Survey: Eurozone economy exceeding expectations… by maybe shrinking at a slower rate

posted at 8:41 pm on June 20, 2013 by Erika Johnsen

Well… it’s a sad after sixth straight months of economic contraction, I suppose a seventh quarter of slightly less of a contraction is something of a relative improvement — “relative” being the key word. Via the WSJ:

The euro-zone economy may finally be exiting its longest postwar recession but entering a period of stagnation or very weak growth at best, latest data suggest. …

In the PMI survey, which data company Markit compiles based on reports by purchasing managers at around 5,000 companies, scores below 50 signal falling business activity. Even June’s improved reading thus points to a slight drop in euro-zone gross domestic product in the second quarter. But the pace of contraction is fading. Euro-zone GDP fell 0.9% in the first quarter, at an annualized rate, its sixth straight drop. …

“We’re in the first stage of a fizzling out of the recession,” with recovery in Germany “trickling down” to France, Italy and Spain, said Andreas Rees, economist at UniCredit in Frankfurt.

But after 18 months or more of steady contraction, whether the bloc’s GDP flattens or even expands a little bit is largely irrelevant for households and businesses, analysts warn: It will still feel like a recession, they say.

Precisely. First of all, I have little-to-zero faith in so-called expert euro-analysts with projections of optimism these days, given how often their ambitious predictions been “unexpectedly” proven spectacularly incorrect; but secondly and more importantly, even if the eurozone economy somehow manages to stop shrinking, a zero or one percent growth rate is going to accomplish approximately nothing in helping Europe to solve their massive employment problems, grow their wealth, increase their tax receipts, and pay off their gigantic debts.

The eurozone’s collective unemployment rate currently stands at above 12 percent — a record high since the formation of the currency union — and it’s widely ‘expected’ to keep on rising at least throughout the year, which in turn is going to push up the public spending in the union’s multiple and expansive entitlement states. It’s a self-defeating and vicious cycle, and it is most definitely not what substantive economic recovery looks like.


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…sounds like the USA!

KOOLAID2 on June 20, 2013 at 8:43 PM

OT…who cares?….FREE the TWERP!

KOOLAID2 on June 20, 2013 at 8:45 PM

…hello?

KOOLAID2 on June 20, 2013 at 8:45 PM

…ok!

KOOLAID2 on June 20, 2013 at 8:46 PM

…no one found this thread…huh?

KOOLAID2 on June 20, 2013 at 8:46 PM

…than I’ll just do a KCB!

KOOLAID2 on June 20, 2013 at 8:47 PM

…who care about the Europeans?

KOOLAID2 on June 20, 2013 at 8:47 PM

…we only care about the Arab countries

KOOLAID2 on June 20, 2013 at 8:48 PM

…is there a European Spring?

KOOLAID2 on June 20, 2013 at 8:48 PM

…oh oh!

KOOLAID2 on June 20, 2013 at 8:49 PM

…Electrongod?

KOOLAID2 on June 20, 2013 at 8:49 PM

…trolls?

KOOLAID2 on June 20, 2013 at 8:49 PM

…I think I got lost!

KOOLAID2 on June 20, 2013 at 8:50 PM

…I’m not even trying…this is not right!

KOOLAID2 on June 20, 2013 at 8:50 PM

…Alt?

KOOLAID2 on June 20, 2013 at 8:51 PM

…Bmore?

KOOLAID2 on June 20, 2013 at 8:51 PM

…trolls?

KOOLAID2 on June 20, 2013 at 8:49 PM

No one wants to converse with you.

RickB on June 20, 2013 at 8:51 PM

Dead kool walking. You should have quit when you were behind.

Bishop on June 20, 2013 at 8:52 PM

…come on!

KOOLAID2 on June 20, 2013 at 8:52 PM

Has liberal4life blamed it on europeans not getting enough vacation time yet?

lorien1973 on June 20, 2013 at 8:52 PM

…I was just going to say BISHOP!
(:->)

KOOLAID2 on June 20, 2013 at 8:52 PM

The Eurozone was doomed to failure even before it started.

The EU, likewise.

Soon, national interests, economic and cultural, will dictate that several key members step out of the EU and the Eurozone.

Otherwise they will end up with a generation or two of productive nations being stifled in order to support those who cannot be or hope to be as productive.

Could a Chad, for example, be considered on par with a Canada?

