Markets
Is Brexit the First of Many Dominoes? [Chart]
![Is Brexit the First of Many Dominoes? [Chart]](https://www.visualcapitalist.com/wp-content/uploads/2016/06/brexit.jpg)
Is Brexit the First of Many Dominoes? [Chart]
UK and the Rest of Europe Brace for an Uncertain Future
The Chart of the Week is a weekly Visual Capitalist feature on Fridays.
Markets have been turned upside down by a surprise Brexit result and the resignation of David Cameron. While there is looming uncertainty around how this will affect the United Kingdom and Europe from an economic perspective, it might be just the tip of the iceberg in terms of long-run consequences.
A Brexit opens the door for future events that would be previously unfathomable by popular opinion, and it gives vital ammunition to groups that are seeking their own referendums for independence.
Unwilling Passengers?
As the UK ship distances itself from European docks, there are two passengers that may have been more comfortable remaining on shore.
While England and Wales voted to “Leave” with 53.4% and 52.5% respectively, Scotland and Northern Ireland were both firmly in “Remain” territory. Scotland, which previously held its own independence referendum in 2014, voted overwhelmingly to have the UK remain in the EU with a 62% vote. Northern Ireland had a similar sentiment with 55.8% voting “Remain”.
Scotland’s First Minister, Nicola Sturgeon, said today that a second independence referendum for Scotland is “highly likely”. She feels Scotland was taken out of the EU against its own will, and that Scottish independence is worth revisiting.
Meanwhile, Northern Ireland has echoed these calls, instead potentially looking at voting on a united Ireland. Northern Ireland is the only country in the UK that shares a land border with a country in the EU.
Other Dominoes
The Brexit result has energized other populist movements across the European Union. Anti-immigration leaders such as Geert Wilders and Marine Le Pen have ratcheted up cries for their own independence votes:
Hurrah for the British! Now it is our turn. Time for a Dutch referendum! #ByeByeEUhttps://t.co/kXZ0aQtgmx
— Geert Wilders (@geertwilderspvv) June 24, 2016
Victoire de la liberté ! Comme je le demande depuis des années, il faut maintenant le même référendum en France et dans les pays de l'UE MLP
— Marine Le Pen (@MLP_officiel) June 24, 2016
However, it is not just people on the fringe that are interested in revisiting EU membership. Even before the Brexit result, a poll by Ipsos Mori showed that the majority of people in France in Italy want to at least have a referendum on leaving:
Who else wants out? #uhoh pic.twitter.com/UwDESY3wQx
— ian bremmer (@ianbremmer) June 24, 2016
Meanwhile, over 40% of Swedes, Poles, and Belgians are in the same boat.
Now that Brexit is a thing, will these numbers trend higher? What will be the next domino to fall?
Markets
The Top Google Searches Related to Investing in 2022
What was on investors’ minds in 2022? Discover the top Google searches and how the dominant trends played out in portfolios.
The Top Google Searches Related to Investing in 2022
It was a turbulent year for the markets in 2022, with geopolitical conflict, rising prices, and the labor market playing key roles. Which stories captured investors’ attention the most?
This infographic from New York Life Investments outlines the top Google searches related to investing in 2022, and offers a closer look at some of the trends.
Top Google Searches: Year in Review
We picked some of the top economic and investing stories that saw peak search interest in the U.S. each month, according to Google Trends.
| Month of Peak Interest | Search Term |
|---|---|
| January | Great Resignation |
| February | Russian Stock Market |
| March | Oil Price |
| April | Housing Bubble |
| May | Value Investing |
| June | Bitcoin |
| July | Recession |
| August | Inflation |
| September | US Dollar |
| October | OPEC |
| November | Layoffs |
| December | Interest Rate Forecast |
Data based on exact searches in the U.S. from December 26, 2021 to December 18, 2022.
Let’s look at each quarter in more detail, to see how these top Google searches were related to activity in the economy and investors’ portfolios.
