(This was written before I knew that Queen Elizabeth had died. May her soul rest in peace.)
Last year I wrote when the United Kingdom could not find truck drivers: “Feel free to throw the verbal flames. Yes, why should this village boy from Nigeria be discussing what is happening in the UK. I have to because it is a free world. When the UK voted for BREXIT, they voted for “freedom”. Yes, that guy is coming for my lunch. But interestingly, that guy coming for your lunch may be the one making sure you have breakfast and dinner.”
I made the point that the UK scored an own-goal by executing BREXIT. In our modern world, coming together deepens competitive and comparative advantages since we’re all living in gloCal (global + local) world. But when you disconnect, you pay a penalty. Yes, igwebuike – “strength in unity”
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As Liz Truss takes over as the UK Prime Minister, starting with tax cuts and the typical conservative playbooks, there are many shifts she has to manage. And those shifts are invisible like the “invisible hand” of Adam Smith’s thesis many centuries ago. For those British doctors to thrive, they may need a garbage cleaner in that community. If you disconnect those cleaners, you introduce fudge factors that can be devastating to the economy.
People, the British Pound Sterling “dropped as much as 1% to $1.141, a low last reached by Margaret Thatcher’s government in 1985.” Within the next 4 years, I predict that the US dollars will be stronger than the Sterling. The primary reason is that the BREXIT is rebalancing the British currency, weakening it in the process.
A bleak economic outlook and the most recent surge in the value of the US dollar has caused the pound to decline to its lowest point in over four decades.
Sterling dropped as much as 1% to $1.141, a low last reached by Margaret Thatcher’s government in 1985.
The economic picture is difficult, just like then. Double-digit inflation and the potential for a protracted economic downturn are two concerns that Britain is currently battling. The Bank of England has issued a more than one-year recession warning.
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