This idea that if everybody sat down, sang a few verses of Kumbaya, and opened their wallets, ignored the fact that a number of nations came in with full wallets, and a lot more came in with no wallets at all….and they couldn’t decide in which language to sing that beloved anthem.

Add to that the overly aggressive and cumbersome EU regulatory process…and it is a small wonder, no, a near miracle, that collective unemployment in the Eurozone is only 12%.

coldwarrior on June 20, 2013 at 8:53 PM

This idea that if everybody sat down, sang a few verses of Kumbaya, and opened their wallets, ignored the fact that a number of nations came in with full wallets, and a lot more came in with no wallets at all….and they couldn’t decide in which language to sing that beloved anthem.

Add to that the overly aggressive and cumbersome EU regulatory process…and it is a small wonder, no, a near miracle, that collective unemployment in the Eurozone is only 12%.

coldwarrior on June 20, 2013 at 8:53 PM

So you’re saying it’s like going to dinner with Moochelle and then she wants to split the check.

RickB on June 20, 2013 at 8:56 PM

RickB on June 20, 2013 at 8:56 PM

Now, was that called for???

coldwarrior on June 20, 2013 at 8:58 PM

Damn straight, it was. :-)

coldwarrior on June 20, 2013 at 8:59 PM

Obviously they need to increase Muslim immigration to boost their economies.

Charlemagne on June 20, 2013 at 9:00 PM

OK, KOOLAID2…you can have yer thread back. :-)

coldwarrior on June 20, 2013 at 9:00 PM

…no thanks!

KOOLAID2 on June 20, 2013 at 9:06 PM

All that socialism, prime pumping, keynesian economics and they just are stalled out?

They should be in Nirvana by now.

tom daschle concerned on June 20, 2013 at 9:07 PM

Say, isn’t the fear that the one “bright” spot of the pEU, Germany, is tipping toward recession?

Steve Eggleston on June 20, 2013 at 9:08 PM

Lol!

Bmore on June 20, 2013 at 9:11 PM

Steve Eggleston on June 20, 2013 at 9:08 PM

Germans react badly when hit with recession…

coldwarrior on June 20, 2013 at 9:11 PM

Greece is back with the likelihood of new elections, given the breakdown the the ruling coaltion.

And Free the Twerp.

65droptop on June 20, 2013 at 9:27 PM

I’v got a bag of marks, kroner, shillings, guilders, nfranks. They ain’t worth anything now, but should I hang on to them? That picture euro coins reminded me of them. I also have pounds, yen, rials, Lyra,and even a maria thresa or two. The MTs, pounds and yens are probably the only ones that have a current value.

And just to remind everybody wher we in the US are heading, I have a 10 million RM note. I understand that, at the time, would buy a berliner (jelly doughnut) or chocolate napoleon.

Old Country Boy on June 20, 2013 at 9:49 PM

Germans react badly when hit with recession…

coldwarrior on June 20, 2013 at 9:11 PM

I can almost smell history repeating itself, and I ain’t smelling a patch of daisies either.

MelonCollie on June 20, 2013 at 10:10 PM

MelonCollie on June 20, 2013 at 10:10 PM

When ThyssenKrupp AG stops producing construction equipment and starts up their cannon and armored vehicle line…don’t plan any European vacations.

coldwarrior on June 20, 2013 at 10:15 PM

When ThyssenKrupp AG stops producing construction equipment and starts up their cannon and armored vehicle line…don’t plan any European vacations.

coldwarrior on June 20, 2013 at 10:15 PM

Vacation heck, if they leave off the genocide obsession this time I’ll be bloody tempted to join them. There’s going to have to be some emphasis on cultural purity, however, if they don’t want to win Europe just to get overrun by Islam.

My nation has the most might on the planet both in terms of public-sponsored military and privately-owned arms. Right now they are used about as much as a mountain bike in an aquarium.

MelonCollie on June 20, 2013 at 10:21 PM

BTW, Germany has well over 400 Leopard tanks…and that is over 400 more tanks than we currently have in Germany. [We have zero. The last one was pulled out this spring. First time since 1945, no American armor in Germany.]

Massive reorganization and modernization of the Bundeswehr is going on presently.

Thank goodness they get along well with their neighbors…for now.

:-)

coldwarrior on June 20, 2013 at 10:21 PM

BTW, Germany has well over 400 Leopard tanks…and that is over 400 more tanks than we currently have in Germany. [We have zero. The last one was pulled out this spring. First time since 1945, no American armor in Germany.]

