tomacht8

Report from a German freight forwarder
The trucks drive back empty
About the Brexit is still negotiating. But the economy is already anticipating many consequences.

Achim Junker has already revised the plans of his drivers, recalculated their working hours, calculated their new routes. While representatives of the British government in Brussels are still negotiating how the exit of Great Britain from the EU is to take place, the forwarder from Blankenbach in Lower Franconia already provides facts. He sends fewer and fewer trucks towards the island. It used to be ten 40-tonners every week, the entrepreneur says, but now there are only four or five. "Some colleagues have already completely withdrawn from the market," says the entrepreneur.

No one yet knows what Brexit will look like at the end of the negotiations in March 2019, yet it is already casting its shadow ahead. Too vague are the ideas of Theresa May, as the Brexit and its proposed in Florence transitional solution should look like. Too unsure what kind of free trade agreement the EU will eventually reach with the British. The economy is reacting, trade between Germany and the United Kingdom is suffering. Exports from Germany to Great Britain, which had risen sharply after 2012, have been decreasing slightly since June 2016. At that time, the British voted for the exit. Conversely, exports from the UK to Germany have been particularly striking, from 1.65 million tonnes in June 2016 to 1.48 million in June 2017. And this despite the fact that the British pound has clearly lost value during this period - that would have actually need to boost British exports.

In Blankenheim, Achim Junker knows exactly why. The forwarder just has to think about his customers. In the past, his drivers drove to automotive suppliers in Aschaffenburg and Frankfurt, where they loaded parts such as fenders or other materials. From there, the trucks drove the semi-finished products hundreds of miles west, through Belgium, through France, to England. There, they delivered the products to companies that made car seats out of the materials or painted the fenders. The trade was so busy that the drivers fully loaded also returned to Germany. Junker's lorries lined up in a stream of three million trucks a year, shuttling between Britain and continental Europe to deliver goods. They are all part of tightly knit supply chains and production processes, which are difficult to re-allocate, but an example of what is possible when there are no customs duties and goods can be traded freely between countries - as in the EU's internal market.

But now? "The business is not running anymore," says Junker. One customer, a German company, switched immediately after the referendum on Brexit in the UK. "He was looking for producers in Eastern Europe at the next trade fair," says Junker, "so the business was gone for us." The entrepreneur observes that more and more companies in Germany are switching without hanging on to the big bell. The forwarder sees it on the websites of freight exchanges that he can access. At present, on the return trips from the UK to continental Europe, 67 percent of the cargo hold of the trucks are empty and only 33 percent are loaded with cargo, sometimes only 25 percent, he has observed. "The price for the outward journey can not be so good as to go back empty-handed," says Junker.

The economy, as experienced by the freight forwarder, anticipates the Brexit. There are still no tariffs, nor are there trade restrictions, nor is there a bureaucracy at the border. But because the German companies expect it, they are already looking for new customers and suppliers. Companies do not even want to risk having to shut down their machines just because a truck with components stuck in customs at the border.

Figures from the Federal Statistical Office show Junker's impressions: German exports to the United Kingdom fell by three percent in the first half of this year compared to the same period of the previous year. At the same time, exports to other EU countries increased by six percent. Trade in Europe is flourishing - business with Great Britain is stagnating.

And nothing happens that could provide confidence. Prime Minister May has not been able to point out a clear line in her speech in Florence; her cabinet is too divided.

If the UK leaves the European Economic Area and the Customs Union, exporters and importers have to complete extensive formalities, there will have to be border controls, trade agreements or not. That means additional costs and, depending on trade agreements, tariffs. A digital customs system, as the British imagine for the future, would be a novelty, nowhere in the world, has never been tested. In parliamentary committees, representatives of the ministries condescendingly admit to parliamentarians that they have no idea how such a system should be implemented at all.

Germany: Goldman Sachs plans with two major European offshoots after the Brexit
November 20, 2017, 11:50 am Source: afp

Paris (AFP) Goldman Sachs CEO, Lloyd Blankfein, has confirmed the plans of the US investment bank in Europe for the period after Brexit. Goldman Sachs will have "two European headquarters", one in Frankfurt am Main and one in Paris, said Blankfein to the French newspaper "Le Figaro" on Monday. Brexit forces the bank to "decentralize" its business. Frankfurt and Paris have been selected because Germany and France are the largest European economies.

34 minutes ago, nauseus said:

I'm sure that the EU will get what they fairly due, which is not 40B unless it includes extra for this "transition" period.

 

The EU slight growth is very recent and it won't last - still far too much debt and high risk of debt default in the EU. 

