Lessons from the last Brexit: behind the tears of Black Wednesday and the rise of George Soros by Xie Qian

Author:Xie, Qian [Xie, Qian]
Language: eng
Format: epub
Published: 2019-10-26T16:00:00+00:00

Figure 20 - analysis E->F, the endgame after Black Wednesday

Summary

Tom Geoghegan (2008), a writer of BBC News Magazine has commented that “the UK was technically out of recession by the time it left ERM”. It might be hard to imagine that Black Wednesday was the endgame of the inflation war , but the lessons were learnt.

Since 1997, the Bank of England’s Monetary Policy Committee was in charge of achieving targeted inflation, now at setting 2%. Instead of targeting exchange rate like ERM, the committee was responsible to target inflation, keeping it between 1% and 3% (Inflation and the 2% target, n.d.).

Let me summarise the journey so far: unstainable boom led to rising inflation, which became out of control as bubbles burst and war broke out; as the recession took place, ERM made UK inefficient to take actions; luckily the re-election and Soros took place in 1992, saved UK from inflation and contributed to the last “Brexit”.

Part 2 Brexit - the elephant in the room

What about the future? Can we see the same patterns? And will this Brexit leave UK another “unparalleled opportunities” as John Major claimed in 1993 (reported in BBC, 1993).

We cannot look at the future of UK and the world, without considering the elephant in the room – Brexit. Ever since the referendum in 2016, the Pandora’s Box has been opened.

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