We haven’t talked about Europe in a while in this column, and I think it’s a good idea to pull back the curtain to see what is going on over there. It turns out that the economy is getting worse and not better.
The European Union is in its longest recession on record, now over one and one-half years with no end in sight. Only Germany eked out a tiny amount of growth at 0.1 percent. (http://www.moneynews.com/StreetTalk/Germany-Eurozone-Recession-France/2013/05/15/id/504543)
France’s economy just turned into recession, and the economies for the quarter in Finland, Cyprus, Italy, The Netherlands, Portugal and Greece all shrank, as well. Data last month showed Spain’s economy contracted for a seventh consecutive quarter.
Meanwhile, unemployment is getting ugly. France and Spain are grabbing the headlines there as they are two of the larger EU economies. “According to figures published recently, the number of unemployed workers in Spain and France has reached all-time highs, as Europe’s economic collapse accelerates under the impact of the global economic crisis and austerity measures imposed throughout the continent.
In Spain, the National Statistics Institute (INE) reported that the country had 6,202,700 unemployed workers, the first time in history that over 6 million Spanish workers were jobless. Spain’s unemployment rate rose 1.14 percentage points, to 27.16 percent, as 237,400 jobs were lost. Spanish youth unemployment has reached 57.22 percent.”
Back in France, we learn:
“In France the number of “Category A” job seekers those who had not worked at all in the last month rose to a historic high of 3,224,600. The total number of job seekers registered at the Jobs Pole in France and its overseas departments hit 5 million last month. France’s unemployment rate stands at 10.6 percent, with the youth unemployment rate hitting 25.4 percent at the end of 2012.” The unemployment statistics were found at http://www.globalresearch.ca/europes-economic-crisis-unemployment-hits-record-highs-in-spain-france/5333053. Notice the unemployment figures for the youth unemployment rates; 57.22 percent in Spain and 25.4 percent in France.
This should be of concern to all Americans because Europe’s economy and our economy are intertwined. Just like our issues in 2008 bled over into Europe, eventually their issues today are going to bleed into the US. And needless to say; that will not be good for our markets.
With all this in mind, I have a couple of parting questions for you.
1. Do you believe that these very large groups of unemployed youths have a significant potential for social and political unrest?
2. Do you trust the Europeans to fix all their troubles before they become ours?
3. Can you tell me why we have record highs in our stock markets?
4. How much money did you lose in 2008?
5. Do you know what déjà vu means?
On a brighter note. . . Have a wonderful holiday!