Viewing entries tagged
UK

FTSE 100: The Wrong Measurement

Many economic "experts" are fixating on FTSE 100 as the primary indicator of the UK's economy. When the FTSE 100 is down, they panic. When it rebounds, they rejoice.

The fact is: they are looking in the wrong place. The FTSE 100 measures the hundred wealthiest companies - not the 100 most innovative ones. The new, innovative, largely undiscovered small startups will be the drivers of growth in the UK's new, innovative economy. Those businesses are not part of the FTSE 100; most are not publicly traded at all. They are small startups that will be the next large job creators.

The majority of new jobs in America come from small businesses. The same is true in the UK, and will become increasingly true as the UK's economy moves away from large crony capitalists and towards entrepreneurial startups. New jobs in the UK will come from innovative small businesses, not from businesses that have the ability to get special favors from EU regulators.

Some economists have suggested that the FTSE 250, which looks at the 250 wealthiest companies, is a better measure. It might be, but not by much. The companies that will make the UK's new, independent economy great might show up in the FTSE 10,000 (if it existed). But in reality, most of those companies are not even publicly traded.

Some of the FTSE 100 companies are not even UK companies, and are headquartered elsewhere in Europe. Some of the fluctuations in their stock prices simply reflect the fact that without the UK, the lazier economies in Europe will lose one of their biggest crutches. In other words, if their stock prices fall, that doesn't necessarily show a lack of faith in the UK; they show a lack of faith the socialist economies in the rest of Europe. Investors realize that without the UK shouldering a huge portion of the burden (1/6th of the EU economy), the EU won't last.

A government bailout or similar "stimulus" will certainly help the FTSE 100 companies - at the expense of the innovative entrepreneurs who could actually build the economy. It amounts to replacing EU special privileges for large businesses with UK special privileges for large businesses. It creates unsustainable, bailout-based jobs, instead of meaningful, lasting, productive jobs. That's a lateral move at best.

Instead, the UK should reject crony capitalism, eliminate regulations on small entrepreneurs, and reduce the taxes that stifle innovative small businesses. That means more innovation, better products and services, and more real jobs.

If the UK can disentangle itself from the EU crony capitalism and UK crony capitalism, and move towards a capitalist and innovative economy, it will soon see a massive resurgence in jobs and economic growth. This will be true economic growth, without crony capitalist strings attached.

In Liberty

Arvin Vohra
Vice Chair
Libertarian National Committee

Freedom and Innovation or Bureaucracy and Slow Growth?

To All My British Friends,

Do you want freedom and innovation? Or bureaucracy and slow growth?

Tomorrow you will chose complete independence, or continued stagnation. You can continue to be dragged down by the rest of Europe's financial incompetence, socialist wastefulness, and meddlesome regulations. Or you can become Europe's prime location for innovation, entrepreneurship, business growth, and new jobs.

The investors who are nervous? Let them be nervous. They don't understand how innovation and entrepreneurship works. They don't know that if the UK leaves, it will become a haven for businesses seeking freer markets and fewer restrictions (i.e., all businesses). They don't know that a Brexit means more entrepreneurship, more jobs, and more growth.

The old, scared investors don't know what entrepreneurship is, or what innovation is. To them, business is just about numbers on spreadsheets. They have never experienced pioneering innovations, brilliant ideas, and the creation of new industries. They aren't entrepreneurs and visionaries. At best, they are financial parasites. At worst, they are the toxic advisors that make you afraid of becoming as great as you can be.

They say Brexit is a risk. Obviously. Innovation and growth always involve risk. In Silicon Valley, Los Angeles, New York, and London, great innovators take risks every day. Those risks create opportunities, jobs, and even entire industries.

Old and frightened investors may pull away from the pound sterling. So what? That just means British exports will increase in the short term.

As for the threats of retaliation from France: first, those are empty threats. They would hurt other countries far more than they would affect you. Realistically, you can expect something like what Switzerland gets (all the benefits, but none of the restrictions).

But even if you get completely shut out: so what? Look at the fastest growing economies in the world. Look at the cities with the most innovation, or the countries with the fastest growth or largest economies. What do they all have in common? They are not part of the EU. As it turns out, no one in history has ever needed France's help to innovate, grow economically, and create jobs.

Tomorrow, please make the UK the haven for innovation and economic growth that it can be. Please vote to leave.

Respectfully,

Arvin Vohra
Vice Chair, Libertarian National Committee
Entrepreneur, Founder of Vohra Method