 

 

Yes, many European countries have high debts.
The UK currently has 1,89 trillion £ debt.
Is 29.672 £ per head (Debt per capita), Or  33.404 € (Debt per capita).
The UK has slightly less debt per capita than Greece (35.958 €) and slightly more than Austria (31.612 €).

1 hour ago, Khun Han said:

 

Because we're being messed about by remainers and Project Fear. The celebrations will come, quite literally, the minute we actually leave.

Oops, these 48% remainers, what a nasty group.

1 hour ago, Khun Han said:

 

The model does not work as you say. Try reading it in detail. And it is a model which is perfectly suitable to today's world.

Ok, i try to make Minfords theoretical model simple:

The 5 premises of the perfect market are:
1. unlimited reaction speed of the market to price changes
If a dealer of toilet paper at London Heathrow lowers its price for this good, all the demand for toilet paper will immediately fall to him, because he is the cheapest provider.

2. no personal preferences in the trade
If you buy your bread for breakfast, and you have the choice to make a purchase from a 22-year-old saleswoman with sexy long legs or an old unfriendly man. Where would you buy your bread? If the old mans bread would be 3 pence cheaper, nobody would buy bread from the girl.

3. no problems with geographical bridging.
If the cheapest provider for a commodity (let's say a lady vibrator) sits in Spain, all the British would go shopping there.

4. All market participants have the same information.
So, if the dealer for toilet paper in London Heathrow lowers his price, all Londoners would know that at the same time.

5. All goods are homogeneous.
Every natural product (lets say a banana) would then have to be identical,
in shape, color, material and decoration.
 

That's just a theoretical model.
The substantiated explanation for real trade can not and will not be provided by this model.
Minford always reflects his theoretical model on the practice against the background of the perfect market.
Believe it or not, Minford's publications are hardly quoted in serious economics science.
But in the SUN and Express you can read a lot about him.
But if the assumptions of the perfect market are valid, then Minford would be right.
All the British would buy there toilet paper in London Heathrow, would buy there bread from an old man, would buy there vibrators in Spain and would eat identical bananas.

Do not follow a blind man, if you have 86 men with each one eye around you.

 

2 minutes ago, Khun Han said:

 

The model does not work as you say. Try reading it in detail. And it is a model which is perfectly suitable to today's world.

Do not worry, have studied theoretical micro, macro and national economics accounts for years.
I had studied monetary policy and monetary theory with Otmar Issing.
Minford's theories are known to me.

38 minutes ago, Khun Han said:

 

https://theconversation.com/how-the-uk-can-benefit-from-a-free-trade-future-after-brexit-even-outside-the-single-market-84171

 

The article begins by explaining the history of the European customs union (German protectionism). It promotes the view that a Britain free of that protectionism and bureaucracy can flourish in free trade with the rest of the world.

 

The article then goes on to point out that economic forecasters got their post-referendum forecasts badly wrong, and posits that they got it wrong because they adhere to the 'gravity model' of economics, in which it's considered to be best practice to be as physically and culturally close to your favoured trading partners as possible. It's suggested that this is a fallacy, as shown by history: All of Britain's major trading partners in the nineteenth century were on the other side of the world (ok, different world now, I know), and Britain's exports to the EU have actually fallen in percentage in recent years.

 

The article then expands on the theory that a 'classical model' of Britain trading globally, free of assorted EU shackles and financial commitments, can see a 7% increase in GDP. For those who are genuinely interested in this, not just scoring points on internet fora, the economist Patrick Minford goes into great detail here:

 

http://brexitcentral.com/brexit-free-trade-critics-wrong-dismiss-classical-model/

Minford's assumptions are based on the perfect market model.

The 5 premises of the perfect market are:
1. unlimited reaction speed of the market to price changes
2. no personal preferences in the trade
3. no problems with geographical bridging.
4. All market participants have the same information.
5. All goods are homogeneous.

This is a 200 year old theoretical model.
But has nothing to do with the practice of the real economies on this planet.
 

1 minute ago, nauseus said:

You say harm. I say wellness. The harm was deviously inflicted 44 years ago.

Understand your view,
but i wonder why millions do not dance on the street with joy, fireworks everywhere, Brexit parties on mass, the sound of champagne glasses klicking, the spirit of a new departure everywhere?
I tend to see the opposite, everyone is moaning.
Even the 52% Brexiters are not all satisfied. Could it be that is there a lot of hassles right now?

