Roller coaster towards a very volatile end of the year in the Stock Market | Markets

We are not talking about black swans about the future of the Stock Exchanges. At the moment there are no surprises like the one used by the economist Nassin Nicholas Taleb to develop this theory when it was discovered in the seventeenth century that black swans existed in Australia. The financial world faces a very specific calendar of uncertainties: the evolution of Covid-19, Brexit or the US elections in November. These certainties are mixed with the evolution of oil in the coming months, the march of inflation, the valuation of the markets and how far the growth of the public debt goes to face the ravages of the pandemic. And the money in the Stock Market has begun to get nervous before this panorama until the end of the year.

In this September there have been important falls dictated from the US Stock Exchanges and in recent days the sessions have been splicing down. The Nasdaq technology has a 9% drop in the month, while the Ibex 35 falls more than 5% and the EuroStoxx 50 loses 4.5%. What do the experts think about what can happen with these uncertainties that weigh on the market? How will they condition the future of the Stock Exchanges? The head of investment strategy of the manager Martin Currie (Franklin Templeton group), Kim Catechis, is clear in his answer: “The picture is ugly, very ugly”. And of course, Covid-19 leads the danger to the world of money.

The pandemic is out of control again

Catechis believes that investors have not realized that the pandemic is rampant in the world. Furthermore, she complains that unlike central banks that show enormous cooperation, governments are each on their own, with the exception of the Eurozone. This situation will bring strong volatility to the Stock Exchanges that will only disappear when an effective vaccine against the virus arrives. But it also qualifies optimism about the vaccine: “when it is discovered, it would take about 18 months for it to reach the entire population. Ideally, there should not be a single provider of the remedy but 4 or 5 available that shorten this period. Of course, as the Stock Market anticipates events, when an effective vaccine is presented the rally will be very pronounced, ”he explains.

This second wave of Covid-19 is for Félix López, the managing partner of Atl Capital, the greatest uncertainty for the Stock Exchanges, with an exponential growth in the contagion curves. “Confinement is the only effective solution until a vaccine appears. Now we know the consequences and monetary and fiscal policies have been put in place that will soften the impact that we saw in March ”, he indicates. And he explains that, when it comes to investing, the Stock Market is less expensive than, for example, fixed income.

The second wave of Covid-19 is less harsh than in March but the contagion skyrockets

Patrik Lang, director of global equity strategy at Julius Baer dares to quantify the punishment that Covid-19 can represent on the S&P 500 (it has fallen 7% in September): “we don’t see much more than 10% to the It is down from current levels in the S&P 500 and we do not expect a sustained decline below 3,100 points. The market should bottom out in October. ” And this vision is based on the measures (tests, tracing, closing of premises, masks) that are more efficient, that fatal cases have not increased significantly in Europe and that new infections are mainly due to more social activities. than economic, which questions the need for business closures ”, he concludes.

Towards a hard and no-deal Brexit

The UK’s FTSE 100 index is down over 20%, while the Euro Stoxx 600 index is down just over 11% so far this year in sterling and euros respectively. If we compare the two in euros, the UK fares even worse due to the weakness of the pound relative to the euro, while the December 31, 2020 deadline to agree on the terms of their future relationship is fast approaching.

Mobeen Tahir, Associate Director of Wisdom Tree, explains that although the pandemic is causing more economic damage to the UK than to Europe, the Brexit factor cannot be ignored. The European Union (EU) accounts for 43% of all UK exports and 51% of all UK imports. The UK’s share of EU trade is not negligible as the UK accounts for 14.9% of all EU exports and 10% of all EU imports. The breakup without a conducive trade deal will put the UK’s exports at a competitive disadvantage and affect it far more than the EU.

The US presidential elections will be, together with the virus, a great source of uncertainty

“Risky politics and deception have been typical features of every stage of Brexit negotiations and a last-minute deal is still quite possible. Any deal that is struck at the last minute is likely to be fairly narrow in scope, focusing primarily on avoiding tariffs and quotas in manufacturing. That would amount to a pretty tough Brexit, ”explains Paul O’Connor, multi-asset manager at Janus Henderson, who sees the decline in sterling as just a beginning.

Another Trump victory, better for stocks?

The analysts consulted agree that a victory for Donald Trump in the presidential elections of the United States on November 3 would favor the Stock Exchanges due to their pro-business policies, which are reflected in less taxes. Even so, they also consider that Joe Biden will be the winner of these elections. They also point to these elections as the factor of most volatility for the Stock Exchanges after the Covid-19 march. Kim Catechis disagrees with this general view, as polls say Republican voters will go to the polls en masse, while Democrats will opt more for the mail-in vote. “This will cause a shadow of doubts about these elections with its reflection in the markets since the total count could end in mid-December”, adds the head of investment strategy of the manager Martin Currie (Franklin Templeton group).

