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Europe Is On Strike As Its Economy Continues To Implode, Stock Futures At Highs

Tyler Durden's picture


If May Day is when Europe celebrates labor and jobs (if any), November 14 is its opposite, bizarro cousin as today Europe wakes up to a dead(er than usual) economy. The reason: virtually every European country is on strike. From BusinessWeek: "Spanish workers staged a second general strike this year as unions across Europe prepared the biggest coordinated protests yet against budget cuts that policy makers say are needed to end the region’s debt crisis. In Spain, unions said most auto and metal workers joined the strike, even as power demand was just 13 percent below usual. One of Portugal’s two biggest labor groups also called a strike, partial walkouts are planned in Greece and Italy, and French unions are urging workers to join protest marches. “This is a strike against the suicidal economic policies of the government,” Ignacio Fernandez Toxo, head of Spain’s CCOO union, told supporters late yesterday." In other words, Europe's economy which is already doing swimmingly, is about to see 1/60th of its Q4 GDP removed as virtually no economic goods or services are produced today.

And speaking of "swimmingly", the Greek economy shrank 7.2% in the third quarter from a year earlier, the Greek statistics authority said on Wednesday in its first estimate for the period. The authority said Greece, in its fifth year of recession, contracted further than the 6.3 percent 12-month recession posted for the second quarter of 2012. In other words, the economic contraction accelerated in the quarter ended September 30.

Elsewhere, "Euro-area industrial production dropped the most in more than three years in September, led by double-digit declines in Portugal and Ireland. Output in the 17-nation euro area fell 2.5 percent from August, when it increased 0.9 percent, the European Union’s statistics office in Luxembourg said today. Economists had projected a drop of 2 percent, according to the median of 35 estimates in a Bloomberg News survey. From a year earlier, September output slumped 2.3 percent. European companies are struggling to maintain sales and earnings as the euro-area economy weakens under pressure from the fiscal crisis and faltering global growth." In other words, the whole world is slowly grinding to an economic halt, and people in the socialist continent celebrate by striking, coming soon to an America near you.

In other news, the IMF said that it wants a "real fix, not a quick fix’ in Greece. "Speaking during a visit to Malaysia, Lagarde said that all of Greece's partners shared the same goal of putting the country's recovery programme back on track. "All partners share the same objectives and the same concerns, in other words (that) Greece is ... returned to economic stability, can reaccess markets as soon as possible," Lagarde told reporters. "Obviously from the IMF's perspective, we expect a real fix, not a quick fix, and that means clearly debt that is sustainable as quickly as possible." So... what the IMF has been doing in Greecefor the past 3 years, that was a "real fix"?

Concluding today's bad news rout from Europe was the UK, where jobless claims rose more than expected as the labor market slowed, the BoE cut the UK outlook and warned of a risk of "persistent low growth", and Germany auctioned off its first negative yield bond since July.

All in all, one can see why equity futures are on fire.


The full recap from Deutsche Bank

One week on from the US Presidential election result, and we’re no closer to a solution on the fiscal cliff with 48 days left in the year. According to White House Press Secretary Jay Carney, Obama will begin budget negotiations by calling for $1.6trn in additional tax revenue over the next decade, double the $800 billion discussed in talks with GOP leaders during the summer of 2011 (which ultimately fell apart). The seemingly hardline approach sets the scene for tough negotiations with congressional leaders on Friday. The President has called a press conference today where he is likely to provide more detail on the aforementioned tax revenue increases which are reported to include raising taxes on corporations and allowing tax cuts to expire for top income earners (Washington Post, WSJ).

In terms of the markets, a late sell-off in US equities led by technology stocks (-0.90%) marked an otherwise quiet day. The S&P500 closed -0.4% lower, after shedding 0.65% in the final hour of the session. This took us to the lowest level since August 2nd. President Obama’s tweet, in the final hour of trading, that "I'm committed to solving our fiscal challenges. But I refuse to accept any approach that isn't balanced” didn’t help markets hoping for a more conciliatory tone, but probably summed up the state of play of negotiations thus far. US 10yr treasury yields closed at 1.594%, slipping back below the 1.60% mark, and threatening to break out of the 1.6% to 1.8% trading range that has held since August.

