Much as I predicted, less than a week after the referendum the financial markets are already recovering the modest losses resulting from the initial political uncertainty:
Pressure has eased on UK financial markets after two days of turmoil in the wake of the Brexit vote, with the FTSE 100 share index closing higher.
In a month or so it will be business as usual, with both the UK and the EU countries repositioning themselves to face the new economic reality. But how different will it really be? The UK products which are competitive will still find buyers on the continent and elsewhere and the ones which only survived on EU subsidies will disappear. Good riddance! As long as all players allow the market forces to take the lead the whole Brexit affair will turn out to be an economic non-event. If (or rather: when) that happens will the “experts” prophesising economic melt-down and recession in the UK:
Leaving the European Union would tip the UK into a year-long recession, with up to 820,000 jobs lost within two years, Chancellor George Osborne says. Publishing Treasury analysis he said a Leave vote would cause an “immediate and profound” economic shock, with growth between 3% and 6% lower.
lose their cushy jobs? Time will tell but I suspect they will just move on to comment on the economic impact of global warming by 2100, the costs of “inequality” and “gender gap” or some other imponderable nonsense.
So we know that the UK will be leaving the EU but will the Euro-apparatchiks take this blow to their beloved Marxist creation on the chin and just quietly move on? It does not appear so:
A central figure in the Leave campaign, UK Independence Party (UKIP) leader Nigel Farage, was booed, called a liar and accused of using “Nazi propaganda”.
The EU-philes are now resorting to personal attacks against those who channelled and facilitated the collective will of the Brits. It is ironic that the worshippers of democracy gathered in the European Parliament scoff at the democratic decision made by the citizens of one of its member states. So is democracy only good when it promotes Marxist collectivism? In any case the UK PM David Cameron is keen to make the transition smooth and painless:
“I’ll be explaining that Britain will be leaving the European Union but I want that process to be as constructive as possible,” he told reporters before the summit’s working dinner in Brussels.
This presumably means initiating informal negotiations, in preparation for the official withdrawal from the EU. But Angela Merkel will have none of that:
The German Chancellor, Angela Merkel, has said there can be no talks on Brexit before the UK formally begins the process of leaving the EU.
Her confrontational stance is aimed at discouraging other states from leaving the EU by making the transition costly for the UK. This belligerent tactic is very short-sighted and will backfire against Ms Merkel who is now styling herself as a head bully of the EU.
The way the Brexit drama plays out will provide us with both entertainment and reflection for months to come.