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Today was supposed to be the day of the big Brexit breakthrough. The 27 EU leaders (and Britain’s Theresa May) are meeting for a summit in Brussels to discuss migration, borders, the digital single market and Britain’s departure from the bloc. They will be deciding whether sufficient progress has been made for the Article 50 talks to move on from the divorce terms to the future relationship. Based on what Donald Tusk, president of the European Council, has said, the nod is unlikely to be given until December. There might be a compromise — look for talk of “beginning internal preparations” for phase two of the talks — but it will still be a failure.

So what happens next? Talk of a “no deal” Brexit is likely to ramp up in Britain, with Conservative hard-liners calling on the government to increase preparations for leaving the EU without an agreement. In an FT View, we call on Mrs May to hold her nerve and stick with the negotiations. As well as wasting crucial time, doing otherwise would increase the bad blood between London and Brussels and undermine Britain’s reputation abroad. Investor confidence will be being shaken if a “no deal” Brexit becomes the most likely scenario.

The blame game will also start about the failure to make sufficient progress. The EU, for its part, has been somewhat inflexible on its approach to sequencing these talks — how can you resolve the Irish border question, for example, without discussion about the end state of Brexit Britain? Mrs May, for her part, has failed to deliver on some of the promises made in her Florence speech. A deal might be close on EU citizens’ rights but the British government has yet to put more details forward about its financial obligations.

In order for talks to move on from divorce, Mrs May must spell out what the UK wants from Brexit: what its economic model and trading relationship will be after it leaves the EU. Her government might be deeply divided on the issue, but she cannot dodge it forever. The UK must decide whether it wants a relationship with the bloc akin to Norway’s or Canada’s. Until then, the bluffing will continue. 

Crisis at Goldmans: John Gapper looks at the fall in bond trading revenues at Goldman Sachs, concluding that the bank is facing an identity crisis. When you rely heavily on one engine and that engine sputters, John points out you are in trouble. Lacking a consumer arm, like Morgan Stanley or JPMorgan, is proving problematic.

Trump trade: Edward Luce says Donald Trump is likely to fulfill his promise to rip up the global trading system, potentially by withdrawing from Nafta and the WTO. The willingness to compromise that is required in successful trade talks could not be further from Mr Trump’s “winner take all mindset.”

Saving Iran: Roula Khalaf argues there is an opportunity for European leaders to step in and save the Iran nuclear deal. Although the US president has not withdrawn, Britain, France and Germany can step in (potentially with the help of Russia and China too) to ensure it does not entirely fall apart.

What you’ve been saying

Uber: let the venture capitalists beware— letter from J M L Stone:

“Uber operates at a huge loss, funded by the venture capitalists who hope/expect that its penetration of the market will, at the end of the day, bring profits. If profits do eventually arrive, Uber may have “seen off” the black cab trade in London and it will then be in a position to raise its prices. Will Uber’s customers be pleased to be faced with (much) increased prices when what principally, although not solely, brought them into the Uber fold in the first place was the fact that its fares were way below the black cab trade’s regulated prices?”

Comment from A I v.2 on It is time to jettison the Myanmar fairytale:

“As long as the educated elite and the military in Myanmar bury their collective heads in the sand and deny basic rights to minorities, in particular the Rohyngia, then there can be no resolution to the current situation. The government needs to give full citizenship to the Rohyngia, allow them a right of return and grant them their equal and democratic rights. Until their political rights are guaranteed by law and fully enforced, the Rohyngia will remain either as outcasts in their own country or in exile in the squalid refugee camps of Bangladesh. Myanmar needs to take responsibility for the brutal and murderous campaign it has waged against its own civilian population.”

Shape bonus schemes to an organisation’s culture— letter from Anthony Carey:

“An issue not just for corporate boardrooms but also the public and third sectors is whether there should be separate enhanced schemes for board members and senior management or alternatively a common scheme across the organisation, John Lewis style, albeit that senior team members will receive more if a common percentage is applied to all salaries. The latter approach focuses on the team rather than the individual.”

Best of the rest

The lie that poverty is a moral failing was buried a century ago. Now it’s back — Fintan O’Toole in The Guardian

Political argument in Britain has stopped when we need it most — Nick Cohen in The Spectator

Why Democrats Need Wall Street — Douglas Schoen in the New York Times

Is Populism a Threat to Democracy? — William A. Galston in the Wall Street Journal

The march of the grumpy Tories — Katy Balls in the i paper

Today’s opinion

David Gardner: Palestinian accord reflects the dynamics of the Middle East A reconciliation between Fatah and Hamas comes amid power shifts in the region

David Pilling: How the gloss came off Kenya’s Supreme Court ruling If Kenyatta wins the election, it will be a hollow finale to a battle for democracy

Roula Khalaf: How Europe can save the Iran nuclear deal Enlisting the help of China and Russia could encourage Tehran to join new talks

Anjana Ahuja: Medieval diseases are making a grim comeback The return of plague and cholera reveals a fragile stand—off between humans and bacteria

EM Squared: Nigerian bond deal unlikely to herald bright new dawn Deposits and loans continue to fall despite end of painful recession

Edward Luce: Donald Trump’s poisoning of global trade The suspicion is that the president never wanted to make deals in the first place

Free Lunch: Disagreements on eurozone reform may produce best outcome A common ground could be to combine a euro budget with a debt restructuring mechanism

The Exchange: Why Wall Street’s fear index remains calm The Vix index is a 30—day measure and does not give weight to long—tailed risks

John Gapper: Goldman Sachs suffers an identity crisis Retail banks used to envy its glamour but now it needs to mimic them

FT View

FT View: Both the UK and the EU need a solution to Brexit In a feverish atmosphere, Britain should avoid undue brinkmanship

FT View: The defeat of Isis is not enough to save Raqqa The US is ill—prepared to take advantage of the Syrian city’s fall

The Big Read

The Big Read: Election tests Macri’s promise to make Argentina ‘normal’ again Legislative poll will be a referendum on the reformist president

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