The team of the manager Natixis IM Iberia bets in a majority way for a victory of the democratic candidate Joe Biden that, although it may be favorable for the economy and world trade, it will not be so so for the Stock Exchanges, contrary to what would happen with a eventual reelection of Trump, given the pro-business and tax-cutting nature that characterizes the Republican Administration.

Didier Saint-Georges, member of the strategic investment committee of the manager Carmignac, points out that the biggest problem could be the uncertainty surrounding the electoral process, with a very tense internal climate in the debates, and a possibly even result that opens the doors to fierce challenges. “Projected tax increases could moderate and, conversely, spending on infrastructure would be a typical Keynesian measure. Biden’s commitment to renewable energy worries the traditional energy sector, while the population support approach would favor the consumer sectors ”. And he adds: “The position vis-à-vis China would certainly remain very firm, albeit more peaceful, but the most notable shift could occur vis-à-vis Europe, towards a less threatening and more cooperative relationship,” says Saint-Georges.

Finally, Mona Mahajan, US investment strategist at Allianz Global Investors explains that “President Trump and former Vice President Biden have markedly different views on corporate tax, energy and trade between the United States and China, which they can have a substantial impact on markets and on investors’ portfolios ”. And she adds: “emerging technology (including 5G, artificial intelligence and cybersecurity), infrastructure and clean energy can have strong prospects after the elections.”

Nasdaq’s beacon, tech bubble?

In the medium term, other unknowns remain, especially the one related to how the high public deficits will be financed that will be inherited from the huge debt issuance with which the response to the pandemic is taking place. But on the near horizon there is concern about the valuation of Stock Exchanges with very different evolution, in which the technological indices rise with little pause and where the polarization between the winning and losing sectors of the crisis is increasing: disruptive companies linked to health versus the old economy.
Patrik Lang of the Julius Baer bank rules out that the rally in tech stocks will lead to a tech bubble. “In Europe and the US, the sector trades at a 30% premium compared to the market in general. This is in line with the average of the last 20 years and is due to the strong growth of the earnings of the sector, of around 20%. ” In addition, “the decisive factor today is whether companies will be able to maintain their strong earnings growth and we assume that this will be the case in the coming years and that, therefore, valuations will be sustainable,” he concludes.

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Johnson asks Parliament to support his law to negotiate with Brussels

The British Government’s bill that gives its ministers powers to unilaterally change the application of the European Union Withdrawal Agreement, signed in January, has advanced in its parliamentary process, after passing the first vote in the House of Representatives. Common

Criticism by former prime ministers and notable conservatives of the bankruptcy of an international treaty resulted in a victory for the prime minister by 77 votes (340 to 263), a loss of 3 over his majority. But thirty conservative deputies abstained and two voted against.

Boris Johnson encouraged MPs not to repeat the mistakes of the past by weakening the Government in its negotiations and to defend the territorial integrity of the United Kingdom. He also mentioned weapons. “Our interlocutors,” he said, “maintain the possibility of blocking the transport of food and agricultural products within our country … The EU has not removed that revolver from the table.”

The law focuses, in its articles on Northern Ireland, on the elimination of procedures to send goods and services from the region to other parts of the United Kingdom and on absolute independence to subsidize their companies. The EU revolver would however target trade from Great Britain to Northern Ireland.

The EU, complained Minister Michael Gove, does not give in on fundamental issues and postpones the inclusion of the United Kingdom in the list of countries authorized to export agri-food products to the EU market. It is a pending decision, according to Commission negotiator Michel Barnier, for London to define its future sanitary and phytosanitary regulations.

As an EU negotiating maneuver, a threat of blockade would be clumsy, because it would perhaps require the use of weapons. Customs and inspectors from the British government, which has not allowed the Union to establish a headquarters in Belfast, would have to implement orders from Brussels on the territory of Northern Ireland, forcing the province to import food for its supermarkets from other countries.

Johnson put the stamp of its incoherence stating that “it seems so incredible that the EU can do that that we are not regulating in this bill the powers to neutralize such a threat.” He softened the tone of recent days to avoid rebellions in his party, stating that he does not want to use the powers of the law but to reach an agreement. The threat of breaking the law would be a mere tactic.

The chairman of the Justice Commission of the House of Commons, the conservative Bob Neil, reminded him that Article 16 of the Northern Irish Protocol already offers him what his law contains. “If its application leads to serious economic, social or environmental difficulties that could persist, the Union or the United Kingdom can take appropriate safeguard measures unilaterally”, the text says.

