Location: 48 degrees, 02.12 minutes North, 043 degrees, 42.08 minutes West, or 1,421 nautical miles ENE of New York.

The Queen Mary 2 is currently plowing its way through a massive fog bank a thousand miles thick, sounding the foghorn every two minutes. Visibility is less than 100 yards, and the waves are a rough 12 feet high.

The captain has closed the outside decks for fear of losing a passenger overboard. The weather has disrupted our satellite link, and our internet is down. So here I write.

One hour out of New York, and a passenger suffered a heart attack. So the captain turned the ship around and headed back to the harbor, where the New Jersey Search and Rescue sent out a launch to pick up the unfortunate man and his spouse.

That meant we could pass under the Verrazano Bridge three times, on each occasion deftly clearing the span by a mere ten feet. Talk about inauspicious beginnings.

The ship is truly gigantic. You must allow 20 minutes to get anywhere, 5 minutes to walk there and 15 minutes to get lost. When launched in 2003, it was the largest cruise ship ever built at 148,900 tons, nearly double the size of the now decommissioned Queen Elizabeth II.

It whisks up to 3,000 passengers and 1,325 crew across the seas in the utmost luxury at a steady 21.5 knots. You could water ski behind this leviathan of a vessel, if only the crew permitted it.

As a 40 year guest of Cunard and the highest paying customer on the ship, I managed to bag the Sandringham Suite, possibly the most luxurious publicly available oceangoing accommodation ever created.

The 2,200 square foot, two floor, two bedroom, three bathroom, Q1 class apartment on decks nine and ten included a formal dining room, kitchen, his and her closets, a small gym, and 1,000 square feet of rear facing teak deck.

All of this was a bargain for $56,000, or about the same as renting the presidential suite at the San Francisco Ritz for a week at $10,000 a night, except at the end you wake up in England five pounds heavier. Not that I noticed, though. By the afternoon, the two complimentary bottles of Dom Perignon Champagne were already headed for the recycling bin.

The suite came staffed with two full time butlers, Peter and Henry, who were an endless font of fascinating information about the ship. During one unfortunate cruise, eight senior citizens passed away.

The morgue held only six, so the extra two were stashed in the meat locker for the duration of the voyage. No comments were every made about the seasoning of the steaks that week.

I asked if Cunard ever performed burials at sea in these circumstances. They said they used to. But a few years back an elderly billionaire ?Mr. Smith? checked into a deluxe Q1 cabin with a hot young ?Mrs. Smith?, and then promptly expired. The grieving widow requested he be buried mid-Atlantic with the traditional yard of sail and a cannonball.

When the ship docked at Southampton, a much older, real ?Mrs. Smith? appeared to claim the body, and sued the company when informed of his current disposition. So, no more burials at sea.

Yes, the ship did hit a whale once, which stuck to the bulbous bow. When it landed in Portugal, Cunard was fined for commercial fishing without a license. The unlucky cetacean?s skeleton is now in a Lisbon maritime museum. Apparently this company gets sued a lot.

Of course, the memory of the sinking of the Titanic is ever present. There is a history display down on deck 2, and you can even have your photo taken in front of a backdrop of the grand staircase of the ill fated ship.

When we passed 10,000 feet over the wreck at 48 degrees, 38.50 minutes North, 50 degrees, 00.11 minutes West one day out of New York, the Queen Mary 2 let out three long blasts of its horn in memory of the lost. Cunard took over the Titanic?s White Star Line during the Great Depression and is therefore the inheritor of this legacy.

Peter is now at the door with my dinner, so I will continue on another post.

From Your Correspondent in London

The evening started out so hopefully.

My old employer, the British Broadcasting Corporation, projected in bright lights, a running referendum tally on the side of the building in giant ten-foot tall numbers.

When we went to bed, early results from the cities were showing a 52% to 48% margin in favor of keeping Britain inside the European Community.

When I awoke the next morning, I turned on the TV to find British Prime Minister David Cameron resigning, the government in disarray, and Britain out of the EC by a 51.9% to 48.1% vote.

The pound had crashed from $1.50 to $1.30.

Everyone in the government that I?d spent the week advising on the dangers of an exit vote, was suddenly out of a job!

What?s to follow?

The dismemberment of the United Kingdom, the collapse of the European Community, another Great Depression, and perhaps WWIII.