9 minutes ago, Khun Han said:

 

https://theconversation.com/how-the-uk-can-benefit-from-a-free-trade-future-after-brexit-even-outside-the-single-market-84171

 

The article begins by explaining the history of the European customs union (German protectionism). It promotes the view that a Britain free of that protectionism and bureaucracy can flourish in free trade with the rest of the world.

 

The article then goes on to point out that economic forecasters got their post-referendum forecasts badly wrong, and posits that they got it wrong because they adhere to the 'gravity model' of economics, in which it's considered to be best practice to be as physically and culturally close to your favoured trading partners as possible. It's suggested that this is a fallacy, as shown by history: All of Britain's major trading partners in the nineteenth century were on the other side of the world (ok, different world now, I know), and Britain's exports to the EU have actually fallen in percentage in recent years.

 

The article then expands on the theory that a 'classical model' of Britain trading globally, free of assorted EU shackles and financial commitments, can see a 7% increase in GDP. For those who are genuinely interested in this, not just scoring points on internet fora, the economist Patrick Minford goes into great detail here:

 

http://brexitcentral.com/brexit-free-trade-critics-wrong-dismiss-classical-model/

Patrick Minford!
You can read about his scientific reputation everywhere.

https://www.economist.com/news/britain/21727078-patrick-minford-thinks-gdp-could-increase-68-most-economists-say-brexit-will-hurt

9 minutes ago, nauseus said:

You should be 

I am. It is not nice to joke about the harm of others,
even if the damage is self inflicted.

1 hour ago, aright said:

Neither is democracy.......its much more important than that and can't be left in the hands of recalcitrant Remainers.

26 minutes ago, Jip99 said:

 

 

 

It was a "close run result" when Mohamhed Ali beat Henry Cooper, it was a "close run thing" when England beat Germany 4-2 in 1966 and Blackpool won 4-3 in the 1953 FA Cup Final.

 

 

I didn't see Cooper, Germany or Bolton bleating like spoilt children saying if "only 635,000 people had voted the other way..."  IF, IF , IF !!

 

IF my Aunty had balls she would have been my uncle.

 

 

<deleted>, get a grip........... I am surprised to find someone as old as you who is so undemocratic.

Brexit is not a sports game.

From all your examples, are there any dangers or drastic changes for your life? Or do sports results change your life in a straight and long term, maybe over decades?
If so, Brexit vote was one Year a go, time for a rematch?
 

1 hour ago, Khun Han said:

So much for brexit squeezing UK inc's public budget:

 

http://www.bbc.co.uk/news/uk-politics-42034392

Do not worry there is enough money.
If the UK ever started taxing all its super-rich, taxrefugees , tax evaders, and offshore letterbox residents properly, the UK would be swimming in money and there would be more left over for the public.

Look at the GINI coefficient, the unequal distribution between poor and rich,
The unequal distribution of income.
That would certainly be the lever.
But this topic, many Brexit politicians does not like it at all.

1 hour ago, Khun Han said:

 

And exponentially the biggest reason for the mess is remain refusing to accept the decision to leave, and undermining the government on it at every turn.

A real step forward.
The first time that the EU is not portrayed as a responsible culprit.
Now slowly the word BREXIT gets a content.
And this content is rich in facets like a kaleidoscope.
This extends from: throwing all foreigners out of the country, own border controls, paying no divorce costs, over a transition period, having a new trade deal, to remaining in the common market, continue to maintain good relations with the EU, paste and copy EU laws, but, ......
And all this coupled with a time pressure and time limit, within reasonable solutions can not be realized.
Have already posted in another thread how long normally new trade agreements take until they are signed.
The UK negotiators seem to forget that they are negotiating with 27 states at the same time and that's system conditionally, time-consuming.
The whole thing is a bit like Nena's song: 99 Balloons.
And every balloon is a new idea that is released daily by the UK politicians.
Even the Brexiters do not agree on what kind of brexit they really want.

25 minutes ago, CG1 Blue said:

If they veto the deal that's on the table, then we have no deal.  What then?

 

Maybe you think the EU (all 27 members) would allow us to reverse Article 50 and remain in the EU under the same terms we had before. I highly doubt that. Unless of course they all realise the EU will collapse without the UK's funding...

 

Technically we all know referendums are advisory, but we all know the result is binding in this case. That was made absolutely clear before, during and after the referendum.

no worries. the best strategic eu bureaucrats are still counting. a brexit could also mean a profit for the EU. but would contradict the philosophy of an united Europe. somehow it has to go on.

On 10.11.2017 at 5:55 PM, mfd101 said:

An obvious question is: Why would the EU want Britain back anyway?

