Source: Economic Times
The European Union is in a difficult spot, one which they'll have to juggle with if they want to have some degree of success in convincing member countries the benefits of remaining outweigh the benefits of leaving.
One of the presidents of the EU, Donald Tusk, sounding out shrill alarmism, said this:
As a historian I fear that Brexit could be the beginning of the destruction of not only the EU but also of western political civilization in its entirety.
The problem with using this type of rhetoric is it can come back and hit you just as hard as you were trying to strike a blow. Tusk and the EU now face the fallout from this.
After warning of the destruction associated with a Brexit, in hopes of influencing voters using fear tactics, now that it has failed, and Britain, on a daily basis, will be a testimony against the use of "end of the world" assertions if countries leave, I see the EU quickly changing strategies and moving more toward the positives associated with remaining in the EU.
Here's what investors need to know. Britain has always worked its way through difficult times, and it'll do so again. This will infuriate globalists behind the scenes, but eventually the attacks will have to stop as the rhetoric will be found to not represent the reality on the ground. This is why there will be a move to change the narrative to a more positive outlook, otherwise people will start to ask themselves why all the nightmare scenarios aren't playing out in their lives.
Also important is the upcoming recession, where all countries will experience economic struggles. If there is too much negative rhetoric cast Britain's way, the obvious idea of why they're going through tough economic times will raise its head among the masses, and the question once again of "what's in it for me?" will be asked by the general populations, who see the carnage and crime associated with immigration far outweighing the questionable economic benefits of remaining in the EU. Carnage for limited cash isn't a good marketing message for the EU. It won't be able to avoid it if millions of immigrants are encouraged to continue swarming into Europe.
There will be more countries leaving the EU in the years ahead. It's not that there won't be an EU in some form, it's that it's going to go the way of the United Nations, which has become an impotent, irrelevant organization with little if any impact on society and civilization.
Investors need to understand this is the direction the EU is now going, and there is nothing that can stop it. It's only a matter of how long it takes before it becomes just another tattered dream of the globalist elites.
Where EU proponents like Tusk are delusional
If you didn't catch it in Tusk's comments above, I'll point it out. Tusk's assertion suggested all of western political civilization was represented by the EU. To him, this is the only world he understands or is part of. Anything outside of the EU is secondary at best, and needs to take on the characteristics and guiding benevolence of its leadership.
What Brexit has done, as the British did using arms in World War II, has caused those seeking control to realize their plans and their organization are effectively over. It'll take time for this to work out, but the unraveling of the EU has begun, and it'll gradually and consistently lose power and influence over the next decade, as well as a number of members.
For someone like Tusk, this is the end of the world - his world. Those living the EU fantasy are experiencing, and will continue to experience the same thing. That's why, for a relatively short period of time, we'll continue to see a negative narrative surrounding the UK leaving the EU, but that will quickly change when it's realized Britain will do just fine on its own.
Again, too much negative rhetoric not conforming with obvious reality will only encourage more departures from the EU. This is why it's in the best interests of the EU to turn more positive on what it allegedly offers to its member states, rather than try to castigate and denigrate the UK, which will do just fine after leaving.
As for Tusk, he continues to be delusional. After the UK vote, he said this:
Today, on behalf of the twenty seven leaders I can say that we are determined to keep our unity as 27. For all of us, the union is the framework for our common future. I would also like to reassure you that there will be no legal vacuum.
The problem for Tusk here is he's acting as if there aren't a number of populist uprising in a number of 'union' members, of which the leadership isn't among the twenty seven leaders he's referring to when talking about keeping the unity.
He's acting as if the unity won't be disrupted by the people in these nations who want change and want out. What he and the twenty seven are going to quickly find out is they may want a union that brings them a common future, but millions of people don't.
In other words, the twenty seven are no longer representative of the overall EU, as the people, as represented by a number of new leaders, are taking back sovereignty of their individual countries. There's a new twenty seven, and they don't have a "common future" in mind the globalist elites are looking for.
