♪ mark: welcome to a special brexit bulletin from europe's harrod quarters -- bloomberg headquarters in europe. i am mark barton. the first prime minister is talking with the eu. stirredturgeon also another scottish referendum is a real for -- real option. >> an independence referendum is clearly an option to be on the table, and is very much on the table. and to ensure that that option is a formidable one in the required timetable, steps will

be taken now to ensure the necessary legislation is in place. cabinets this morning formally agreed that worked. -- formally agreed that worked. mark: there's a call for britain to sell out its view on the future time with you europe. about -- youed will meet the prime minister of france and italy on monday to discuss the uk's exit from the eu. the quick brexit process is needed. beating after a meeting in berlin, germany's frank-walter steinmeier said the country make commitments to hold the eu together. france's minister said they need to leave immediately. looking at a market moves yesterday, there were some

sterling full in the most on record against the dollar to the lowest level since 1985. it has dropped as much as 11%. the most incks 2008, after falling as much as 9%. was the haven currency of choice. it had its biggest move since 1998. finally, gold had its best days since 2009, rising as much as 8% earlier on friday. let's get the latest on the brexit vote in a moment, we will hear from a reporter in brussels. first up, let's go to the seat of the u.k. government. anna edwards is that westminster. housing a vacant was her statement -- how significant was the scotland ministers statement. sturgeonrd from nicola earlier on today.

we knew a second random and its referendum could be on the table. she said we took a step towards that today. the distillation is being prepared to pave the way for a possible referendum. going to be one, they want to make sure legislation is in place for them to do that. she also is seeking talks with eu bodies. most people voted to stay inside the eu in scotland. but the country overall was for the u.k. to leave the eu. many in scotland will be disappointed. back in 2014, the time of the independence vote then, part of the arguments for staying in the u.k. was that we keep us within the eu. complicated moving parts certain to take into gear. timing him of the conversation between london and brussels, london and other garments -- governments, a lot of tension has been. ryan has that side of the story.

it is possible we are on different sides right now. is it possible for the eu to force the u.k. out? it certainly does not look like it is possible for the eu to force the u.k. to start those negotiations. look at the treaty, read articles that clearly say it is up to the member states to invoke article 50 and begin those negotiations, the official negotiations. it is up to the members to decide when they are going to do it. it is also up to the eu countries if they want to have any unofficial negotiation's before that red button, if you will, is pressed. it is a stalemate. the messaging we got out of the foreign minister from the six founding countries of the european union that have been meeting today, the messaging is a bit mixed. you have got the french on one side saying, these negotiations have to start immediately as early as tuesday here in

brussels, and on the other hand, you have the germans very clearly saying let's keep this clean. the important thing is these don't drag on. it looks like there is a little bit of wiggle room. was: jonathan hill, who david cameron's man on the european commission, he resigned today. what does that tell us about britain's role in the eu while these executive negotiations are going on? the: i think it tells us uk's role in the eu is in lumbar -- in limbo. it is a lame duck at worst. you think about it, each one of the 28 countries gets a job on the commission. it just so happens that jonathan hill's job was very important. he was in charge of financial services. i think he felt that given financial services and what the role of the u.k. and the relationship when it comes to financial services with the eu is going to be in the future out there, heing

would be inappropriate for him to do that. so he seated that power to the vice president of the european commission, one of john claude yonkers deputies. he said he will make sure in the interim while he takes on the powers he and financial stability. ultimately, this kind of shows exitinge the u.k. is formally or informally, its departure from the european union, it really can't have much of a voice in with the eu does. mark: ryan chilcote, and what edwards, thank you -- anna edwards, thank you. we have special brexit coverage on bloomberg television and radio today. hourly updates, alive special show in under an hour's time. tomorrow, full day of coverage on television and radio, starting at 5:00 a.m. u.k. time. do not miss it. i will get you back to scheduled programming.