Q1 2022
The start of the year was marked by U.S. workers quitting their jobs in record numbers, and the effects of the Russia-Ukraine war. For instance, the price of crude oil skyrocketed after the war caused supply uncertainties. Early March’s peak of $125 per barrel was a 13-year high.
| Date | Closing Price of WTI Crude Oil (USD/Barrel) |
|---|---|
| January 2, 2022 | $76 |
| March 3, 2022 | $125 |
| December 29, 2022 | $80 |
While crude oil lost nearly all its gains by year-end, the energy sector in general performed well. In fact, the S&P 500 Energy Index gained 57% over the year compared to the S&P 500’s 19% loss.
Q2 2022
The second quarter of 2022 saw abnormal house price growth, renewed interest in value investing, and a bitcoin crash. In particular, value investing performed much better than growth investing over the course of the year.
| Index | Price Return in 2022 |
|---|---|
| S&P 500 Value Index | -7.4% |
| S&P 500 Growth Index | -30.1% |
Value stocks have typically outperformed during periods of rising rates, and 2022 was no exception.
Q3 2022
The third quarter was defined by worries about a recession and inflation, along with interest in the rising U.S. dollar. In fact, the U.S. dollar gained against nearly every major currency.
| Currency | USD Appreciation Against Currency (Dec 31 2020-Sep 30 2022) |
|---|---|
| Japanese Yen | 40.1% |
| Chinese Yuan | 9.2% |
| Euro | 25.1% |
| Canadian Dollar | 7.2% |
| British Pound | 22.0% |
| Australian Dollar | 18.1% |
Higher interest rates made the U.S. dollar more attractive to investors, since it meant they would get a higher return on their fixed income investments.
Q4 2022
The end of the year was dominated by OPEC cutting oil production, high layoffs in the tech sector, and curiosity about the future of interest rates. The Federal Reserve’s December 2022 economic projections offer clues about the trajectory of the policy rate.
| 2023 | 2024 | 2025 | Longer Run | |
|---|---|---|---|---|
| Minimum Projection | 4.9% | 3.1% | 2.4% | 2.3% |
| Median Projection | 5.1% | 4.1% | 3.1% | 2.5% |
| Maximum Projection | 5.6% | 5.6% | 5.6% | 3.3% |
The Federal Reserve expects interest rates to peak in 2023, with rates to remain elevated above pre-pandemic levels for the foreseeable future.
The Top Google Searches to Come
After a year of volatility across asset classes, economic uncertainty remains. Which themes will become investors’ top Google searches in 2023?
Find out how New York Life Investments can help you make sense of market trends.
-
Automotive17 hours agoThe Most Fuel Efficient Cars From 1975 to Today
This infographic lists the most fuel efficient cars over the past 46 years, including the current leader for 2023.
-
Technology3 days agoRanked: The Top 50 Most Visited Websites in the World
In this visualization, we rank the top 50 websites that receive the most internet traffic, from Google to CNN.
-
Markets4 days agoCharted: The Dipping Cost of Shipping
After a dramatic spike during the pandemic, shipping costs have now fallen back to Earth. What does that mean for shippers and the economy?
-
VC+7 days agoAccess Our Exclusive Report and Upcoming ‘2023 Global Forecast’ Webinar on VC+
See what the beginning of 2023 may hold, starting with our Global Forecast Report which summarizes hundreds of expert predictions.
-
Energy1 week agoVisualizing China’s Dominance in Battery Manufacturing (2022-2027P)
This infographic breaks down battery manufacturing capacity by country in 2022 and 2027.
-
Politics1 week agoWhich Countries are the Most Polarized?
This chart plots polarization for various countries based on the Edelman Trust Institute’s annual survey of 32,000+ people.
-
Markets2 weeks agoThe Biggest Global Risks of 2023
-
Markets4 weeks agoTop Heavy: Countries by Share of the Global Economy
-
Politics1 week agoVisualizing the World’s Top 25 Fleets of Combat Tanks
-
Money4 weeks agoU.S. Inflation: How Much Have Prices Increased?
-
Energy1 week agoThe Periodic Table of Commodity Returns (2013-2022)
-
Misc4 weeks agoInfographic: The Longest Lasting Cars, in Miles
-
Politics1 week ago
Which Countries are the Most Polarized?
-
Markets3 weeks agoThe U.S. Stock Market: Best and Worst Performing Sectors in 2022