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Grexit , Brexit ....how will it hit you ?

10th Feb 2015
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I have long advocated both the above , and whilst the former is something most experts deem necessary there is a lot of debate over the impact of the latter

To be honest I haven't really given any serious thought as to how it will impact my business , and what drives my thought is the stifling and often irrational EU rules that Brussels spews out like ticker tape

What about you and your clients ?

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Replies (4)

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Locutus of Borg
By Locutus
15th Feb 2015 21:13

Two different things

Grexit and Brexit are two different things.

Greek exit from the Euro (and default on all debts) is probably essential before that economy can really get back on its feet, as it cannot really compete in the stranglehold of the Euro and the weight of external debt.  However, there will be an extremely painful transition for them in the short to medium term, with the economy shrinking perhaps by another 25%.  The Germans will be hoping that Spain, Portugal and Italy take careful note.  Unless there is major contagion, I doubt whether we will see much direct impact over here.

British exit from the EU would have a profound effect on many aspects of our economy, both positive and negative.  I'm unsure which way I would vote, myself.  One certainty would be that it would reignite the Scottish Independence debate.  EU exit will affect many businesses in one way or another, be it VAT or various other EU directives that a "free" Britain may choose to continue with or not.  Just be thankful we never joined the Euro.

At the moment, Grexit looks much more likely than Brexit.

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Norman Younger
By Norman Younger
17th Feb 2015 14:13

2 exits

Indeed they are very different creatures

My view is that it is impossible to predict with accuracy what will happen on a micro level for individual firms

There will be market turmoil until it became clear who the winners and losers would be

But how many clients will actually go bump quickly as an immediate effect of either ?

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By Knight Rider
17th Feb 2015 16:02

Empowerment

Perhaps a Brexit would be followed by a tremendous sense of empowerment by individuals and businesses who feel free to act without the dead weight of European legislation standing in their way. The ending of discrimination against immigrants from outside the EU would end and trading ties with Commonwealth countries would strengthen. A new sense of optimism could send markets to new highs.

A Grexit on the other hand would give rise to some market volatility in the short term as speculation about the next countries to leave the euro and default on debt spook the markets. Once the eurozone has shrunk to a sustainable area Europe's economies may become more dynamic and outward looking sending markets to new highs.

However UK businesses operating in the UK probably won't benefit significantly from either. 

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By User deleted
19th Feb 2015 08:05

Goldman Sachs Question / Solution …

Of course one of the elephants in the room is:

Goldman Sachs part in ensuring Greece joined the EU in the first place, when in fact on the countries figures this should never have been allowed

Greece with the help of Goldman Sachs 'cooked the books' by masking the true extent of Greek debt by the use of derivatives to 'legally' circumvent the EU Maastricht rules. Thereby deferring the cross-currency swaps maturity until after Greece had entered the EU and then bringing the problem back on Greece's books to increase the countries already bloated deficit

Once the Greece/Goldman 'scam' became apparent WHY did no-one in the EU do anything about either throwing them out of the EU or ensuring that Goldman Sachs under-wrote the liability of the Greek participation in perpetuity

And it’s still not too late – so the EU needs to send Goldman Sachs the bill for fraudulently assisting Greece join the EU. This would have a twofold effect –

get rid of that appalling ‘octopus tentacle’ (just look at the role call of their ex employees) vulture firm of Goldman Sachs -http://en.wikipedia.org/wiki/List_of_former_employees_of_Goldman_Sachsmitigate Greek debt to the EU/IMF etc.

So why has this never been addressed?

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