Connor-Whitlock here. Boaz is working on the latest issue of Zero Hour Alert today, so he’s handed me the reins to Capital & Conflict.
Now, before we get started, full disclosure: I have given up with Brexit. I mean that in every context. I no longer try to follow what’s happening now, and I don’t try to analyse what’s going to happen in the future. Whenever friends or family of mine try to bring it up, my first reaction is to immediately change the subject.
Like many people, I’m sick of it.
At times, it can feel a bit pointless trying to understand it all or have an opinion. No matter which route you take, there will be someone telling you it’s wrong:
Leaving with no deal: terrible idea.
Leaving with a new deal: not worth the hassle.
Agreeing to the current deal: not really leaving.
Second referendum: spitting on democracy.
And on and on it goes.
Not engaging with the process may come across as lazy. But I’d argue it’s the only way to go. At least, it’s the only way you’ll keep your sanity.
I am no longer for or against Brexit. I’m indifferent to it.
Brexit will have ramifications that no one will predict anyway. Regardless of which side of the spectrum you’re on.
Take for example, Switzerland.
The Swiss model is touted as one of the more sensible options for a smooth Brexit. Switzerland’s economy is often admired for its independency and success.
It has also worked relatively well with the EU over the years. The country has a number of agreements with the EU which broadly give it access to Europe’s markets.
Switzerland’s detachment from the eurozone proved its effectiveness during the financial crisis. As its European neighbours suffered, the Swiss economy produced healthy employment levels, low debt and strong exports.
But then something happened which illustrates why I take such a laissez-faire approach.
Switzerland had shown itself to be one of the most resilient economies out there. The only problem was that people saw this.
Currency traders, desperate for a safe investment, moved into Swiss francs. This pushed the value of the Swiss franc up around 30% compared to the euro.
The overvalued currency made Swiss exports expensive and Swiss companies began to suffer.
Fearing the worst for its economy, the Swiss government felt compelled to intervene. The Swiss National Bank stepped in to artificially weaken its own currency.
Switzerland weathered the credit crunch well. But due to unforeseen movements by its neighbours, its economy was deemed “too good” and had to be dragged down.
Switzerland did everything right, but still suffered. Its stories like this that make me shrug my shoulders.
And good luck to those who attempt to wrap their heads around every facet of Brexit by digesting every inch of uber-visceral media coverage. I’ve just googled the word Brexit and it found 202 million news results. Honestly, why would you even want to try and sensibly approach headlines like these:
- British influence in Washington has ‘vanished’ due to Brexit, French ambassador to US says
- ’Europe is CRUMBLING!’ Historian issues post-Brexit warning of ‘CRITICAL’ phase for EU
- Change UK candidate said he wants Brexit if it stops Romanian pickpockets
- Manchester City fans could teach Brexit Britain how to put the fun in failure
- ‘CLUSTER F***!’ Wolf of Wall Street Jordan Belfort gives May FRANK Brexit advice
With headlines like these, it’s no wonder that everyone’s so stressed by it all.
As I alluded to previously, I’ve often felt conflicted about my take on Brexit. Sure, I’m less stressed as a result of giving up on following it. But aren’t I ignoring some sort of intellectual obligation to analyse what’s going on?
Turns out, not really.
Tim Price, one of our financial experts, often writes about how taking a news detox could be the best thing for us.
Tim often highlights the work of the Swiss author and businessman Rolf Dobelli. In one of his reports Dobelli highlights 15 dangers of news consumption. As it turns out though, I only needed five to prove my point. I’m sure you’ll be able to relate to the issues below:
- News misleads us systematically – simply put, we are prone to pay attention to the most visible and sensational pieces of information. This is the case even if that information is misleading or incorrect. The news industry knows this and exploits it.
- News is irrelevant – of all the news you’ve read in your life, how much of it can you recall? The news you receive is often touted as essential. But more often than not it will bear no consequence on your life.
- News limits understanding – the news may present “facts” and they insist these facts are crucial. But knowing the facts is not the important part. Understanding the threads that connect these facts is the crucial part. The news glosses over deeper connections that bind the world together.
- News is toxic to your body – the negative news we’re bombarded with triggers our limbic system. The stress hormone cortisol is released which leaves us constantly stressed and impairs our immune system. News literally makes us sick.
- News makes us passive – what is a common thing most news stories share? They are mostly about things you cannot influence. This makes us become passive; sapping our energy and leads us on a path to pessimism.
You can see evidence for all of this in Brexit coverage right?
There is a solution to all of this misery though. You as an investor can join us in ignoring the inconsequential. We pride ourselves on not holding a house view. We’re adept at cutting through all the noise to discover the real nuggets of information. No hostile, misleading or bias news story can sway our proven investment principles.
And that includes the ridiculousness of Brexit coverage.
I hope you join me in avoiding any sensational Brexit nonsense. They say ignorance is bliss; well, we say ignorance is essential.
You still may not be sure about what makes us so unique or worthwhile. Well, there’s an old joke I think illustrates our purpose, and our aim as an organisation to empower our readers:
“Dear Optimist and Pessimist, while you were busy debating over whether the glass was half-full or half-empty, I drank it. Signed, the Opportunist.”
Until next time,
Connor Coombe-Whitlock
Analyst, Southbank Investment Research
Category: Market updates