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Another election! Hooray!

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Well, next the pound will rise over the short-term. Why? Investors think this election means that May is more likely to pursue a so-called ‘soft Brexit’ . To retain some sort of membership of the European Union single market in return for a degree of free movement. Which is thought to benefit trade and be better for our economy. So Britain looks a bit healthier, more global investors want to ‘buy in’ to us, they need sterling to play here and so it gets a boost.

The downside of a healthier pound is that the big guys in the stock market tend to fall off the back of this. Why? Well it saps the foreign earnings of the largely multi-national businesses that hang out in the FTSE 100. So most of us will have our investment and savings accounts fall off in value this week.

Let’s take GlaxoSmithKline, one of the biggest British companies, as an example. They make a cool £10-ish billion a year from pill-popping Americans, compared to about £8 billion in Europe. But their $ US revenues are translated back into pounds for reporting. If the pounds surges, their dollar revenues look punier. And the share price here suffers. Expect a bumpy road for the FTSE over the next few months.

Aside from the distraction of our local politicians, and looking out more globally, there were some dicey numbers out this week in the US which I think make it worth keeping an eye on this market. It’s been pretty buoyant since Trump got in but I’m seeing some early signs that the Yankee soufflé could be losing its air…

Finally, as we move toward the weekend papers who will try desperately to make this election interesting, one of the only things which can liven this up will be the Comeback Kids. Vince Cable is coming back for the Lib Dems. Will dishy David Miliband pop back from the States? Which other political phoenixes are out there? And of course if that attempt fails, we could all pop to the pub in the East End which has the Theresa Mäygerbomb – a shot of Jäger in a pint of Blue Nun and dull our senses till it’s over!?

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