Prime Minister Boris Johnson (BoJo) raised the prospect of a snap election after he suffered a major parliamentary defeat over his Brexit strategy that could delay Britain’s exit from the European Union (EU). Just six weeks after taking office, the Conservative leader was hit by a huge rebellion among his own MPs that leaves him without a working majority in parliament as he looks to take Britain out of the EU on October 31. Confusing yes, so what now?
Despite the nice flow charts from the BBC, here are the two basic strategies in play. First the Remainers and the globalists. Either a no-confidence vote against BoJo or BoJo himself will call for a snap election. In the meantime, the UK Parliament will pass a temporary Brexit delay to allow for this election. The EU will gladly grant this Brexit delay in hopes of the Remainers to gain parliament seats to stop Brexit. News Forecasters believes that the Conservatives will lose some support, but not to Labor, rather to Nigel Farge’s Brexit party. Perhaps a poor calculation by the current parliament and the EU. It will be another close vote of 50%/50%.
On the other side, the Brexiteers are now in scramble mode. BoJo will be working overtime to try some parliamentary gymnastics to regain control of the agenda. News Forecasters believes BoJo does have the Royals on his side – any Brexit deal reasserts their power. BoJo is brash enough to give it a good shot. A 50%/50% exercise. If BoJo fails we go to the snap election, which we already have stated is another 50%/50% exercise.
The recent events have obviously hit hard the hard Brexit odds for October 31, 2019 – as you can see in this inset chart. News Forecasters previously said that BoJo would eventually engineer a Brexit medium-light deal and get Britain out of the EU by October 31, 2019. News Forecasters still holds to this final outcome that a Brexit medium-light will come. However, we may have to go through this snap election first – off on the timing.
Looking at the GBPUSD, the traders are cheering the current situation. The belief is that a hard Brexit won’t happen soon or not at all. Markets seem to like this outcome. Looking at the technical inset chart, the GBPUSD just made a good reversal Doji. We could get a nice short term reversal rally off the recent lows, but we are not out of the woods on Brexit and market will churn at these lows for a while – following the news flow. If the situation gets worse or even more global negative effects hit Britain, we could even see lower lows.
So Britain’s future is in flux for the short term. For now, News Forecasters uses the historical arc of history to guide us. Britain has and will never be part of mainland Europe it is historic – e.g. WWII. However, via immigration, Britain’s culture and its vision of its future have changed. This is a demographic situation – whether you like it or not. The future arc of history says Britain will eventually succumb to this new vision unless the demographic situation changes – not likely. Has this day finally come? We shall see.
A video presentation of this subject: