Europe is wrong but Va Bien

Europe is bad, but goes well July 31, 2009 The remainder of 2009 is still an economic downturn and rising unemployment in the eurozone. The positive signs begin to see in 2010 and everything suggests that the growth will appear in slow motion. Will it be possible to accelerate the recovery of the economy there? The International Monetary Fund (IMF) has not been too optimistic about the outlook for the eurozone economy by 2010. The Digital Today site realized that the world body expects the region to experience a slow recovery in 2010 and surrounded by uncertainty. Bet of the body is designed to reach only 0.3% growth. The fears raised by the IMF leave the impression that the mere fact that the economy grows is good news, and should conform. But 0.3% is a number too modest to delude the great mass of unemployed now available to the eurozone, with the possibility of employment. I think mainly in the more than 3.1 million young people under 25 years unemployed (the segment of the population hardest hit by the crisis), available to the region.

The poor economy with a 0.3% growth in that scenario would not have too much capacity to create jobs, not even necessary to absorb new entrants into the labor market. The setting for the remainder of 2009 is not too optimistic as presented, with an IMF anticipating a 4.8% contraction of GDP in the region (although the European Commission, are not so pessimistic and expected to expected to shrink 4%). For businesses, there remains the risk of deflation also affects their profit margins. During the month of June, according to Eurostat, the euro exhibited his first year price deflation (which was 0.1%) since the euro was introduced. The logic of the entrepreneur who sees an economy that is contracting and that their margins shrink further lower product prices, tends to consider that this is not a year to invest, or if there is the possibility of doing so, better to opt for alternative short-term. With this comprehensive way of thinking of European entrepreneurs, it creates a vicious circle that deepens the economic downturn in the eurozone.

"We are wrong, but so good? (Carlos Saul Menem, during his presidency in Argentina, 1990). This statement clearly reflects the state of the economy of the eurozone. In this sense, an encouraging sign for the industry was, as he realized a week ago Expansion, in the month of May recorded its first monthly increase since August 2008, beyond the industry-on-year contraction observed a 17% during that month. The growth in the month is a sign that increases the hope of recovering industry euro area. Industrial production accounts for about 17% of GDP in the Eurozone and therein lies its importance in terms of out of recession. The way out of this recession and industry recovery in the eurozone, is highly dependent on what happens in the U.S. economy. Families and European companies are not too strengthened to boost domestic demand and thus economic growth. And on the side of the U.S. economy, the prospects for recovery improve apace. The improvement in the U.S. economy and signs of moderating the crisis in the eurozone, are improving the mood of families and businesses.

So despite the bad omens about economic growth for the region provided by the IMF in July for the fourth consecutive month, came back up economic confidence by consumers and businesses. The economic sentiment index rose in July to 76 points, compared to 73.2 points the previous month. Analysts polled by Dow Jones Newswires had forecast a more modest rise to 75.3 points. If positive mood improvement in the private sector in the region, the greater is the change in expectations in Germany. The improvement in economic conditions there, the eurozone's largest economy and engine of the region is reflected in strong growth IFO index of business confidence and purchasing managers' indices show a clear recovery in growth prospects for the first economy of the eurozone. These high expectations help to twist the decisions of households and businesses, but more still needs to be reflected in improvements in economic data. A key element of great importance to underpin the economic recovery through the financial system.

In this sense, there is still a strong decision of both firms and households as banks begin to recover from the credit market from both sides. In fact, the European Central Bank (ECB) has just reported a few days ago that the growth of bank lending to businesses and households in the euro area in June fell to its lowest level since 1992, with a poor growth of only 1.5% yoy. "We are bad but so good? could repeat the ECB. This is because good news on Wednesday gave The Economist reporting that the expected Eurozone banks to relax credit conditions for businesses and households in the third quarter. This development arises from the survey that the European Central Bank (ECB) conducted among 118 banks in the region. The conditions of European banks in terms of their access to funding and liquidity position are helping to change the willingness of banks to lend. The generation of funding for the economy and the recovery of external demand (mainly from the U.S. and China) are the key elements to the end of the recession and the beginning of economic growth in the eurozone.

Not so much what you can do the European governments and the ECB as that may affect these two elements, explain the force with which the economic recovery will occur. Yet there are great expectations for 2010, but we were surprised and depth of the recession, we would have to miss a stronger recovery in the eurozone. Independent Investment Horacio Pozzo History will show that the Fed helped avert a Great Depression in 2008, but it took radical steps along the way make it more vulnerable politically than it has been in decades. During its 96 year history, the U.S. Federal Reserve (Fed) has gone through a handful of times transformación.El now is one of them, this is the time that individual investors should use to achieve financial independence. Paola Pecora tells investment options here more than 4000 American are already taking advantage. Stop wasting time and learn to invest and become a PREMIUM investor now.