Proud Prophet.

The "moron risk premium."

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1. France:

Emmanuel Macron pitched himself as a bulwark against the rise of the far right in France when he burst onto the highest political stage and became president in 2017.

The leader of the European Union’s second-biggest economy has instead ushered in a period where far-right leader Marine Le Pen is not only the chief power broker in Paris, she’s closer than ever to the ultimate prize: the Elysee Palace.

Macron’s grand plans are now stuck in a cul-de-sac of chaotic failure after she allied with other parties on Wednesday to topple Prime Minister Michel Barnier. He was appointed just three months ago by Macron to lead a minority government and keep the project alive.

France now has no fully-empowered government — and no obvious way to form a stable one for months — the public is frustrated, and there’s a growing budget crisis. Investors have driven up risk premiums on French assets over peers to levels not seen in more than a decade and sent stocks plunging. The benchmark equity index is on track for its worst year relative to Europe’s Stoxx 600 since 2010.

Macron’s loosening grip on his agenda and Le Pen’s ascent mark the apex of a years-long battle between two visions of France and the European Union…

The uncertainty over France’s direction couldn’t come at a worse time for the EU, with the Russian army threatening its threadbare defenses, its companies outgunned by the financial muscle of American and Chinese competitors, and the prospect of a hostile US president about to return to the White House. (Source: bloomberg.com)