Mish's Global Economic Trend Analysis |
Expect What the Economists Don't Posted: 17 Jul 2013 12:47 PM PDT EU officials and economists believe that Europe can export its way to health. It cannot. As a whole, the 17 nation block runs a net trade surplus. With China slowing, with emerging markets looking anemic at best, and with a weak Japanese Yen making Japanese exports such as cars relatively attractive, precisely where are those exports supposed to go? Mars? Yesterday came the unsurprising news (to Mish readers) that Euro-Zone Exports Slump in May. The European Union's statistics agency Eurostat said Tuesday that adjusted for seasonal factors, exports from the euro zone to the rest of the world fell 2.3% from April, while imports were down 2.2%.EU Trade Year-Over-Year Compared to a year ago exports are up slightly, but I do not expect that situation to last. The slowdown in exports from Germany will put the kibosh on that silly idea. Recovery? What Recovery? Curiously "Economists at Barclays Bank said they believe the euro-zone economy grew very slightly in the second quarter and predicted a gradual recovery for the rest of the year and next. But they stressed that their forecast depends on a moderately supportive market for the currency area's exports. Should exports stall or fall, the recovery could be delayed and weaker than expected." Expect What the Economists Don't For starters there is no recovery. Secondly, there is every reason for eurozone exports to slump; there is no reason to believe hiring will pick up, and no reason for imports or internal demand to pick up in the absence of hiring. So ... Expect the recovery to be "weaker than expected". Indeed, expect no recovery at all. Rather, expect Germany to contribute in a major way to the pending "unexpected" non-recovery, unless by some miracle European exports to Mars suddenly take off. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com |
Greece Bans Protests During Schäuble Visit; Country Needs Another €10 Billion; Expect More Haircuts Posted: 17 Jul 2013 10:42 AM PDT The Greek economy is in total shambles. Unemployment is 26.9% and youth unemployment is 57.5%. Round after round of bond haircuts have not done a thing for the economy. Der Spiegel now reports Greece on the Brink: Athens May Need 10 Billion More According to a report by German daily Süddeutsche Zeitung, the beleaguered country needs another massive influx of money if it is to avoid insolvency. The paper cites an unnamed official at the European Commission as saying that the "financial gap" could be as large as €10 billion.€10 Billion is an enormous sum of money for Greece, and Schäuble is hardly going to deliver any good news. During the visit, Greece elected to put up a facade. Greece Bans Protests During Schäuble Visit The AP reports Greece Bans Protests During Schäuble Visit The Greek police has banned public protests in central Athens for 11 hours on Thursday, when German Finance Minister Wolfgang Schaeuble will visit, a decision the left-wing opposition party described as "fascist and undemocratic."Various Protests in Spite of Ban How successful was the ban? The Guardian provides pictures and a list of various Greek protests of the day On Monday night, teachers and education workers protested against layoffs and school closures, ahead of today's general strike. How long before major violence erupts again? Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com |
You are subscribed to email updates from Mish's Global Economic Trend Analysis To stop receiving these emails, you may unsubscribe now. | Email delivery powered by Google |
Google Inc., 20 West Kinzie, Chicago IL USA 60610 |
Facebook Twitter | More Ways to Engage