Brexit A Play in Two Parts Blu Putnam
Brexit: A Play in Two Parts Blu Putnam Chief Economist CME Group © 2019 CME Group. All rights reserved.
Investment advice is neither given nor intended The research views expressed herein are those of the author and do not necessarily represent the views of CME Group or its affiliates. All examples in this presentation are hypothetical interpretations of situations and are used for explanation purposes only. This report and the information herein should not be considered investment advice or the results of actual market experience. © 20192 CME Group. All rights reserved.
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Part I: Brexit the Play – Cast of Characters © 2018 CME Group. All rights reserved. 4
William Shakespeare https: //www. goodreads. com/photo/author/947. William_Shakespeare © 2018 CME Group. All rights reserved. 5
John Maynard Keynes https: //www. goodreads. com/photo/author/ 947. William_Shakespeare © 2018 CME Group. All rights reserved. 6
Charles De Gaulle Stock photo of General De Gaulle. © 2018 CME Group. All rights reserved. 7
Sir Edward (Ted) Richard George Heath https: //en. wikipedia. org/wiki/Edward_Heath#/m edia/File: Edward_Heath_4_Allan_Warren. jpg © 2018 CME Group. All rights reserved. 8
The Maastricht Treaty (1992 -93) created the European Union and ushered in the Euro (1999). https: //www. reddit. com/r/europe/comments/ao 1 w 5 v/on_this_day_in_ 1992_the_maastricht_treaty_was/ © 2018 CME Group. All rights reserved. 9
David Cameron https: //www. theguardian. com/politics/2 016/jun/24/david-cameron-resigns-afteruk-votes-to-leave-european-union © 2018 CME Group. All rights reserved. 10
Arlene Foster https: //www. google. com/search? safe=active&biw=1625&bih=847&tbm=is ch&sa=1&ei=0 qyw. XIOJHqa. Rggf. Dmoz. YCA&q=democratic+unionist+part y&oq=democratic+un&gs_l=img. 1. 0. 0 l 7 j 0 i 5 i 30 l 3. 81254. 85845. . 88543. . . 0. 0. 278. 1751. 1 j 1. . . 0. . 1. . gws-wizimg. Zjpw. KOKov. Ew#imgrc=1 c. Lww. EQtqb. HJn. M: &spf=1555082540501 © 2018 CME Group. All rights reserved. 11
Mary Lou Mc. Donald https: //www. google. com/search? safe=active&biw=1625&bih=84 7&tbm=isch&sa=1&ei=xauw. XMya. KISp_Qapm. Znw. Cw&q=sein+fi en&oq=sein+fien&gs_l=img. 3. . 0 i 10 i 24. 264275. 266831. . 267622. . . 0. 0. 185. 1084. 3 j 6. . . 0. . 1. . gws-wizimg. . . . 0 j 0 i 67 j 0 i 30 j 0 i 5 i 30 j 0 i 8 i 30. hf. SJZ 9 zgc 2 Q#imgrc=kfiv. LAo. Pk Y-k. VM: &spf=1555082450449 © 2018 CME Group. All rights reserved. 12
Theresa May https: //www. google. com/search? q=theresa+may&safe=active&source=ln ms&tbm=isch&sa=X&ved=0 ah. UKEwj 43_6 x 7 Mrh. Ah. UBhu. AKHW 3 HDgo. Q_A UIDyg. C&biw=1625&bih=847#imgrc=1 IBAb 3 Z 3 d_e. Ub. M: &spf=155508218161 7 © 2018 CME Group. All rights reserved. 13
Jeremy Corbyn https: //www. cnn. com/2019/02/05/opinions/alexa ndria-ocasio-cortez-jeremy-corbyn-politicalmodel-maltby/index. html © 2018 CME Group. All rights reserved. 14
The New Yorker Magazine, 2019. Cartoon poster purchased for use. © 2018 CME Group. All rights reserved. 15
Part II: Brexit the Play – Economic and Market Lessons © 2018 CME Group. All rights reserved. 16
Phase Transitions Add Tremendous Complexity In physics, a change from a liquid to a gas is a classic example of a phase transition. There is seriously chaotic behavior at the boundary between two different states. Royalty Free Stock Images: Boiling water in an ovenproof dish ID 32502199 © Roae | Dreamstime. com © 2018 CME Group. All rights reserved. 17
1 8 Pafnuty Lovovich Chebyshev 1821 – 1894 Source: https: //en. wikipedia. org/wiki/ Pafnuty_Chebyshev © 2018 CME Group. All rights reserved.
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2 1 Same mean and standard deviation, yet very different risk management implications. © 2018 CME Group. All rights reserved.
The pendulum of strategic planning is swinging toward the culture of agility and away from detailed scenario planning (still important, just less important). © 2018 CME Group. All rights reserved. 22
© 2018 CME Group. All rights reserved. 23
2 4 Thank You Stay in Touch for Further Economic Videos, Articles, Podcasts Website cmegroup. com/putnam cmegroup. com/research Email cmegroup. com/subscribe Linked. In www. linkedin. com/showcase/marketinsights/ © 2019 CME Group. All rights reserved.
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