This has to incubate with me for a day or two before I can comment any further.

Europe has gotten along just fine thus far without a constitution, and after all the changes of the past few years, a little gridlock won’t necessarily be a bad thing, in so far as it gives people time to absorb all the changes to date. This turgid brick of a constitution was a disaster in the making, and in the years to come advocates of the EU will be grateful that they were saved from their own worst tendencies by the French and Dutch electorates, if only they can muster the willpower to try again for something a lot more modest and transparent. Vive la France indeed!

If the process stops (which I think is not such a good idea), he’s off the hook for the UK referendum. If it continues, he’s already had an election in which the people had the chance to give him a bloody nose. Now they can consider the EU on its merits, or at least insofar as the UK debate is ever related to the reality of the EU. Further, from the little England point of view, can anything opposed by so many Frenchmen be all that bad?

What we have is uncertainty, under conditions of uncertainty investors tend to go for the safest bet. Strangely enough this is still likely to be the dollar. So money will be coming into the US, as people, obviously sell euros, anticipating a reduction in its value. So……..

The US treasury will have an additional flow of non-Chinese funds, and will not be so dependent on China to sell US government debt. Hence they may be able to take a stronger line. Just a thought.

Of course, if this does happen, longer term interest rates will effectively drop, which will only make the distortions of the housing boom worse.

On the taxes I wouldn’t be too sure, on the other items you could be right, but since none of them are realiseable, we have a crisis about the ‘reality’ of voter expectations.

Well London isn’t, but in Paris and Frankfurt it should be business as usual. The US I think is closed today. There is Asia too remember. As it happens the euro is already falling there, but only very moderately. I guess we will have a clearer picture on Tuesday.

I don’t think there will be a big initial reaction. As many have said, the markets were probably already anticipating a ‘no’.

I think the impact will be seen over weeks and months. And it will be seen as a reflection of how our institutions react. There are perhaps four main items: the EU budget, the Stability and Growth Pact, the ECB and the euro, and the Lisbon reform process.

If agreement on a new budget, which has already proved complicated, only becomes more difficult, then this will obviously be negative. If Almunia isn’t tough on Italy and Portugal, ditto.

As I posted last week the ECB is having a credibility problem itself, and people will be looking long and hard at Trichet on Thursday.

Then there is the Lisbon process. Was the vote yesterday in favour or against? I think this isn’t clear at this time. The worst issue is there will probably be a crisis of weak leadership in France until the next presidential election. Yesterday’s vote now makes Sarkozy the likely winner, and is most likely to be very strong on Lisbon.

At some stage, the EU political leadership will turn this situation round, in the sense that they restore confidence in their ability to carry the majority of voters behind them on EU issues. But it is the time between now and then that is going to be tricky.