In the play Waiting for Godot, the two main characters sit by the side of the road talking about what they are going to do when this third character (Godot) arrives. He never does, so the pair continue to talk about it, presumably forever, with nothing ever changing.
For those of us watching the debate in Westminster over the last few months, it sounds rather familiar.
Politicians are shouting at each other, quitting parties, forming others, voting for some things and not for other things, but all the while nothing happens… and Brexit never seems to arrive.
The latest attempt could have seen the arrival of Brexit – our own particular Godot – pushed out further than the end of March.
But equally, it might not have?
One thing investors need to keep in mind is that uncertainty is something financial markets really do not like.
The companies whose stocks are traded daily cannot plan, which means equity investors get nervous; global currency traders get the jitters if they don’t see a clear path ahead for a country’s government; and debt markets usually take a pessimistic view, thinking there is more likelihood of loans not being repaid if the future is shrouded in mystery.
If there is one thing the UK has led the world in lately, it is uncertainty. But, despite all this, and the historic scenes within the House of Commons, financial markets have given one big shrug.
The FTSE 100 has barely budged and after a week of defeats for the government, opposition and pretty much everyone else, it closed almost 18% up on where it had ended the day after the EU referendum.
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Why? Surely this agonising will-they-won’t-they is the worst kind of uncertainty.
Turns out, it isn’t.
The term that traders and investors use is: “priced in”. Much of the impact of the Brexit vote caused in 2016 has been dealt with by the market. Most people have moved on.
While the government is waiting for some kind of resolution to the deal, no-deal or no-Brexit shenanigans, life is trundling along as usual.
With so many personalities and vested interests at play, it is impossible to foresee which amendments will pass and which won’t. The added complication of the EU having to agree to a delay does not seem to have worried markets either.
So, while journalists find new ways of trying to explain what is going on and politicians flip-flop between allegiances, investors need to keep calm and carry on – Brexit might take longer to arrive than we thought.
Learn more about Brexit and find popular markets here.
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