Conditions for investors around the world are getting worse.

Let’s start with Europe, the world’s second-largest economy. The European Union is a collection of states that are vastly different from one another. They are separated by culture, language (which impedes labor mobility, resulting in semi-permanent labor productivity disparity between countries — think Greece and Germany), economic growth rates, indebtedness and history.

European political (EU) and monetary (EMU) unions were great experiments that made a lot of sense on paper. Europe, at roughly the same-size population and economy as the U.S., was at a competitive disadvantage as dozens of currencies embedded extra transaction costs in cross-border trade, and each currency on its own had little chance of competing with the U.S. dollar for reserve currency status.

There were also important noneconomic considerations. Germans were haunted by their past; they had started two world wars in the 20th century, and a united Europe was their way of lowering the risk of future European wars.

Economic and monetary union sounded like a logical marriage of all the significant powers of post–World War II Europe, but the arrangement was never really a marriage. It was more like a civil union. EMU members combined their currencies into one, the euro. They agreed to use the same central bank and thus implicitly guaranteed one another’s debts.

Though treaties put limits on budget deficits (limits that, ironically, Germany was the first to exceed), each country went on spending its money as it wished. Some were relatively frugal (like Germany); others (Portugal, Ireland, Italy, Greece and Spain) went on spending binges, like newly hitched college students who had just gotten their first credit card, with an irresistibly low introductory rate and a free T-shirt.

Now let’s turn to Brexit, the U.K. referendum on exiting the EU. Ironically, the U.K. doesn’t have half the problems that most EU nations are going through. Because it is not part of the EMU, it has retained its currency and its central bank.