Forget chaos in Washington – investors should worry about Le Pen

It isn't an American default that investors need to worry about, says Matthew Lynn. It's a French one.

What was the month's biggest political event? The markets were obsessing about the US government shutdown and a possible debt default. But while that is a remote possibility, in reality the president and Congress will tie up a deal at the eleventh hour. The real shock was closer to home and is potentially more worrying for the markets.

France's National Front leader, Marine Le Pen, is edging ever closer to real power. And with an economic programme that verges on bonkers, she poses a threat to what is the world's fourth-largest bond market, and home to some of its biggest banks. A Le Pen-triggered French default is a lot more likely than an American one.

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Matthew Lynn

Matthew Lynn is a columnist for Bloomberg, and writes weekly commentary syndicated in papers such as the Daily Telegraph, Die Welt, the Sydney Morning Herald, the South China Morning Post and the Miami Herald. He is also an associate editor of Spectator Business, and a regular contributor to The Spectator. Before that, he worked for the business section of the Sunday Times for ten years. 

He has written books on finance and financial topics, including Bust: Greece, The Euro and The Sovereign Debt Crisis and The Long Depression: The Slump of 2008 to 2031. Matthew is also the author of the Death Force series of military thrillers and the founder of Lume Books, an independent publisher.