Unionismo

The family of Labor leader Keir Starmer has had to isolate themselves while receiving coronavirus test results. He was replaced by Ed Miliband, who lost the 2015 elections to David Cameron. He has since been recalled that the conservative campaign portrayed him as a candidate who would create chaos. But the ‘Brexit’ of the Conservatives has greatly shaken British politics.

Miliband, caricatured by his somewhat robotic ways – he was photographed eating a sandwich with apparent technical difficulties – has freed himself body and soul after losing power. He ridiculed Johnson in a brilliant retort at times. The leader who agreed to what he described as a “great agreement” and forced the candidates in the December elections to commit to his defense, now renounces the Agreement.

“Either he wasn’t honest with the public or he didn’t understand it,” he told her. “Such incompetence! It is his agreement, it is his botch, his failure, for the first time in his life he is going to have to take responsibility.” And he also told him that his law, which breaks the law to save, according to Johnson, the 1998 peace accord in Belfast, “is not legislative hooliganism on any matter; it is about the most delicate matter of all.

Johnson was supported in the debate by a pro-British unionism in Northern Ireland in a state of great weakness. He supported ‘Brexit’ against the majority of the region, he allied with the most extreme Eurosceptic to defeat May, he entertained Johnson as the new leader, they described his Agreement as a betrayal and now they support him; even if he says he wants an agreement that would be the consummation of the betrayal.

The Internal Market bill now goes to its debate phase in committee, formed by the plenary session of the Commons. Two sessions will be devoted to it this week and another two next. It is possible that the Executive accepts an amendment to appease its parliamentary group. Then it is the turn of the House of Lords, where the opposition to the law is more numerous. You could use your limited powers to thwart your approval.

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England: Photo album of bizarre things from everyday life

Europe Found objects

Everyday life in England looks so bizarre

Our author was traveling in England. There some things that he saw surprised and amused him. His commented photo album paints a slightly different picture than a classic travel guide.

| Reading time: 3 minutes

British staring at puddles

The British are crazy. And that’s what we mean lovingly. In this video from Newcastle, passers-by try to cross a puddle. Under the attentive gaze of countless English Internet users.

Resistant sinks

WITHu The quirky traditions that even 46 years of EU membership have not been able to eradicate include the typical English sinks with separate taps: on the right, ice-cold water comes out of the tap, on the left, you scald your hands under the boiling hot jet. These sanitary relics are still in use in an alarming number of washrooms in restaurants and hotels.

Typical in England: wash basins with separate taps

Typically English: wash basin with separate taps

Source: Sönke Krüger

The discipline of the English

The Englishman shows true civilization and admirable discipline on the escalator – walk left, stand right. Works perfectly in London, nowhere in Germany.

Escalator in England

Source: Sönke Krüger

The Brexit debate strengthens national pride

Since the Brexit vote, a national surge in the English food industry has been observed, with the Union Jack emblazoned on more and more British supermarket packaging.

So also on these sugar bags, on which the flag says: “proudly grown in Britain” – somehow tragic that the national pride now even extends to sugar beet.

Sugar in a supermarket in England

Source: Sönke Krüger

Optical illusion in the supermarket

For those who find Brussels sprouts disgusting, the English have developed a splendid alternative – chocolate balls, wrapped in green foil, which perfectly imitates the appearance of the Brussels sprouts. Like real Brussels sprouts, the fake cabbage is delivered in the green network and is regularly sold in specialist shops in the run-up to Christmas.

Chocolate in a supermarket in England

Source: Sönke Krüger

England’s press does not shy away from taboo subjects

It’s always worth rummaging through English magazine shelves. There is something for every taste. Even taboo topics are illuminated in detail in glossy magazines.

Magazines in England

Source: Sönke Krüger

Puppet theater with Theresa May and Boris Johnson

For once, ex-Prime Minister Theresa May and her successor Boris Johnson can be seen in good harmony: as dogs’ dolls. One or the other Brexit opponent is likely to have obtained the material duo for their own use – either to vent political anger or to use them as a voodoo doll, because if Britain’s EU whereabouts cannot be achieved with arguments, then maybe with pinpricks.

England: Ex-Prime Minister Theresa May and her successor Boris Johnson as dog dolls

Source: Sönke Krüger

Hate or love – the spread divides

Marmite, invented in 1902, is made up of decomposed yeast cells and tastes like that too. The biting salty-spicy spread divides the nation, which the manufacturer (advertising slogan: “You love it or hate it!”) Deals with humorously.

One spot, for example, shows a nursing mother who gleefully bites into a toast with marmite, whereupon her baby vomits indignantly. Lovers can now find marmite-flavored nuts in the supermarket.

