[Update: David Cameron is set to announce a resignation]
[Update: David Cameron has resigned! See more here]
We’re about to simplify this fascinating and scary moment happening before our eyes. We’ve taken a layman approach to the #Brexit situation, and yeah we could make it even better simplified, but we want to preserve a little context so pay attention.
As of a few minutes ago, Britain has voted to officially leave the European union. The Britain exit is dubbed #Brexit. Now how does that affect anyone and why should they care. Ordinary people like me or you, are we even affected?
Why did it happen?
It happened because people in Britain wanted some EU laws to change. The laws were related to immigration and a few minor things, but a lot of old people (over 50% of voters beyond the age of 50) decided that they were tired of the European Union. Eventually people pressured their prime minister, and he didn’t budge.
HOW AGES VOTED
18-24: 75% Remain
25-49: 56% Remain
50-64: 44% Remain
65+: 39% Remain#EUref
— Ben Riley-Smith (@benrileysmith) June 23, 2016
Eventually a referendum (big vote/meeting) was called between European Nations and 52% of citizens said they wanted OUT of the EU. Thus, #Brexit was born. Because Britain left.
First of all you’re screwed. Excuse me, but we all are.
Britain has decided to leave the European Union and this has just triggered a worldwide domino effect on many economies. Stock markets are predicted to severely drop, and banks in the UK will now struggle to receive money owed to them, causing even more of a topple effect.
There are several factors affected directly by this #Brexit
Mostly Brexit is damaging because of its domino effect on economies worldwide.
Is the world necessarily ending? It is not… But we don’t know yet. We’re on the verge of a recession happening in about 24 hours.
Up until time of publishing, NYSE hasn’t opened the stock market so the real adverse effects for the US economy hasn’t opened up yet.
Ways how Brexit affects everybody:
1. First you need to know a little about the stock market.
When you buy a Twitter share of say $5, and the share rises %5, you earn an additional 5 cents per share that you bought. Your worth is now $5.25, because you own ONE share, awesome. Keeping up?
2. Now the big sharks, they buy Dow Jones shares (for example) at $18,000 per share, and these people inject numbers like $50 million into their stock portfolios to buy multiple shares costing them 18k each. The moment their shares in the stock market drop by their individual value, they lose millions. And the people/companies who invested billions, lose billions.
[Update]: Tweet below showing the reality.
— BBG Billionaires (@BBGBillionaires) June 24, 2016
3. To explain even more, there are places called hedge funds and their sole duty is to manage the money of billionaires and large private companies. The hedge funds invest money for people and take a % of what is earnt. However, these Hedge Funds will have no billions to manage, as the billionaires will lose a whack ton of money. This trickles down to industries beginning to crash.
4. So yes, after these big sharks of the economy lose a lot of money, the sorority now penny pinches to survive. They sell assets – now worth nothing, they lay off middle class workers, and they repay loans that are being demanded for by banks. It’s mass hysteria as they try to not stay broke at any means necessary.
Basically, if you don’t understand anything as much as it as simplified, rich companies are about to lose millions and many middle class workers may be fired. Sorry to induce panic, but this is the magnitude of what may happen if the stock market crashes. It’s all a domino effect on industries.
Why is the stock market affected by brexit?
The stock market is affected by brexit because at the moment, places like japan has frozen their trading. The british pound sterling has dropped to its LOWEST POINT in 48 years. Investors lose confidence in the growth of economies like Britain, and pull their money out of stock markets everywhere, causing their values to drop. And the domino effect mentioned above starts to happen.
So people with mortgages that lose jobs, may struggle to pay them off and lose homes.
People who work as stock brokers, they’re on the line to not be able to work.
European banks are about to have a rude awakening as their assets are lost.
Immigrants are affected by the UK & Britain move as laws will become effective limiting their freedom to work in the near future.
The middle class especially is screwed over from the imbalance.
How long will this last?
It could be 5 months, it could be 5 years. Nobody knows.