 

Of course there is some loss to the EU with Britain's departure - strategically as against the other great powers, and economically (though nothing compared to the economic damage Britain is already doing to itself) - but there is also considerable gain longterm in losing a fractious member that whines the whole time, always demands special deals on everything and generally makes arriving at agreements for action much more difficult than it should be.

Absolute. After a decade-long UK blockade, it's a wonderful opportunity to smash the British offshore tax havens and tax avoidance islands. The additional tax revenue would be much higher than the UK's annual EU contribution.

33 minutes ago, simoh1490 said:

ANY Brexiteer, please tell us (the Remain position on these points is already known):

 

What are the tangible beneifts to the UK as a whole, of Brexxit.

 

What will be the impact of Brexit on the UK economy during the first five and ten years, will it grow or will it shrink

 

What will happen to the Pound vs USD exchange rate, will it rise, fall or remain the same, ranges will do.

 

Will immigration numbers drop more than 10%

 

Will the NHS get more funding or less as a result of Brexit.

 

Will Brexit cause taxes to rise, fall or remain the same.

 

 

They UK will get less food safety, less health-, labor- and environmental protection and more chlorine chicken, hormone cattle, genetically modified crops and much more longer waiting times for plumbers.

Brexit is also the attempt 

to save the British their opaque money offshore system for the rich and the companies with tax avoidance intent.

Incidentally, the overseas territories are led by Foreign Minister Boris Johnson, the most prominent Brexit advocate in the Cabinet - and for the Channel Islands and Isle of Man, Justice Minister David Lidington, a former Remainer who changed his faith in the summer and changed to the EU opponents camp. 

As one result, Formula One World Champion Lewis Hamilton did not have to pay import tax on his Canadian-owned Bombardier private jet, which he imported through the Isle of Man.

The "Paradise Papers" show that many Brexit hardliners, especially the Conservatives, hate any financial regulation from Brussels. It is a disruptive factor for the British offshore system. Reason enough for EU skepticism and withdrawal thoughts. If they talk about global free trade, then they do not mean goods - but money, financial flows, the offshore system. A minor blow to the offshore system would be the Black List of tax havens promised by the European Commission by the end of the year. 

That the brexit has the intention to help the normal uk citizens to make better meats end, is an illusion.

So the hard-working and tax-paying Polish plumber is the enemy of Brexiters and not people like Michael Ashcroft, who didn't paid for his billion income any tax since many years.

1 hour ago, CG1 Blue said:

I think it would be a wider margin than 60/40 to leave now.  Perhaps more like 70/30.

 

The EU ministers have shown their true colours since June 2016, with threatening tactics, outrageous demands (e.g.€100bn divorce bill), plus the recent announcements from Juncker suggesting he wants an EU armed forces in place asap (something that was always denied by the Remain side).

 

I'd be happy to have another referendum, because I know the result would be a much more resounding vote leave. The trouble is this just wastes more time and tax payers money.  

The UK should better hold a referendum on the abolition of all taxes. There is certainly a large majority of the population to be expected. That the whole is not based on a plan, it certainly does not hurt as you can see in the perfect execution of the brexit.

6 minutes ago, Dagnabbit said:

It takes the EU 7 years for a trade deal...

Which is one of the reasons the UK voted leave...

Sent from my SM-A720F using Tapatalk
 

I think Nigeria is faster if you grease the right hands.

... even though we expect to conclude a deep and special partnership (with the EU)," he told parliament.

Until march 2019?

That is technically impossible. The development of tailor-made trade agreements lasts 7-10 years.

EU-Canada needed 8 years.

EU-Japan needed also around 8 Years. 

Another problem is the lack of UK-based trade experts. 

In the past, Brussels has developed trade agreements for the EU. For example, the eu-canada agreement involved 800 experts on the EU side and 600 on the canadian side

The UK has currently not enough of these professionals.

The uk has decided on the fixed expiration date actually the hard brexit.

instead of constantly selling rosy air, the population should be given clear information.But I fear the government does not recognize the consequences of its decisions.

12 hours ago, baansgr said:

Its becoming clearer everyday how the EU is really run and that they need UK far more than the UK need them. Greedy little facists trying to get as much as possible for themselves befor the boat sinks.

Its really irrelevant what a few people on here think about the situation and the misinformed rubbish they spout.

UK is leaving the EU for a better future. Even the facist rag Guardian have admitted that more remainers would vote leave now.

LOL

The 171 UK delegates for more than 40 years were involved in creating the eu dinosaurus and now they are complaining about it.

Sorry but that is stupid.

