What does Brexit mean for the UK, London, and NYC? Will McConnell allow a US stimulus payment vote?
Brexit will be here on January 1st. What big changes are coming?
There are a lot of big changes coming. Most important for the average Brit is the fact that you no longer can work or have education access in the European Union. You have to apply with normal immigration patterns, as you would outside the EU. That's going to change the way people think about their future. But otherwise, a lot greater regulatory impact, declarations of customs for goods being transmitted, so the cost of trade is going to go up with the world's largest common market. You know, the idea of I mean, for financial markets is very important because you have financial groups that are losing automatic access to the single market in the EU as well. They're supposed to be new deals cut around that, but we aren't there yet. It's not a disaster, but the fact that all these changes are happening immediately, and they are a significant cost primarily on the smaller economy of the United Kingdom and that they're going to have to be borne at a time when the economy's not doing well, when coronavirus hasn't been handled very well, when global demand is already depressed, this is a big hit, and it's a big hit also on the back of almost five years of uncertainty around the UK.
I think one of the most interesting things is London is not going to be seen as as much of a global city. As someone who loves London personally, I think that's sad. But it's also really interesting because when you think about truly global cities in the world, I've thought Hong Kong, for example, certainly not any more with what's happened from the mainland and the introduction of the national security law. London really hard to say given what they've just done in the UK to limit connections with the European Union. There's in general lots of fragmentation in the world, globalization and globalism has taken it on the chin. I think this helps the United States, the world's largest economy, and it helps New York City because there is still a desire for financial markets, for global creatives, for talent and wealth to come together in places. Tokyo is an incredibly well functioning, really big city, but it's so much more homogenous. Beijing is an incredible place with a massive amount of dynamism, energy and wealth, but it's also in an authoritarian system and a reasonably closed marketplace. It just can't be global. So, I actually think that New York City is comparatively speaking, going to do a lot better as a place in terms of energy, momentum, ideas and wealth, even though in the coronavirus period, people have been leaving New York, L.A., Silicon Valley for places that are cheaper. I would be betting long on places that are global, especially in an environment that's going to be more unequal going forward and first tier cities doing well.
Are $2000 stimulus payments back on the table in the United States?
If McConnell decides that he is willing to put it to a vote, the answer is maybe, but I have a hard time seeing him do that personally. Keep in mind that that would be a gift to the Democrats who have been supporting this without taking away any of the other bits of the bill, the rescission that President Trump has demanded, the pork and spending that has come somewhat from Republicans, somewhat from Democrats. I think McConnell still believes that the way he exercises power is by determining the political agenda and only providing opportunities for things that he and his party supports. Now, there is the complication of the Georgia by-election and both of the GOP senators who are running in that by-election, Perdue and Loeffler have come out surprise, surprise, in favor of the $2000 stimulus, the checks, individual checks, for again, for everybody that that makes under a certain amount, and that's useful for them because they're running, it's politics as usual, but I don't think that necessarily makes McConnell any more likely to put it on the agenda. In fact, given the fact that politics are generally local, they get to say they supported it, they're not going to take a hit from the fact that it doesn't actually pass. So, I think it is effectively a nothing-burger. It's Trump saying that he pushed hard for those checks, for people's money in their pockets, and it was taken away. And if he wants to have a fight with McConnell, he certainly can.
Happy New Year. What does the world in 2021 look like?
I will not tell you that right now. I will tell you that next week you should all tune in for our top risks. We do it every year. And it is well in place. There is an enormous amount of work that goes into it. We will be putting it out on Monday, January 4th. And there's going to be a livestream to talk about it at 12:00 noon Eastern Standard Time. You can watch on gzeromedia.com and all of our social media accounts. I look forward to seeing all of you then. Happy New Year to everyone.