June 23, 2016, was the date that U.K. voters chose to leave the EU in a national referendum. This was a choice for the so-called “Brexit.”

Everyone realized that a Brexit would take time to implement. There was a formal notification of the intention to leave the EU. This started the clock running on an end date by which time the Brexit would become legally final.

All of this required the approval of Parliament working with the prime minister, Theresa May. The deadline is March 29, 2019, just a few days away. But instead of a smooth process of negotiation, the Brexit process has devolved into complete chaos and disorganization.

In theory, there could be two types of Brexit: a so-called “hard Brexit” in which the U.K. simply leaves with no new arrangements on trade and investment in place is one. The other is a “soft Brexit” in which the withdrawal takes place but many of the benefits of EU membership are preserved. Other options are to not withdraw or to hold a new referendum.

Parliament is badly fractured among these many choices to the point that there is no majority for any one of these solutions. Now the U.K. has turned to the EU for an extension of the deadline to this summer. The deadline extension will likely be granted, but this does not solve the U.K.’s internal political problems.

As this article describes, the situation is so bad that the U.K. may fail to negotiate an exit agreement by the new deadline and May’s government may fall, requiring elections for a new Parliament and selection of a new party leader.

Brexit was always going to be difficult to implement, but no one could foresee the extent of political dysfunction we’re witnessing today. Implications for the pound sterling are highly negative, despite occasional rallies.

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