Marmite in a supermarket in England

Source: Sönke Krüger

Degenerate into royal junk

Prince Harry and Meghan, Duchess of Sussex, were considered the new popular figures in the after their wedding in 2018 Royal Family. Has your reputation been scratched in the meantime?

Duty free shelf at London Gatwick Airport

Source: Sönke Krüger

A look at the duty-free shelf at London Gatwick Airport reveals this. There the couple stayed to decorate the cookie jar and are being sold for a special price (two cans of 22 pounds). Even the motto “Best of British” is of no use anymore: The shine is lost.

This article was first published in October 2019.

The text comes from WELT AM SONNTAG. We will be happy to deliver them to your home on a regular basis.

WELT AM SONNTAG from October 20, 2019

Source: WamS

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German conservatives see rewards in the Rhineland for their management of the coronavirus

BY JUAN CARLOS BARRENA

The ruling German Christian Democratic Union (CDU) has seen its management of the coronavirus epidemic rewarded and its political hegemony confirmed with a clear victory in the municipal elections held this Sunday in the federal state of North Rhine-Westphalia (NRW), the most populous of the country. The CDU obtained 34.3% of the votes in that state and, although it yielded slightly more than three points compared to the 2014 elections, it significantly increased its advantage over its most immediate follower, the Social Democratic Party (SPD), which fell from the 31.4% to 24.3%. Winners of the day were Los Verdes, who improved their result by more than eight points to 20.0%, while the Liberals (FDP) obtained a modest 5.6%. For their part, the ultranationalists of the Alternative for Germany only achieved 5.0% of the votes, mired in a deep internal crisis and unable to derive political benefit from the Sars-Covid-2 pandemic.

The result ratifies the policy to face the coronavirus crisis of the federal chancellor, the conservative Angela Merkel, and is a boost for her fellow member Armim Laschet, prime minister of the NRW and candidate to succeed her as head of the German executive. “This election is also the recognition that the path of moderation and balance in the fight against the pandemic has been, is and will be the correct one,” Laschet said. The elections in the region with the longest working-class tradition in Germany have meant, on the contrary, a new electoral setback for the SPD, which, although to a large extent determines the policy of Berlin as a junior partner of the grand coalition led. The important rise of the Greens also confirms its growing importance as a possible partner of government in Berlin. At the national level, the Greens outnumber the SPD in polls and are for the electorate the partner that conservatives must choose after the legislative elections within a year.

The Bavarian authorities have threatened severe punishment for a 26-year-old woman, who is blamed for a massive contagion with dozens of infected in the German town of Garmisch-Partenkirchen. “If it is confirmed that the woman ignored the quarantine, despite suffering clear symptoms of coronavirus, she must have a significant penalty,” says the Bavarian Interior Minister, Joachim Herrmann, in the Münchner Merkur newspaper, who demands “exemplary punishment for so much disregard for others. The woman was recently partying at night in several bars and places in the Alpine population where it is presumed that she infected dozens of people. “The lady had symptoms, she was with us taking a test and was ordered to undergo quarantine until the result was known, which she did not do,” said a spokesman for the Bavarian health authorities, who presume she is the cause of the strong coronavirus outbreak in Garmisch Partenkirchen. After returning from a vacation in Greece, at the hotel where she works, she also infected at least 24 people, according to the case tracing carried out by the local health office. It is not ruled out that if any of those infected dies they could be charged with reckless homicide, as has happened with a similar case in East Frisia, a region on the German coast in the North Sea.

United Kingdom

Upset with test management when the ban on meeting more than six people begins

  BY iñigo gurruchaga

BY iñigo gurruchaga

The inclusion of children under 12 years of age in the government order that prohibits meetings of more than six people from this Monday and the capacity problems of the laboratories that analyze the tests are reasons for discomfort by the management of the Ministry of Health, in a context in which scientific advisers point out that the number of positive cases is doubling every week.

In Scotland and Wales, gatherings of more than six people, indoors or outdoors, have also been banned, but children under 12 are excluded from the account. Leading conservative deputies are asking the government to rectify, but the ministry insists on keeping the “rule of six” strict, because it would give clarity on the rules that must be met.

Some 185,000 tests were waiting in laboratories on Friday to be analyzed, according to documents leaked to ‘The Sunday Times’. Tracking system managers send tests to laboratories in Germany or Italy to alleviate the traffic jam. The Government says there is a capacity for 375,000 daily tests, but according to official figures about 225,000 are done.

The number of tests is high compared to other European countries. The Government has blamed the traffic jam on the growing demand for people who do not have symptoms, when the tracking system gives priority to tests in regions where there are acute outbreaks of infection and among health personnel and nursing homes.

