It was only one year ago that the United Kingdom's economy was projected to surpass Germany's and Japan's by 2030 and become the world's fourth largest behind the U.S., China and India, according to the Centre for Economic and Business Research. That a nation with one-fifth the population of the U.S. could be considered to belong in these ranks is amazing.
This morning uncertainty rules after the U.K. delivered a resounding rejection to the European Union, economic elites and the Davos crowd. As someone who awoke a few hours ago in London to watch a stunned NATION come to grips with the will of its people, it already appears that those celebrating will ultimately regret what they have wrought.
Only London, Scotland and Northern Ireland voted to remain in the EU. Scottish politicians immediately renewed their calls FOR independence while Sinn Fein, once the political arm of the Irish Republican Army, called for Northern Ireland to leave the U.K. and unite with the Republic of Ireland. Were either or both scenarios to occur, the U.K. would become a truly Little England. Scotland is already appealing to the EU to continue its membership.
If nothing else, the vote was a victory for those seeking to profit from disorder. The Brexit vote was enough to bring legendary speculator George Soros out of retirement. In the next few weeks, we'll learn if he still has the hottest hand in the hedge fund universe when it comes to profiting off of global crises.
Donald Trump congratulated the U.K. on regaining its independence. Today, he is scheduled to visit Scotland, where his mother was born. Reports are that he will greeted by protesting Scots waving Mexican flags. But global growth is likely to slow significantly in the next few months and that can only help him, even if no politician in England or Scotland is willing to meet him.
How this all plays out is anyone's guess. However, buyer's remorse is already surfacing and not just in the U.K.
European business leaders are not happy. BMW, which counts the U.K. as one of its top markets, says it has no immediate plans to change where it makes cars. If the pound remains at current levels, the lowest in 30 years, manufacturing in the U.K. could become more attractive.
But that is the silver lining. U.K. Prime Minister David Cameron resigned and said the nation should proceed to exit the EU with caution. In the Labour party, MPs moved for a vote of no confidence on its far-left leader, Jeremy Corbyn, who views make Bernie Sanders look like a moderate.
Leaders of the Brexit movement appeared to try to walk back their vitriolic language and appeal to disillusioned, pro-European British youth. Leave leader Boris Johnson had compared the EU to Hitler, a classic final refuge for demagogues.
German Chancellor Angela Merkel also voiced her regret and sounded like as though she wanted to accommodate the U.K. Many people, including Brexit supporters, would like to retain their economic union while terminating their political merger.
Whatever side one is on, most agree that the whole European unification project was poorly conceived from the start. Those who thought through various aspects saw it coming. The U.K. was fortunate Chancellor of the Exchequer Gordon Brown short-circuited Prime Minisister Tony Blair's plan to join the disastrous euro currency.
Besides BMW, German business executives have indicated that they fear a trade war and would like to maintain the free-trade zone. But EU president Jean-Claude Juncker, who hails from mighty Luxembourg, is advocating adopting a hard, take-no-prisoners line with the U.K. and cutting them no slack lest other nations get the idea they might be able to enjoy the benefits of the EU and none of the nuisances.
Juncker is just the sort of officious, Brussels-EU twit whose down-your-throat edicts to the 28-member nations spawned the anti-EU movement in the first place. But just like Brexit blowhards here like Boris Johnson, he now finds himself in a no-win, no-man's land.
If he backs down and tries to accommodate the U.K., many of the other 28 nations may try to negotiate their own separate side deals. If he doesn't, other nations like Hungary, Greece, Spain (or at least Catalonia) and France could decide to head for the exits. Good luck, Jean-Claude.
Outgoing Prime Minister David Cameron wants to proceed gingerly with the U.K.'s exit from the EU, but Jean-Claude wants to make an example of them to sppok others. Don't let the revolving door hit you on the way out is Jean-Claude's attitude.
While Germany is likely to seek leniency for a major buyer of its exports, the French are expected to be vindictive. For what it's worth, by late Friday many European equity markets were down worse than England's,indicating that the pain could be felt far and wide.
Meanwhile, on the streets of London, ugly behavior in this remarkably decent, civilized society was on display. As a housemaid who came here 26 years ago from Portugal went to work, drunken celebrators told her to go back to where she came from.
Nicola Sturgeon, First Minister of Scotland, had a message for her and other Europeans who moved here under the EU's freedom of movement laws, including one million people from Poland. They are welcome in Scotland.