it will be high, the vix will 2 35nue to go from 23 4, or 40. that will be dependent on economic growth and the results the things will generate. nonetheless, central banks don't agree with what they have done. i don't agree with them doing their darndest, but you can't find a central-bank that has been proven in the past few years, i don't think investors will try to. erik: more protests since popular is in, that is what bill gross at jenna capital says. columnists that bloomberg, you grew up in england. he wrote that britain faces an unsolvable dilemma, the economy or self-determination. you hosted a forum about the brexit earlier today. tell me, if bill gross writes

that britain's vote says something about the state of democracy in the u.s.? i think it is absolutely right -- clive: i think it is absolutely right. one way to look at the brexit vote is it is a sort of revolt of the people against the elite, and i think that is something you see in many other places, including in the u.s. the political class in britain was out of touch with what people felt about europe. cameron would never have called this referendum if he thought there was a chance he might lose it. it is such a short to the system, the global economic system because nobody thought , this would happen. that is because people making those calculations are not in touch with the way ordinary people think. i see something similar in the u.s. with support for trump and the sort of cluelessness of the political class, liberal and conservative alike, in accounting for the trump phenomenon. and i think you see it elsewhere

in europe as well. deep resentment in the aspects, the way that eu is run, and the growing anti-eu sentiment, and the political class in europe has been semi-paralyzed. they have not done anything to respond to it. and i think brexit is the beginning of the consequences of that complacency. erik: clive, to your point about trump, one of the beauties, or if you prefer the horrors of the brexit vote was that it was about a binary income. in or out. the u.s. election and congressional elections are much more complicated, and they involve many more issues. do you think things as a result will pan out differently than they did, or will we see the same forces take over? clive: well you know, people are skeptical about expert opinions these days. they are right to be skeptical. i hesitate to make forecasts. i didn't think that britain would vote to leave the european union. i never thought that trump would

win the nomination. so i think it would be fair for people to ask what do i know? that thereld say is is great risk here that we are finding that we don't understand quite what is going on in these political systems. and the brexit vote shows you that the consequences can be severe. one thing i would just say, you know, right before you said, erik, the brexit vote is complicated. one way, it is in or out. right? i see that. so the implications where we go , from here, that is an extremely complex question. there is a whole range of outcomes with this deal that now needs to be negotiated between europe and britain. it is very hard to say how that will end up. europe might press for a very hard bargain in order to discourage other potential quitters.

and if that happens, i think the consequences are britain and for europe might be even worse. erik: well, clive, i will have the opportunity to check in with you later in the hour. we will explore that thought. we return here on this special report, we'll take you to the continent. what is next for the eu? and we will sit down with former prime minister of italy mario monti. how does he see it playing out? more as this special bloomberg report continues next. ♪

♪ erik: europe's foreign ministers are convening in berlin for an emergency meeting to discuss what brexit means for the rest of the eu. here is how leaders reacted to the vote. have a look. donald tusk: i'm fully aware of how serious or even dramatic this moment is politically. there is no way of predicting all the political consequences of this event. francois hollande: an awakening is needed. europe cannot deal like it was before. the people are waiting for the european union to reaffirm its values: freedom, tolerance, and peace. angela merkel: more and more frequently, we see ourselves confronted with the fact that

people have very basic doubts about the direction the european unification process has taken. >> the british people chose yesterday. we respect this decision. now the page turns. it's an unprecedented day. not an easy one, but europe has demonstrated over the course of its history that become stronger in the face of every difficulty. erik: don't play campaign games with europe. that is the message from former italian prime minister mario monti. he spoke with francine lacqua just before trading got underway on friday. they began by asking monti whether the brexit was the worst case in history for europe's political leadership. mario monti: it may indeed lead to a more fractured europe. the eu and the u.k. had decided to remain, the all too general treatment given in february by

the other 27 to the u.k. would have created the temptation and -- in many other member states of the eu to say, ok, we too want to negotiate the ability to -- the conditions, in order to belong to the eu. exit is the worst possible scenario, i believe honestly, much worse for the u.k. than the european union. i believe the u.k. would be bitterly disappointed in seeing how long and how adventurous would be the street, the road to wards new agreements with partners of the eu, and how weak its domestic economic policies will be. at any rate, i see one, just one, but big positive to this

, drama. >> what is that? mario monti: well, for the first time, it is very, very clear to everybody that you cannot play games with europe. without running serious risks. >> dr. monti, within that, you were at yale university studying under james tobin. is this the moment where we change the dialogue on italy's austerity, spain's austerity, the united kingdom's austerity? with this politics, do we change our dialogue and decision-making on fiscal austerity? mario monti: i think brexit has nothing to do with that. the dialogue on austerity as i a bit ins to change the sense that austerity first, a word, a word first of all

without sense, i never use it. but fiscal discipline has to stay. we, in italy for example have , paid huge prices for not sticking to fiscal discipline. but we need to change the mind of the germans. and it is not impossible, to -- believe me by telling him genuine, public sector investment is not a violation of fiscal discipline. this is the only change which is really needed. francine mr. monti, if we just : take a step back, what exactly does this historic moment mean? eurp you are a zero -- ophile, but is this the end of the european project? are we going to see more referendums, including in your country if it is possible? mario monti: it is possible, it is possible it could be the end. if you follow just a second, the most serious risk of unraveling

