Best of the Week
Most Popular
1. 2019 From A Fourth Turning Perspective - James_Quinn
2.Beware the Young Stocks Bear Market! - Zeal_LLC
3.Safe Havens are Surging. What this Means for Stocks 2019 - Troy_Bombardia
4.Most Popular Financial Markets Analysis of 2018 - Trump and BrExit Chaos Dominate - Nadeem_Walayat
5.January 2019 Financial Markets Analysis and Forecasts - Nadeem_Walayat
6.Silver Price Trend Analysis 2019 - Nadeem_Walayat
7.Why 90% of Traders Lose - Nadeem_Walayat
8.What to do With Your Money in a Stocks Bear Market - Stephen_McBride
9.Stock Market What to Expect in the First 3~5 Months of 2019 - Chris_Vermeulen
10.China, Global Economy has Tipped over: The Surging Dollar and the Rallying Yen - FXCOT
Last 7 days
After 8 Terrific Weeks for Stocks, What’s Next? - 16th Feb 19
My Favorite Real Estate Strategies: Rent to Live, Buy to Rent - 16th Feb 19
Schumer & Sanders Want One Thing: Your Money - 16th Feb 19
What Could Happen When the Stock Markets Correct Next - 16th Feb 19
Bitcoin Your Best Opportunity Outside of Stocks - 16th Feb 19
Olympus TG-5 Tough Camera Under SEA Water Test - 16th Feb 19
"Mi Amigo" Sheffield Bomber Crash Memorial Site Fly-past on 22nd February 2019 VR360 - 16th Feb 19
Plunging Inventories have Zinc Bulls Ready to Run - 15th Feb 19
Gold Stocks Mega Mergers Are Bad for Shareholders - 15th Feb 19
Retail Sales Crash! It’s 2008 All Over Again for Stock Market and Economy! - 15th Feb 19
Is Gold Market 2019 Like 2016? - 15th Feb 19
Virgin Media's Increasingly Unreliable Broadband Service - 15th Feb 19
2019 Starting to Shine But is it a Long Con for Stock Investors? - 15th Feb 19
Gold is on the Verge of a Bull-run and Here's Why - 15th Feb 19
Will Stock Market 2019 be like 1999? - 14th Feb 19
3 Charts That Scream “Don’t Buy Stocks” - 14th Feb 19
Capitalism Isn’t Bad, It’s Just Broken - 14th Feb 19
How To Find High-Yield Dividend Stocks That Are Safe - 14th Feb 19
Strategy Session - How This Stocks Bear Market Fits in With Markets of the Past - 14th Feb 19
Marijuana Stocks Ready for Another Massive Rally? - 14th Feb 19
Wage Day Advance And Why There is No Shame About It - 14th Feb 19
Will 2019 be the Year of the Big Breakout for Gold? - 13th Feb 19
Earth Overshoot Day Illustrates We are the Lemmings - 13th Feb 19
A Stock Market Rally With No Pullbacks. What’s Next for Stocks - 13th Feb 19
Where Is Gold’s Rally in Response to USD Weakness? - 13th Feb 19
US Tech Stock Sector Setting Up for A Momentum Breakout Move - 12th Feb 19
Key Support Levels for Gold Miners & Gold Juniors - 12th Feb 19
Socialist “Green New Deal” Points the Way to Hyperinflation - 12th Feb 19
Trump’s Quest to Undermine Multilateral Development Banks - 12th Feb 19
Sheffield B17 US Bomber Crash 75th Anniversary Fly-past on 22nd February 2019 Full Details - 12th Feb 19
The 2 Rules For Successful Trading - 12th Feb 19 -
Financial Sector Calls Gold ‘Shiny Poo.’ Are They Worried? - 11th Feb 19
Stocks Bouncing, but Will They Resume the Uptrend? - 11th Feb 19
EURO Crisis Set to Intensify: US Dollar Breakout Higher
Stock Market Correction Starting? - 10th Feb 19
Gold Stocks Gather Steam - 10th Feb 19
Are Gold Bulls Naively Optimistic? - 9th Feb 19
Gold, Silver Precious Metals Update - 9th Feb 19
The Wealthy Should Prepare to Be Soaked - 8th Feb 19
US Business Confidence Is Starting to Crack - 8th Feb 19
Top Myths and Facts about ULIP Plans - 8th Feb 19
A Major Stocks Bear Market in 2020? - 8th Feb 19
Gold Market Extremes Test Your Mettle - 8th Feb 19
The Venezuela Myth Keeping Us From Transforming Our Economy - 8th Feb 19

Market Oracle FREE Newsletter

The Real Secret for Successful Trading

BrExit Threat - London Bridge is (Broken) Down

Politics / BrExit May 08, 2017 - 04:15 AM GMT

By: Raul_I_Meijer

Politics

The French election, won just now by Emmanuel Macron, put several segments of the French population opposite one another in a pretty fierce contest. And that contest will continue. Because Macron won’t be able to lift the French economy out of its doldrums any more than Le Pen could have, or than Trump can life the US, and the new president will have the honor of presiding over a further and deepening downturn. The French political dividing line was aptly described by Simon Kuper recently:


The ultra-nationalist writer Charles Maurras believed there were “two Frances”. The one he loved was the “pays réel”, the real country: a rural France of church clocks, traditions and native people fused with their ancestral soil. Maurras loathed the “pays légal”, the legal country: the secular republic, which he thought was run by functionaries conspiring for alien interests.