Ahead of today’s FOMC minutes, Fed vice-chair Janet Yellen commented that the Fed is considering tying Fed policy to inflation and unemployment targets. Yellen added that the Fed has a target jobless rate range of 5.2% to 6% and that employment targeting may mean that the Fed will tolerate a temporary deviation from inflation ranges. If such a policy comes to pass this is quite a big deal and would need even more money creation.

Asian markets are relatively mixed overnight with gains seen on the Hang Seng (+0.85%) and Nikkei (+0.2%) but the Shanghai Composite (-0.25%) and KOSPI (--0.1%) are underperforming. China’s current President Hu Jintao declared the 18th national party congress officially over today. All eyes are on the final makeup of the Politburo Standing Committee, the highest decision making body of the Party, which will be unveiled tomorrow. Markets are hoping for a substantial representation of reform-minded members. The latest power data in China showed electricity consumption rising 6.1% yoy in October, up from September’s low of 2.9%yoy, providing incremental confidence to some on the trajectory of the Chinese economy. The benchmark Asian IG credit index is trading flat while the Australian dollar is trading marginally higher (0.1%) against the greenback.

Over in Europe, the Stoxx600 closed 0.79% higher led by gains in the peripheries (IBEX +1.66%, MIB +1.4%). Most of the gains came late in the session on the latest Greek headlines suggesting that the troika is bundling the next 3 disbursements for Greece into one payment (totalling more than EUR44bn). However investors were (once again) disappointed later in the US session as German FM Schauble and Greek PM Samaras both said the idea was only being discussed at this stage.

Schauble added that while it was “logical” to combine disbursements, control mechanisms were needed to ensure that Greece keeps to reforms. 10-year Spanish bond yields rose 7.5bp at one point yesterday (to just under 6%) before rallying to close 4bp lower at 5.85%, helped by a re-run of reports that a Spanish bailout is imminent.

Turning to the day ahead, the main focus will be on the FOMC minutes which may provide more detail on policy options following the end of Operation Twist next month. We may also get more detail on Yellen’s inflation/employment targeting plans. In terms of data, US  retail sales and the BoE’s inflation report are the main economic releases. Reuters is reporting that Spanish, Portuguese, Greek and Italian unions have planned a coordinated “European Day of Action and Solidarity”, with strikes against austerity policies. Obama’s press conference is scheduled for 1:30pm US EST today, after which the president will meet with a number of business leaders to discuss his budget proposals.

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Wed, 11/14/2012 - 08:17 | 2979192 GetZeeGold
GetZeeGold's picture



Forcast calls for hard rain.


Wed, 11/14/2012 - 08:21 | 2979213 GetZeeGold
GetZeeGold's picture



Don't really know what to do now that you've won......do you?

Wed, 11/14/2012 - 09:08 | 2979307 French Frog
French Frog's picture

"Europe's economy which is already doing swimmingly, is about to see 1/60th of its Q4 GDP removed as virtually no economic goods or services are produced today."

Well, I reckon they will work twice as hard tomorrow to make up the shortfall lol

Thu, 11/15/2012 - 05:46 | 2983342 JohnF
JohnF's picture

Well, given that the Germans, Austrians and other folks who are actually productive weren't on strike, and the fact that those out on the street are unemployed and not terribly productive to begin with, the effect will be minimal, if even noticeable...

Wed, 11/14/2012 - 09:26 | 2979351 Atlasshruggedme
Atlasshruggedme's picture

I am fat... So I am going to eat until I am skinny. --- People are funny.

Wed, 11/14/2012 - 10:27 | 2979541 Urban Redneck
Urban Redneck's picture

the (suicide) March of the Lemmings continues

Wed, 11/14/2012 - 08:16 | 2979198 bank guy in Brussels
bank guy in Brussels's picture

It is what we do here, strike, general strike, and occasionally riot, as our political 'democracy'.

It is how we change the system and bring down governments.

We Europeans are intrinsically less afraid of police, lawyers, and government ... it is much less repressive here, very hard to go to jail, in general ... so we feel our democracy as a group affair ... Democracy is the general strike and street demonstration and potential riot, as much as 'voting'

We are not so separated by cars, highways and great distances ... Word of mouth on the street trams and buses, and we can have a street brawl going pretty quickly ...

1789 and storm the Bastille ... we never forgot

Wed, 11/14/2012 - 08:28 | 2979229 fonzannoon
fonzannoon's picture

Go Get em Bank Guy!

I never thought I would ever say that ever.

