It is already possible to assess the major predictions of the Remain Economists about the economic effects of leaving the EU. This is because these economists predicted that a Leave vote in the referendum would produce an immediate meltdown of the UK economy. The meltdown was the expected result of voting Leave and the "uncertainty" this might cause. Consider the much publicised IMF predictions:
There was wide agreement amongst Remain Economists that a Leave vote would cause such uncertainty in the year after the referendum that the fall in economic output would scar UK prosperity for decades to come. The key to the arguments of the Remain Economists was that "uncertainty" would damage the UK irreparably, the recession in 2016/2017 being so great that we never recover:
The red line in the graph above shows the IMF's predicted collapse of
the UK economy in 2016-17.
In the first month or two after the referendum all the broadcast News Media fully believed this story of collapse and told the population to await immediate economic doom. Doom certainly has not happened.
The Remain campaign and the broadcast News Media are now saying that the "experts" predictions of disaster were actually about what would happen to the UK economy after the UK tells the EU it is leaving, a process called "Invoking Article 50" which is truly no more than telling the EU that the UK is leaving (The full text of Article 50 is given in Note 3 below). However, this was not the intention of the IMF and other forecasters. The IMF clearly explain at the end of their paper, in the section headed "Estimating the Effects of Uncertainty" that their analysis is about "uncertainty". This section does not mention Article 50 and talks entirely about perceptions and confidence. There can be no doubt at all that the IMF predictions start with a Leave vote on June 23rd 2016.
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Breaking News January 2017: IMF revises its predictions! Brexit will now be fine:
Bank of England has also predicted good growth. So, its official, all the Brexit gloom was indeed just scaremongering. But follow the rest of the article for the sheer extent of the lie by Remain economists.
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The Bank of England and the UK Treasury employ an army of economists, many of whom had communicated with the IMF about its predictions. Soon after the referendum the Bank of England forecast near recession growth of 0.1% for the UK economy for June to September 2016 (Q3) even though it knew that Article 50 had not been invoked, proving that the forecasts were unrelated to Article 50. By September it was clear that this forecast was hopelessly wrong
and growth was in reality strong at 0.5% for Q3. Remain activists
attempt to argue that the predicted recession was avoided because Art 50
had not been invoked but as can be seen from the Bank of England
position, the predictions were not based on invoking Article 50, they
were based on "uncertainty" and were wrong, as the Bank has now freely admitted (see Times article on right).
Obviously invoking Article 50 and actual Brexit would reduce uncertainty so, according to the "uncertainty" thesis, waiting for a few months before invoking Article 50 should be the very worst option. Which, of course, is why the government has waited before finally declaring Article 50: Cameron initially hoped that the People would be scared back into the EU by an economic collapse.
The key to the failure of the Remain economist's forecasts is that they assumed that investment would fall drastically after the Referendum. This has not happened:
Investment in the UK has remained at near record highs since 2015. Obviously if you were uncertain about whether to invest you would have begun that uncertainty on June 24th 2016 (Article 50 will reduce any uncertainty).
Many other Remain pundits repeated the IMF mistake. Price Waterhouse Coopers predicted a massive meltdown after the Referendum, due to "uncertainty", that has not happened:
The PwC graph above is extremely sneaky. The data points are predicted cumulative effects so the recovery from 2019 to 2022 is actually due to strong growth happening after Brexit occurs (IMF had same prediction - see above)!
The worst "Experts" of all were the HM Treasury whose "dodgy dossier", HM Treasury Analysis: The immediate impact of leaving the EU, should go down in history along with the Government's Iraq War dossiers:
The reason that the IMF, PwC, Treasury etc. used "uncertainty" immediately after the referendum as their main argument against Brexit was that all of the experts, Remain or Leave, predicted good growth after Brexit actually happens. Here are quotes from their analyses:
"The UK economy then experiences faster growth in the medium term at 2.6% on average in 2021-25, before settling at around 2.4% per annum in 2026-2030." PWC: Implications of an EU Exit
"Growth rates in later years are higher than the baseline.." IMF Country Report for UK
All of the economic data since the EU Referendum has been good. Retail sales are up, confidence has rapidly recovered after a brief fall, exports are up and imports are down. The fall in the pound has been excellent news, it was overvalued due to the flight of Euros from the unstable Eurozone and this has been corrected so that the pound is back to its real value:
The latest adjustment in the value of the pound after the referendum completes the move back to a realistic exchange rate that began in 2014. The Eurozone has become less unstable since 2014 and this has reduced the flight of Euros into Sterling. Had there not been a speculative blip upwards in the value of sterling before the referendum the current fall back to the PPP (Purchase Power Parity) value of the pound would have been unexceptional.
