Why Leaving Europe Could Be A Disaster For Investors

This is about more than grumbling over Brussels bureaucracy.

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

Progress. From month to month, and year to year, things just get better. We find better ways of making things, doing things, fixing things. This means our lives, and the quality of our lives, just keeps getting better. That’s how it’s supposed to be anyway.

If you were to see a television made in the 1950s, and compare it with a television of today, there’s just no comparison. A 12-inch, noisy, black and white wooden box bears no comparison with a 46 inch flat screen, high definition LCD.

A good thing?

Is progress a good thing? Well of course it is. There’s no argument.

The European Union also had its roots in the 1950s. It started out as a declaration by the French foreign minister of the time, Robert Schuman. This was soon followed by the Treaty of Paris, and the launch of the European Coal and Steel Community. This eventually became the European Economic Community.

Since then we’ve had the Maastricht Treaty, which led to the formation of the European Union. This is a Union that brought us the single currency and the free movement of goods, services and labour.

Extensive funding is provided for groups ranging from scientists and businessmen to farmers. There are extensive rules and regulations to preserve our environment, and there are a range of laws on human rights.

Mobility means that we don’t need visas, that it’s far easier to travel in Europe, and that we can settle in the south of France and on the Spanish coast.

A huge number of British companies trade in Europe. They often trade in euros, their employees travel from Manchester to Paris and Warsaw, and their shares may be listed on the London and Frankfurt stock exchanges.

Leaving Europe would be a backward step

People grumble about Europe all the time. They talk about too much immigration, and excessive regulation. Why, they ask, is Brussels interfering all the time? Leaving Europe may have its attractions, but it would be a disaster for British companies and British investors.

The FTSE 100 would fall, and so would the pound. Some companies would up sticks and leave Britain, and others might decide to locate their next factory, office or lab in Valencia rather than Birmingham. Jobs would be lost. But there’s something more important than that. Because this would change how the world views Britain. It would be seen in a very negative light.

That’s why I view leaving the European Union so seriously. You’re not leaving the Greek crisis, and you’re not leaving what people hand-wavingly call ‘Brussels bureaucracy’. In one fell swoop, you’re leaving over sixty years of European progress.

It would be a backward step. Don’t take it.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

More on Investing Articles

Investing Articles

1 penny stock with the potential to change the way the world works forever!

Sumayya Mansoor breaks down this potentially exciting penny stock and explains how it could impact food consumption.

Read more »

Investing Articles

2 FTSE 250 stocks to consider buying for powerful passive income

Our writer explains why investors should be looking at these two FTSE 250 picks for juicy dividends and growth.

Read more »

Investor looking at stock graph on a tablet with their finger hovering over the Buy button
Growth Shares

This forgotten FTSE 100 stock is up 25% in a year

Jon Smith outlines one FTSE 100 stock that doubled in value back in 2020 but that has since fallen out…

Read more »

Middle-aged white man pulling an aggrieved face while looking at a screen
Investing Articles

2 dividend shares I wouldn’t touch with a bargepole in today’s stock market

The stock market is full of fantastic dividend shares that can deliver rising passive income over time. But I don't…

Read more »

Frustrated young white male looking disconsolate while sat on his sofa holding a beer
Investing Articles

Use £20K to earn a £2K annual second income within 2 years? Here’s how!

Christopher Ruane outlines how he'd target a second income of several thousand pounds annually by investing in a Stocks and…

Read more »

The flag of the United States of America flying in front of the Capitol building
Investing Articles

Here’s what a FTSE 100 exit could mean for the Shell share price

As the oil major suggests quitting London for New York, Charlie Carman considers what impact such a move could have…

Read more »

Two white male workmen working on site at an oil rig
Investing Articles

Shell hints at UK exit: will the BP share price take a hit?

I’m checking the pulse of the BP share price after UK markets reeled recently at the mere thought of FTSE…

Read more »

Investing Articles

Why I’m confident Tesco shares can provide a reliable income for investors

This FTSE 100 stalwart generated £2bn of surplus cash last year. Roland Head thinks Tesco shares look like a solid…

Read more »