0_0

So then besides Russia (who I think they’ve learned to leave alone), is there any European armor force who could seriously challenge them?

Massive reorganization and modernization of the Bundeswehr is going on presently.

coldwarrior on June 20, 2013 at 10:21 PM

I don’t claim to be a prophet…but…wow.

MelonCollie on June 20, 2013 at 10:30 PM

MelonCollie on June 20, 2013 at 10:30 PM

, is there any European armor force who could seriously challenge them?

Other than Russia? No.

coldwarrior on June 20, 2013 at 10:39 PM

When I was in Germany an OLD timer sat down on a bench next to me with a pouch. Probably WWI era. Pulled out a chunk of bread and a knife about a foot long and said “ya?”

We broke bread. Just nodded at each other. Smiled.

He knew the cycle repeats. He’s eyes told the story.

What say you Twerp? Speak up.

You can’t?

You should be able to. Email to Ed,,, ignored apparently.

wolly4321 on June 20, 2013 at 10:43 PM

Other than Russia? No.

coldwarrior on June 20, 2013 at 10:39 PM

God Almighty. Same song, third verse.

…dare I ask the state of their air force?

MelonCollie on June 20, 2013 at 10:44 PM

Survey: Eurozone economy exceeding expectations… by maybe shrinking at a slower rate

Also, golfball-sized hailstones hitting your vehicle are preferable to softball-sized ones.

Dr. ZhivBlago on June 20, 2013 at 10:51 PM

MelonCollie on June 20, 2013 at 10:44 PM

Germany?

Quite good…and improving. [Just an observation...]

Germany is not going to start anything…but they certainly realize they are on their own, NATO or not, as a number of NATO countries have opted to severely trim down their forces…Canada being an exception, and they are trying to modernize or update as much as their budget will allow. As a result, Germany takes their defense a lot more seriously than most. The US Seventh Army, for example, is presently no more than a reinforced brigade, mostly admin and commo. We’ve a light brigade or two, one at Graf. Almost all the rest are long long gone. Cold war being over and all.

Why is this important?

Our mission in Europe since 1945 was a lot more than simply trying to keep the Russians out. From 1945 to 2013 is the longest period of peace in Europe…despite the whole Kosovo/Serbia thing, and the once in a while perimeter stuff, Turkey-Greece, and such. Our presence enabled Europeans to concentrate on matters other than conquest or neighborhood warfare.

Most Europeans presently understand this. A growing economy, good jobs, good pay, good benefits…all good.

If the economy goes all Greek on the major players, Germany, for example…then all bets are off. And there is really no on-the-ground umpire to intervene and keep the parties focused.

But, more likely, is Russia…first pressuring the Ukraine, then the Baltics, then Poland…little things…like no anti-missile radars…or no training with US forces…until there is a fracturing of NATO as each member, especially those with a lot of skin in the game (proximity to Russia/self-survival) decide that the guy next door is not worth dying for.

Germany understands this well. Will Germans be willing to die for Turks? Or Lets or Estonians? For Germans? Sure…in a heartbeat, for most of the Germans. Not a lot of Turks, Greeks, Portuguese or anyone else with a lot of moxie to take one for Berlin.

Hence the modernization and reorganization of the German armed forces. Their being in Afghanistan is less about helping Karzai, and a lot more about giving them real-live training.

coldwarrior on June 20, 2013 at 11:08 PM

For Germans? Sure…in a heartbeat, for most of the Germans.

Really bolixed that up. Germans will be willing to die for Germans…but not for the rest. And most Germans, other than the dyed-in-the-wool pacifists, will be willing to do so. Nationalism is still deep amongst them. Not like here, where nationalism is considered a crime by the ruling party.

coldwarrior on June 20, 2013 at 11:27 PM

MelonCollie on June 20, 2013 at 10:30 PM

, is there any European armor force who could seriously challenge them?

Other than Russia? No.

coldwarrior on June 20, 2013 at 10:39 PM

Actually, yes. Sort of.

Poland now has nearly as many tanks as Germany. They’re Leo 2s they bought from Germany. They’ve also bought a bunch of the Panzerhaubitze 2000 SPG 155s, the 800kg gorillas of that breed.

While they’ve been buying F-16s from us.

