Bad News for Those Feeling Smug About Brexit’s Economic Slump

In a year full of enough craziness that June 24 seems like ancient history, Brexit has fallen from our memories.

The news warned of economic collapse, and when the London Stock Exchange (LSE) took a hit, lots of folks that know basically nothing about international trade agreements patted themselves on the back and sneered at the economically-backward thinking of Brexit.

The conclusion was drawn–Brexit was a terrible economic decision–put in a box, and packed away to be pulled out and shown, without re-examination, at the next cocktail party where we’re trying to impress folks with how worldly we are.

I decided today to pop back into the box and dust it off.

Since Brexit’s bottom-out, the London Stock Exchange has gained 12%. Since the day before B-day, it has gained 6%.

The US Dow Jones Industrial Average has gained, in comparison. 0.7%.

This is a pretty big post-Brexit Boom. Turns out economics and international trade are complex, and there’s disagreement over what’s driving it. Higher exports from lower Pound? General economic reshuffle? Help from Quantitative Easing? Bubble-about-to-collapse from Quantitative Easing? Belief that there won’t be Brexit after all and something else good happened, unrelated? I don’t know. And I don’t intend to try to explain it here.

But here’s my point: if it had dropped and stayed low, “everyone” would know why: Brexit was a terrible economic idea. Maybe you have held to that theory.

Now that the economy is instead booming, what chance is there that you or others may start to think, “maybe Brexit wasn’t such a bad economic idea after all?” Or are people so attached to the conclusion they already made that they’ll start scrambling for an alternative explanation: “Brexit is still a terrible idea, and since I have evidence to the contrary, I have to go find a reason that the economy boomed so I can maintain that Brexit was a terrible idea?”

Maybe–just maybe–most of us don’t actually have enough background in economics, international trade, and the specifics of the UK economy and EU trade deals to know what we’re talking about? I certainly don’t.