This is only the beginning of the huge disruption of the EU, and before the smoke clears in the years ahead, it'll be smaller and far less influential than its founders and supporters had hoped for.
For investors, over the long term is needs to be understood the viability and very short-term power of the EU is over. The economic pressure and value of the past will quickly dissipate, as the union attempts to keep a weak and cobbled-together group of countries in line with their failed vision and goals.
It's going to be on the defensive in the years ahead, and won't be able to use the pressure it has in the past to get its way, as it is forced to go into survival mode. The next recession will make it happen much quicker.
Impact of recession
The most important thing to understand with the next recession, as it relates to the EU, is all the countries will be suffering economically. Many will look at Britain's exist from the EU, and ask themselves what remaining in the EU gives them.
When accompanied by increasing violent crime from immigrants, populism and nationalism will increase in intensity, and the EU won't have the ability to keep the union together as it now stands. This will put the final nail in the coffin, as far as it becoming more of anemic in its influence. As I mentioned, some semblance of the EU will remain, but it will be smaller and ineffective as an entity.
Like the United Nations, nobody will take it serious or listen to it anymore; it'll be considered more of a curiosity and remnant of a time when elitists actually believed they could control the thoughts and actions of people and nations.
Any investors with positions in companies doing significant business with the EU, should take this into account over the long term. No matter how it is spun, the EU is, as it now stands, in decline. It will never be able to reverse direction. Momentum is going to quickly change to nationalism and localism, with populist candidates being voted in and leaving or significantly changing what the EU has been. The recession will hasten that outcome.
Negative to positive narrative
After the initial flurry of negative stories and alleged implications of the UK leaving the EU, there will definitely be a change in the narrative, with the EU starting to market itself as a positive influence for its members.
As mentioned, the primary reason for that is Britain will do very well on its own, and continuing to point out negative outcomes when the country is economically sound, will undermine the need for countries to be part of the EU.
Even the idea of a recession hitting Britain as a result of leaving the EU is disingenuous, and will be counterproductive, because the upcoming global recession will cause some pain for the majority of countries. The EU would have to answer why it is struggling economically along with Britain, if being a part of it reduces the impact of a recession.
It of course won't be able to answer that, and it'll trigger even more doubt about the value of remaining in the EU at the cost of national sovereignty.
What the EU wants is for the media to take its focus off of the UK and start focusing on its spin in the months ahead. It can't do that immediately, as there is too much interest in the implications of Britain leaving the EU. But once that dies down, which shouldn't take long, I believe we see a lot more of the supposed beneficial side of remaining in the EU.
That will be used more to keep weaker countries from wanting to leave, but won't have an impact on those already moving in that direction.
No matter how it is spun in the months ahead, the EU is effectively in the beginning stages of its demise. This isn't only from Brexit, but from the growing resistance to wealthy and powerful elites that have tried to override the sovereignty of nations at the expense of the people that make up those nations.
The response have been an extraordinary populist movement in Western countries that can't and won't be assuaged until they regain control of their countries. Few, if any, care about the consequences of the EU, which is correctly perceived as the enemy in all of this.
When all the media hype clears away, in the end, there is really only one basic reason the UK left the EU: nationalism trumped globalism. It's as simple as that. Citizens may not have understood all the nuances of what was happening and why, but they did understand they were being forced to accept unwanted immigrants who had no interest in the nation itself, and little regard for the people. Accompanying crime waves and brutal attacks only made the problem more visible, boosting resistance.
In the end, it was correctly understood that powers outside of the country were pulling the strings, and they decided they wanted to take their country back. This is the impetus behind populist movements all across Europe.
People relate to their respective nations, not some global bureaucracies that the elites can use to extract what they want from citizens of the countries, including their capital and lives, as far too many have discovered by experience.
Investors need to see that this is only the beginning of the end of the EU, and while there will remain a group of countries under that moniker, what it was in the past will no longer exist, and in the years ahead it'll be considered the remnant of another quaint move to control the nations of the world. Invest accordingly.
Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.