The fall in the pound has been independent of any poor economic data except the Balance of Payments Current Account deficit and a flurry of speculation around the date of the Referendum.
The Bank of England confirmed that the Balance of Payments would cause the pound to fall: "A persistent current account deficit could lead to a sudden adjustment in capital flows or depreciation of the exchange rate, with adverse consequences for UK financial stability." Bank of England
The fall in the pound is not due to any poor economic performance after the Referendum - as will be seen below, the UK economy has been performing very well since the Referendum. Certainly the fall since the Referendum has been excessive - if I were a currency trader I would be betting on a rise in the pound a few months after Article 50 is invoked because, in the long run the pound will return to near PPP value.
So, there has been no recession and the pound is falling for reasons other than poor performance of the economy after the Referendum. It looks like Remain economists may have been paid to lie. Remain economists (cf: Vycky Pryce on BBC Today 6/1/17) have attempted to cover up these failed predictions by saying that the £70 billion of Quantitative Easing and a 0.25% cut in interest rates "saved" the UK economy from recession. These amounts are tiny and would scarcely affect the economy. At least the Bank of England had the decency to simply admit it was wrong.
Admitting being wrong is one thing, but being so crazily, massively wrong is another thing entirely. It is now absolutely clear that the Remain campaign was scaremongering. Remain have only escaped censure because most UK Political Parties supported Remain and the broadcast media have suppressed coverage of what happened.
The UK Economic News has been good since the Referendum
The Bank of England had raised its forecast of economic growth for the third quarter of 2016 from a Remain Economist, pessimistic 0.1% to a buoyant figure of 0.3% by 15th September 2016. In fact the real growth figure was 0.5%. Notice that they were pessimistic, with a 0.1% estimate, even though they knew that Article 50 had not been issued. Fortunately there will be no recession, the Treasury, Bank of England, IMF and PwC were wrong, even by Q3 the UK GDP is 0.2% higher than the IMF forecast for the year.
The trade deficit decreased in July: "The UK’s deficit on trade in goods and services was estimated to have been £4.5 billion in July 2016, a narrowing of £1.1 billion from June 2016. Exports increased by £0.8 billion and imports decreased by £0.3 billion." ONS Data
UK Employment rate is still high and has stabilised at record levels:
The IMF and HM Treasury forecast falling employment.
Earnings have continued to grow:
The FTSE 250 - the share index that reflects domestic share values - has remained at record highs since the end of August:
Manufacturing confidence has increased since the EU Referendum (despite a blip in July).
Services PMI is also up:
Retail sales are growing strongly:
So, Remain economists got the economics of Brexit totally wrong, or they were trying to scare the People into being obedient.
There is much talk of "Brexit Lies" but the Remain campaign said that the Referendum would create a fall of about 3-5% in GDP and so cost an annual £75 bn to £125 billion a year (total GDP = £2.5 trillion).
Not only have the Remain Broadcast Media failed to cover the shocking lies told by Remain economists, they are actively suppressing all data on the terrible trade and balance of payments deficits with the EU.
See EU Single Market - good or bad for UK for more information. The Broadcast Media are obfuscating their failure to act honestly with absurd propaganda about "post truth".
Note 1: The PwC graph confuses many people because it is a graph of the cumulative predicted effect (ie: exaggerates the effect). In particular, the first data point is for 2017 but consists of the predicted effects of what is supposed to happen in 2016. The graph below uses the IMF data to show how the PwC graph was constructed:
Which, using the PwC data gives rise to:
Note 2: The IMF Data. Notice GDP already exceeds the IMF figure for the whole year by Q3 - the IMF predicted a collapse post-referendum.
Note 3: The full text of Article 50:
Article 50 was used as shorthand for "Leave wins the referendum" because Cameron said he would immediately invoke Article 50 if Leave won - presumably to reduce uncertainty. He did not do so and this deliberately increased uncertainty.
1. Any Member State may decide to withdraw from the Union in accordance with its own constitutional requirements.
2. A Member State which decides to withdraw shall notify the European Council of its intention. In the light of the guidelines provided by the European Council, the Union shall negotiate and conclude an agreement with that State, setting out the arrangements for its withdrawal, taking account of the framework for its future relationship with the Union. That agreement shall be negotiated in accordance with Article 218(3) of the Treaty on the Functioning of the European Union. It shall be concluded by the Council, acting by a qualified majority, after obtaining the consent of the European Parliament.