The big winners? A newly reviving Russia that is watching the alliance on its border crumble, and perhaps Ireland, the new HQ for multinationals seeking an English speaking base inside Europe.

As for the US, it now has a handful of weak allies instead of one strong one. Our growth will slow, as it will be around the world.

Any chance of a Federal Reserve interest rate hike this year has been obliterated. My friend, Janet Yellen, can go back to sleep for another year.

Absolutely no one saw this coming. Even London?s notoriously canny bookies missed it by a mile, losing some 150 million pounds on ?remain? bets gone awry.

The bigger problem is that the largest hedge funds were caught totally wrong footed by the result, expecting a ?remain? vote to lead a global ?RISK ON? rally that would take stocks and sterling to new 2016 highs.

Their awkward positioning is triggering enormous stop loss selling that will no doubt spill into the week ahead.

District by district analysis spoke volumes about the state of class and wealth fractiousness in the UK.

Americans take note.

The blue-collar union workers won at the expense of the white-collar middle class.

A manufacturing minority won at the expense of services majority.

The old won at the expense of the young.

The uneducated won at the expense of the educated.

The emotional and ideologically driven won at the expense of the numeric and the rational.

Call it the referendum devoid of the thought process.

It was all a rare opportunity for computer illiterate, angry old white men to thumb their nose at the one percent.

The ?exit? leadership, led by London former mayor, Boris Johnson, has absolutely no plan for going forward.

Fear of immigration was the principal reason why so many voted to depart from Europe.

Literally thousands of Middle Eastern refugees are camping on the French end of the Channel Tunnel, desperately seeking a safe haven and jobs in the UK through any means possible.

The government has agreed to take 80,000, spawning fears of Islamic terrorism. Even though all of the domestic terrorist incidents that have occurred so far, have been committed by British born citizens recruited by ISIS online.

Speaking to dozens of ?exit? voters in pubs, restaurants, and on trains, it was clear that a promised increase in government benefits and subsidies was a major driving factor. Much was said about unelected elites.

The reality is that those benefits will get slashed as government tax revenues implode.

Many complained about falling real wages and standards of living. But these are the results of hyper accelerating technology and globalization (competition from China), not EC membership.

If anything, EC membership buffered these negative influences.

And here is the problem.

I remember what England was like before it joined the EC in 1973. It was a poor, strike prone, mildewing country with lagging technology and a per capita income a quarter that of the US.

But most British voters are too young to remember that.

Today, standards of living are amazingly on parity with those of the US, thanks to a four-decade boost produced by the benefits of being within Europe.

The detrimental effects of the vote are almost too far reaching to imagine.

London cranes are about to become an endangered species as real estate prices crash. Residences and office space there are no longer the well-organized entry point for Europe.

A market size that has just shrunk from 520 million to 50 million requires considerably less office space than it has now.

And the one million Poles who were brought in to build them? They will be sent back, ending $1.5 billion a year in remittances to their home country. Poland will suffer.

I could go on and on.

It was a classic case of failure having many fathers.

Certainly the Tory government did a poor job making their case to stay. Too much focus was placed on the immediate multi billion pound cost of membership, and not the tenfold increases in indirect benefits.

When all those newly minted foreigners go, they will take their money and their spending with them.

The US also deserves its fair share of blame here, which inadvertently unleashed a cornucopia of unintended consequences.

When it invaded Iraq in 2002 based on faulty, cherry picked intelligence, it destroyed Iran?s largest enemy and created its largest ally.

That emboldened Iran to keep the Syrian civil war going five years longer than it should have, unleashing one million refugees on a defenseless Europe with porous borders.

This revived the ugly face of nationalism, racism, and nativism, at the expense of globalization. Social services groaned from the weight.

We are all now paying the price.

Other disaffected Europeans have read the writing on the wall and may follow with their own ?Dexit?, ?Frexit?, and ?Nexit?.

Scotland, which voted heavily to remain in the EC, is already moving for another referendum of its own to go independent.

So did Northern Ireland, which is now eyeing reunification with the South.

The United Kingdom will be cast into the dustbin of history.

The European Community will disintegrate into the same passel of squabbling nations that brought us World Wars I and II, except that this time, the Germans have nuclear weapons.

Vladimir Putin will take great joy playing one off against the other.

It?s just a matter of time before Europe gets its own Donald Trump. The last time that happened, his name was Adolph Hitler.

