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LONDON — There seem to be two unstoppable trends on the current British scene — the unending rise in the London stock market and the still rising popularity of Tony Blair, the prime minister.

The two are not unconnected. The economic recession which many experts forecast for Britain, after five years of strong growth, is proving to be the mildest of dips and the outlook for renewed expansion without inflation looks rosy. Even the normally austere and cautious Bank of England has joined in the optimistic chorus.

Meanwhile the impression is growing that the worst of the Asian economic turmoil is over, that most, if not all, of the Asian tigers are getting back into their stride and that even the giant but stagnant Japanese economy may at last be getting its act together.

The new strategic view being advanced is that Britain is following the American pattern of sustained growth underpinned by rapid innovation, minimal regulation and low business taxation. It seems that the “Anglo-Saxon” club, which arouses such suspicions elsewhere in Europe, really is pursuing its own path and outperforming almost all the rest of the world economy. Neither the medieval maneuverings in the Kremlin nor the announced retirement of U.S. Treasury Secretary Robert Rubin, have dented this confidence.

All this creates a very positive and comforting feeling among the British, which in turn is reflected in unwavering support for the young and dexterous British Labor leader. After two years in power, when most governments are usually floundering, the Blair administration is still way ahead in the opinion polls, and the official Conservative opposition, led by William Hague, still lags far behind.

There are just two blemishes on this optimistic tableau. The first is that it is not being shared by Britain’s partners in the European Union. the divergence between the bouncy British economy, riding alongside the booming United States, and the sluggish performance of Germany and France is becoming more, and not less, pronounced.

This is awkward because the official British strategy is to get much closer to the rest of Europe. Blair keeps repeating this aim. It is the European, not the American, club that Britain is supposed to be joining.

Yet events are dragging Britain the other way. U.S. trade and investment links with Britain are large and growing larger all the time, while the euro-zone, which the Blair government wants the pound to join in 2002, looks less and less appealing.

This explains why public opinion, as measured by the polls, remains extremely cool about more euro-involvement, and especially about the euro currency itself. Businessmen are strongly divided and a recent survey suggests that two thirds of all paid-up trade-union members in Britain are against joining the euro system.

At this will be put to the test in the forthcoming elections to the European Parliament in June. The Labor government will campaign on its pro-European stance and on Britain’s undoubtedly improved relations with the rest of the EU’s leaders and opinion-formers.

The Conservatives will campaign on the manifest weaknesses in the present European “house,” (not least that the whole of the European Commission is in limbo, having resigned en bloc over fraud and corruption scandals), and the need to put these things right before any further entanglement with European integration is contemplated.

In practice people will probably vote in line with their general attitudes toward the present government, which means either that Labor candidates will get plenty of support or voters will simply stay at home. A massive switch back to the Conservatives is unlikely because the Conservative message, although increasingly in tune with the realities about the stumbling EU, is still not getting through and Blair’s continuing popularity dominates the stage.

The most likely outcome is a very low vote and not much change in the present pattern which gives the Labor party a big majority in the European Parliament.

So what else could change the picture of economic cheer that is proving so favorable to the administration?

The answer brings us to the second potential blemish on the rosy scenario mentioned at the beginning of this article. And this is something that lies outside the control of any British leader, or any other world leader. It is that the Wall Street stock-market bubble could eventually burst, bringing down the entire structure of confidence that sustains U.S. economic growth, which in turn sustains global growth.

That could happen at any moment or it could not happen at all. It depends whether one believes, with many senior and experienced commentators, that booms always go bust sometime or whether one believes, with many other equally well informed observers, that there really is “a new paradigm,” a pattern of unceasing economic growth and investment driven by technology, by plummeting costs, soaring productivity and juicy profit margins.

There is room for schizophrenia here. Wall Street clearly is too high, having reached a “spike” at just about the same level as in 1929, and we all remember what happened after that. On the other hand, technology applied throughout the whole U.S. economy in a totally flexible and liberalized climate, is plainly delivering new standards of performance and prosperity, a flood of new jobs and rising real wages (after decades of falling real incomes).

So a cautious middle view might be that there will indeed be quite a big “correction” in the U.S. stock market but this will not be enough to undermine general economic confidence and momentum. The good times — for the Anglo-Saxon world — will roll on. A Wall Street hiccup, followed by the same pattern in London, could even be interpreted as “a good thing,” just as Blair’s presentational skills interpret every other setback.

Even the fact that much of the rest of the EU is stuck in the doldrums, with huge unemployment and arthritic economies, is depicted by the British leader as a blessing and an opportunity to preach British remedies and improve Britain’s European credentials.

In Voltaire’s “Candide,” currently playing to packed British audiences in a musical version, the tutor to the hapless and disaster-prone Candide is Dr. Pangloss. He teaches that optimism must be applied to everything, and that all is for the best in the best of all possible worlds, whatever happens.

Dr. Pangloss is alive and well and living just at the moment in London. And his chief pupil is Tony Blair.

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