The Rearview Mirror: September 2017


Brussels: the third round of Brexit talks has been concluded with an almost embarassing result: if this would be a sport event, we could better define the final result as a tie. In fact, Michel Barnier said that no “decisive progress” has been made. On the other hand, the UK negotiator Davis highlighted the achievement of “concrete progress” referring to the agreement on Ireland and citizens’ rights. It became so evident that not only the perception on Brexit outcome amongst EU officials and UK ones is largely differing, but also the state of the works and quite probably the sense of urgency of a deal before March 2019 is divergent.

One of the favourite ties I have ever seen in my life, is the “Monty Python’s Olimpic Hide and Seek Final“. The game might appear useless at least because we are confrontated with a very prolonged and long-term game, a consuming time activity for the players as well as for the supporters. And a final tie (almost unlikely and fully unexpected) is the worst thinkable result because we need a replay to assess who is the winner.

Translating it into a successful Brexit deal, again any result is possible, even the most unlikely because we are in front of burocrates and more importantly because their objectives are not aligned. Perhaps they are sharing the same interest, they both are seeking stability. Nonetheless their point of view is completely different. It is the UK that has decided to leave the EU, while the European Union is aiming at preserving the status quo of their members and not solely at a pure negotiation for a future deal.

From the European Council guidelines for Brexit negotiations of the 29 April, it’s crystal clear that there is no room for “cherry-picking” and “no separate negotiations” are taken into consideration.

Certainly it is more a matter of money rather than a pure linguistic preservation vs. leaving opportunity issue. The EU needs to comply with the financial conditions of the current seven-year budget until the end of 2020. With the UK expected to leave in March 2019 we are talking about a difference of almost 17bn euro to be hedged. A reasonable bill that considers also these needs will be the viatic for the achievement of a good deal. Also, the Brexit supporters should accept it since now we are in front of a pure game theory case.

So, where is the tie result? Perhaps after these 2 years of negotiations, we will face a situation somewhere in the middle of the so-called hard and soft Brexit. But the game is getting real day by day and the new conditions will affect the life of millions of citizens, Europeans and British.


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Ha conseguito il Master of Quantitative Finance and Risk Management (MAFINRISK) presso l’Università Bocconi nel 2005 dopo essersi laureato in Economia degli Intermediari Finanziari presso la stessa Università. Dopo aver svolto attività di ricerca e tutoring in Portfolio management e Applied Econometrics presso l’Università Bocconi con il Professor Andrea Beltratti ha avuto modo di consolidare le nozioni tecniche ed applicarle sul campo durante l’esperienza in Mangart, Hedge Fund con strategia macro. Dal 2010, prima in Banca Euromobiliare Suisse e, in seguito ad acquisizione, in Banca Zarattini svolge attività di gestore Fixed Income ed Equity.


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