Wed, 11/14/2012 - 08:58 | 2979291 Lost My Shorts
Lost My Shorts's picture

Europeans are eccentric in other ways too.

I am currently in Japan (not bedding secret agents or meeting the prime minister; just here doing nothing too exciting) and often on ZeroHedge or CNBC websites I see an ad for Finnair, promoting flights to Europe.  Whenever I click on it (been the same for weeks), it goes to a 404 page not found error.  So Finnair is paying for clicks to a non-existent page, and can't even figure that out.  And these are the "smart" Europeans.  Oh well, makes a lot of money for ZeroHedge.

Wed, 11/14/2012 - 09:14 | 2979326 French Frog
French Frog's picture

The Finnish government still owns nearly 60% of Finnair ... since when has anything that's owned or part-owned by any government ever been cost efficient, competitive or even simply up to date? 

Wed, 11/14/2012 - 08:29 | 2979233 blabam
blabam's picture

Yeah just pay 75% in taxes and call it less repressive. 

Wed, 11/14/2012 - 08:36 | 2979248 Acet
Acet's picture

I'd like to point out that the UK is the exception to this rule.

In here people get arrested for posting photos of burning poppies in Tweeter or posting bad taste jokes about dead girls in Facebook (the later was already convicted to a suspended jail sentence).

Wed, 11/14/2012 - 08:51 | 2979280 Abraxas
Abraxas's picture

How would you like this guy if this was your daughter?

Wed, 11/14/2012 - 13:11 | 2980269 Overfed
Overfed's picture

Are you fuckin' serious?

Wed, 11/14/2012 - 13:23 | 2980345 Matt
Matt's picture

so, you think people should go to jail everytime they say something that offends someone? And who is going to pay for that?

Wed, 11/14/2012 - 08:52 | 2979283 TeamDepends
TeamDepends's picture

In here?  Sounds like a prison.  Oh wait...

Wed, 11/14/2012 - 09:11 | 2979316 PY-129-20
PY-129-20's picture

No, in Britain you get arrested 18 hours for defending your property against burglars and meanwhile defend the human rights of a djihadist that wants to destroy your society. Not that Germany is much better.

Haven't seen a real strike in years here in Germany. And it won't happen. We're too comfortable, too ignorant and too busy.  Meanwhile small business are dying right and left, but everything is fine. Mutti is doing good work - at least according to the polls. And Berlin is the greatest city in the world.  *sigh*

Wed, 11/14/2012 - 10:00 | 2979449 Vince Clortho
Vince Clortho's picture

If the polls say so, it must be true.

Otherwise, I would be concerned that she has sold out the German people to secure her seat at the table with the elites.

Wed, 11/14/2012 - 10:18 | 2979515 disabledvet
disabledvet's picture

Count me in Banker Guy!

Wed, 11/14/2012 - 08:17 | 2979200 plaspotje
plaspotje's picture

and yet that euro is on the rise ,,, makes one wonder is this government driven or true market driven FX  

Wed, 11/14/2012 - 08:20 | 2979208 GetZeeGold
GetZeeGold's picture



and yet that euro is on the rise


Against what?

Wed, 11/14/2012 - 08:22 | 2979219 cossack55
cossack55's picture

Zimbabwe dollars.

Wed, 11/14/2012 - 08:22 | 2979220 plaspotje
plaspotje's picture

that pain in the ass greenback


Wed, 11/14/2012 - 08:25 | 2979226 plaspotje
plaspotje's picture

and all the peg's that the dollar has like the hkd and rmb

Wed, 11/14/2012 - 08:19 | 2979207 Miramanee
Miramanee's picture

Blah blah blah implosion blah blah blah Greece blah blah blah PIIGS.....OK, how many of you out here in ZH land vote for austerity and the eliminatin of central banking as we know it? Raise your hands....now point your hands forward....now salute: YOU are the ones who are voting for the rise of such groups as the Golden Dawn. AND....you like it. The rage and struggle are exciting: dopamine my friends. You are addicts....addicted to doom.

Wed, 11/14/2012 - 08:24 | 2979225 cossack55
cossack55's picture

More accurately addicted to reality. Go watch some Faux News and you will feel better.

Wed, 11/14/2012 - 08:27 | 2979228 GetZeeGold
GetZeeGold's picture



All my propaganda comes from the Wall Street Journal and CNBC.....thank you very much.

