Confidence-sapping Brexit is the last thing Bay Street needs

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• The latest developments: How Brexit happened and what’s next
• Global markets shaken

Let's be honest: Brexit-induced chaos is the last thing Bay Street – and global capital markets – need right now.

Early this year we were reminded of investors' frighteningly fragile confidence. In the first week back to work after the Christmas holidays, fears about Chinese economic malaise sent markets into a tailspin. That shock, coupled with plummeting oil prices, put Canadians in the dumps. On Bay Street, it was an ugly reminder of just how quickly sentiment can turn.

We're seeing a sudden shift again today – only amplified. And this time it's all the more frustrating, because before Thursday it felt as though North American financial markets were finally getting back into decent shape. The S&P/TSX Composite Index was hovering around 14,000, U.S. initial public offerings were starting to show signs of life and Canadian investors were showing a propensity to invest in riskier energy companies again.

It is far too early to say if that re-emerging confidence was all for naught. One of the crucial lessons gleaned from nearly a decade of market turmoil since the global financial crisis started is that human beings are incessantly irrational. Every time equity investors have found reason to flee the markets – after the United States lost its 'AAA' debt rating in 2011, after Chinese stock markets started to capitulate last summer, after Greece's countless near-debt defaults – they've eventually found reason to dive back in.

That's not to say this time won't be different. London is a global financial centre, and while the Brexit won't change much there in the immediate future, all of the uncertainty about what's to come could ripple through markets for some time.

Still, there should also be hope that the U.S. economy could continue to surprise us. Pretty much every time investors have suggested the market is down and out, the recovering U.S. economic engine has continued to chug along and add jobs. God bless America.

In the short-term, we shouldn't expect much. All those Canadian IPOs lining up to launch in the fall? They'll just have to wait and see. All those energy and mining companies looking to pay down debt by raising equity? They'll have to hope this is just a hiccup. For now, everything's off the table; finding market stability is the number one priority.

And that won't be easy. The global financial crisis still looms large in so many peoples' minds – you never really get over a near-collapse like that. As one hedge fund manager told The Globe and Mail in August, 2011, when markets went absolutely wild after the U.S. was downgraded, "People are afraid of being afraid, the way they were in '08 and '09. That left a lot of scar tissue." I've never forgotten those words.

What we need now is for major figures – bank chiefs, central bankers, politicians – to calm everyone down. Never forget the power of pithy statements. European Central Bank chief Mario Draghi all but ended one of the worst bouts of market panic with three words, pledging in 2012 to do "whatever it takes" to save the euro. Investors soon showed they appreciated that there was an adult watching over everything.

Already there are signs such optimism, or long-term thinking, is out there. Asked about their take on the current markets, the Canada Pension Plan Investment Board said volatility can actually be a good thing. "As any investor, we have a bias to stability over uncertainty, yet periods of dislocation can present compelling opportunities that short-term investors are unable to pursue," a spokesperson for the fund told Reuters.