The Association of Doctors of the United Kingdom (DAUK) has, however, produced a dossier, published by ‘The Guardian’, in which a GP with symptoms, working in Margate, in the south-east of England, was informed by the tracking system that the nearest test could be done in Leeds, in the north. The round trip would be about 850 kilometers.

The suggestion of traveling very long distances to take a test has given many examples in recent days, Hospital doctors also explain in the DAUK dossier their waiting days to achieve a test in a facility close to their workplace and the need of isolation waiting to receive the results. The Government’s objective is that the results are delivered in 24 hours, but in 25% of tests they do not arrive in 48 hours.

France

They detect a dozen sources of contagion of covid-19 in French universities

The French health authorities have detected “more than a dozen sources of contagion” of covid-19 in several universities in the country, which has forced some of these centers to temporarily suspend face-to-face classes, as confirmed on Twitter by Frédérique Vidal, French Minister for Higher Education, Research and Innovation.

Despite the fact that some higher education institutions have not yet started classes, the virus is already very actively circulating among French university students. For this reason, Vidal appealed to “individual responsibility in order to limit the spread of the virus.”

The minister explained that, according to the available data, the new infections among students would be «mostly linked to private meetings (student parties, privatization of bars …) and associated with a relaxation of sanitary instructions, especially measures prevention personnel ».

Vidal urged university students to remain vigilant and to respect, both outside and inside the classrooms, personal preventive measures: frequent hand washing, coughing and sneezing on the inside of the elbow, keeping physical distance, wearing masks and avoiding large meetings.

According to the France Bleu radio chain, 43 cases of covid-19 have been detected in the University of Rennes 1. Most of these infections would have taken place at parties in bars in this Breton city, according to the Regional Health Agency. Last week, coronavirus cases were also detected at the universities of Lille, Aix-Marseille, Bordeaux, Nice and at the Sorbonne Paris North.

On the other hand, today the prefectures of Marseille, Bordeaux and Guadeloupe are expected to announce new measures to deal with the increase in covid-19 cases, as requested by Prime Minister Jean Castex on Friday in light of “the worrying evolution” of the epidemic in these territories.

Castex resumed his political agenda on Monday, after being confined for a week in Matignon, the official residence of the French prime minister. Castex isolated himself after having been in contact with Christian Prudhomme, director of the Tour de France, who tested positive for coronavirus. The two PCR tests the Prime Minister underwent came back negative.

In Europe, France is the third country with the highest number of deaths from covid-19 (30,903 deaths), behind the United Kingdom (41,717) and Italy (35,610). Spain ranks fourth in the European ranking with 29,747 deaths, according to data from Johns Hopkins University in the United States.

Russia

The head of Health blames the increase in infections in Russia after the holidays

  BY rafael m.  manueco

BY rafael m. manueco

The return of the holidays is, in the opinion of the Russian Minister of Health, Mikhail Murashko, “the cause of the increase in the incidence of covid-19 in some regions of Russia.” Speaking to the “News of the week” program of the Russian public channel Rossía-1, Murashko said on Sunday that the affected regions, whose specific names he did not reveal, “are distanced from each other”, which is why the infections had different origins. That is, in his words, “they were due to the return from vacation.”

Murashko also did not clarify whether those infected who returned to their places of usual residence did so from other areas of the interior of the country or from abroad. The resorts on the Black Sea coast, Sochi in particular, have been sources of coronavirus infection from where it has spread to other parts of the country.

The same has happened in relation to Moscow and Saint Petersburg, the two cities with the highest incidence of the disease in Russia and which also receive a lot of inland tourism. On the other hand, the bulk of outings to spend the summer outside of Russia are mainly concentrated in Turkey, from where Russian tourists infected with covid-19 have also returned.

In any case, the Minister of Health said that, despite the rebound detected, “the situation of the pandemic in the whole country is stable.” He also reported that in Russian hospitals there are currently 90,000 patients admitted for covid-19 and 217,000 people are under medical supervision.

During the month of August, the daily number of infected fell below 5,000. Then he experienced ups and downs and now in September he is pulling up again. Since yesterday, Sunday, 5,509 positive cases of coronavirus have been detected, which are 60 more than the previous day and constitutes the absolute record since last July 30, when 5,509 infections were also recorded that day.

Russia remains the fourth country in the world with the most cases of covid-19 since the beginning of the pandemic. It already records 1,068,320 infected, 18,635 deaths and 170,985 active cases. In Moscow, the territory with the highest incidence of the disease in the whole country, 696 new infections have been detected since yesterday Sunday, which is 46 more than the previous day. The total number of infected in the Russian capital currently stands at 271,793 people and the number of deaths at 4,993. In Moscow there are still 36,403 active cases.

