The Brits Exit Shakes Global Markets By Ed Fulbright

The Brexit Shakes Global Markets

A worldwide selloff occurs after the United Kingdom votes to leave the European Union.

Provided by Ed Fulbright, CPA, CGMA, PFS

A wave of anxiety hit Wall Street Friday morning. Thursday night, the United Kingdom elected to become the first nation state to leave the European Union. The “Brexit” can potentially be finalized as soon as the summer of 2018.¹

  

Voters in England, Scotland, Wales, and Northern Ireland were posed a simple question: “Should the United Kingdom remain a member of the European Union or leave the European Union?” Seventy-two percent of the U.K. electorate went to the polls to answer the question, and in the final tally, Leave beat Remain 51.9% to 48.1%.^2,3

   

The vote shocked investors worldwide. The threat of a Brexit was supposed to have decreased. As late as Thursday, key opinion surveys showed the Remain camp ahead of the Leave camp – but at 10:40pm EST Thursday, the BBC called the outcome and projected Leave would win.⁴

  

Why did Leave triumph? The leaders of the Leave campaign hammered home that E.U. membership was a drag on the U.K. economy. They criticized E.U. regulations that impeded business growth. They felt that the U.K. should no longer contribute billions of pounds per year to the E.U. budget. They had concerns over E.U. immigration laws, which permit free movement of people among E.U. nations without visas.¹

      

Financial markets were immediately impacted. The pound fell almost 11% Thursday night to a 31-year low, and the benchmark U.K. equities exchange, the FTSE 100, slipped 5% after initially diving about 8%. Germany’s DAX exchange and France’s CAC-40 exchange respectively incurred losses of 7% and 9%. In Tokyo, the Nikkei 225 closed nearly 8% lower, taking its largest one-day slide since 2008.⁵

   

Stateside, S&P 500 and Nasdaq Composite futures declined more than 5% overnight; that triggered the Chicago Mercantile Exchange’s circuit breaker, briefly interrupting trading. The Chicago Board Options Exchange Volatility Index, or CBOE VIX, approached 24 after midnight. The price of WTI crude fell more than $2 in the pre-dawn hours.^5,6

At the opening bell Friday, the Dow Jones Industrial Average was down 408 points. The Nasdaq shed 186 points at the open; the S&P, 37 points.⁷

Fortunately, the first trading day after the Brexit referendum was a Friday, giving Wall Street a pause to absorb the news further over the weekend.

How could the Brexit impact investors & markets going forward? Consider its near-term ripple effect, which could be substantial.

The Brexit could deal a devastating blow to both the United Kingdom and the European Union. Depending on which measurements you use, the E.U. collectively represents either the first or third largest economy in the world. In terms of international trade, its import and export activity surpasses that of China (and that of the United States).²

An analysis by the U.K.'s Treasury argued that the country would be left “permanently poorer” by the Brexit, with less tax revenue and lower per-capita GDP and productivity. The Brexit certainly hurt the U.K.’s major trading partners, which include China, India, Japan, and the United States. Some Chinese and American companies have established operations in the U.K. specifically to take advantage of its E.U. membership and the free trade corridors it opens. With the U.K. exiting the E.U., the profits of those firms may be reduced – and the U.K. will have to quickly negotiate new trade deals with other nations. The most recently available European Commission data shows that in 2014, U.S. direct investment in the E.U. topped €1.8 trillion (roughly $2 trillion), with a slightly greater amount flowing back to the U.S.²

  

You could also see a sustained flight to the franc, the yen, and the dollar in the coming weeks. The stronger the dollar becomes, the weaker the demand for American exports.

  

Investors should hang on through the turbulence. The Brexit is a historic and unsettling moment, but losses on Wall Street should be less severe than those happening overseas. Retirement savers should not mistake this disruption of market equilibrium for the state of the market going forward. A year, a month, or even a week from now, Wall Street may gain back all that was lost in the Brexit vote’s aftermath. It has recovered from many events more dramatic than this.

  

Please call Ed Fulbright at 919-354-0368 or edf@moneyful.com  if you have questions about your specific situation.

 

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

   

Citations.

1 - bbc.com/news/uk-politics-32810887 [6/23/16]

2 - cnbc.com/2016/06/21/uk-brexit-what-you-need-to-need-to-know.html [6/24/16]

3 - bbc.com/news/politics/E.U._referendum/results [6/23/16]

4 - bbc.com/news/live/uk-politics-36570120 [6/23/16]

5 ­- nytimes.com/aponline/2016/06/24/world/asia/ap-financial-markets.html [6/24/16]

6 - rE.U.ters.com/article/us-usa-stocks-idUSKCN0Z918E [6/24/16]

7 - marketwatch.com/story/us-stocks-open-sharply-lower-joining-global-post-brexit-selloff-2016-06-24 [6/24/16]

The Brits Exit Shakes Global Markets By Ed Fulbright

The Brexit Shakes Global Markets

A worldwide selloff occurs after the United Kingdom votes to leave the European Union.