of european integration is that national leaders, more or less, all of them, deal with europe, treat europe, participate in european decisions, having in their mind as top priority their electoral result or even their electoral result in the public opinion polls next week. and we cannot expect europe to to take the right decisions when the most important body, the european council, is filled with persons like this. so i believe that the catastrophe, triggered by mr. cameron, showing that indeed, you can be inflicted huge pains if you play these games, may bring more wisdom, more sense of responsibility to the others. erik: former italian prime minister mario monti speaking to

tom keene and francine lacqua. up next, we speak exclusively to u.s. national security advisor susan rice on the brexit. britain's decision to exit the european union. ♪

♪ erik: welcome back to our special coverage, britain out. president obama talked about the uk's decision to leave the eu speaking to an audience of entrepreneurs at stanford university. the president said he is confident britain is committed to an orderly transition out of the eu. my colleague david gura sat down with ambassador susan rice for an exclusive interview. and david began by asking her about the potential national security risks that could stem from this historic decision. susan rice: we respect the decision of the british people. and this is not going to change fundamentally the special relationship between the united states and britain which has endured historically for generations and generations.

nor will it change the nature of our relationship, the united states' relationship, which is a -- with the european union, which is a critical economic and security partner for the united states. so we have every interest in supporting the european union as -- and britain as they work to affect an orderly process of separation. we have every interest obviously also in maintaining the strong security relationship that we have within nato which includes not only many of the countries of the european union but of course of the united kingdom, and that will endure. so i think the security implications need not be particularly significant, assuming that britain and the european union continue to cooperate as they have for many years under the umbrella of nato. we remain committed to the transatlantic relationship as always. and we expect that britain and europe will too.

david: what role will the u.s. play in that orderly transition in london and brussels? , susan rice: we won't play a direct role. obviously this is something to be negotiated between the united kingdom and the european union itself. but because we are critical partners with the european union, we will try to help them to the extent that we can as they request to support the stability of europe and britain economically, of course. we will continue as we always would in any event to maintain our strong security ties and to work together with the european union member states as well as with the u.k. on things like migration, on dealing with refugee flows, countering terrorism. all of these things are areas where we would work together in any case, and our support and engagement has been critical has

been critical and will continue to be. david: do you worry this will weaken nato? susan rice: no, i don't see it impacting nato. erik: that was david gura with ambassador susan rice. clive is still with me from washington. clive, the ambassador wants us to, at least to a degree, to believe not much will change. i'm not so sure. i am asking myself what does , this mean for multilateralism? what does it mean for nato and military alliances? what does it mean to the commitment to free trade? what does it mean to the efforts, for example, to relieve poverty? what does it mean for the fight against climate change if nations, not just britain turn , inward? clive: actually, i don't see it so much as a case of britain turning inward. i know that is one possible interpretation, but it seems to me britain is very , internationally minded. it is very outward looking. something the leave campaign stressed is they want closer relations with non-eu countries.

so i think it is wrong wor too much about a breakdown of the spirit of internationalism. i think it is much more about discontent with europe, with the european union, with europe's arrangement. i agree with what susan rice said. there are so many common interests when it comes to national security that i would be surprised if, you know, if national security interests were impacted by this to any significant extent. i don't see that happening. erik: the europeans and the british share enough as they look, for example east to russia , or to china, for example, that their future is tied together. clive: absolutely, and i don't see any dissent from that view on the leaves side on the brexit debate. erik: it's good to see you. thank you for staying with us on this special report. still to come, everyone, you will hear from more people with

real money at risk. what the wild market swings warranted. and how much should we make of psychological contagion? we are going to be tackling those issues next. our special coverage continues all weekend long. tune in on sunday at 5:00 in london. ♪

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erik: you are watching a bloomberg special report, i am erik schatzker. it was a brutal campaign that left deep scars around the united kingdom. remain or leave? markets don't vote, but on friday, investors around the world paid the price as the shock of britain's decision to leave the eu set in. stocks changed the most since the financial crisis, with trading volumes higher than the 30-day average. currencies were shot. they pound fell to 1985 levels, and the yen surged. the drama isn't over. scotland is threatening to break away from the u.k. solidarity remains in question.