Maurras was born in 1868 and died in 1952. But if he returned on Sunday to witness the French presidential run-off, he would instantly recognise both candidates. He would cast Emmanuel Macron as the incarnation of the “legal France” and Marine Le Pen as embodying the “real” one.

Maurras may have been a questionable character, but that description is not half bad. Once enough people in the country understand the failure of ‘legal’ France, they will want ‘real’ France back. That will be true in countries all over Europe; to a large extent it already is. Marine Le Pen summed up the key issue really well a few days ago when she said of the country post election: “France will be led by a woman, me or Mrs. Merkel.”

There is only one reason the French people would ever tolerate Germany having an outsized influence in their politics and economics: that they feel they benefit from it financially. And yes, if you put it that way, it’s already quite something that they haven’t revolted more and earlier.

The generous unemployment benefits are undoubtedly part of that. But those can’t last. And since the Germans owe their influence in Paris to the EU, it’s obvious how the French will feel they can stop that influence. And then the EU will turn out to be not a peacemaker, but the opposite.

Still, as much as France is divided, and as serious as that division is, the country is a shining beacon of unity compared to the UK, where the dividing lines are as manifold as they are laced with toxins. The snap election PM Theresa May called, in just over a month, can do nothing to resolve any of it. That means the EU can do what they want in the Brexit negotiations. Which will therefore be an unparalleled disaster for May and the UK.

The EU can and will ‘have its way’ with the UK for one simple reason: the United Kingdom is anything but United. It makes no difference what the EU does to the UK, the British won’t blame them for it. They will blame each other instead. No matter what happens these days, the British always know in advance who’s to blame, and it’s never themselves; it’s always another group of Brits.

The Tories are deeply divided between pro- and anti-Brexit forces. Labour is divided along those same lines, and adds pro- and anti-Corbyn sentiments for good measure. Other parties don’t really matter much, but they have similar dividing lines as well.

Anti-Corbyn Labour MPs have convinced themselves they know better than pro-Corbyn party members. They’ve kept claiming for so long that Corbyn is unelectable it’s become a self-fulfilling prophecy. They’ll be lucky not to face the fate of their former brethren in François Hollande’s Parti Socialiste, who ended up with just 6% of the vote in the 1st round of the French elections.

PM Theresa May called the snap election for June 8 to hide some of the divisions behind, to make them appear less relevant, or even to profit from them and grab more power. But the very fact that Brexit was voted in, already makes the election nigh irrelevant.

Whoever wins, and it looks certain to be May herself. will open themselves to being scapegoated in a big way. Which won’t keep them from seeking victory, because the loser can expect the same fate. The trenches have been dug, and deeply. Governable? Don’t count on it. It feels more like 40 years later we’re back to Johnny Rotten ‘singing’ Anarchy in the UK.

If May threatens to leave the EU ‘cold’ and trigger a ‘Hard Brexit’, she will simultaneously trigger a whole lot more, and much wider, divisions in the country (or is that countries?!), and that’s even without mentioning an entire minefield of legal, and potentially constitutional, issues. The latter especially because Britain doesn’t have an actual -written- constitution.

For Brussels, it’s easy pickings, and pick they will. This week, they casually raised the UK’s cost of leaving the EU to €100 billion, from estimates varying from €40 billion to €60 billion before. Paddy Power and its equally powerful bookie ilk soon won’t be taking any bets below, say, €150 billion. In that regard, and many others, the EU will do to the UK what it is doing to Greece.

The only way to stand up against that is to show a common front. But there will be no such thing in the Divided Kingdom, not for a long time. Everyone has their favorite scapegoat, for some it’s Nigel Farage, for others David Cameron, George Osborne, Tony Blair, Jeremy Corbyn or Theresa May. And nobody is going to leave their blame trenches. They’re the only places they feel somewhat comfortable, less scared, in.

Theresa May, if the polls are to be believed -and given the divisions we might for once-, will have to sit down and negotiate with the multi-headed Hydra that is the EU, ‘strengthened’ by a major election victory, but she will find it the ultimate Pyrrhic victory, because Brussels will have a ball playing her divided ‘nation’.

Scotland can probably easily be seduced with the carrot of EU membership, but more importantly, Juncker and his people can cast doubt on the entire Brexit vote, and they will have many interested takers.

The Brexit negotiations will take at least 2 years. But it could be 3 or 4 years, who knows? May has no power over that durationm unless she walks. She won’t. And as things are drawn out, Juncker et al have all the time and opportunities they want to tell both May and the British public that Brussels has no intention of punishing them, but will have to do so anyway.

After all, Brexit is a threat to the entire European project, and all the leaders of the 27 remaining nations, as well as the vast majority of their domestic opposition parties, are behind that project, no questions asked. And the many thousands of people working their very well-paid jobs in Brussels and Strasbourg are not too critical either.

All in all, the British need to wake up and smell the roses as long as there are any left, and before they have been replaced with less savory odors. Or they will have to seriously wonder whether the Kingdom, united or not, can outlive the Queen, aka the London Bridge.

“London Bridge is Down” was recently revealed as the secret UK government code for the moment the Queen dies.

By Raul Ilargi Meijer
Website: http://theautomaticearth.com (provides unique analysis of economics, finance, politics and social dynamics in the context of Complexity Theory)© 2017 Copyright Raul I Meijer - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Raul Ilargi Meijer Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules