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Why investors shouldn’t ignore Brexit – one simple reason

brexit consequences

  1. It’s not going to happen, but the markets are still fannying around with it.

Do you want to be thousands of pounds poorer? Of course not – even if you’ve been a good saver since your early teens and actually have a thousand pounds to rub together, you don’t want it to evaporate on 23 June, do you? You don’t – no matter how rich, old or Tory you are.

And what’s more the old, rich, male Tories (the ones who read the Telegraph at any rate) are abandoning the ‘leave’ camp in Goves… I mean droves. Seriously, who’s left to vote ‘leave’, apart from my mother? A few maybe, but never enough.

I mean there are two I can think of. The Taunton-Smart-Arses (name changed to protect their EU-derived human rights) – two perfect parents, three perfect daughters and a perfect dog – are split down the middle, even though the family ice cream business succumbed ‘to EU red tape.’ Little Glorietta says the EU ruined mummy’s ice cream business – she’s voting ‘leave.’

Mummy is indifferent, while man of the house Giles doesn’t only hold that it ‘served the bitch right’ for not concentrating her efforts, like he did, on the family smallholding (producing very little except a nice EU subsidy) that supplies one of Jamie Oliver’s numerous Italian restaurants staffed entirely by Hungarian ex-convicts with spinach. No, he’s not at all keen on being poor either. It’s a ‘stay’ from Giles. The dog is worried about the price of dog food rising  – he’s an outer.

Now, let’s be clear that all our cash isn’t going to evaporate on 23 June, Brexit or no Brexit. However, it’s surprising what you can achieve by a good old fashioned bit of financial hooliganism. For some reason, when intelligent people are in crowds, their collective intelligence implodes. That’s why we all know within ourselves that the arguments both for and against Brexit are untestable rubbish, while the financial markets believe every single word.

This brings us to the reason why investors shouldn’t ignore Brexit. You as an individual can capitalise on this. There’s never been a better time to separate yourself from the crowd and trade this madness. They said the pound will get weaker: Buy the pound. They said house prices will go down by 20%: Buy the house builders (if we get a Brexit and house prices really do go down by 20%, then buy a house!). They said there’ll be a run of panic buying of fuel and food before the UK is permanently scrubbed from the known world’s Christmas card lists: You got it – buy the supermarkets!

If you still think a Brexit might happen, then recall the US and Brussels buddying up to declare nuclear war on the UK’s children should we vote to leave. Even the prospect of some old Tories saving a few bob on inheritance tax isn’t enough to keep them pegged down in the ‘leave’ camp.

Nonetheless, amid all this we’ve got markets going all over the place. That’s why investors shouldn’t ignore Brexit. It’s a technical trader’s paradise. Until we’re through June you can all but ignore corporate fundamentals. If you want to capitalise on the mass stupidity that’s currently driving the markets, then check out our educational bits and bobs on technical analysis.

In the meantime I hope you enjoy, as I have, the first class entertainment that Brexit has put on for us all because once it’s all over it’ll be back to Bitcoin, Greece and the Fed.

Augustin Eden (25 May)

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