The battle was neck to neck with a difference of a million votes which means the country is split right down the middle: for every one voted Leave, there is one voted Remain, well, almost.
The Brexit referendum on 23 June therefore has been most divisive and there is a need for the nation to heal. But this is going to take some work because even the two major political parties are split. The Cameron/Osbourne camp is not happy with the Johnson/Gove camp. The Corbyn camp is not happy with the Hilary Benn camp.
This political mess is the source of the uncertainty over the consequences of the vote to leave the EU. The uncertainty is that no one at the moment is deciding how the UK should leave the EU. The people are uncertain. The businesses are uncertain. The European Parliament is uncertain.
In this uncertainty, the first instinct of the financial markets is to sell. There is no point holding to your portfolio and waiting for the uncertainty to be resolved. It is better to get out and wait. If you want to get out, it is better to be the first the get out than to the last to do so. This is why the financial markets are selling down.
Is Brexit bad for the UK economy?
In the first place, the world economy including the European economy is already in bad shape before the referendum as a result of the consolidation that is taking place in China which some have forecast that it would take five to ten years for the consolidation to be completed and a recovery engineering with a new framework for domestic-oriented growth in China. US is on the verge of a recovery and the Fed has been trying to raise US interest rates and end the quantitative easing which has so far been creating perverse flows in the global economy.
The major perversion of financial flows in the global economy has been the putting of financial resources in the hands of extremists who now have access to heavy weapons. It is this war that is creating the flood of refugees who are fleeing for their lives and in search of greener pastures that is disrupting the peaceful and happy life of the Europeans. The refugees want to enjoy the lifestyle of the English, French and Germans.
Presumably what Brexit will do first is to put a stop to this uncontrolled immigration into the UK, and in its place will be a process of processing and approval. Other thing else will adjust.
Whether Brexit means a complete withdrawal of the UK from the common market is another point to be argued. Nobody wants to do less trade; it will be silly for the EU if it wants to be punitive in the hope of discouraging other EU components to leave.
No doubt there will be investments which would have come into the UK before Brexit and which may want to rethink, mainly because of the uncertainty surrounding the terms of the departure rather than the unhealthiness of the UK economy which probably is no worse than other European economies. Investments that are already in the UK should have no further push to get out.
Certainly, there are many serious to be discuss between the UK and the EU parliament. It will be a long process of at least five years to sought out all the details, although the main details can be framed within two years. This is when political cohesion in the UK politics is crucial.
I expect the financial markets to recover soon after all the sellers who wanted to sell have sold their position. Then they will start looking at the bright side. By then, 18 months ?, Brexit may be a happy word on the lips of ordinary people.