Provided by Ed Fulbright, CPA, CGMA, PFS

A wave of anxiety hit Wall Street Friday morning. Thursday night, the United Kingdom elected to become the first nation state to leave the European Union. The “Brexit” can potentially be finalized as soon as the summer of 2018.¹

  

Voters in England, Scotland, Wales, and Northern Ireland were posed a simple question: “Should the United Kingdom remain a member of the European Union or leave the European Union?” Seventy-two percent of the U.K. electorate went to the polls to answer the question, and in the final tally, Leave beat Remain 51.9% to 48.1%.^2,3

   

The vote shocked investors worldwide. The threat of a Brexit was supposed to have decreased. As late as Thursday, key opinion surveys showed the Remain camp ahead of the Leave camp – but at 10:40pm EST Thursday, the BBC called the outcome and projected Leave would win.⁴

  

Why did Leave triumph? The leaders of the Leave campaign hammered home that E.U. membership was a drag on the U.K. economy. They criticized E.U. regulations that impeded business growth. They felt that the U.K. should no longer contribute billions of pounds per year to the E.U. budget. They had concerns over E.U. immigration laws, which permit free movement of people among E.U. nations without visas.¹

      

Financial markets were immediately impacted. The pound fell almost 11% Thursday night to a 31-year low, and the benchmark U.K. equities exchange, the FTSE 100, slipped 5% after initially diving about 8%. Germany’s DAX exchange and France’s CAC-40 exchange respectively incurred losses of 7% and 9%. In Tokyo, the Nikkei 225 closed nearly 8% lower, taking its largest one-day slide since 2008.⁵

   

Stateside, S&P 500 and Nasdaq Composite futures declined more than 5% overnight; that triggered the Chicago Mercantile Exchange’s circuit breaker, briefly interrupting trading. The Chicago Board Options Exchange Volatility Index, or CBOE VIX, approached 24 after midnight. The price of WTI crude fell more than $2 in the pre-dawn hours.^5,6

At the opening bell Friday, the Dow Jones Industrial Average was down 408 points. The Nasdaq shed 186 points at the open; the S&P, 37 points.⁷

Fortunately, the first trading day after the Brexit referendum was a Friday, giving Wall Street a pause to absorb the news further over the weekend.

How could the Brexit impact investors & markets going forward? Consider its near-term ripple effect, which could be substantial.

The Brexit could deal a devastating blow to both the United Kingdom and the European Union. Depending on which measurements you use, the E.U. collectively represents either the first or third largest economy in the world. In terms of international trade, its import and export activity surpasses that of China (and that of the United States).²

An analysis by the U.K.'s Treasury argued that the country would be left “permanently poorer” by the Brexit, with less tax revenue and lower per-capita GDP and productivity. The Brexit certainly hurt the U.K.’s major trading partners, which include China, India, Japan, and the United States. Some Chinese and American companies have established operations in the U.K. specifically to take advantage of its E.U. membership and the free trade corridors it opens. With the U.K. exiting the E.U., the profits of those firms may be reduced – and the U.K. will have to quickly negotiate new trade deals with other nations. The most recently available European Commission data shows that in 2014, U.S. direct investment in the E.U. topped €1.8 trillion (roughly $2 trillion), with a slightly greater amount flowing back to the U.S.²

  

You could also see a sustained flight to the franc, the yen, and the dollar in the coming weeks. The stronger the dollar becomes, the weaker the demand for American exports.

  

Investors should hang on through the turbulence. The Brexit is a historic and unsettling moment, but losses on Wall Street should be less severe than those happening overseas. Retirement savers should not mistake this disruption of market equilibrium for the state of the market going forward. A year, a month, or even a week from now, Wall Street may gain back all that was lost in the Brexit vote’s aftermath. It has recovered from many events more dramatic than this.

  

Please call Ed Fulbright at 919-354-0368 or edf@moneyful.com  if you have questions about your specific situation.

 

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

   

Citations.

