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Financial planners urge calm after Brexit vote

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Posted at 6:07 PM, Jun 24, 2016
and last updated 2016-06-24 18:07:03-04

Will the Brexit vote result cost Americans money?

Yes and no, according to financial experts.

“Over the next month, you can probably expect to see a lot of volatility in your stock portfolio,” Towson University Chief Economist Daraius Irani said. “This would probably not be time to sell, because you’d take a beating. It may even be a time to buy because markets are going down.”

Eric Brotman of the Brotman Financial Group said a long term impact on U.S. investments is unlikely.

“This is not bigger than Greece, in my opinion. This is not Lehman Brothers falling apart,” he says. “This is not the banking or credit crisis. This is a significant sea change politically.”

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According to both men, Americans will likely be spared from years of economic fallout because it is rare for a political decision to cause long term market turmoil overseas. Irani says U.S. markets are only dropping today, because the Brexit vote was so unexpected.

“The event was basically predicted to remain,” he said. “It didn’t remain. ‘Boom,’ all of the sudden people were like, ‘I got to get out of this market.’”

Americans may actually benefit financially as interest rates are now expected to stay low for a longer period of time. Also, the U.S. dollar is gaining in value compared to European currency.

Brotman said while some may take a portfolio hit in the short term, American investors should not react drastically to Brexit updates being spread on social media.

“There’s been a lot of false information about layoffs and about bank issues,” he said. “The banks that will be hurt are in Europe. It will have an impact on global banking. It’s unlikely to do anything like what we saw eight years ago.”

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