Wed, 11/14/2012 - 08:36 | 2979251 Miramanee
Miramanee's picture

Propaganda is not the issue - brain science is. OF COURSE governments lie, and the MSM lie...the media's job is not to report the news, it is to get you hooked on their dope. Glenn Beck is a GENIUS at this. He speaks in ways, and presents whatever he presents in ways that suck people in...they get hooked...the anger that he creates, and the subsequent "acknowledgement" that he expresses, the "sympathy" that he expresses, simply put gives his listerers and followers a dopamine rush. That's it. It has virtually nothing to do with "the truth." But you folks on ZH and other such doom websites are no different than the government officlals who you condemn, or the MSM that you excoriate. No different....it's just to get high, man.

Wed, 11/14/2012 - 08:38 | 2979255 GetZeeGold
GetZeeGold's picture



Well......guess we're screwed then.

Wed, 11/14/2012 - 09:43 | 2979404 LongSoupLine
LongSoupLine's picture

Your grade as a troll...



Please take the time to enroll in a few of Million Dollar Bonuses "How to troll and still feel good about yourself" classes.  Enrollment can be found through the Apollo/Obama Educational network.

Wed, 11/14/2012 - 09:52 | 2979429 Miramanee
Miramanee's picture

You just don't get it. I underatand. You have been brainwashed. NOT by ideology. I tend to AGREE with most of the analyses here on ZH with regard to underlying issues, etc. Did you hear that? I concur. Yes, malfeasance and fraud and plutocracy et al. You have been brainwashed by the rush of dopamine and adrenalin and endorphins that you get when you and your pals here on ZH gang-up on outsiders - outsiders who express a differing viewpoint. THAT is the definition of extremism. Extremism hides behind ideology, but is really just a neuro-chemical imperative. It is so ironic: you people are the very mouth-breathers you purport NOT to be and that you abhor.

Wed, 11/14/2012 - 13:29 | 2980387 Matt
Matt's picture

"If you spend less than you make, you are a nazi" - paraphrasing Miramanee.

Wed, 11/14/2012 - 13:34 | 2980424 Miramanee
Miramanee's picture


Wed, 11/14/2012 - 08:28 | 2979231 Miramanee
Miramanee's picture

I know the numbers. I have crunched the data. YES.... Eurpoe is not in good shape. So....is austerity the answer? To you people it IS because you'd rather sit at your computers and masturbate while the riots rage than admit that cnetral banking and fiat currency could, in the near term, save the day (while leaders subsequently figured out a way to EITHER grow the EU or dissolve the EU.)

Wed, 11/14/2012 - 08:40 | 2979261 The Master
The Master's picture

Good morning To the Kruuuuugman!

Wed, 11/14/2012 - 08:46 | 2979263 GetZeeGold
GetZeeGold's picture



Heh heh. Where's Robin Williams when you need him?


What you're about to hear is almost going to sound almost sane......almost.

Wed, 11/14/2012 - 08:46 | 2979270 Miramanee
Miramanee's picture

:) Reminded me to "The Ben Bernank"

Wed, 11/14/2012 - 08:55 | 2979286 blabam
blabam's picture

Default ain't austerity numbnuts. 

Wed, 11/14/2012 - 10:04 | 2979471 Vince Clortho
Vince Clortho's picture

Give the drowning man another glass of water.

Wed, 11/14/2012 - 11:46 | 2979847 augustus caesar
augustus caesar's picture

@ Miramanee


You are the definition of a coward looking for the easy way out.

Wed, 11/14/2012 - 12:45 | 2980152 Miramanee
Miramanee's picture

@ caesar

You are the definition of....well....nothing really. I am simply making a point. We are the product of our genetic construction and our brain chemistry. The overwhelming majority of people on ZH refuse to engage in dialog about issues because (a) challenges to their way of thinking threatens their identity, and (b) it is through their identity that their brain chemistry is altered. Think about it. Everytime someone from the MSM makes a gogent point against collapse, or anytime the markets rise or the BLS reports are encouraging, doomers' sense of community and identity is threatenend...hence the immediate denials and rebuttals. It is community that provides the dopamine rush. How many times do you check and recheck your comments? How do you FEEL when people agree with you? Just sayin'.