The weekend after the vote, it was as if the nation woke up from a wild party with a giant hangover and asked ?Oh my gosh, did I really do that last night??

The search for a morning after pill is on.

I would bet big money that if the vote were held again today, ?remain? would win by a decided margin. It would require a swing of only 1.9% of the vote to do so.

Fortunately, there are ways out of this for the UK, and the rest of us.

National elections in two months could produce a strongly pro Europe British government that will devise ways to negate the vote and get back into the continental association.

Every business in the country is waking up Monday morning to massive order cancellations across the board.

UNCERTAINTY is epidemic, and when that happens, business decisions everywhere are put on hold, bringing the economy to a screeching, juddering halt.

Good luck getting it restarted.

A sharp recession is already upon the UK, although i
t may take three months for the numbers to reflect it.

Sterling will certainly become the next currency to post negative interest rates, putting it into free fall. It should eventually drop to parity against the US dollar, back where it was in 1985.

The inflation that the Bank of England had been seeking will arrive in spades. Import prices just jumped 12%.

Yes, you could make an argument that a bargain basement currency is positive for British manufacturing. But most of that decamped for China years ago.

It could well be that England gets sick of three years of nonstop recession, and separatist leaders making lame, whiny, and nonsensical excuses all the way, then votes to rejoin the EC.

That is, if the Europeans will take them back. And at what price?

Fortunately, US financial assets are looking pretty good in all of this mayhem.

Higher yields will attract a safe haven bid, first for bonds, and then stocks. The greenback (UUP) will reign supreme, except against the Japanese yen, where ?RISK ON? unwinds will drive it higher.

The ten-year Treasury yield could crater to 1%, taking the United States Treasury Bond Fund (TLT) up to a stratospheric $150.

The S&P 500 could widen out from a 5% to a 14% trading range going into the US presidential election.

Use any visits to the $1,812 level to load up on high earners like biotech (IBB), cyber security (PANW), big tech (MSFT), (FB), and junk bonds (JNK).

At $1,812 the (SPY) will tempt you with a dividend yield of 2.75%, the highest anywhere.

US presidential aspirant Donald Trump, who was visiting the UK this week, said, ?The British got their country back?.

The Donald may also be well on the way towards his fifth bankruptcy. The value of his $600 million investment in Scotland shed $70 million in value overnight. Demand for luxury condos and exclusive golf memberships just vaporized.

It?s probably the only positive result of this referendum.

The London Cranes Are the Next Endangered Species

Come join me for lunch for the Mad Hedge Fund Trader?s Global Strategy luncheon, which I will be conducting in Dubrovnik, Croatia, on Thursday, July 7, 2016.

A three-course lunch will be followed by an extended question and answer period.

I?ll be giving you my up to date view on stocks, bonds, foreign currencies, commodities, precious metals, and real estate.

And to keep you in suspense, I?ll be tossing a few surprises out there too. Enough charts, tables, graphs, and statistics will be thrown at you to keep your ears ringing for a week. Tickets are available for $217.

I?ll be arriving at 11:30 AM and leaving late in case anyone wants to have a one on one discussion, or just sit around and chew the fat about the financial markets.

The lunch will be held at an exclusive five star hotel, the location of which will be emailed with your purchase confirmation.

Dubrovnik is the pearl of the Dalmatian Coast on the Adriatic Sea and it?s a favorite yachting destination by vacationing continentals. Its white sand beaches and azure waters are legendary.

It was founded in the 7^th Century by refugees fleeing the fall of the Roman Empire. At the height of its power in the 14^th Century, it rivaled Venice for the domination of maritime trade in the Eastern Mediterranean. Today, it is a UNESCO World Heritage Site.

The last time I was there during the Yugoslavian civil war in the 1980?s, I was flying a humanitarian mission for the International Red Cross, delivering much-needed drugs to the beleaguered city.

On the way home, I got shot down by the Serbian Army. Fortunately, I managed to crash land my plane in the Austrian Alps and walk away.

While at the Tesla factory in June, amazingly, I ran across a couple of Austrian car dealers who still remember that frightful day.

This time around, I?ll spend my mornings writing deep research pieces for the Diary of a Mad Hedge Fund Trader, and the afternoons roasting on the beach. The evenings are reserved for dancing on the tables in the many local bars, celebrating life.

I look forward to meeting you, and thank you for supporting my research.

To purchase tickets for the luncheon, please click here.