3. The Treaties shall cease to apply to the State in question from the date of entry into force of the withdrawal agreement or, failing that, two years after the notification referred to in paragraph 2, unless the European Council, in agreement with the Member State concerned, unanimously decides to extend this period.
4. For the purposes of paragraphs 2 and 3, the member of the European Council or of the Council representing the withdrawing Member State shall not participate in the discussions of the European Council or Council or in decisions concerning it. A qualified majority shall be defined in accordance with Article 238(3)(b) of the Treaty on the Functioning of the European Union.
5. If a State which has withdrawn from the Union asks to rejoin, its request shall be subject to the procedure referred to in Article 49.
Originally published 13/9/16 Updated 2/1/17
 |
| IMF |
In the first month or two after the referendum all the broadcast News Media fully believed this story of collapse and told the population to await immediate economic doom. Doom certainly has not happened.
The Remain campaign and the broadcast News Media are now saying that the "experts" predictions of disaster were actually about what would happen to the UK economy after the UK tells the EU it is leaving, a process called "Invoking Article 50" which is truly no more than telling the EU that the UK is leaving (The full text of Article 50 is given in Note 3 below). However, this was not the intention of the IMF and other forecasters. The IMF clearly explain at the end of their paper, in the section headed "Estimating the Effects of Uncertainty" that their analysis is about "uncertainty". This section does not mention Article 50 and talks entirely about perceptions and confidence. There can be no doubt at all that the IMF predictions start with a Leave vote on June 23rd 2016.
-----------------------------------------------------------------------------------------------------------------------
Breaking News January 2017: IMF revises its predictions! Brexit will now be fine:
Bank of England has also predicted good growth. So, its official, all the Brexit gloom was indeed just scaremongering. But follow the rest of the article for the sheer extent of the lie by Remain economists.
-----------------------------------------------------------------------------------------------------------------------
 |
| Times: Britain has world's top economy |
Obviously invoking Article 50 and actual Brexit would reduce uncertainty so, according to the "uncertainty" thesis, waiting for a few months before invoking Article 50 should be the very worst option. Which, of course, is why the government has waited before finally declaring Article 50: Cameron initially hoped that the People would be scared back into the EU by an economic collapse.
The key to the failure of the Remain economist's forecasts is that they assumed that investment would fall drastically after the Referendum. This has not happened:
Many other Remain pundits repeated the IMF mistake. Price Waterhouse Coopers predicted a massive meltdown after the Referendum, due to "uncertainty", that has not happened:
 |
| PWC: Implications of an EU Exit |
The worst "Experts" of all were the HM Treasury whose "dodgy dossier", HM Treasury Analysis: The immediate impact of leaving the EU, should go down in history along with the Government's Iraq War dossiers:
 |
| HM Treasury Model predictions vs ONS Data for Unemployment |
 |
| ONS CPI Data |
The reason that the IMF, PwC, Treasury etc. used "uncertainty" immediately after the referendum as their main argument against Brexit was that all of the experts, Remain or Leave, predicted good growth after Brexit actually happens. Here are quotes from their analyses:
"The UK economy then experiences faster growth in the medium term at 2.6% on average in 2021-25, before settling at around 2.4% per annum in 2026-2030." PWC: Implications of an EU Exit
"Growth rates in later years are higher than the baseline.." IMF Country Report for UK
All of the economic data since the EU Referendum has been good. Retail sales are up, confidence has rapidly recovered after a brief fall, exports are up and imports are down. The fall in the pound has been excellent news, it was overvalued due to the flight of Euros from the unstable Eurozone and this has been corrected so that the pound is back to its real value:
 |
| (Notice pound has been falling since 2014) |
The Bank of England confirmed that the Balance of Payments would cause the pound to fall: "A persistent current account deficit could lead to a sudden adjustment in capital flows or depreciation of the exchange rate, with adverse consequences for UK financial stability." Bank of England
The fall in the pound is not due to any poor economic performance after the Referendum - as will be seen below, the UK economy has been performing very well since the Referendum. Certainly the fall since the Referendum has been excessive - if I were a currency trader I would be betting on a rise in the pound a few months after Article 50 is invoked because, in the long run the pound will return to near PPP value.