As for the Luftwaffe, they’ve been re-equipping with the Typhoon at a fast clip, but unlike the other AFs fielding it (Italy, etc.) they’re not paying off their Tornados. Those are going back through refit and coming out with new avionics and engines, plus some structural rebuilds (composites in new places, etc.).

BTW, the old Bundesgrenschutz (border guards) have been completely reorganized into the Bundespolizei. And the old GSG-9 CTW unit is now the much bigger and nastier Deutsches Kommando Spezialkrafte (KSK), which also handles riot duty throughout Germany. Think CENTCOM minus any posse comitatus restrictions, and you’ve got the general idea.

I’m getting that old feeling again, and it’s feeling a lot like the Thirties. The difference is, this time I don’t think Germany’s going to start anything, but I’m pretty sure that they expect somebody else to, and they, and Poland, working together, are intending to finish it.

clear ether

eon

eon on June 20, 2013 at 11:29 PM

eon on June 20, 2013 at 11:29 PM

Excellent points on Poland. Didn’t include them as they are still a bit behind the curve, but among Euro forces, yes, they are in the best state they have ever been in in the past century or so. But, Russia is leaning hard…very hard…still. The unexplained decapitation of Poland’s leadership at Smolensk in 2008 cost Poland a lot more than most understand. Not just a President, but effective talented leadership.

coldwarrior on June 20, 2013 at 11:35 PM

Our mission in Europe since 1945 was a lot more than simply trying to keep the Russians out. From 1945 to 2013 is the longest period of peace in Europe…despite the whole Kosovo/Serbia thing, and the once in a while perimeter stuff, Turkey-Greece, and such. Our presence enabled Europeans to concentrate on matters other than conquest or neighborhood warfare.

Most Europeans presently understand this. A growing economy, good jobs, good pay, good benefits…all good.

Mostly, I think you’re right, but I don’t think that’s all of it.

The Socialists completed their takeover of Europe as a result of World War II. I guess the big question that war solved was what brand of Socialism would predominate. We obviously wanted the kind we ended up with…which interestingly made Moscow quite happy. Hmmm.

And what is there to fight over? Some really good seaports? Lebensraum? What? They’ve been depleting resources on that continent for thousands of years. Even when Nazi Germany controlled all of Central Europe they still never had the resources we did. And as with the Confederacy, that’s what did them in-lack of resources. One side doesn’t win because they’re “better” or somehow more Holy than the other side. It comes down to who can afford to lose a lot of stuff and more easily replace it.

If you or I were modern Visigoths I would imagine that next to Antarctica, Europe is the last place we’d look to invade in order to accumulate wealth and power. The valuable resources are everywhere else-South America, Africa, Asia, and North America.

What Europe does have going for it is that it indeed does control much of the world’s resources (elsewhere), centers of high finance/banking, and technological know-how. You don’t take control of that with tanks. The means of invasion are, shall we say, more subtle?

Dr. ZhivBlago on June 20, 2013 at 11:47 PM

Dr. ZhivBlago on June 20, 2013 at 11:47 PM

Resource poor, certainly.

But, even today, there are bits of land, or causes, or ideologies, that under the right conditions could make for an outburst of militancy or two. Cyprus or the Aegean islands, the Balkans, still, and others. If the Euro economy tanks, and each Euro partner decides taking care of one’s self is far more important than pseudo-Euro unity, I wouldn’t put use of armed forces out of the question, though a hell of a lot less likely these days than in 1939.

Cyber war leading to IRL warfare is of concern. We face the same, by the way.

No, I do not see columns of armed soldiers, singing the Horst Wessel Lied marching off to punish the Czechs, or Freench, but I do see the possibility of SpecWar forces acting to prevent intrusion, invasion, or other threats should a polite diplomacy and a stern letter or demarche fail.

I also see a growing possibility of a non-Euro nation rattling sabers…Iran, for example, using proxies already deeply imbedded in Euro society making things untenable for public safety or good order, or fomenting riots or massive civil disorder. Look to France a couple years back, and today, for that matter, where entire neighborhoods, a few towns, are no longer safe for the native inhabitants.

Wars for natural resources in Europe ended a generation or so ago.

Was for economic survival?

More likely.

coldwarrior on June 21, 2013 at 12:21 AM

coldwarrior on June 21, 2013 at 12:21 AM

Thank you for your insights. What you say sounds very logical to me.

Dr. ZhivBlago on June 21, 2013 at 1:47 AM