Brexit

If a person wanted to use the title of a Shakespeare play to describe the Brexit vote, they would undoubtedly choose The Tempest. I think Much Ado About Nothing is a more accurate choice.

This is a reflection of the same phenomena that has brought Donald Trump and Bernie Sanders into the political limelight. Originally the idea was to form a common market but the vision evolved into a political union as well. Many resented being told what to do by a government in Brussels. When the current government fiercely fought against an exit, it became a battle against the Establishment. President Obama made matters worse when he treated the people like a small child threatened with punishment if they didn’t behave.
There will be a lot of changes as British regulations replace those of the EU. The big concern is over trade. There is a two year period to negotiate new trade rules. Britain is the world’s fifth largest economy. Roughly half its imports are from the EU. In many respects it is the financial leader of Europe. While there are some bruised egos, a trade war is in nobody’s interest. Eventually I expect to see cooler heads prevail.

The US stock market had a huge drop yesterday. Even companies that have no exports felt the loss. This is a real overreaction. Exports to Britain account for only 0.3% of our GDP. That is basically a rounding error. Despite Obama’s idiotic talk about punishing them, we will work out an agreement that is favorable to both countries.

This country has a number of serious challenges but this isn’t one of them.