alternative to the market (which does the same thing, just a bit differently, ultimately). I wouldn't strongly object to Social Imperialism.

[Questers]

I don't think this is true, though. People who think that just lack ambition.

They view it as: Whatever the Conservatives want, versus a life of free stuff in a council house for whoever chooses it. I don't view it as that choice. There is a third choice - mine.

You seem to believe in something I will call, for want of a better label, Social Imperialism. I think most actual socialists would be horrified by the sort of "work for all who want it, the rest to the devil" attitude that you like, that the USSR liked, and that seems to be the only real alternative to the market (which does the same thing, just a bit differently, ultimately). I wouldn't strongly object to Social Imperialism.

Well I think one of the big differences is who is actually fit for work, and one of the big objections to austerity is how it has treated disabled people.

At the moment we have a private company judging who is fit for work and they're contracted with the mission to reduce the number of people receiving disability benefits. Someone I know was signed off work by a medical professional for mental health reasons but then was deemed fit to work. If our people aren't fit for work we should look after them if their condition is permanent, or we should invest whatever we need to get them back to work.

Look, if you're in a wheelchair for some reason or one of your arms doesn't work or you have schizophrenia or something I don't think we need that person to work. The community can just look after them. It doesn't cost a lot of money for those people to live dignified lives. In a sense this is all insurance to us anyway because it could happen to our parents or our children or us.

But if you're a 25 year old male and you're offered a 30 hour job on minimum wage that you can quit at any time if you find something better and you turn it down then I don't have any sympathy. Rome wasn't built in a day - and it wasn't built by young men refusing to work either.

[Neu Leonstein]

That's my question - is EBA mainly a central banking agency that deals with issues related to the money supply, or mainly a private banking agency that deals with investment of private money? Those two are quite different. Frankfurt is more important for the first, but Paris (and maybe Amsterdam) probably more important for the latter.

The EBA is a regulator of private banks. They are basically a body that tries to write standardised rules for the whole EU on how to do prudential supervision of banks, and then works with the national prudential regulators to try and ensure that the rules are implemented consistently across countries. So they don't have anything to do with monetary policy, and they don't do any investing themselves.

The ECB also has a banking supervision department. Specifically, it organises the 'Single Supervisory Mechanism', which is the start of what is hoped to some time be the single supervisor for euro area banks. This is one of those quite significant pieces of reform that came out of the sovereign debt crisis, but that is generally not covered in the popular press.

Anyway, you see the overlap. Both have a similar final goal in mind, the EBA for the EU and the SSM for the euro area. I'm sure there are some subtle differences in what exactly they do in their day to day work, but they get together on all sorts of projects (e.g. the end of Banco Popular the other week). So to me there is some logic in making it easy for the two to work together by co-locating them. But as I said, I'm not that fussed.

If Europe's financial markets leave London because of Brexit, where is the most likely place they would go?

Dublin?
Amsterdam?
Frankfurt?
Paris?

New York.

The reality is that it's going to be a bit of everything. We don't know what will happen with euro clearing, but it seems unlikely (for better or worse) that it will stay in London. So there'll be job and profit and tax losses related to that. In addition, it also seems close to impossible that the UK will receive a pass on the rules that require broker dealers (and asset managers?) to market to clients in the EU, given the Brexit terms preferred by the UK.

But! This means first and foremost that the institutions that do this business have to be based in the EU. So the various European banks are already there - their London operations are strictly speaking just branches of the European units (in Paris, Frankfurt or wherever). For example the French banks, like BNP, SG or Calyon, might move some staff, but they won't be closing their offices in London or anything like that.

The bigger issue is for the American banks - they have subsidiaries in London, and then those subsidiaries have branches on the continent. That will have to flip to some extent, so they have to actually turn those branches into stand-alone subsidiaries that will be regulated directly by the European and relevant national regulators. But they can't just do that on paper: EU authorities have already said that they will need to actually see the substance of the business that is being done being located in the EU, including the relevant decision makers and staff.

That's why you've got offshore banks, like JPM, Citi, GS, MS, HSBC, Nomura et al announcing the various job movements away from London. Bloomberg has a handy tracker of the moves announced: https://www.bloomberg.com/graphics/2017-brexit-bankers/

But here's the deal: in recent years a lot of the American banks actually haven't been doing that well in the EMEA operations. Relative to their home and Asian offices, the returns have been more disappointing. They struggle against the bulk of the homegrown big banks in Europe. When there are complicated deals to be done, with high margins attached, they're there. But the big bulk flow business and corporate lending isn't necessarily their forte in Europe. So there are some who suggest that actually what'll happen is that they'll scale back their European operations generally, and just shift more business to New York instead. See more from the FT here.

Either way though, there are not going to be too many banks, European, American, Asian or otherwise, that will be looking to add to their London operations any time soon. That's ultimately why, in the words of the GS CEO, growth of London as a financial centre will stall for a while.

[Questers]

After a while, if someone leaves you, you realise you never needed them in the first place.

[Neu Leonstein]

By the way, who do you reckon 'senior Tory' is? I kinda wish it's Hammond: http://www.politico.eu/article/battered ... territory/

Two months earlier the Tories were heading for a landslide and relished the prospect of a generation in power. Now they were forced to endure the spectacle of an opposition leader, Jeremy Corbyn, long derided as a left-wing throwback, with his tail up.

Whitehall aides believe a crunch is coming — either for May or the Tory Party after they have got rid of her.

“This country is f–ked,” one senior Tory said. “We are tethered to the mast of Brexit and when it goes wrong we’re screwed. They all know it. All Labour have to do is hedge their bets. When the public realize they have been sold a pup they will turn on the party.”

And on the same issue, here's Schäuble:

"The Britons were endlessly lied to and deceived," Schaeuble told a conference of family-run companies. When the Brexit campaigners "happened to be successful, the ones who did it ran away because they said they can't take responsibility".

[Questers]

The number of people who voted Leave who were deceived is probably the same as the number of people who voted Remain were also deceived.