Could the next recession begin with the Brexit situation ?

[Stockolio]

I have been doing some reading and wondering what the actual situation would be like if a no deal Brexit actually happens ? UK is knee deep in ARMs, and along with Australia do not have confident looking RMBS delinquency results. When there economy starts to slip just a bit, they have a lehman collapse at the door

For the traders who live in the UK, what is the situation like with housing and the situation with no deal Brexit being a possibility, the real consequences of a no Brexit deal?

 

[southall]

Due to timing of the 2016 vote+ 3 years. A slowdown or recession was always going to coincide with the exit due to the end of the economic cycle.
It is hard to predict how much interest rates and unemployment will rise and at what point things would start to get really nasty.
But when you see all these overpriced apartment blocks going up everywhere around you, then you cant help but get the feeling that it is not going to end well.

 

[Stockolio]

From my understanding, a hard or no deal brexit is a possibility at this point, one third of her own party oppose it, along with the opposition and rest of EU leaders. It seems the power to be want to punish UK or start the recession through this, and have a 2nd referendum and force no exit vote into submission through economic downfall. I had my plan to go 100 % puts by July, but UK recession might be months away, and with yesterday's sell-off, it is quite obvious things are brewing there and it will have a domino affect on the world. The January 21 deadline, things could be deteriorating after that... If anyone understands the Brexit Details really well, please add input, would be greatly appreciated

 

[JSOP]

I have been doing some reading and wondering what the actual situation would be like if a no deal Brexit actually happens ? UK is knee deep in ARMs, and along with Australia do not have confident looking RMBS delinquency results. When there economy starts to slip just a bit, they have a lehman collapse at the door

For the traders who live in the UK, what is the situation like with housing and the situation with no deal Brexit being a possibility, the real consequences of a no Brexit deal?

Don't think so. Europe is not big enough of an economy to trigger anything. UK will adjust through a "no deal" Brexit if it really comes to that and that's it. There is nothing fundamentally wrong with UK's Brexit so it shouldn't impact its economy or global economy that much. The last time when we had the financial crisis in 2008, 1) USA was the largest economy that collapsed and its effect rippled through the entire global economy except China because everybody had tremendous amount of business with USA and 2) there was something fundamentally wrong with the economy brought upon by the bursting of the housing market and the MBS market built upon the fraudulent lending practices and deceitful rating agencies. Neither of these exist this time with UK's Brexit so it should not bring upon any financial crisis like last time.

If there is going to be a financial crisis, it would be brought upon by something else.

 

[Stockolio]

Don't think so. Europe is not big enough of an economy to trigger anything. UK will adjust through a "no deal" Brexit if it really comes to that and that's it. There is nothing fundamentally wrong with UK's Brexit so it shouldn't impact its economy or global economy that much. The last time when we had the financial crisis in 2008, 1) USA was the largest economy that collapsed and its effect rippled through the entire global economy except China because everybody had tremendous amount of business with USA and 2) there was something fundamentally wrong with the economy brought upon by the bursting of the housing market and the MBS market built upon the fraudulent lending practices and deceitful rating agencies. Neither of these exist this time with UK's Brexit so it should not bring upon any financial crisis like last time.

If there is going to be a financial crisis, it would be brought upon by something else.

UK is as deep in the subprime MBS as the states was in 06-07, I am a freak when it comes to RMBS data, I even read the details and fine-prints of RMBS/CMBS sometimes, trust me on this... UK is in some serious trouble, there 90 + days delinquency are not even close to healthy levels... Scotland will do another referendum after the Brexit to add headaches, it is gonna be a serious mess and given the fragile sentiment around the world and end of business cycle approaching, all it needs is a catalyst. I seen Costco yesterday share lose 8.63 % of its value after there latest financial, they reported a net income of 767 million, no issuance of debt or stock in the quarter, it was a tremendous quarter. It's clear at this point there is panic within the big firms... Please tell me, why do you think the British Pound getting annihilated after Brexit and a serious collapse in UK wont domino affect the rest of a crippled Europe which would then hit Asia then North America ?

