Autos and Normalization
If there has been one consistent source of strength in the US economy it has been automobile manufacturing and sales. However, even that is a bit of a misdirection since the growth in autos since 2009 owe mostly to the depth of contraction in the Great Recession. What looks like rapid growth is really a .. read more
Lack of Ambiguity Across Europe
The recession deepened in Europe, but that was not a surprise to anyone outside the economics profession. While Germany stays perched upon the precipice of another contraction (Q/Q), the rest of Europe was not so “fortunate”. While we can label these gyrations in GDP re-recession, double or triple dip, etc., the truth is that this .. read more
ECB’s ABS Plan Is More Than ‘Bad Bank”
First ECB head Mario Draghi hinted at discussions of an ABS plan at his press conference. Now we get word from Die Welt that not only is it more than a rumor, it has been discussed by the ECB’s governing council. The German paper also notes that it seems likely that the governing council is .. read more
Might Draghi Know Something?
The rumors of the ECB rate cut had become rather ubiquitous in the past few weeks. Confidence in the European economy has been indirectly proportionate to those rumors, particularly as Germany seems to be heading south again after a short-lived reprieve. France is just a downright mess. But the rate cuts that were just announced .. read more
No Bottom In Europe, A New King of the PIIGS
The bounce for Germany seems to be over, and, much like US manufacturing, there appears the mini cycle. Markit PMI for Germany: Both the ZEW Indicator of Economic Sentiment and IFO Business Climate Surveys disappointed expectations, as sentiment in Germany looks to have passed an inflection and rolled over again in sympathy with manufacturing. For .. read more
Europe’s Debtor Prison, Part 2
“According to ABI the value of total loans issued, 1.467 billion euros, represented a 2.5% drop on the December value and was largely the result of the continuing recession in Italy. “Meanwhile, for the current year ABI researchers said their forecasts of a 0.6% contraction in the economy would likely be revised for the worse .. read more
As The Euro Turns (Again)
Financial markets in Europe have been a sea of tranquility since last summer. The ECB and Mario Draghi’s promise for unlimited interventions began another quieting period that suppressed bond spreads that has led to the premature “euro crisis is over” sentiment. During that time, the Greek settlement (or third default) on December 10 seemed to .. read more
Europe Still Ugly, But Ugliness Is Not Just For PIIGS Anymore
Total European roundup from this morning – marginally less bad in the PIIGS, but deterioration into contraction in Germany and especially France. SPAIN, Services PMI 41.2, up from 40.2 “This Further sharp reductions in activity and new orders were recorded in the Spanish service sector during October as the economic crisis in the country persisted. .. read more