we cast our net across the financial world to gather opinions that matter. here is what they have to say. >> the british people have spoken. their decision is to be respected. it will be some time until we know the nature of the future relationship between the united kingdom and the european union. in the meantime, it will be important that there be clarity on the negotiation process and that it be carried in as smooth a matter as possible. >> as a backstop and as a function of the markets, the bank of england stands ready to provide or to provide more than 250 billion pounds of additional funds. >> saying for at least a year, brexit vote would lead to it downgraded in the u.k. sovereign rating, which is currently aaa, which is the last of these

around. that is what we said. erik: wherever you look, the market reaction was swift and dramatic after thursday's vote. the approach taken by most was shoot first, ask questions later. howard marks of oaktree capital, one of the credit investors, has seen dozens of crises before. so i wanted to know what he makes of the turmoil in the months to come. howard, you may be surprised, is not jumping on the bandwagon. howard: there is no history for this kind of development. i don't see how anybody can be confident they know what it means. i think these economies will slow down. there probably has been a synergistic effect on the u.k. and europe from membership in the eu. they will probably each produce a little less on their own than they would have produced together. i think there will be a psychological effect as people pull in their horns and spend

less and invest less. i would be surprised to learn that this is a long-term fundamental negative. for these countries. erik: why do you say that? howard: i just think the reaction is very strong in the markets. but the question is, are people going to live differently? are people going to produce less and are people going to buy less? you told me, erik, even when there are crashes on the pound, on the stock exchange, the people outside are still buying hot dogs. other than psychological contagion, which should not be underestimated, i don't think that this is a fundamental catastrophe. now, i do think there will be very strong societal, societal and political and geographical ramifications, but i just, i have trouble dealing with it as

a financial catastrophe. erik: ok, if it is not a financial catastrophe and things over the medium are going to be ok here, yet at the same time they will be confusion, which i will translate to uncertainty, should be the order of the day, what is the logical thing to do for an investor? shoot first and ask questions later? -- sell first and ask questions later? howard: that doesn't only a very clever or stable position. you know, there is an old saying i have heard for many, many decades, as long as i have been in this business that the markets have poor uncertainty. -- abhor uncertainty. they do. that doesn't make them necessarily correct in their abhorrence. what it means when uncertainty rises, people get uncomfortable. they do sell. that doesn't make them right. i don't see why increased uncertainty in itself makes selling the right thing to do.

it is always a matter of what are you selling, at what price, what are the things that might happen, what are their probabilities? the mere fact uncertainty has increased doesn't mean it is time to sell. erik: does it mean the people who are selling today, just does it mean the people who sold earlier, selling today, when we were at the lows, they are going to regret those decisions? howard: they may. not that they will. but they may. i just don't see the math through which increase uncertainty means you should sell, and certainly not that you should sell at any price. the clever people were the first to hurry or the news and say, that is it, i will get ahead of everybody else by selling. they put the thing down into percent. at the opening, a percent or so. right now, it puts you down 4%. so what that means is, they are wrong.

erik: that was oaktree capital cofounder howard marks. the brexit throws the future of london into serious doubts. so perhaps it was no surprise bank stocks took a beating. after thursday's vote to leave the eu, marking their worst single day decline in four years. credit suisse fell 14%, oakmont is one of the biggest credit investors. he is now sorting through the wreckage for buying opportunity. >> certainly, there is considerable more short-term uncertainty in the environment. that's never good. on the other hand, prices have reacted quite negatively. you mentioned credit suisse, but look at the periphery banks. there is a sao paulo and even a

french bank, bnp paribas, not to mention what has happened to the u.k. banks. i think people are comparing this with what happened seven or eight years ago. it is not a direct comparison, -- correct comparison, given the state of capital positions. the banks are in a better much, much better position to weather these uncertainties that we are now facing. and i think we do have some positives. there's a very strong global consumer out there, high employment rates, low unemployment rates, low energy costs, low interest rates, consumers are doing pretty good. they are not as indebted as they were in 2007 and 2008. we don't have these debt overhangs. there are some negatives with the uncertainty of what is going to happen with the united kingdom and how it relates to europe, but on the other hand, the banks are in a better position to deal with this uncertainty if you look at their leverage ratios and capital ratios. i would say some of this, some of these 20% down prices are perhaps overdone.

guy: wells fargo market down 5%. european bank stocks down 10%. david, would you go shopping at these levels? try to get a sense of what you would do. david: keep in mind, they were already selling at low valuations before this happened. yes, there was a lower rally this week, but if you look in the last eight, nine months in anticipation of this, if you look at the valuations, they were already reflective of something coming. i don't really like to comment on current trading, but our motive of operation is to determine intrinsic value of a business, and price separates itself quite aggressively from what we believe. as it approaches intrinsic value, it will attract.

