Over the next four weeks, there will be countless column inches spent debating what a Brexit really means and why it does/doesn't matter.

I will make a simple qualitative observation. You can poke fun at it. But in about six months, you will discover that I was right. And I'd rather be right than smart.

If the UK votes to leave the EU, then Donald Trump will be the next president of the US. If the UK votes to stay in the EU, then Donald Trump will not be the next president of the US.

Yes, it's that simple.

Because I believe that this is really a referendum about voters' trust/rejection of the "elites" — and the EU is the creation and embodiment of the elites. Nationalism, regulation, free trade — all of that is secondary to the populist support or rejection of the "elites". Vic likes the term "flexion" — but that has different meaning. The elites can be found on the left and on the right — they typically were educated at Harvard, Yale, Princeton, Stanford, Chicago. Some may be libertarian. Others may be socialist. But they all cling to the religion and arrogance of knowing what is best for the common man — and which often also involves rejecting common sense and facts in evidence.

The Trump phenomenon is precisely the same wave on a different continent. It's about a rejection of the political and academic elites. Forget about his politics and policies. He has stuck a fork in the elites.

Lastly, I further believe that politically, the UK and the US voter psyche/momentum moves together.

So if the Brits leave the EU, then Trump is in.

So you now know what Brexit means for the presidential odds in Vegas.

What that means for the markets is left as an exercise for the reader.

anonymous writes: 

Right now, over on Paddypower, the odds of remaining in the EU are 2/7 in favor and the odds of an exit are 11/4 against. Meanwhile, the odds for the US presidential race have tightened considerably over the past few days, with Clinton discounted as an 8/15 favorite, and Trump marked as a 13/8 dog, with Bernie coming in at 20/1 and Biden bring up the rear with 33/1. No overlays here. One wonders when they start including Gary Johnson in their line what his odds will be discovered to be. The betting lines for both the EU and US presidential race have been correlated, and are quite close.

Jim Sogi adds: 

I met some people from Scotland a few months ago whilst in Alaska. They were educated, business people. They said the Scottish proposed exit was extremely foolhardy and unrealistic. They said that had they exited, within several months they would have been bankrupt. GB would certainly last longer than Scotland. Its the unmoneyed, uneducated crowd, the Trump folks as RG calls them. The news will have a heyday, but realistically, its not going to happen, yet. The EU will fall apart for other reasons, but not now.


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