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London now fears no deal Brexit

While the government of Boris Johnson is struggling to reduce the growing infections in the country and to cushion the economic consequences of the pandemic, there is a crisis at the gates that could give a much harder blow to Parse: the risk of the No Deal in the Brexit negotiations. An exit from the European Union without an agreement could have catastrophic consequences for the country, far more serious than the coronavirus, to which would be added a heavy slowdown in the trade of goods due to border controls, with the prospect of finding lines of seven thousand trucks in waiting to embark in the port of Dover.

A study commissioned by the anti-brexiteer UK think tank in a Changing Europe and carried out in collaboration with some researchers from the London School of Economics (LSE), states that the price to pay for a possible No Deal would be destined to reach a lesser in the long term. 8% of GDP in the Kingdom, equal to 160 billion pounds or 2,400 pounds per capita Figures even higher than the Bank of England forecasts relating to the impact on the country of the spring lockdown and other restrictions related to the Covid-19 pandemic, which stop at less than 1.7% of GDP in 2022, after a presumable rebound partial positive.

The analysis was released as talks on future post-Brexit trade relations resume in the British capital between teams led by chief negotiators Michel Barnier and Lord David Frost: talks that have stalled for some time on several crucial points and are now threatened by the furious reaction of the ‘EU to the bill outlined by the government of Boris Johnson which claims the United Kingdom an alleged right to question part of the divorce agreements already reached in the Withdrawal Agreement, in particular on the delicate customs status of Northern Ireland.

As if that weren’t enough, the Guardian revealed yesterday that the government forecasts could have seven thousand trucks blocked in Dover waiting to enter France in January, with delays of two days in the regular transit of goods from the United Kingdom to the territory of the European Union, caused by the checks that will become necessary again. The catastrophic scenario, later confirmed to the municipalities by the government undersecretary himself, Michael Gove, responsible for the preparations for the exit, could take place regardless of the outcome of the ongoing negotiations for the new trade agreement between London and Brussels. According to Gove’s forecasts, the main inconveniences would derive from the unpreparedness of British exporters in the face of the controls that will come into force on January 1st at the EU borders.

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Downing Street predicts that between 40 and 70 percent of trucks traveling to the EU will not be ready to pass the new border controls. In the case of trucks that will have to cross the Channel by boarding the ferries at Dover or traveling by train the Eurotunnel, estimates range from 30 to 50 percent. Furthermore, the funnel that would be created in French ports could cause the flow of goods across the Channel to collapse to 80 per cent of normal capacity. This is why Gove has asked the trade associations to “act now and prepare for the new bureaucratic formalities” that they will have to face starting next year. Drivers, British or foreign, traveling, for example from depots in the Midlands, will need to obtain a permit before arriving in Kent, the Port of Dover region, if they intend to board a ferry or Eurotunnel train.

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Corona management and Brexit dispute: Boris Johnson at the lowest point

“Where’s Boris?” Asks the “Spectator”, who usually always knows where the Prime Minister is and why he is being wrongly criticized. The traditional magazine was not only headed by Johnson for many years – it raved about Brexit early on and passionately promoted “Boris’” move to Downing Street. Now the editor-in-chief of the magazine is predicting an early end if he doesn’t get his position under control soon.

Johnson has undoubtedly hit rock bottom since taking one of the most triumphant electoral victories in Conservative history in December. In the polls, his lead over the battered Labor Party leader Keir Starmer has melted. For the first time in a long time, both parties are on par. No one can take away the full majority that Johnson has in parliament anytime soon, and his cabinet shows no cracks. But the grumbling in the party, especially among former admirers, is unmistakable. It can no longer be dismissed as the criticism folklore of frustrated “Remainers”. The balance sheet is finalized, and the Johnson loyalists insist, with good reason, that neither the corona pandemic nor the Brexit process have come to such an end. But so far, Johnson’s approach to these two major fronts cannot be described as otherwise than erratic and flawed. The man, who was chosen for his leadership and optimism, appears haphazard and erratic, some even say: broken.

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Boris Johnson’s internal market law takes another hurdle

Despite all warnings, Boris Johnson’s plans to change the EU Brexit deal continue to run through parliament. Not all critics are enthusiastic. But there is no longer any talk of rebellion.

The rebellion did not materialize: the controversial internal market law of the British Prime Minister Boris Johnson has cleared another hurdle in parliament. Johnson wants to use the law to partially nullify the current, laboriously negotiated Brexit deal with the EU. A majority of MPs approved a compromise between the prime minister and his critics in London on Tuesday, so that there was no longer a formal vote on their request.

