What I See In A Post-Brexit World

Barely twelve hours ago the British voted to cast off the European Union like yesterday's underwear.

Already, the historic vote seems to herald some monumental changes, not just in Britain, and on the European continent, but I believe it could also affect global trade, markets, and political alliances much more than many analysts seem to think.

Here, in no particular order--except the order in which these thoughts surface--are the notable shifts and changes I see evolving over the next two to five years.

1) Britain will have to develop new markets and trading partners to make up for the loss of continental markets that may be closed because of EU trade barriers and EU resentment over Brexit;

2) The pound may be a problem. A lot depends on whether or not the City's vaults contain gold enough to assure pound-takers that it retains its stability, or whether the gold has been sent to Asia as part of the Federal Reserve's effort to make the dollar look good;

3) Global VIPs have been salivating for decades over the prospects of a world that the members of their club could "manage" to their satisfaction. Today that dream doesn't look nearly as certain.The plan isn't coming together as they'd planned, expected, pushed, legislated, hyped and propagandized;

4) There will be enormous anger released, in overt and subtle ways, against the British for daring to upset the carefully-brewed teapot. President Obama threatened the British with the image of having to go to the end of the line to do post-Brexit business with the US. That may or may not be the case, but it seems logical that Britain may have to get on the tail end of the line to do business with countries that remain in the EU. Britain should expect no favors from what remains of the EU;

5) This is where it also seems logical to expect Britain to develop closer and expanded economic/trade ties with UK members, with developing nations, with Middle East oil producers, with China (which already has a presence in London), and, should the US give Britain the cold shoulder, Britain could lead a move to restore relationships with Russia;

6) The British political landscape will certainly be changing. What will the "new guard" look like? Who will rise, like a new Churchill, to lead the country after this "Independence" vote? Whew! Parliament will look and feel like a merry-go-round combined with a Ferris Wheel and a roller-coaster...with a water slide thrown in for good measure. This will "retire" some leaders and will elevate others who are still out there on the horizon. But, the vote gave instructions to "Take care of Britain First." So, insular priorites, values, policies, and politics will be revolutionary;

7) One can only wonder how the far-flung remains of the British Empire will react to Brexit. How will Canada, Australia, New Zealand deal with Brexit? So far, I have seen and heard no reaction from any of these nations.Will their alliances, policies, and politics go the way of the Motherland, or will they strike a more independent stance themselves, edging away from Britain's lead? My guess is that stronger democracies will emerge in these peripheral nations, which will result in greater individual independence. My thought is that these "family members" will look at Britain extricating itself from Europe as a pattern they can employ in extricating themselves from some "family" ties and obligations;

8) Brexit initially weakens two currencies...the pound and the Euro. Despite woes, the pound should show resilience (again depending on what's in the City's vaults). The Euro will only go downhill, even with Draghi doing whatever it takes to push it back up into the Alps. The demise of the Euro will be hyper-inflationary for the nations clinging to the EU. It may make EU-produced goods less costly, but who, in a deflationary world of negative rates, will be able to buy them? And, how will a weakened pound and Euro affect other global currencies and precious metals?;

9) Gold and silver will, after a long drought, sprout some green shoots. Comex has, with Government/Fed/Treasury blessings, blatantly suppressed prices on precious metals for years, but things have changed. Comex has led a global fire sale with paper bargains in gold and silver that have been bought on the engineered dips. Now, the stream of PMs that have flowed from West to East through Swiss refineries doesn't appear as plentiful as before. On top of that, there's the new Chinese gold market that buys and sells actual metal instead of paper. The Chinese (and all of Asia, the Middle East, and Russia) have been content to buy all gold that the West has been selling. But it's hard for me to see London selling much more gold--if it still has gold to sell. So, if the gold flow to China stops, China's metal market will come to replace the Comex as the price setter for precious metals. When that happens, currencies will tank, and precious metal prices will look like they have tanks of rocket fuel strapped to them;

10) There's a saying about the best-laid plans of mice and men.The One-Worlders aren't going to curl up, wither, and die. But, at a time when it seemed victory was within their grasp, when they had the world by the tail with a downhill pull, the islanders of England decided to opt out. Not only opt out of the EU, but to opt out of a world where an increasing FEW were coming to rule an increasing MANY.

Greece would have exited the EU years ago were it not for "concessions" that a desperate EU provided Greece in order to maintain the illusion of E-Unity. Voices in France have been clamoring for that core nation to leave the EU, but Italy may beat them to it. Britain has started the Recessional, and it will be fascinating to see how many fence straddlers there are...and how many nations that have been hot to join the EU now develop chills.

I will, and I suspect we all will, be watching to see what the outcome of Brexit will be, and I haven't even touched on how it might affect the US Presidential campaign...though, while the Donald may not have endeared himself to the Scots, he may receive a warmer welcome in Britain now that anti-Brexit politicos are exiting their positions of VIP-dom.