1 00:00:03,240 --> 00:00:06,640 Speaker 1: Global business news twenty four hours a day. If Bloomberg 2 00:00:06,680 --> 00:00:09,760 Speaker 1: dot Com the radio plus mobile lap and on your radio. 3 00:00:10,039 --> 00:00:14,400 Speaker 1: This is a Bloomberg Business Flash from Bloomberg World Headquarters. 4 00:00:14,520 --> 00:00:17,720 Speaker 1: I'm Charlie Palette. Stocks are fluctuating right now. We have 5 00:00:17,800 --> 00:00:20,799 Speaker 1: got the SMP five hundred index turning higher. Now it 6 00:00:20,880 --> 00:00:23,960 Speaker 1: is up a point at two thousand seventy two, up 7 00:00:23,960 --> 00:00:26,840 Speaker 1: by less than point one percent. Down. Industrial is up 8 00:00:26,880 --> 00:00:29,920 Speaker 1: fifty four points now, gaining three tenths of one percent 9 00:00:30,000 --> 00:00:34,200 Speaker 1: to seventeen thousand, six ninety four. Nasdaq is down seven 10 00:00:34,240 --> 00:00:37,240 Speaker 1: to forty seven, a drop there of two tens of 11 00:00:37,320 --> 00:00:40,920 Speaker 1: one percent. The tenure down one thirty second, the yield 12 00:00:41,040 --> 00:00:44,560 Speaker 1: one point five seven percent. Gold up to forty to 13 00:00:44,640 --> 00:00:46,840 Speaker 1: twelve ninety a gain of two tenths of one percent. 14 00:00:47,200 --> 00:00:50,240 Speaker 1: And crude oil West Texas Intermediate it is down two 15 00:00:50,240 --> 00:00:52,920 Speaker 1: point six percent, down a dollar twenty five of barrel 16 00:00:53,280 --> 00:00:58,720 Speaker 1: forty seventy four. I'm Charlie Pallett. That's a Bloomberg Business flash. 17 00:00:58,800 --> 00:01:01,800 Speaker 1: You're listening to Taking Stock with Kathleen Hayes and Pim 18 00:01:01,880 --> 00:01:08,319 Speaker 1: Fox on Bloomberg Radio. Grexits remain? Will the UK vote 19 00:01:08,760 --> 00:01:12,840 Speaker 1: to leave the European Union just one week from today, 20 00:01:14,040 --> 00:01:16,200 Speaker 1: and if they do, what does it mean not only 21 00:01:16,280 --> 00:01:18,240 Speaker 1: for the United Kingdom but for the rest of Europe. 22 00:01:18,280 --> 00:01:20,920 Speaker 1: Jacob Kirkgard joined US now senior fellow at the Peterson 23 00:01:21,000 --> 00:01:25,200 Speaker 1: Institute for International Economics in Washington, d C. He has 24 00:01:25,200 --> 00:01:28,640 Speaker 1: been writing a great deal about fears over immigration and 25 00:01:28,680 --> 00:01:32,880 Speaker 1: what they and how they play into this Brexit vote. Jacob, welcome, 26 00:01:33,920 --> 00:01:35,920 Speaker 1: great to be here, but I actually want to start 27 00:01:36,160 --> 00:01:39,759 Speaker 1: by asking you, um, the death of UK opposition Labor 28 00:01:39,760 --> 00:01:45,200 Speaker 1: Party lawmaker Joe Cox today, killed by a man who 29 00:01:45,319 --> 00:01:49,360 Speaker 1: is in favor of leaving the European Union. Uh does 30 00:01:49,400 --> 00:01:52,520 Speaker 1: this Do you think this impact sentiment in the UK 31 00:01:52,800 --> 00:01:55,480 Speaker 1: at all on this vote? Oh? I don't think there's 32 00:01:55,480 --> 00:01:59,080 Speaker 1: any doubt that it will. I mean, I think we 33 00:01:59,080 --> 00:02:01,360 Speaker 1: we just have to be running the risk of being 34 00:02:01,640 --> 00:02:05,200 Speaker 1: very cynical here. But you have a forty two year old, 35 00:02:05,280 --> 00:02:09,280 Speaker 1: very photogenic mother of two killed as part of a 36 00:02:09,320 --> 00:02:14,200 Speaker 1: political process in a country that is highly unaccustomed to 37 00:02:14,960 --> 00:02:19,320 Speaker 1: political violence. So I think you'll have an enormous impact. Frankly, 38 00:02:19,400 --> 00:02:22,960 Speaker 1: I think it would be very difficult to restart the 39 00:02:23,080 --> 00:02:27,079 Speaker 1: campaigning again. You know, maybe after the weekend or something 40 00:02:27,120 --> 00:02:32,640 Speaker 1: like that without continuingly coming back to this