 

[JSOP]

UK is as deep in the subprime MBS as the states was in 06-07, I am a freak when it comes to RMBS data, I even read the details and fine-prints of RMBS/CMBS

I know that's why UK was f***ed in the financial crisis of 08 as well.

sometimes, trust me on this... UK is in some serious trouble, there 90 + days delinquency are not even close to healthy levels... Scotland will do another referendum after the Brexit to add headaches, it is gonna be a serious mess and given the fragile sentiment around the world and end of business cycle approaching, all it needs is a catalyst.

Let Scotland join EU for all Britain cares. With the oil price so low and China's economic growth slowing down nowadays Scotland is not that rich like before anyway. Instead of having Scotland to be a net receiver within Britain, it would be great it would become a net receiver in the EU and let all those EU contributing nations to have one more member on their payroll, yeah joy! Good riddance, if only EU would want Scotland!!

Please tell me, why do you think the British Pound getting annihilated after Brexit and a serious collapse in UK wont domino affect the rest of a crippled Europe which would then hit Asia then North America ?

Why? Because people always knee-jerk overreact to something new. In the beginning there would be some adjustment, actually not that much really but eventually everything would be just what and how they are but people panic nevertheless and think the world is going to end. The world is not going to end. Britain is not going to end. Britain is going to be just fine!!! Britain has weathered far worse than Brexit before (just ask the Queen, she's been through almost a century now) and has come on on top, this Brexit is nothing. People just need to get focused and realize that it's better for the future even though you might not be able to see it now. If Asia and North America doesn't want to feel the potential "domino effect" then it better start trading with UK, more and fast!

 

[Stockolio]

I know Britain will be fine, in the end just print more money right, couple of keyboard strokes and voila, billions in QE! I mean as a Trader, I am looking to stretch it out before I blast PUTs. Logically once the liquidity providers smell something too strong, the premiums on buying puts will be very high or non existent. I do not care about if UK will be good in 10 years or not, I just need my decision based on the next few months ? And it seems only negative can come out of that whole ordeal, a Brexit will be the start of a worldwide recession, no way around it. The only other possibility would be delaying the inevitable through a 2nd referendum and maybe another catalyst will come along in mid or end 2019 to start it. It is your strategy and your trades, but I strongly suggest not waiting until mid or end 2019 to place your PUTs, premiums will be very high by then on almost anything

 

[d08]

Don't think so. Europe is not big enough of an economy to trigger anything.

The EU is 22% of the world economy. That's not big enough?

There is nothing fundamentally wrong with UK's Brexit so it shouldn't impact its economy or global economy that much.

Not sure you quite understand what Brexit means. By law all the EU clients serviced in UK will have to be moved to an EU country. That's just one thing that will happen. Then there's the fact the UK economy is intertwined with the EU deeply, all that will dramatically change.
On top of that there are so many agreements missing or incomplete, when it goes into effect there will be some proper chaos.

 

[schweiz]

The EU is 22% of the world economy. That's not big enough?
Not sure you quite understand what Brexit means. By law all the EU clients serviced in UK will have to be moved to an EU country. That's just one thing that will happen. Then there's the fact the UK economy is intertwined with the EU deeply, all that will dramatically change.
On top of that there are so many agreements missing or incomplete, when it goes into effect there will be some proper chaos.

Better stop the discussion with him. He is so full of being British that he lost all contact with reality.

 

[Visaria]

And it seems only negative can come out of that whole ordeal, a Brexit will be the start of a worldwide recession, no way around it.

I'm not saying there will not be a recession in the world or a bear market or whatever...i don't think Brexit itself will be a trigger simply because everyone knows we are leaving at the end of March. It's a known known. Something else may be a trigger or perhaps there is no trigger, bear market/recession whatever just happens.