3 minutes ago, Grouse said:

Dyson, arch Brexiter, was on Andrew Marr. He favours abolishing corporation tax and relaxing hire and fire rules. But he wants to make everyone Engineer's and technologists just like Singapore.

 

Not looking good for the munchkin Brexiters! All that mathematics! 

Dyson is like a snake with a split tounge. 

 He cries out British nationalism but invests his UK profits in Singapore.

16 hours ago, melvinmelvin said:

 

re sums it up, received this from a friend:

 

Dave Davis is at the golf club returning his locker key when Mr Barnier the membership secretary sees him.

"Hello Mr Davis," says Mr Barnier. "I'm sorry to hear you are no longer renewing your club membership, if you would like to come to my office we can settle your account."

"I have settled my bar bill," says Mr Davis.

"Ah yes Mr Davis," says Mr Barnier, "but there are other matters that need settlement."

In Mr Barniers office Mr Davis explains that he has settled his bar bill so wonders what else he can possibly owe the Golf Club? "Well Mr Davis," begins Mr Barnier. "You did agree to buy one of our Club
Jackets."

"Yes," agrees Mr Davis. "I did agree to buy a jacket but I haven't received it yet. As soon as you supply the jacket I will send you a cheque for the full amount."

"That will not be possible," explains Mr Barnier. "As you are no longer a club member you will not be entitled to buy one of our jackets!"

"But you still want me to pay for it,"  exclaims Mr Davis.

"Yes," says Mr Barnier. "That will be £500 for the jacket. There is also your bar bill."

"But I've already settled my bar bill." says Mr Davis.

"Yes," says Mr Barnier, "but as you can appreciate, we need to place our orders from the Brewery in advance to ensure our bar is properly stocked." "You regularly used to spend at least £50 a week in the bar so we have placed orders with the brewery accordingly for the coming year." "You therefore owe us £2600 for the year."

"Will you still allow me to have these drinks?" asks Mr Davis. "No of course not Mr Davis. You are no longer a club member!" says Mr Barnier.

"Next is your restaurant bill," continues Mr Barnier. "In the same manner we have to make arrangements in advance with our catering suppliers. Your average restaurant bill was in the order of £300 a
month, so we'll require payment of £3600 for the next year."

"I don't suppose you'll be letting me have these meals either?" asks Mr Davis.

"No, of course not," says an irritated Mr Barnier "You are no longer a club member!"

"Then of course," Mr Barnier continues, "there are repairs to the clubhouse roof."

"Clubhouse roof,” exclaims Mr Davis. "What's that got to do with me?"

"Well it still needs to be repaired and the builders are coming in next week, your share of the bill is £2000."

"I see," says Mr Davis, "anything else?"

"Now you mention it" says Mr Barnier, "there is Fred the Barman's pension. We would like you to pay £5 a week towards Fred's pension when he retires next month. He's not well you know so I doubt we'll need to ask you for payment for longer than about five years, so £1300
should do it. This brings your total bill to £10,000," says Mr Barnier. "Let me get this straight," says Mr Davis. "You want me to pay £500 for a jacket you won't let me have, £2600 for beverages you won't let me drink and £3600 for food you won't let me eat, all under a roof I won't be allowed under and not served by a bloke who's going to retire next month!"

"Yes, it's all perfectly clear and quite reasonable," says Mr Barnier.

"Piss off!" says Mr Davis

Now we understand what Brexit is all about.

LOL

i like this analogy, but brexit is not that simple. First. what if davis in your hypothetical golf club had previously determined the rules and signed in the past the brewers' orders and the roof repair ahead of time for years in advance together with all club members?

Secondly: Davis wants to leave the club, does not want to pay for the club membership, but still wants to use the golf course? For free then? Or a privileged tailormade membership? An extra sausage only for davis? And the whole please very fast? If all of the golf club members acted so irresponsibly, the golf club could close and nobody could play anymore golf. 

Here is just one example of long-term commitments and the uk can not just steal out there for free.

The Relocation of the EU Medicines Agency from London could be expensive. According to a document of the European Parliament, the lease of the EU authority, which is expected to leave Great Britain in the wake of Brexit, will run until 2039. Until then, a total rent of 347.6 million euros is due and the contract does not contain an opt-out clause , The members of the Committee on Budgetary Control had noted this with concern, according to a summary of their audit report.

60 billion are a bargain.

Instead of negotiating this with a 6-year transitional period and allowing a good brexit for both sides, including a tailor-made trade agreement and allowing the companys planning horizons, the uk tries to achieve a hard brexit with the crowbar, which does not benefit anyone. The negotiations are currently characterized by an incredibly stupid short-term planning horizon.