issue. And 41 00:02:33,120 --> 00:02:37,079 Speaker 1: it will also, in my opinion therefore drive turnout at 42 00:02:37,160 --> 00:02:42,679 Speaker 1: the campaign on next to Thursday, because people will feel 43 00:02:42,760 --> 00:02:45,000 Speaker 1: very emotional about it. So I think this is this 44 00:02:45,080 --> 00:02:49,800 Speaker 1: is a really really big deal for this campaign. Jacob 45 00:02:50,200 --> 00:02:54,360 Speaker 1: paint as a scenario of leaving and staying and what 46 00:02:54,480 --> 00:02:58,919 Speaker 1: happens to the British economy in both scenarios, um well, 47 00:02:58,960 --> 00:03:03,040 Speaker 1: starting with the easiest of the two scenarios, which will 48 00:03:03,120 --> 00:03:07,360 Speaker 1: be if Britain votes to remain. In that case, I 49 00:03:07,400 --> 00:03:13,560 Speaker 1: would predict basically the majority of the status quo UH continues. 50 00:03:13,680 --> 00:03:16,520 Speaker 1: I think you would see a slight bounce back in 51 00:03:16,560 --> 00:03:20,440 Speaker 1: the second half of this year by the UK economy. 52 00:03:20,520 --> 00:03:24,360 Speaker 1: You will have a sort of pent up investments being released. 53 00:03:25,160 --> 00:03:28,480 Speaker 1: You would see a swing back in the value of 54 00:03:28,480 --> 00:03:32,880 Speaker 1: the pound and and equities etcetera, which have obviously been 55 00:03:32,880 --> 00:03:35,640 Speaker 1: weighed down by uncertainty. But at the same time, I 56 00:03:35,640 --> 00:03:40,160 Speaker 1: think the reality is that this campaign will have, especially 57 00:03:40,200 --> 00:03:44,920 Speaker 1: after today's tragic events, will have made or or made 58 00:03:44,920 --> 00:03:48,480 Speaker 1: the country split even more over the issue of immigration, 59 00:03:48,560 --> 00:03:51,880 Speaker 1: and that includes both the Conservative and the Labor Party. 60 00:03:52,240 --> 00:03:54,600 Speaker 1: So fundamentally, in the long run, the UK will have 61 00:03:54,640 --> 00:03:59,640 Speaker 1: become a more difficult place to govern after this campaign. UM. Now, 62 00:03:59,680 --> 00:04:03,440 Speaker 1: if there is a vote to leave UH, then I 63 00:04:03,480 --> 00:04:06,440 Speaker 1: am certainly in the camp who believes that this is 64 00:04:06,640 --> 00:04:10,120 Speaker 1: a very bad economic news for the UK, because I 65 00:04:10,160 --> 00:04:15,080 Speaker 1: believe two things will happen. First of all, given that 66 00:04:15,480 --> 00:04:20,480 Speaker 1: a Leave victory will be driven predominantly by anti immigration 67 00:04:20,600 --> 00:04:25,359 Speaker 1: sentiment UH, and that the lead campaign have essentially locked 68 00:04:25,400 --> 00:04:29,000 Speaker 1: themselves into a future, depending on who you ask there 69 00:04:29,120 --> 00:04:32,760 Speaker 1: of reducing net migration to the UK of between seventy 70 00:04:32,839 --> 00:04:38,279 Speaker 1: to UH. That is a low immigration future for the UK, 71 00:04:38,520 --> 00:04:42,800 Speaker 1: which is means is very bad for growth UH and 72 00:04:42,839 --> 00:04:45,560 Speaker 1: a lot of other things in the UK. Secondly, by 73 00:04:45,600 --> 00:04:51,040 Speaker 1: focusing so much on immigration, the UK has essentially ruled 74 00:04:51,080 --> 00:04:56,200 Speaker 1: out the possibility of securing a free trade agreement or 75 00:04:56,240 --> 00:04:59,880 Speaker 1: access to the internal market or any broader economic RelA 76 00:05:00,000 --> 00:05:04,240 Speaker 1: relationship would the rest of the EU, because the one 77 00:05:04,279 --> 00:05:07,680 Speaker 1: of the demands from the EU faily be that UH 78 00:05:07,839 --> 00:05:12,880 Speaker 1: you migration be allowed to continue. UH. So this is 79 00:05:12,880 --> 00:05:18,599 Speaker 1: a situation where, probably after about two years of UH, 80 00:05:18,640 --> 00:05:23,440 Speaker 1: potentially like the futile negotiations, the UK would simply