As the Scottish vote on Independence fast approaches I can’t help but be reminded by the famous “what have the Romans ever done for us” scene in Monty Python’s Life of Brian when Reg (John Cleese), leader of the “People’s Front of Judea”, tries to rally his fellow PFJ revolutionaries against the imperialist Romans, exclaiming “they’ve taken everything we had….and what have they ever given us in return?!”, to which his followers respond with all the good things Roman occupation has brought. After begrudgingly accepting the positives, Reg concludes: “All right, but apart from the sanitation, medicine, education…….what have the Romans ever done for us?”.
It is classic Monty Python but the reason I draw the parallel is because I believe the undecided Scots, who will ultimately decide the result, are more likely to err on the side of all the good things that have come with being British. I’m not Scottish so I can’t frame how a nation thinks, nor am I saying which way I would vote if I had the choice. I’m simply basing this on the fear of the unknown, the prevailing force that limits people. It is often why people don’t quit the job they dislike, why they stay in bad relationships, or why they rarely move outside their comfort zone in general. So I believe the undecided will sway in favour of the NO campaign, because what these people actually have under the current system will outweigh the uncertainty and inability to quantify the economic and social consequences that comes with the patriotic idea of a free Scotland.
While the market speculates on the impact of a Yes vote – consensus view being a weaker pound forcing the Bank of England to keep rates lower for longer – the biggest implication is that a stronger conservative government in England could pave the way for their own exit from the European Union. It is ironic given the rhetoric against the treacherous Scots looking to break away from another union. Ultimately though, it does raise questions about the fragility of our society, our economic and financial systems, if a nation of 5 million people choosing the right to self-govern can have the ‘cataclysmic’ impact on the world that is being foretold.
There is one warning that perhaps the Scots should heed. Legendary investor (speculator) George Soros, known as the “man who broke the Bank of England”, (he made a reported $1 billion profit in 1992 betting against Sterling as the UK government was forced to abandon the European Exchange Rate Mechanism) warned in the Financial Times last week against the break-up, reminding Scotland that “divorce is always messy”. The 84 year old does have some pedigree in this department, moving on to wife number three last year. In fairness though, George maybe should have added that divorce can sometimes bring benefits, like a Californian half his age. I’m sure it’s his personality and not his reported net worth of $24 billion!
Away from the market noise and the fear that Scotland may self-combust, the Champions League kicks off this week, easing the pain from Liverpool’s miserable display Saturday and the “new beginning” hype in Manchester. Luis Van Gaal has morphed back from devil to King, talking about the title after one win against a promoted team, akin to the Greek finance minister telling us to now “bet on Greece”. Still, King Luis has a week off to rejoice in his first premier league win as he watches the big clubs from his couch!