What many analysts still see as a temporary bubble, pumped up by artificial and unsustainable monetary stimulus, is maturing into a structural expansion of economic activity, profits, and employment that probably has many more years to run. There are at least four reasons for such optimism.
With talks on the UK's withdrawal from the EU stalled, negotiators should shift to the temporary “transition” Prime Minister Theresa May officially requested last month. Above all, the negotiators should focus immediately on the British budget contributions that will be required to make an orderly transition possible.
Last year’s "multi-crisis" in the EU – including Brexit, refugees, “illiberal democracy” in Hungary and Poland, and the still-unresolved euro crisis – has produced a convergence of opportunities. With Germany's election over, European leaders no longer have an excuse for inaction while they wait for voters’ next rebuff.
The British political establishment is now converging on a form of Brexit that will satisfy neither the "Leave" nor the "Remain" camp. With this depressing prospect setting in, some are starting to wonder what it would take for Britons to change their minds about leaving the European Union.
Since the global financial crisis began a decade ago, there has been no shortage of useful ideas for ameliorating economic conditions and alleviating public resentment. The real question is why so few of them have been implemented.
In the wake of the UK's snap election, how long Theresa May will survive as prime minister is impossible to predict. But in trying to anticipate the outcome of the Brexit negotiations, the questions that matter no longer have much to do with May’s political survival.
Britain, France, the United States – which is the odd one out politically? The answer seems obvious. Last year’s Brexit referendum in the United Kingdom and the election of Donald Trump in the United States were the twin symbols of populist revolt against global elites. In Emmanuel Macron, France, by contrast, has just elected as its president the quintessential “Davos Man” – a proudly globalist technocrat identified with his country’s most elitist financial, administrative, and educational institutions.
The election called by UK Prime Minister Theresa May for June will transform Britain’s politics and its relationship with Europe, but not necessarily in the way implied by a large majority for May’s Conservatives. Britain’s pro-European progressive forces could still snatch victory from the jaws of defeat for three related reasons.
The Dutch are famous for building dykes that hold back the tides and storms sweeping across the Atlantic. Have the Dutch now done it again, stopping the wave of populist politics that has been threatening to engulf Europe?
Ongoing congressional gridlock will be the key to continued buoyancy in US equity markets, says Gavekal Dragonomics’ Anatole Kaletsky. It’s when Trump’s agenda starts to be implemented that the euphoria will wane.