Scottish referendum results: Global investors, businesses and the City have their victory as Scotland says 'No'


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After the shrillest campaign of fear from the financial and corporate community since the banks' great lobbying against reforms after they caused the financial crisis, the Scottish people decided to vote "no". They have decided, as City traders would say, to adopt a "risk off" strategy.

The reaction of investors has been predictably jubilant this morning - a rallying pound and shares expected to push to new record highs.

Investors and business people hate uncertainty more than almost any other event. They have to deploy, in some cases, billions of pounds into long term strategies. Their whole raison d'etre is to keep the risks of those investments being damaged by shifting tax regimes, moving currencies, gyrating economies, to an absolute minimum.

There was no doubt that a Yes vote would have resulted in months of uncertainty - right up to, and beyond, the implementation of the split (set absurdly optimistically at 18 months hence).

But what would have happened thereafter? Despite the volume of noise to the contrary, possibly not the armageddon that the majority of the business lobby had predicted.


Far from being a certain disaster, it always seemed far more likely that Westminster and Scotland could have negotiated an effective compromise to the many issues raised: primarily the currency and reach of the Bank of England.

It has also seemed fairly clear that the Scottish economy, and its tax and spend plans, were unlikely to diverge massively from that of the rest of the UK, and therefore a shared currency could probably have been made to work. Having said that, it would have taken a lot of effort, and there are risks attached. Meanwhile, the claim that the movement of ideas and people would have been blocked off as if a giant wall was about to be erected on the border, Palestine-style, also seemed dubious, as anyone who has spent any time in and around the spongey European border regions can testify. There, millions of people a day commute between Belgium, France, Switzerland, Italy and Germany every day.

More compelling, perhaps, was the argument that a bigger country is more likely to be able to negotiate better than two smaller ones and attract more overseas investors to its shores.

For now, though - until the Scottish blood rises again in a decade or so - all these arguments can be put to bed. Just like the knackered looking TV pundits and politicians.

Investors can get back to their work of driving share prices to absurd new record highs, ignoring the fact that western economies are only being kept alive by the finite policies of their central banks. And that's before you start thinking about the possibility of Britain's exit from the EU. Never mind a Scottish secession, there are plenty of more real risks elsewhere.