Theresa May has officially begun the Brexit process:

Theresa May has told parliament that she accepts Brexit will carry consequences for the UK, as a letter delivered to Brussels began a two-year countdown to Britain’s departure from the EU.
The prime minister made a speech on triggering article 50 minutes after the European council president, Donald Tusk, confirmed he had received notification. He declared that “the UK has delivered Brexit” nine months after a bruising referendum campaign.

“We understand that there will be consequences for the UK of leaving the EU. We know that we will lose influence over the rules that affect the European economy. We know that UK companies that trade with the EU will have to align with rules agreed by institutions of which we are no longer a part, just as we do in other overseas markets. We accept that,” she said.

A number of MPs congratulated the prime minister on the tone of her letter to Tusk, which stressed Britain’s commitment to the continent as a close friend and ally. But others accused her of issuing a “blatant threat” to withdraw security cooperation if the EU27 fail to deliver on a trade agreement. The letter suggests that the government hopes to roll the separate issues together, claiming no deal will mean WTO rules but also that “our cooperation in the fight against crime and terrorism would be weakened”. May’s spokesman repeatedly insisted placing security and trade relations alongside each other in the letter to Tusk was not intended as a threat. “It’s a simple statement of fact that if we leave the EU without a deal, then the arrangements we have as part of our EU membership will lapse,” he said.

This is going to be a bumpy ride.

The expectations on the British side are somewhat self contradictory, and there are elements of the EU establishment (and not just Wolfgang Schäuble) who want to make the UK an abject lesson for anyone else who is considering either an EU or Euro zone exit.

This is going to be nasty divorce ugly.