The Vote is out, Respect the Verdict!

Finally Britain has decided to leave EU and charter its own course. It was a passionate battle for both sides, and having listened to various arguments whether to remain or exit the EU, voters have given their verdict. Economically there would be short-term turmoil, but I think it will be contained with proactive policies from Central Banks and Politicians across the world. No one wants more instability. In my view it is positive for Britain to leave the EU. They can adjust their policies and respond better to external stimuli than EU where they were part of large block with umpteen stakeholders. I believe EU has to seriously consider what can be done to prevent the spread of contagion, It is very hard for EU to get all the countries to agree on fiscal targets, world has seen how difficult it is for Greece, Italy, Portugal and Spain to be bounded by fiscal targets where unemployment has run in double digit figures. Arguably in free market they could have responded by depreciating their currency, to increase the competitiveness ( which could have benefited exports and reduced exports ). In case of EU, they can’t respond resulting in massive underemployment and unemployment. EU shall have first pressed for Fiscal union than monetary union but that opportunity has passed. Secondly the argument about there would be massive job losses in city of London in Financial sector is an exaggeration at best. London is one of the best financial centers, and it has one of the best talent pool for jobs in financial sector. With Pound taking roughly 7% hit, it is cheaper as well. In my opinion it is not economically feasible for big financial institutions to move jobs out of London so easily. We have yet to see what the new agreements are between EU and London for movement of people across the border, and the arrangement of Multinational entities operating across the continent. Lets hope for the best for markets and people in UK.