-- we subtract. i don't think the intrinsic value of these banks has fallen by anywhere near what the market has done to their prices, as a sign of their prices. you can almost guess what our thoughts are right now. guy: let's try and confirm your thoughts. did you buy credit suisse on the drop? david: again, i can't really talk about our trading. but i would say at this price, credit suisse is attractively priced. some of these other european financials. now again, there is going to be short-term uncertainty and volatility. it is to be expected. erik: guy johnson pressing david pharrell -- the brexit debate may be resolved. one question is scotland. remember, scotland held a referendum in 2014 and voted to stay in. but thursday's decision may change all of that. francine lacqua reports from westminster. francine: scotland is making a lot of noise.

we heard scotland did the decisive vote for remaining in. so they don't want to lose out membership for the eu. she hinted at the fact there could be a referendum. whether it will come soon -- a second referendum -- or if they will wait a bit, it is not clear. they have nothing to gain in rushing through the referendum. actually as you say, this will play out for months and years. we don't really know what they u.k. will negotiate with the eu. so scotland will wait first and see if they get a deal with the eu, and then we go. erik: that was francine lacqua reporting from westminster, talking to our colleague sarah pharrell. -- jonathan. coming up, we hear from mohamed el-erian why this doesn't live up to the lehman moment. stay tuned. ♪

erik: this is special coverage, britain out, i am erik schatzker. aftershock after the decision to leave the european union continues to jolt markets worldwide. on friday, stocks tumbled as the pound touch lows not seen in more than 30 years. we caught up with the bloomberg view columnist mohamed el-erian ready for exchanges on friday morning. he joined jon ferro and guy johnson for this interview, and they begin by asking mohamed what bank of england director mark carney needs to do next. mohamed: he needs to make sure banks have enough liquidity, that is the first thing. second thing, he needs to get on

the phone like others and talk europe into developing a plan b that has some sort of association agreement. the worst thing that can happen to markets right now is to have this notion there is nothing to replace eu membership. coming up with a plan b is going to be absolutely critical in weeks to come. jon: it doesn't look like we are going to get a plan b for a long, long time. they have not triggered article 50. there is talk of waiting for october for the conservative party minister conference. that article is actually triggered. we could be here until october. how significant is that? mohamed: that would be really bad news, markets don't respond well to vacuums. if there is no clarity on what institutional arrangement could emerge next, then you are going to have the worst combination, which is institutional uncertainty on top of financial

fluidity, on top of economic fragility. having a plan b is going to be critical in the days and weeks to come, if this financial shock doesn't develop into a much bigger global economic shock. mark: it looks like nobody has got a good hand of cards here, but if you were sitting around the table, you have angela merkel, who has the better hand of cards here? mohamed: i don't think it is about who has better cards. it is about holding together, and they will have to work quickly to avoid a recession. it's not easy to change institutional linkages overnight. so there is a reason why the european stock market is doing worse than the u.k. stock market. it is because this is also a major shock for europe. if europe cannot navigate this well, then there is going to be a lot of questions on who comes next. i think this is not as much who

has the better hand as collectively, they should hold hands and try to make the best out of this. this phenomenon is all over the western world. you should realize that a majority of people of decided to go against expert opinions, to go against both the political and business elites and express anger and frustration with this new normal period of low growth and rising inequality. this is a very important wake-up call to politicians all over the western world. -- advanced world. guy: left look at the east side of the table. we already have francois hollande and angela merkel saying this needs to be done quickly. you seem to be comparing that view when you time to figure out what we need to do here. does either side have a clearly thought out plan? does either side have a plan of what comes next? mohamed: my hope there were contingency plans. there was a plan b being

discussed. of course you wouldn't talk about it publicly, but there were things being discussed. if, in fact, a plan b wasn't discussed, you are going to see a lot more financial volatility ahead. jonathan: i wonder how much a financial shock it is. we can let the intraday moves the for themselves. the ftse is actually up on the week and the pound is back to levels this on earlier in the week. how much of a financial shock could this actually be with that in mind? mohamed: it can be a significant financial shock. but the good news is, this is not lehman. this is not a payment and settlement crisis. it is a shock to the institutional setup. it will cause some major financial moves. and you are going to see the financial sector block more than technology when the dust settles. i would just caution, don't draw too many implications from what