So, there has been no recession and the pound is falling for reasons other than poor performance of the economy after the Referendum. It looks like Remain economists may have been paid to lie. Remain economists (cf: Vycky Pryce on BBC Today 6/1/17) have attempted to cover up these failed predictions by saying that the £70 billion of Quantitative Easing and a 0.25% cut in interest rates "saved" the UK economy from recession. These amounts are tiny and would scarcely affect the economy. At least the Bank of England had the decency to simply admit it was wrong.
Admitting being wrong is one thing, but being so crazily, massively wrong is another thing entirely. It is now absolutely clear that the Remain campaign was scaremongering. Remain have only escaped censure because most UK Political Parties supported Remain and the broadcast media have suppressed coverage of what happened.
The UK Economic News has been good since the Referendum
The Bank of England had raised its forecast of economic growth for the third quarter of 2016 from a Remain Economist, pessimistic 0.1% to a buoyant figure of 0.3% by 15th September 2016. In fact the real growth figure was 0.5%. Notice that they were pessimistic, with a 0.1% estimate, even though they knew that Article 50 had not been issued. Fortunately there will be no recession, the Treasury, Bank of England, IMF and PwC were wrong, even by Q3 the UK GDP is 0.2% higher than the IMF forecast for the year.
The trade deficit decreased in July: "The UK’s deficit on trade in goods and services was estimated to have been £4.5 billion in July 2016, a narrowing of £1.1 billion from June 2016. Exports increased by £0.8 billion and imports decreased by £0.3 billion." ONS Data
UK Employment rate is still high and has stabilised at record levels:
 |
| ONS Data |
Earnings have continued to grow:
The FTSE 250 - the share index that reflects domestic share values - has remained at record highs since the end of August:
Manufacturing confidence has increased since the EU Referendum (despite a blip in July).
Retail sales are growing strongly:
 |
| ONS Retail Sales |
So, Remain economists got the economics of Brexit totally wrong, or they were trying to scare the People into being obedient.
There is much talk of "Brexit Lies" but the Remain campaign said that the Referendum would create a fall of about 3-5% in GDP and so cost an annual £75 bn to £125 billion a year (total GDP = £2.5 trillion).
Not only have the Remain Broadcast Media failed to cover the shocking lies told by Remain economists, they are actively suppressing all data on the terrible trade and balance of payments deficits with the EU.
See EU Single Market - good or bad for UK for more information. The Broadcast Media are obfuscating their failure to act honestly with absurd propaganda about "post truth".
Note 1: The PwC graph confuses many people because it is a graph of the cumulative predicted effect (ie: exaggerates the effect). In particular, the first data point is for 2017 but consists of the predicted effects of what is supposed to happen in 2016. The graph below uses the IMF data to show how the PwC graph was constructed:
 |
Note 2: The IMF Data. Notice GDP already exceeds the IMF figure for the whole year by Q3 - the IMF predicted a collapse post-referendum.
Note 3: The full text of Article 50:
Article 50 was used as shorthand for "Leave wins the referendum" because Cameron said he would immediately invoke Article 50 if Leave won - presumably to reduce uncertainty. He did not do so and this deliberately increased uncertainty.
1. Any Member State may decide to withdraw from the Union in accordance with its own constitutional requirements.
2. A Member State which decides to withdraw shall notify the European Council of its intention. In the light of the guidelines provided by the European Council, the Union shall negotiate and conclude an agreement with that State, setting out the arrangements for its withdrawal, taking account of the framework for its future relationship with the Union. That agreement shall be negotiated in accordance with Article 218(3) of the Treaty on the Functioning of the European Union. It shall be concluded by the Council, acting by a qualified majority, after obtaining the consent of the European Parliament.
3. The Treaties shall cease to apply to the State in question from the date of entry into force of the withdrawal agreement or, failing that, two years after the notification referred to in paragraph 2, unless the European Council, in agreement with the Member State concerned, unanimously decides to extend this period.
4. For the purposes of paragraphs 2 and 3, the member of the European Council or of the Council representing the withdrawing Member State shall not participate in the discussions of the European Council or Council or in decisions concerning it. A qualified majority shall be defined in accordance with Article 238(3)(b) of the Treaty on the Functioning of the European Union.
5. If a State which has withdrawn from the Union asks to rejoin, its request shall be subject to the procedure referred to in Article 49.
Originally published 13/9/16 Updated 2/1/17
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