drop 81 00:05:23,480 --> 00:05:27,640 Speaker 1: out of the EU and then simply trade with the 82 00:05:27,640 --> 00:05:30,039 Speaker 1: rest of the EU as any other member of the 83 00:05:30,160 --> 00:05:32,920 Speaker 1: w t O. So, Jacob, you know you say this 84 00:05:32,960 --> 00:05:39,520 Speaker 1: is primarily driven by an immigration anti immigration movement. However, 85 00:05:39,560 --> 00:05:42,840 Speaker 1: this has been going on for at least what at 86 00:05:42,880 --> 00:05:46,200 Speaker 1: least a decade, if not a generation. There had been 87 00:05:46,240 --> 00:05:48,840 Speaker 1: your skeptics for a long time. There have been many 88 00:05:48,839 --> 00:05:52,599 Speaker 1: people not just in in UH, in London or in 89 00:05:52,600 --> 00:05:55,920 Speaker 1: the UK who worry about sovereignty and actually trying to 90 00:05:56,000 --> 00:05:59,080 Speaker 1: turn over some power over the laws of your of 91 00:05:59,120 --> 00:06:02,840 Speaker 1: your land to a body that is not really your government. 92 00:06:02,880 --> 00:06:05,599 Speaker 1: I mean, is it really just immigration? I mean, or 93 00:06:05,640 --> 00:06:07,160 Speaker 1: do you think you've gotten as far if it were, 94 00:06:07,279 --> 00:06:08,720 Speaker 1: or are you saying, oh, this is the thing that 95 00:06:08,839 --> 00:06:12,599 Speaker 1: really heated it up lately. Yeah, No, this is essentially 96 00:06:12,640 --> 00:06:16,400 Speaker 1: the fuel. Anti immigration sentiment is the fuel that has 97 00:06:16,440 --> 00:06:21,760 Speaker 1: made this referendum close. You're absolutely right that there has 98 00:06:21,839 --> 00:06:27,000 Speaker 1: always been ever since the UK joined, a significant part 99 00:06:27,040 --> 00:06:32,400 Speaker 1: of the UK UH population and the representatives that have 100 00:06:32,480 --> 00:06:38,080 Speaker 1: been very strongly against you membership, but they have never 101 00:06:39,160 --> 00:06:43,960 Speaker 1: come close to being the majority. That is something that 102 00:06:44,440 --> 00:06:48,560 Speaker 1: is relatively recent and in my opinion, is overwhelmingly driven 103 00:06:48,600 --> 00:06:53,520 Speaker 1: by UH anti immigrant sentiment in significant parts of the 104 00:06:53,600 --> 00:06:56,800 Speaker 1: UK population. Thank you very much for sharing your thoughts 105 00:06:56,800 --> 00:07:00,760 Speaker 1: with us. Jacob Curecard is a Senior Fellow at the 106 00:07:00,880 --> 00:07:06,039 Speaker 1: Peterson Institute for International Economics in Washington, d C. You 107 00:07:06,080 --> 00:07:09,920 Speaker 1: can follow him on Twitter at j F Kirker Guard 108 00:07:10,400 --> 00:07:12,960 Speaker 1: and we want to thank him for his perspective on 109 00:07:13,240 --> 00:07:16,280 Speaker 1: what may or may not happen. We know that Brexit 110 00:07:16,400 --> 00:07:18,080 Speaker 1: is a vote that we will all be watching. We 111 00:07:18,120 --> 00:07:21,239 Speaker 1: will be covering it around the clock. UH twenty three 112 00:07:21,240 --> 00:07:24,200 Speaker 1: of June voters in the United Kingdom go to the polls. 113 00:07:24,440 --> 00:07:26,680 Speaker 1: I know, Kathleen, you've been looking at what's happening to 114 00:07:26,760 --> 00:07:31,880 Speaker 1: the US treasury market as a result of people mind safety. 115 00:07:32,200 --> 00:07:34,400 Speaker 1: Right now, the yield on the tenures one point five 116 00:07:34,520 --> 00:07:37,559 Speaker 1: seven the yield on the thirty years two point three 117 00:07:37,960 --> 00:07:41,679 Speaker 1: nine percent. You're listening to taking stock on Bloomberg Radio. 118 00:07:46,400 --> 00:07:50,520 Speaker 1: Op Co Health. It is a very successful biotech and 119 00:07:50,560 --> 00:07:54,760 Speaker 1: pharmaceutical company started by a doctor who has become a billionaire. 120 00:07:54,800 --> 00:07:57,280 Speaker 1: Philip Frost coming up on taking stock on Bloomberg Radio.