you have seen so far. we still haven't seen accounts close their positions. we still haven't seen how the retail segment is going to react. so don't extrapolate too much on what you have seen so far. this is still the early days of the technicals perspective. there is also the economic question. it is early days yet in terms of how markets are reacting. guy: why shouldn't we actually -- extrapolate into other events? donald trump was on our side of the pond today. why shouldn't we actually we have more political events like this? we have french elections, german elections, so much more political upset that could come down that results from this, maybe doesn't result from this. this could be the first of many. mohamed: it is not even the first. this is just a continuation of unthinkables that have become

reality. why? people are angry and you get a strong protest vote without thinking about what the consequences of the protest vote is. having said that, there is a probability, small, but a probability this could finally be a wake-up call to the politicians. remember the context. what is ailing us is not an engineering problem. most economists have a good handle on what is needed to promote high inclusive growth. what is ailing us is the political will to affect a handoff from overreliance on central banks to a comprehensive policy response. maybe this could serve as a wake-up call. erik: "it could be a wake-up call." he wants to be optimistic. bloomberg view columnist mohamed el-erian. when we return, hear more brexit reaction from business leaders around the world. stay with us on bloomberg television.

♪ >> june 23 needs to become a national bank holiday, and we will call it independence day. [applause] david cameron: i think this country requires fresh leadership to take it in this direction. boris johnson: britain will continue to be a great european power. ♪

erik: i'm erik schatzker. you are watching our special coverage of the brexit, britain out. leaving the eu will be a messy process and business leaders may not know the full impact on

their companies for months or possibly years. but already, they are taking stock of the situation and trying to come to grips with an uncertain future. >> i'm afraid that this is definitely not a good day for europe. there is no doubt the consequences will be negative on all sides. as a briton and a european, it especially saddens me that the european idea obviously has lost its attractiveness to so many of my fellow countrymen. that is a clear signal to the eu to get closer to its people and to strengthen democracy. as a bank headquartered in germany, and with a strong hub in the u.k., we are well prepared to mitigate the consequences. >> we have an unwinding process ahead of us with the eu, which will take considerable time. it is not just the two years, it is not just the triggering of 50. it is the renegotiation of all these trade agreements. there are resources we have to negotiate. some people talking up to 10

years to renegotiate these agreements. the concern is to say the least, really troubling. >> we don't see riding on the street anymore related to this anger, but you do now see digital rioting. if you pay attention to the media feeds, the social media feeds, you can read some of the anger that people have had, conventional wisdom was wrong again. erik: europe needs a new playbook. and it is now looking to its largest economy to take charge. caroline hyde reports from germany. caroline: one of shock and concern clearly. we are speaking to leaders in foreign policy particular. they say, overall, a catastrophe for germany and the eu. angela merkel is a voice of calm at the moment, typically pragmatic as she is the leader of germany. she has got a very difficult balancing act, vonnie.

on the one side, wanting to punish the united kingdom, hold them up to prevent anyone else from calling referendum and start this domino effect so feared in the eu. we have the right wing parties from france and spain already desiring that own referendum. talking about a rush through to get this deal done with the u.k. and to immediately start with start -- preparations for an exit. she's been the voice of reason. wanting to see a calmer measure is because she realizes the other side of the balancing act, business side of the balancing act. she was to support the business ties. she wants to ensure the economy progresses as best it can. >> you will be covering this meeting on monday when the french and italian ministers arrive in berlin. what do we expect out of that meeting? caroline: monday of course, merkel has summoned her counterparts. in italy with frenzy, and donald tusk, the head of the eu.

he has been the president. he said this incredible words. if we did indeed see the u.k. leave the eu, it could spell the end of western political civilization itself. but those leaders will be gathered together, and they will want to start to decide how they will lead the eu to be cohesive, how they will prevent any sort of domino effect playing out. that way they will prevent concerns in the right-wing populist expression, starting to rear what many feel is its ugly head. there is much to look at. erik: that was caroline hyde, and this was a bloomberg special report on britain's decision to break from the european union, a historic decision rocking global markets on fridays with repercussions unfolding in the coming weeks, months, and years. stay tuned this weekend for special programming here on bloomberg television, on bloomberg radio and on bloomberg.com. ♪

>> the brexiteers get shy. the leave campaign softens. >> a dismembered eu changes its tone. how can the eu keep its credibility. sufferasset classes whiplash. ♪ francine: welcome to our bloomberg it special.