Wry & Dry

Brexit! Biggest political & economic event since Soviet Union fall

The Brits have just democratically voted for the biggest political and economic event since the collapse of the Soviet Union.  Which, in itself, was another example of the will of the people overturning the will of the political elite.

The ramifications of this vote are enormous.  And will be exaggerated, especially over the next few days.

The share-market, including dividends, is now showing a 0% return for FY-16.  First Samuel clients' share portfolios are showing close to double digit returns.  

First Samuel clients can also be comforted in the strong defensive positions and high cash weighting in their portfolios.  

We will email a special edition of Wealth Intelligence on Monday, explaining, clearly and rationally, how client portfolios are structured.

As for the referendum, the Brits have lurved all the attention.  The Union flag hasn't appeared in the global media this much since The Beatles.

Brexit again

But it's now all over.  The best of it is that the Brits followed Wry & Dry's advice.  And voted to Leave.  W&D is especially disappointed with the folk of Gibraltar, who voted 95.9% to Remain.

With the Brexit vote as clear as it was, W&D has to ask the question:

With the four major political parties; ten of the 'world's leading economists', the City of London (i.e. the financial hub); the Bank of England; the leaders of all European countries; the British Confederation of Industry, the Trades Union Congress and even David Beckham and that most craven of politicians (Obama) all urging the UK to Remain, how was it that the Brits voted to ignore them all?

This is really a disaster for politicians.  And a disaster for Europe.  The Brits really do not see themselves as European, and that's that.  

Now that W&D has got that off his hairy chest, this week W&D looks at another upcoming voter choice.  And eyes the Australian federal election with two comments: With odds at $5.50, W&D will put money on Labor to win the election; W&D predicts that the winner of the election will be ... South Australia; moving offshore, a bigger Panama Canal is soon to open but what about the Nicaragua Canal? And from investment grade to bankruptcy in 4 months.  Time to rate the rating agencies.  

What W&D won't discuss this week is that it is possible that neither Trump or Clinton win the election.  

In a real black swan event, it is possible that neither gain the 270 Electoral College votes required for presidency - because Gary Johnson, the third candidate for US Presidency, wins New Mexico, where he was once governor.  Good grief.  W&D will explain next week (by which time, no doubt, the Australian media would have picked up the story from W&D).

Follow The Money updates the odds on both the Australian and US elections, with the overall Australian outcome not matched by the sum of the betting on individual seats.  

And, of course, Miscellany, to soothe your troubled mind.

Our sister publication, Investment Matters notes that the stock-market had a wild week, is down over 3% today, and is heading for a 0% return for FY-16.   And First Samuel invested in a new company, see the details.  As well as other investment insights.

Read on, wryly and dryly.