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So where now for the UK?

As the UK faces up to the prospect of the first hung parliament since 1974 after yesterday's election, Reinsurance Towers has been getting rather confused.

On the surface, surely a hung parliament is a good thing - doesn't that mean that a broader spectrum of voters will have their views represented in a coalition government?

Sadly nothing is ever quite so simple as it seems, with the reality being closer to a nightmare. With so much uncertainty surrounding the results and a whole host of unanswered questions no-one seems to know what will happen next with the potential that Westminster could become paralysed as a result.

As it stands the UK is about to enter a confusing period of political, social and cultural uncertainty.

A hung parliament is the worst possible result for the City with the consequences of the election remaining unclear for the near future. David Cameron may be throwing his weight around as the Conservatives are now the largest party but he has failed to win that all important majority and Gordon Brown has dug himself in with talks of a potential coalition deal with the Liberal Democrats.

And do I really need to say anything about Reinsurance Towers' opinions of George Osborne and how well he would perform as Chancellor? I'll leave that to your imagination...

The timing for the financial sector hasn't really helped matters with global markets taking a battering overnight as the Dow Jones suffered its biggest ever intraday point drop - 998.5 points - as a suspected trading glitch and fears of a new credit crunch in Europe threw markets into disarray.

The pound also slumped this morning on the news of the hung parliament outcome indicating what many feared would result from the uncertainty. If no agreement is reached between the parties we could even see a second early election.

With hundreds of voters having been turned away from polling stations, due to long queues and a shortage of voting slips, there's the risk that we will see some legal challenges turning the election into frankly a bit of a joke but best not to get me started on the need for the reform of the UK political system.

So what next for the UK and its financial sector? With so many questions still left to answer, who knows?


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