Brexit: a view from the road
In the last couple of months, I’ve travelled the country presenting my investment views on Brexit to hundreds of IFAs at seminars and conferences. While the thoughts and opinions of the audiences have varied significantly, one factor has united them all: the acknowledgement that the outcome of this referendum is incredibly important.
So, as the vote is now just six days away and to conclude my series of Brexit blogs, I thought I’d share some of the main talking points I’ve had while out on the road – I’ll leave you to decide what they may suggest for next week’s vote.
The salient factors for deciding on whether we’re better off in or out of the EU can be boiled down to five areas:
- Financial contributions and benefits
- Future foreign direct investment flows
- Trade and tariffs
- Financial services.
Many of these are misunderstood; shrouded in misinformation by both the ‘remain’ and ‘leave’ campaigns. We’ve dug beneath the surface of these issues and have been basing our Brexit presentations on the reality, rather than the rhetoric.
Without a doubt, immigration was the tinderbox that ignited most audiences. Britons are traditionally reluctant to talk about this subject, but this wasn’t the case out on the road. So when I presented the economic evidence that EU migration has actually boosted UK GDP, I could see people’s hackles rise. I’ve never been heckled before, so I had to adapt quickly - having the benefit of a microphone does gives you an edge. I was confronted by quite a few animated delegates who at best questioned official statistics and at worst aired sentiments that some could view as distasteful.
Concerns were raised about Turkey’s ascension to the EU and its potential for mass migration. In reality, the country is probably decades away from joining the EU unless the rules change significantly.
I did find that the further I travelled from London, the more eurosceptic the audience became – 50/50 in the regions, 70/30 in London.
While most of my presentations were to financial advisers, my final presentation was to a group of Devonshire businesspeople. Before my presentation, the room was 52% remain and 48% leave. At the end, 55% voted in favour of exiting, while 45% wanted to stay - this was despite my pro-immigration message.
It appears that when you strip away the rhetoric more people are inclined to vote to leave.
One mortgage adviser asked me if I thought interest rates would rise if we leave (for the record, I think rates will fall). If so, he said he would vote remain. He was apologetic (an interesting nuance), but said this could undermine the housing market and ultimately affect his livelihood. His vote was down to an issue that was most relevant to him and for most people, there is probably one key reason that resonates with them that will ultimately sway their vote.
The main trend I noticed was that the number of people voting to leave after my presentations tended to rise, despite the fact that they were intended to be neutral presentations of the facts. We also discussed the potential ‘Plan B’ should we leave, given there was no real detail on this from either campaign.
In a nutshell, ‘Plan B’ is probably easier monetary and fiscal policy to encourage business expansion and retain and then attract new foreign capital. This, together with strong governmental leadership, will be needed to restore the confidence that will surely erode if we leave. We will also almost certainly be staring down the barrel of a cut to our sovereign credit rating.
It has been great presenting on a subject that stirs such widespread and inclusive debate and I’ve certainly learned new skills in managing audience dissent - having said that, I’m now well and truly Brexited out...!
To think, after 23 June, come what may, we can move on to the race for the US presidency. My autumn roadshows will probably be titled Trumponomics: walls and protectionism.