Newsgroup: it.politica.internazionale
Titolo: The European recession of 2011/12

http://ftalphaville.ft.com/blog/2011/09/30/689861/the-european-recession-of-201112/
 
 
The European recession of 2011/12
 
Posted by Neil Hume on Sep 30 10:28.
 
Yup, it really has come to this. Rather than debating if there will be a 
recession in Europe, economists are now trying to figure what it will 
look like and how long it will last.
 
RBS has already given us its view, and now comes JPMorgan.
 
Economist David Mackie says its difficult to have much conviction on 
what the recession will look like. Conditions are unusual (to put 
mildly) and there’s is also uncertainty about policy. Not only in the 
sense of whether policymakers can respond but whether there is scope for 
the addition of further stimulus.
 
Martin Wolf reckons there is (he believes s the time has come to print 
money on a grand scale) but others are less convinced.
 
Anyway, this recession won’t look like the recessions of the 1970′s, 
1980′s and 1990′s, which were driven by a monetary policy shock that hit 
a private sector with overextended levels of spending, says Mackie.
 
It will be more like the 2008/09 recession which also involved a 
monetary policy shock but also a huge asset price shock (housing) and 
the overextension was in the financial sector (banks).
 
"At first blush, the recession that we look to be sliding into now looks 
more like the 2008/09 experience. Instead of a monetary policy shock, 
the region is experiencing a confidence shock – confidence in sovereign 
solvency – which is being amplified by a still vulnerable financial 
system. As asset prices have fallen, bank funding stress has risen 
dramatically, to something more than half way back to the situation 
immediately post-Lehman’s.
 
Although banks have access to unlimited funding from the central bank, 
funding stress does lead to higher retail borrowing rates, tighter 
lending standards and a desire on the part of banks to delever their 
balance sheets. This suggests that the region will experience something 
of a credit crunch in the coming quarters. As we saw in 2008/09, tight 
credit availability can exert a significant toll on the real economy.
However, it won’t be as bad.
 
But, a key difference between now and early 2008 is that levels of 
spending on durable goods and inventory are currently low, and financial 
positions in both the household and corporate sectors are currently 
good. There is still a deleveraging process underway in some of the 
peripheral economies – as households generate free cash flow to reduce 
the size of their balance sheets – but conditions are nothing like as 
stretched as they were at the start of the 2008/09 recession. 
Importantly, the global backdrop looks better now than in 2008/09: what 
we are experiencing at the moment is an asymmetric Euro area shock, 
rather than a common global shock. The differences between now and early 
2008 are the reason why we think the upcoming recession will be relative 
mild."
 
Right, then, relatively mild.
 
"We now expect the Euro area to slide into recession in the fourth 
quarter of this year. The contraction is expected to last through next 
summer and to involve a peak to trough decline in the level of GDP of 
just under 1%. This looks like a pretty mild recession. In the 
recessions of the mid-70s, early-80s and early-90s, the Euro area saw 
peak to trough declines in the level of GDP of 2.5%, 0.5% and 1.9% 
respectively. And in the 2008/09 recession, GDP fell by a staggering 5.5%."
 
But Mackie doesn’t have much confidence in his forecast.
 
He reckons the risk to his projections are on the downside because 
Eurozone policymakers won’t take the necessary steps – leveraging the 
EFSF etc – to contain the sovereign debt crisis until there has been 
another gut wrenching plug in the markets. And that dynamic will impact 
the economy, negatively.
 
"The distinguishing feature of recessions tends to be depth rather than 
duration. The 2008/09 recession was almost three times deeper than the 
early 1990s recession, but it was only one quarter longer in duration. 
This suggests that policy plays a key role in arresting the negative 
dynamic in recessions. But, in contrast to the experience of previous 
recessions, when policymakers were adding stimulus to the economy, the 
policy action that we anticipate in the coming months is more about 
crisis containment. This begs the question of how effective policy will 
be in containing the negative dynamic in the real economy and creating a 
base for the ultimate recovery."
 
The answer is not very.
-- 
Namib
 
"Per realitatem et perfectionem idem intelligo" (Baruch Spinoza)

 britannici.
 
questo invece è un rosicante italico che cita uno yankee
rosicante...su se stesso
http://www.ilgrandebluff.info/2011/09/gli-usa-stanno-entrando-in-recessione.html