Wed, 11/14/2012 - 13:01 | 2980223 Miramanee
Miramanee's picture

one more observation - much of what is written about on these pages I AGREE with...from a purely analytical perspective, there is much truth typed into this virtual reality. But hyperbole is also a central theme here...and on other gloom and doom blogs. Hyperbole feeds the brain's desire for dope. Why is it that televangelisis - CLEARLY charlatans and thieves, for the most part - remain so poopular?!! Fire and brimstone gets the juices....errr, the neuro-chemicals....flowing. During the height of my life as a doomer-blogger, I had quite a following. It felt great. It filled a void. BUT, reality conflicted with my opining....so, instead of challenging my reality, I found a community who simply reflected my anger without ever challenging my analyses. THAT is ZH. Anytime someone even puts forth the NOTION that central banking could help stave off austerity, depression, war, etc., that person is eviscerated. And I would argue NOT because he or she might make valid arguments, but because the threat to the community identity is too risky....I think doomers are drug addicts; they're just addicted to dopamine rather than heroin.

Wed, 11/14/2012 - 15:04 | 2980846 augustus caesar
augustus caesar's picture

I have nothing personally against you Miramanee and you probably have a point regarding chemical flows related to group think.  However, just because one takes the opposite side of a discussion for the sake argument does mean that it has any validity. You could say that acceleration due to gravity is not 9.8 m/s2 however such a statement does not put you on equal footing arguing against the vast amount of literature coming from direct observation determing the acceleration due to gravity on Earth to be 9.8 m/s2  just because you are playing Devil's Advocate. The reason why most people here are not willing to consider that Central Banks could help problems such as austerity, depression, war, etc., is because we have determined that Central Banking is one of the primary causes of these problems. We have heard the theory that Central Banking could help these things for a number of years and it is only through personal experience and careful observation that we have determined these theories to be false.

How long do you expect us to give Central Banking the benefit of the doubt?

Just because people agree with you doesn't mean you, or they, are wrong.






Wed, 11/14/2012 - 15:31 | 2981014 Miramanee
Miramanee's picture

@ Caesar


AGREED!!! Central banking, in its current form, is a total disaster. You said, "...because we have determined that Central Banking is one of the primary causes of these problems. We have heard the theory that Central Banking could help these things for a number of years and it is only through personal experience and careful observation that we have determined these theories to be false..." And for the most part I AGREE. Central banking - the way it works in a money-as-debt fractional reserve system - is going to creare a neo-Feudal world, over the long haul, that is going to be utterly disastrous for billions of people. MY argument is that we need to reclaim central banking (per se) and employ fiat money as a public good.I also happen to believe that if we resort to austerity in the near term, we will not be prepared for the effects. We are a different world than the one that survived the Depression of the 1930s (and more importantly, the World War that followed).

And now....you and I are having a conversation about the issue. I think we need to be very careful when we refute outright the kick-the-can strategy. I understand that many believe it will be worse the longer we wait, but NOT if we are more prepared for that eventuality, and not if it happens during a period of "relative" peace and global detente.

Now we are engaged in front brain thinking. Thanks Caesar.

Wed, 11/14/2012 - 13:15 | 2980292 Overfed
Overfed's picture

In other words; is it really so bad to give that can one more good kick?

Wed, 11/14/2012 - 11:29 | 2979770 AnAnonymous
AnAnonymous's picture

More accurately addicted to reality.

'Americans' are addicted to propaganda and fantasy, probably to shield from reality as 'americans' have the biggest trouble dealing with the most obvious sides of reality.

Wed, 11/14/2012 - 15:35 | 2981036 akak
akak's picture

Chinese Citizenism citizens are addicted to Chinese state propaganda and Independent-Tibetans-as-slaveowners fantasy, probably to shield from reality, the stench as Chinese Citizenism citizens have the biggest trouble dealing with the most obvious crapped-up sides of the roads.

Wed, 11/14/2012 - 12:14 | 2979937 Ghordius
Ghordius's picture

Addicted to reality? Hope so. And yet, what to make out of a comment like "europe the socialist continent"? That has probably the same roots (aka think tank) as the "Bismarck was a socialist"?

Come on, the key aspect of socialism can be quantified: social spending per person and taxpayer and GDP and whatever.

I do not see the point for such shallow propagandistic remarks.

Wed, 11/14/2012 - 08:35 | 2979249 plaspotje
plaspotje's picture

not doom and gloom yet  , wait until the lies from the government stop because they can't hide  anymore ,   spain  greece 25% unemployment  are government numbers  what are the real numbers?

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