Several Conservative MPs who had previously spoken out against Johnson’s plans also agreed to this. The head of government had previously taken a step towards the dissenters and had assured them a further vote in parliament in the event that the measures provided for in the law for an emergency should actually be used – in essence, what the rebels had asked for.

However, the compromise does not mean that there is now unity in the House of Commons. “I cannot support this law,” ex-Prime Minister Theresa May said in the House of Commons on Monday. The government is jeopardizing “the integrity of the United Kingdom” without considering the consequences for the country’s reputation in the world. The opposition railed against the government on Tuesday as “legislative hooligans”.

That’s what the law is about

The law is about special rules for the British Northern Ireland, which should prevent a hard border with the EU state Ireland and new hostilities there. Johnson wants to use the new single market law to undo several key provisions in the Brexit treaty on Northern Ireland. It is about the suspension of customs regulations in the trade in goods for Northern Ireland and of requirements on state aid for British companies.

For the EU, Johnson’s move is a breach of the law. Brussels therefore asked London to give in by the end of September.

After the MPs in the House of Commons had already voted in favor of the law last week and the compromise has now been approved, the final decision is still pending: In the coming week, the law will turn another round in the House of Commons then the House of Lords will debate it. If amendments come from there, it could even end up in the House of Commons again – a ping-pong game that could take weeks.

Critics fear that the planned law could be the fatal blow for the desired trade agreement between the EU and Great Britain, which is to regulate future economic relations. After the end of the Brexit transition phase, there is a risk of a hard break with tariffs and high trade barriers without a contract.

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“The UK could be sentenced to heavy financial penalties”

The cross : How does the UK’s Internal Market Bill conflict with the Brexit deal?

Emmanuelle Saulnier-Cassia: By the incredible admission of the Minister responsible for Northern Ireland, Brandon Lewis, the text drawn up by the government “Violates international law” even if he downplays by specifying that it would be “In a very specific and limited way”. It is unfortunate that the United Kingdom, the inventor of the rule of law, is coming to this kind of legal extremity, even if it is not yet clear whether this is an intention. real or a new bluff from the executive.

→ READ. Brexit: the British are dragging their feet and pulling out their claws

This UK Government’s Internal Market Bill aims to ensure that ‘People and businesses in Northern Ireland have unfettered access to the entire UK market’, according to Brandon Lewis. This would indeed contradict the Brexit agreement, which has the status of an international treaty. The latter cannot be revised, because legally, the withdrawal has already taken place since January 31, 2020. The United Kingdom is no longer a member state of the European Union.

The exit agreement guarantees the absence of a physical border between Northern Ireland and the Republic of Ireland, an EU member state, in order to avoid the resurgence of tensions in this region. This situation has the consequence of postponing customs controls, if no trade agreement is found between London and Brussels. London is preparing to pass a provision that says the opposite.

According to the President of the European Parliament, David Sassoli, London is at risk of “Serious consequences” from Brussels. What could these consequences be?

E.S.-C. : I will not address questions of confidence, nor the negotiations under way on the future relationship between London and Brussels, it is more a matter of politics. It is very difficult to read everyone’s intentions. From a strictly legal standpoint, however, things are quite borderline. The Brexit deal has specific terms and conditions, with an ad hoc dispute settlement mechanism.

→ DOSSIER. Brexit, all you need to know about the UK’s exit from Europe

In the event of a dispute, a joint committee must be consulted. If the disagreement persists, a “Special arbitration group” takes over and issues a binding opinion in connection with the Court of Justice of the EU. At the end of the day, the UK could face heavy financial penalties. It’s pretty hard to say how long that might take, since it would be a first, but things could go pretty quickly, if they go through the fast-track process.

The bill raises protest in the UK, including in Boris Johnson’s Conservative camp. Should we expect national litigation on this issue?

E.S.-C. : London is exposed to both British and European lawsuits. It is a safe bet that all the anti-Brexit lobbies are pooling their resources to hire the best lawyers, as they had been able to do previously to slow down or mitigate the withdrawal process. The case could go back to the Supreme Court.

There have often been attempts by successive governments to circumvent their commitments to the European Union. But judges have almost always succeeded in making Community law triumph on issues as diverse as environmental standards, maritime law, waste management, etc.

In 1990, a very significant case even enshrined the domination of the Court of Justice of the EU, by rejecting a law passed in parliament on the registration of fishing vessels for the benefit of EU law. This decision was quite heretical in British law!

