From The Economist's Graphic Detail:
BRITAIN'S
decision to leave the European Union has sent shockwaves across the
financial community. On June 24th, the day after the referendum, shares
in Britain's FTSE 100 stock index fell by 3% and the pound hit a 31-year
low against the dollar. London's status as Europe's financial capital
is now under question and many fear the end of London's dominance as a
financial centre.
Difficult divorces are not new in Albion. 240
years ago, the Kingdom of Great Britain saw a different kind of Brexit:
the American revolution. On July 4th, 1776 America's newly-formed
Continental Congress ratified the Declaration of Independence, formally
separating ties with the British crown. While the geopolitical
consequences of Amexit are clear, relatively little attention has been
paid to the economic ramifications.
Wars as it turns out
can be costly: trade flows to and from Britain slowed and government
debt rose from 106% of GDP to over 150% by the end of the war. Investors
were worried: yields on consols (government bonds with no expiration
date) shot up two percentage points, while share prices fell and would
not recover until...MORE