1 - bbc.com/news/uk-politics-32810887 [6/23/16]

2 - cnbc.com/2016/06/21/uk-brexit-what-you-need-to-need-to-know.html [6/24/16]

3 - bbc.com/news/politics/E.U._referendum/results [6/23/16]

4 - bbc.com/news/live/uk-politics-36570120 [6/23/16]

5 ­- nytimes.com/aponline/2016/06/24/world/asia/ap-financial-markets.html [6/24/16]

6 - rE.U.ters.com/article/us-usa-stocks-idUSKCN0Z918E [6/24/16]

7 - marketwatch.com/story/us-stocks-open-sharply-lower-joining-global-post-brexit-selloff-2016-06-24 [6/24/16]

2016-06-19 Building Family Wealth with Kimberly Palmer and Ed Fulbright on Mastering Your Money Radio

Kimberly Palmer

For many women, life’s greatest source of financial stresses comes with motherhood. While struggling to keep up with all the new expenses, from diapers and baby food to child care, moms feel the pressure to save for big future goals, like college tuition, and provide a cushion for unexpected events, like a layoff or illness. Then, there are those tough money-and-work related questions: how much time should I take off after my baby is born? Can I afford an unpaid maternity leave? Will I be able to commit the same ambition to my career with a kid? What if I want to work from home or part-time?

 Joining us for our discussion on Building Family Wealth is Kimberly Palmer who is calling in from her Washington state office .  She was the senior money editor at US News & World Report for nine years. She is an adjunct professor at American University, where she teaches a course on mastering social media. She has appeared on NBC’S TODAY, CNBC, and CNN. She is the author of “Smart Mom Rich Mom: How To Build Wealth While Raising A Family ”

2016-06-12 Networking Like A CEO with Leon Shapiro & Ed Fulbright on Mastering Your Money Radio

Leon Shapiro

While in college I had the opportunity to meet the CEOS of Chase Manhattan Bank and CNA Insurance.  At 20 years old I was fascinated with how down to earth yet how powerful these executive were and as i escorted them from the student union to the auditorium to speak they all mentioned how important it was to have a solid network of colleagues and successful people around you to help you not just advance in your career but in life.

Joining us for our discussion On How To Network Like A Successful CEO  is Leon Shapiro    who is calling in from his San Diego Office .  Leon Shapiro has served as a CEO of one of the leading peer advisory membership organizations , Vistage Worldwide and currently serves on their board of directors.  Prior to that he was an executive at Warner Music Group, NPD And Gartner Inc.

His  latest book is “The Power Of Peers: How The Company You Keep Drives Leadership, Growth & Success.”

2016-06-05 Change Your Future By Voting With James M. Stone and Ed Fulbright on Mastering Your Money Radio

James M.Stone

Since I was first able to vote, I have gone to the election booth and voted.  I used to think my vote did not count until one time I thought I might not vote since I was going to be out of town on election day.  I decided to take break from work and go to the election office to vote early and cast my vote.   In the local election, one of the people I supported won by only 3 votes.  Your vote does count and your voice counts too.

Joining us for our discussion on Change Your Future With Your Vote is James M. Stone      who is calling in from his Boston Ma office .  James M. Stone is the founder, chairman, and CEO of the Plymouth Rock Group of companies. He began his career teaching financial economics at Harvard, after earning his PH.D. there. He served as Massachusetts Insurance Commissioner (1975 to 1979), and then as chairman and commissioner of The U.S. Commodity Futures Trading Commission for four years. On his return from Washington, he founded The Plymouth Rock Group, which now has annual revenues in excess of a billion dollars.   His latest book is “5 Easy Theses: Commonsense Solutions To America’s Greatest Economic Challenges   

2016-05-29 Your Risk Capacity Show With Kayt Sukel & Ed Fulbright on Mastering Your Money Radio

Kayt Sukel

Are risk-takers born or made?  I want to know how successful risk-takers are doing it

·        What particular blend of biology and experience held within allows us to know what risks are worth taking

·        What risks should be left alone

What is risk?   Risk is often described in terms of either statistics or impending doom. But not even scientists fully agree on a working definition.   There are  fascinating neurological pathways that provide the “gas” and the “brakes” when we are faced with a risky decision.   Some of us have the kind of biology that makes us put on the brakes more often, while others have genes that actually contribute to making poor decisions.

Joining us for our discussion on Your Risk Capacity  is Kayt Sukel      who is calling in from her  office .  Kayt Sukel earned a B.S. in cognitive psychology from Carnegie Mellon University and an M.S. In Engineering Psychology from The Georgia Institute Of Technology. A passionate traveler and science writer, her work has appeared in Atlantic Monthly, New Scientist, USA Today, The Washington Post, Islands, Parenting, Bark, American Baby And AARP Bulletin. She is a partner at the award-winning family travel website Travel Savvy Mom (www.travelsavvymom.com), and is also a frequent contributor to the Dana Foundation’s many science publications (www.dana.org). Much of her work can be found on her website, www.kaytsukel.com, including stories about out-of-body experiences, computer models of schizophrenia and exotic travel with young children.   Her latest book is “The Art Of Risk: The New Science Of Courage, Caution, & Chance”      

2016-05-22 Having A Purposeful Life with Mark Aardsma on Mastering Your Money Radio Show

Mark Aardsma

I think everyone wants to have a purposeful life.    A family, job and life you love.   Many people are not living a life they love.  They hate their job, fustrated with their family and not living a life they love.  In the next 28 minutes we will show you how to have purposeful life.

