As the US endures its divisive Presidential election, British companies are navigating the impact of its contentious referendum - and some of Brexit's biggest corporate supporters look to be changing their tune.
Hedge fund manager Crispin Odey - perhaps the single largest financial victor from the June 23 vote - has warned that Britain will likely fall into recession while Wetherspoon's (JDWPY) Chairman Tim Martin, another vocal Leave supporter, has warned the pub chain's supplier deals have become harder to negotiate due to uncertainty over tariff-free trade with Europe.
Both Odey and Martin were staunch supporters of the campaign to leave the European Union and argued that an independent Britain would be better for business.
However, in a letter Odey Asset Management clients that was revealed late Tuesday, Odey himself wrote that U.K. markets could fall as much as 80% as a result of the Brexit vote.
Britain's blue chip benchmark FTSE 100 index hit a record high in October and was still hovering within reach of the 7,000 mark amid a wider selloff.
"These times are getting interesting. The FTSE 100 share index is now up 30% over five years, whilst earnings have fallen 80%," he wrote. According to Thomson Reuters data, London's benchmark index is currently trading at 15.8 times forward earnings.
To get it 13 times earnings - close to the index's long-term average - stocks need to decline by 80% and profits can't fall any further than they have, Odey argued.
"What the U.K. is promising is rising wages, recession, inflation and falling profits. Not exactly the prize that ticket holders in the FTSE and the gilt market have paid up for," he wrote.
He predicted that inflation could rise up to 3.5% as the pound continues to fall. The British currency has lost almost 20% since the Brexit vote. He urged Bank of England Governor Mark Carney to raise interest rates, rather than lower them.
Odey made more than £220 million ($270.54 million) for himself and investors in the aftermath of the vote from his short positions on stocks and the pound.
According to Bloomberg, as of Wednesday morning Odey had short positions work $929 million in 18 British companies, including Tullow Oil (TUWOY) and Sainsbury's (JSAIY) , the country's second-largest grocer. The list of companies derive most of their profits in Britain.
It is also short financial services provider Hargreaves Lansdowne, whose co-founder Peter Hargreaves was also pro-Brexit.
In the run up to the vote Odey, along with more than 100 executives from the U.K.'s financial services industry, signed a letter backing Brexit. The group said leaving the EU would help strengthen London's position as a financial capital.
As of the end of September Odey Asset Management had $8.8 billion under management across its strategies.
Wetherspoon's Martin said Wednesday that British companies were being "bullied" by the EU and threatened to stop using European brands.
EU officials have been tough in their stance that the U.K. would not have access to the single market if free movement of people is prohibited. The British government looks to be favoring a "hard Brexit" that restricts immigration.
"According to press reports, Juncker told European business leaders, in October, not to negotiate with UK companies and to adopt an 'intransigent' attitude," Martin said in a trading statement. "This suggested approach puts an unfair burden on the excellent European suppliers with which UK companies, like Wetherspoon, have traded for many decades."
He suggested that this is having an impact on deals with European suppliers. "If we, and companies like ours, are unable to agree on tariff-free transactions, it will inevitably result in a loss of business for European companies which have done nothing to deserve this outcome," Martin said.
He added that the "ultimate sanction" was in the hands of consumers, saying French wine, champagne and spirits, German beer and Swedish cider were at "extreme risk."
The company has more than 900 pubs in the U.K and is listed on the FTSE 250.
Before the referendum Martin said he expected the cost of doing business to decrease after Brexit, saying tariffs and food prices would likely decrease.
"It is much harder to do business under the European Union as [the U.K.] does not control our own law and regulation," he told the TheStreet in an exclusive interview just prior to the Brexit vote.