In what will be remembered for years to come as an economic and political turning point, the Established Order has been rebuked in a dozen profound ways:
1. Let’s not kid ourselves, the Brexit vote was about immigration and the Islamization of Europe. Politicians are capitalizing on people’s fears,and those fears seem legitimate.
2. A death blow to free trade and globalization. Even Hillary Clinton — an architect of free trade deals — now repudiates them. Victimization is all the rage, and the victims of free trade have the upper hand.
3. Who’s next? Several candidates, but let’s focus on the Big One — France, reeling from terrorist threats, strikes and a stagnant economy. A recent poll showed 61% of the French people want out of the EU.
4. Good luck propping up Greece: Voters won’t tolerate it. No more special deals for profligate countries, those days are gone.
5. Austerity is radioactive: The pendulum already was swinging sharply against austerity; fiscal policies may loosen, not a moment too soon. Interest rates are so ridiculously low that deficits and inflation would actually be welcomed; bond markets wouldn’t care, at least not initially..
6. Everyone hates Germany: Angela Merkel has been loathed outside of Germany because of her bitter fiscal medicine, but now her popularity at home is fading. The reason — see point one — is the surge of Muslim immigrants, which she has encouraged.
7. Brussels Equals Washington: No one wants to be dominated by faceless bureaucrats. The contemptible London newspapers — scrambling for profits in a dying industry — have exaggerated the impact of Brussels on British life, but the public revulsion toward Brussels bureaucrats sends a clear message to Washington.
8. Janet Yellen’s reaction: Not only is a rate hike off the table for the rest of the year, weaker economic growth may prompt the the Fed to consider what once was unthinkable: non-traditional monetary policies.
9. Another blow to the polltakers: Let’s be blunt — the polltakers stink. They have huge problems with their methodology — cell phones versus land-lines in particular — but there’s a more important issue: people who hold controversial views don’t like to admit it to strangers.
10. A huge blow to Barack Obama: Already reeling yesterday from a Supreme Court ruling on immigration, Obama must realize that his intrusion into the Brexit vote actually hurt David Cameron.
11. Vladimir Putin must be happy. The EU is so dysfunctional that the notion of Europe stopping Russian aggression is laughable. The Brexit vote should make people in eastern Ukraine very, very nervous.
12. Donald Trump must be VERY happy. Enjoying his best week after a two-month slump, Trump has an opening. A seething resentment of the establishment is bubbling up everywhere, and this week’s turmoil — from the floor of the House to the financial markets — only helps him.