Obama slaps Remain, says Brexit will be orderly
Humiliated, cynical, rump Remain has a certain power to spook confidence. But only for a short while. It's amazing how little of their scaremongering has come true. Obama says, in a slap in the face to Remain, Brexit will be an "orderly transition". And so it will
Speaking in Warsaw today at the NATO summit, President Obama said what everyone in the establishment knows but, mostly, won't yet admit.
"Everybody has an interest in minimising any disruptions as the UK and the EU forge a new relationship," he said. There will be an, "orderly transition".
Of course there will, and it was always going to be so. All that needs to happen -- and it will happen soon enough -- is for everyone to see through the continued scaremongering of the Remain camp.
It is a sad statement about their pettiness of mind, but the establishment -- and this includes the Bank of England, the Treasury, the leading financial media such as The Financial Times etc -- feels so humiliated that it is desperately trying to make economic instability a self-fulfilling prophesy.
They have a certain power to do that, which is why consumer confidence and the value of the pound were bound to suffer a temporary decline.
But it won't last. Markets and the public will soon revert to focusing on the fundamentals.
Indeed, it is amazing how little disruption there has been. The FTSE100 has massively outperformed the DAX and the CAC 40. The wider FTSE250 has performed at more or less the same rate as those two leading Eurozone indices. This is exactly the opposite of what Project Fear predicted.
As for the currency markets -- easily spooked at the best of times -- it's true that the pound has fallen sharply against the dollar. But (quite apart from the obvious boost to exporters) this is mainly a flight to safety. The euro is down against the dollar too.
As for the pound versus the euro, yes it has lost value. But only to levels seen 3 years ago, long before anyone was even talking about a potential Brexit.
And that's really the point. There is a vast array of variables at play in determining a country's economic success. Ultimately, our membership of the EU and the single market is just one of them.
If a post-EU Britain manages its economy recklessly, we'll do badly. If we manage our economy prudently, we'll do fine.
In relative terms, the smart money would favour optimism. Theresa May looks like a safe pair of hands. British fundamentals are strong.
And in relative terms, the real concerns in Europe lie with the Eurozone, as we can see with the increasing nervousness about the Italian banking sector.
So, be prepared for more trouble making and negative spin from rump Remain. But you'll be amazed how quickly everything gets back to normal.
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