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The EU demands from London the immediate withdrawal of its ‘Brexit’ law

The European Commission on Thursday demanded that the British Government withdraw before the end of September the bill that unilaterally changes customs procedures and the regime of state subsidies to companies in Northern Ireland. Likewise, he warned her that “she will not be shy” when it comes to going to court if she does not do so, in clear allusion to the Court of Justice of the European Union

The Commission published a statement in which it expresses this demand and underlines that the Johnson Executive has broken confidence in the negotiations on the future commercial relationship. The note was released after the meeting between the Vice President for Interinstitutional Relations, Maros Sefcovic, and the British Minister, Michael Gove, which the former urgently requested. “If the bill were passed, it would constitute an extremely serious violation … of international law,” Sefcovic said.

The bill has provoked in the UK the round condemnation of former Conservative leader and ‘Brexiter’, Michael Howard, in the House of Lords. Tory deputies expressed support for his words. The media have also expressed in editorials their concern about the drift of the London Government.

Johnson already issued an ultimatum this week for the negotiation of a trade agreement, naming October 15 as the last date for the deal. The response of the EU with another for the withdrawal of the bill makes the rupture of the dialogue more likely and that the United Kingdom ends the current transition phase with a ‘Brexit’ that is abrupt.

Minister Gove confirmed after the meeting that the Executive will not renounce the controversial law despite the fact that Johnson had a tense telephone conversation with the Irish Prime Minister, Micheál Martin. The change in the treaty would force the creation of a border between the two Ireland.

«Sistema dual»

The Attorney General of the State, Suella Braverman, Minister of the Cabinet, also published a statement in which she affirms that the “dual system” of the Constitution allows Parliament to modify international treaties with domestic laws. It is, according to Mark Elliott, Professor of Public Law at Cambridge, an “absolutely laughable” argument.

This train crash comes at a critical time for the stalled negotiations of the free trade agreement that should govern relations between London and Brussels as of January 1, 2021, after the end of the transition period.

For this reason, the British negotiators, David Frost, and European, Michel Barnier, also met this Thursday in London in order to analyze an eighth round of talks as fruitless as the previous ones. “Significant differences persist,” Barnier said again at the end of the meeting, but the EU remains committed to reaching a deal given the serious “practical, economic and social consequences of a no-deal break. In this way, at least for the moment, he removes the dreaded prospect of an end to contacts.

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Brexit, UK divided over Boris Johnson’s bill

►What does Boris Johnson’s draft law on the internal market contain, denounced by the European Union, the entire British opposition and many Conservative MPs?

This bill returns to several points of the protocol on Northern Ireland contained in the Brexit agreement negotiated last year with the EU. The latter provides that products sent to Northern Ireland from Great Britain and considered to be at risk of being subsequently transferred to the EU will be subject to European VAT.

→ READ. Brexit: the British approve a law breaking the agreement with the EU

According to the bill that the British Prime Minister wants to pass, London will unilaterally decide which products will be at risk. This also cancels out the need for exit declarations for goods traveling from Northern Ireland to Great Britain considered to be an attack on British sovereignty. Finally, London refuses that British companies selling their products in Northern Ireland are not subject to EU anti-dumping rules.

► Why are the Scottish and Welsh administrations so worried about the Internal Market Bill?

1is January 2021 will be the first effective day of the post-EU era for the United Kingdom: the arrangements negotiated until then between the United Kingdom and the Twenty-Seven will have ended the day before. Prerogatives, previously held by Brussels on behalf of the member countries, will therefore return to the hands of the British. This concerns agriculture, fisheries, food standards, environmental policies and some aspects of labor law.

The Home Market Bill, introduced by the Johnson administration, aims to repatriate prerogatives related to agriculture, fisheries and food standards to central government. It also promotes two principles: mutual recognition and non-discrimination. This means that a product whose sale is authorized in one of the four countries of the kingdom is also authorized in the other three – even if Northern Ireland remains a special case. According to London, the aim is to ensure that no barriers will hamper trade within the national market, as has been the case until now.

The Scottish and Welsh administrations, which are respectively in the hands of the separatists of the Scottish National Party (SNP) and the Labor Party, on the contrary fear a race to the bottom in terms of regulations. “Scotland may have to accept lower standards set by a British government seeking a trade deal with the United States,” fears Scottish Prime Minister Nicola Sturgeon. We could be forced to accept chicken washed with chlorine, for example. »

►What is the expected legislative process?

The House of Commons is now studying the text in detail after having ratified its second reading on Monday evening by 340 votes against 263. The upcoming discussions in its various committees and the vote on the various amendments are expected to be closer. Then it’s up to the House of Lords to review the text and make amendments. The text will then come back to the Commons.

→ DEBATE. Brexit: can we still hope for an agreement?

According to Anand Menon, professor of political science at King’s College London: “If the Lords manage to sabotage the bill by a strong majority, it may encourage hesitant MPs to do the same when they are considered in the Commons. “

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