Brexit has raised questions about the sustainability of the European Union and shared currency. In many ways, the future of the European Union depends on Brexit's failure. Because if Brexit actually makes Britain better off, more states are certain to leave.
The European Union has serious fault lines that may cause the entire system to implode.
The shared currency prevents the poorer states of Southern and Eastern Europe from being able to weaken their currencies and remain competitive in the global economy. On the flip side, the shared currency artificially weakens Germany’s currency and makes the exporting nation unfairly competitive – much to the ire of Donald Trump.
The unemployment rates in Southern Europe are astronomical compared to Germany, Britain, and the United States. Unemployed minds are fertile soil for populist mass movements. And populist politics are beginning to take a distinctly euro-skeptic stance.
Brexit, if successful, may be the death blow to the European Union. And the European Parliament probably will try their best to make the eventual separation as punitive as possible. So far, the Union is seeking to prevent parallel talks (no negotiating with individual member states) and pushing for billions in commitment fees.
The British Economy continues to hold up in the meantime, but it is unclear how the process will end. Gold is good insurance against further declines in the British currency and a possible meltdown of the EU.