1. Exquisite Tweets from @ChrisGiles_

    PreoccupationsCollected by Preoccupations

    Today, @NIESRorg put out the first of many economic assessments on the Brexit withdrawal agreement and political declaration.

    ft.com/content/a60a94…

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    ChrisGiles_

    Chris Giles

    It’s vague in places because the deal is vague. The big assumptions

    1. There would be a minor bounce if U.K. stayed in durably
    2. Canada style deal (if NI sorted) costs £1,100 a year per person by about 2030 (see pic)
    3. Backstop costs £700 because customs union an advantage

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    ChrisGiles_

    Chris Giles

    As per pic. The big assumption @NIESRorg make is that Brexit harms services productivity. This is reasonable but the least well evidences part of the research.

    Some will also question the scale of the trade losses (up to 46%). That is less important though in generating losses

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    ChrisGiles_

    Chris Giles

    And we should remember that these are conditional forecasts. They are relative to a baseline (which will be wrong).

    Baseline in pic below

    That makes them more precise.

    It’s like doctors saying “drugs are bad”, rather than saying “that smack will shorten your life by 6 mins”

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    ChrisGiles_

    Chris Giles

    The upshot is that Theresa May’s deal will make us poorer

    Scale?

    About a third of financial crisis

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    ChrisGiles_

    Chris Giles

    They have made 2 assumptions.

    1. The backstop. (Quite easy to model)
    2. Assuming NI fixed, a Canada style agreement that Brexiters want.

    There are other possibilities.

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    ChrisGiles_

    Chris Giles