Joining us for our discussion on Having A Purposeful Life is Mark Aardsma who is calling in from his _Campagin Ill Office .  Mark Aardsma is an entrepreneur, investor, and business coach. In the last ten years i’ve started three businesses. One that introduced me to the wonderful opportunity of entrepreneurship in america. And two that i am very grateful to have led from initial concepts to multi-million dollar businesses. His current companies specialize in acoustic panels and online projector, video camera, and lens rentals..   His latest book is “Investing With Purpose: Capitalize On The Time And Money You Have To Create The Tomorrow You Desire”      

2016-04-24 Business Resurrection with Richard Lindenmuth on Mastering Your Money Radio Show

Richard Lindenmuth

Businesses in trouble requires creativity and capital but more on creativity to stretch those capital dollars to bring the company back to life.

Joining us for our discussion on Business Resurrection is Richard Lindenmuth who is calling in from his California office .  Richard (Dick) Lindenmuth has been a corporate performance advisor and chief executive officer in a number of industries, with business models ranging from high-technology and services to heavy- and basic-industries. He has more than 30 years general management experience in domestic and international operations, and he is noted for his comprehensive execution skills in both high-growth and distressed environments. His latest book is “The Outside The Box Executive ”    

     

2016-04-17 Doing More With Less with Alex Verjovsky and Jeffrey Phillips on Mastering Your Money Radio

 Jeffrey Phillips

Look at any industry, in any market, and you’ll find the same strategy playing out everywhere. Companies compete with one another in a mindless race to the bottom, matching products and services feature for feature, competing primarily on price. This commoditizes markets and drives down prices and margins. But ultimately, no one wins—not even the consumer--as quality, service and differentiation suffer. We call this senseless strategy “attrition competition”, and it is derived from prevailing military strategy, which seeks to overwhelm competitors.  There must be a better way.

Joining us for our discussion on Doing More With Less are Jeffrey Phillips and Alex Verjovsky who are in studio.  Jeffrey Phillips leads Ovo Innovation, an innovation consulting company in Raleigh, North Carolina. Jeffrey has led strategy and innovation projects in a number of industries including pharmaceutical, high tech, financial services, insurance and medical products. He is the author of three books, including relentless innovation, and writes the popular innovate on purpose blog.

Alex Verjovsky brings over twenty years’ experience in the consulting and technology sectors as both a consultant and entrepreneur. His most recent company, Castor Fields Sapi, reached over twelve billion dollars in sales. Prior to Castor Fields, Alex founded biofuel alternatives, a pioneer in the biodiesel market. Alex is a graduate of Columbia business school. Their latest book is “Out Maneuver: Outthink, Don’t Outspend”         

2016-04-10 Money and Your Brain with Donna Skeels Cygan on Mastering Your Money Radio

Donna Skeels Cygan

Donna Skeels Cygan Interview - Money and Your Brain Show:  http://joyoffinancialsecurity.com/
Imagine being able to manage your money in a way that helps you achieve financial security,  but also increase your happiness.  You really can!! There are happiness and financial strategies
To align your values with your money.  Psychology research tells us we each control roughly 40% of our happiness.  The way we can become happier is through our choices, behavior, and attitude. Controlling your mind can help you make smarter money choices.

Smart Ways To Payoff Student Loans with Bruce Mesnekoff on Mastering Your Money Radio Program

Bruce Mesnekoff

Bruce Meskenoff Interview - Smart Ways To Payoff Student Loans Show: www.thestudentloanhelpcenter.com   Paying for your childs college  may be the 3rd biggest expense you face next to retirement and paying for your house.   Saving for college is great if you can start early and save often.  Paying for a child’s education over 20 years is better than paying for in 4 years or less.  Sometimes life does not go as plan and you don’t have enough money for their college.  So you have use student loans.  In 2012, the average student had $29400 in student loans.

2016-03-27 Online Branding With Melinda Emerson on Mastering Your Money Radio

Melinda Emerson  Small Biz Lady

Melinda Emerson Interview on Online Branding: http://succeedasyourownboss.com/  In a world of social media, it is easy to create an online brand for yourself but it is also easy to create a negative brand for yourself with realizing it.  I realized the power of social media when two people I recommended for a $200k position was eliminated from consideration because they had a underdeveloped linkedin site.  No resume opportunity eliminated by looking at your linkedin. Hmmm think you might want to sharpen your linkedin page???